UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

 (Mark

(Mark one)

☒ ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended: February 28, 20212022

☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______________ to ___________________

Commission File Number 001-38402

MONAKER GROUP, INC.

(Exact name of registrant as specified in its charter)

(954) 888-9779

(Registrant’s telephone number, including area code code)

(954) 888-9779

Securities registered under Section 12(b) of the Exchange Act:

Securities registered under Section 12(g) of the Exchange Act: None.

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ☐ Yes ☒ No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. ☐ Yes ☒ No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large“large accelerated filer,” “accelerated“accelerated filer,” “smaller“smaller reporting company,” and “emerging“emerging growth company”company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant on August 31, 2020,2021, based on a closing sales price of $2.67$2.00 on such date, was approximately $25,275,435.$55 million. For purposes of calculating the aggregate market value of shares held by non-affiliates, we have assumed that all outstanding shares are held by non-affiliates, except for shares held by each of our executive officers, directors and 5% or greater stockholders. In the case of 5% or greater stockholders, we have not deemed such stockholders to be affiliates unless there are facts and circumstances which would indicate that such stockholders exercise any control over our company, or unless they hold 10% or more of our outstanding common stock. These assumptions should not be deemed to constitute an admission that all executive officers, directors and 5% or greater stockholders are, in fact, affiliates of our company, or that there are no other persons who may be deemed to be affiliates of our company. Further information concerning shareholdings of our officers, directors and principal stockholders is included or incorporated by reference in Part III, Item 12 of this Annual Report on Form 10-K.

As of June 7, 2021,17, 2022, the registrant had 23,454,203117,436,081 shares of its common stock, par value $0.00001 per share, outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

None.

NEXTPLAY TECHNOLOGIES, INC.,

formerly MONAKER GROUP, INC.

FORM 10-K

FOR THE YEAR ENDED FEBRUARY 28, 2022

TABLE OF CONTENTS

Definitions

 Definitions

Unless the context requires otherwise, references to the “Company,” “we,” “us,” “our,” “Monaker”, “Monaker Group” and “Monaker Group, Inc.NextPlay” in this Report refer specifically to Monaker Group,NextPlay Technologies, Inc. and its consolidated subsidiaries.

In addition, unless the context otherwise requires and for the purposes of this Annual Report on Form 10-K only:

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Discussions in this Annual Report on Form 10-K (this “Annual Report”), including, without limitation, those under the captions “Business,“Business,” “Risk Factors”“Risk Factors” and “Management’s“Management’s Discussion and Analysis of Financial Condition and Results of Operations”Operations” contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These include statements that involve expectations, plans or intentions (such as those relating to future business, future results of operations or financial condition, new or planned features or services, or management strategies) based on our management’s current beliefs and assumptions. You can identify these forward-looking statements by words such as “may,” “will,” “would,” “should,” “could,” “expect,” “anticipate,” “believe,” “estimate,” “intend,” “plan” and other similar expressions. These forward-looking statements involve risks and uncertainties that could cause our actual results to differ materially from those expressed or implied in our forward-looking statements. These factors include those set forth below under “Summary“Summary Risk Factors”Factors” and those disclosed under “Risk“Risk Factors,”, below.

Given these risks and uncertainties, you should not place undue reliance on these forward-looking statements. You should read the matters described in “Risk Factors”“Risk Factors” and the other cautionary statements made in this Report, as being applicable to all related forward-looking statements wherever they appear in this Report. We cannot assure you that the forward-looking statements in this Report will prove to be accurate and therefore prospective investors are encouraged not to place undue reliance on forward-looking statements. Other than as required by law, we undertake no obligation to update or revise these forward-looking statements, even though our situation may change in the future.

Summary Risk Factors Summary

We face risks and uncertainties related to our business, many of which are beyond our control. In particular, risks associated with our business include:

●           The number of sharesBelow is a summary of the Company’s common stock issuable at the closing of the Share Exchange Agreement, as amended, with HotPlay Enterprise Limited (“HotPlay”) and its stockholders, as amended andprincipal factors that make an investment in connection with the conversion of the Company’s Series B Convertible Preferred Stock and Series C Convertible Preferred Stock (the “Axion Preferred Conversion”) will result in significant dilution to existing stockholders;

●           The majority owners of HotPlay will obtain majority voting control over the Company following the closing of the HotPlay share exchange;

●           The Company’s officers and directors have interests in the HotPlay Share Exchange different from the other stockholders of the Company;

●           Combining HotPlay and the Company may be more difficult, costly or time-consuming than expected and the Company may fail to realize the anticipated benefits of the HotPlay share exchange, including expected financial and operating performance of the combined company (i.e., Monaker after completion of the HotPlay Share Exchange);

●           The Company may be unable to close the HotPlay Share Exchange on the schedule proposed, or if at all, and under certain circumstances the HotPlay Share Exchange may be terminated, which termination may have a material adverse effect on Monaker;

●           The Company and its operations and prospects are subject to restrictions while the HotPlay Share Exchange is pending;

●           Uncertainty and illiquidity in credit and capital markets can impair our ability to obtain credit and financing on acceptable terms and can adversely affect the financial strength of our business partners;

●           The closing of the HotPlay Share Exchange is contingent on the Company obtaining certain approvals, which may not be obtained on a timely basis or on favorable terms, if at all, including the requirement that the Company meeting NASDAQ’s initial listing requirements, which the combined company may be unable to meet;

●           Various third parties owe the Company a significant amount of money which may not be timely paid, if at all;

●           The Company owes significant amounts to Streeterville Capital, LLC, which is secured by a security interest over substantially all of its assets;

●           The Company will need to raise additional funding to support its operations, both before and after the closing, which funding may not be available on favorable terms, if at all;

●           The Company’s operations have been negatively affected by, and have experienced material declines as a result of, COVID-19 and the governmental responses thereto;

●           Currently pending and future litigation affecting the Company and HotPlay may have a material adverse effect on the Company and/or the combined company, and/or prevent the closing of the HotPlay Share Exchange;

●           The Company’s operations are subject to uncertainties and risks outside of its control, including third party delays in submissions of alternative lodging rental listings and failures to maintain such rental listings, integrations of such listings and the renewal of such listings;

●           The Company is subject to extensive government regulations and rules, the failure to comply which may have a material adverse effect on the Company;

●           The success of the Company is subject to the development of new products and services over time;

●           Longroot Holding (Thailand) Company Limited’s operations are subject to risks associated with cryptocurrency exchanges being a new industry, regulatory changes and/or restrictions, potential illegal uses of cryptocurrencies, the acceptance and widespread use of cryptocurrencies, cyber security risks, and competing blockchain technologies;

●           The Company is subject to competition with competitors who have significantly more resources, more brand recognition and a longer operating history than the Company;

●           The Company is subject to risks associated with failures to maintain intellectual property and claims by third parties relating to an allegation that the Company violated such third parties’ intellectual property rights;

●           The Company relies on third party service providers and the failure of such third parties to provide the services contracted for, on the terms contracted, or otherwise, could have a material adverse effect on the Company;

●           The Company relies on the internet and internet infrastructure for its operations and in order to generate revenues;

●           The Company’s ability to raise funding, and dilution caused by such fundings, anti-dilution rights included in outstanding warrants;

●           The trading price of the Company’s common stock is subject to numerous risks, including volatility and illiquidity;

●           The price of our common stock may fluctuate significantly, and you could losespeculative or risky. This summary does not address all or part of your investment;

●           The officers and directors of the Company haverisks that we face. Additional discussion of the ability to exercise significant influence over the Company;

●           Our business depends substantially on property owners and managers renewing their listings;

●           The marketrisks summarized in which we participate is highly competitive, and we may be unable to compete successfully with our current or future competitors;

●           If we are unable to adapt to changes in technology, our business could be harmed;

●           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;

●           We have incurred significant losses to date and require additional capital which may not be available on commercially acceptable terms, if at all;

●           Our ability to close the pending acquisition of control of International Financial Enterprise Bank, Inc., our ability to integrate the operations of such bank, if acquired, regulatorythis risk factor summary, and other risks associated therewith; and

●           Those discussed under the caption “Riskthat we face, can be found in Item 1A., “Risk Factors,” of this Annual Report and should be carefully considered, together with other information included in this Report.

WHERE YOU CAN FIND OTHER INFORMATION

We file annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and proxy and information statements and amendments to reports filed or furnished pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended. The SEC maintains a website (https://www.sec.gov) that contains reports, proxy and information statements and other information regarding us and other companies that file materials with the SEC electronically. Additional information about us is available on our website at www.Monakergroup.com.www.NextPlaytechnologies.com. We do not incorporate the information on or accessible through our websites into this filing, and you should not consider any information on, or that can be accessed through, our websites as part of this filing.

 3

PART I

Item 1. Business.

Introduction

ThisThe information included in this Annual Report on Form 10-K should be read in conjunction with the consolidated financial statements and related notes in “Item“Item 8. Financial Statements and Supplemental Data”Data” of this Report.

Our logo and some of our trademarks and tradenames are used in this Report. This Report also includes certain trademarks, tradenames and service marks that are the property of others. Solely for convenience, trademarks, tradenames and service marks referred to in this Report may appear without the ®, ™ and SM symbols. References to our trademarks, tradenames and service marks are not intended to indicate in any way that we will not assert to the fullest extent under applicable law our rights or the rights of the applicable licensors if any, nor that respective owners to other intellectual property rights will not assert, to the fullest extent under applicable law, their rights thereto. We do not intend the use or display of other companies’ trademarks and trade names to imply a relationship with, or endorsement or sponsorship of us by, any other companies.

The market data and certain other statistical information used throughout this Report are based on independent industry publications, reports by market research firms or other independent sources that we believe to be reliable sources. Industry publications and third-party research, surveys and studies generally indicate that their information has been obtained from sources believed to be reliable, although they do not guarantee the accuracy or completeness of such information. We are responsible for all of the disclosures contained in this Report, and we believe these industry publications and third-party research, surveys and studies are reliable. While we are not aware of any misstatements regarding any third-party information presented in this Report, their estimates, in particular, as they relate to projections, involve numerous assumptions, are subject to risks and uncertainties, and are subject to change based on various factors, including those discussed under the section entitled “Item“Item 1A. Risk Factors”Factors” in this Report. These and other factors could cause our future performance to differ materially from our assumptions and estimates. Some market and other data included herein, as well as the data of competitors as they relate to Monaker Group,NextPlay Technologies, Inc., is also based on our good faith estimates.

Our fiscal year ends on February 28th (or 29th during leap years). Interim results are presented on a quarterly basis for the quarters ended May 31, August 31, and November 30th, the first quarter, second quarter and third quarter, respectively, with the quarter ending February 28th/29th being referenced herein as our fourth quarter. Fiscal 2022 means the year ended February 28, 2022, whereas fiscal 2021 means the year ended February 28, 2021, whereas fiscal 2020 means the year ended February 29, 2020. Similarly, the year ended February 28, 2022 is our 2022 fiscal year.2021.

Corporate, Organizational and Business Information

Organizational History

Our predecessor, Maximus Exploration Corporation, was incorporated in the State of Nevada on December 29, 2005, and was a reporting ‘shell company’ as defined in Rule 405 of the Securities Act (“Maximus”). Extraordinary Vacations Group, Inc. (“EXVG”) was incorporated in the State of Nevada in June 2004. Extraordinary Vacations USA Inc. (“EVUSA”), EXVG’s wholly-owned subsidiary, is a Delaware corporation, incorporated on June 24, 2002. On October 9, 2008, EXVG agreed to sell 100% of EVUSA to Maximus and consummated a reverse merger with Maximus. Maximus then changed its name to Next 1 Interactive, Inc. On June 24, 2015, we changed our name to Monaker Group, Inc.

Executive Offices and Telephone Number

Our principal executive offices are located at 1560 Sawgrass Corporate Parkway, Suite 130, Sunrise, Florida 33323 and our telephone number is (954) 888-9779. Additional information about us is available on our website at www.monakergroup.com.https://www.nextplaytechnologies.com The information on our website is not incorporated herein by reference.

Organizational History

The Company was originally incorporated in the State of Nevada in on December 29, 2005 under the name Maximus Exploration Corporation (“Maximus”), and was a reporting “shell company” as defined in Rule 405 of the Securities Act.

On October 9, 2008, Maximus, a reporting shell company, entered into a Share Exchange Agreement (the “2008 Exchange Agreement”) with Extraordinary Vacation Group, Inc., a wholly-owned subsidiary of Maximus (“EXVG”), and EXVUSA, a wholly-owned subsidiary of EXVG. Pursuant to the 2008 Exchange Agreement, EXVG exchanged 100% of its shares in EVUSA for 13 million shares of common stock of Maximus, resulting in EXVG becoming the majority shareholder of Maximus through a reverse merger. EXVG then proceeded to dividend 13 million shares of Maximus common stock to the stockholders of EXVG, on a pro rata basis. As a result of these transactions, EVUSA became a wholly-owned subsidiary of Maximus. Maximus then amended its Certificate of Incorporation to change its name to Next 1 Interactive, Inc. (“Next 1”). After consummation of the transaction, Next 1 conducted all of its business through EVUSA, its wholly-owned subsidiary.

Overview

Summary

On June 22, 2015, the Company changed its name to Monaker Group, Inc. (“Monaker”).

On July 23, 2020, Monaker entered into a Share Exchange Agreement (as amended, the “2020 Exchange Agreement”) with HotPlay Enterprise Limited (“HotPlay”) and the shareholders of HotPlay, pursuant to which the HotPlay shareholders agreed to exchange 100% of the outstanding capital shares of HotPlay (making HotPlay a wholly-owned subsidiary of Monaker through a reverse merger following the closing of the transactions contemplated therein) for 52 million shares of Monaker’s common stock (the “HotPlay Shares”), subject to various closing conditions. The acquisition of HotPlay contemplated by the 2020 Share Exchange closed on June 30, 2021, at which time Monaker acquired 100% of the outstanding capital shares of HotPlay. The HotPlay acquisition was accounted for as a reverse acquisition, with HotPlay being deemed the acquiring company for accounting purposes. After consummation of the transaction, Monaker changed its name to NextPlay Technologies, Inc., and the Company altered its business plan to focus on the travel, cryptocurrency, and an in-game advertising industries.

On November 16, 2020, the Company acquired 100% of Longroot pursuant to a Stock Purchase Agreement (the “SPA”) entered into between the Company and Dr. Jason Morton (“Morton”) on November 2, 2020, and for certain limited purposes set forth therein, Longroot. Pursuant to the SPA, the Company purchased, 100% of Longroot, in consideration for (a) $1,650,000 in cash; (b) 200,000 shares of restricted common stock valued at $2.14 per share for a total value of $428,000, as well as 150,000 shares of restricted common stock valued at $3.00 per share, for a total value of $450,000.

On January 15, 2021, the Company entered into a Founding Investment and Subscription Agreement (the “Investment Agreement”) with Reinhart Interactive TV AG, a company organized in Switzerland (“Reinhart”), and Jan C. Reinhart, the founder of Reinhart (“Founder”), pursuant to which the Company agreed to pay the Founder 10,000,000 Swiss Francs (approximately $10.8 million U.S. Dollars) as compensation for the purchase of 51% of the ownership of Reinhart. The transaction closed on March 31, 2021, at which time Reinhart became a majority owned subsidiary of the Company.

On April 1, 2021, the Company 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.

On May 6, 2021, in anticipation of the acquisition of the 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 “Original Preferred Exchange Agreement”), pursuant to which the Company agreed to exchange 1,950,000 shares of the Company’s common stock for 5,850 shares of cumulative, non-compounding, non-voting, non-convertible, perpetual Series A Preferred shares of IFEB. 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.

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 1,648,614 of the outstanding Class A Common Stock of IFEB, representing 42.94% of such outstanding Class A Common Stock of IFEB, in consideration for an aggregate of 1,926,750 restricted shares of the Company’s common stock (the “IFEB Common Shares”), with each one share of Class A Common Stock of IFEB being exchanged for 1.168 restricted shares of 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 Common Stock of IFEB. As a result of the closing of both transactions, we acquired control of 100% of IFEB as of July 21, 2021. The name of IFEB was subsequently changed to NextBank International, Inc. (“NextBank”).

On March 30, 2022, the Company acquired certain assets from Go Game Pte Ltd. pursuant to an Asset Purchase Agreement, including a casual games tournament and gamification platform, a perpetual license to the goPay payment platform, and a range of casual game assets that can be leveraged to distribute the HotPlay In-Game Advertising platform and reward solutions throughout. As consideration for the purchase, the Company agreed to pay the seller $5,000,000, $2,750,000 of which has already been paid and the remainder of which is an innovative technology companypayable in monthly installments through March 31, 2023.

On May 5, 2022, the Company completed the acquisition of certain assets of Fighter Base Publishing, Inc. (“Fighter Base”) and Token IQ, Inc. (“Token IQ”), both of which entities are owned and controlled by Mark Vange, the Company’s Chief Technology Officer, pursuant to Intellectual Property Purchase Agreements executed in August 2021. Both of the acquisitions were contingent upon approval of the Company’s stockholders, which was obtained at the Special Meeting of Stockholders of the Company held on January 28, 2022, and certain other closing conditions. As consideration for the acquisitions, the Company issued 1,666,666 shares of Company common stock to Fighter Base and 1,250,000 shares of Company common stock to Token IQ.

Segment Reporting

Accounting Standards Codification 280-10 “Segment Reporting” established standards for reporting information about operating segments in annual consolidated financial statements and required selected information about operating segments in interim financial reports issued to stockholders. It also established standards for related disclosures about products, services, and geographic areas. Operating segments are defined as components of the enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance.

An operating segment component has the following characteristics:

The Company has three operating segments consisting of

See below, as well as Note 12 Business Segment Reporting, for additional details regarding each segment unit.

Overview

NextPlay Technologies, Inc. and its consolidated subsidiaries (collectively, “NextPlay,” “we,” “our,” “us,” or the “Company”) is building next generationa technology solutions company, offering games, in-game advertising, digital asset products and services, connected TV and travel booking services to consumers and corporations within a growing worldwide digital ecosystem. NextPlay’s engaging products and services utilize innovative advertising technology (“AdTech”), Artificial Intelligence (“AI”), and financial technology (“FinTech”) solutions to powerleverage the travel,strengths and channels of its existing and acquired technologies.

NextPlay is organized into 3 divisions: (i) NextMedia, the Company’s Interactive Digital Media Division (the “Media Division”); (ii) NextFinTech, the Company’s Finance and Technology (“FinTech”) Division; and (iii) NextTrip, the Company’s Travel Division.

Media Division

In the Media Division, NextPlay closed its acquisition of HotPlay and its In-Game Advertising (“IGA”) platform on June 30, 2021 and acquired a 51% interest in Reinhart on June 23, 2021. Reinhart owns 100 percent of Zappware, a 20-year-old interactive Digital TV solutions company based in Belgium. The acquisition of Reinhart gives NextPlay potential reach into tens of millions of households with its IGA, Video Game, FinTech, and Travel products.

Additionally, on March 30, 2022, NextPlay entered into an asset purchase agreement, pursuant to which it acquired certain assets of goPlay, a casual games tournament and gamification platform that also includes a perpetual license to the goPay payment platform, and a range of casual game assets that can be leveraged to distribute the HotPlay IGA and reward solutions throughout.

The Media Division provides multiple products and services focused on the In Game Advertising, In Game Rewards, Gamification, Competitive Gaming Tournaments and Connected TV Middleware solutions that collectively provide a feature rich gaming monetization platform that can be deployed at the Business-to-Business (“B2B”) or Business-to-Consumer (“B2C”) level by targeting game developers, game publishers and cryptocurrency industries. We believeTelco operators.

In addition to the most promising partvarious monetization platform components briefly described above, the Media Division’s Game Studio develops a range of casual games that are integrated with the In Game Advertising (“IGA”), In Game Rewards and goPlay gamification platform to enable developers, publishers, operators and brands alike to engage with and monetize their audience via the various go to market channels available to them through our business planoffering or their own channels.

These products and services are explained in more detail below.

The HotPlay In-Game Advertising and Rewards platform comprises multiple separate but related products that enable advertisements and rewards to be inserted in game, between game and post-game that allow brands to engage their audience in a relevant and inobtrusive fashion.

The HotPlay Games Studio is a game development studio that develops a range of casual games that include the HotPlay IGA platform features by default. The studio provides us with an in-house capability to deploy our abilityown range of casual games, plus the range of games available through the goPlay asset purchase agreement, providing a comprehensive portfolio of games that can be monetized by game publishers, operators and brands alike.

The “TV as a Service” (“TVaaS”) platform available to achieve shareholder valueNextPlay through Zappware is a complete end-to-end solution that includes media source ingest (satellite, terrestrial and digital), encoding and transcoding, packaging, protection, delivery, playback and analytics that provide Telco Operators with a one-stop shop for their digital media processing and delivery capabilities.

In addition to the core digital media delivery platform, the TVaaS solution also provides a client side Set Top Box (“STB”) and SMART TV middleware platform, associated application framework and corresponding, supporting Content Management System, that allows Operators to white label their own solutions on top of the Zappware platform to promote their own content through their existing partners and channels.

FinTech Division

The FinTech Division is developing an integrated digital financial platform (the “NextFinTech Platform”) offering mobile banking, investments into alternative assets, and insurance, to businesses and individuals, subject to regulatory approval.

The Company completed the acquisition of International Financial Enterprise Bank in July 2021, and organic growth that presents new opportunitiessubsequently renamed it NextBank International, Inc. (“NextBank”). Prior to the acquisition, NextBank generated revenue through the origination and selling of real estate loans in the leisure spaceUnited States and strengthens our existing technology platforms.continues to do so. NextBank typically receives an origination fee when issuing a loan and maintains a spread on the interest after the loans are sold. Currently, the Company is digitizing the bank and is configuring NextBank to grow with the rapid expansion of the digital asset industry, developing products and services that appeal to companies that are venturing into that industry. NextBank recently launched the first release of its mobile application in April 2022 and is migrating to DataPro’s core banking system to widen its capabilities and reach its scalability goals.

The Company, in accordance with Thailand’s foreign ownership laws, holds an indirect control of Longroot (Thailand) Company Limited (“Longroot”). Longroot is approved and regulated by the Thai Securities and Exchange Commission (“Thai SEC”) to operate as an Initial Coin Offering Portal (“ICO Portal”). The ICO Portal enables Longroot to crypto-securitize assets and conduct issuances of such assets. Through our subsidiaries NextTripthe ICO Portal, Longroot provides financial advisory and Maupintour (soontoken structuring services, and assists projects with regulatory approval and fundraising through sale of tokens. Longroot plans to crypto-securitize an array of high-quality alternative assets, such as video games and insurance. Management believes that these assets will create significant opportunities to accelerate the products and services within the FinTech division’s asset management business and plans to offer users the opportunity to invest in such assets via the NextFinTech Platform.

Effective November 16, 2021, the Labuan Financial Services Authority (the “Labuan FSA”)approved the Company’s application to carry on general insurance and reinsurance business, subject to certain conditions including (i) payment of a $15,000 annual license fee, (ii) submission of evidence reflecting paid up capital amounting to MYR $10.0 mil (approximately to $2,390,000 US), (iii) submission of proof of registration as a member of Labuan International Insurance Association, and (iv) submission of a Management Services Agreement with the appointed insurance manager, (v) submission of a Letter of Undertaking, and (vi) submission of constituent documents to the Registration of Company Unit. The conditions are to be rebrandedmet within 3 months of November 29, 2021, the date Labuan FSA issued a letter confirming the conditional approval. In May 2022, the Company received a permission letter from Labuan FSA to extend the establishment until August 31, 2022. The Company plans to use the general insurance license to issue primary insurance products and the reinsurance license to issue crypto-securitized insurance in collaboration with Longroot.

On October 14, 2021, “Longroot Inc.” (a subsidiary of the Company) changed its name to “Next Fintech Holdings, Inc.” The Company plans to use Next Fintech Holdings, Inc. as NextTrip Journeys), wethe holding company for the FinTech division.

Travel Division

Our Travel Division currently offers booking solutions for both business and leisure. We provide travel technology solutions with a primary emphasis on alternative lodging rental (ALR)(“ALR”) properties. Our proprietary Booking Engine, branded as NextTrip ConNextions, provides travel distributors access to a sizeable inventory of ALR properties allowing them to combine ALR with traditional components of travel (Air, Car, Cruise,(air, car, cruise, etc.).

Our industry-leading platform assists property managers in booking, and broadening the market for, their homes. The CompanyOur Travel Division serves three major constituents: (1) property managers, (2) travelers, and (3) other travel/lodging distributors. Property managers integrate their detailed property listings into the MonakerCompany’s Booking Engine with the goal of reaching a broad audience of travelers seeking ALRs, through distribution channels they could not access otherwise.

All of Monaker’sthe Company’s ALRs, also commonly referred to as Vacation Rentals are:

We believe that Monaker business-to-business (B2B)the Company’s B2B ALR offerings are timely in addressing traditional travel distributors’ needs to protect their client base by allowing them seamless access to ALR products. With the rapid growth of companies like Airbnb, we believe that traditional travel companies are realizing that not having access to this high demand vacation rental inventory means risking the loss of their consumers to other ALR sites. By connecting to Monaker’sthe Company’s Booking Engine, travel distributors can sell ALR inventory alongside their existing travel products (i.e., Air/Car/Hotel/Cruise/Tourair/car/hotel/cruise/tour bookings). This solves a key issue by allowing the customers of traditional travel distributors to complete their entire vacation package booking on their website versus forcing them to go to an ALR website and potentially lose the entire booking.

Monaker’s Direct to Consumer Websites

MonakerThe Company has established a direct-to-consumer presence though a number of websites.

These sites include NextTrip.com,NextTripBusiness.com, our corporate travel management platform focused on small to medium-sized business, that provides companies the ability to book travel, manage travel expenses, and process employee expense reports. A differentiating feature of our NextTrip.comNextTripBusiness.com solution is the ability for corporate travelers to book ALR properties as part of their travel itinerary. Beyond access to our ALR inventory, Maupintour.com (soon to be rebranded as NextTrip Journeys),Journeys, provides personalized concierge tours and activities at destinations around the world. Our online marketplaces are discussed in greater detail below.

Monaker

The Company identifies and sources ALR properties which it consolidates through its Monaker Booking Engine, allowing for instantly bookable properties being packaged alongside other travel products; this is its distinguishing niche. The ALRs are owned and leased by third parties and are available to rent through Monaker’sthe Company’s websites as well as through other distributors. Monaker’sThe Company’s services include critical elements such as technology, an extensive film library, trusted brands and established partnerships that enhance product offerings and reach. We believe that consumers are quickly adopting video for researching and educating themselves prior to purchases, and Monakerthe Company has carefully amassed video content, key industry relationships and a prestigious travel brand as cornerstones for the development and deployment of core-technology on both proprietary and partnership platforms.

MonakerThe Company sells travel services to leisure and corporate customers around the world. Our primary focus is to incorporate ALR options into our current offerings of scheduling, pricing and availability information for booking reservations for airlines, hotels, rental cars, as well as other travel products such as sightseeing tours, shows and event tickets, and theme park passes. The Company sells these travel services both individually and as components of dynamically-assembled packaged travel vacations and trips. In addition, the Company provides content that presents travelers with information about travel destinations, maps and other travel details. In December 2020, the Company introduced its new corporate travel platform under the NextTrip brand. This platform allows our users to search large travel suppliers of alternative lodging inventories and combine ALR with their air and car booking.

In March 2018, the Company introduced Travelmagazine.com, an online travel publication with the aim of giving travelers around the world inspiration for future travel destinations and trips. The publication offers written articles, videos, and podcasts.podcasts created by staff writers and worldwide content providers. Moving forward, we hope thatintend to incorporate the Metaverse into Travelmagazine.com, will becomeallowing tourist boards, destination management companies, and other travel suppliers to showcase their products by allowing travelers to virtually explore destinations around the world. This strategy aligns with our goal to make Travelmagazine.com a central hub of informationcontent for travelers who are looking to get detailed information on destinations all around the world. We also plan to move Travelmagazine.com from having content created by a team of staff writers, to a team of worldwide writers who will contribute content for publication in the future, funding permitting. The website is expected to be supportedgenerate revenue through advertising by advertisingfrom tourist boards, travel suppliers, and allow for promotion of both ALR and Maupintour vacation products.NextTrip.

The Company sells its ALR travel inventory through various distribution channels. The primary distribution channel is through its business-to-business (B2B)B2B channel partners, which include sales via (i) other travel companies’ websites and (ii) networks of third-party travel agents. Secondary distribution is planned to occur through the Company’s own websites at Maupintour.com (soon to be rebranded as NextTrip Journeys)Nexttripjourneys.com and NextTripbusiness.com. Additionally, we anticipate offeringoffer high end ALR products along with specialty travel products and services via NextTripjourneys.com, targeting high value inventory to customers with complex or high-end travel needs, upon its launch which is scheduled for August 2021.needs.

Monaker’sThe Company’s core travel related holdings are planned to behave been streamlined by this summer into four key platforms being;platforms: the MonakerCompany’s Booking Engine (MBE) branded as NextTrip ConNextions, Nexttripbusiness.com, NextTrip.com, Maupintour.com, which will be rebranded as NextTripjourneys.com,NextTripJourneys.com and TravelMagazine.com.

Cryptocurrency Portal

As discussed in greater detail below under “Recent Material Events—Longroot Stock Purchase Agreement”, on November 16, 2020, the Company acquired 100% of Longroot, Inc., a Delaware corporation (“Longroot”), which in turn owned 57% of Longroot Limited, a Cayman Islands company (“Longroot Cayman”). Longroot Cayman owned 49% of the outstanding ordinary shares (with 51% of the Preferred shares owned by two Thai citizen nominee shareholders) of Longroot Holding (Thailand) Company Limited (“Longroot Thailand”), provided that Longroot Cayman controls 90% of Longroot Thailand’s voting shares and therefore effectively controls Longroot Thailand. Longroot has since increased its ownership in Longroot Cayman and currently Longroot owns an approximate 36.75% indirect interest in Longroot Thailand, due to its ownership of 75% of Longroot Cayman, which in turn owns 49% of Longroot Thailand (75% x 49% = 36.75%)), provided that Longroot Cayman controls 90% of Longroot Thailand’s voting shares and therefore effectively controls Longroot Thailand.

Longroot Thailand provides blockchain technology solutions for the fast-growing cryptocurrency marketplace. Longroot Thailand is an Initial Coin Offering (ICO) portal operator authorized and regulated under the Thai Digital Asset Business Law and licensed by the Thai Securities and Exchange Commission. Longroot Thailand provides fully regulated and licensed digital assets financing, and investment services for digital assets. This innovative business model opens the door for new digital currency financing mechanisms, and new digital investment products. Monaker, with its indirect control over Longroot Thailand, is planning to use Longroot Thailand’s technology and digital asset capabilities to create regulated cryptocurrencies designed to allow consumers to invest in unique revenue streams in wholesale travel, real estate homes and hotels, gaming assets and digital advertising – as well as potential token and loyalty program opportunities complementary to Monaker’s planned gaming (with the acquisition of HotPlay) and current travel businesses.

Travel Products and Services

Monaker plans to focus on marketing ALR options directly to consumers and to other travel distributors. The Company’s concentration on ALRs is driven by contracts with vacation home (including timeshare) unit owners and managers that make their properties available to consumers and to other travel portals (Distributors) for nightly or extended stays. In addition, we offer travelers activities and tours through our subsidiary, Maupintour (soon to be rebranded as NextTrip Journeys).NextTripJourneys.com. Therefore, not only can we assist a traveler with identifying a destination and the lodging at the destination, but we can provide options of activities while at the destination. We also provide the means for making arrangements for airline tickets, car rentals and lodging (i.e., hotels and ALRs in the near future).lodging. In summary, Monaker offerswe offer travelers the complete travel package made easy or... Travel Made Easy^TM.

The average ALR search and booking takes a few hours while the average vacation planning process typically involves the consumer visiting up to seven travel websites and spending over 10 hours to book their vacation (according to Susan Ho, Founder of Journy). We believe the NextTrip.com websiteNextTripBusiness.com and NextTripJourneys.com websites using the above features should reduce ALR/Vacation planning time from hours to minutes and with the convenience of one site (truly “Travel“Travel Made Easy”Easy”).

Products and Services for Property Owners and Managers

Listings.Listings. Property owners and managers are able to list a property, with no initial upfront fees, and provide those listings to us at a negotiated preferential rate for traveler bookings generated on our websites. Listings that are ‘real-time online bookable’ properties will be managed by the property owner or manager through an application program interface (API)(“API”), which will provide real-time updates to each property and immediately notify the property owner or manager of all information regarding bookings, including modifications and cancellations. Information such as content, descriptions and images are provided to us through that API.

Listings that are “request-accept”“request-accept” properties will require communication and approval from the property owner or manager and will not be managed through an API (as discussed above). We will provide a set of tools for the property owner or manager that will enable them to manage an availability calendar, reservations, inquiries and the content of the listing. These tools will allow the property owner or manager to create the listing by uploading photographs, text descriptions or lists of amenities, a map showing the location of the property, and property availability, all of which can be updated throughout the term of the listing. Each listing will provide travelers the ability to use email or other methods to contact property owners and managers.

The listings include tools and services to help property owners and managers run their vacation rental businesses more efficiently: responding to and managing inquiries, preparing and sending rental quotes and payment invoices, allowing travelers to book online and, enter into rental agreements, and processing online payments. Property owners and managers who elect to process online payments will be subject to a transaction fee.

Redistribution of Listings.Listings. We make selected, online bookable properties available to online travel agencies as well as channel partners (jointly referred to as “Distributors”“Distributors”). We are compensated for these services by receiving a commission that is added to the negotiated net rate for each booking.

Products and Services for Travelers

Search Tools and Ability to Compare. Our online marketplace NextTripJourneys.com provide travelers with tools to search for and filter several travel products including air, car, accommodations (including ALRs) and activities based on various criteria, such as destination, travel dates, type of property, number of bedrooms, amenities, price, or keywords.

Traveler Login.Login. Travelers are able to create accounts on our website(s) that give them access to their booking activity through the website.

Travel Blog.Blog. Travel guides, videos and pictures as well as travel articles can be accessed through Travelmagazine.com.

Security.Security. We use a combination of technology and human review to evaluate the content of listings and to screen for inaccuracies or fraud with the goal of providing only accurate and trustworthy information to travelers. Our company is Payment Card Industry (PCI)(“PCI”) compliant to ensure the safety and security of our customer credit card data.

Communication.Communication. Travelers who create an account on our website will receive regular communications, including notices about places of interest, special offers, new listings, and an email newsletter. The newsletter will be available to any traveler who agrees to receive it and offers introductions to new destinations and vacation rentals, as well as tips and useful information when staying in vacation rentals.

Mobile Websites and Applications.Applications. We provide versions of our websites formatted for web browsers, smart-phones and tablets so that property owners, managers and travelers can access our websites and tools from mobile devices.

To date, we have focused on developing our booking engine and establishing relationships with suppliers to increase the size of our instantly bookable inventory. The booking engine has produced little revenue to date because, among other reasons, of the limited number of widely-used distribution partners with which we have been able to establish relationships. We have recently begun contractingare finalizing certification with established, widely-used distribution partners to make our inventory available through their distribution channels. The success of the booking engine will depend on users of those distribution partners booking properties supplied by our booking engine, and on our ability to expand the number of such distribution partners that utilize our booking engine.

The Company has completed integrating several distributors for the booking of our ALR products and the Company continues to integrate suppliers of ALR products. We now have more than 3.2 million properties listed on our booking engine.

Competition

Media Division

With the large global gamer population, the rising trend of digital advertising, and growing interest in the Metaverse, HotPlay expects increasing competition as companies seek to deliver in-game advertising that do not disrupt game play. Currently, HotPlay competes directly with: 

Products

Given HotPlay’s ability to deliver fungible ads that do not disrupt gameplay and Servicesthat requires a lower integration effort, management believes that the HotPlay Platform compares favorably with those direct competitors.

HotPlay also competes indirectly with other advertising platforms that deliver in-game advertisements in forms that disrupt gameplay, such as platforms delivering impression ads, click through ads, and rewarded video ads.

The market for Cryptocurrency Investorsplatforms offering a game portfolio and tournament features is also highly competitive with the continuing rise of e-sports and need for platforms and service providers to increase engagement with their users. Several businesses including e-commerce and streaming businesses have recently included casual games to their portfolio. HotPlay competes directly with these businesses and service providers offering white-labeled solutions to such businesses. However, management believes that the integration of non-disruptive advertising and real-world rewards allows HotPlay to compete favorably with these direct competitors.

ICO Portal. Through our indirect controlOn this front, HotPlay also competes indirectly with e-sports platforms and game streaming platforms that offer different categories of Longrootgames such as mid-core and hard-core games.

Reinhart Interactive TV competes directly with other end-to-end TV as a service (“TVaaS”) providers offering media content delivery solutions to telco companies as well as telecommunication companies that implement their own solutions. We also compete indirectly with other media content providers such as Over the Top (“OOT”) platforms and video streaming platforms.

FinTech Division

The market for fundraising via regulated ICOs in Thailand we,is still in an early stage. Under the Thai SEC’s Thai Royal Decree, any offering of digital assets must be made through Longroot Thailand, offer an ICO Portal locatedapproved by the Thai SEC. The ICO Portal is responsible for carrying out due diligence on an issuer and conducting the actual offering. There are currently seven Thai SEC approved ICO Portals, and Longroot competes directly with them in Thailand. With the increased acceptance of cryptocurrencies and adoption of blockchain technology, our management believes that there will be more ICO Portals approved, increasing the number of direct competitors.

As Longroot does not limit its offerings to the Thai market, it also competes directly with financial institutions that facilitate financing through the sale of regulatory compliant digital assets globally.

The market for fundraising via the sale of digital assets backed by tangible assets is still at Longroot.com,a nascent stage. However, as many regulators worldwide become increasingly accepting of token offerings, management believes that provides investorsregulatory compliant token offerings will become more commonplace. While this could result in more business opportunities for Longroot, it is also likely to translate to an increase in competition. 

Longroot also competes indirectly with companies facilitating more traditional avenues of raising funds, such as investment banks that underwrite initial public offerings or bond issuances, and commercial banks offering direct loans to businesses. However, management believes that the advantages of digital assets offerings, such as the ability to securitize alternative assets, provide a high degree of flexibility on deal structure, and the reliability offered by blockchain technology could give Longroot a competitive advantage.

The banking industry is highly competitive and NextBank competes directly with other traditional banks and digital banks for deposits and origination of loans. Management believes that NextBank is able to compete effectively through the provision of concierge services for depositors, and the ability to originate loans and disburse funds, without compromising on the required due diligence, more quickly than its competitors.

The FinTech market is growing rapidly, with new entrants constantly entering the market. As NextFintech adopts a FinTech model, offers card services, and builds products to support the growing digital investment productasset industry, NextBank expects to compete directly with crypto-focused, blockchained based financial services companies and gives suppliers a new digital currency financing mechanism. Monaker,payment companies. However, through its indirect controlthe combination of Longroot Thailand, is planning to use thetraditional banking and financial technology, and digital asset capabilitiesthe undertaking of new initiatives in a regulatory compliant manner, Management believes that NextBank is well-positioned to create regulated cryptocurrencies designedexecute a growth strategy to allow consumers to invest in unique revenue streams in wholesale travel, real estate homes and hotels, gaming assets and digital advertising – as well as potential token and loyalty program opportunities complementary to Monaker’s gaming (planned throughachieve our mission of creating a diversified financial solution for the acquisition of HotPlay) and travel businesses.global economy.

The Company is a Nevada corporation headquartered in Weston, Florida.

Travel Division

Planned Future Operations

As described in greater detail below under “Recent Material Events—HotPlay and Axion Share Exchanges”, “Recent Material Events—Reinhart Interactive TV AG and Zappware N.V. Acquisition”, and “Recent Material Events—IFEB Bank Transaction”, the Company is in the process of completing the acquisition of HotPlay, which has developed a next generation in-game advertising (IGA) solution that harmonizes engagement between businesses and video gamers, has acquired 51% of Reinhart TV AG, which is in the business of providing a software-based TV and video distribution platform to telecom operators and digital content owners and providing services to telecom operators and digital content owners for user interaction design, as well as software development, deployment and support, and is in the process of completing the acquisition of control 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).

Moving forward, assuming the completion of the acquisition of HotPlay and IFEB bank, the Company anticipates the majority of its operations will transition to those of HotPlay, provided that the Company plans to continue to pursue cryptocurrency and banking operations through Longroot and IFEB. The Company is also excited about the prospects of the Reinhart TV AG acquisition.

Competition

The market to provide listing, searching, and marketing services whether they are for ALR, activities and tours, airline bookings, car rentals or hotel stays is highly competitive and fragmented with limited barriers to entry. Each of the ALR services that we will provide to property owners, managers and travelers is currently offered by competitors. Furthermore, ALRs are not typically marketed exclusively through any single channel, and many of our listing agreements are not exclusive, potentially allowing our competitors to aggregate a set of listings like ours. We believe we will compete primarily based on the quantity, quality, and nature of the properties offered on our websites. The majority of ALRs that will be offered in our marketplace reflect a whole house or property rather than a room. In addition, we anticipate that we will benefit from the quality of the direct relationships we have with property owners and managers, the global diversity of the ALRs available on our websites, the quality of our websites, the tools provided to our property owners and managers, the strength of our brands, and the success of our marketing programs and price.

Our principal competitors in the travel space include:

The market for fundraisingResearch and Development

Media Division

We have developed proprietary systems based on patent pending technologies to create, maintain and operate our media based websites, services and platforms. These technologies comprise systems developed by internal and third-party designers, developers and engineers and software acquired, licensed or open-sourced from outside developers and companies. Our systems are designed to serve our internal game studio, other third-party game developers and advertisers at both the Business-to-Business (“B2B”) and Business-to-Consumer (“B2C”) level via regulated Initial Coin Offeringsa range of business models, including recurring license fees, Cost-per-mille (“ICO”CPM”), Cost-per-action (“CPA”) and revenue share advertising models.

FinTech Division

NextBank has focused on identifying and implementing technology solutions, such as updated core banking systems and transaction security, compliance and monitoring systems, and is moving rapidly to integrate with payment providers and exchanges. After launching the first release of its mobile banking app in ThailandApril 2022, NextBank is still atworking on fortifying security and scalability, adding features and capabilities, and expanding supported platforms to include all popular mobile and desktop devices.

Longroot has put considerable resources into researching technology solutions, such as suitable blockchain protocols and third-party security services, and has developed a proprietary system that serves its clients and internal operations, while complying with the nascent stage. Under Thailand’s Securities and Exchange Commission’s (“Thai SEC”) Thai Royal Decree, any offeringrules of digital assets must be made through an ICO Portal approved by the Thai SEC. TheIts systems are designed to onboard investors on to the ICO Portal is responsible for carrying out due diligence on an issuer and conducting the actual offering.

At present, only four ICO Portals, including Longroot Thailand, have been approved by the Thai SEC and Longroot Thailand competes directly with them. With the increased acceptance of cryptocurrencies and adoption of blockchain technology, HotPlay management believes that there will be more ICO Portals approved, increasing the number of direct competitors.

Longroot Thailand also competes indirectly with companies facilitating more traditional avenues of raising funds, including investment banks that underwrite initial public offerings or bond issues, commercial banks offering direct loansPlatform in a compliant manner, offer access to businesses, and others. However, HotPlay management believes that advantages of digital assets offerings,information related to individual ICOs, such as the ability to securitize alternative assets, provide a high degree of flexibility on deal structure,their prospectus, and that the reliability offered by blockchainparticipate in ICOs.

Costs associated with our research and development were included as capitalized development costs or, included in several expenses including technology could give Longroot Thailand a competitive advantage. Furthermore, the Thai SEC ICO Portal is allowed to offer digital assets to both retail and institutional investors, giving issuers access to a wider investor market.development, salaries, and benefits and in general and administrative expenses.

Seasonality

Property owners and managers tend to list their properties when travelers are most likely to make vacation plans. The timing primarily depends on whether travelers are taking a winter or summer vacation and tends to vary by country. The highest level of listings is expected in the first quarter of a year, which is typically when travelers are making plans for summer vacations in the United States and Europe. The lowest level of listings is expected in the third quarter. By the fourth quarter, property owners and managers of winter vacation destinations will be listing their properties in time to meet the needs of travelers planning those trips. Other vacation areas outside of the United States and Europe also have seasonality, which may not be reflected in the same quarters (for example, winter and summer months are reversed in the southern hemisphere).

As the listings grow, the seasonality of those transactions may result in higher revenues in the summer and winter vacation months. We also expect seasonality in the number of visitors to our websites, with the first quarter having the highest number of visitors.

Notwithstanding the above, adverse economic conditions, or pandemics, including COVID-19, could result in future seasonal patterns that are different from historical trends.

Research and DevelopmentTravel Division

We have developed proprietary systems to create, maintain and operate our websites. This technology consists of systems developed by internal and third-party designers, developers and engineers and software acquired or licensed from outside developers and companies. Our systems are designed to serve other property distributors, property owners, managers, and travelers in an automated and scalable fashion.

Technology and Infrastructure

Media Division

Our websites and platforms are hosted using cloud services distributed globally across multiple regions. Our systems have been designed to automatically scale on demand at both the B2B and B2C levels to maintain an extremely high level of availability, regardless of end user demand. Industry leading cloud based security system are in place to protect our platforms from unauthorized access and data breaches. Where possible, the services have been designed in a cloud agnostic manner to minimize the dependency on any single cloud provider and facilitate deployment across multiple cloud providers, as necessary.

FinTech Division

NextBank is transitioning to Datapro’s core banking system in order to enhance its capabilities and support its growth and scalability goals. Datapro develops and deploys advanced software solutions specifically designed to meet the changing needs of financial institutions worldwide. With a singular focus on the banking/financial services sector, Datapro uses cutting edge technologies and hands-on expertise to simplify all banking processes from data management and customer relationship functions to national/international regulatory compliance.

To further enhance compliance and transaction monitoring, NextBank is using Ocean Systems’ software. Ocean Systems, Inc. (“OSI”) is a software development company specializing in Compliance and Electronic Funds Transfer (“EFT”) applications for the financial and banking industry. They provide compliance solutions related to bank payment systems concerning Automated Clearing House (“ACH”), Wire Transfers, Automated Teller Machine (“ATM”), and Point of Sale (“POS”).

NextBank is committed to adhering to the highest level of security. Leveraging Amazon Web Services’ (“AWS”) infrastructure allows security configurations to be tightened. Strengthening NextBank’s network security enables stable scalability. Additionally, NextBank uses EnCirca, a registrar that provides supports domain name registrations and provides trademark protections services, as its registrar. They are one of only a small handful of registrars authorized to host .Bank domains. As the leading Internet Corporation for Assigned Names and Numbers (“ICANN”) registrar for the .Bank extension, EnCirca is well-equipped to offer state-of-the-art technology services for hosting secure websites and email.

Longroot Thailand’s proprietary ICO Portal Platform is built upon a number of innovations that allow it to serve investors, issuers, and the Longroot Thailand internal team in a secure and compliant manner. The platform leverages the Ethereum network, giving investors and issuers access to an ecosystem of services, such as secondary markets, exchanges, custodians, insurers, and decentralized finance services.

The platform also includes an integrated Securities Tokenization Offering technology. Not only does the technology allow Longroot Thailand to tokenize assets that are fully compliant with Thailand’s Royal Decree on Digital Assets Businesses, we believe that it will also allow Longroot Thailand to conduct similar offerings in other jurisdictions in the future, thereby enabling Longroot Thailand to expand its operations.

The infrastructure has a high level of reliability and is designed to allow Longroot Thailand to scale efficiently while maintaining the security levels required of a financial services operator. The platform is hosted using a combination of third-party data centers powered by Google Cloud Platform (“GCP”) and associated security services provided by other third parties. The high level of redundancy provided by GCP and designed into its infrastructure helps ensure that Longroot Thailand can reliably serve clients globally, 24x7. Longroot Thailand also uses security methods to ensure the integrity of its networks and protection of confidential data collected and stored on its servers. Longroot Thailand has put considerable resources into researching technology solutions, suchdeveloped internal policies and procedures to protect the information of investors and issuers that it collects and uses as suitable blockchain protocolspart of its normal operations. Access to its networks, and third-party security services,the servers and has developed a proprietary system that serves its clients and internal operations while complying with the Thai SEC. Its systems are designed to onboard investorsdatabases, on to the ICO Portal Platform in a compliant manner, offer access to information related to individual ICOs, such as their prospectus, and participate in ICOs.which confidential data is stored, is protected by industry standard firewall technology.

Costs associated with our research and development were included as capitalized development costs or, included in several expenses including technology and development, salaries, and benefits and in general and administrative expenses.

Travel Division

Technology and Infrastructure

Our websites are hosted using cloud services distributed globally across multiple regions. Our systems architecture has been designed to manage increases in traffic on our websites through additional computing power without making software changes. Our cloud services provide our online marketplace with scalable and redundant Internet connectivity and redundant power and cooling to our hosting environments. We use security methods to ensure the integrity of our networks and protection of confidential data collected and stored on our servers, and we have developed and use internal policies and procedures to protect the personal information of our property owners, managers and travelers using our websites that we collect and use as part of our normal operations. Access to our networks, and the servers and databases, on which confidential data is stored, is protected by industry standard firewall and encryption technology(s).technology. Physical access to our servers and related equipment is secured by limiting access to the data center to operations personnel only. Costs associated with our web hosting operation are included in general and administrative costs.

Intellectual Property

The Company currently holds a wide range of intellectual property relating to software and products across its different divisions. This includes patent pending products, copyrights, registered and unregistered trademarks, trade secrets, industrial designs, registered domain names, and other forms of intellectual property rights.

Media Division

The Media Division intellectual property includes the HotPlay in-game advertising platform, which consists of the game developer portal, advertiser portal, redemption application, and Software Development Kit (“SDK”), artificial intelligence powered video game development technology, and proprietary casual games, as well as Zappware’s digital TV platform.

Longroot Thailand’s proprietaryAt the Media Division, the Company has filed patent protection for HotPlay’s in-game advertising technology and Make It Games’ Artificial Intelligence animation technology.

FinTech Division

The FinTech division intellectual property includes the NextBank mobile banking platform, Longroot’s ICO Portal, Platform is built upon a number of innovations that allow it to serve investors, issuers,Token IQ’s securities token offering technology, and the Longroot Thailand internal team in a secureproducts and compliant manner. The platform leverages the Ethereum network, giving investors and issuers access to an ecosystem of services such as secondary markets, exchanges, custodians, insurers, and decentralized finance services.

The platform also includes an integrated Securities Tokenization Offering technology. Not only does the technology allow Longroot Thailand to tokenize assets that are fully compliant with Thailand's Royal Decree on Digital Assets Businesses, it will also allow Longroot Thailand to conduct similar offerings in other jurisdictions in the future, thereby enabling Longroot Thailand to expand its operations.

The infrastructure has a high level of reliability and is designed to allow Longroot Thailand to scale efficiently while maintainingsupport the security levels required of a financial services operator. The platform is hosted using a combination of third-party data centers powered by Google Cloud Platform (GCP) and associated security services provided by other third parties. The high level of redundancy provided by GCP and designed into its infrastructure helps ensure that Longroot Thailand can reliably serve clients globally, 24x7. Longroot Thailand also uses security methods to ensure the integrity of its networks and protection of confidential data collected and stored on its servers. Longroot Thailand has developed internal policies and procedures to protect the information of investors and issuers which it collects and uses as part of its normal operations. Access to its networks, and the servers and databases, on which confidential data is stored, is protected by industry standard firewall technology.digital asset industry.

Intellectual PropertyAt the FinTech division, the Company has filed patent protection for Token IQ’s security token offering technology.

OurTravel Division

The Travel division intellectual property includes the travel management platform and property management solution for alternative lodging properties, the content of our websites, our registered domain names, our registered and unregistered trademarks, contracts with third party property managers and distributors. We believe

The Company believes that ourits intellectual property is an essential asset of ourits business and that our registered domain names and our technology infrastructure will givegives us a competitive advantage in the online market for ALR listings and arrangements with attractions and tour operators.advantage. We rely on a combination of trademark, copyright and trade secret laws in the United States and internationally, as well as contractual provisions, to protect our proprietary technology and our brands. We also rely on copyright laws to protect the appearance and design of our sites and applications, although to date we have not registered for copyright protection on any particular content. We have registered numerous Internet domain names related to our business in order to protect our proprietary interests. We alsogenerally enter into confidentiality and invention assignment agreements with our employees and consultantscontractors, and seekconfidentiality with third parties. The Company also files patent applications to control access toprotect innovations arising from our research and distribution of our proprietary information in a commercially prudent manner. Thedevelopment.

These efforts we have taken to protect our intellectual property may not be sufficient or effective and despite these precautions, itwe may not receive approval on our pending patents. It may be possible for other parties to copy or otherwise obtain and use the content of our websites or ourits platform and brand names without authorization.

The primary web properties are:

Employees

Longroot Thailand’s intellectual property includes the ICO Portal Platform, its registered domain, its registered and unregistered trademarks, and its status as a Thai SEC’s approved ICO Portal that was obtained after going through a rigorous process that included approval of its business plan and audits of its internal processes and technology, which took close to two years to complete.

We believe that Longroot Thailand’s intellectual property is an essential asset of its business and that its ICO Portal status, registered domain names and technology infrastructure will give it a competitive advantage. Longroot Thailand relies on a combination of trademark, copyright and trade secret laws as well as contractual provisions, to protect its proprietary technology and brands. It also relies on copyright laws to protect the appearance and design of its sites and applications, although to date it has not registered for copyright protection on any particular content. Longroot Thailand has registered numerous Internet domain names related to its business in order to protect its proprietary interests. Longroot Thailand also enters into confidentiality and invention assignment agreements with its employees and consultants and seeks to control access to and distribution of its proprietary information in a commercially prudent manner. The efforts Longroot Thailand has taken to protect its intellectual property may not be sufficient or effective, and, despite these precautions, it may be possible for other parties to copy or otherwise obtain and use the content of its Platform or our brand names without authorization.

Longroot Thailand’s primary web properties are:

● www.Longroot.com

● portal.Longroot.co.th

● sign-up.Longroot.co.th

Employees

WeOn average, we employed 18approximately 250 full-time employees as ofthroughout the date of this Report.reporting period. Additionally, we use independent contractors and temporary personnel to supplement our workforce, particularly in the software development and technology tasks. Our employees are not represented by a labor union, and we consider our employee relations to be very good. Competition for qualified personnel in our industry has historically been intense, particularly for software engineers, developers, and other technical staffs.

Longroot Thailand employs three full-time employees as of the date of Report. Additionally, Longroot Thailand uses independent contractors and temporary personnel to supplement its workforce, particularly in the software development and technology tasks. Its employees are not represented by a labor union and it considers its employee relations to be very good. Competition for qualified personnel has historically been intense, particularly for software engineers, developers, and other technical staff.

Employee Development, Attraction and Retention: The development, attraction and retention of employees is a critical success factor for the Company and its operating units for succession planning and sustaining our core value drivers. To support the advancement of our employees, we offer training and development programs encouraging advancement from within and strive to fill our team with strong and experienced management talent. We leverage both formal and informal programs to identify, foster, and retain top talent at both the corporate and operating unit level.

Diversity and Inclusion: The Company believes that its rich culture of inclusion and diversity enables it to create, develop and fully leverage the strengths of its workforce to exceed customer expectations and meet its growth objectives. The Company places a high value on inclusion, engaging employees in our programs staffed by employees with diverse backgrounds, experiences or characteristics who share a common interest in professional development, improving corporate culture and delivering sustained business results.

Segments

We operate as one operating segment consisting of products and services related to our online travel services and cryptocurrency marketplaces. Our travel services are composed of the following services:

Longroot Thailand operates as one operating segment consisting of the ICO Portal Platform where applicable investors are able to sign up and invest in available ICOs, and issuers can issue tokens and list information related to their offerings. The Platform has been approved by the Thai SEC and is built in a manner that enables the Longroot Thailand internal team to conduct the necessary checks to ensure compliance with applicable regulations.

Other Investments

As part of prior business transactions, and in many cases, in lieu of requiring counterparties to pay us cash consideration for certain dispositions, we have accepted and/or retained securities in various entities (including former subsidiary companies). As described below, we are currently in the process of liquidating those securities in an effort to increase liquidity and we do not intend to hold such securities.

We assess the potential impairment of our equity method investments when indicators such as a history of operating losses, negative earnings and cash flow outlook, and the financial condition and prospects for the investee’s business segment might indicate a loss in value.

Verus International, Inc and NestBuilder.com Corp (OTCMKTS:VRUS)

We have recognized an impairment loss on investment in unconsolidated affiliate. As of February 28, 2021, and February 29, 2020, Monaker owned 3,845,101 and 61,247,139 shares of Verus International, Inc. (formerly known as RealBiz Media Group, Inc. (“Verus”)) Series A Convertible Preferred Stock, respectively. This interest was written down to zero ($0) as of February 28, 2015. On January 13, 2021, Verus completed a 1-for-500 reverse stock split which has been retroactively reflected in the discussion below.

On April 10, 2019 and effective on February 8, 2019, we entered into an Inducement Agreement with Verus. Pursuant to the Inducement Agreement, we agreed to amend the designation of the Series A Convertible Preferred Stock of Verus (the “Series A Preferred Stock”)(of which we held 44,470,101 shares of Series A Preferred Stock at the time of the entry into the Inducement Agreement, which converts into common stock of Verus, and votes on all stockholder matters, on a one-for-500 basis, subject to the Ownership Blocker (discussed below)), to remove certain anti-dilution rights described therein; and Verus agreed to issue us 304,060 shares of its common stock, following Verus’ then planned increase in authorized shares of common stock, pursuant to the anti-dilution rights of that certain Settlement Agreement by and among the Company, Verus, AST and NestBuilder discussed above. The designation of the Series A Preferred Stock, as amended, includes a 9.99% beneficial ownership limitation, preventing the Company from converting such Series A Preferred Stock into common stock of Verus (and reducing the voting rights of such preferred stock proportionally), if upon such conversion, the Company, its affiliates and/or any group which it is a part of, would own greater than 9.99% of Verus’ common stock (the “Ownership Blocker”).

On April 16, 2019, Verus filed a Certificate of Amendment (the “Amendment”) to its Amended and Restated Certificate of Incorporation, as amended, to increase its authorized common stock from 1,500,000,000 shares to 7,500,000,000 shares and to decrease the par value of its common stock and preferred stock from $0.001 per share to $0.000001 per share. On April 23, 2019, Verus issued us the 304,060 shares of common stock.

On October 29, 2019, the Company entered into Stock Purchase Agreements with (a) Monaco Investment Partners, LP, of which Donald Monaco is the managing partner and a member of the board of directors of the Company; (b) Simon Orange, a member of the board of directors of the Company; and (c) William Kerby, the Chief Executive Officer and director of the Company. Pursuant to the Stock Purchase Agreements, the Company sold the purchasers 51,125 shares (3,125 shares to Mr. Kerby and 25,000 shares to each of Monaco Investment Partners, LP and Mr. Orange) of Series A Preferred Stock of Verus. The purchase price for the Verus shares was determined by the board of directors of the Company, based on among other things, the recent trading prices of Verus’ common stock on the OTCQB Market, as publicly reported. The Company received net proceeds of $425,000 from the Stock Purchase Agreements.

On January 22, 2020, the Company entered into a Stock Purchase Agreement with William Kerby, the Chief Executive Officer and Director of the Company. Pursuant to the agreement, the Company sold Mr. Kerby 3,125 shares of restricted Series A Preferred Stock of Verus for a total of $25,000 or $8.00 per shares.

As of February 29, 2020, the Company owned 122,495 shares of Verus’s common stock which had a fair value of $8.00 per share or $979,954 in aggregate.

Since the issuance date of such common stock, the Company has sold 61,247,139 shares of common stock of Verus and therefore, as of February 28, 2021, the Company owned 0 shares of common stock of Verus. The change in fair value of $649,020 is recognized in net loss as other expense, realized loss, net. 

Bettwork Industries Inc. (OTC Pink: BETW)

On July 2, 2018, three Secured Convertible Promissory Notes aggregating $5,250,000 (as described in greater detail in the notes to the audited financial statements below under “Item 8. Financial Statements and Supplementary Data—Note 3 – Notes Receivable”), which were entered into with Bettwork Industries Inc. (“Bettwork”), were exchanged for 7,000,000 shares of Bettwork’s common stock at $0.75 per share for a fair value of $5,250,000 as of July 2, 2018. Bettwork’s common stock has a readily determinable fair value as it is quoted on the OTC Pink market under the symbol “BETW”.

On November 29, 2018 and December 6, 2018, the Company sold 428,572 shares of Bettwork common stock to each of (a) the Donald P. Monaco Insurance Trust, of which Donald Monaco is the trustee and the Chairman of the board of directors of the Company; and (b) Charcoal Investment Ltd, which entity is owned by Simon Orange, a member of the board of directors of the Company for an aggregate of $300,000 ($600,000 in total), or $0.70 per share.

On February 29, 2020, the shares of Bettwork’s common stock were trading at $0.25 per share which decreased the fair value of the 6,142,856 remaining shares of Bettwork common stock held by the Company to $1,535,714 and caused an accumulated fair value loss of $6,081,427 to be realized. The change in fair value of $6,081,427 is recognized in net income (loss) on the statement of operations, as other income, valuation loss, net, as a valuation loss as of February 29, 2020.

On February 28, 2021, the shares of Bettwork’s common stock were trading at $0.09 per share which decreased the fair value of the 6,142,856 remaining shares of Bettwork common stock held by the Company to $55,286 and caused an accumulated fair value loss of $1,480,428 to be realized. The change in fair value of $1,480,428 is recognized in net income (loss) on the statement of operations, as other income, valuation loss, net, as a valuation loss as of February 28, 2021.

Recruiter.com Group, Inc., formerly Truli Technologies Inc (OTCQB:RCRT)

On August 31, 2016, we entered into a Marketing and Stock Exchange Agreement with Recruiter.com (“Recruiter”). The Agreement required Monaker to issue to Recruiter 75,000 shares of Monaker common stock in exchange for 2,200 shares of Recruiter common stock. Also, Monaker issued to Recruiter an additional 75,000 shares of Monaker common stock for marketing initiatives within the Recruiter platform. In essence, Monaker issued 75,000 shares of its common stock to purchase 2,200 shares of Recruiter, and Monaker issued an additional 75,000 shares of its common stock as a prepayment for marketing and advertising within the Recruiter platform. Recruiter was at that time a private company with a platform that companies and individuals use for employment placements.

On January 15, 2019, pursuant to an Agreement and Plan of Merger / Merger Consideration, Truli Technologies Inc which subsequently changed its name to Recruiter.com Group, Inc. (OTCQB: RCRT) (“Recruiter.com”), acquired Recruiter and Monaker exchanged its 2,200 shares in Recruiter for 139,273 shares of Recruiter.com common stock.

As of February 29, 2020, each share of Recruiter.com’s common stock was valued at $2.25 per share which decreased the fair value of the 139,273 shares of Recruiter.com common stock to $313,363 and caused an accumulated fair value loss of $160,164 to be realized. The change in fair value of $160,164 is recognized in net income (loss) as other income, valuation loss, net, on the statement of operations, as a valuation loss as of February 29, 2020. 

As of February 28, 2021, each share of Recruiter.com’s common stock was valued at $3.39 per share which decreased the fair value of the 78,137 shares of Recruiter.com common stock to $264,884 and caused an accumulated fair value loss of $48,479 to be realized. The change in fair value of $48,479 is recognized in net income (loss) as other income, valuation loss, net, on the statement of operations, as a valuation loss as of February 28, 2021. 

Longroot Thailand

As discussed in greater detail above under “Recent Material Events—Longroot Stock Purchase Agreement”, on November 16, 2020, the Company acquired 100% of Longroot, which in turn owned 57% of Longroot Cayman. Longroot Cayman owns 49% of the outstanding ordinary shares (with 51% of the Preferred shares owned by two Thai citizen nominee shareholders)  of Longroot Holding (Thailand) Company Limited (“Longroot Thailand”), provided that Longroot Cayman controls 90% of Longroot Thailand’s voting shares and therefore effectively controls Longroot Thailand.

In accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 805, the Company has accounted for this business combination utilizing the following values in connection with the purchase of Longroot, Inc.: total consideration to selling shareholder of $2,528,000 (and $2,250,636, net of cash acquired) and the purchase price has been provisionally allocated as follows. The fair value of net assets acquired were $219,940 and an intangible asset (license) of $2,212,702 with the liabilities assumed of $142,983 and minority interest of $39,023. The business combination accounting is provisionally complete for all assets and liabilities acquired on the acquisition date.

Sources and Availability of Raw Materials and the Names of Principal Suppliers

Our products do not require the consumption of physical raw materials.

Longroot Thailand outsources the development Our products mainly involve cost of the ICO Portal Platform to Atato Company Limited (“Atato”), a company incorporated in Thailand,rendering of services, such as employees, contractors, amortization of intangible assets and has signed an agreement for their services from November 16, 2020 to November 15, 2021.etc.

Dependence on One or a Few Customers

We doIn Fiscal year 2022, we did not depend on one or a few customers. As we expand our business, we do not anticipate that we will depend on one or a few customers.

Government Regulation

Our operations are subject to, and affected by, various government regulations, as well as foreign and U.S. federal, state and local government authorities. TheseOur providers, distributors, etc. are also subject to periodic renewal and ongoing regulatory requirements. The rules, regulations, policies and procedures affecting our businesses are constantly subject to change. The following descriptions are summarysummaries in nature, and do not purport to describe all present and proposed laws and regulations affecting our businesses.

Regulation of the Internet

We operate several internet websites, which we use to distribute information about and supplement our programs. Internet services are now subject to regulation in the United States relating to the privacy and security of personally identifiable user information and acquisition of personal information from children under the age of 13, including the federal Child Online Protection Act (COPA)(“COPA”) and the federal Controlling the Assault of Non-Solicited Pornography and Marketing Act (CAN-SPAM).(“CAN-SPAM”), amongst other privacy related rules and regulations. In addition, a majority of states have enacted laws that impose data security and security breach obligations. Additional federal and state laws and regulations may be adopted with respect to the Internet or other online services, covering such issues as user privacy, child safety, data security, advertising, pricing, content, copyrights and trademarks, access by persons with disabilities, distribution, taxation and characteristics and quality of products and services. In addition, to the extent we offer products and services to online consumers outside the United States, the laws and regulations of foreign jurisdictions, including, without limitation, consumer protection, privacy, advertising, data retention, intellectual property, and content limitations, may impose additional compliance obligations on us.

Thailand is in the process of introducing a Personal Data Protection Act (“PDPA”), which all companies in Thailand that handle personal data will be required to adhere to, once implemented. This means that employers, businesses, and individuals that collect and process personal data would have to review and ensure that their data policies, particularly those pertaining to the rights of the data subjects and the obligations of data controllers, are in line with the PDPA’s provision once it comes to effect.

Longroot Thailand’s operations are subject to, and affected by, various government regulations. The rules, regulations, policies and procedures affecting its businesses are constantly subject to change. The following descriptions are summary in nature and do not purport to describe all present and proposed laws and regulations affecting its businesses.

Longroot Thailand is regulated under the Thai SEC Royal Decree on Digital Assets Businesses that requires all ICOs in Thailand to be conducted by a Thai SEC approved ICO Portal. As an ICO Portal, Longroot Thailand is also responsible for carrying out due diligence on issuers. The decree was only recently introduced in 2018, and is subject to amendment. Longroot Thailand will need to constantly monitor the regulations as they evolve and stay compliant.to remain in compliance.

Longroot Thailand is also regulated under the Thailand Anti-Money Laundering Office (AMLO)(“AMLO”), and is required to adhere to the Anti-Money Laundering Act and Counter-Terrorism and Proliferation of Weapon of Mass Destruction Financing Act of Thailand. As such, Longroot Thailand carries out Know Your Customer (KYC)(“KYC”) checks on all issuers, investors and its internal team before on boardingonboarding them to help ensure compliance.

Thailand is in the process of introducing a Personal Data Protection Act (PDPA), which all companies in Thailand that handle personal data would be required to adhere to. This means that employers, businesses, and individuals that collect and process personal data would have to review and ensure that their data policies, particularly those pertaining to the rights of the data subjects and the obligations of data controllers, are in line with the PDPA’s provision once it comes to effect.

There are several business taxes levied by the Thai central government under the principal tax law, Revenue Code, such as Corporate Income Tax, Value Added Tax, Specific Business Tax, Customs Duties, Excise Tax and Stamp Duties. Hotplay Thailand and Longroot Thailand hashave a duty to assess itstheir own income and ensure the right amount of taxes are paid to the government authorities and to correct to avoid additional tax penalty after the government inspection.

Blockchain technologies and digital currencies, are increasingly becoming subject to governmental regulation, both in the US and internationally. Blockchain technologies and cryptocurrency are under review with a number of US and foreign governmental agencies. Other governmental or quasi-governmental regulatory bodies have shown an interest in regulating or investigating companies engaged in digital currency related business. For instance, in early March 2021, the SEC chairperson nominee expressed an intent to focus on investor protection issues raised by cryptocurrencies. Presently, except as otherwise discussed in this Report, we do not believe any regulatory body in a foreign jurisdiction in which we operate, US or State regulatory body has taken any action or position adverse to our blockchain and digital currency related activities; however, future changes to existing regulations or entirely new regulations may affect our business in ways it is not presently possible for us to predict with any reasonable degree of reliability.

NextBank provides traditional banking services and the origination and sale of loans and receivables financing, among other types of lending services, as an International Financial Entity (“IFE”) under license by the Office of the Commissioner of Financial Institutions of Puerto Rico (“OCIF”). Pursuant to its authorization to operate as an IFE, the International Financial Center Regulatory Act of Puerto Rico, as amended (the “IFE Act”), it will be only allowed to perform banking transactions (accepting deposits, making loans, etc.) with any person or entity not considered domestic (in Puerto Rico) (with the exception of the investments in stocks, notes or bonds from the local government) including a range of transactions enumerated in its charter and other transactions for which prior approval is required from the OCIF. The minimum capitalization of the IFE will be $5 million. As provided in the IFE Act, at least $0.25 million must be fully paid-in at the time the license to operate as an international financial entity is issued by the Commissioner. The capital of the IFE must satisfy the adequacy criteria required in a safe and sound financial institution, in the manner provided by federal and state banking statutes and verification of which used by the Federal Deposit Insurance Corporation.

Other Regulations

We are also subject to various local, state, and federal regulations, including, without limitation, regulations promulgated by federal and state environmental, health and labor agencies.

Recent Material Events

Amended Revolving Monaco Trust Note

On December 9, 2019,Appointment and departure of Executive Officers and Directors of the Company entered into an Amended

Effective upon the Closing of the HotPlay Share Exchange, resignations of Mr. Pasquale “Pat” LaVecchia, Mr. Doug Checkeris, Mr. Rupert Duchesne, Mr. Robert “Jamie” Mendola, Jr. and Restated Promissory Note withMs. Alexandra C. Zubko became effective and such persons were deemed to have resigned from the board of directors of the Company. In addition, Mr. Simon Orange, a then member of the board of directors, resigned as a director of the Company effective on June 30, 2021. Mr. William Kerby and Mr. Donald P. Monaco, Insurance Trust,remained as members of which Donald P. Monaco is the trusteeboard of directors following the closing.

In connection with the closing of the HotPlay Share Exchange, and pursuant to the Chairmanterms thereof, the Company’s board of directors approved the increase in the number of directors from eight to nine and upon closing of the HotPlay Share Exchange, each of Mr. J. Todd Bonner, Ms. Nithinan Boonyawattanapisut (the spouse of Mr. Bonner), Mr. Komson Kaewkham, Mr. Athid Nanthawaroon, Mr. Yoshihiro Obata, Ms. Stacey Riddell, and Ms. Carmen L. Diges were appointed to serve as members of the board of directors of the Company, (the “joining William Kerby and Donald Monaco Trust”), inwho remained on the amountboard of up to $2,700,000 (the “Revolving Monaco Trust Note”).directors following the closing.

Mr. J. Todd Bonner and Mr. Donald Monaco were appointed as Co-Chairpersons of the board of directors following the closing. Certain of the new members of the board of directors were also appointed as members of the committee of the board of directors, as discussed in further detail elsewhere in this Report.

The amount owedboard of Directors determined that Mr. Komson Kaewkham, Mr. Yoshihiro Obata, Ms. Stacey Riddell, and Ms. Carmen L. Diges, were “independent” pursuant to the Revolving Monaco Trust Note accrues interest atrules of the rateNasdaq Capital Market.

On November 9, 2021, Stacey Riddell resigned as a member of 12% per annum (18% upon the occurrenceCompany’s board of an eventdirectors. Ms. Riddell’s resignation was not the result of default). The Revolving Monaco Trust Note contains standard and customary events of default.

On January 29, 2020,any disagreement with the Company entered into a first amendmenton any matter relating to the Revolving Trust Note with the Monaco Trust, to extend the maturity date of such note from February 1, 2020 to April 1, 2020. No other changes were made to such note as a result of such amendment.Company’s operations, policies or practices.

On March 27, 2020, Company entered into a second amendment to the Revolving Trust Note with the Monaco Trust, to extend the maturity date of such Revolving Monaco Trust Note to December 1, 2020. No other changes were made to such note as a result of such amendment.

On November 6, 2020,23, 2021, the Company’s board of directors appointed Farooq Moosa as an independent director of the Company entered into a third amendment to fill the Revolving Trust Note with the Monaco Trust, to extend the maturity date of such Revolving Monaco Trust Note to February 28, 2021. No other changes were made to such note as a result of such amendment.vacant board seat resulting from Ms. Riddell’s resignation.

On November 16, 2020, the Company entered into a fourth amendment to the Revolving Trust Note with the Monaco Trust, to increase the amount available under such Revolving Monaco Trust Note to $2,800,000. No other changes were made to such note as a result of such amendment.

The Revolving Monaco Trust Note was fully repaid on January 4, 2021, with funds raised through the December 2020 underwritten offering discussed below.

HotPlay and Axion Share Exchanges

As disclosed in greater detail in the Current Report on Form 8-K filed by the Company with the SEC on July 23, 2020, on July 23, 2020, the Company entered into a Share Exchange Agreement (as amended by the first amendment thereto dated October 28, 2020, as disclosed in the Current Report on Form 8-K filed with the SEC on October 29, 2020, the second amendment thereto dated November 12, 2020, as disclosed in the Current Report on Form 8-K filed with the SEC on November 18, 2020, the third amendment thereto dated January 6, 2021, as disclosed in the Current Report on Form 8-K filed with the SEC on January 11, 2021, and the fourth amendment thereto dated February 22, 2021, as disclosed in the Current Report on Form 8-K filed with the SEC on February 26,9, 2021, the “HotPlay Exchange Agreement” and the transactions contemplated therein, the “HotPlay Share Exchange”) with HotPlay Enterprise Limited (“HotPlay”) and the stockholdersCompany’s board of HotPlay (the “HotPlay Stockholders”). The transactions contemplated by the HotPlay Exchange Agreement are subject to certain closing conditions, including, the approval of the listing of the combined company’s common stock on the NASDAQ Capital Market following the closing.

Additionally,directors appointed Edward Terrence Gardner, Jr. as disclosed in the Current Report on Form 8-K filed with the SEC on November 18, 2020, on November 12, 2020, the Company entered into an Amended and Restated Share Exchange Agreement (as amended by the first amendment thereto dated January 6, 2021, as disclosed in the Current Report on Form 8-K filed with the SEC on January 11, 2021, the “Axion Exchange Agreement”) with certain stockholders holding shares of Axion Ventures, Inc. (“Axion” and the “Axion Stockholders”) and certain debt holders holding debt of Axion (the “Axion Creditors”)(the “Axion Share Exchange”, and collectively with the HotPlay Exchange Agreement, the “Exchange Agreements” and the transactions contemplated therein, the “Share Exchanges”). The transactions contemplated by the Axion Exchange Agreement closed on November 16, 2020.

Pursuant to the HotPlay Exchange Agreement, the HotPlay Stockholders agreed to exchange 100% of the outstanding capital shares of HotPlay (making HotPlay a wholly-owned subsidiaryindependent director of the Company, following the closingappointment, the board is now composed of 10 members.

Change in Principal Executive Officer (“PEO”)

On January 3, 2022, Nithinan “Jess” Boonyawattanapisut, Co-Chief Executive Officer of the Company, assumed the role of the Company’s PEO, thereby replacing William Kerby, the Company’s other Co-Chief Executive Officer, who stepped down from the PEO role.

Ms. Boonyawattanapisut’s assumption of the Company’s PEO role was based on various considerations, including her familiarity with the Company’s financial statements and operations post-acquisition of HotPlay.

Significant Business and Asset Acquisitions

Reinhart Interactive TV AG and Zappware N.V.

On January 15, 2021, we entered into a Founding Investment and Subscription Agreement with Reinhart Interactive TV AG, a company organized in Switzerland, and Jan C. Reinhart, the founder of Reinhart. The Investment Agreement contemplated the Company acquiring 51% of the ownership of Reinhart, in consideration for 10 million Swiss Francs (approximately $10.8 million US). Consideration was paid by cash and the transaction was closed on June 23, 2021.

More information regarding this transaction is disclosed in Note 4 - Acquisitions and Dispositions.

NextBank International (formerly IFEB)

On April 1, 2021, we entered into a Bill of Sale for Common Stock, effective March 22, 2021, with certain third parties, pursuant to which the Company agreed to purchase 2,191,489 shares, the IFEB Shares, of authorized and outstanding Class A Common Stock of IFEB, a Puerto Rico corporation licensed as an Act 273-2012 international financial entity headquartered in San Juan Puerto Rico, which IFEB Shares totaled approximately 57.16% of the outstanding Class A Common Stock of IFEB. The purchase price of the IFEB Shares was $6.4 million, which amount was paid to the sellers on April 1, 2021.

Separately, on July 21, 2021, the Company entered into, and closed the transactions contemplated therein)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 1,648,614 of the outstanding Class A Common Stock of IFEB, representing 42.94% of such outstanding Class A Common Stock of IFEB, in consideration for 52 millionan aggregate of 1,926,750 restricted shares of the Company’s common stock (the “HotPlay Shares”“IFEB Common Shares”)., with each one share of Class A Common Stock of IFEB being exchanged for 1.168 restricted shares of 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 Common Stock of IFEB.

As a result of the closing of both transactions, we acquired control of 100% of IFEB as of July 21, 2021.

More information regarding this transaction is disclosed in Note 4 - Acquisitions and Dispositions.

Go Game Asset Purchase

On June 30, 2021, the Company entered into a Securities Purchase Agreement (the “Go Game SPA”) with David Ng, an individual (the “Seller”). Pursuant to the Axion Exchange Agreement, (a)Go Game SPA, the Axion Stockholders (including Cern One LimitedCompany agreed to acquire a 37% interest in the capital stock of Go Game Pte Ltd, a Singapore private limited company (“Cern One”)Go Game”), exchanged ordinarya mobile game publisher and technology company, representing an aggregate of 686,868 shares of Axion equal to approximately 33.85% ofGo Game’s Class B Preferred shares (the “Initial Go Game Shares”). The Go Game SPA also included an option whereby the then outstanding commonCompany could acquire additional shares of Axion,Go Game, as described in greater detail below. Pursuant to the Go Game SPA, the aggregate consideration to be paid for 10,000,000 shares of newly designatedthe Initial Go Game Shares was: (i) 6,100,000 shares of Series B ConvertibleD Preferred Stock (representing $6.1 million of value, based on an aggregate liquidation preference of $6.1 million), and (ii) $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.

Pursuant to the Go Game SPA, the Company was also granted an option (the “Go Game Option”), to purchase up to an additional 259,895 shares of Go Game’s Class B Preferred shares from the Seller (the “Option Shares”) (representing 14% of Go Game’s outstanding Class B Preferred shares, or 51% with the Initial Go Game Shares). The Go Game Option was subject to the Seller’s acquisition of the Company (the “Series B Preferred Stock”), which are automatically convertible into common sharesOption Shares subsequent to the date of the Company upon the occurrence of certain events, including the closing of the HotPlay Share Exchange, into an aggregate of 7,417,700 shares of Monaker common stock; and (b) the Axion Creditors exchanged debt of Axion in the aggregate amount of $7,657,024 (the “Axion Debt”), for (i) 3,828,500 shares of newly designated shares of Series C Convertible Preferred Stock of the Company (the “Series C Preferred Stock”), which are automatically convertible into common shares of the Company upon the occurrence of certain events, including the closing of the HotPlay Share Exchange, on a one-for-one basis; and (ii) a warrant, grantedGo Game SPA. The Go Game Option was to Cern One,be exercisable from time to purchase 1,914,250 shares of the Company’s common stock (the “Creditor Warrants”), which is only exercisable upon the occurrence of certain events (described below). Although the Axion Share Exchange closed on November 16, 2020, the Company has yet to formally complete the transfer of the ownership of the Axion shares into its name, due to a Cease Trade Order issued by the British Columbia Securities Commission, which impacts Axion.

The Creditor Warrants, have cashless exercise rights, an exercise price of $2.00 per share and have a term of two years, beginning on the Vesting Date (defined below). The Creditor Warrants vest on the later of (a)time after the date that the Series B Preferred Stock and Series C Preferred Stock convert into common stock, and the earlier of (i) the date the Axion Debt is fully repaid by Axion or (ii) the date that Monaker obtains 51% or more of the voting control of, and economic rights to, Axion, provided that such vesting date must occur before November 16, 2021, or the Creditor Warrants will terminate (as applicable, the “Vesting Date”). All of the Creditor Warrants were granted to Cern One.

The HotPlay Exchange Agreement can be terminated by the parties thereto under various circumstances, including if the transactions contemplated thereby have not both been completed by April 30, 2021, provided that such termination date is extended automatically, until up to May 31, 2021, in the event that Monaker has, prior to such date, filed a definitive proxy statement with the SEC, has called a special meeting to approve the issuance of the shares to the HotPlay Stockholders, among other things, and is continuing to work in good faith to complete the closing of the HotPlay Share Exchange, which termination date has been extended automatically to May 31, 2021 (the “Outside Date”).

At a special meeting of stockholders held on April 7, 2021, the stockholdersshareholders of the Company approved the issuance of shares of common stock upon conversion of the Series D Preferred Stock and in connection with the HotPlay Share ExchangeGo Game Option (the “Approval Date”), and the terms thereof and the shares of common stockprior to January 1, 2022. The per share consideration due in connection with the conversionan exercise of the Series B Preferred StockGo Game Option was to be equal to $70 million, divided by the then number of outstanding shares of Go Game ($37.71 per share at the time the agreement was entered into) (the “Call Option Price”). The Call Option Price was to be satisfied by the issuance of shares of Company common stock valued based on the greater of (a) $2.35 per share and Series C Preferred Stock, among other matters. The Company is currently working with(b) 85% of the NASDAQ Capital Market to obtain approval foraverage of the continued listingclosing prices of the Company’s common stock followingfor the closingprior thirty days (the “30-Day Average”). The Seller agreed not to transfer the Option Shares from the date acquired through the exercise or expiration of the HotPlay Share Exchange, which approval the Company hopes to receive in or around June 2021 and which HotPlay Share Exchange the Company hopes to close in or around June 2021. The parties are fully committed to closing the HotPlay Share Exchange and the Company expects to extend the Outside Date, or otherwise continue to work together with HotPlay and the HotPlay Stockholders to close the HotPlay Share Exchange, following the dateGo Game Option. Upon issuance of this Report.

Following the closingany shares of common stock upon exercise of the HotPlay Share Exchange,Go Game Option, the current HotPlay Stockholders are expectedSeller agreed to own approximately 60.0%enter into a lock-up agreement restricting any sales or transfers of the outstanding common stockany shares of Monaker, and the Axion Stockholders and Axion Creditors are expected to own, upon the automatic conversion of the outstanding Series B Preferred Stock shares and Series C Preferred Stock shares into common stock of the Company for a period of 18 months following the issuance date.

We agreed, pursuant to the Go Game SPA, that, upon the closingour purchase of the HotPlay Share Exchange, approximately 13.0%Initial Go Game Shares, we would appoint the Seller to the board of directors of the aggregate outstandingCompany, and that we would continue to nominate the Seller as a board nominee for appointment on the board of directors at each subsequent shareholder meeting of the Company, subject to certain exceptions, until the earlier of (i) Seller’s death; (ii) Seller’s resignation from the board of directors; (iii) the date that Seller is no longer qualified to serve as a member of the board of directors; (iv) the date the board of directors, acting in good faith, determines that the continued appointment of Seller to the board of directors would violate the fiduciary duties of such members of the board of directors; (v) the third anniversary of the acquisition of the Initial Go Game Shares; and (vi) the date that the Seller holds less than 2 million shares of Company common stock of Monaker, without taking into account the(including shares of common stock issuable upon exercise of the Creditor Warrants, with the Monaker stockholders prior to the effective date of the closing holding approximately 27.1% of the aggregate outstanding common stock of the combined company, in each case based on the current outstandingconversion shares of common stockSeries D Preferred Stock held by Seller).

As of Monaker.

We previously operated solely inNovember 30, 2021, the travel industry. Withsecond payment of $1.25 million, originally payable on or before July 31, 2021 and the recent acquisitionthird payment of Longroot, as previously discussed, we are now venturing into$2.5 million originally payable on or before September 30, 2021 had not been paid and the cryptocurrency industry. Uponshares of Series D Preferred Stock had not been issued, and such payments remained on hold subject to the completion of due diligence and further negotiation by the HotPlay Exchange Agreement,parties. Total payments made to the Seller as of November 30, 2021 were $1,250,000.

On March 30, 2022, the Company, plansGo Game and the Seller entered into an asset purchase agreement (the “Asset Purchase Agreement”), which amended and restated in its entirety the Go Game SPA, whereby Go Game agreed to transition its operationssell and assign to those of a travel, cryptocurrency, and an in-game advertising company. During the period until the closing of the HotPlay Exchange Agreement, and in the event the HotPlay Exchange Agreement is not consummated, the Company, intends to continue to actively operate in the travel and cryptocurrency industries.

To date, HotPlay has loaned the Company $15 million pursuantagreed to purchase and assume from Go Game, substantially all the assets and certain liabilities related to the terms of the HotPlay Exchange Agreement (collectively, the “HotPlay Loans”goPlay platform (the “Go Game Assets”), pursuant to which HotPlay was required to have at least $15 million in cash on hand as of the closing of such HotPlay Exchange Agreement, less amounts loanedtogether with a perpetual license to the Company. goPay payment gateway (the “goPay License”).

The HotPlay Loans are evidenced by Convertible Promissory Notes (collectively, the “HotPlay Notes”), which have an interest rateconsummation of 1% per annum.

The HotPlay Notes are automatically forgiven by HotPlay in the event the HotPlay Exchange Agreement is terminated in certain situations and automatically convert into fully paid and nonassessable shares of the Company’s common stock at a conversion price of $2.00 per share, subject to the NASDAQ Limitation, described below, in the event the HotPlay Exchange Agreement is terminated in certain other situations.

In the event the transactions contemplated by the HotPlay Share Exchange close, itAsset Purchase Agreement (the “Closing”) occurred on or about April 4, 2022, following the execution of the Asset Purchase Agreement on March 30, 2022.

As consideration for the Go Game Assets and the receipt of the goPay License, the Company agreed to pay $5,000,000 (the “Purchase Price”) as follows:

No stock consideration of Go Game or the Company is anticipatedbeing exchanged, as was previously contemplated under the Go Game SPA.

In the event the Company defaults on its monthly cash payment obligations under (iii) above, the Company agrees that the HotPlay NotesSeller shall be given the absolute right to demand for the return by way of assigning, transferring, and delivering to Seller all of the Company’s right, title, ownership and interest in certain games and source code for goPay (without taking away the perpetual licensing right).

For a period of six months following the closing, Go Game will be forgivenprovide transitional assistance to the Company to integrate the goPlay platform and associated game titles, together with the goPay payment gateway, at no additional charge.

The goPay License allows the Company to exploit the goPay payment gateway to enhance the products and service offerings of the Company. The goPay License does not allow the Company to exploit and sublicense the goPay technology as intracompany loans.a stand-alone product.

The maximum numberPrior to the Closing, Go Game was engaged in discussions with potential customers of sharesthe goPlay platform. At the Closing, the Company and Go Game entered into a revenue share agreement (the “Revenue Share Agreement”), pursuant to which Go Game shall refer such potential customers and any other potential customers to the Company, in exchange for a right to receive 50% of common stocknet revenues attributable to be issuedsuch sales.

In addition, the Company and the Seller entered into a restrictive covenant agreement (the “Restrictive Covenant Agreement”) whereby Seller will agree to refrain from competing with the Company and soliciting the Company’s employees at the time of the closing and for a period of time thereafter in order to protect the Company’s legitimate business interests and goodwill in connection with the conversionAsset Purchase Agreement.

Fighter Base Technologies Asset Purchase

On May 2, 2022, the Company completed the acquisition of certain of the HotPlay Convertible Notes, cannot (i) exceed 19.9%assets of Fighter Base Publishing Inc. (“FBP”), an entity owned and controlled by Mark Vange, the Company Chief Technology Officer, pursuant to that Intellectual Property Purchase Agreement entered into by and between the Company and FBP on August 19, 2021. As consideration for the assets of FBP, the Company issued FBP 1,666,667 shares of Company common stock.

The assets purchased from FBP include the AI-powered video development platform of Make It Games (“MIG”), previously a wholly owned division of FBP. The platform includes proprietary technology that enables developers to create video games powered by AI. The technology supports the training of virtual characters to be more lifelike in appearance and behavior. Proprietary AI animation tools help program game or film characters to fully animate themselves, saving as much as 70% of the outstandingtypical time and cost of animation.

Token IQ Asset Purchase

On May 2, 2022, the Company completed the acquisition of 100% of the assets of Token IQ Inc. (“Token IQ”), an entity owned and controlled by Mark Vange, the Company Chief Technology Officer, pursuant to that Intellectual Property Purchase Agreement entered into by and between the Company and Token IQ on August 19, 2021. As consideration for the assets of Token IQ, the Company issued Token IQ 1,250,000 shares of Company common stockstock.

The assets purchased from Token IQ focus on the date of the applicable note, (ii) exceed 19.9% of the combined voting power of the then outstanding voting securities ofdigital assets industry, allowing the Company onto provide its customers with KYC related services, as well as a solution to replace their digital assets should they lose access to, or control of, their digital assets, amongst other things. The foundational intellectual property purchased from Token IQ is designed to reconcile legal and regulatory requirements around digital assets, including KYC, Anti-money laundering and shareholder rights enforcement, all common pain points within the date of the applicable note, in each of subsections (i) and (ii) before the issuance of the common stock under such notes, or (iii) otherwise exceed such number of shares of common stock that would violate applicable listing rules of The NASDAQ Capital Market in the event the Company’s stockholders do not approve the issuance of the common stock (as applicable, the “NASDAQ Limitation”).crypto markets today.

December 2020Financings

May 2021 Underwritten Offering

On December 28, 2020,May 13, 2021, the Company entered into an underwriting agreement (the ““May 2021 Underwriting Agreement”Agreement”) with Kingswood, Capital Markets, division of Benchmark Investments, Inc. (“Kingswood”) and Aegis Capital Corp. (“Aegis”), as representatives of the underwriters namenamed therein (the “Underwriters”“Underwriters”), pursuant to which the Company agreed to sell to the Underwriters in a firm commitment underwritten public offering (the “Offering”) an aggregate of 3,080,000 shares of the Company’s common stock, at a public offering price of $2.50 per share. The Company also granted the underwriters a 45-day option to purchase up to an additional 462,000 shares of common stock to cover over-allotments, if any, which over-allotment option was fully exercised on January 13, 2021. The Offering closed on December 31, 2020.

Kingswood and Aegis acted as the book-running managers for the Offering. The shares of common stock sold in the Offering were offered and sold by the Company pursuant to an effective shelf registration statement on Form S-3. The Company paid the Underwriters a cash fee equal to 6% of the aggregate gross proceeds received by the Company in connection with the Offering, paid the Underwriters a non-accountable expense allowance equal to 1% of the aggregate gross proceeds received by the Company in connection with the Offering, and reimbursed certain expenses of the Underwriters.

The net proceeds to the Company from the Offering, after deducting the underwriting discounts and commissions and Offering expenses, were approximately $7.1 million. The Company intends to use the net proceeds from the Offering to accelerate Longroot Thailand’s internet coin offering platform and our NextTrip platform and call center, to repay outstanding debt obligations (certain of which have already been paid, as discussed above), to pay outstanding obligations owed pursuant to prior acquisition agreements, for the potential acquisition of additional ownership interests in Axion and/or Longroot Cayman (of which additional interests have been purchased as described above), for general corporate purposes and working capital.

Pursuant to the Underwriting Agreement, the Company agreed, subject to certain exceptions, not to offer, issue or sell any shares of common stock or securities convertible into or exercisable or exchangeable for shares of common stock for a period of thirty days following the Offering without the prior written consent of Kingswood and Aegis.

In connection with the Offering, each of our officers, directors, and certain holders of our outstanding securities agreed, subject to certain exceptions, not to offer, issue, sell, contract to sell, encumber, grant any option for the sale of or otherwise dispose of any shares of our common stock or other securities convertible into or exercisable or exchangeable for shares of our common stock for a period of thirty days after the Offering is completed, without the prior written consent of Kingswood and Aegis.

Letter of Intent to Acquire Axion shares

On October 28, 2020, the Company entered into a non-binding Letter of Intent (as amended by the first amendment thereto dated March 10,“May 2021 the “Letter of Intent”) with Radiant Ventures Limited, which manages Radiant VC1 Limited and Radiant PV 1 Limited, two stockholders of Axion, which entity the Company acquired approximately 33.85% of (provided that such ownership of Axion has not been formally transferred to the Company to date) on November 16, 2020, as discussed above.

Pursuant to the Letter of Intent, the Company agreed, subject to certain condition precedents, including regulatory approvals and the entry into material agreements with the sellers, to acquire approximately 12 million shares of Axion, equal to 5.7% of Axion’s outstanding shares, from the stockholders for approximately $2 million, payable in a combination of stock and cash. In connection with our entry into the Letter of Intent, we paid the sellers a $500,000 non-refundable deposit towards the cash purchase price of the shares in or around October 2020 (representing 25% of such purchase price). We also issued the sellers 235,000 shares of common stock in March 2021, representing an additional 25% of the purchase price. Both payments are non-refundable. A final payment of 50% of the purchase price is due 10 days after the British Columbia Securities Commission (BCSC) lifts a cease trade order on Axion’s shares and is payable at the option of the sellers in cash or shares of the Company’s common stock, based on a 20% discount to the Company’s stock price at the time the election to take such final payment in shares is made, provided that such stock price valuation will not be less than $2.00 per share and not more than $3.00 per share. The Letter of Intent terminates if the final payment has not been made by the earlier of June 30, 2021 and 15 days after the BCSC lifts the Axion no trade order. The purchase is also contingent on the sellers granting the Company a proxy to vote the shares to be purchased of Axion through closing. The purchase remains subject to the negotiation of, and entry into, a definitive purchase agreement with the sellers, as well as other closing conditions, which have not been entered into and/or which have not been completed, to date.

Longroot Stock Purchase Agreement

As discussed above under “Cryptocurrency Portal”, on November 16, 2020, Monaker acquired 100% of Longroot, which in turn owned 57% of Longroot Cayman. Longroot Cayman owns 49% of the outstanding ordinary shares (with 51% of the Preferred shares owned by two Thai citizen nominee shareholders) of Longroot Thailand, provided that Longroot Cayman controls 90% of Longroot Thailand’s voting shares and therefore effectively controls Longroot Thailand.

The acquisition was made pursuant to the November 2, 2020 Stock Purchase Agreement (the “SPA”) entered into between the Company and Dr. Jason Morton (“Morton”), and for certain limited purposes set forth therein, Longroot. Pursuant to the SPA, the Company purchased, 100% of Longroot, in consideration for (a) $1,650,000 in cash; (b) 200,000 shares of restricted common stock valued at $2.14 per share for a total value of $428,000, as well as 150,000 shares of restricted common stock valued at $3.00 per share, for a total value of $450,000. A total of $100,000 was paid as a non-refundable deposit towards the purchase of Longroot on October 15, 2020, and a total of $700,000 was paid at the closing on November 16, 2020, along with the issuance of the 200,000 shares. Additionally, prior to the closing, the Company advanced a separate $400,000 to Longroot which was used for working capital prior to closing which brought the purchase price to a total of $2.1 million of cash (without taking into account the value of the shares). The remaining $900,000 owed to Morton pursuant to the terms of the SPA (the “Remaining Cash Payments”) was payable in three installments of $300,000 each, due on or prior to (i) December 16, 2020 (30 days after the closing), which amount has been paid in full; (ii) March 16, 2021 (120 days after the closing); and (iii) April 15, 2021 (150 days after the closing). Pursuant to the SPA, Morton had the option to elect to receive any or all of the Remaining Cash Payments in shares of common stock of the Company, with such number of shares issuable based on a Company stock price of $3.00 per share.

The Company provided Morton demand registration rights in connection with shares of restricted common stock of the Company held by Morton, provided that Morton is not authorized to request more than one demand registration in any 12-month period. In the event such demand registration right is exercised, the Company has 60 days to file a registration statement to register the shares demanded to be registered and is required to use commercially reasonable best efforts thereafter to gain effectiveness of such registration statement, with all fees being paid for by the Company. The demand registration right has no expiration date.

Effective on December 11, 2020, the Company entered into a letter agreement with Morton, which revised the terms of the SPA. Pursuant to the letter agreement, we agreed to accelerate the payment of an aggregate of $150,000 of the $300,000 which was payable pursuant to the terms of the SPA on or prior to April 15, 2021 (which amount was promptly paid), in consideration for Morton agreeing to withdraw a prior demand he had made for the Company to file a registration statement to register the 200,000 shares of common stock previously issue to Morton pursuant to the terms of the SPA. We also agreed to file a registration statement to register the initial 200,000 shares issued no later than January 31, 2021, which Registration Statement on Form S-3 was timely filed on January 29, 2021 and has been declared effective by the SEC to date.

On January 5, 2021, the Company, through Longroot, subscribed to purchase an additional 100 shares of Longroot Cayman, in consideration for $1 million. The subscription was made pursuant to certain pre-emptive rights set forth in a shareholders’ agreement entered into between the shareholders of Longroot Cayman, and increased Longroot’s ownership of Longroot Cayman up to 75%.

On March 19, 2021, Morton exercised his option to receive the remaining consideration due to him in shares of common stock, and the Company issued Morton 150,000 shares of restricted common stock in full satisfaction of the final amounts due.

A total of 22.9% of Longroot Cayman is owned by Axion Interactive Inc. (BVI), of which Axion, holds a 100% interest. Monaker currently owns approximately 33.85% of Axion’s shares.

Currently Longroot owns an approximate 36.75% indirect interest in Longroot Thailand, due to its ownership of 75% of Longroot Cayman, which in turn owns 49% of Longroot Thailand (75% x 49% = 36.75%)), provided that Longroot Cayman controls 90% of Longroot Thailand’s voting shares and therefore effectively controls Longroot Thailand.

Longroot Thailand is an Initial Coin Offering (ICO) portal operator authorized and regulated under Thai Digital Asset Business Law and licensed by the Thai Securities and Exchange Commission. Longroot Thailand provides fully regulated and licensed digital assets financing, and investment services for digital assets. The Company believes that this innovative new business model opens the door to new financing mechanisms, and new investment products. Monaker, as a majority stakeholder in Longroot Thailand, is planning to use the technology and digital asset capabilities to create cryptocurrencies regulated under Thai law, designed to allow consumers to invest in unique revenue streams in wholesale travel, real estate homes and hotels, gaming assets and digital advertising – as well as potential token and loyalty program opportunities complementary to Monaker’s gaming and travel businesses.

Reinhart Interactive TV AG and Zappware N.V. Acquisition

On January 15, 2021, we entered into a Founding Investment and Subscription Agreement (the “Investment Agreement”) with Reinhart Interactive TV AG, a company organized in Switzerland (“Reinhart”), and Jan C. Reinhart, the founder of Reinhart (“Founder”).

The Investment Agreement contemplated the Company acquiring 51% of the ownership of Reinhart, in consideration for 10,000,000 Swiss Francs (approximately $10.8 million US). The closing of the transactions contemplated by the Investment Agreement was to take place on April 1, 2021, or earlier if the conditions to closing were earlier satisfied. Conditions to closing included the Company paying the required capital contribution, approval of the transaction by the board of directors of the Company and Reinhart, and certain requirements and confirmations required by Swiss law. The Investment Agreement included customary representations and warranties of the parties. We also agreed to reimburse the Founder’s legal fees of up to 30,000 Swiss Francs (approximately $33,670) in connection with the transaction. Additionally, in the event we failed to close the transactions contemplated by the Investment Agreement by April 1, 2021, we agreed to pay the Founder 500,000 Swiss Francs (approximately $560,000), as a break-up fee.

We closed the transactions contemplated by the Investment Agreement on March 31, 2021, by paying the Founder $10.8 million in cash. The consideration paid to the Founder came largely from funds advanced by HotPlay pursuant to HotPlay Notes.

Reinhart is in the business of providing a software-based TV and video distribution platform to telecom operators and digital content owners and providing services to telecom operators and digital content owners for user interaction design, as well as software development, deployment and support.

In connection with our entry into the Investment Agreement, we entered into a Founding Shareholders’ Agreement with the Founder (the “Shareholders’ Agreement”). The Shareholders’ Agreement set forth certain rules for the governance and control of Reinhart. The Shareholders’ Agreement provides that the board of directors of Reinhart will consist of five members, three of which will be appointed by the Founder and other shareholders of Reinhart, and two of which will be appointed by the Company which include William Kerby, the Company’s Chief Executive Officer, and Mark Vange, the Chief Technology Officer of HotPlay; that any material shareholder matters are required to be approved by shareholders holding at least 66 2/3% of the total outstanding vote of Reinhart; that in the event Reinhart issues, within five years after the closing date, any equity or convertible equity, with a price less than the most recent valuation of Reinhart’s shares, the shares held by each director who is appointed by the Founder are subject to weighted average anti-dilution protection; provides for various restrictions on transfers of shares of Reinhart, including right of first refusal rights, tag-along rights, and drag-along rights, as well as certain rights which would trigger the right of the other parties to the Shareholders’ Agreement to acquire the shares held by an applicable shareholder, for the higher of the fair market value and the nominal value of the shares (except in the case of (c) where the purchase price is the lower of such amounts), if such shareholder (a) commits a criminal act against the interests of another party, Reinhart or its affiliates; (b) breaches the Shareholders’ Agreement, and fails to cure such breach 20 days after notice thereof is provided; or (c) the employment of any employed shareholder is terminated for certain reasons.

The Shareholders' Agreement also provides a right for the Founder and any other persons appointed as directors by the Founder to put their shares to the Company, at which time the Company will be required to purchase such shares (the “Founder’s Shares”), based on the following schedule:

The Shareholders’ Agreement also allows the parties to file for an initial public offering on a Swiss trading exchange. The Shareholders’ Agreement has a term of 10 years, extendable thereafter for successive five-year periods, unless terminated by either party with 12 months prior written notice (provided that any such termination shall only be applicable to the terminating shareholder), subject to earlier termination in connection with certain initial public offerings.

Warrant Grants

On or around March 19, 2021 and March 22, 2021, the Company issued warrants to purchase an aggregate of 160,000 shares of common stock to seven warrant holders (all unrelated third parties) in consideration for the immediate exercise of newly granted warrants. The warrants replaced prior warrants which had expired in 2020 (which had exercise prices from between $3.75 and $5.00 per share) and had an exercise price of $2.00 per share and an expiration date on March 31, 2021 (the “New Warrants”). Those warrants were subsequently exercised for cash on or around March 31, 2021, and the Company received cash of $320,000 in connection with such exercises. The 160,000 shares of common stock issuable upon exercise thereof were issued on or around April 1, 2021. The Company has agreed to register the shares of common stock issuable upon exercise of the warrants in the future.

Warrant Exchanges

On or around March 19, 2021 and March 22, 2021, the Company exchanged warrants to purchase an aggregate of 51,900 shares of common stock held by two of the same warrant holders who were granted New Warrants, which had an exercise price of $5.13 per share and an expiration date of July 30, 2022, for new warrants had an exercise price of $2.00 per share and an expiration date on March 31, 2021 (the “Exchanged Warrants”). Those warrants were subsequently exercised for cash on or around March 31, 2021, and the Company received cash of $103,800 in connection with such exercises. The 51,900 shares of common stock issuable upon exercise thereof were issued on or around April 1, 2021. The Company has agreed to register the shares of common stock issuable upon exercise of the warrants in the future.

Streeterville Note Purchases

On March 22, 2021, we entered into a Note Purchase Agreement dated March 23, 2021 (the “March 2021 Note Purchase Agreement”) with Streeterville Capital, LLC (“Streeterville”), an accredited investor, pursuant to which the Company sold Streeterville a Secured Promissory Note in the original principal amount of $9,370,000 (the “March 2021 Streeterville Note”). Streeterville paid consideration of (a) $7,000,000 in cash; and (b) issued the Company a promissory note in the amount of $1,500,000 (the “March 2021 Investor Note”), in consideration for the March 2021 Streeterville Note, which included an original issue discount of $850,000 (the “OID”) and reimbursement of Streeterville’s transaction expenses of $20,000. A total of $700,000 of the OID is fully earned and the remaining $150,000 is not fully earned until the March 2021 Investor Note is fully-funded by Streeterville, which March 2021 Investor Note was fully funded on May 26, 2021.

The March 2021 Streeterville Note bears interest at a rate of 10% per annum and matures 12 months after its issuance date (i.e., on March 23, 2022). From time to time, beginning six months after issuance, Streeterville may redeem a portion of the March 2021 Streeterville Note, not to exceed $2.125 million. 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 March 2021 Streeterville Note. Under certain circumstances, the Company may defer the redemption payments up to three times, for 30 days each, provided that upon each such deferral the outstanding balance of the March 2021 Streeterville Note is increased by 2%. Subject to the terms and conditions set forth in the March 2021 Streeterville Note, the Company may prepay all or any portion of the outstanding balance of the March 2021 Streeterville Note at any time subject to a prepayment penalty equal to 10% of the amount of the outstanding balance to be prepaid. For so long as the March 2021 Streeterville Note remains outstanding, the Company has agreed to pay to Streeterville 20% of the gross proceeds that the Company receives from the sale of any of its common stock or preferred stock, which payments will be applied towards and will reduce the outstanding balance of the March 2021 Streeterville Note, which percentage increases to 30% upon the occurrence of, and continuance of, an event of default under the March 2021 Streeterville Note (each an “Equity Payment”). Each time that we fail to pay an Equity Payment, the outstanding balance of the March 2021 Streeterville Note automatically increases by 10%. Additionally, in the event we fail to timely pay any such Equity Payment, Streeterville may seek an injunction which would prevent us from issuing common or preferred stock until or unless we pay such Equity Payment.

The March 2021 Streeterville Note provides that if any of the following events have not occurred on or before June 30, 2021, the then outstanding balance of the note (including accrued and unpaid interest) increases by an amount equal to 25% of the then-current outstanding balance thereof: (a) HotPlay must have become a wholly-owned subsidiary of the Company; (b) during the period beginning on July 21, 2020, and ending on the date that the HotPlay Share Exchange is consummated, HotPlay must have raised at least $15,000,000 in cash or debt through equity investments (which has been completed); (c) upon consummation of the HotPlay Share Exchange, all outstanding debt owed by the Company to HotPlay must have either been forgiven by HotPlay or converted into the Company’s common stock; and (d) HotPlay must have become a co-borrower on the March 2021 Streeterville Note (collectively, the “March 2021 Note Transaction Conditions”).

The March 2021 Note Purchase Agreement required that we complete the purchase of the Reinhart Interactive TV AG equity interests discussed below (the “Reinhart Interest”), within ten days of the date of the sale of the March 2021 Streeterville Note, and that the Company pledge the Reinhart Interest to Streeterville pursuant to a pledge agreement thereafter, both of which were timely completed.  

In addition to the March 2021 Streeterville Note, the Company previously sold Streeterville 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 included an original issue discount of $500,000 and reimbursement of Streeterville’s transaction expenses of $20,000. A total of $350,000 of the OID was fully earned and the remaining $150,000 was not fully earned until or unless the November 2020 Investor Note was fully-funded by Streeterville, which November 2020 Investor Note was fully funded on January 6, 2021. 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 $1.25 million. The November 2020 Streeterville Note and purchase agreement has substantially similar terms as the March 2021 Streeterville Note and purchase agreement, in regard to required redemptions, penalties, required equity payments and events of default. The November 2020 Streeterville Note has a current balance of approximately $2.39 million. We made a required monthly redemption payment of $1,250,000 to Streeterville under the November 2020 Streeterville Note on May 26, 2021, with funds obtained pursuant to the May 2021 Underwritten Offering discussed below. At the same time, Streeterville waived the requirement that we use 20% of the funds obtained pursuant to the May 2021 Underwritten Offering to pay down amounts owed under the November 2020 Streeterville Note, contingent upon our payment of 20% of the proceeds from our May 2021 underwritten offering towards the balance of the March 2021 Streeterville Note, which amount was subsequently paid as discussed below.

The November 2020 Streeterville Note provided that if any of the following events had not occurred on or before April 30, 2021, the then outstanding balance of the note (including accrued and unpaid interest) increases by an amount equal to 25% of the then-current outstanding balance thereof (the “April 2021 Note Increase”): (a) HotPlay must have become a wholly-owned subsidiary of the Company; (b) during the period beginning on July 21, 2020, and ending on the date the HotPlay Share Exchange is consummated, HotPlay must have raised at least $15,000,000 in cash through equity investments; (c) upon consummation of the HotPlay Share Exchange, all outstanding debt owed by the Company to HotPlay must have either been forgiven by HotPlay or converted into the Company’s common stock; (d) HotPlay must have become a co-borrower on the November 2020 Streeterville Note; and (e) the Company must have paid off all outstanding debt obligations to the Donald P. Monaco Insurance Trust and National Bank of Commerce, in full (collectively, the “November 2020 Note Transaction Conditions”). To date, the Company has not yet completed the acquisition of HotPlay, and as such, the November 2020 Note Transaction Conditions have not been met.

On June 1, 2021, Streeterville agreed to defer 50% of the April 2021 Note Increase which was otherwise to occur due to the Company’s failure to timely meet all of the November 2020 Note Transaction Conditions. As such, a total of $506,085 has been capitalized into the outstanding balance of the November 2020 Streeterville Note effective as of April 30, 2021, and the remaining $506,085 of the April 2021 Note Increase will only be added to the balance of the November 2020 Streeterville Note if the Company fails to meet the November 2020 Transaction Conditions by June 30, 2021. Separately, if the Company does not meet the March 2021 Note Transaction Conditions by June 30, 2021, the March 2021 Streeterville Note will be subject to the June 2021 Note Increase.

Also on May 26, 2021, Streeterville funded the March 2021 Investor Note (in the amount of $1.5 million) in full.

We made a required equity payment of $1,857,250 to Streeterville under the March 2021 Streeterville Note on May 26, 2021, with funds raised through the May 2021 underwritten offering, which represented approximately 20% of the funds raised in such offering.

IFEB Bank Transaction

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 pursuant to which the Company agreed to purchase 2,191,489 shares (the “IFEB Shares”) of authorized and outstanding Class A Common 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 IFEB Shares total approximately 57.1% of the outstanding Class A Common Stock of IFEB. The purchase price of the IFEB Shares was $6,400,000, which amount was paid to the 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 license #51. As a result, IFEB is regulated by OCIF, and intends to update its application to establish a Fedwire account with the Federal Reserve Bank, New York (“FRB”). IFEB conducts its business activities out of its head office in Puerto Rico at 268 Ponce de Leon Ave., in San Juan.

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 IFEB Shares to the Company and the Company’s acquisition of control of IFEB is subject to review of the Company’s financial viability, as well as other matters, by OCIF. The Company anticipates completing acquisition of the IFEB Shares in or around June 2021.

On May 6, 2021, in anticipation of the acquisition of the 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 IFEB Preferred Shares will have a coupon of 2% per annum, payable in quarterly installments in arrears. The IFEB Preferred Shares will be redeemable by the Company; however, IFEB may, by the vote of the holders of a majority of its outstanding common stock, call and redeem the IFEB Preferred Shares in exchange for the Monaker Shares, plus accrued interest on the IFEB Preferred Shares at the time of any such redemption; and upon a Change of Control (defined below), the Company may cause IFEB to repurchase the IFEB Preferred Shares in exchange for the Monaker Shares, plus accrued interest at the time of any such Change of Control. “Change of Control” means the sale of all or substantially all the assets of IFEB; any merger, consolidation or acquisition of IFEB with, by or into another corporation, entity or person; or any change in the ownership of more than fifty percent (50%) of IFEB’s voting securities or the economic rights of such IFEB’s securities.

The closing of the transactions contemplated by the Preferred Exchange Agreement, including the issuance of the Monaker Shares and IFEB Preferred Shares, are subject to various closing conditions, including, but not limited to IFEB receiving approval from OCIF to issue preferred stock (including the Series A preferred shares), and 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. If not closed by June 30, 2021, the Preferred Exchange Agreement can be terminated by either party with written notice to the other.

Convertible Promissory Notes

On April 8, 2021, the Company entered into an Exchange Agreement with William Kerby, its Chief Executive Officer and director and Monaco Investment Partners II, LP (“MI Partners”), of which Donald P. Monaco is the managing general partner and the Chairman of the board of directors of the Company (the “Exchange Agreement”). Pursuant to the Exchange Agreement, the terms of which were approved by the board of directors of the Company, Mr. Kerby and MI Partners exchanged their right to an aggregate of $1,016,314 in accrued dividends (the “Accrued Dividends”) which had accrued on the Company’s outstanding Series A Preferred Stock, which had been held by Mr. Kerby and MI Partners prior to the conversion of such Series A Preferred Stock into common stock of the Company in August 2017, for Convertible Promissory Notes. Specifically, Mr. Kerby exchanged rights to $430,889 of accrued dividends on the Series A Preferred Stock for a Convertible Promissory Note with a principal balance of $430,889 and MI Partners exchanged rights to $585,425 of accrued dividends on the Series A Preferred Stock for a Convertible Promissory Note with a principal balance of $585,425 (the “Convertible Promissory Notes”).

The Convertible Promissory Notes accrue interest at the rate of 12% per annum, compounded monthly at the end of each calendar month, with such interest payable at maturity or upon conversion. The principal and accrued interest owed under the Convertible Promissory Notes is convertible, at the option of the holders thereof, into shares of the Company’s common stock, at any time beginning seven days after the date the HotPlay Exchange Agreement closes and prior to the payment in full of such Convertible Promissory Notes by the Company, at a conversion price equal to the greater of (i) the closing consolidated bid price of the Company’s common stock on April 8, 2021 (which was $3.02); and (ii) the five-day volume weighted average price of the Company’s common stock for the five trading days following the date that the HotPlay Exchange Agreement closes. The Convertible Promissory Notes are unsecured, have a maturity date of April 7, 2022, and include standard and customary events of default. 

May 2021 Underwritten Offering

On May 13, 2021, the Company entered into an underwriting agreement (the “May 2021 Underwriting Agreement”) with Kingswood, as representatives of the underwriters named therein (the “Underwriters”), pursuant to which the Company agreed to sell to the Underwriters in a firm commitment underwritten public offering (the “May 2021 Offering”Offering”) an aggregate of 3,230,000 shares of the Company’s common stock at a public offering price of $2.50 per share. The Company also granted the underwriters a 45-day option to purchase up to an additional 484,500 shares of common stock to cover over-allotments, if any, which over-allotment option was exercised in full. The May 2021 Offering (including the sale of the over-allotment shares) closed on May 18, 2021. The net proceeds to the Company from the May 2021 Offering, after deducting the underwriting discounts and commissions and offering expenses, were approximately $8.5 million.

Kingswood acted as sole book-running managers for the May 2021 Offering. The Company paid the Underwriters a cash fee equal to 6% of the aggregate gross proceeds received by the Company in connection with the May 2021 Offering, paid the Underwriters a non-accountable expense allowance equal to 1% of the aggregate gross proceeds received by the Company in connection with the May 2021 Offering, and reimbursed certain expenses of the Underwriters.

November Registered Direct Offering

On November 1, 2021, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with certain institutional investors (the “Purchasers”), pursuant to which the Company agreed to issue and sell, in a registered direct offering, an aggregate of 18,987,342 shares (the “Shares”) of the Company’s common stock, together with warrants to purchase an aggregate of 14,240,508 shares of Common Stock (the “Warrants”), at a combined price of $1.58 per Share and accompanying three quarters of a Warrant. The net proceeds to the Company from the May 2021 Offering,offering, after deducting the underwriting discountsplacement agent fees and commissionsexpenses and estimated offering expenses (excluding proceeds to the Company, if any, from the future exercise of the Warrants) were approximately $8.5$27.85 million.

The offering closed on November 3, 2021. The Shares, Warrants and shares of common stock issuable upon exercise of the Warrants were offered pursuant to a prospectus supplement, filed with the SEC on November 3, 2021, to the Company’s effective shelf registration statement on Form S-3 (File No. 333-257457), which was initially filed with the SEC on June 25, 2021, was amended on September 24, 2021 and October 27, 2021, and was declared effective on October 29, 2021.

Each whole Warrant sold in the offering will be exercisable for one share of common stock at an initial exercise price of $1.97 per share (the “Initial Exercise Price”), the closing sales price of the Company’s common stock on October 29, 2021 (the last trading day prior to the date that the Purchase Agreement was entered into). The Warrants may be exercised commencing six months after the issuance date (the “Initial Exercise Date”) and terminating on the fifth anniversary of the Initial Exercise Date. The Warrants are exercisable for cash; provided, however that they may be exercised on a cashless exercise basis if, at the time of exercise, there is no effective registration statement registering, or no current prospectus available for, the issuance or resale of the shares of common stock issuable upon exercise of the Warrants. The exercise of the Warrants will be subject to a beneficial ownership limitation, which will prohibit the exercise thereof, if upon such exercise the holder of the Warrants, its affiliates and any other persons or entities acting as a group together with the holder or any of the holder’s affiliates would hold 4.99% (or, upon election of a purchaser prior to the issuance of any shares, 9.99%) of the number of shares of the common stock outstanding immediately after giving effect to the issuance of shares of common stock issuable upon exercise of the Warrant held by the applicable holder, provided that the holders may increase or decrease the beneficial ownership limitation (up to a maximum of 9.99%) upon 61 days advance notice to the Company, which 61 day period cannot be waived.

The Warrants also include certain anti-dilution rights, which provide that if at any time the Warrants are outstanding, the Company issues or enters into any agreement to issue, or is deemed to have issued or entered into an agreement to issue (which includes the issuance of securities convertible or exercisable for shares of common stock), securities for consideration less than the then current exercise price of the Warrants, the exercise price of such Warrants will be automatically reduced to the lowest price per share of consideration provided or deemed to have been provided for such securities; provided, however, that unless and until the Company has received stockholder approval to reduce the exercise price of the Warrants below $1.97 per share (the “Floor Price”), no such adjustment to the exercise price may be made. Pursuant to the Purchase Agreement, the Company agreed to use its reasonable best efforts to obtain stockholder approval within 90 days from the date of the prospectus supplement to remove the Floor Price of the Warrants. Until such shareholder approval is obtained, the Company has agreed to hold a special meeting of its stockholders every three months thereafter, for so long as the Warrants remain outstanding, to obtain such stockholder approval.

If the Company fails for any reason to deliver shares of common stock upon the valid exercise of the Warrants, subject to its receipt of a valid exercise notice and the aggregate exercise price, by the time period set forth in the Warrants, the Company will be required to pay the applicable holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of shares subject to such exercise (as calculated in the Warrant), $10 per trading day (increasing to $20 per trading day on the third trading day after such liquidated damages begin to accrue) for each trading day that such shares are not delivered. The Warrants also include customary buy-in rights in the event the Company fails to deliver shares of common stock upon exercise thereof within the time periods set forth in the Warrant.

EF Hutton, division of Benchmark Investments, LLC (“EFH”), agreed to act as placement agent for the offering on a “reasonable best efforts” basis. Pursuant to the placement agency agreement entered into with EFG, the Company paid EFH an aggregate cash fee equal to 6.0% of the aggregate gross proceeds of the offering, a non-accountable expense reimbursement of 1.0% of the aggregate gross proceeds in the offering, and $50,000 for the reimbursement of certain of the EFH’s expenses.

At The Market Offering Agreement Facility

On March 4, 2022, the Company entered into an At The Market Offering Agreement (the “ATM Agreement”) with H.C. Wainwright & Co., LLC (the “Agent”), to create an at-the-market equity program under which the Company may, from time to time, offer and sell shares of its common stock having an aggregate gross offering price of up to $20 million (the “Shares”) to or through the Agent (the “ATM Offering”).

Any Shares sold to or through the Agent will be issued pursuant to a prospectus dated October 29, 2021 and a prospectus supplement dated March 4, 2022 filed with the SEC (the “Prospectus Supplement”), in connection with one or more offerings of the Shares pursuant to the Prospectus Supplement. Subject to the terms and conditions of the ATM Agreement, the Agent will use its commercially reasonable efforts consistent with its normal trading and sales practices and applicable state and federal law, rules and regulations to sell the Shares from time to time, based upon the Company’s instructions. Sales of the Shares, if any, under the ATM Agreement may be made in transactions that are deemed to be “at the market offerings” as defined in Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”), including sales made by means of ordinary brokers’ transactions (including directly on the Nasdaq Capital Market), at market prices or as otherwise agreed between the Company and the Agent. The Agent is not under any obligation to purchase any of the Shares on a principal basis pursuant to the ATM Agreement, except as otherwise agreed by the Agent and the Company in writing pursuant to a separate terms agreement. The Company intendshas no obligation to usesell any of the Shares and may at any time suspend offers under the ATM Agreement or terminate the ATM Agreement. As compensation for services provided, if any, the Agent will be entitled to a commission at a fixed commission rate equal to 3.0% of the gross sales price of any Shares sold in the ATM Offering.

Note Purchase Agreements: Streeterville Capital, LLC

November 2020 Note Purchase Agreement

On November 23, 2020, the Company entered into a Note Purchase Agreement (the “November 2020 Note Purchase Agreement”) with Streeterville Capital, LLC (“Streeterville”), pursuant to which the Company sold Streeterville a Secured Promissory Note in the original principal amount of $5,520,000 (the “November 2020 Streeterville Note”). Streeterville paid consideration of an initial cash purchase price of $3,500,000 for the note and issued the Company a promissory note in the amount of $1,500,000 (the “November 2020 Investor Note”). The associated debt issuance costs of the note were $370,000 for total amount due $3,870,000. In addition to the $370,000 of debt issuance costs, the Company paid $245,000 for advisory fees, resulting in net proceeds fromto the May 2021 OfferingCompany of $3,255,000.

The November 2020 Investor Note, in the principal amount of $1,500,000, evidenced the amount payable by Streeterville to repay approximately $4.2 million owed to Streeterville, provide capital to IFEB in advancethe Company as partial consideration for the acquisition by the Company of the closingNovember 2020 Streeterville Note. The November 2020 Investor Note accrued interest at the rate of 10% per annum, payable in full on November 23, 2021, subject to a 30-day extension exercisable at the option of Streeterville and could be prepaid at any time. The amount of the Investor Note has been offset against the amount of the November 2020 Streeterville Note in the balance sheet as of February 28, 2021, as both notes have substantially similar terms, and the Investor Note was provided in consideration for the acquisition of control of IFEB (which acquisition is pending, subject to closing conditions, and may not be completely timely, if at all), for general corporate purposes and working capital or for other purposes that the board of directors, in their good faith, deems to be in the best interest of the Company. We may also use all or a portion of the November 2020 Streeterville Note. The November 2020 Investor Note was subsequently funded in full in January 2021.

On November 4, 2021, upon completion of the November 2021 registered direct offering (discussed above), the Company completely paid off the November 2020 Streeterville Note in the amount of $3,100,807.

March 2021 Note Purchase Agreement

On March 22, 2021, the Company entered into a Note Purchase Agreement dated March 23, 2021 (the “March 2021 Note Purchase Agreement”) with Streeterville, pursuant to which the Company sold Streeterville a Secured Promissory Note in the original principal amount of $9,370,000 (the “March 2021 Streeterville Note”). Streeterville paid consideration of (a) $7,000,000 in cash; and (b) issued the Company a promissory note in the amount of $1,500,000 (the “March 2021 Investor Note”), in consideration for the March 2021 Streeterville Note, which included an original issue discount of $850,000 (the “OID”) and reimbursement of Streeterville’s transaction expenses of $20,000. A total of $700,000 of the OID was fully earned upon issuance and the remaining net$150,000 was not fully earned until the March 2021 Investor Note was fully-funded by Streeterville, which occurred on May 26, 2021. Also on May 26, 2021, Streeterville funded the March 2021 Investor Note (in the amount of $1.5 million) in full.

The March 2021 Streeterville Note bore interest at a rate of 10% per annum and matures 12 months after its issuance date (i.e., on March 23, 2022). From time to time, beginning six months after issuance, Streeterville had the right to redeem a portion of the March 2021 Streeterville Note, not to exceed $2.125 million. In the event we did not pay the amount of any requested redemption within three trading days, an amount equal to 25% of such redemption amount was to be added to the outstanding balance of the March 2021 Streeterville Note. Under certain circumstances, the Company had the right to defer the redemption payments up to three times, for 30 days each, provided that upon each such deferral the outstanding balance of the March 2021 Streeterville Note would increase by 2%. Subject to the terms and conditions set forth in the March 2021 Streeterville Note, the Company could prepay all or any portion of the outstanding balance of the March 2021 Streeterville Note at any time subject to a prepayment penalty equal to 10% of the amount of the outstanding balance to be prepaid. For so long as the March 2021 Streeterville Note remained outstanding, the Company agreed to pay to Streeterville 20% of the gross proceeds that the Company received from the sale of any of its common stock or preferred stock, which payments were applied towards and reduced the outstanding balance of the March 2021 Streeterville Note, which percentage would increase to 30% upon the occurrence of, and continuance of, an event of default under the March 2021 Streeterville Note (each an “Equity Payment”). The outstanding balance of the March 2021 Streeterville Note would have automatically increased by 10% each time that we failed to pay an Equity Payment. Additionally, in the event we failed to timely pay any such Equity Payment, Streeterville had the right to seek an injunction which would prevent us from issuing common or preferred stock until or unless we pay such Equity Payment.

The March 2021 Note Purchase Agreement required that we complete the purchase of the Reinhart Interactive TV AG equity interests discussed below (the “Reinhart Interest”), within ten days of the date of the sale of the March 2021 Streeterville Note, and that the Company pledge the Reinhart Interest to Streeterville pursuant to a pledge agreement thereafter, both of which were timely completed. 

The Company made a required equity payment of $1,857,250 to Streeterville under the March 2021 Streeterville Note on May 26, 2021, with funds raised through a May 2021 underwritten offering, which represented approximately 20% of the funds raised in such offering. On November 4, 2021, the Company paid down the outstanding balance of the March 2021 Streeterville Note, with funds raised through the November 2021 registered direct offering (discussed above).

October 2021 Note Purchase Agreement

On October 22, 2021, the Company entered into the Note Purchase Agreement (the “October 2021 Note Purchase Agreement”) with Streeterville, pursuant to which the Company sold Streeterville a Secured Promissory Note in the original principal amount of $1,665,000 (the “October 2021 Streeterville Note”). Streeterville paid consideration of $1,500,000, which represents the original principal amount less a $150,000 OID, which was fully earned upon issuance, and a total of $15,000 to cover Streeterville’s professional fees and transaction expenses.

The October 2021 Streeterville Note bears interest at a rate of 10% per annum and matures 12 months after its issuance date (i.e., on October 22, 2022). From time to time, beginning six months after issuance, Streeterville may redeem any portion of the October 2021 Streeterville Note, up to a maximum amount of $375,000 per month. In the event the Company fails to 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 October 2021 Streeterville Note. Under certain circumstances, the Company may defer the redemption payments up to three times, for 30 days each, provided that upon each such deferral, the outstanding balance of the October 2021 Streeterville Note is increased by 2%. Subject to the terms and conditions set forth in the October 2021 Streeterville Note, the Company may prepay all or any portion of the outstanding balance of the October 2021 Streeterville Note at any time subject to a prepayment penalty equal to 10% of the amount of the outstanding balance to be prepaid. For so long as the October 2021 Streeterville Note remains outstanding, the Company has agreed to pay to Streeterville 20% of the gross proceeds that the Company receives from the sale of any of its common stock or preferred stock within ten days of receiving such amount, which payments will be applied towards and will reduce the outstanding balance of the October 2021 Streeterville Note, which percentage increases to 30% upon the occurrence of, and continuance of, an event of default under the October 2021 Streeterville Note (each an “Equity Payment”). Each time that the Company fails to pay an Equity Payment, the outstanding balance of the October 2021 Streeterville Note automatically increases by 10%. Additionally, in the event the Company fails to timely pay any such Equity Payment, Streeterville may seek an injunction which would prevent the Company from issuing common or preferred stock until or unless the Company paid all past-due Equity Payments.

Pursuant to the October 2021 Streeterville Note, the Company provided Streeterville a right of first refusal to purchase any promissory note, debenture, or other debt instruments which the Company proposes to sell, other than sales to officers or directors of the Company and/or sales to the government. Each time, if ever, that the Company provides Streeterville such right, and Streeterville does not exercise such right to provide such funding, the outstanding balance of the October 2021 Streeterville Note increases by 3%, unless the proceeds from such sale(s) are used to repay the October 2021 Streeterville Note in full. Each time, if ever, that the Company fails to comply with the terms of the right of first refusal, the outstanding balance of the October 2021 Streeterville Note increases by 10%. Additionally, upon each major default described in the October 2021 Streeterville Note (i.e., the failure to pay amounts under the October 2021 Streeterville Note when due or to observe any covenant under the Note Purchase Agreement (other than the requirement to make Equity Payments)), the outstanding balance of the October 2021 Streeterville Note may be increased, at Streeterville’s option, by 15%, and for each other default, the outstanding balance of the October 2021 Streeterville Note may be increased, at Streeterville’s option, by 5%, provided such increase can only occur three times each as to major defaults and minor defaults, and that such aggregate increase cannot exceed 30% of the balance of the October 2021 Streeterville Note immediately prior to the first event of default.

The October 2021 Note Purchase Agreement and the October 2021 Streeterville Note contain customary events of default, including if the Company undertakes a fundamental transaction (including consolidations, mergers, and certain changes in control of the Company), without Streeterville’s prior written consent. As described in the October 2021 Streeterville Note, upon the occurrence of certain events of default (mainly our entry into bankruptcy), the outstanding balance of the October 2021 Streeterville Note will become automatically due and payable. Upon the occurrence of other events of default, Streeterville may declare the outstanding balance of the October 2021 Streeterville Note immediately due and payable at such time or at any time thereafter. After the occurrence of an event of default (and upon written notice from Streeterville), interest on the October 2021 Streeterville Note will accrue at a rate of 22% per annum, or if lesser, the maximum rate permitted under applicable law. The October 2021 Note Purchase Agreement prohibits Streeterville from shorting our stock through the period that Streeterville holds the October 2021 Streeterville Note.

As of February 28, 2022, the remaining principal balance of Streeterville Notes was $4,053,737, plus accrued interest of $653,587.

On May 5, 2022, the Company and Streeterville entered into a Standstill Agreement, pursuant to which Streeterville agreed that it will not seek to redeem any portion of the October 2021 Streeterville Note before September 18, 2022. As consideration for such agreement, the outstanding balance of the October 2021 Streeterville Note was increased by approximately $87,639, resulting in an updated outstanding balance of approximately $1,840,913 as of such date. Pursuant to Standstill Agreement, in the event of a default by the Company under the October 2021 Streeterville Note, the Standstill Agreement shall terminate immediately. Except as provided herein, the Standstill Agreement does not impact or alter the terms of the October 2021 Streeterville Note or the October 2021 Purchase Agreement, both of which remain in full force and effect.

More information regarding this offering (aftertransaction is disclosed in Note 9 – Notes Payable.

May 2022 Streeterville Note Purchase

On May 5, 2022 (the “Effective Date”), the payments described above)Company entered into a new Note Purchase Agreement (the “May 2022 Note Purchase Agreement”) with Streeterville, pursuant to fund possible investmentswhich the Company sold Streeterville a Secured Promissory Note in or acquisitionsthe original principal amount of complementary businesses, technologies or products; however, we currently have no definitive agreements or commitments$2,765,000 (the “May 2022 Streeterville Note”). Streeterville paid consideration of $2,500,000, which amount represents the original principal amount less a $250,000 OID, which was fully earned upon issuance, and a total of $15,000 to cover Streeterville’s professional fees and transaction expenses incurred in connection with respect to any investment or acquisition.the transaction.

The May 2022 Streeterville Note bears interest at a rate of 10% per annum and matures 12 months after its issuance date (i.e., on May 5, 2023). From time to time, beginning six months after issuance, Streeterville may redeem any portion of the May 2022 Note, up to a maximum amount of $625,000 per month. In the event the Company fails to 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 May 2022 Note. Under certain circumstances, the Company may defer the redemption payments up to three times, for 30 days each, provided that upon each such deferral, the outstanding balance of the May 2022 Note is increased by 2%.

Subject to the terms and conditions set forth in the May 2022 Note, the Company may prepay all or any portion of the outstanding balance of the May 2022 Note at any time subject to a prepayment penalty equal to (i) 5% of the amount of the outstanding balance to be prepaid if such prepayment is made on or before six months from the Effective Date and (ii) 10% of the amount of the outstanding balance to be prepaid if such prepayment is made after six months from the Effective Date. For so long as the May 2022 Note remains outstanding, the Company has agreed to pay to Streeterville 20% of the gross proceeds that the Company receives from the sale of any of its common stock or preferred stock within ten days of receiving such amount, which payments will be applied towards and will reduce the outstanding balance of the May 2022 Note, which percentage increases to 30% upon the occurrence of, and continuance of, an event of default under the May 2022 Note (each an “Equity Payment”). Each time that the Company fails to pay an Equity Payment, the outstanding balance of the May 2022 Note automatically increases by 10%. Additionally, in the event the Company fails to timely pay any such Equity Payment, Streeterville may seek an injunction which would prevent the Company from issuing common or preferred stock until or unless the Company paid all past-due Equity Payments.

Additionally, upon each major default described in the May 2022 Note (including, without limitation, the failure to pay amounts under the May 2022 Note when due or to observe any covenant under the May 2022 Purchase Agreement (other than the requirement to make Equity Payments)), the outstanding balance of the May 2022 Note may be increased, at Streeterville’s option, by 15%, and for each other default, the outstanding balance of the May 2022 Note may be increased, at Streeterville’s option, by 5%, provided such increase can only occur three times each as to major defaults and minor defaults, and that such aggregate increase cannot exceed 30% of the balance of the May 2022 Note immediately prior to the first event of default.

The May 2022 Purchase Agreement and the May 2022 Note contain customary events of default, including if the Company undertakes a fundamental transaction (including consolidations, mergers, and certain changes in control of the Company), without Streeterville’s prior written consent. Pursuant to the May 2021 Underwriting Agreement,2022 Note, upon the Company agreed, subject tooccurrence of certain exceptions, not to offer, issue or sell any sharesevents of common stock or securities convertibledefault (mainly our entry into or exercisable or exchangeable for sharesbankruptcy), the outstanding balance of common stock for a period of 45 days following the May 2021 Offering, without2022 Note will become automatically due and payable. Upon the prioroccurrence of other events of default, Streeterville may declare the outstanding balance of the May 2022 Note immediately due and payable at such time or at any time thereafter. After the occurrence of an event of default (and upon written consentnotice from Streeterville), interest on the May 2022 Note will accrue at a rate of Kingswood.

22% per annum, or if lesser, the maximum rate permitted under applicable law. The May 2022 Purchase Agreement prohibits Streeterville from shorting our stock through the period that Streeterville holds the May 2022 Note.

The May 2022 Purchase Agreement also provides for cross-indemnification by the parties in the event that they incur loss or damage related to, among other things, a breach of applicable representations, warranties, or covenants under the May 2022 Purchase Agreement.

In connection with the May 2021 Offering, each of our officers2022 Purchase Agreement and directors agreed, subject to certain exceptions, not to offer, issue, sell, contract to sell, encumber, grant any option for the sale of or otherwise dispose of any shares of our common stock or other securities convertible into or exercisable or exchangeable for shares of our common stock for a period of 45 days after the May 2021 Offering is completed, without2022 Note, the prior written consentCompany entered into a Security Agreement with Streeterville, pursuant to which the obligations of Kingswood.the Company are secured by substantially all of the assets of the Company.

IDS Settlement

On August 15, 2019, the Company entered into an Intellectual Property Purchase Agreement (“and the “IP Purchase Agreement”) with IDS Inc. (“IDS” and the “IP Purchase Agreement”IDS”). Pursuant to the agreement,IP Purchase Agreement, the Company purchased certain proprietary technology from IDS for the reservation and booking of air travel, hotel accommodations, car rentals, and ancillary products, services, and amenities, integration of the same with the providers of such products and services, associated functions, including website addresses, patents, trademarks, copyrights and trade secrets relating thereto, and all goodwill associated therewith (collectively, the “IP Assets”“IP Assets”). In consideration for the purchase, the Company issued IDS 1,968,000 shares of restricted common stock (the “IDS Shares”“IDS Shares”) valued at $2.50 per share, or $4,920,000$4.9 million in aggregate.

On April 27, 2020, the Company filed a verified complaint for injunctive relief against IDS and TD Assets Holding, LLC (“TD Asset”Asset”), Navarro McKown, Aaron McKown and Ari Daniels (“Daniels”Daniels”), which parties are affiliated with IDS, in the Circuit Court of the Seventeenth Judicial Circuit in and for Broward County, Florida (Case No. CACE-20-007088). Pursuant to the complaint, the Company alleged causes of action against the defendants, including IDS, based on among other things, fraud, conspiracy to commit fraud, aiding and abetting fraud, rescission, and breach of contract, and sought a temporary and permanent injunction against the defendants, requiring such persons to return the 1,968,000 IDS Shares issued pursuant to the terms of the IP Purchase Agreement and preventing such persons from selling or transferring any IDS Shares, sought damages from the defendants, rescission of the IP Purchase Agreement, attorneys fees and other amounts. The defendants subsequently filed various counterclaims against the Company.

The complaint was filed because of IDS’sIDS’ failure to deliver the IP Assets, certain other actions of IDS and the other of the defendants which the Company alleged constituted fraud. The Company sought to unwind the IP Purchase Agreement and sought damages for the Company due to IDS’sIDS’ and the other defendants’ breaches thereunder. IDS, through its counsel, sent a letter threatening to bring a shareholders’ derivative action and/or direct suit against the Company. In response to such letter, the Company’s board of directors empowered the governance committee to conduct an internal investigation into the claims. The results of the investigation, conducted by several law firms, were presented to the BoardCompany’s board and the Boardboard concluded that no fraudulent activities occurred. The investigation concluded in October 2020.

On April 29, 2020, the Company filed a Verified Motion for Temporary Injunction (the “Injunction Motion”“Injunction Motion”). Defendants IDS, TD Assets, and Ari Daniels filed an answer, affirmative defenses, and counterclaims (the “Answer“Answer and Counterclaim”Counterclaim”). The Answer and Counterclaim included alleged breach of contract and tort claims against the Company. On September 17, 2020, the Company moved to strike the affirmative defenses and dismiss the counterclaims. On October 15, 2020, defendants IDS, TD Assets, and Ari Daniels filed an amended Answer and Counterclaim, including alleged breach of contract, tort, and federal securities claims against the Company, Mr. William Kerby, our Chief Executive Officer and an employee of the Company.

On July 27, 2020, the Company entered into a confidential settlement agreement with certain of the defendants in the IDS matter, Navarro Hernandez, P.L., Aaron M. McKown, and Jeffery S. Bailey. The settlement provided for mutual releases of the parties and amounts payable from such parties to the Company in four tranches, in consideration for such settlement, of which all such payments have been timely paid pursuant to the terms of the settlement.

The remaining parties to the litigation subsequently attempted to mediate their pursuant to a court ordered mediation in February 2021.

Effective on May 18, 2021, the Company, IDS, TD Asset and Ari Daniels, the principal of IDS, entered into an Amendment to Intellectual Property Purchase Agreement (the “IP“IP Purchase Amendment”Amendment”). Pursuant to the IP Purchase Agreement,Amendment, the parties amended the IP Purchase Agreement, with the Company agreeing to make a payment to IDS in the amount of $2,850,000$2.85 million (the “Payment”“Payment”), payable by way of an initial payment of $500,000,$0.5 million, and twelve monthly payments of approximately $195,833$0.2 million (collectively, the “Required Payments”“Required Payments”), with such monthly payments beginning 30 days after the initial payment, which is due seven days after the date of the IP Purchase Amendment, and has been paid to date.Amendment. Such monthly payments may be pre-paid at any time without penalty. At the Company’s option, any portion of the amount due may be paid to IDS by a party separate from the Company (either a related party of Monakerthe Company or a third-party) (a “Paying Party”“Paying Party”), for the benefit of Monaker,the Company, which shall be treated for all purposes as a payment by Monaker.the Company. As consideration for such Paying Party making such payment on behalf of Monaker,the Company, IDS agreed to transfer the Paying Party a number of the IDS Shares equal to the amount of the cash payment(s) made by a Paying Party multiplied by 0.6888 as to the first $500,000$0.5 million payment, (which payment has been made, but which shares have not been transferred to the Company to date), and 0.691 as to the monthly payments (as applicable, the “Applicable Portion”“Applicable Portion” of the IDS Shares).

In the event the Company fails to make any payment timely, and the Company does not cure such default within seven days of written notice of default being provided by IDS, IDS is entitled to entry of a default judgment against the Company in the amount of the differential, if any, between the realized value of the IDS Shares upon the future sale thereof in the open market by IDS, and the unpaid amount of any payment due. In the event of any such default, IDS will be entitled to attorneys’ fees incurred to obtain said judgment.

Upon each payment of amounts due to IDS pursuant to the terms of the IP Agreement Amendment, as discussed above, by Monakerthe Company (instead of a Paying Party), IDS agreed to transfer the portion of the IDS Shares equal to the Applicable Portion, to the Company.

Until such time as the IDS Shares are no longer held by IDS, IDS agreed not to transfer or encumber any of such shares, except pursuant to the terms of the IP Purchase Amendment.

IDS also agreed to transfer certain unbranded travel videos back to the Company which were previously purchased by IDS from Monaker, pursuantPursuant to the IP Purchase Agreement.

A further requirement of the IP Purchase Amendment, was that IDS enter into a Shareholder Voting Representation Agreement with William Kerby, our Chief Executive Officer and director (the “Shareholder Voting Agreement”), which was entered into effective on May 18, 2021. Pursuant to the Shareholder Voting Agreement, IDS provided Mr. Kerby the right to, and an irrevocable proxy to, vote all of the IDS Shares held by IDS at any meeting of stockholders of the Company and/or via any written consent of stockholders of the Company. The Shareholder Voting Agreement remains in place until the earlier of the fifth anniversary of the Shareholder Voting Agreement; the disposition of the IDS Shares pursuant to the IP Purchase Amendment; a change of control of Monaker resulting in persons prior to such transaction obtaining more than 50% voting control of the Company following such transaction; the sale of all or substantially all of the assets of the Company; or termination of the agreement by Mr. Kerby. Mr. Kerby may also assign his rights under the agreement to another party and/or the Company may assign Mr. Kerby’s rights under the agreement if Mr. Kerby is unable to make such assignment due to his death or disability. Mr. Kerby was provided the voting rights as the shareholder representative of, and for the benefit of, the Company.

Also effective on May 18,19, 2021, the Company IDS, TD Assetmade the initial payment of $0.5 million. Thereafter, the first 344,400 shares of common stock repurchased by the Company were returned to treasury and Ari Daniels,cancelled.

On September 27, 2021, the Court entered into a Confidential Settlement Agreementthe Agreed Order. The Court ordered that:

As of February 28, 2022 and Mutual Release, whereby (a) we provided a general release to IDS, TD Asset and Mr. Daniels, and (b) IDS, TD Asset and Mr. Daniel provided a general release to us;through the parties agreed to file a Joint Notice of Voluntary Dismissal to dismiss the pending lawsuit discussed above; and the parties agreed that a prior Web Based Booking Engine Development Agreement dated October 24, 2017, was terminated.

We expect the parties to the litigation above to file a joint notice for voluntary dismissal of the lawsuit shortly after thefiling date of this Report.

Recent Issues Surrounding the COVID-19 Pandemic

In December 2019, a novel strain of coronavirus, which causes the infectious disease known as COVID-19, was reported in Wuhan, China. The World Health Organization declared COVID-19 a “Public Health Emergency of International Concern” on January 30, 2020 and a global pandemic on March 11, 2020. In March and April, many U.S. states and local jurisdictions began issuing ‘stay-at-home’ orders. For example, the state of Florida, where the Company’s principal business operations are, issued a ‘stay-at-home’ order effective on April 1, 2020, which remained in place, subject to certain exceptions, through June 2020, when the order was gradually lifted. Since that time the U.S., and Florida in particular, have seen rapid increases in the spread of COVID-19. It is currently unclear whether the state of Florida, or the other states, countries or other jurisdictions in which we provide travel services, will issue new or expanded ‘stay-at-home’ orders, or how those orders, or others, may affect our operations and/or results of operations, notwithstanding the current roll-out of COVID-19 vaccines. It is also too early to determine how effective the available vaccines will be to curb the spread or effects of COVID-19, or how many persons will choose to receive the vaccine.