| ORGANIZATION AND NATURE OF BUSINESS | Note
1: ORGANIZATION AND NATURE OF BUSINESS Organization
Lazex Inc. (“Lazex”) was incorporated under the laws of the State of Nevada on July 12, 2015. On August 23, 2019, the majority
owner of Lazex entered into a Stock Purchase Agreement with Slinger Bag Americas Inc., a Delaware corporation (“Slinger Bag Americas”),
which was 100 2,500 332,239 2,500 100 2,500 82 On
October 31, 2019, Slinger Bag Americas acquired control of Slinger Bag Canada, Inc., (“Slinger Bag Canada”) a Canadian company
incorporated on November 3, 2017. There were no assets, liabilities or historical operational activity of Slinger Bag Canada. On
February 10, 2020, Slinger Bag Americas became the 100 Effective
February 25, 2020, the Company increased the number of authorized shares of common stock from 75,000,000 300,000,000 300,000,000 1,000,000,000 On
June 21, 2021, Slinger Bag Americas entered into a membership interest purchase agreement with Charles Ruddy to acquire a 100 On
February 2, 2022, the Company entered into a share purchase agreement with Flixsense Pty, Ltd. (“Gameface”). As a result
of the share purchase agreement, Gameface became a wholly owned subsidiary of the Company. On
February 22, 2022, the Company entered into a merger agreement with PlaySight Interactive Ltd. (“PlaySight”) and Rohit Krishnan
(the “Shareholders’ Representative”). As a result of the merger agreement, PlaySight would become a wholly owned subsidiary
of the Company. During
April 2022, the Company determined that the technology utilized in the Foundation Sports acquired entity would take substantially more
financial resources and more time to bring to market and achieve profitability than originally anticipated. As a result, the goodwill
and intangible assets related to Foundation Sports were fully impaired as of April 30, 2022, resulting in an impairment loss of $ 3,486,599 75 In
April 2022, the Company changed its domicile from Nevada to Delaware. On April 7, 2022, the Company effected a name change to Connexa
Sports Technologies Inc. We also changed our ticker symbol, “CNXA”. Connexa is now the holding company under which Slinger
Bag and Gameface reside. The
operations of Slinger Bag Inc., Slinger Bag Americas, Slinger Bag Canada, Slinger Bag UK, SBL and Gameface are collectively referred
to as the “Company.” On
June 14, 2022, the Company effected a 1-for-10 reverse stock split On
November 17, 2022, Gabriel Goldman and Rohit Krishnan resigned from the Board of Directors of the Company. Gabriel and Rohit were
members of the audit and compensation committees. Gabriel Goldman was a member of the Company’s Nominating and Corporate Governance
Committee. Neither Gabriel nor Rohit advised the Company of any disagreement with the Company on any matter relating to its operations,
policies or practices. On
November 27, 2022, the Company entered into a share purchase agreement (the “Agreement”) with PlaySight, Chen Shachar and
Evgeni Khazanov (together, the “Buyer”) pursuant to which the Buyer purchased 100 100 600,000 800,000 2
(i) A
promissory note in the amount of U.S. $ 2
(ii) The
maturity date of the Promissory Note was December 31, 2023 subject to a one year extension in the discretion of the Buyer until
December 31, 2024. The Buyer timely elected to extend the maturity date of the Promissory Note to December 31, 2024.
(iii) The
Promissory Note can be partially paid over the time, but in the event it is not paid in full by December 31, 2024, then the
remaining amount due (i.e., U.S. $ 2
(iv) The
number of the Deposited Shares will be determined according to the post-money valuation of the last investment round of the Company,
and in the absence of such investment round, the total number of the Deposited Shares will be $ 2 The
Company has also released PlaySight from all of its obligations (except for those created by the Agreement) in respect of the Company,
including any inter-company debts on the books, and the Buyer has released the Company from all of its obligations (except for those
created by the Agreement) in respect of PlaySight and the Buyer. The
reason for the entry into the Agreement and the transactions contemplated thereby was to eliminate the need for the Company to provide
further financing for PlaySight’s operations. On
December 5, 2022, the Company assigned 75 25 500,000 500,000 7 On
March 7, 2023, Slinger Bag entered into an exclusive distribution agreement for Padel Tennis with a company located in Valencia, Spain
called with Desarrollo y Promocion de Padel S.L. This agreement is contracted to deliver approximately $ 15 On
September 13, 2023 the Company held a special meeting of stockholders in which the following items were approved: (i)
the issuance of (i) 1,274 shares of the our common stock, par value $0.001 per share, that were issued on October 3, 2023, and, (ii)
14,753 shares of our common stock issuable upon exercise of Pre-Funded Warrants at an exercise price of $0.00002 per share, (iii) 16,026
shares of common stock issuable upon the exercise of 5-Year Warrants at an exercise price of $312 per share, (iv) 32,052 shares of common
stock issuable upon the exercise of 7.5 Year Warrants at an exercise price of $344 per share and (v) 22,625 shares of our common stock
issuable upon the exercise of 5.5 Year Warrants at an at an exercise price per share equal to $1,768per share to Armistice Capital Master
Fund Ltd and (ii) a reverse stock split of our common stock within a range of 1-for-10 to 1-fo-40 (“Reverse Stock
Split”), with the Board of Directors of the Company to set the specific ratio and determine the date for the reverse split to be
effective and any other action deemed necessary to effectuate the Reverse Stock Split, without further approval or authorization of stockholders,
at any time within 12 months of the special meeting date. On
September 25, 2023, as a result of the shareholder approval obtained at the special meeting of stockholders on September 13, 2023 and
the Reverse Stock Split, the aggregate number of Pre-Funded Warrants, 5-Year Warrants, 5.5-Year Warrants and 7-Year Warrants increased
from 85,455 to 471,348 due to certain adjustments that were required to be made by the terms of the relevant warrants in the event of
receipt of shareholder approval and the occurrence of the Reverse Stock Split. On
November 16, 2023, the Company entered into an agreement with Agile Capital Funding (the “ACF Agreement”) pursuant to which
the Company sold $ 693,500 450,000 28,895.83 In
order to secure payment and performance of the Company’s obligations to ACF under the ACF Agreement, the Company granted to ACF
a security interest in the following collateral: all present and future accounts receivable. The Company also agreed not to create, incur,
assume, or permit to exist, directly or indirectly, any lien on or with respect to any of such collateral. As
previously disclosed on the Current Report on Form 8-K furnished with the SEC on September 9, 2020, the Company entered into a service
agreement dated September 7, 2020 (the “YK Employment Agreement”) with Yonah Kalfa, the Company’s chief innovation
officer and member of the Company’s board of directors. Pursuant to Sections 2.1(a) and 2.1(b) of the YK Employment Agreement,
the Company owes Mr. Kalfa $ 1,137 The
Company was unable to pay Mr. Kalfa any of the compensation in cash and, given Mr. Kalfa’s extraordinary contribution to the Company,
pursuant to Section 2.1(b) of the YK Employment Agreement, on January 20, 2024 the Company agreed to pay $ 1 1.137 137,000 267,380 3.74 Due
to administrative delays, the Company did not issue the shares in January. Rather, on March 15, 2024, the Company issued 220,265 1 4.54 No
shareholder approval was required for the issuance of the 220,265 4.54 The
Company sought and obtained shareholder approval, pursuant to Nasdaq Listing Rule 5635(c), to issue the balance of 47,115 267,380 220,265 The
Shares were issued on May 24, 2024 without registration under the Securities Act of 1933, as amended (the “Securities Act”),
in reliance on the exemption provided by Section 4(a)(2) of the Securities Act as a transaction not involving a public offering. On
January 20, 2024, the Company agreed to issue to Mike Ballardie, the Company’s chairman of the board and chief executive officer,
warrants to purchase 317,514 0.02 10 Acquisition
and Recent Transactions On
March 18, 2024, the Company entered into a share purchase agreement (the “Share Purchase Agreement”) and a share exchange
agreement (the “Share Exchange Agreement,” and together with the Share Purchase Agreement, the “Agreements”)
to acquire a total of 70 56 55.8 The
Acquisition Structure Pursuant
to the Share Purchase Agreement, the Company agreed to purchase, and the Seller agreed to sell, 2,000 20 16,500,000 Pursuant
to the Exchange Agreement, the Company has agreed to purchase, and the Seller has agreed to sell, 5,000 50 8,127,572 55.8 The
Exchange Shares will be issued without registration under the Securities Act, in reliance upon a safe harbor for offshore transactions
or an exemption from registration for transactions not involving a public offering and, as such, will constitute “restricted securities”
within the meaning of Rule 144 under the Securities Act. Under Rule 144, the Exchange Shares generally may not be offered or sold publicly
unless they have been held for at least six months and subject to other conditions. Separation
Agreement In
connection with the Exchange Transaction, the Company has agreed that at or prior to the closing date of the Acquisition (the “Closing
Date”), it will enter into a separation agreement to sell, transfer and assign all or substantially all of its legacy business,
assets and liabilities related to or necessary for the operations of its “Slinger Bag” business or products (the “Legacy
Business”) to a newly established entity (“NewCo”), and that after the Closing Date, NewCo will have the sole right
to and obligations of the Legacy Business and will be liable to the Company for any losses arising from third-party claims against the
Company that arise from liabilities related to the Legacy Business (the “Separation”). NewCo will be owned by Yonah Kalfa
and Mike Ballardie. On
a pro forma basis, as of April 30, 2024, the Legacy Business’ assets were approximately $ 5.1
million (which represents the assets of the Company
as of January 31, 2024, minus, on a pro forma basis, the $ 16.5
million used for the purchase of 20 %
ownership of YYEM in April 2024), and the liabilities of the Legacy Business were $ 12.0
million (which represents the liabilities of
the Company as of April 30, 2024). Financial
Accommodations As
an inducement to the Company to complete the Transactions, the Agreements provide that aggregate payments of (a) $4,500,000 shall be
made to the Company in cash by YYEM and (b) $500,000 shall be made to NewCo (as defined under the header “The Separation Agreement”)
in cash by YYEM, as follows: (i) $800,000 payable within two (2) business days of the date of the Agreements; (ii) $1,200,000 payable
within three (3) business days of the Company changing its ticker symbol from “CNXA” to “YYAI,” or such other
symbol as the parties may agree; (iii) $2,000,000 payable at the Closing and (iv) $500,000 to be paid within 30 days from the Closing
Date and paid to NewCo. Out of the $4,500,000, the Company paid $2,142,857 to certain companies for arranging the Transactions. Management
following the Acquisition At
or after the Closing, the board of directors of Connexa (the “Board of Directors” or the “Board”) shall
comprise those individuals designated by YYEM Seller, and all current members of the Board shall resign with such resignation being effective
on the later of the Closing or the appointment or election of the new directors. Closing
Conditions The
Share Exchange, as amended, provides that:
● on
or before the Closing Date, the Company shall obtain approval from holders of shares of Common Stock for the Share Exchange Transaction
and other matters related to the Share Exchange Transaction. Such stockholder approval was received on May 15, 2024;
● on
or before the Closing Date, the Company shall obtain approval from Nasdaq for the Reverse Stock Split of the Common Stock at a ratio
to be determined by the parties;
● as
a condition to Closing, from the date of the Exchange Agreement through the Closing Date, the existing shares of Common Stock shall
have been continually listed on Nasdaq, and the Company shall have not received a determination from Nasdaq indicating that the Common
Stock will be delisted from Nasdaq; and
● the
Company and YYEM shall cooperate to effectuate a reverse stock split, obtain approval from Nasdaq of a new listing application to
be submitted to Nasdaq in connection with the Share Exchange Transaction, and provide such information as is necessary for the Company
to obtain shareholder approval of the Share Exchange Transaction and other matters relating thereto. The shareholder approval was
obtained on May 15, 2024, and a new listing application was submitted to Nasdaq in May 2024, which is currently under review by Nasdaq. We
cannot provide assurance as to when, or if, all of the closing conditions will be satisfied or waived by the relevant party. As of the
date of this prospectus, we have no reason to believe that any of the conditions will not be satisfied. Closing
Deliverables At
the Closing, the Company shall deliver to YYEM Seller the following:
● copies
of all resolutions of the Board of Directors authorizing the execution, delivery, and performance of the Exchange Agreement
and the other agreements, instruments, and documents required to be delivered in connection with the Exchange Agreement or at the
Closing to which the Company is a party and the consummation of the transactions contemplated hereby and thereby;
● the
Exchange Shares;
● all
documents, instruments, agreements and certificates that may be deliverable in connection with the performance or fulfilment of the
conditions under Section 6.01 and Section 6.03 of the Exchange Agreement that are relevant to the Company;
● a
duly executed bought and sold note, as applicable; and
● all
other documents, instruments and writings which may be reasonably requested by YYEM Seller to be delivered by the Company at or prior
to the Closing pursuant to the Exchange Agreement. At
the Closing, YYEM Seller shall deliver to the Company the following:
● payment
of the Closing Cash Payment (as defined in the Exchange Agreement);
● a
good standing certificate (or its equivalent) for YYEM from the relevant governmental authority of Hong Kong, if applicable, and
each other jurisdiction where YYEM is qualified, registered, or authorized to do business, if any;
● if
the YYEM shares are represented by certificates, such certificates duly endorsed for transfer by YYEM Seller, as applicable;
● a
counterpart to any consents required in connection with the transactions contemplated by the Exchange Agreement;
● all
documents, instruments, agreements and certificates that may be deliverable in connection with the performance or fulfilment of the
conditions under Section 6.01 and Section 6.02 of the Exchange Agreement that are relevant to YYEM Seller;
● a
duly executed bought and sold note as may be required under the law of Hong Kong; and
● all
other documents, instruments and writings which may be reasonably requested by YYEM Buyer to be delivered by YYEM Seller and YYEM
at or prior to the Closing pursuant to the Exchange Agreement. Termination The
Exchange Agreement may be terminated by mutual written consent of the Company and the YYEM Seller at any time before the Closing or by
either the Company or the YYEM Seller at any time before the Closing if the Share Exchange Transaction has not been consummated by the
date that is 180 days from the date of the Exchange Agreement (the “Termination Date”) or if any party breaches the Exchange
Agreement with respect to the closing conditions and such breaches cannot be cured by the Termination Date. If the Exchange Agreement
is terminated by the Company unilaterally and of its own volition other than due to the aforementioned termination conditions, the Company
shall be liable for a termination fee in the amount of three times the fees and costs incurred by the YYEM Seller in connection with
the Share Exchange Transaction up to a maximum amount in the aggregate of $ 600,000 Reverse
Stock Split The
Company’s Board of Directors and stockholders have approved the Proposed Reverse Stock Split of its Common Stock within
a range of 1-for-10 to 1-for-100 ,
with the Board having set the specific ratio at 1-20 and determined the date for the Proposed Reverse Stock Split to be effective to
be June 27, 2024. Meged
Agreements On
June 8, 2023, the Company entered into a merchant cash advance agreement with Meged Funding Group (“Meged”) pursuant to which
the Company sold $ 315,689 210,600 10,580 17,538 On
September 19, 2023, the Company entered into an agreement with Meged (the “Second Meged Agreement”) pursuant to which the
Company sold $ 423,000 70,153 15,107 In
order to secure payment and performance of the Company’s obligations to Meged under the Second Meged Agreement, the Company granted
to Meged a security interest in all accounts receivable and all proceeds therefrom as such term is defined by Article 9 of the Uniform
Commercial Code (UCC). The Company also agreed not to create, incur, assume, or permit to exist, directly or indirectly, any lien on
or with respect to any of such collateral. UFS
Agreement On
August 7, 2023, the Company entered into an agreement with UFS (the “UFS Agreement”) pursuant to which the Company sold $ 797,500 550,000 50,000 30,000 In
order to secure payment and performance of the Company’s obligations to UFS under the UFS Agreement, the Company granted to UFS
a security interest in all accounts receivable and all proceeds therefrom as such term is defined by Article 9 of the Uniform Commercial
Code (UCC). The Company also agreed not to create, incur, assume, or permit to exist, directly or indirectly, any lien on or with respect
to any of such collateral. Special
Meeting of Stockholders On
September 13, 2023 the Company held a special meeting of stockholders in which the following items were approved: (i) the issuance of
(i) 1,274 shares of the our common stock, par value $0.001 per share, that were issued on October 3, 2023, and, (ii) 14,753 shares of
our common stock issuable upon exercise of Pre-Funded Warrants at an exercise price of $0.00002 per share, (iii) 16,026 shares of common
stock issuable upon the exercise of 5-Year Warrants at an exercise price of $312 per share, (iv) 32,052 shares of common stock issuable
upon the exercise of 7.5 Year Warrants at an exercise price of $344 per share and (v) 22,625 shares of our common stock issuable upon
the exercise of 5.5 Year Warrants at an at an exercise price per share equal to $1,768per share to Armistice Capital Master Fund Ltd
and (ii) a reverse stock split of our common stock within a range of one (1)-for-ten (10) to one (1)-for-forty (40) (“Reverse Stock
Split”), with the Board of Directors of the Company to set the specific ratio and determine the date for the reverse split to be
effective and any other action deemed necessary to effectuate the Reverse Stock Split, without further approval or authorization of stockholders,
at any time within 12 months of the special meeting date. On
September 25, 2023, as a result of the shareholder approval obtained at the special meeting of stockholders on September 13, 2023 and
the Reverse Stock Split, the aggregate number of Pre-Funded Warrants, 5-Year Warrants, 5.5-Year Warrants and 7-Year Warrants increased
from 85,455 to 471,348 due to certain adjustments that were required to be made by the terms of the relevant warrants in the event of
receipt of shareholder approval and the occurrence of the Reverse Stock Split. Armistice
Transactions from September 2023 to April 2024 From
September 18, 2023 through April 30, 2024, the Company issued Armistice 473,935 On
October 11, 2023, the Company, the Lenders and the Agent (as defined in the LSA) entered into a loan and security modification agreement
to allow for an additional loan of $ 1,000,000 8,460 138 On
December 6, 2023, the Company entered into an inducement offer letter agreement (the “Inducement Letter”) with Armistice
with regard to certain of the Company’s existing warrants to purchase up to a total of 248,611 70,508 35.46 155,479 70.92 22,625 Pursuant
to the Inducement Letter, Armistice agreed to exercise for cash the 2022 and 2023 Warrants to purchase an aggregate of 248,611 5.88 497,221 1,461,827.68 The
resale of the shares of the Common Stock underlying the 2022 and 2023 Warrants and 224,472 As
of February 21, 2024, the total amount owed pursuant to the Note was $ 3,197,335.65 3 On
February 21, 2024, the Company and the Lenders and the Agent entered into a Waiver, Warrant Amendment and Second Loan and Security Modification
Agreement (the “Waiver, Amendment, and Modification Agreement”). Pursuant
to the Waiver, Amendment, and Modification Agreement, the Lenders and the Agent agreed to waive certain events of default with regard
to certain covenants and obligations the Company had pursuant to (a) that certain registration rights agreement between the Company and
the Lenders and the Agent entered into in September 2022, (b) the LSA (as modified), and (c) the Inducement Letter. Pursuant
to the Waiver, Amendment, and Modification Agreement, the Company and the Lenders and the Agent agreed to modify the Loan and Security
Agreement such that the Note is now convertible into up to 499,584 6.40 6.40 Pursuant
to the Waiver, Amendment, and Modification Agreement, the Lenders and the Agent agreed to use their reasonable best efforts to voluntarily
convert all amounts owed under the Note on or prior to the last trading day before the trading day on which the next meeting of the Company’s
shareholders would take place. Pursuant
to the Waiver, Amendment, and Modification Agreement, the Company and the Lenders and the Agent agreed that following shareholder approval,
which the Company obtained on May 15, 2024, the October Warrants and December Warrants have been amended to lower the exercise price
of such warrants to $ 3.20 Pursuant
to the Waiver, Amendment, and Modification Agreement, the Company agreed that Slinger Bag Americas Inc., a Delaware subsidiary of the
Company (“Slinger”) would, within ten (10) business days of the six month anniversary of the effectiveness of the registration
statement on Form S-1 registering the shares of Common Stock issuable pursuant to the conversion of the Note (the “Effectiveness
Date”), pay in cash to the Lenders and the Agent the difference, if any, between (i) $ 6 2 Pursuant
to the Waiver, Amendment, and Modification Agreement, the Company and the Lenders and the Agent agreed that once the Note was fully repaid
(either via a combination of cash payments and conversions into shares of Common Stock or just via conversions into shares of Common
Stock) all liens and security interests of the Lenders and the Agent in any and all of the property of the Company and the Guarantors
(as defined in the Waiver, Amendment, and Modification Agreement) would be automatically released and terminated, including without limitation,
any liens and security interests evidenced by Uniform Commercial Code financing statements. Pursuant
to the Waiver, Amendment, and Modification Agreement, the Company agreed to prepare and file a registration statement on Form S-1 registering
the shares of Common Stock issuable pursuant to the conversion of the Note with the SEC within five (5) business days of February 21,
2024 and use commercially reasonable best efforts to cause such registration statement to be declared effective by the SEC as soon as
practical thereafter and, in any event, within thirty (30) calendar days of February 21, 2024. A registration statement was filed and
became effective on March 1, 2024 in compliance with this obligation. On
April 15, 2024, the Company acknowledged and agreed to the entrance into a warrant purchase agreement (the “Morgan WPA”)
by Armistice and Morgan Capital LLC (“Morgan”) pursuant to which Armistice sold the October and December 2023 Warrants to
Morgan for $ 2,500,000 6 2,000,000 Amendment
to Bylaws On
October 12, 2023, the Board of Directors of the Company approved an amendment to the Bylaws of the Company to reduce the percentage of
shares of stock, issued and outstanding and entitled to vote, to be present in person or represented by proxy in order to constitute
a quorum for the transaction of any business from a majority to thirty-three and one third percent (33 1/3%) Share
Issuance to Sapir On
November 14, 2023, the Company issued 11,224 127,500 127,500 8,017 3,207 Nasdaq
Compliance On
January 30, 2024, the Company received a letter from the staff of the Nasdaq Stock Market confirming that following the receipt of a
an investment of $ 16.5 It
is further reported that, in application of Listing Rule 5815(d)(4)(B), the Company is also subject to a mandatory panel monitor in respect
of its periodic filing requirements in Listing Rule 5250(c)(1) (the “Periodic Filing Rule”) for a period of one year from
October 11, 2023. If, within that one-year monitoring period, the Staff finds the Company again out of compliance with the Periodic Filing
Rule, notwithstanding Rule 5810(c)(2), the Company will not be permitted to provide Staff with a plan of compliance with respect to that
deficiency and Staff will not be permitted to grant additional time for the Company to regain compliance with respect to that deficiency,
nor will the company be afforded an applicable cure or compliance period pursuant to Rule 5810(c)(3). Instead, Staff will issue a Delist
Determination Letter and the Company will have an opportunity to request a new hearing with the initial Panel or a newly convened Hearings
Panel if the initial Panel is unavailable. The Company will have the opportunity to respond/present to the hearing panel as provided
by Listing Rule 5815(d)(4)(C) and the Company’s securities may at that time be delisted from Nasdaq. On
December 12, 2023, the Company received a letter (the “Notice”) from the Staff informing the Company that because the closing
bid price for the Common Stock listed on Nasdaq was below $ 1.00 30 On
June 11, 2024, the Company received a letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“ Nasdaq 5,000,000 SEC Delisting Determination The Company appealed of the Delisting Determination on June 18, 2024 by
requesting a hearing before the Panel to stay the suspension of the Company’s securities. The hearing panel date was set for July
25, 2024. Through the subsequent filing of the Form 25-NSE with the SEC. On June 27, 2024, the Company effected a 1-20 reverse stock split,
which brought its share price to $ 8.31 1 There
can be no assurance that the Company will be able to satisfy Nasdaq’s continued listing requirements. The
January 2024 Offering On
January 19, 2024, the Company entered into a securities purchase agreement (the “Securities Purchase Agreement”) with three
investors (the “January 2024 Investors”) for the issuance and sale to each investor of (i) 116,510 1,258,490 0.40 16.5 0.0002 349,530 3,775,470 From
April 2024 through May 2024, the Company acknowledged and agreed to the entrance into certain warrant purchase agreements (the “WPAs”)
by the January 2024 Investors and 10 purchasers (the “Pre-Funded Warrants Purchasers”) pursuant to which the January 2024
Investors sold all of the 3,775,470 18,877,350 Share
Issuance to Smartsports On
January 23, 2024, the Company issued 10,000 10,000 Agile Capital LLC Agreement On
January 10, 2024, the Company entered into an agreement with Agile Capital Funding, LLC (the “Agile Jan Agreement”) pursuant
to which the Company sold $ 1,460,000 1,000,000 52,142.86 Cedar
Advance Agreement No.1 On
January 29, 2024, the Company entered into an agreement with Cedar Advance LLC (the “Cedar Agreement”) pursuant to which
the Company sold $ 1,183,200 752,000 39,440 Unique
Funding Solutions Agreement On
March 6, 2024, the Company entered into an agreement (the “UFS Agreement”) with Unique Funding Solutions (“UFS”)
pursuant to which the Company sold $ 323,350 200,000 9,798.49 In
order to secure payment and performance of the Company’s obligations to UFS under the UFS Agreement, the Company granted to UFS
a security interest in all present and future accounts receivable. The Company also agreed not to create, incur, assume, or permit to
exist, directly or indirectly, any lien on or with respect to any of such collateral. Cedar
Advance Agreement No. 2 On
April 3, 2024, the Company entered into an agreement with Cedar (the “Second Cedar Agreement”) pursuant to which the Company
sold $ 438,000 285,000 14,600 In
order to secure payment and performance of the Company’s obligations to Cedar under the Second Cedar Agreement, the Company granted
to Cedar a security interest in all present and future accounts receivable. The Company also agreed not to create, incur, assume, or
permit to exist, directly or indirectly, any lien on or with respect to any of such collateral. Cedar
Advance Agreement No. 3 On
April 22, 2024, the Company entered into an agreement with Cedar (the “Third Cedar Agreement”) pursuant to which the Company
sold $ 481,800 310,200 18,530.77 In
order to secure payment and performance of the Company’s obligations to Cedar under the Third Cedar Agreement, the Company granted
to Cedar a security interest in all present and future accounts receivable. The Company also agreed not to create, incur, assume, or
permit to exist, directly or indirectly, any lien on or with respect to any of such collateral. Operations The
Company operates in the sports equipment and technology business. The Company is the owner of the Slinger Launcher, which is comprised
of a portable tennis ball launcher, a portable padel tennis ball launcher and a portable pickleball launcher and Gameface, providing
AI technology and performance analytics. From
inception to date, we have been focused on the ball sport market globally. Our first product, the Slinger Bag Launcher, is a patented,
highly portable, versatile and affordable ball launcher built into an easy to transport wheeled trolley bag. Tennis
ball machines have been around since the 1950’s when they were introduced by Rene Lacoste. Improvements to performance were made
in the 1970’s when Prince started its tennis business on the back of its first product - Little Prince - which was
a vacuum operated ball machine. In the 1990’s the first battery operated machines came to the market and since that time very little,
if anything, has changed in the structure of ball machines products outside of added computerization. Typically, the machines being marketed
by traditional ball machine brands are large, cumbersome and awkward to operate. They are also generally expensive - often well
above U.S. $ 1,000 700 Recent
Events On
May 15, 2024, the Company held its 2024 annual general meeting of stockholders at which the following items were approved:
1. The
nominations of Mike Ballardie, Yonah Kalfa, Kirk Taylor, Stephen Crummey, and Rodney Rapson
for election as directors at the Annual Meeting until the 2025 annual meeting of stockholders
and until their respective successors are duly elected and qualified.
2. The
appointment of Olayinka Oyebola & Co. to continue as our independent registered public
accounting firm for the fiscal year ended April 30, 2024.
3. The
approval of the issuance of shares of our common stock pursuant to that certain Share Exchange
Agreement dated March 18, 2024 (the “Exchange Agreement”) among the Company,
Mr. Hongyu Zhou (the “YYEM Seller”), and Yuanyu Enterprise Management Co., Limited
(“YYEM”), in exchange for 50 70 55.8 17.6
4. The
amendment to the Company’s certificate of incorporation to increase the authorized
shares of its common stock from 300,000,000 1,000,000,000
5. The
approval of an amendment to the Company’s certificate of incorporation to authorize
a reverse stock split of its common stock within a range of 1-for-10 1-for-100
6. The
approval of the separation of the Company’s “Slinger Bag” business and
products and the transactions contemplated by the separation agreement related to the transaction
contemplated by the Exchange Agreement (the “Share Exchange Transaction”) Once
the Share Exchange Transaction is closed, the current board of directors of the Company will
resign and will appoint YYEM’s slate of directors to the board, which will effe | Note
1: ORGANIZATION AND NATURE OF BUSINESS Organization Lazex
Inc. (“Lazex”) was incorporated under the laws of the State of Nevada on July 12, 2015. On August 23, 2019, the majority
owner of Lazex entered into a Stock Purchase Agreement with Slinger Bag Americas Inc., a Delaware corporation (“Slinger Bag Americas”),
which was 100 50,000 332,239 50,000 100 50,000 82 On
October 31, 2019, Slinger Bag Americas acquired control of Slinger Bag Canada, Inc., (“Slinger Bag Canada”) a Canadian company
incorporated on November 3, 2017. There were no assets, liabilities or historical operational activity of Slinger Bag Canada. On
February 10, 2020, Slinger Bag Americas became the 100 On
June 21, 2021, Slinger Bag Americas entered into a membership interest purchase agreement with Charles Ruddy to acquire a 100 75 On
February 2, 2022, the Company entered into a share purchase agreement with Flixsense Pty, Ltd. (“Gameface”). As a result
of the share purchase agreement, Gameface became a wholly owned subsidiary of the Company. On
February 22, 2022, the Company entered into a merger agreement with PlaySight Interactive Ltd. (“PlaySight”) and Rohit Krishnan
(the “Shareholders’ Representative”). As a result of the merger agreement, PlaySight would become a wholly owned subsidiary
of the Company. In November 2022, the Company sold PlaySight and recorded a loss on the sale. On
May 16, 2022, the Company changed its domicile from Nevada to Delaware. On April 7, 2022, the Company effected a name change to Connexa
Sports Technologies Inc. We also changed our ticker symbol, “CNXA”. On
June 14, 2022, the Company effected a 1-for-10 reverse stock split Although
the Company is currently in compliance with Nasdaq listing requirements, if the Company loses its compliance with the minimum shareholder
equity requirement in Nasdaq Listing Rule 5550(b)(1) (the “Equity Rule”), then, notwithstanding Rule 5810(c)(2), the Company
will not be permitted to provide Nasdaq with a plan of compliance with respect to such deficiency and Nasdaq will not be permitted to
grant additional time for the Company to regain compliance with respect to such deficiency, nor will the Company be afforded an applicable
cure or compliance period pursuant to Rule 5810(c)(3). Instead, Nasdaq will issue a delist determination letter and the Company will
have the opportunity to request a new hearing. The Company will have the opportunity to respond/present to the hearing panel as provided
by Listing Rule 5815(d)(4)(C) and the Company’s securities may at that time be delisted from Nasdaq. On January 19, 2024, the Company entered into a
securities purchase agreement (the “Securities Purchase Agreement”) with three investors (the “January 2024
Investors”) for the issuance and sale to each investor of (i) 116,510 1,258,490 4 16.5 0.0002 349,530 3,775,470 From April 2024 through May 2024, the Company acknowledged and agreed to the entrance into certain warrant purchase
agreements (the “WPAs”) by the January 2024 Investors and 10 purchasers (the “Pre-Funded Warrant Purchasers”)
pursuant to which the January 2024 Investors sold all of the 3,775,470 18,877,350 On
June 27, 2024, the Company (i) increased the number of authorized shares of common stock from 300,000,000 1,000,000,000 1-for-20
reverse stock split On May 28, 2024, the Company filed a registration statement in respect of 1,925,000 349,530 1,575,470 The
Company currently operates in the sport equipment and technology business. The Company is the owner of the Slinger Launcher, which
is a portable tennis ball launcher as well as other associated tennis accessories and Gameface AI an Australian artificial
intelligence sports software company. The
operations of Slinger Bag Inc., Slinger Bag Americas, Slinger Bag Canada, Slinger Bag UK, SBL, and Gameface AI are collectively
referred to as the “Company.” Basis
of Presentation The
accompanying condensed consolidated financial statements of the Company are presented in accordance with accounting principles generally
accepted in the United States of America (“GAAP”). As a result of the transactions described above, the accompanying consolidated
financial statements include the combined results of Slinger Bag Inc., Slinger Bag Americas, Slinger Bag Canada, Slinger Bag UK, SBL,
and Gameface for the periods ended July 31, 2024 and 2023. Impact
of COVID-19 Pandemic The
Company continues to carefully monitor the global COVID-19 pandemic status and its impact on its business. In that regard, while the
Company has continued to sell its products it has previously experienced certain minor disruptions in its supply chains. The Company
expects the significance of the COVID-19 pandemic, including the extent of its effect on the Company’s financial and operational
results, to be dictated by, among other things, the on-going global efforts to contain it. While the Company has not experienced any
material disruptions to its business and operations as a result of the COVID-19 pandemic, it is possible such disruptions may occur in
the future which may impact its financial and operational results, and which could be material. Impact
of Russian and Ukrainian Conflict In
February 2022, the Russian Federation and Belarus commenced a military action with the country of Ukraine. We are closely monitoring
the unfolding events due to the Russia-Ukraine conflict and its regional and global ramifications. We have one distributor in Russia,
which is not material to our overall financial results. We do not currently have operations in Ukraine or Belarus. We are monitoring
any broader economic impact from the current crisis. The specific impact on the Company’s financial condition, results of operations,
and cash flows is also not determinable as of the date of these financial statements. However, to the extent that such military action
spreads to other countries, intensifies, or otherwise remains active, such action could have a material adverse effect on our financial
condition, results of operations, and cash flows. Impact
of Israel and Hamas Conflict Because
we develop products in Israel and our chief marketing officer is located in Israel, our business and operations are directly affected
by economic, political, geopolitical and military conditions affecting Israel. Since the establishment of the State of Israel in 1948,
a number of armed conflicts have occurred between Israel and its neighboring countries and other hostile non-state actors. These conflicts
have involved missile strikes, hostile infiltrations and terrorism against civilian targets in various parts of Israel, which have negatively
affected business conditions in Israel. On
October 7, 2023, Hamas militants and members of other terrorist organizations infiltrated Israel’s southern border from the Gaza
Strip and conducted a series of terror attacks on civilian and military targets. Thereafter, these terrorists launched extensive rocket
attacks on the Israeli population and industrial centers located along the Israeli border with the Gaza Strip. As of October 7, 2023 ,
such attacks collectively resulted in over 1,478 deaths and over 5,400 injured people, in addition to the kidnapping of a currently indefinite
number of civilians, including women and children. Shortly following the attack, Israel’s security cabinet declared war against
Hamas. The
intensity and duration of Israel’s current war against Hamas is difficult to predict, and as are such war’s economic implications
on the Company’s business and operations and on Israel’s economy in general. On October 9, 2023, the Central Bank of Israel
announced its intent to sell up to $30 billion order to protect the New Israeli Shekel (“NIS”) from collapse, however despite
the foregoing announcement the NIS weakened to approximately 3.92 NIS for one US dollar as of the same day. In addition, on October 9,
2023, the Tel Aviv-35 stock index of blue-chip companies dropped by 6.4% whereas the benchmark TA-125 index fell by 6.2%. On July 31, 2024, Hamas leader, Ismail Haniyeh, was assassinated in Tehran, Iran, which, although not commented on
or confirmed by Israel, is largely believed to be attributable to Israel. On July 31, 2024, Israel killed Fouad Shukur, a Hezbollah commander
in Lebanon. These actions have caused both Iran and Hezbollah to threaten to retaliate against Israel (although to-date, no retaliatory
actions have been confirmed). It
is possible that other terrorist organizations will join the hostilities as well, including Palestinian military
organizations in the West Bank. In the event that hostilities disrupt the development of our products, our ability to deliver products
to customers in a timely manner to meet our contractual obligations with customers and vendors could be materially and adversely affected. Our
commercial insurance does not cover losses that may occur as a result of events associated with war and terrorism. Although the Israeli
government currently covers the reinstatement value of direct damages that are caused by terrorist attacks or acts of war, we cannot
assure you that this government coverage will be maintained or that it will sufficiently cover our potential damages. Any losses or damages
incurred by us could have a material adverse effect on our business. As
a result of the Israeli security cabinet’s decision to declare war against Hamas, several hundred thousand Israeli reservists
were drafted to perform immediate military service. If any of our employees and consultants in Israel are called for service in the
current war with Hamas, our operations may be disrupted by such absences, which may materially and adversely affect our business and
results of operations. Additionally, the absence of employees of our Israeli suppliers and contract manufacturers due to their
military service in the current war or future wars or other armed conflicts may disrupt their operations, in which event our ability
to deliver products to customers may be materially and adversely affected. Prior
to the Hamas attack in October 2023, the Israeli government pursued extensive changes to Israel’s judicial system, which sparked
extensive political debate and unrest. In response to such initiative, many individuals, organizations and institutions, both within
and outside of Israel, have voiced concerns that the proposed changes may negatively impact the business environment in Israel including
due to reluctance of foreign investors to invest or transact business in Israel as well as to increased currency fluctuations, downgrades
in credit rating, increased interest rates, increased volatility in security markets, and other changes in macroeconomic conditions.
The risk of such negative developments has increased in light of the recent Hamas attacks and the war against Hamas declared by Israel.
To the extent that any of these negative developments do occur, they may have an adverse effect on our business, our results of operations
and our ability to raise additional funds, if deemed necessary by our management and board of directors. |
