UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. __)*
| SIGNING DAY SPORTS, INC. |
| (Name of Issuer) |
| Common Stock, par value $0.0001 per share |
| (Title of Class of Securities) |
| 82670R 107 |
| (CUSIP Number) |
|
Daniel D. Nelson
c/o Signing Day Sports, Inc.
8355 East Hartford Rd.
Suite 100
Scottsdale, AZ 85255
(480) 220-6814 |
| (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) |
October 16, 2024
| (Date of Event which Requires Filing of This Statement) |
If the filing person has previously filed a statement
on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e),
240.13d-1(f) or 240.13d-1(g), check the following box. ☐
| * | The remainder of this cover page shall be filled out for a reporting
person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing
information which would alter disclosures provided in a prior cover page. |
The information required on the remainder of this
cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”)
or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
Page 2 of 8 pages
CUSIP No. 82670R 107
| 1. |
NAMES OF REPORTING PERSONS
Daniel D. Nelson |
|
| 2. |
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP |
(a) ☐
(b) ☐ |
| 3. |
SEC USE ONLY |
|
| 4. |
SOURCE OF FUNDS
OO |
|
| 5. |
CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
|
☐ |
| 6. |
CITIZENSHIP OR PLACE OF ORGANIZATION
United States |
|
| NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH: |
7. |
SOLE VOTING POWER |
0 |
| 8. |
SHARED VOTING POWER |
2,044,851(1) |
| 9. |
SOLE DISPOSITIVE POWER |
|
| 10. |
SHARED DISPOSITIVE POWER |
2,044,851(1) |
| 11. |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,044,851(1) |
|
| 12. |
CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
|
☐ |
| 13. |
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.3%(2) |
|
| 14. |
TYPE OF REPORTING PERSON
IN |
|
| (1) | Consists of (i) 1,200,000 shares of common stock, par value
$0.0001 per share (“common stock”), of Signing Day Sports, Inc., a Delaware corporation (the “Issuer”), held
by Daniel D. Nelson, (ii) 709,851 shares of common stock held by the Nelson Revocable Living Trust Agreement established on March 9,
1999 and amended and restated on November 21, 2005 (the “Nelson Trust”), (iii) 5,000 shares of common stock issuable upon
the exercise of an option held by Daniel D. Nelson, (iv) 30,000 shares of common stock issuable upon the exercise of an option held by
Daniel D. Nelson, and (v) 100,000 shares of common stock issuable upon the exercise of an option held by Daniel D. Nelson. Daniel D.
Nelson and Jodi B. Nelson are the co-trustees of the Nelson Trust, and each of Daniel D. Nelson and Jodi B. Nelson is deemed to beneficially
own the shares of common stock held by the Nelson Trust. Ms. Nelson, who is the spouse of Mr. Nelson, is deemed to beneficially own the
shares of common stock beneficially owned by Mr. Nelson. |
| (2) | The denominator of the fraction upon which this percentage
is calculated is based on 21,749,714 shares of common stock outstanding as of October 16, 2024. The numerator of the fraction upon which
the percentage is calculated is based on the number of shares of common stock that were beneficially owned by Daniel D. Nelson as of
October 16, 2024. |
Page 3 of 8 pages
CUSIP No. 82670R 107
| 1. |
NAMES OF REPORTING PERSONS
Jodi B. Nelson |
|
| 2. |
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP |
(a) ☐
(b) ☐ |
| 3. |
SEC USE ONLY |
|
| 4. |
SOURCE OF FUNDS
OO |
|
| 5. |
CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
|
☐ |
| 6. |
CITIZENSHIP OR PLACE OF ORGANIZATION
United States |
|
| NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH: |
7. |
SOLE VOTING POWER |
0 |
| 8. |
SHARED VOTING POWER |
2,044,851(1) |
| 9. |
SOLE DISPOSITIVE POWER |
|
| 10. |
SHARED DISPOSITIVE POWER |
2,044,851(1) |
| 11. |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,044,851(1) |
|
| 12. |
CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
|
☐ |
| 13. |
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.3%(2) |
|
| 14. |
TYPE OF REPORTING PERSON
IN |
|
| (1) | Consists of (i) 1,200,000 shares of common stock held by
Daniel D. Nelson, (ii) 709,851 shares of common stock held by the Nelson Trust, (iii) 5,000 shares of common stock issuable upon the
exercise of an option held by Daniel D. Nelson, (iv) 30,000 shares of common stock issuable upon the exercise of an option held by Daniel
D. Nelson, and (v) 100,000 shares of common stock issuable upon the exercise of an option held by Daniel D. Nelson. Daniel D. Nelson
and Jodi B. Nelson are the co-trustees of the Nelson Trust, and each of Daniel D. Nelson and Jodi B. Nelson is deemed to beneficially
own the shares of common stock held by the Nelson Trust. Ms. Nelson, who is the spouse of Mr. Nelson, is deemed to beneficially own the
shares of common stock beneficially owned by Mr. Nelson. |
| (2) | The denominator of the fraction upon which this percentage
is calculated is based on 21,749,714 shares of common stock outstanding as of October 16, 2024. The numerator of the fraction upon which
the percentage is calculated is based on the number of shares of common stock that were beneficially owned by Jodi B. Nelson as of October
16, 2024. |
Page 4 of 8 pages
CUSIP No. 82670R 107
Explanatory Note
The Reporting Persons (as defined below) previously
filed a Schedule 13G with the Securities and Exchange Commission (the “SEC”) on February 12, 2024, as amended by the Schedule
13G/A (Amendment No. 1) filed with the SEC on July 8, 2024, pursuant to Rule 13d-1(d) of the Act. On October 16, 2024, each of the Reporting
Persons acquired beneficial ownership of 1,000,000 shares of common stock, which constitutes an acquisition of more than 2% of the outstanding
shares of common stock. The Reporting Persons are filing this Schedule 13D (this “Schedule 13D”) in connection with this acquisition.
Unless otherwise noted, the share and per share
information in this Schedule 13D have been adjusted to give effect to the one-for-five (1-for-5) reverse stock split of the outstanding
common stock of the Issuer which became effective on April 14, 2023.
Item 1. Security and Issuer.
This Schedule 13D relates to common stock, par
value $0.0001 per share, of Signing Day Sports, Inc., a Delaware corporation. The Issuer has its principal executive offices at 8355 East
Hartford Rd., Suite 100, Scottsdale, AZ 85255.
Item 2. Identity and Background.
| (a) | This Schedule 13D is being jointly filed by Daniel D. Nelson,
an individual, and Jodi B. Nelson, an individual (collectively, the “Reporting Persons”), pursuant to a joint filing agreement,
dated October 21, 2024 (the “Joint Filing Agreement”), which is filed as Exhibit 1 to this Schedule 13D and is incorporated
by reference herein. |
| (b) | The business address of Daniel D. Nelson is c/o Signing Day
Sports, Inc., 8355 East Hartford Rd., Suite 100, Scottsdale, AZ 85255. The business address of Jodi B. Nelson is 9820 E Thompson Peak
Pkwy, Lot 623, Scottsdale, AZ 85255. |
| (c) | Daniel D. Nelson’s principal occupation or employment is Chief Executive Officer of the Issuer,
whose address is 8355 East Hartford Rd., Suite 100, Scottsdale, AZ 85255. Mr. Nelson also serves as Chairman and a director on the board
of directors of the Issuer. In addition, Mr. Nelson serves as chief executive officer of Daniel D. Nelson Financial Services Inc., whose
address is 8355 East Hartford Rd., Suite 102, Scottsdale, AZ 85255. Jodi B. Nelson’s principal occupation or employment is Art Studio
Owner and Instructor of Artistic Homeschooler, whose address is 9820 E. Thompson Peak Pkwy #623, Scottsdale, AZ 85255. |
| (d) | During the last five years, the Reporting Persons have not been convicted in any criminal proceeding (excluding
traffic violations or similar misdemeanors). |
| (e) | During the last five years, the Reporting Persons have not been a party to a civil proceeding of a judicial
or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation
with respect to such laws. |
| (f) | Each of the Reporting Persons is a citizen of the United States. |
Item 3. Source and Amount of Funds or Other
Consideration.
On October 16, 2024, Daniel D. Nelson was granted
1,000,000 shares of common stock (the “Acquisition Shares”) under the Signing Day Sports, Inc. Amended and Restated 2022 Equity
Incentive Plan (the “Plan”). The Acquisition Shares were granted pursuant to terms and conditions of the Issuer’s standard
form of restricted stock award agreement under the Plan in consideration for Mr. Nelson’s services provided while employed as the
Chief Executive Officer of the Issuer. Copies of the Plan and the restricted stock award agreement between the Issuer and Daniel
D. Nelson are filed as Exhibit 2 and Exhibit 3 to this Schedule 13D, respectively, and the description above is qualified in its entirety
by reference to the full text of such exhibits.
Page 5 of 8 pages
CUSIP No. 82670R 107
Prior acquisitions that were not previously reported
pursuant to Regulation 13D-G consist of the following:
On June 13, 2024, the Issuer granted an award
of 200,000 shares of restricted common stock under the Plan to Daniel D. Nelson. The restricted shares were granted subject to certain
vesting conditions and other terms and conditions of the Issuer’s standard form of restricted stock award agreement under the Plan.
A copy of the restricted stock award agreement is filed as Exhibit 4 to this Schedule 13D, and the description above is qualified
in its entirety by reference to the full text of such exhibit.
On November 22, 2023, the Issuer granted an option
under the Plan to purchase a total of 100,000 shares of common stock to Daniel D. Nelson pursuant to certain compensation terms of the
Executive Employment Agreement, dated as of November 22, 2023, between the Issuer and Daniel D. Nelson (the “Executive Employment
Agreement”). The option may be exercised at $3.10 per share. The option was granted subject to certain vesting conditions and other
terms and conditions of the Issuer’s standard form of stock option agreement under the Plan. The Executive Employment Agreement
was amended by the Amended and Restated Executive Employment Agreement, dated as of March 1, 2024 (the “Amended and Restated Executive
Agreement”), as amended by Amendment No. 1 to Executive Employment Agreement, dated as of July 9, 2024 (the “Amendment to
Executive Agreement”), between the Issuer and Mr. Nelson. Copies of the stock option agreement, the Executive Employment Agreement,
the Amended and Restated Executive Agreement, and the Amendment to Executive Agreement are filed as Exhibit 5, Exhibit 6, Exhibit 7, and
Exhibit 8 to this Schedule 13D, respectively, and the description above is qualified in its entirety by reference to the full text of
such exhibits.
On November 16, 2023, the Nelson Trust, whose
co-trustees are the Reporting Persons, purchased 20,000 shares of common stock for a purchase price of $100,000 in the Issuer’s
initial public offering, at the initial public offering price of $5.00 per share.
In connection with the Issuer’s initial
public offering, pursuant to the Underwriting Agreement,
dated as of November 13, 2023, by and between the Issuer and Boustead Securities, LLC (as representative of the underwriters named therein)
(“Boustead”), the executive officers, directors and stockholders holding 5% or more of the Issuer’s shares (as well
as holders of convertible or exercisable securities which convert into or are exercisable into common stock), including the Reporting
Persons, entered into lock-up agreements (the “Lock-Up Agreements”), pursuant to which they agreed, subject to certain exceptions,
to a 12-month “lock-up” period from the date on which the trading of the Issuer’s common stock commences, during which,
without the prior written consent of Boustead, they shall not, directly or indirectly, subject to certain exceptions, (i) offer, pledge,
sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant
to purchase or otherwise transfer or dispose of, any securities of the Issuer, owned either of record or beneficially by any signatory
of the respective Lock-Up Agreements on the date of the prospectus or thereafter acquired, or file, or cause to be filed, any registration
statement under the Securities Act of 1933, as amended, with respect to any of the foregoing; (ii) enter into any swap or other agreement
that transfers, in whole or in part, the economic consequence of ownership of the securities of the Company, whether any such swap or
transaction described in clause (i) or (ii) above is to be settled by delivery of securities of the Company or other securities, in cash
or otherwise. The form of the Lock-Up Agreements is filed as Exhibit 9 to this Schedule 13D, and the description above is qualified in
its entirety by reference to the full text of such exhibit.
On September 28, 2022, the Issuer granted an option
to purchase 30,000 shares of common stock and an option to purchase 5,000 shares of common stock under the Plan to Daniel D. Nelson. The
options may be exercised at $3.10 per share. The option to purchase 30,000 shares of common stock was granted subject to certain vesting
conditions, which have been met as of the date of this Schedule 13D, and other terms and conditions of the Issuer’s standard form
of stock option agreement under the Plan (the “Vested Option Agreement”). The option to purchase 5,000 shares of common stock
was granted as fully vested on the grant date, subject to other terms and conditions of the Issuer’s standard form of stock option
agreement under the Plan (the “Immediate Option Agreement”). Copies of the Vested Option Agreement and the Immediate Option
Agreement are filed as Exhibit 10 and Exhibit 11 to this Schedule 13D, respectively, and the description above is qualified in its entirety
by reference to the full text of such exhibits.
On September 22, 2022, a SAFE (Simple Agreement
For Future Equity), dated as of April 23, 2021 (the “SAFE”), between the Nelson Trust and Signing Day Sports, LLC, an Arizona
limited liability company (“SDS – AZ”), under which the Nelson Trust paid SDS – AZ $100,000 in exchange for certain
future equity rights in SDS – AZ, was cancelled and the number of shares of common stock equal to the purchase amount under the
SAFE divided by approximately $3.35, based on a $25 million valuation for the Company, or 29,851 shares, was issued to the Nelson Trust,
pursuant to a Cancellation and Exchange Agreement, dated as of September 22, 2022, between the Issuer and the Nelson Trust (the “Cancellation
Agreement”). Copies of the SAFE and the Cancellation Agreement are filed as Exhibit 12 and Exhibit 13 to this Schedule 13D,
respectively, and the description above is qualified in its entirety by reference to the full text of such exhibits.
Page 6 of 8 pages
CUSIP No. 82670R 107
On October 15, 2021, the Issuer issued a 6% convertible
unsecured promissory note (the “Convertible Note”) in a private placement in the amount of $1,500,000 to the Nelson Trust,
whose co-trustees are the Reporting Persons. The Convertible Note incurred interest at 6% annually and was to mature on October 15, 2024.
The Convertible Note contained provisions for optional and mandatory conversion and conversion price adjustments. On November 13, 2023,
the Issuer issued a settlement notice to the holders of the 6% convertible unsecured promissory notes undertaking to effect conversions
as if 110% of the principal being converted was being converted. The Nelson Trust also entered into a Subscription Agreement (“Subscription
Agreement”) and an Investor Rights and Lockup Agreement (“Investor Rights and Lockup Agreement”) which provided information
and inspection rights, registration rights, lock-up provisions, participation rights in subsequent securities offerings and private placements,
and typical “drag along” and “tag along” rights. On November 16, 2023, the closing of the Issuer’s initial
public offering and the listing of its common stock on the NYSE American LLC constituted a Liquidity Event (defined to include an initial
public offering and national stock exchange listing of the common stock of the Issuer) with respect to the Convertible Note. As a result,
on November 16, 2023, the principal of $1,500,000 outstanding under the Convertible Note automatically converted into a total of 660,000
shares of common stock, based on the conversion price of 50% of the initial public offering price of $5.00 per share, in accordance with
the settlement notice described above, and the interest under the Convertible Note was waived in accordance with its terms. Copies of
the Convertible Note, the Subscription Agreement, and the Investor Rights and Lockup Agreement are filed as Exhibit 14, Exhibit 15,
and Exhibit 16 to this Schedule 13D, respectively, and the description above is qualified in its entirety by reference to the full text
of such exhibits.
Jodi B. Nelson is the spouse of Daniel D. Nelson,
and is deemed to beneficially own the shares of common stock beneficially owned by Mr. Nelson and to have shared voting and dispositive
power over such shares.
Item 4. Purpose of Transaction.
The Reporting Persons’ acquisition of the
Acquisition Shares was for investment and compensation purposes. Daniel D. Nelson has been a director of the Issuer since July 8, 2022,
the Chief Executive Officer of the Issuer since November 21, 2022, and the Chairman of the Issuer since March 24, 2023. In these capacities,
Mr. Nelson may have influence over the corporate activities of the Issuer, including activities which may relate to items described in
subparagraphs (a) through (j) of Item 4 of Schedule 13D.
Except as disclosed in this Item, the Reporting
Persons do not have any current plans or proposals which relate to or would result in any of the events described in subparagraphs (a)
through (j) of Item 4 of Schedule 13D. The Reporting Persons, however, expect to evaluate on a continuing basis their goals and objectives,
other business opportunities available to them and may change their plans or proposals in the future. In determining from time to time
whether to sell the securities reported as beneficially owned in this Schedule 13D (and in what amounts) or to retain such securities,
the Reporting Persons will take into consideration such factors as they deem relevant, including the business and prospects of the Issuer,
anticipated future developments concerning the Issuer, existing and anticipated market conditions from time to time, general economic
conditions, regulatory matters, and other opportunities available to the Reporting Persons. In addition, the Reporting Persons may, from
time to time, transfer shares beneficially owned by them for tax, estate or other economic planning purposes. The Reporting Persons reserve
the right to acquire additional securities of the Issuer in the open market, in privately negotiated transactions (which may be with the
Issuer or with third parties) or otherwise, to dispose of all or a portion of their holdings of securities of the Issuer or to change
their intention with respect to any or all of the matters referred to in this Item 4.
Item 5. Interest in Securities of the Issuer.
| |
(a) | As of the date of this Schedule 13D, each of the Reporting
Persons is the beneficial owner of a total of 2,044,851 shares of common stock, representing 9.3% of the outstanding shares of common
stock of the Issuer. The shares of common stock beneficially owned consist of (i) 1,200,000 shares of common stock held by Daniel D.
Nelson, (ii) 709,851 shares of common stock held by the Nelson Trust, (iii) 5,000 shares of common stock issuable upon the exercise of
an option held by Daniel D. Nelson, (iv) 30,000 shares of common stock issuable upon the exercise of an option held by Daniel D. Nelson,
and (v) 100,000 shares of common stock issuable upon the exercise of an option held by Daniel D. Nelson. Daniel D. Nelson and Jodi B.
Nelson are the co-trustees of the Nelson Trust, and each of Daniel D. Nelson and Jodi B. Nelson is deemed to beneficially own the shares
of common stock held by the Nelson Trust. Ms. Nelson, who is the spouse of Mr. Nelson, is deemed to beneficially own the shares of common
stock beneficially owned by Mr. Nelson. |
Page 7 of 8 pages
CUSIP No. 82670R 107
| |
(b) | Each of the Reporting Persons has shared voting and dispositive
power over the shares of common stock that are beneficially owned by either of the Reporting Persons. |
| |
(c) | Except as described in this Schedule 13D, the Reporting Persons
have not effected any transactions in the common stock during the past 60 days. |
| |
(d) | No person other than the Reporting Persons are known to have
the right to receive, or the power to direct the receipt of dividends from, or the proceeds from the sale of, the shares of common stock
held by the Reporting Person. |
Item 6. Contracts, Arrangements, Understandings
or Relationships With Respect to Securities of the Issuer.
The information set forth in Item 3 and Item 4
hereof is incorporated by reference into this Item 6.
Other than as described above, there are no contracts,
arrangements, understandings, or relationships (legal or otherwise) among the persons named in Item 2 and between such persons and any
other persons with respect to any securities of the Issuer, including, but not limited to, call options, put options, security-based swaps
or any other derivative securities, transfer or voting of any of the securities, finder’s fees, joint ventures, loan or option arrangements,
guarantees of profits, division of profits or loss, or the giving or withholding of proxies.
Item 7. Material to be Filed as Exhibits.
| Exhibit |
|
Description |
| 1 |
|
Joint Filing Agreement, dated October 21, 2024, between Daniel D. Nelson and Jodi B. Nelson |
| 2 |
|
Signing Day Sports, Inc. Amended and Restated 2022 Equity Incentive Plan (incorporated by reference to Exhibit 99.1 to the Issuer’s Registration Statement on Form S-8 filed with the SEC on September 25, 2024) |
| 3 |
|
Restricted Stock Award Agreement, dated as of October 16, 2024, between Signing Day Sports, Inc. and Daniel D. Nelson |
| 4 |
|
Restricted Stock Award Agreement, dated as of June 13, 2024, between Signing Day Sports, Inc. and Daniel D. Nelson |
| 5 |
|
Stock Option Agreement, dated as of November 22, 2023, between Signing Day Sports, Inc. and Daniel D. Nelson |
| 6 |
|
Executive Employment Agreement, dated as of November 22, 2023, between Signing Day Sports, Inc. and Daniel D. Nelson (incorporated by reference to Exhibit 10.6 to the Issuer’s Current Report on Form 8-K filed on November 29, 2023) |
| 7 |
|
Amended and Restated Executive Employment Agreement, dated as of March 1, 2024, between Signing Day Sports, Inc. and Daniel D. Nelson (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on March 6, 2024) |
| 8 |
|
Amendment No. 1 to Executive Employment Agreement, dated as of July 9, 2024, between Signing Day Sports, Inc. and Daniel D. Nelson (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on July 10, 2024) |
| 9 |
|
Form of Lock-Up Agreement (incorporated by reference to Exhibit B to Exhibit 1.1 to the Current Report on Form 8-K filed on November 17, 2023) |
| 10 |
|
Stock Option Agreement, dated as of September 28, 2022, between Signing Day Sports, Inc. and Daniel D. Nelson |
| 11 |
|
Stock Option Agreement, dated as of September 28, 2022, between Signing Day Sports, Inc. and Daniel D. Nelson |
| 12 |
|
SAFE (Simple Agreement For Future Equity), dated as of April 23, 2021, between Signing Day Sports, LLC and Daniel D. Nelson |
| 13 |
|
Cancellation and Exchange Agreement, dated as of September 22, 2022, between the Issuer and Nelson Revocable Living Trust |
| 14 |
|
Convertible Note, dated October 15, 2021, of Signing Day Sports, Inc., issued to Nelson Revocable Living Trust |
| 15 |
|
Subscription Agreement, dated as of October 15, 2021, between Signing Day Sports, Inc. and Nelson Revocable Living Trust |
| 16 |
|
Investor Rights and Lock-Up Agreement, dated as of October 15, 2021, between Signing Day Sports, Inc. and Nelson Revocable Living Trust |
Page 8 of 8 pages
CUSIP No. 82670R 107
SIGNATURES
After reasonable inquiry and
to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.
Dated: October 21, 2024
| |
/s/ Daniel D. Nelson |
| |
Daniel D. Nelson |
| |
|
| |
/s/ Jodi B. Nelson |
| |
Jodi B. Nelson |
Exhibit 1
JOINT FILING AGREEMENT
In accordance with Rule 13d-1(k)
under the Securities Exchange Act of 1934, as amended, each of the undersigned hereby agrees to the joint filing on behalf of each of
them of a statement on Schedule 13D (including amendments thereto) with respect to the common stock, par value $0.0001 per share, of Signing
Day Sports, Inc., a Delaware corporation, and that this Agreement be included as an Exhibit to such joint filing.
Each of the undersigned acknowledges
that each shall be responsible for the timely filing of any statement (including amendments) on Schedule 13D, and for the completeness
and accuracy of the information concerning him, her, or it contained therein, but shall not be responsible for the completeness and accuracy
of the information concerning the other persons making such filings, except to the extent that he, she, or it knows or has reason to believe
that such information is inaccurate.
| |
Dated: October 21, 2024 |
| |
|
| |
/s/ Daniel D. Nelson |
| |
Daniel D. Nelson |
| |
|
| |
/s/ Jodi B. Nelson |
| |
Jodi B. Nelson |
Exhibit 3
RESTRICTED STOCK AWARD AGREEMENT
This Restricted Stock Award
Agreement (this “Agreement”) is made and entered into as of October 16, 2024 (the “Grant Date”)
by and between Signing Day Sports, Inc., a Delaware corporation (the “Company”), and Daniel Nelson (the “Grantee”).
WHEREAS, the Company
has adopted the Signing Day Sports, Inc. Amended and Restated 2022 Equity Incentive Plan (the “Plan”) pursuant to which
awards of Restricted Stock may be granted; and
WHEREAS, the Committee
has determined that it is in the best interests of the Company and its stockholders to grant the award of Restricted Stock provided for
herein.
NOW, THEREFORE, the
parties hereto, intending to be legally bound, agree as follows:
1. Grant
of Restricted Stock. Pursuant to Section 7.2 of the Plan, the Company hereby issues to the Grantee on the Grant Date a Restricted
Stock Award consisting of, in the aggregate, 1,000,000 shares of Common Stock of the Company (the “Restricted Stock”),
on the terms and conditions and subject to the restrictions set forth in this Agreement and the Plan. Capitalized terms that are used
but not defined herein have the meaning ascribed to them in the Plan.
2. Consideration.
The grant of the Restricted Stock is made in consideration of the services to be rendered by the Grantee to the Company.
3. Restricted
Period; Vesting.
3.1. Except
as otherwise provided herein, provided that the Grantee remains in Continuous Service through the applicable vesting date, and further
provided that any additional conditions and performance goals set forth in Schedule I have been satisfied, the Restricted Stock will vest
in accordance with the following schedule:
| Vesting Date | |
Shares of Common Stock | |
| October 16, 2024 | |
| 1,000,000 | |
The period over which the
Restricted Stock vests is referred to as the “Restricted Period”.
3.2. The
foregoing vesting schedule notwithstanding, if the Grantee’s Continuous Service terminates for any reason at any time before all
of his or her Restricted Stock has vested other than death or retirement (in the case of a Director), termination of the Grantee’s
Continuous Service is terminated by the Company or an Affiliate for Disability, the Grantee’s unvested Restricted Stock shall be
automatically forfeited upon such termination of Continuous Service and neither the Company nor any Affiliate shall have any further obligations
to the Grantee under this Agreement.
3.3. The
foregoing vesting schedule notwithstanding, in the event of the Grantee’s death or if the Grantee’s Continuous Service is
terminated by the Company or an Affiliate for Disability, 100% of the unvested Restricted Stock shall vest as of the date of such termination.
4. Restrictions.
Subject to any exceptions set forth in this Agreement or the Plan, during the Restricted Period, the Restricted Stock or the rights relating
thereto may not be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by the Grantee. Any attempt to
assign, alienate, pledge, attach, sell or otherwise transfer or encumber the Restricted Stock or the rights relating thereto during the
Restricted Period shall be wholly ineffective and, if any such attempt is made, the Restricted Stock will be forfeited by the Grantee
and all of the Grantee’s rights to such shares shall immediately terminate without any payment or consideration by the Company.
5. Rights
as Stockholder; Dividends.
5.1. The
Grantee shall be the record owner of the Restricted Stock until the shares of Common Stock are sold or otherwise disposed of, and shall
be entitled to all of the rights of a stockholder of the Company including, without limitation, the right to vote such shares and receive
all dividends or other distributions paid with respect to such shares. Notwithstanding the foregoing, any dividends or other distributions
shall be subject to the same restrictions on transferability as the shares of Restricted Stock with respect to which they were paid.
5.2. The
Company may issue stock certificates or evidence the Grantee’s interest by using a restricted book entry account with the Company’s
transfer agent. Physical possession or custody of any stock certificates that are issued may be retained by the Company until such time
as the Restricted Stock vests.
5.3. If
the Grantee forfeits any rights he or she has under this Agreement in accordance with Section 3, the Grantee shall, on the date of such
forfeiture, no longer have any rights as a stockholder with respect to the Restricted Stock and shall no longer be entitled to vote or
receive dividends on such shares.
6. No
Right to Continued Service. Neither the Plan nor this Agreement shall confer upon the Grantee any right to be retained in any position,
as an Employee, Consultant or Director of the Company. Further, nothing in the Plan or this Agreement shall be construed to limit the
discretion of the Company to terminate the Grantee’s Continuous Service at any time, with or without Cause.
7. Adjustments.
If any change is made to the outstanding Common Stock or the capital structure of the Company, if required, the shares of Common Stock
shall be adjusted or terminated in any manner as contemplated by Section 11 of the Plan.
8. Tax
Liability and Withholding.
8.1. The
Grantee shall be required to pay to the Company, and the Company shall have the right to deduct from any compensation paid to the Grantee
pursuant to the Plan, the amount of any required withholding taxes in respect of the Restricted Stock and to take all such other action
as the Committee deems necessary to satisfy all obligations for the payment of such withholding taxes. The Committee may permit the Grantee
to satisfy any federal, state or local tax withholding obligation by any of the following means, or by a combination of such means: (a)
tendering a cash payment; (b) authorizing the Company to withhold shares of Common Stock from the shares of Common Stock otherwise issuable
or deliverable to the Grantee as a result of the vesting of the Restricted Stock; provided, however, that no shares of Common Stock
shall be withheld with a value exceeding the minimum amount of tax required to be withheld by law; or (c) delivering to the Company previously
owned and unencumbered shares of Common Stock.
8.2. Notwithstanding
any action the Company takes with respect to any or all income tax, social insurance, payroll tax, or other tax-related withholding (“Tax-Related
Items”), the ultimate liability for all Tax-Related Items is and remains the Grantee’s responsibility and the Company
(a) makes no representation or undertakings regarding the treatment of any Tax-Related Items in connection with the grant or vesting of
the Restricted Stock or the subsequent sale of any shares; and (b) does not commit to structure the Restricted Stock to reduce or eliminate
the Grantee’s liability for Tax-Related Items.
9. Section
83(b) Election. The Grantee may make an election under Code Section 83(b) (a “Section 83(b) Election”) with respect
to the Restricted Stock. Any such election must be made within thirty (30) days after the Grant Date. If the Grantee elects to make a
Section 83(b) Election, the Grantee shall provide the Company with a copy of an executed version and satisfactory evidence of the filing
of the executed Section 83(b) Election with the US Internal Revenue Service. The Grantee agrees to assume full responsibility for ensuring
that the Section 83(b) Election is actually and timely filed with the US Internal Revenue Service and for all tax consequences resulting
from the Section 83(b) Election.
10. Compliance
with Law. The issuance and transfer of shares of Common Stock shall be subject to compliance by the Company and the Grantee with all
applicable requirements of federal and state securities laws and with all applicable requirements of any stock exchange on which the Company’s
shares of Common Stock may be listed. No shares of Common Stock shall be issued or transferred unless and until any then applicable requirements
of state and federal laws and regulatory agencies have been fully complied with to the satisfaction of the Company and its counsel. The
Grantee understands that the Company is under no obligation to register the shares of Common Stock with the Securities and Exchange Commission,
any state securities commission or any stock exchange to effect such compliance.
11. Legends.
A legend may be placed on any certificate(s) or other document(s) delivered to the Grantee indicating restrictions on transferability
of the shares of Restricted Stock pursuant to this Agreement or any other restrictions that the Committee may deem advisable under the
rules, regulations and other requirements of the Securities and Exchange Commission, any applicable federal or state securities laws or
any stock exchange on which the shares of Common Stock are then listed or quoted.
12. Notices.
Any notice required to be delivered to the Company under this Agreement shall be in writing and addressed to the Secretary of the Company
at the Company’s principal corporate offices. Any notice required to be delivered to the Grantee under this Agreement shall be in
writing and addressed to the Grantee at the Grantee’s address as shown in the records of the Company. Either party may designate
another address in writing (or by such other method approved by the Company) from time to time.
13. Governing
Law. This Agreement will be construed and interpreted in accordance with the laws of the State of Delaware without regard to conflict
of law principles.
14. Interpretation.
Any dispute regarding the interpretation of this Agreement shall be submitted by the Grantee or the Company to the Committee for review.
The resolution of such dispute by the Committee shall be final and binding on the Grantee and the Company.
15. Restricted
Stock Subject to Plan. This Agreement is subject to the Plan as approved by the Company’s stockholders. The terms and provisions
of the Plan as it may be amended from time to time are hereby incorporated herein by reference. In the event of a conflict between any
term or provision contained herein and a term or provision of the Plan, the applicable terms and provisions of the Plan will govern and
prevail.
16. Successors
and Assigns. The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit
of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding
upon the Grantee and the Grantee’s beneficiaries, executors, administrators and the person(s) to whom the Restricted Stock may be
transferred by will or the laws of descent or distribution.
17. Severability.
The invalidity or unenforceability of any provision of the Plan or this Agreement shall not affect the validity or enforceability of any
other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement shall be severable and enforceable to
the extent permitted by law.
18. Discretionary
Nature of Plan. The Plan is discretionary and may be amended, cancelled or terminated by the Company at any time, in its discretion.
The grant of the Restricted Stock in this Agreement does not create any contractual right or other right to receive any Restricted Stock
or other Awards in the future. Future Awards, if any, will be at the sole discretion of the Company. Any amendment, modification, or termination
of the Plan shall not constitute a change or impairment of the terms and conditions of the Grantee’s employment with the Company.
19. Amendment.
The Committee has the right to amend, alter, suspend, discontinue or cancel the Restricted Stock, prospectively or retroactively; provided,
that, no such amendment shall adversely affect the Grantee’s material rights under this Agreement without the Grantee’s
consent.
20. No
Impact on Other Benefits. The value of the Grantee’s Restricted Stock is not part of his normal or expected compensation for
purposes of calculating any severance, retirement, welfare, insurance or similar employee benefit.
21. Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together will constitute one
and the same instrument. Counterpart signature pages to this Agreement transmitted by facsimile transmission, by electronic mail in portable
document format (.pdf), or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document,
will have the same effect as physical delivery of the paper document bearing an original signature.
22. Acceptance.
The Grantee hereby acknowledges receipt of a copy of the Plan and this Agreement. The Grantee has read and understands the terms and provisions
thereof, and accepts the Restricted Stock subject to all of the terms and conditions of the Plan and this Agreement. The Grantee acknowledges
that there may be adverse tax consequences upon the grant or vesting of the Restricted Stock or disposition of the shares and that the
Grantee has been advised to consult a tax advisor prior to such grant, vesting or disposition.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF,
the parties hereto have executed this Agreement as of the date first above written.
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COMPANY: |
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Signing Day Sports, Inc. |
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By: |
/s/ Damon Rich |
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Name: |
Damon Rich |
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Title: |
Interim Chief Financial Officer |
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Address: |
8355 East Hartford Rd., Suite 100 |
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Scottsdale, AZ 85260 |
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Maricopa County, USA |
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GRANTEE: |
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/s/ Daniel Nelson |
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(Signature) |
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Daniel Nelson |
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(Name) |
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Address: |
[Redacted] |
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|
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|
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SSN: |
[Redacted] |
Exhibit 4
RESTRICTED STOCK AWARD AGREEMENT
This Restricted
Stock Award Agreement (this “Agreement”) is made and entered into as of June 13, 2024 (the “Grant Date”)
by and between Signing Day Sports, Inc., a Delaware corporation (the “Company”), and Daniel D. Nelson (the “Grantee”).
WHEREAS,
the Company has adopted the Signing Day Sports, Inc. 2022 Equity Incentive Plan, as amended by Amendment No. 1 to the Signing Day Sports,
Inc. 2022 Equity Incentive Plan (the “Plan”) pursuant to which awards of Restricted Stock may be granted; and
WHEREAS, the Committee
has determined that it is in the best interests of the Company and its stockholders to grant the award of Restricted Stock provided for
herein.
NOW, THEREFORE, the
parties hereto, intending to be legally bound, agree as follows:
1. Grant of Restricted
Stock. Pursuant to Section 7.2 of the Plan, the Company hereby issues to the Grantee on the Grant Date a Restricted Stock Award consisting
of, in the aggregate, 200,000 shares of Common Stock of the Company (the “Restricted Stock”), on the terms and conditions
and subject to the restrictions set forth in this Agreement and the Plan. Capitalized terms that are used but not defined herein have
the meaning ascribed to them in the Plan.
2. Consideration.
The grant of the Restricted Stock is made in consideration of the services to be rendered by the Grantee to the Company.
3. Restricted
Period; Vesting.
3.1. Except as otherwise provided
herein, provided that the Grantee remains in Continuous Service through the applicable vesting date, the Restricted Stock will vest in
accordance with the following schedule:
| Vesting Date | |
Shares of
Common
Stock | |
| September 13, 2024 | |
| 50,000 | |
| December 13, 2024 | |
| 50,000 | |
| March 13, 2025 | |
| 50,000 | |
| June 13, 2025 | |
| 50,000 | |
The period over which the
Restricted Stock vests is referred to as the “Restricted Period”.
3.2. The
foregoing vesting schedule notwithstanding, if the Grantee’s Continuous Service terminates for any reason at any time before all
of his or her Restricted Stock has vested other than death or retirement (in the case of a Director), termination of the Grantee’s
Continuous Service is terminated by the Company or an Affiliate for Disability, the Grantee’s unvested Restricted Stock shall be
automatically forfeited upon such termination of Continuous Service and neither the Company nor any Affiliate shall have any further obligations
to the Grantee under this Agreement.
3.3. The
foregoing vesting schedule notwithstanding, in the event of the Grantee’s death or if the Grantee’s Continuous Service is
terminated by the Company or an Affiliate for Disability, 100% of the unvested Restricted Stock shall vest as of the date of such termination.
4. Restrictions.
Subject to any exceptions set forth in this Agreement or the Plan, during the Restricted Period, the Restricted Stock or the rights relating
thereto may not be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by the Grantee. Any attempt to
assign, alienate, pledge, attach, sell or otherwise transfer or encumber the Restricted Stock or the rights relating thereto during the
Restricted Period shall be wholly ineffective and, if any such attempt is made, the Restricted Stock will be forfeited by the Grantee
and all of the Grantee’s rights to such shares shall immediately terminate without any payment or consideration by the Company.
5. Rights
as Stockholder; Dividends.
5.1. The
Grantee shall be the record owner of the Restricted Stock until the shares of Common Stock are sold or otherwise disposed of, and shall
be entitled to all of the rights of a stockholder of the Company including, without limitation, the right to vote such shares and receive
all dividends or other distributions paid with respect to such shares. Notwithstanding the foregoing, any dividends or other distributions
shall be subject to the same restrictions on transferability as the shares of Restricted Stock with respect to which they were paid.
5.2. The
Company may issue stock certificates or evidence the Grantee’s interest by using a restricted book entry account with the Company’s
transfer agent. Physical possession or custody of any stock certificates that are issued may be retained by the Company until such time
as the Restricted Stock vests.
5.3. If
the Grantee forfeits any rights he or she has under this Agreement in accordance with Section 3, the Grantee shall, on the date of such
forfeiture, no longer have any rights as a stockholder with respect to the Restricted Stock and shall no longer be entitled to vote or
receive dividends on such shares.
6. No
Right to Continued Service. Neither the Plan nor this Agreement shall confer upon the Grantee any right to be retained in any position,
as an Employee, Consultant or Director of the Company. Further, nothing in the Plan or this Agreement shall be construed to limit the
discretion of the Company to terminate the Grantee’s Continuous Service at any time, with or without Cause.
7. Adjustments.
If any change is made to the outstanding Common Stock or the capital structure of the Company, if required, the shares of Common Stock
shall be adjusted or terminated in any manner as contemplated by Section 11 of the Plan.
8. Tax
Liability and Withholding.
8.1. The
Grantee shall be required to pay to the Company, and the Company shall have the right to deduct from any compensation paid to the Grantee
pursuant to the Plan, the amount of any required withholding taxes in respect of the Restricted Stock and to take all such other action
as the Committee deems necessary to satisfy all obligations for the payment of such withholding taxes. The Committee may permit the Grantee
to satisfy any federal, state or local tax withholding obligation by any of the following means, or by a combination of such means: (a)
tendering a cash payment; (b) authorizing the Company to withhold shares of Common Stock from the shares of Common Stock otherwise issuable
or deliverable to the Grantee as a result of the vesting of the Restricted Stock; provided, however, that no shares of Common Stock
shall be withheld with a value exceeding the minimum amount of tax required to be withheld by law; or (c) delivering to the Company previously
owned and unencumbered shares of Common Stock.
8.2. Notwithstanding
any action the Company takes with respect to any or all income tax, social insurance, payroll tax, or other tax-related withholding (“Tax-Related
Items”), the ultimate liability for all Tax-Related Items is and remains the Grantee’s responsibility and the Company
(a) makes no representation or undertakings regarding the treatment of any Tax-Related Items in connection with the grant or vesting of
the Restricted Stock or the subsequent sale of any shares; and (b) does not commit to structure the Restricted Stock to reduce or eliminate
the Grantee’s liability for Tax-Related Items.
9. Section
83(b) Election. The Grantee may make an election under Code Section 83(b) (a “Section 83(b) Election”) with respect
to the Restricted Stock. Any such election must be made within thirty (30) days after the Grant Date. If the Grantee elects to make a
Section 83(b) Election, the Grantee shall provide the Company with a copy of an executed version and satisfactory evidence of the filing
of the executed Section 83(b) Election with the US Internal Revenue Service. The Grantee agrees to assume full responsibility for ensuring
that the Section 83(b) Election is actually and timely filed with the US Internal Revenue Service and for all tax consequences resulting
from the Section 83(b) Election.
10. Compliance
with Law. The issuance and transfer of shares of Common Stock shall be subject to compliance by the Company and the Grantee with all
applicable requirements of federal and state securities laws and with all applicable requirements of any stock exchange on which the Company’s
shares of Common Stock may be listed. No shares of Common Stock shall be issued or transferred unless and until any then applicable requirements
of state and federal laws and regulatory agencies have been fully complied with to the satisfaction of the Company and its counsel. The
Grantee understands that the Company is under no obligation to register the shares of Common Stock with the Securities and Exchange Commission,
any state securities commission or any stock exchange to effect such compliance.
11. Legends.
A legend may be placed on any certificate(s) or other document(s) delivered to the Grantee indicating restrictions on transferability
of the shares of Restricted Stock pursuant to this Agreement or any other restrictions that the Committee may deem advisable under the
rules, regulations and other requirements of the Securities and Exchange Commission, any applicable federal or state securities laws or
any stock exchange on which the shares of Common Stock are then listed or quoted.
12. Notices.
Any notice required to be delivered to the Company under this Agreement shall be in writing and addressed to the Secretary of the Company
at the Company’s principal corporate offices. Any notice required to be delivered to the Grantee under this Agreement shall be in
writing and addressed to the Grantee at the Grantee’s address as shown in the records of the Company. Either party may designate
another address in writing (or by such other method approved by the Company) from time to time.
13. Governing
Law. This Agreement will be construed and interpreted in accordance with the laws of the State of Delaware without regard to conflict
of law principles.
14. Interpretation.
Any dispute regarding the interpretation of this Agreement shall be submitted by the Grantee or the Company to the Committee for review.
The resolution of such dispute by the Committee shall be final and binding on the Grantee and the Company.
15. Restricted
Stock Subject to Plan. This Agreement is subject to the Plan as approved by the Company’s stockholders. The terms and provisions
of the Plan as it may be amended from time to time are hereby incorporated herein by reference. In the event of a conflict between any
term or provision contained herein and a term or provision of the Plan, the applicable terms and provisions of the Plan will govern and
prevail.
16. Successors
and Assigns. The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit
of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding
upon the Grantee and the Grantee’s beneficiaries, executors, administrators and the person(s) to whom the Restricted Stock may be
transferred by will or the laws of descent or distribution.
17. Severability.
The invalidity or unenforceability of any provision of the Plan or this Agreement shall not affect the validity or enforceability of any
other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement shall be severable and enforceable to
the extent permitted by law.
18. Discretionary
Nature of Plan. The Plan is discretionary and may be amended, cancelled or terminated by the Company at any time, in its discretion.
The grant of the Restricted Stock in this Agreement does not create any contractual right or other right to receive any Restricted Stock
or other Awards in the future. Future Awards, if any, will be at the sole discretion of the Company. Any amendment, modification, or termination
of the Plan shall not constitute a change or impairment of the terms and conditions of the Grantee’s employment with the Company.
19. Amendment.
The Committee has the right to amend, alter, suspend, discontinue or cancel the Restricted Stock, prospectively or retroactively; provided,
that, no such amendment shall adversely affect the Grantee’s material rights under this Agreement without the Grantee’s
consent.
20. No
Impact on Other Benefits. The value of the Grantee’s Restricted Stock is not part of his normal or expected compensation for
purposes of calculating any severance, retirement, welfare, insurance or similar employee benefit.
21. Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together will constitute one
and the same instrument. Counterpart signature pages to this Agreement transmitted by facsimile transmission, by electronic mail in portable
document format (.pdf), or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document,
will have the same effect as physical delivery of the paper document bearing an original signature.
22. Acceptance.
The Grantee hereby acknowledges receipt of a copy of the Plan and this Agreement. The Grantee has read and understands the terms and provisions
thereof, and accepts the Restricted Stock subject to all of the terms and conditions of the Plan and this Agreement. The Grantee acknowledges
that there may be adverse tax consequences upon the grant or vesting of the Restricted Stock or disposition of the shares and that the
Grantee has been advised to consult a tax advisor prior to such grant, vesting or disposition.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF,
the parties hereto have executed this Agreement as of the date first above written.
| |
COMPANY: |
| |
|
|
| |
Signing Day Sports, Inc. |
| |
|
|
| |
By: |
/s/ Damon Rich |
| |
|
Name: |
Damon Rich |
| |
|
Title: |
Interim Chief Financial Officer |
| |
Address: |
8355 East Hartford Rd., Suite 100 |
| |
|
Scottsdale, AZ 85260 |
| |
|
Maricopa County, Arizona |
| |
GRANTEE: |
| |
|
| |
/s/ Daniel D. Nelson |
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(Signature) |
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|
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Daniel D. Nelson |
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(Name) |
| |
Address: |
[Redacted] |
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|
|
| |
|
|
| |
|
|
| |
SSN: |
[Redacted] |
Exhibit 5
STOCK OPTION AGREEMENT
This Stock
Option Agreement (this “Agreement”) is made and entered into as of the Grant Date specified below by and between Signing
Day Sports, Inc., a Delaware corporation (the “Company”), and the participant named below (the “Participant”).
| Name
of Participant: | |
Daniel
D. Nelson |
| Grant
Date: | |
November
22, 2023 |
| Expiration
Date: | |
November 21,
2033 |
| Exercise
Price: | |
$2.25 |
| Number of
Option Shares: | |
100,000 |
| Type of Option: | |
Incentive
Stock Option |
| Vesting
Start Date: | |
November 22,
2023 |
| Vesting
Schedule: | |
1/2
of the Option (as defined below) shall vest and become exercisable immediately on the Grant Date and the remaining1/2 of the Option
shall vest and become exercisable in six (6) equal monthly installments following the Grant Date, subject to the Participant’s
Continuous Service (as defined in the Plan (as defined below)). |
1. Grant of Option.
1.1. Grant.
The Company hereby grants to the Participant an option (the “Option”) to purchase the total number of shares of Common
Stock of the Company equal to the number of Option Shares set forth above, at the Exercise Price set forth above. The Option is being
granted pursuant to the terms of the Company’s 2022 Equity Incentive Plan (the “Plan”). Capitalized terms used
but not defined herein will have the meanings ascribed to them in the Plan.
1.2. Type
of Option. The Option is intended to be either a Non-qualified Stock Option (i.e., not an Incentive Stock Option) or an Incentive
Stock Option within the meaning of Section 422 of the Code, as indicated above, although the Company makes no representation or guarantee
that the Option will qualify as an Incentive Stock Option. To the extent that the aggregate Fair Market Value (determined on the Grant
Date) of the shares of Common Stock with respect to which Incentive Stock Options are exercisable for the first time by the Participant
during any calendar year (under all plans of the Company and its Affiliates) exceeds $100,000, the Option or portion thereof which exceeds
such limit (according to the order in which they were granted) shall be treated as a Non-qualified Stock Option.
1.3. Consideration.
The grant of the Option is made in consideration of the services to be rendered by the Participant to the Company and is subject to the
terms and conditions of the Plan.
2. Exercise Period; Vesting.
2.1. Vesting
Schedule. The Option will become vested and exercisable in accordance with the Vesting Schedule specified above until the Option is
100% vested. The unvested portion of the Option will not be exercisable on or after the Participant’s termination of Continuous
Service.
2.2. Expiration.
The Option will expire on the Expiration Date set forth above, or earlier as provided in this Agreement or the Plan.
3. Termination of Continuous Service.
3.1. Termination for
Reasons Other Than Cause, Death or Disability. If the Participant’s Continuous Service is terminated for any reason other
than Cause, death or Disability, the Participant may exercise the vested portion of the Option, but only within such period of time
ending on the earlier of (a) the date that is three months following the termination of the Participant’s Continuous Service
or (b) the Expiration Date.
3.2. Termination
for Cause. If the Participant’s Continuous Service is terminated for Cause, the Option (whether vested or unvested) shall immediately
terminate and cease to be exercisable.
3.3. Termination
Due to Disability. If the Participant’s Continuous Service terminates as a result of the Participant’s Disability, the
Participant may exercise the vested portion of the Option, but only within such period of time ending on the earlier of (a) the date that
is 12 months following the Participant’s termination of Continuous Service or (b) the Expiration Date.
3.4. Termination
Due to Death. If the Participant’s Continuous Service terminates as a result of the Participant’s death, or the Participant
dies within a period following termination of the Participant’s Continuous Service during which the vested portion of the Option
remains exercisable, the vested portion of the Option may be exercised by the Participant’s estate, by a person who acquired the
right to exercise the Option by bequest or inheritance or by the person designated to exercise the Option upon the Participant’s
death, but only within the time period ending on the earlier of (a) the date that is 12 months following the Participant’s death
or (b) the Expiration Date.
3.5. Extension
of Termination Date. If following the Participant’s termination of Continuous Service for any reason the exercise of the Option
is prohibited because the exercise of the Option would violate the registration requirements under the Securities Act or any other state
or federal securities law or the rules of any securities exchange or interdealer quotation system, then the expiration of the Option shall
be tolled until the date that is thirty (30) days after the end of the period during which the exercise of the Option would be in violation
of such registration or other securities requirements.
4. Manner of Exercise.
4.1. Election
to Exercise. To exercise the Option, the Participant (or in the case of exercise after the Participant’s death or incapacity,
the Participant’s executor, administrator, heir or legatee, as the case may be) must deliver to the Company an executed stock option
exercise agreement in the form attached hereto as Exhibit A, or as is approved by the Committee from time to time (the “Exercise
Agreement”), which shall set forth, inter alia: (a) the Participant’s election to exercise the Option; (b) the
number of shares of Common Stock being purchased; (c) any restrictions imposed on the shares; and (d) any representations, warranties
and agreements regarding the Participant’s investment intent and access to information as may be required by the Company to comply
with applicable securities laws. If someone other than the Participant exercises the Option, then such person must submit documentation
reasonably acceptable to the Company verifying that such person has the legal right to exercise the Option.
4.2. Payment of
Exercise Price. The entire Exercise Price of the Option shall be payable in full at the time of exercise to the extent permitted
by applicable statutes and regulations, either: (a) in cash or by certified or bank check at the time the Option is exercised; (b)
by delivery to the Company of other shares of Common Stock, duly endorsed for transfer to the Company, with a Fair Market Value on
the date of delivery equal to the Exercise Price (or portion thereof) due for the number of shares being acquired, or by means of
attestation whereby the Participant identifies for delivery specific shares that have a Fair Market Value on the date of attestation
equal to the Exercise Price (or portion thereof) and receives a number of shares equal to the difference between the number of
shares thereby purchased and the number of identified attestation shares (a “Stock for Stock Exchange”); (c)
through a “cashless exercise program” established with a broker; (d) by reduction in the number of shares otherwise
deliverable upon exercise of such Option with a Fair Market Value equal to the aggregate Exercise Price at the time of exercise; (e)
by any combination of the foregoing methods; or (f) in any other form of legal consideration that may be acceptable to the
Committee.
4.3. Withholding.
Prior to the issuance of shares upon the exercise of the Option, the Participant must make arrangements satisfactory to the Company to
pay or provide for any applicable federal, state and local withholding obligations of the Company. The Participant may satisfy any federal,
state or local tax withholding obligation relating to the exercise of the Option by any of the following means: (a) tendering a cash payment;
(b) authorizing the Company to withhold shares of Common Stock from the shares of Common Stock otherwise issuable to the Participant as
a result of the exercise of the Option; provided, however, that no shares of Common Stock are withheld with a value exceeding the
minimum amount of tax required to be withheld by law; or (c) delivering to the Company previously owned and unencumbered shares of Common
Stock. The Company has the right to withhold from any compensation paid to a Participant.
4.4. Issuance
of Shares. Provided that the Exercise Agreement and payment are in form and substance satisfactory to the Company, the Company shall
issue the shares of Common Stock registered in the name of the Participant, the Participant’s authorized assignee, or the Participant’s
legal representative which shall be evidenced by stock certificates representing the shares with the appropriate legends affixed thereto,
appropriate entry on the books of the Company or of a duly authorized transfer agent, or other appropriate means as determined by the
Company.
5. No
Right to Continued Service; No Rights as Stockholder. Neither the Plan nor this Agreement shall confer upon the Participant any right
to be retained in any position, as an Employee, Consultant or Director of the Company. Further, nothing in the Plan or this Agreement
shall be construed to limit the discretion of the Company to terminate the Participant’s Continuous Service at any time, with or
without Cause. The Participant shall not have any rights as a stockholder with respect to any shares of Common Stock subject to the Option
prior to the date of exercise of the Option.
6. Transferability.
The Option is not transferable by the Participant other than to a designated beneficiary upon the Participant’s death or by will
or the laws of descent and distribution, and is exercisable during the Participant’s lifetime only by him or her. No assignment
or transfer of the Option, or the rights represented thereby, whether voluntary or involuntary, by operation of law or otherwise (except
to a designated beneficiary upon death by will or the laws of descent or distribution) will vest in the assignee or transferee any interest
or right herein whatsoever, but immediately upon such assignment or transfer the Option will terminate and become of no further effect.
7. Change
in Control. In the event of a Change in Control, the Committee may, in its discretion and upon at least ten (10) days’ advance
notice to the Participant, cancel the Option and pay to the Participant the value of the Option based upon the price per share of Common
Stock received or to be received by other stockholders of the Company in the event. Notwithstanding the foregoing, if at the time of a
Change in Control the Exercise Price of the Option equals or exceeds the price paid for a share of Common Stock in connection with the
Change in Control, the Committee may cancel the Option without the payment of consideration therefor.
8. Adjustments.
The shares of Common Stock subject to the Option may be adjusted or terminated in any manner as contemplated by Section 11 of the Plan.
9. Tax Liability and
Withholding. Notwithstanding any action the Company takes with respect to any or all income tax, social insurance, payroll tax,
or other tax-related withholding (“Tax-Related Items”), the ultimate liability for all Tax-Related Items is and
remains the Participant’s responsibility and the Company (a) makes no representations or undertakings regarding the treatment
of any Tax-Related Items in connection with the grant, vesting, or exercise of the Option or the subsequent sale of any shares
acquired on exercise; and (b) does not commit to structure the Option to reduce or eliminate the Participant’s liability for
Tax-Related Items.
10. Qualification
as an Incentive Stock Option. If this Option is an Incentive Stock Option, the Participant understands that in order to obtain the
benefits of an Incentive Stock Option, no sale or other disposition may be made of shares for which incentive stock option treatment is
desired within one (1) year following the date of exercise of the Option or within two (2) years from the Grant Date. The Participant
understands and agrees that the Company shall not be liable or responsible for any additional tax liability the Participant incurs in
the event that the Internal Revenue Service for any reason determines that this Option does not qualify as an incentive stock option within
the meaning of the Code.
11. Disqualifying
Disposition. If this Option is an Incentive Stock Option and the Participant disposes of the shares of Common Stock prior to the
expiration of either two (2) years from the Grant Date or one (1) year from the date the shares are transferred to the Participant
pursuant to the exercise of the Option, the Participant shall notify the Company in writing within thirty (30) days after such
disposition of the date and terms of such disposition. The Participant also agrees to provide the Company with any information
concerning any such dispositions as the Company requires for tax purposes.
12. Compliance
with Law. The exercise of the Option and the issuance and transfer of shares of Common Stock shall be subject to compliance by the
Company and the Participant with all applicable requirements of federal and state securities laws and with all applicable requirements
of any stock exchange on which the Company’s shares of Common Stock may be listed. No shares of Common Stock shall be issued pursuant
to this Option unless and until any then applicable requirements of state or federal laws and regulatory agencies have been fully complied
with to the satisfaction of the Company and its counsel. The Participant understands that the Company is under no obligation to register
the shares of Common Stock with the Securities and Exchange Commission, any state securities commission or any stock exchange to effect
such compliance.
13. Notices.
Any notice required to be delivered to the Company under this Agreement shall be in writing and addressed to the Secretary of the Company
at the Company’s principal corporate offices. Any notice required to be delivered to the Participant under this Agreement shall
be in writing and addressed to the Participant at the Participant’s address as shown in the records of the Company. Either party
may designate another address in writing (or by such other method approved by the Company) from time to time.
14. Governing
Law. This Agreement will be construed and interpreted in accordance with the laws of the State of Delaware without regard to conflict
of law principles.
15. Interpretation.
Any dispute regarding the interpretation of this Agreement shall be submitted by the Participant or the Company to the Committee for review.
The resolution of such dispute by the Committee shall be final and binding on the Participant and the Company.
16. Options
Subject to Plan. This Agreement is subject to the Plan as approved by the Company’s stockholders. The terms and provisions of
the Plan as it may be amended from time to time are hereby incorporated herein by reference. In the event of a conflict between any term
or provision contained herein and a term or provision of the Plan, the applicable terms and provisions of the Plan will govern and prevail.
17. Successors
and Assigns. The Company may assign any of its rights under this Agreement. This Agreement will be binding upon and inure to the benefit
of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein, this Agreement will be binding
upon the Participant and the Participant’s beneficiaries, executors, administrators and the person(s) to whom the Option may be
transferred by will or the laws of descent or distribution.
18. Severability.
The invalidity or unenforceability of any provision of the Plan or this Agreement shall not affect the validity or enforceability of any
other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement shall be severable and enforceable to
the extent permitted by law.
19. Discretionary
Nature of Plan. The Plan is discretionary and may be amended, cancelled or terminated by the Company at any time, in its discretion.
The grant of the Option in this Agreement does not create any contractual right or other right to receive any Options or other Awards
in the future. Future Awards, if any, will be at the sole discretion of the Company. Any amendment, modification, or termination of the
Plan shall not constitute a change or impairment of the terms and conditions of the Participant’s employment with the Company.
20. Amendment.
The Committee has the right to amend, alter, suspend, discontinue or cancel the Option, prospectively or retroactively; provided, that,
no such amendment shall adversely affect the Participant’s material rights under this Agreement without the Participant’s
consent.
21. No
Impact on Other Benefits. The value of the Participant’s Option is not part of his or her normal or expected compensation for
purposes of calculating any severance, retirement, welfare, insurance or similar employee benefit.
22. Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together will constitute one
and the same instrument. Counterpart signature pages to this Agreement transmitted by facsimile transmission, by electronic mail in portable
document format (.pdf), or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document,
will have the same effect as physical delivery of the paper document bearing an original signature.
23. Acceptance.
The Participant hereby acknowledges receipt of a copy of the Plan and this Agreement. The Participant has read and understands the terms
and provisions thereof, and accepts the Option subject to all of the terms and conditions of the Plan and this Agreement. The Participant
acknowledges that there may be adverse tax consequences upon exercise of the Option or disposition of the underlying shares and that the
Participant should consult a tax advisor prior to such exercise or disposition.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties hereto
have executed this Agreement as of the Grant Date set forth above.
| |
COMPANY: |
| |
|
| |
Signing Day Sports, Inc. |
| |
|
| |
By: |
/s/ Damon Rich |
| |
|
Name: |
Damon Rich |
| |
|
Title: |
Interim Chief Financial Officer |
| |
Address: |
8355 East Hartford Rd., Suite 100 |
| |
|
|
Scottsdale, AZ 85260 |
| |
|
|
Maricopa County, USA |
| |
PARTICIPANT: |
| |
|
| |
/s/ Daniel D. Nelson
|
| |
(Signature) |
| |
|
| |
Daniel D. Nelson |
| |
(Name) |
| |
|
| |
Address: |
8355E. Hartford Dr. Suite 100
Scottsdale, Az
85255 |
Exhibit A
STOCK OPTION EXERCISE AGREEMENT
This Stock Option Exercise
Agreement (this “Exercise Agreement”) is made and entered into as of ______________by and between Signing Day Sports, Inc., a
Delaware corporation (the “Company”), and the purchaser named below (the “Purchaser”).
Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Signing Day Sports, Inc. 2022 Equity
Incentive Plan (the “Plan”).
Purchaser Name:
Address:
Social Security Number:
1. Option. The
Purchaser was granted an option (the “Option”) to purchase shares of Common Stock pursuant to the terms of the
Plan and the Stock Option Agreement between the Company and the Purchaser dated , as follows:
Type of Option (check one):
_____Incentive Stock Option
_____Non-qualified Stock Option
Grant Date:_____________________________________
Number of Option shares:__________________________
Exercise Price per share:
Expiration Date:
2. Exercise of
Option. The Purchaser hereby elects to exercise the Option to purchase shares
of Common Stock (“Shares”), all of which are vested pursuant to the terms of the Stock Option Agreement. The
total Exercise Price for all of the Shares is (Total
Shares times Exercise Price per Share).
3. Payment
of the Exercise Price; Delivery of Required Documents. The Purchaser encloses payment in full of the total Exercise Price for the
Shares in the following form(s), as authorized by the Stock Option Agreement (check and complete as appropriate):
In cash (by certified
or bank check) in the amount of $ , receipt of which is acknowledged by the Company.
By delivery of
previously acquired shares of Common Stock duly endorsed for transfer to the Company.
_____ Through a Stock for Stock Exchange (Contact
Company CFO).
_____ By a broker-assisted cashless exercise (Contact
Company CFO).
_____ By reduction in the
number of Shares otherwise deliverable upon exercise with a Fair Market Value equal to the total Exercise Price (Contact Company CFO).
The Purchaser will deliver any other documents that the Company
requires.
4. Tax
Withholding. The Purchaser authorizes payroll withholding and will make arrangements satisfactory to the Company to pay or provide
for any applicable federal, state and local withholding obligations of the Company. The Purchaser may satisfy any federal, state or local
tax withholding obligation relating to the exercise of the Option by any of the methods set forth in the Plan or Stock Option Agreement.
The Purchaser understands that ownership of the Shares will not be transferred to the Purchaser until the total Exercise Price and all
applicable withholding taxes have been paid.
5. Notice
of Disqualifying Disposition. If the Option is an Incentive Stock Option, the Purchaser agrees to promptly notify the Secretary at
the Company if he or she transfers any of the Shares purchased pursuant to this Exercise Agreement within one (1) year from the date of
exercise of the Option or within two (2) years from the Grant Date.
6. Tax
Consequences. The Purchaser understands that there may be adverse federal or state tax consequences as a result of his or her purchase
or disposition of the Shares. The Purchaser also acknowledges that he or she has been advised to consult with a tax advisor in connection
with the purchase or disposition of the Shares. The Purchaser is not relying on the Company for tax advice.
7. Compliance
with Law. The issuance and transfer of the Shares will be subject to, and conditioned upon compliance by the Company and the Purchaser
with, all applicable federal, state and local laws and regulations and all applicable requirements of any stock exchange or automated
quotation system on which the Shares may be listed or quoted at the time of such issuance or transfer.
8. Successors
and Assigns; Binding Effect. The Company may assign any of its rights under this Exercise Agreement. This Exercise Agreement will
be binding upon and inure to the benefit of the successors and assigns of the Company. This Exercise Agreement will be binding upon the
Purchaser and the Purchaser's heirs, executors, legal representatives, successors and assigns.
9. Governing
Law. This Exercise Agreement will be construed and interpreted in accordance with the laws of the State of Delaware without regard
to conflict of law principles.
10. Severability.
The invalidity or unenforceability of any provision of this Exercise Agreement shall not affect the validity or enforceability of any
other provision, and each provision of this Exercise Agreement shall be severable and enforceable to the extent permitted by law.
11. Counterparts.
This Exercise Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together will constitute
one and the same instrument.
12. Notice.
Any notice required to be delivered to the Company under this Exercise Agreement shall be in writing and addressed to the Secretary of
the Company at the Company's principal corporate offices. Any notice required to be delivered to the Purchaser under this Exercise Agreement
shall be in writing and addressed to the Purchaser at the Purchaser's address as set forth above. Either party may designate another address
in writing (or by such other method approved by the Company) from time to time.
13. Acknowledgement.
The Purchaser understands that he or she is purchasing the Shares pursuant to the terms and conditions of the Plan and the Stock Option
Agreement, copies of which the Purchaser has read and understands.
IN WITNESS WHEREOF, the parties
have executed this Exercise Agreement as of the date first above written.
| |
COMPANY: |
| |
|
|
| |
Signing Day Sports, Inc. |
| |
|
|
| |
By: |
|
| |
|
Name: |
Damon Rich |
| |
|
Title: |
Interim Chief Financial Officer |
| |
|
|
|
| |
PURCHASER: |
| |
|
| |
|
| |
|
| |
[Name] |
Exhibit 10
STOCK OPTION AGREEMENT
This Stock Option
Agreement (this “Agreement”) is made and entered into as of the Grant Date specified below by and between Signing Day
Sports, Inc., a Delaware corporation (the “Company”), and the participant named below (the “Participant”).
| Name of Participant: |
Daniel Nelson |
| |
|
| Grant Date: |
September 28, 2022 |
| |
|
| Expiration Date: |
September 28, 2032 /s/ [Initials] /s/ [Initials] |
| |
|
| Exercise Price: |
$0.62 |
| |
|
| Number of Option Shares: |
150,000 |
| |
|
| Type of Option: |
NSO |
| |
|
| Vesting Start Date: |
September 28, 2022 |
| |
|
| Vesting Schedule: |
20% of the base shares vest immediately; 1/4th of the remaining shares underlying the
option shall vest on a quarterly basis for one year ending September 28, 2023 |
1.1. Grant.
The Company hereby grants to the Participant an option (the “Option”) to purchase the total number of shares of Common
Stock of the Company equal to the number of Option Shares set forth above, at the Exercise Price set forth above. The Option is being
granted pursuant to the terms of the Company’s 2022 Equity Incentive Plan (the “Plan”). Capitalized terms used
but not defined herein will have the meanings ascribed to them in the Plan.
1.2. Type
of Option. The Option is intended to be either a Non-qualified Stock Option (i.e., not an Incentive Stock Option) or an Incentive
Stock Option within the meaning of Section 422 of the Code, as indicated above, although the Company makes no representation or guarantee
that the Option will qualify as an Incentive Stock Option. To the extent that the aggregate Fair Market Value (determined on the Grant
Date) of the shares of Common Stock with respect to which Incentive Stock Options are exercisable for the first time by the Participant
during any calendar year (under all plans of the Company and its Affiliates) exceeds $100,000, the Option or portion thereof which exceeds
such limit (according to the order in which they were granted) shall be treated as a Non-qualified Stock Option.
1.3. Consideration.
The grant of the Option is made in consideration of the services to be rendered by the Participant to the Company and is subject to the
terms and conditions of the Plan.
| 2. | Exercise Period; Vesting. |
2.1. Vesting
Schedule. The Option will become vested and exercisable in accordance with the Vesting Schedule specified above until the Option is
100% vested. The unvested portion of the Option will not be exercisable on or after the Participant’s termination of Continuous
Service.
2.2. Expiration.
The Option will expire on the Expiration Date set forth above, or earlier as provided in this Agreement or the Plan.
| 3. | Termination of Continuous Service. |
3.1. Termination
for Reasons Other Than Cause, Death or Disability. If the Participant’s Continuous Service is terminated for any reason other
than Cause, death or Disability, the Participant may exercise the vested portion of the Option, but only within such period of time ending
on the earlier of (a) the date that is three months following the termination of the Participant’s Continuous Service or (b) the
Expiration Date.
3.2. Termination
for Cause. If the Participant’s Continuous Service is terminated for Cause, the Option (whether vested or unvested) shall immediately
terminate and cease to be exercisable.
3.3. Termination
Due to Disability. If the Participant’s Continuous Service terminates as a result of the Participant’s Disability, the
Participant may exercise the vested portion of the Option, but only within such period of time ending on the earlier of (a) the date that
is 12 months following the Participant’s termination of Continuous Service or (b) the Expiration Date.
3.4. Termination
Due to Death. If the Participant’s Continuous Service terminates as a result of the Participant’s death, or the Participant
dies within a period following termination of the Participant’s Continuous Service during which the vested portion of the Option
remains exercisable, the vested portion of the Option may be exercised by the Participant’s estate, by a person who acquired the
right to exercise the Option by bequest or inheritance or by the person designated to exercise the Option upon the Participant’s
death, but only within the time period ending on the earlier of (a) the date that is 12 months following the Participant’s death
or (b) the Expiration Date.
3.5. Extension
of Termination Date. If following the Participant’s termination of Continuous Service for any reason the exercise of the Option
is prohibited because the exercise of the Option would violate the registration requirements under the Securities Act or any other state
or federal securities law or the rules of any securities exchange or interdealer quotation system, then the expiration of the Option shall
be tolled until the date that is thirty (30) days after the end of the period during which the exercise of the Option would be in violation
of such registration or other securities requirements.
4.1. Election
to Exercise. To exercise the Option, the Participant (or in the case of exercise after the Participant’s death or
incapacity, the Participant’s executor, administrator, heir or legatee, as the case may be) must deliver to the Company an
executed stock option exercise agreement in the form attached hereto as Exhibit A, or as is approved by the Committee from
time to time (the “Exercise Agreement”), which shall set forth, inter alia: (a) the Participant’s
election to exercise the Option; (b) the number of shares of Common Stock being purchased; (c) any restrictions imposed on the
shares; and (d) any representations, warranties and agreements regarding the Participant’s investment intent and access to
information as may be required by the Company to comply with applicable securities laws. If someone other than the Participant
exercises the Option, then such person must submit documentation reasonably acceptable to the Company verifying that such
person has the legal right to exercise the Option.
4.2. Payment
of Exercise Price. The entire Exercise Price of the Option shall be payable in full at the time of exercise to the extent permitted
by applicable statutes and regulations, either:
(a) in cash or by certified or bank check
at the time the Option is exercised; (b) by delivery to the Company of other shares of Common Stock, duly endorsed for transfer to the
Company, with a Fair Market Value on the date of delivery equal to the Exercise Price (or portion thereof) due for the number of shares
being acquired, or by means of attestation whereby the Participant identifies for delivery specific shares that have a Fair Market Value
on the date of attestation equal to the Exercise Price (or portion thereof) and receives a number of shares equal to the difference between
the number of shares thereby purchased and the number of identified attestation shares (a “Stock for Stock Exchange”);
(c) through a “cashless exercise program” established with a broker; (d) by reduction in the number of shares otherwise deliverable
upon exercise of such Option with a Fair Market Value equal to the aggregate Exercise Price at the time of exercise; (e) by any combination
of the foregoing methods; or (f) in any other form of legal consideration that may be acceptable to the Committee.
4.3. Withholding.
Prior to the issuance of shares upon the exercise of the Option, the Participant must make arrangements satisfactory to the Company to
pay or provide for any applicable federal, state and local withholding obligations of the Company. The Participant may satisfy any federal,
state or local tax withholding obligation relating to the exercise of the Option by any of the following means: (a) tendering a cash payment;
(b) authorizing the Company to withhold shares of Common Stock from the shares of Common Stock otherwise issuable to the Participant as
a result of the exercise of the Option; provided, however, that no shares of Common Stock are withheld with a value exceeding the
minimum amount of tax required to be withheld by law; or (c) delivering to the Company previously owned and unencumbered shares of Common
Stock. The Company has the right to withhold from any compensation paid to a Participant.
4.4. Issuance
of Shares. Provided that the Exercise Agreement and payment are in form and substance satisfactory to the Company, the Company shall
issue the shares of Common Stock registered in the name of the Participant, the Participant’s authorized assignee, or the Participant’s
legal representative which shall be evidenced by stock certificates representing the shares with the appropriate legends affixed thereto,
appropriate entry on the books of the Company or of a duly authorized transfer agent, or other appropriate means as determined by the
Company.
| 5. | No Right to Continued Service; No Rights as Stockholder. Neither
the Plan nor this Agreement shall confer upon the Participant any right to be retained in any position, as an Employee, Consultant or
Director of the Company. Further, nothing in the Plan or this Agreement shall be construed to limit the discretion of the Company to terminate
the Participant’s Continuous Service at any time, with or without Cause. The Participant shall not have any rights as a stockholder
with respect to any shares of Common Stock subject to the Option prior to the date of exercise of the Option. |
| 6. | Transferability. The Option is not transferable by the Participant
other than to a designated beneficiary upon the Participant’s death or by will or the laws of descent and distribution, and is exercisable
during the Participant’s lifetime only by him or her. No assignment or transfer of the Option, or the rights represented thereby,
whether voluntary or involuntary, by operation of law or otherwise (except to a designated beneficiary upon death by will or the laws
of descent or distribution) will vest in the assignee or transferee any interest or right herein whatsoever, but immediately upon such
assignment or transfer the Option will terminate and become of no further effect. |
| 7. | Change in Control. In the event of a Change in Control, the Committee
may, in its discretion and upon at least ten (10) days’ advance notice to the Participant, cancel the Option and pay to the Participant
the value of the Option based upon the price per share of Common Stock received or to be received by other stockholders of the Company
in the event. Notwithstanding the foregoing, if at the time of a Change in Control the Exercise Price of the Option equals or exceeds
the price paid for a share of Common Stock in connection with the Change in Control, the Committee may cancel the Option without the payment
of consideration therefor. |
| 8. | Adjustments. The shares of Common Stock subject to the Option may
be adjusted or terminated in any manner as contemplated by Section 11 of the Plan. |
| 9. | Tax Liability and Withholding. Notwithstanding any action the Company
takes with respect to any or all income tax, social insurance, payroll tax, or other tax-related withholding (“Tax- Related Items”),
the ultimate liability for all Tax-Related Items is and remains the Participant’s responsibility and the Company (a) makes no representations
or undertakings regarding the treatment of any Tax-Related Items in connection with the grant, vesting, or exercise of the Option or the
subsequent sale of any shares acquired on exercise; and (b) does not commit to structure the Option to reduce or eliminate the Participant’s
liability for Tax-Related Items. |
| 10. | Qualification as an Incentive Stock Option. If this Option is an
Incentive Stock Option, the Participant understands that in order to obtain the benefits of an Incentive Stock Option, no sale or other
disposition may be made of shares for which incentive stock option treatment is desired within one (1) year following the date of exercise
of the Option or within two (2) years from the Grant Date. The Participant understands and agrees that the Company shall not be liable
or responsible for any additional tax liability the Participant incurs in the event that the Internal Revenue Service for any reason determines
that this Option does not qualify as an incentive stock option within the meaning of the Code. |
| 11. | Disqualifying Disposition. If this Option is an Incentive Stock Option
and the Participant disposes of the shares of Common Stock prior to the expiration of either two (2) years from the Grant Date or one
(1) year from the date the shares are transferred to the Participant pursuant to the exercise of the Option, the Participant shall notify
the Company in writing within thirty (30) days after such disposition of the date and terms of such disposition. The Participant also
agrees to provide the Company with any information concerning any such dispositions as the Company requires for tax purposes. |
| 12. | Compliance with Law. The exercise of the Option and the issuance
and transfer of shares of Common Stock shall be subject to compliance by the Company and the Participant with all applicable requirements
of federal and state securities laws and with all applicable requirements of any stock exchange on which the Company’s shares of
Common Stock may be listed. No shares of Common Stock shall be issued pursuant to this Option unless and until any then applicable requirements
of state or federal laws and regulatory agencies have been fully complied with to the satisfaction of the Company and its counsel. The
Participant understands that the Company is under no obligation to register the shares of Common Stock with the Securities and Exchange
Commission, any state securities commission or any stock exchange to effect such compliance. |
| 13. | Notices. Any notice required to be delivered to the Company under
this Agreement shall be in writing and addressed to the Secretary of the Company at the Company’s principal corporate offices. Any
notice required to be delivered to the Participant under this Agreement shall be in writing and addressed to the Participant at the Participant’s
address as shown in the records of the Company. Either party may designate another address in writing (or by such other method approved
by the Company) from time to time. |
| 14. | Governing Law. This Agreement will be construed and interpreted in
accordance with the laws of the State of Delaware without regard to conflict of law principles. |
| 15. | Interpretation. Any dispute regarding the interpretation of this
Agreement shall be submitted by the Participant or the Company to the Committee for review. The resolution of such dispute by the Committee
shall be final and binding on the Participant and the Company. |
| 16. | Options Subject to Plan. This Agreement is subject to the Plan as
approved by the Company’s stockholders. The terms and provisions of the Plan as it may be amended from time to time are hereby incorporated
herein by reference. In the event of a conflict between any term or provision contained herein and a term or provision of the Plan, the
applicable terms and provisions of the Plan will govern and prevail. |
| 17. | Successors and Assigns. The Company may assign any of its rights
under this Agreement. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject
to the restrictions on transfer set forth herein, this Agreement will be binding upon the Participant and the Participant’s beneficiaries,
executors, administrators and the person(s) to whom the Option may be transferred by will or the laws of descent or distribution. |
| 18. | Severability. The invalidity or unenforceability of any provision
of the Plan or this Agreement shall not affect the validity or enforceability of any other provision of the Plan or this Agreement, and
each provision of the Plan and this Agreement shall be severable and enforceable to the extent permitted by law. |
| 19. | Discretionary Nature of Plan. The Plan is discretionary and may be
amended, cancelled or terminated by the Company at any time, in its discretion. The grant of the Option in this Agreement does not create
any contractual right or other right to receive any Options or other Awards in the future. Future Awards, if any, will be at the sole
discretion of the Company. Any amendment, modification, or termination of the Plan shall not constitute a change or impairment of the
terms and conditions of the Participant’s employment with the Company. |
| 20. | Amendment. The Committee has the right to amend, alter, suspend,
discontinue or cancel the Option, prospectively or retroactively; provided, that, no such amendment shall adversely affect the
Participant’s material rights under this Agreement without the Participant’s consent. |
| 21. | No Impact on Other Benefits. The value of the Participant’s
Option is not part of his or her normal or expected compensation for purposes of calculating any severance, retirement, welfare, insurance
or similar employee benefit. |
| 22. | Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original but all of which together will constitute one and the same instrument. Counterpart signature pages
to this Agreement transmitted by facsimile transmission, by electronic mail in portable document format (.pdf), or by any other electronic
means intended to preserve the original graphic and pictorial appearance of a document, will have the same effect as physical delivery
of the paper document bearing an original signature. |
| 23. | Acceptance. The Participant hereby acknowledges receipt of a copy
of the Plan and this Agreement. The Participant has read and understands the terms and provisions thereof, and accepts the Option subject
to all of the terms and conditions of the Plan and this Agreement. The Participant acknowledges that there may be adverse tax consequences
upon exercise of the Option or disposition of the underlying shares and that the Participant should consult a tax advisor prior to such
exercise or disposition. |
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties hereto
have executed this Agreement as of the Grant Date set forth above.
| |
COMPANY: |
| |
|
|
| |
Signing Day Sports, Inc. |
| |
|
|
| |
By: |
/s/ David Wolfson |
| |
|
Name: |
David Wolfson |
| |
|
Title: |
Chief Financial Officer |
| |
Address: |
8355 E. Hartford Dr. Suite 100 |
| |
|
Scottsdale, AZ, 85255 |
| |
|
Maricopa County, USA |
| |
PARTICIPANT: |
| |
|
|
| |
/s/ Daniel Nelson |
| |
(Signature) |
| |
|
| |
Daniel Nelson |
| |
(Name) |
| |
|
|
| |
Address: |
8355 E. Hartford Dr. Suite 100 |
| |
|
Scottsdale, Az 85255 |
Exhibit A
STOCK OPTION EXERCISE AGREEMENT
This
Stock Option Exercise Agreement (this “Exercise Agreement”) is made and entered into as of _______________ by and
between Signing Day Sports, Inc., a Delaware corporation (the “Company”), and the purchaser named below (the
“Purchaser”). Capitalized terms used but not defined herein shall have the meanings ascribed to them in the
Signing Day Sports, Inc. 2022 Equity Incentive Plan (the “Plan”).
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Purchaser Name: |
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Address: |
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Social Security Number: |
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| 1. | Option. The Purchaser was granted
an option (the “Option”) to purchase shares of Common Stock pursuant to the terms of the Plan and the Stock Option
Agreement between the Company and the Purchaser dated ______________, as follows: |
Type of Option (check one):
Incentive Stock Option
Non-qualified Stock Option
Grant
Date:
Number
of Option shares:
Exercise
Price per share:
Expiration
Date:
| 2. | Exercise of Option. The Purchaser
hereby elects to exercise the Option to purchase
shares of Common Stock (“Shares”), all of which are vested pursuant to the terms
of the Stock Option Agreement. The total Exercise Price for all of the Shares is
(Total Shares times Exercise Price per Share). |
| 3. | Payment of the Exercise Price; Delivery of Required Documents. The
Purchaser encloses payment in full of the total Exercise Price for the Shares in the following form(s), as authorized by the Stock Option
Agreement (check and complete as appropriate): |
In cash (by certified or bank check) in the amount of $________, receipt of which is acknowledged by the Company.
By delivery of previously acquired shares
of Common Stock duly endorsed for transfer to the Company.
Through a Stock for Stock Exchange (Contact Company CFO).
By a broker-assisted cashless exercise (Contact Company CFO).
By reduction in the number of Shares otherwise deliverable upon exercise with a Fair Market Value equal to the total Exercise Price
(Contact Company CFO).
The Purchaser will deliver any other documents that the Company
requires.
| 4. | Tax Withholding. The Purchaser authorizes payroll withholding and
will make arrangements satisfactory to the Company to pay or provide for any applicable federal, state and local withholding obligations
of the Company. The Purchaser may satisfy any federal, state or local tax withholding obligation relating to the exercise of the Option
by any of the methods set forth in the Plan or Stock Option Agreement. The Purchaser understands that ownership of the Shares will not
be transferred to the Purchaser until the total Exercise Price and all applicable withholding taxes have been paid. |
| 5. | Notice of Disqualifying Disposition. If the Option is an Incentive
Stock Option, the Purchaser agrees to promptly notify the Secretary at the Company if he or she transfers any of the Shares purchased
pursuant to this Exercise Agreement within one (1) year from the date of exercise of the Option or within two (2) years from the Grant
Date. |
| 6. | Tax Consequences. The Purchaser understands that there may be adverse
federal or state tax consequences as a result of his or her purchase or disposition of the Shares. The Purchaser also acknowledges that
he or she has been advised to consult with a tax advisor in connection with the purchase or disposition of the Shares. The Purchaser is
not relying on the Company for tax advice. |
| 7. | Compliance with Law. The issuance and transfer of the Shares will
be subject to, and conditioned upon compliance by the Company and the Purchaser with, all applicable federal, state and local laws and
regulations and all applicable requirements of any stock exchange or automated quotation system on which the Shares may be listed or quoted
at the time of such issuance or transfer. |
| 8. | Successors and Assigns; Binding Effect. The Company may assign any
of its rights under this Exercise Agreement. This Exercise Agreement will be binding upon and inure to the benefit of the successors and
assigns of the Company. This Exercise Agreement will be binding upon the Purchaser and the Purchaser’s heirs, executors, legal representatives,
successors and assigns. |
| 9. | Governing Law. This Exercise Agreement will be construed and interpreted
in accordance with the laws of the State of Delaware without regard to conflict of law principles. |
| 10. | Severability. The invalidity or unenforceability of any provision
of this Exercise Agreement shall not affect the validity or enforceability of any other provision, and each provision of this Exercise
Agreement shall be severable and enforceable to the extent permitted by law. |
| 11. | Counterparts. This Exercise Agreement may be executed in counterparts,
each of which shall be deemed an original but all of which together will constitute one and the same instrument. |
| 12. | Notice. Any notice required to be delivered to the Company under
this Exercise Agreement shall be in writing and addressed to the Secretary of the Company at the Company’s principal corporate offices.
Any notice required to be delivered to the Purchaser under this Exercise Agreement shall be in writing and addressed to the Purchaser
at the Purchaser’s address as set forth above. Either party may designate another address in writing (or by such other method approved
by the Company) from time to time. |
| 13. | Acknowledgement. The Purchaser understands that he or she is purchasing
the Shares pursuant to the terms and conditions of the Plan and the Stock Option Agreement, copies of which the Purchaser has read and
understands. |
IN WITNESS WHEREOF, the parties have executed
this Exercise Agreement as of the date first above written.
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COMPANY: |
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Signing Day Sports, Inc. |
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By: |
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Name: |
David Wolfson |
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Title: |
Chief Financial Officer |
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PURCHASER: |
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[Name] |
Exhibit 11
STOCK OPTION AGREEMENT
This Stock Option
Agreement (this “Agreement”) is made and entered into as of the Grant Date specified below by and between Signing Day
Sports, Inc., a Delaware corporation (the “Company”), and the participant named below (the “Participant”).
| Name of Participant: |
Daniel Nelson |
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| Grant Date: |
September 28, 2022 |
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| Expiration Date: |
September 28, 2032 /s/ [Initials] /s/ [Initials] |
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| Exercise Price: |
$0.62 |
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| Number of Option Shares: |
25,000 |
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| Type of Option: |
NSO |
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| Vesting Start Date: |
September 28, 2022 |
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| Vesting Schedule: |
Vest Immediately |
1.1. Grant.
The Company hereby grants to the Participant an option (the “Option”) to purchase the total number of shares of Common
Stock of the Company equal to the number of Option Shares set forth above, at the Exercise Price set forth above. The Option is being
granted pursuant to the terms of the Company’s 2022 Equity Incentive Plan (the “Plan”). Capitalized terms used
but not defined herein will have the meanings ascribed to them in the Plan.
1.2. Type
of Option. The Option is intended to be either a Non-qualified Stock Option (i.e., not an Incentive Stock Option) or an Incentive
Stock Option within the meaning of Section 422 of the Code, as indicated above, although the Company makes no representation or guarantee
that the Option will qualify as an Incentive Stock Option. To the extent that the aggregate Fair Market Value (determined on the Grant
Date) of the shares of Common Stock with respect to which Incentive Stock Options are exercisable for the first time by the Participant
during any calendar year (under all plans of the Company and its Affiliates) exceeds $100,000, the Option or portion thereof which exceeds
such limit (according to the order in which they were granted) shall be treated as a Non-qualified Stock Option.
1.3. Consideration.
The grant of the Option is made in consideration of the services to be rendered by the Participant to the Company and is subject to the
terms and conditions of the Plan.
| 2. | Exercise Period; Vesting. |
2.1. Vesting
Schedule. The Option will become vested and exercisable in accordance with the Vesting Schedule specified above until the Option is
100% vested. The unvested portion of the Option will not be exercisable on or after the Participant’s termination of Continuous
Service.
2.2. Expiration.
The Option will expire on the Expiration Date set forth above, or earlier as provided in this Agreement or the Plan.
| 3. | Termination of Continuous Service. |
3.1. Termination
for Reasons Other Than Cause, Death or Disability. If the Participant’s Continuous Service is terminated for any reason other
than Cause, death or Disability, the Participant may exercise the vested portion of the Option, but only within such period of time ending
on the earlier of (a) the date that is three months following the termination of the Participant’s Continuous Service or (b) the
Expiration Date.
3.2. Termination
for Cause. If the Participant’s Continuous Service is terminated for Cause, the Option (whether vested or unvested) shall immediately
terminate and cease to be exercisable.
3.3. Termination
Due to Disability. If the Participant’s Continuous Service terminates as a result of the Participant’s Disability, the
Participant may exercise the vested portion of the Option, but only within such period of time ending on the earlier of (a) the date that
is 12 months following the Participant’s termination of Continuous Service or (b) the Expiration Date.
3.4. Termination
Due to Death. If the Participant’s Continuous Service terminates as a result of the Participant’s death, or the Participant
dies within a period following termination of the Participant’s Continuous Service during which the vested portion of the Option
remains exercisable, the vested portion of the Option may be exercised by the Participant’s estate, by a person who acquired the
right to exercise the Option by bequest or inheritance or by the person designated to exercise the Option upon the Participant’s
death, but only within the time period ending on the earlier of (a) the date that is 12 months following the Participant’s death
or (b) the Expiration Date.
3.5. Extension
of Termination Date. If following the Participant’s termination of Continuous Service for any reason the exercise of the Option
is prohibited because the exercise of the Option would violate the registration requirements under the Securities Act or any other state
or federal securities law or the rules of any securities exchange or interdealer quotation system, then the expiration of the Option shall
be tolled until the date that is thirty (30) days after the end of the period during which the exercise of the Option would be in violation
of such registration or other securities requirements.
4.1. Election
to Exercise. To exercise the Option, the Participant (or in the case of exercise after the Participant’s death or
incapacity, the Participant’s executor, administrator, heir or legatee, as the case may be) must deliver to the Company an
executed stock option exercise agreement in the form attached hereto as Exhibit A, or as is approved by the Committee from
time to time (the “Exercise Agreement”), which shall set forth, inter alia: (a) the Participant’s
election to exercise the Option; (b) the number of shares of Common Stock being purchased; (c) any restrictions imposed on the
shares; and (d) any representations, warranties and agreements regarding the Participant’s investment intent and access to
information as may be required by the Company to comply with applicable securities laws. If someone other than the Participant
exercises the Option, then such person must submit documentation reasonably acceptable to the Company verifying that such
person has the legal right to exercise the Option.
4.2. Payment
of Exercise Price. The entire Exercise Price of the Option shall be payable in full at the time of exercise to the extent permitted
by applicable statutes and regulations, either:
(a) in cash or by certified or bank check
at the time the Option is exercised; (b) by delivery to the Company of other shares of Common Stock, duly endorsed for transfer to the
Company, with a Fair Market Value on the date of delivery equal to the Exercise Price (or portion thereof) due for the number of shares
being acquired, or by means of attestation whereby the Participant identifies for delivery specific shares that have a Fair Market Value
on the date of attestation equal to the Exercise Price (or portion thereof) and receives a number of shares equal to the difference between
the number of shares thereby purchased and the number of identified attestation shares (a “Stock for Stock Exchange”);
(c) through a “cashless exercise program” established with a broker; (d) by reduction in the number of shares otherwise deliverable
upon exercise of such Option with a Fair Market Value equal to the aggregate Exercise Price at the time of exercise; (e) by any combination
of the foregoing methods; or (f) in any other form of legal consideration that may be acceptable to the Committee.
4.3. Withholding.
Prior to the issuance of shares upon the exercise of the Option, the Participant must make arrangements satisfactory to the Company to
pay or provide for any applicable federal, state and local withholding obligations of the Company. The Participant may satisfy any federal,
state or local tax withholding obligation relating to the exercise of the Option by any of the following means: (a) tendering a cash payment;
(b) authorizing the Company to withhold shares of Common Stock from the shares of Common Stock otherwise issuable to the Participant as
a result of the exercise of the Option; provided, however, that no shares of Common Stock are withheld with a value exceeding the
minimum amount of tax required to be withheld by law; or (c) delivering to the Company previously owned and unencumbered shares of Common
Stock. The Company has the right to withhold from any compensation paid to a Participant.
4.4. Issuance
of Shares. Provided that the Exercise Agreement and payment are in form and substance satisfactory to the Company, the Company shall
issue the shares of Common Stock registered in the name of the Participant, the Participant’s authorized assignee, or the Participant’s
legal representative which shall be evidenced by stock certificates representing the shares with the appropriate legends affixed thereto,
appropriate entry on the books of the Company or of a duly authorized transfer agent, or other appropriate means as determined by the
Company.
| 5. | No Right to Continued Service; No Rights as Stockholder. Neither
the Plan nor this Agreement shall confer upon the Participant any right to be retained in any position, as an Employee, Consultant or
Director of the Company. Further, nothing in the Plan or this Agreement shall be construed to limit the discretion of the Company to terminate
the Participant’s Continuous Service at any time, with or without Cause. The Participant shall not have any rights as a stockholder
with respect to any shares of Common Stock subject to the Option prior to the date of exercise of the Option. |
| 6. | Transferability. The Option is not transferable by the Participant
other than to a designated beneficiary upon the Participant’s death or by will or the laws of descent and distribution, and is exercisable
during the Participant’s lifetime only by him or her. No assignment or transfer of the Option, or the rights represented thereby,
whether voluntary or involuntary, by operation of law or otherwise (except to a designated beneficiary upon death by will or the laws
of descent or distribution) will vest in the assignee or transferee any interest or right herein whatsoever, but immediately upon such
assignment or transfer the Option will terminate and become of no further effect. |
| 7. | Change in Control. In the event of a Change in Control, the Committee
may, in its discretion and upon at least ten (10) days’ advance notice to the Participant, cancel the Option and pay to the Participant
the value of the Option based upon the price per share of Common Stock received or to be received by other stockholders of the Company
in the event. Notwithstanding the foregoing, if at the time of a Change in Control the Exercise Price of the Option equals or exceeds
the price paid for a share of Common Stock in connection with the Change in Control, the Committee may cancel the Option without the payment
of consideration therefor. |
| 8. | Adjustments. The shares of Common Stock subject to the Option may
be adjusted or terminated in any manner as contemplated by Section 11 of the Plan. |
| 9. | Tax Liability and Withholding. Notwithstanding any action the Company
takes with respect to any or all income tax, social insurance, payroll tax, or other tax-related withholding (“Tax- Related Items”),
the ultimate liability for all Tax-Related Items is and remains the Participant’s responsibility and the Company (a) makes no representations
or undertakings regarding the treatment of any Tax-Related Items in connection with the grant, vesting, or exercise of the Option or the
subsequent sale of any shares acquired on exercise; and (b) does not commit to structure the Option to reduce or eliminate the Participant’s
liability for Tax-Related Items. |
| 10. | Qualification as an Incentive Stock Option. If this Option is an
Incentive Stock Option, the Participant understands that in order to obtain the benefits of an Incentive Stock Option, no sale or other
disposition may be made of shares for which incentive stock option treatment is desired within one (1) year following the date of exercise
of the Option or within two (2) years from the Grant Date. The Participant understands and agrees that the Company shall not be liable
or responsible for any additional tax liability the Participant incurs in the event that the Internal Revenue Service for any reason determines
that this Option does not qualify as an incentive stock option within the meaning of the Code. |
| 11. | Disqualifying Disposition. If this Option is an Incentive Stock Option
and the Participant disposes of the shares of Common Stock prior to the expiration of either two (2) years from the Grant Date or one
(1) year from the date the shares are transferred to the Participant pursuant to the exercise of the Option, the Participant shall notify
the Company in writing within thirty (30) days after such disposition of the date and terms of such disposition. The Participant also
agrees to provide the Company with any information concerning any such dispositions as the Company requires for tax purposes. |
| 12. | Compliance with Law. The exercise of the Option and the issuance
and transfer of shares of Common Stock shall be subject to compliance by the Company and the Participant with all applicable requirements
of federal and state securities laws and with all applicable requirements of any stock exchange on which the Company’s shares of
Common Stock may be listed. No shares of Common Stock shall be issued pursuant to this Option unless and until any then applicable requirements
of state or federal laws and regulatory agencies have been fully complied with to the satisfaction of the Company and its counsel. The
Participant understands that the Company is under no obligation to register the shares of Common Stock with the Securities and Exchange
Commission, any state securities commission or any stock exchange to effect such compliance. |
| 13. | Notices. Any notice required to be delivered to the Company under
this Agreement shall be in writing and addressed to the Secretary of the Company at the Company’s principal corporate offices. Any
notice required to be delivered to the Participant under this Agreement shall be in writing and addressed to the Participant at the Participant’s
address as shown in the records of the Company. Either party may designate another address in writing (or by such other method approved
by the Company) from time to time. |
| 14. | Governing Law. This Agreement will be construed and interpreted in
accordance with the laws of the State of Delaware without regard to conflict of law principles. |
| 15. | Interpretation. Any dispute regarding the interpretation of this
Agreement shall be submitted by the Participant or the Company to the Committee for review. The resolution of such dispute by the Committee
shall be final and binding on the Participant and the Company. |
| 16. | Options Subject to Plan. This Agreement is subject to the Plan as
approved by the Company’s stockholders. The terms and provisions of the Plan as it may be amended from time to time are hereby incorporated
herein by reference. In the event of a conflict between any term or provision contained herein and a term or provision of the Plan, the
applicable terms and provisions of the Plan will govern and prevail. |
| 17. | Successors and Assigns. The Company may assign any of its rights
under this Agreement. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject
to the restrictions on transfer set forth herein, this Agreement will be binding upon the Participant and the Participant’s beneficiaries,
executors, administrators and the person(s) to whom the Option may be transferred by will or the laws of descent or distribution. |
| 18. | Severability. The invalidity or unenforceability of any provision
of the Plan or this Agreement shall not affect the validity or enforceability of any other provision of the Plan or this Agreement, and
each provision of the Plan and this Agreement shall be severable and enforceable to the extent permitted by law. |
| 19. | Discretionary Nature of Plan. The Plan is discretionary and may be
amended, cancelled or terminated by the Company at any time, in its discretion. The grant of the Option in this Agreement does not create
any contractual right or other right to receive any Options or other Awards in the future. Future Awards, if any, will be at the sole
discretion of the Company. Any amendment, modification, or termination of the Plan shall not constitute a change or impairment of the
terms and conditions of the Participant’s employment with the Company. |
| 20. | Amendment. The Committee has the right to amend, alter, suspend,
discontinue or cancel the Option, prospectively or retroactively; provided, that, no such amendment shall adversely affect the
Participant’s material rights under this Agreement without the Participant’s consent. |
| 21. | No Impact on Other Benefits. The value of the Participant’s
Option is not part of his or her normal or expected compensation for purposes of calculating any severance, retirement, welfare, insurance
or similar employee benefit. |
| 22. | Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original but all of which together will constitute one and the same instrument. Counterpart signature pages
to this Agreement transmitted by facsimile transmission, by electronic mail in portable document format (.pdf), or by any other electronic
means intended to preserve the original graphic and pictorial appearance of a document, will have the same effect as physical delivery
of the paper document bearing an original signature. |
| 23. | Acceptance. The Participant hereby acknowledges receipt of a copy
of the Plan and this Agreement. The Participant has read and understands the terms and provisions thereof, and accepts the Option subject
to all of the terms and conditions of the Plan and this Agreement. The Participant acknowledges that there may be adverse tax consequences
upon exercise of the Option or disposition of the underlying shares and that the Participant should consult a tax advisor prior to such
exercise or disposition. |
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties hereto
have executed this Agreement as of the Grant Date set forth above.
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COMPANY: |
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Signing Day Sports, Inc. |
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By: |
/s/ David Wolfson |
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Name: |
David Wolfson |
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Title: |
Chief Financial Officer |
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Address: |
8355 E. Hartford Dr. Suite 100 |
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Scottsdale, AZ, 85255 |
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Maricopa County, USA |
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PARTICIPANT: |
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/s/ Daniel Nelson |
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(Signature) |
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Daniel Nelson |
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(Name) |
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Address: |
8355 E. Hartford Dr Suite 100 |
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Scottsdale, Az 85255 |
Exhibit A
STOCK OPTION EXERCISE AGREEMENT
This
Stock Option Exercise Agreement (this “Exercise Agreement”) is made and entered into as of by and between Signing
Day Sports, Inc., a Delaware corporation (the “Company”), and the purchaser named below (the
“Purchaser”). Capitalized terms used but not defined herein shall have the meanings ascribed to them in the
Signing Day Sports, Inc. 2022 Equity Incentive Plan (the “Plan”).
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Purchaser Name: |
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Address: |
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Social Security Number: |
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| 1. | Option. The Purchaser was granted
an option (the “Option”) to purchase shares of Common Stock pursuant to the terms of the Plan and the Stock Option
Agreement between the Company and the Purchaser dated____________, as follows: |
Type of Option (check one):
Incentive
Stock Option
Non-qualified Stock Option
Grant
Date:
Number
of Option shares:
Exercise
Price per share:
Expiration
Date:
| 2. | Exercise of Option. The Purchaser
hereby elects to exercise the Option to purchase
shares of Common Stock (“Shares”), all of which are vested pursuant to the terms
of the Stock Option Agreement. The total Exercise Price for all of the Shares is
(Total Shares times Exercise Price per Share). |
| 3. | Payment of the Exercise Price; Delivery of Required Documents. The
Purchaser encloses payment in full of the total Exercise Price for the Shares in the following form(s), as authorized by the Stock Option
Agreement (check and complete as appropriate): |
In cash (by certified or bank check) in the amount of $_________, receipt of which is acknowledged by the Company.
By delivery of previously acquired shares
of Common Stock duly endorsed for transfer to the Company.
Through a Stock for Stock Exchange (Contact Company CFO).
By a broker-assisted cashless exercise (Contact Company CFO).
By reduction in the number of Shares otherwise deliverable upon exercise with a Fair Market Value equal to the total Exercise Price
(Contact Company CFO).
The Purchaser will deliver any other documents that the Company
requires.
| 4. | Tax Withholding. The Purchaser authorizes payroll withholding and
will make arrangements satisfactory to the Company to pay or provide for any applicable federal, state and local withholding obligations
of the Company. The Purchaser may satisfy any federal, state or local tax withholding obligation relating to the exercise of the Option
by any of the methods set forth in the Plan or Stock Option Agreement. The Purchaser understands that ownership of the Shares will not
be transferred to the Purchaser until the total Exercise Price and all applicable withholding taxes have been paid. |
| 5. | Notice of Disqualifying Disposition. If the Option is an Incentive
Stock Option, the Purchaser agrees to promptly notify the Secretary at the Company if he or she transfers any of the Shares purchased
pursuant to this Exercise Agreement within one (1) year from the date of exercise of the Option or within two (2) years from the Grant
Date. |
| 6. | Tax Consequences. The Purchaser understands that there may be adverse
federal or state tax consequences as a result of his or her purchase or disposition of the Shares. The Purchaser also acknowledges that
he or she has been advised to consult with a tax advisor in connection with the purchase or disposition of the Shares. The Purchaser is
not relying on the Company for tax advice. |
| 7. | Compliance with Law. The issuance and transfer of the Shares will
be subject to, and conditioned upon compliance by the Company and the Purchaser with, all applicable federal, state and local laws and
regulations and all applicable requirements of any stock exchange or automated quotation system on which the Shares may be listed or quoted
at the time of such issuance or transfer. |
| 8. | Successors and Assigns; Binding Effect. The Company may assign any
of its rights under this Exercise Agreement. This Exercise Agreement will be binding upon and inure to the benefit of the successors and
assigns of the Company. This Exercise Agreement will be binding upon the Purchaser and the Purchaser’s heirs, executors, legal representatives,
successors and assigns. |
| 9. | Governing Law. This Exercise Agreement will be construed and interpreted
in accordance with the laws of the State of Delaware without regard to conflict of law principles. |
| 10. | Severability. The invalidity or unenforceability of any provision
of this Exercise Agreement shall not affect the validity or enforceability of any other provision, and each provision of this Exercise
Agreement shall be severable and enforceable to the extent permitted by law. |
| 11. | Counterparts. This Exercise Agreement may be executed in counterparts,
each of which shall be deemed an original but all of which together will constitute one and the same instrument. |
| 12. | Notice. Any notice required to be delivered to the Company under
this Exercise Agreement shall be in writing and addressed to the Secretary of the Company at the Company’s principal corporate offices.
Any notice required to be delivered to the Purchaser under this Exercise Agreement shall be in writing and addressed to the Purchaser
at the Purchaser’s address as set forth above. Either party may designate another address in writing (or by such other method approved
by the Company) from time to time. |
| 13. | Acknowledgement. The Purchaser understands that he or she is purchasing
the Shares pursuant to the terms and conditions of the Plan and the Stock Option Agreement, copies of which the Purchaser has read and
understands. |
IN WITNESS WHEREOF, the parties have executed
this Exercise Agreement as of the date first above written.
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COMPANY: |
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Signing Day Sports, Inc. |
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By: |
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Name: |
David Wolfson |
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Title: |
Chief Financial Officer |
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PURCHASER: |
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[Name] |
Exhibit 12
THIS
INSTRUMENT AND ANY SECURITIES ISSUABLE PURSUANT HERETO HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR UNDER THE SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED,
PLEDGED OR HYPOTHECATED EXCEPT AS PERMITTED IN THIS SAFE AND UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT OR AN EXEMPTION THEREFROM.
SIGNING DAY SPORTS,
LLC
SAFE
(Simple Agreement for Future Equity)
THIS CERTIFIES THAT in exchange
for the payment by Nelson Revocable Living Trust (the “Investor”) of $ 100,000.00
(the “Purchase Amount”) on or about April 23, 2021, Signing Day Sports, LLC, an Arizona limited liability company
(the “Company”), issues to the Investor the right to certain membership interests of the Company, subject to the terms
described below.
(a)
Equity Financing. If there is an Equity Financing before the termination of this Safe, on the initial closing of
such Equity Financing, this Safe will automatically convert into the number of Safe Preferred Interests equal to the Purchase Amount divided
by the Conversion Price Per Share.
In connection with the automatic
conversion of this Safe into Safe Preferred Interests, the Investor will execute and deliver to the Company all of the transaction documents
related to the Equity Financing; provided, that such documents (i) are the same documents to be entered into with the purchasers
of Standard Preferred Interests, with appropriate variations for the Safe Preferred Interests, if applicable, and (ii) have customary
provisions including (without limitation) limited representations, warranties, liability and indemnification obligations in favor of the
Investor.
(b)
Liquidity Event. If there is a Liquidity Event before the termination of this Safe, this Safe will automatically
be entitled (subject to the liquidation priority set forth in Section l(d) below) to receive a portion of Proceeds, due and payable to
the Investor immediately prior to, or concurrent with, the consummation of such Liquidity Event, equal to the greater of (i) the Purchase
Amount (the “Cash-Out Amount”) or (ii) an amount equal to a percentage of the Proceeds from the Liquidity Event with
such percentage calculated by dividing the Purchase Amount by Valuation Discount Price (the “Liquidity Event Amount”).
If any of the Company’s securityholders are given a choice as to the form and amount of Proceeds to be received in a Liquidity Event,
the Investor will be given the same choice, provided that the Investor may not choose to receive a form of consideration that the
Investor would be ineligible to receive as a result of the Investor’s failure to satisfy any requirement or limitation generally applicable
to the Company’s securityholders, or under any applicable laws. Notwithstanding the foregoing, in connection with a Change of Control
intended to qualify as a tax-free reorganization, the Company may reduce the cash portion of Proceeds payable to the Investor by the amount
determined by its board of directors in good faith for such Change of Control to qualify as a tax-free reorganization for U.S. federal
income tax purposes, provided that such reduction (A) does not reduce the total Proceeds payable to such Investor and (B) is applied in
the same manner and on a pro rata basis to all securityholders who have equal priority to the Investor under Section 1(d).
(c)
Dissolution Event. If there is a Dissolution Event before the termination of this Safe, the Investor will automatically
be entitled (subject to the liquidation priority set forth in Section 1(e) below) to receive a portion of Proceeds equal to the Cash-Out
Amount, due and payable to the Investor immediately prior to the consummation of the Dissolution Event.
(d)
Auto-Conversion. If after eighteen (18) months, there has been no Equity Financing, Liquidity Event, or Dissolution
Event where Investor has received Membership Interests in the Company or other payment as contemplated above, then this Safe will automatically
convert into the number of Common Membership Interests equal to the Purchase Amount divided by the Valuation Discount Price Per Share.
(e)
Liquidation Priority. In a Liquidity Event or Dissolution Event, this Safe is intended to operate like standard non-participating
preferred equity and will dilute payment to the holders of Common Membership Interests. The Investor’s right to receive its Cash-Out
Amount is:
(i)
Junior to payment of outstanding indebtedness and creditor claims, including contractual claims for payment and convertible promissory
notes (to the extent such convertible promissory notes are not actually or notionally converted into Membership Interests);
(ii)
On par with payments for other Safes and/or Preferred Membership Interests, and if the applicable Proceeds are insufficient to
permit full payments to the Investor and such other Safes and/or Preferred Membership Interests, the applicable Proceeds will be distributed
pro rata to the Investor and such other Safes and/or Preferred Membership Interests in proportion Membership Interests to the full payments
that would otherwise be due; and
(iii) Senior to payments for Common Membership Interests.
(e) Termination.
This Safe will automatically terminate (without relieving the Company of any obligations arising from a prior breach of or non-compliance
with this Safe) immediately following the earliest to occur of: (i) the issuance of Membership Interests to the Investor pursuant to the
automatic conversion of this Safe under Section 1(a); (ii) the payment, or setting aside for payment, of amounts due the Investor pursuant
to Section 1(b) or Section 1(c); or (iii) the conversion of this Safe under Section l(d).
“Change of Control”
means (i) a transaction or series ofrelated transactions in which any “person” or “group” (within the meaning
of Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended), becomes the “beneficial owner” (as defined
in Rule 13d-3 under the Securities Exchange Act of 1934, as amended), directly or indirectly, of more than 50% of the outstanding voting
securities of the Company having the right to vote for the election of members of the Company’s board of directors, (ii) any reorganization,
merger or consolidation of the Company, other than a transaction or series of related transactions in which the holders of the voting
securities of the Company outstanding immediately prior to such transaction or series of related transactions retain, immediately after
such transaction or series of related transactions, at least a majority of the total voting power represented by the outstanding voting
securities of the Company or such other surviving or resulting entity or (iii) a sale, lease or other disposition of all or substantially
all of the assets of the Company.
“Common Membership
Interests” means Membership Interests of the Company other than Preferred Membership Interests.
“Company Capitalization”
is calculated as of immediately prior to the the Auto-Conversion in Section l(d) and (without double-counting, in each case calculated
on an as-converted to Common Membership Interest basis (if applicable)):
| ● | Includes all shares of Membership Interests issued and outstanding; |
| ● | Includes all Converting Securities; |
| ● | Includes all (i) issued and outstanding Incentive Equity
and (ii) Promised Incentive Equity; and |
| ● | Includes the Unissued Option Pool, except that any increase
to the Unissued Option Pool in connection with the Equity Financing shall only be included to the extent that the number of Promised
Incentive Equity exceeds the Unissued Option Pool prior to such increase. |
“Conversion Price Per Share” means the Equity Financing
Price Per Share multiplied by the Discount Rate.
“Converting Securities”
includes convertible securities issued by the Company (other than Safes), including but not limited to: (i) convertible promissory notes
and other convertible debt instruments; and (ii) convertible securities that have the right to convert into Membership Interests.
“Direct Listing”
means the Company’s initial listing of its equity securities (other than equity securities not eligible for resale under Rule 144 under
the Securities Act) on a national securities exchange by means of an effective registration statement on Form S-1 filed by the Company
with the SEC that registers shares of existing equity securities of the Company for resale, as approved by the Company’s governing body.
For the avoidance of doubt, a Direct Listing shall not be deemed to be an underwritten offering and shall not involve any underwriting
services.
“Discount Rate” is eighty percent (80%) (i.e. a
twenty percent (20%) total discount).
“Dissolution Event”
means (i) a voluntary termination of operations, (ii) a general assignment for the benefit of the Company’s creditors or (iii) any other
liquidation, dissolution or winding up of the Company (excluding a Liquidity Event), whether voluntary or involuntary.
“Equity Financing”
means a bona fide transaction or series of transactions with the principal purpose of raising capital, pursuant to which the Company issues
and sells Preferred Membership Interests at a fixed valuation, including but not limited to, a pre-money or post-money valuation.
“Equity Financing
Price Per Share” means the price per share for Standard Preferred Interests as agreed upon by investors purchasing Standard
Preferred Interests in the applicable Equity Financing.
“Incentive Equity”
includes restricted “profits interests” awards, restricted membership interests awards, or purchases, RSUs, SARs, options
to purchase any of the foregoing, warrants or similar securities, vested or unvested.
“Initial Public
Offering” means the closing of the Company’s first firm commitment underwritten initial public offering of Company’s equity
securities pursuant to a registration statement filed under the Securities Act.
“Liquidity Event” means a Change of Control, a Direct
Listing or an Initial Public Offering.
“Membership Interests”
means the membership interests of the Company, including, without limitation, the “Common
Membership Interests” and the “Preferred Membership Interests.”
“Preferred Membership Interests” means Membership
Interests issued to investors in an Equity Financing.
“Proceeds”
means cash and other assets (including without limitation stock or equity consideration) that are proceeds from the Liquidity Event or
the Dissolution Event, as applicable, and legally available for distribution.
“Promised Incentive
Equity” means promised but ungranted Incentive Equity that are the greater of those (i) promised pursuant to agreements or understandings
made prior to the execution of, or in connection with, the term sheet or letter of intent for the Equity Financing or Liquidity Event,
as applicable (or the initial closing of the Equity Financing or consummation of the Liquidity Event, if there is no term sheet or letter
of intent), (ii) in the case of an Equity Financing, treated as outstanding Incentive Equity in the calculation of the Standard Preferred
Interests price per share, or (iii) in the case of a Liquidity Event, treated as outstanding Incentive Equity in the calculation of the
distribution of the Proceeds.
“Safe”
means an instrument containing a future right to Membership Interests, similar in form and content to this instrument, purchased by investors
for the purpose of funding the Company’s business operations. References to “this Safe” mean this specific instrument.
“Safe Preferred
Interests” means the Preferred Membership Interests issued to the Investor in an Equity Financing, having the identical rights,
privileges, preferences and restrictions as the shares of Standard Preferred Interests, other than with respect to: (i) the per share
liquidation preference and the initial conversion price for purposes of price-based anti-dilution protection, which will equal the Conversion
Price; and (ii) the basis for any dividend or distribution rights, which will be based on the Conversion Price.
“Standard Preferred
Interests” means the Preferred Membership Interests issued to the investors investing new money in the Company in connection
with the initial closing of the Equity Financing.
“Unissued Option
Pool” means all shares of Membership Interests that are reserved, available for future grant and not subject to any outstanding
Incentive Equity or Promised Incentive Equity (but in the case of a Liquidity Event, only to the extent Proceeds are payable on such
Promised Incentive Equity) under any equity incentive or similar Company plan.
“Valuation” means $100,000,000.
“Valuation Discount” means twenty percent (20%).
“Valuation Discount Price” means the Valuation multiplied
by the Valuation Discount.
“Valuation Discount
Price Per Share” means the price per share for Common Membership Interests determined by dividing the total Company Capitalization
by the Valuation then multiplied by the Valuation Discount..
| 3. | Company Representations |
(a)
The Company is a limited liability company, duly organized, validly existing and in good standing under the laws of its state of
formation, and has the power and authority to own, lease and operate its properties and carry on its business as now conducted.
(b)
The execution, delivery and performance by the Company of this Safe is within the power of the Company and has been duly authorized
by all necessary actions on the part of the Company (subject to section 3(d)). This Safe constitutes a legal, valid and binding obligation
of the Company, enforceable against the Company in accordance with its terms, except as limited by bankruptcy, insolvency or other laws
of general application relating to or affecting the enforcement of creditors’ rights generally and general principles of equity. To its
knowledge, the Company is not in violation of (i) its current certificate of incorporation or bylaws, (ii) any material statute, rule
or regulation applicable to the Company or (iii) any material debt or contract to which the Company is a party or by which it is bound,
where, in each case, such violation or default, individually, or together with all such violations or defaults, could reasonably be expected
to have a material adverse effect on the Company.
(c) The performance and consummation of the
transactions contemplated by this Safe do not and will not: (i) violate any material judgment, statute, rule or regulation
applicable to the Company; (ii) result in the acceleration of any material debt or contract to which the Company is a party or by
which it is bound; or (iii) result in the creation or imposition of any lien on any property, asset or revenue of the Company or the
suspension, forfeiture, or nonrenewal of any material permit, license or authorization applicable to the Company, its business or
operations.
(d)
No consents or approvals are required in connection with the performance of this Safe, other than: (i) the Company’s corporate
approvals; (ii) any qualifications or filings under applicable securities laws; and (iii) necessary corporate approvals for the authorization
of Membership Interests issuable pursuant to Section I.
(e)
To its knowledge, the Company owns or possesses (or can obtain on commercially reasonable terms) sufficient legal rights to all
patents, trademarks, service marks, trade names, copyrights, trade secrets, licenses, information, processes and other intellectual property
rights necessary for its business as now conducted and as currently proposed to be conducted, without any conflict with, or infringement
of the rights of, others.
| 4. | Investor Representations |
(a)
The Investor has full legal capacity, power and authority to execute and deliver this Safe and to perform its obligations hereunder.
This Safe constitutes valid and binding obligation of the Investor, enforceable in accordance with its terms, except as limited by bankruptcy,
insolvency or other laws of general application relating to or affecting the enforcement of creditors’ rights generally and general principles
of equity.
(b) The Investor is an
accredited investor as such term is defined in Rule 501 of Regulation D under the Securities Act, and acknowledges and agrees that
if not an accredited investor at the time of an Equity Financing, the Company may void this Safe and return the Purchase Amount. The
Investor has been advised that this Safe and the underlying securities have not been registered under the Securities Act, or any
state securities laws and, therefore, cannot be resold unless they are registered under the Securities Act and applicable state
securities laws or unless an exemption from such registration requirements is available. The Investor is purchasing this Safe and
the securities to be acquired by the Investor hereunder for its own account for investment, not as a nominee or agent, and not with
a view to, or for resale in connection with, the distribution thereof, and the Investor has no present intention of selling,
granting any participation in, or otherwise distributing the same. The Investor has such knowledge and experience in financial and
business matters that the Investor is capable of evaluating the merits and risks of such investment, is able to incur a complete
loss of such investment without impairing the Investor’s financial condition and is able to bear the economic risk of such
investment for an indefinite period of time.
(a) Any
provision of this Safe may be amended, waived or modified by written consent of the Company and either (i) the Investor or (ii) the majority-in-interest
of all then-outstanding Safes executed within a ninety (90) day period as this Safe, provided that with respect to clause (ii):
(A) the Purchase Amount may not be amended, waived or modified in this manner, (B) the consent of the Investor and each holder of such
Safes must be solicited (even if not obtained), and (C) such amendment, waiver or modification treats all such holders in the same manner.
“Majority-in-interest” refers to the holders of the applicable group of Safes whose Safes have a total Purchase Amount greater
than 50% of the total Purchase Amount of all of such applicable group of Safes.
(b)
Any notice required or permitted by this Safe will be deemed sufficient when delivered personally or by overnight courier or sent
by email to the relevant address listed on the signature page, or 48 hours after being deposited in the U.S. mail as certified or registered
mail with postage prepaid, addressed to the party to be notified at such party’s address listed on the signature page, as subsequently
modified by written notice.
(c)
The Investor is not entitled, as a holder of this Safe, to vote or be deemed a holder of Membership Interests for any purpose other
than tax purposes, nor will anything in this Safe be construed to confer on the Investor, as such, any rights of a Company member or rights
to vote for the election of directors or managers or on any matter submitted to Company members, or to give or withhold consent to any
corporate action or to receive notice of meetings, until Membership Interests have been issued on the terms described in Section 1. Furthermore,
the Investor is not entitled to the payment of any dividends or distributions until a conversion into Membership Interests; provided;
however, this restriction shall not be deemed to prohibit payments under Sections 1(b) and 1(c) above.
(d)
Neither this Safe nor the rights in this Safe are transferable or assignable, by operation of law or otherwise, by either party
without the prior written consent of the other; provided, however, that this Safe and/or its rights may be assigned without
the Company’s consent by the Investor (i) to the Investor’s estate, heirs, executors, administrators, guardians and/or successors in the
event of lnvestor’s death or disability, or (ii) to any other entity who directly or indirectly, controls, is controlled by or is under
common control with the Investor, including, without limitation, any general partner, managing member, officer or director of the Investor,
or any venture capital fund now or hereafter existing which is controlled by one or more general partners or managing members of, or shares
the same management company with, the Investor; and provided, further, that the Company may assign this Safe in whole, without
the consent of the Investor, in connection with a reincorporation to change the Company’s domicile.
(e)
In the event any one or more of the provisions of this Safe is for any reason held to be invalid, illegal or unenforceable, in
whole or in part or in any respect, or in the event that any one or more of the provisions of this Safe operate or would prospectively
operate to invalidate this Safe, then and in any such event, such provision(s) only will be deemed null and void and will not affect any
other provision of this Safe and the remaining provisions of this Safe will remain operative and in full force and effect and will not
be affected, prejudiced, or disturbed thereby.
(f) All rights and obligations hereunder will be governed by the laws of the State of Delaware, without regard to the conflicts of
law provisions of such jurisdiction.
(g) The parties
acknowledge and agree that for United States federal and state income tax purposes this Safe is, and at all times has been, intended
to be characterized as membership interests in a partnership, of the Internal Revenue Code of 1986, as amended. Accordingly, the
parties agree to treat this Safe consistent with the foregoing intent for all United States federal and state income tax purposes
(including, without limitation, on their respective tax returns or other informational statements).
(h)
Investor acknowledges that the Company may convert to a corporation after the execution of this Safe and prior to the conversion
of this Safe (“Corporate Reorganization”). If the Company engages in a Corporate Reorganization, the
terms of this Safe shall continue to apply and the Company may replace this Safe with a replacement Safe on terms substantially similar
to the terms of this Safe without the prior consent of Investor. Alternatively, the governing body of the Company may apply the terms
of this Safe after such Corporate Reorganization in the good faith and reasonable discretion of the Company’s governing body.
(Signature page follows)
IN WITNESS WHEREOF, the undersigned have caused this Safe to be duly
executed and delivered.
| |
SIGNING DAY SPORTS, LLC, an Arizona limited liability company |
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|
|
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By: |
/s/ Andrew Lampe |
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Name: |
Andrew Lampe |
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Title: |
COO |
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Address: |
[Redacted] |
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|
|
| |
|
| |
|
|
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Email: |
[Redacted] |
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|
|
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INVESTOR: |
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|
|
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By: |
/s/ Daniel D. Nelson |
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Name: |
Nelson Revocable Living Trust |
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Title: |
Trustee |
| |
Address: |
[Redacted] |
| |
Email: |
[Redacted] |
Exhibit 13
CANCELLATION AND EXCHANGE
AGREEMENT
THIS CANCELLATION
AGREEMENT (this “Agreement”) is made and entered into as of September 22, 2022 (the “Effective
Date”), by and among Signing Day Sports, Inc., a Delaware corporation (the “Company”), and the
undersigned holder of the SAFE (as defined below) set forth on the signature page (the “Holder” and, together
with the Company, the “Parties”).
RECITALS
A. The
Holder is the record and beneficial owner of the SAFE identified on the signature page of this Agreement (the “SAFE”).
B. The
Parties desire to cancel the SAFE and in consideration therefor the Company desires to issue to the Holder the number of shares of common
stock, $0.000 l par value per share, of the Company (the “Cancellation Shares”) set forth on the signature page
hereto.
C. The Holder desires to accept such Cancellation Shares in exchange for the SAFE.
AGREEMENT
NOW THEREFORE,
in consideration of the mutual covenants and agreements contained herein and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the undersigned do hereby agree as follows:
1. Holder
hereby agrees to surrender the SAFE to the Company free and clear of all claims, charges, liens, contracts, rights, options, security
interests, mortgages, encumbrances and restrictions of every kind and nature (collectively, “Claims”) in exchange
for the Cancellation Shares. After such cancellation, Holder acknowledges and agrees that all such SAFE shall no longer be outstanding,
and Holder shall have no further rights with respect to (a) any of the SAFE, (b) the equity ownership in the Company represented thereby,
or (c) rights under any pro rata agreement or side letter granting a preemptive or similar right or (d) the acquisition of any additional
equity interest in the Company.
2. Holder
hereby represents and warrants that Holder owns the SAFE beneficially and of record, free and clear of all Claims. Holder has never transferred
or agreed to transfer the SAFE, other than pursuant to this Agreement. There is no restriction affecting the ability of Holder to transfer
the legal and beneficial title and ownership of the SAFE to the Company for cancellation. Neither the execution and delivery of this Agreement,
the consummation of the transactions contemplated hereby, nor the performance of this Agreement in compliance with its terms and conditions
by Holder will conflict with or result in any violation of any agreement, judgment, decree, order, statute or regulation applicable to
Holder, or any breach of any agreement to which Holder is a party, or constitute a default thereunder, or result in the creation of any
Claim of any kind or nature on, or with respect to Holder or Holder’s assets, including, without limitation, Holder’s equity interests
in the Company.
3. The
Cancellation Shares are being acquired by the Holder for its account, for investment purposes and not with a view to the sale or distribution
of all or any part of the Cancellation Shares, nor with any present intention to sell or in any way distribute the same, as those terms
are used in the Securities Act of 1933, as amended (the “Act”), and the rules and regulations promulgated
thereunder. The Holder has sufficient knowledge and experience in financial matters so as to be capable of evaluating the merits and
risks of acquiring the Cancellation Shares hereunder. The Holder has reviewed copies of such documents and other information as the Holder
has deemed necessary in order to make an informed investment decision with respect to its acquisition of the Cancellation Shares. The
Holder understands that the Cancellation Shares may not be sold, transferred or otherwise disposed of without
registration under the Act or the availability of an exemption therefrom, and that in the absence of an effective registration statement
covering the Cancellation Shares or an available exemption from registration under the Act, the Cancellation Shares must be held indefinitely.
Further, the Holder understands and has the financial capability of assuming the economic risk of an investment in the Cancellation Shares
for an indefinite period of time. The Holder has been advised by the Company that the Holder will not be able to dispose of the Cancellation
Shares, or any interest therein, without first complying with the relevant provisions of the Act and any applicable state securities
laws. The Holder understands that the provisions of Rule 144 promulgated under the Act, permitting the routine sales of the securities
of certain issuers subject to the terms and conditions thereof, are not currently, and may not hereafter be, available with respect to
the Cancellation Shares. The Holder acknowledges that the Company is under no obligation to register the Cancellation Shares or to furnish
any information or take any other action to assist the undersigned in complying with the terms and conditions of any exemption which
might be available under the Act or any state securities laws with respect to sales of the Cancellation Shares in the future. The Holder
is an “Accredited Investor” as defined in rule 501 (a) of Regulation D of the Act.
4. At
the request of the Company and without further consideration, Holder will execute and deliver such other instruments of sale, transfer,
conveyance, assignment and confirmation as may be reasonably requested in order to effectively transfer, convey and assign to the Company
for cancellation of the SAFE.
5. This
Agreement is a binding agreement and constitutes the entire agreement between the Parties with respect to the subject matter hereof.
6. This
Agreement is binding upon and inures to the benefit of the successors and assigns of the Parties hereto.
7. This
Agreement shall be governed by and construed under the laws of the State of Delaware without regard to principles of conflicts of law.
8. This
Agreement may be executed in identical counterparts. Each counterpart hereof shall be deemed to be an original instrument, but all counterparts
hereof taken together shall constitute a single document. Facsimile, emailed PDFs and electronic signatures shall be deemed originals.
9. The
Parties hereto agree to use their reasonable best efforts to cooperate with one another to discharge their respective obligations under
this Agreement and to satisfy the intents and purposes of this Agreement.
[Signature page follows]
IN
WITNESS WHEREOF, the Parties have executed this Note Cancellation Agreement as of the date first above written.
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COMPANY: |
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|
|
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SIGNING DAY SPORTS, INC. |
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|
|
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By: |
/s/ Dennis Gile |
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Name: |
Dennis Gile |
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Title: |
President |
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|
|
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HOLDER: |
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|
|
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Nelson Revocable Living Trust |
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Print Name Above |
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|
|
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/s/ Daniel D. Nelson |
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Sign Above |
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|
|
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lf signer is an entity, specify name and
title of authorized
signer below: |
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|
|
| |
Name: |
Daniel Nelson |
| |
Title: |
Trustee |
| SAFE Date | |
SAFE Investment Amount | | |
Number
of Cancellation Shares to be Received
(SAFE
Investment Amount Divided by $[*], which is based upon a $25 million valuation for the Company) | |
| 4/23/2021 | |
| 100,000 | | |
| 149,254 | |
3
Exhibit 14
Exhibit E
Form of Note
NEITHER THIS NOTE NOR THE
SECURITIES INTO WHICH THIS NOTE IS CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES
COMMISSION OF ANY STATE. THESE SECURITIES HAVE BEEN SOLD IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES
LAWS.
SIGNING DAY SPORTS, INC.
CONVERTIBLE
NOTE
| Issuance
Date: 10/15, 2021 |
Original
Principal Amount: $1,500,000 |
| Note
No. 1 |
|
FOR
VALUE RECEIVED, Signing Day Sports, Inc., a Delaware corporation (“Signing Day Sports”) or the
“Maker”), hereby promises to pay to the order of Nelson Revocable Living Trust (the
“Subscriber”), or registered assigns (together with the Subscriber, the “Holder”) the
amount set out above as the Original Principal Amount, as reduced pursuant to the terms hereof pursuant to redemption, conversion or
otherwise (the “Principal”), when due, whether upon the Maturity Date (as defined below), acceleration,
redemption or otherwise (in each case in accordance with the terms hereof) and to pay interest (“Interest”) on
any outstanding Principal at the applicable Interest Rate from the date set out above as the Issuance Date (the “Issuance
Date”) until the same becomes due and payable, upon the Maturity Date or acceleration, conversion, redemption or otherwise
(in each case in accordance with the terms hereof).
The Original Principal
Amount is One Million Five-Hundred Thousand Dollars ($1,500,000). For purposes hereof, the term “Outstanding
Balance” means the Original Principal Amount, as reduced or increased, as the case may be, pursuant to the terms hereof
for conversion, breach hereof or otherwise, plus any accrued but unpaid interest, collection and enforcements costs, and any other
fees or charges incurred under this Note provided that, in the event of an optional or mandatory conversion of the
Note into shares of Common Stock (as provided herein), all accrued interest on the Principal subject to such conversion shall be
waived.
This Note is being issued
pursuant to the terms of a subscription agreement dated as of 10/15, 2021 between the Maker and the Subscriber and exhibits
thereto (collectively, the “Transaction Documents”). Unless otherwise defined herein, all capitalized terms, when
used in this Note, shall have the same meaning as they are defined in the Transaction Documents.
1. GENERAL TERMS
(a) Payment of
Principal. Unless previously converted into shares of the common stock, $0. _______ par value, of Signing Day Sports or the
common stock of any successor in interest to the Maker (each the “Common Stock” as contemplated hereby, this
Note, together with all accrued interest hereon at the Interest Rate, shall be due and payable on [September _______, 2024] (the
“Maturity Date”). In the event that by the Maturity Date, the Maker shall not have consummated an initial public
offering of its Common Stock and the listing or trading of its Common Stock on a “Qualified Securities Market”,
as defined below (the “IPO”) or other “Liquidity Event” (hereinafter defined), the Maker may
elect (a) up on thirty (30) days prior written notice to the Holder, elect to prepay all or a portion of the principal amount of the
Note and accrued interest hereon, subject to the Holder’s right to convert the Note into Common Stock during such thirty (30)
day period, or period, or (b) if the Maker does not prepay the entire principal amount of the Note or the remaining principal amount
of the Note, this Note will automatically increase to 110% of the original or unpaid portion of the outstanding principal
amount.
(b) Interest. Interest shall accrue from the Issuance Date on the Original Principal Amount or other outstanding Principal at an annual rate of six percent (6%) (the “Interest Rate”) and all accrued interest shall be fully paid on the Maturity Date (or sooner as provided herein) to the Holder or its assignee in whose name this Note is registered on the records of the Maker regarding registration and transfers of Notes in cash. However, in the event of an optional or mandatory conversion of the Note into shares of Common Stock (as provided herein), all accrued interest on the Principal subject to such conversion shall be waived.
2. EVENTS OF DEFAULT.
Whenever
used herein, an “Event
of Default” means the occurrence and continuation of any one of the following events, whatever the reason, and
whether it shall be voluntary or involuntary, or effected by operation of law or pursuant to any judgment, decree or order of any court,
or any order, rule or regulation of any administrative or governmental body:
(a)
The Maker’s failure to pay to the Holder any amount of Principal, Interest, or other amounts
when and as due under this Note; or
(b) A Conversion Failure as defined in Section 3(d)(ii); or
(c)
A material breach by Signing Day Sports of any material representation, warranty or covenant contained in the Signing Day Sports
Purchase Agreement or a material breach by Signing Day Sports of any material representation, warranty or covenant contained in the Purchase
Agreement, that, if capable of cure, is not cured within 30 days from the date such breach has occurred; or
(d)
The Maker or any subsidiary of the Maker shall commence, or there shall be commenced against the Maker or any subsidiary of the
Maker under any applicable bankruptcy or insolvency laws as now or hereafter in effect or any successor thereto, or the Maker or any subsidiary
of the Maker commences any other proceeding under any reorganization, arrangement, adjustment of debt, relief of debtors, dissolution,
insolvency or liquidation or similar law of any jurisdiction whether now or hereafter in effect relating to the Maker or any subsidiary
of the Maker or there is commenced against the Maker or any subsidiary of the Maker any such bankruptcy, insolvency or other proceeding
which remains undismissed for a period of ninety-one (91) days; or the Maker or any subsidiary of the Maker is adjudicated insolvent or
bankrupt; or any order of relief or other order approving any such case or proceeding is entered; or the Maker or any subsidiary of the
Maker suffers any appointment of any custodian, private or court appointed receiver or the like for it or any substantial part of its
property which continues undischarged or unstayed for a period of ninety-one (91) days; or the Maker or any subsidiary of the Maker makes
a general assignment for the benefit of creditors; or the Maker or any subsidiary of the Maker shall fail to pay, or shall state that
it is unable to pay, or shall be unable to pay, its debts generally as they become due; or the Maker or any subsidiary of the Maker shall
call a meeting of its creditors with a view to arranging a composition, adjustment or restructuring of its debts; or the Maker or any
subsidiary of the Maker shall by any act or failure to act expressly indicate its consent to, approval of or acquiescence in any of the
foregoing; or any corporate or other action is taken by the Maker or any subsidiary of the Maker for the purpose of effecting any of the
foregoing.
3.
CONVERSION OF NOTE. This Note shall be convertible into shares of Common Stock, on the terms and conditions set forth in this Section
3.
(a)
Certain Definitions. As used in this Note, the following capitalized terms shall have the meaning set forth below:
(i) “Alternative
Liquidity Event” shall mean any one of a Sale of Control, a SPAC Acquisition, or a Reverse Merger.
(ii)
“Alternative Liquidity Event Conversion Price” shall mean a conversion price that is equal to 60% of the
aggregate “Transaction Consideration” (as defined) divided by the total number of outstanding shares of common stock of
the acquiror resulting from a Sale of Control, the merger with a SPAC or the successor in interest “Pubco” (as defined)
in connection with Reverse Merger.
(iii)
“Common Stock” shall mean, as applicable the individual or collective reference to the common stock, $0.0001 par
value per share, of the Maker or the common stock of any acquiror in a Sale of Control, SPAC or Pubco resulting from a Sale of
Control, SPAC Acquisition or Reverse Merger.
(iv)
“Conversion Shares” shall mean the aggregate number of shares Common Stock of the Maker, the Acquiror in a Sale
of Control the SPAC or Pubco, as applicable (each an “Issuer”) that are issuable to the Holder in connection with any
mandatory conversion (set forth in Section 3(b)) or optional conversion (set forth in Section 3(c)) of this Note.
(v) “IPO” shall mean an initial public offering of Common Stock of the Maker pursuant to a registration statement on Form S-1 that is declared effective by the Securities and Exchange Commission.
(vi) “IPO Conversion Price” shall mean a conversion price equal to 60% of the initial public offering price per share of the Common Stock offered to the public in the IPO.
(vii) “Liquidity
Event” shall mean any one of an IPO, a Sale of Control, a SPAC Acquisition or a Reverse Merger.
(viii) “Optional Conversion Price” shall mean a conversion price that is equal to the price per share determined by dividing $50 million by the total number of outstanding shares of Common Stock of the Maker.
(ix) “Pre-MoneyValuation” shall mean the dollar value placed on the toatal number of outstanding shares of Common Stock of the Company immediately prior to a Liquidity Event.
(x) “Pubco”
means a fully-reporting public corporation under the Securities Exchange Act of 1934, as amended, that does not have any significant
business activities and is trading on Nasdaq or the OTCQX platform of the OTC Market.
(xi) “Qualified
Securities Market” shall mean any one of the Nasdaq Stock Exchange (including the Nasdaq Capital Market), the NYSE:Amex Exchange,
the New York Stock Exchange or the OTCQX platform of the OTC Markets.
(xii) “Reverse
Merger” means a merger of the Maker with or the acquisition of the Maker by Pubco, as a result of which such transaction, the
stockholders of the Maker will own a substantial majority of the equity securities of Pubco.
(xiii)
“Sale of Control” shall mean a sale of all or substantially as of the captial stock or assets of the Company to
any unaffiliated third Person, whether through share sale, asset sale, merger, consolidation or like combination, as a result of
which the ability to control the board of directors of the Company shall pass to such third Person.
(xiv)
“SPAC” means a special purpose acquisition corporation whose securities are listed on Nasdaq or the New York Stock
Exchange.
(xv)
“SPAC Acquisition” means a merger of the Maker with or the acquisition of the Maker by a SPAC or its subsidiary, as
a result of which such transaction, the stockholders of the Maker will own a majority of the equity securities of the SPAC.
(xvi) “Transaction
Consideration” shall mean the dollar value placed on the total consideration paid to the Company including, but not limited
to, (i) the value of the Transaction, including consideration whether in cash, stock or in-kind, received by and/or paid by the Company,
(ii) the total amount of indebtedness for borrowed funds, capitalized lease obligations and non-trade liabilities of the Company that
are either assumed by the acquirer, redeemed or otherwise satisfied in connection with the transaction, or which remain outstanding after
the transaction is consummated; (iii) the fair market value of any assets excluded from the transaction; (iv) the fair market value of
any ownership interests which are retained by the Company’s shareholders or which remain outstanding after the transaction is consummated;
and (v) the amount of any contingent payments, including, without limitation, earn-outs and future royalties payable in connection with
the transaction.
(b) Mandatory Conversion.
In the event that prior to the Maturity Date of this Note, the Maker shall consummate an IPO and its Common Stock shall be approved for
listing or trading on any Qualified Securities Market, the entire Outstanding Balance of this Note shall automatically,
and without any further consent or approval of the Holder, be converted into Common Stock of the Maker at the IPO Conversion Price. In
the event that prior to the Maturity Date, the Maker shall consummate an Alternative Liquidity Event, the Holder may elect at his or
its option to convert the outstanding and unpaid Outstanding Balance of this Note into Common Stock of the Maker at the Alternative Liquidity
Event Conversion Price. The IPO Conversion Price and the Alternative Liquidity Event Conversion Price (either, the “Mandatory
Conversion Price”) shall be subject to adjustment, as provided for in Section 3(f) below.
(c) Optional
Conversion. At any time, at the Holder’s option, such Holder may convert the outstanding and
unpaid Outstanding Balance of this Note into fully paid and nonassessable shares of Common Stock in accordance with this Section 3(c),
at the Optional Conversion Price, subject to adjustment as provided in Section 3(f) below. If the issuance would result in the
issuance of a fraction of a share of Common Stock, Signing Day Sports shall round such fraction of a share of Common Stock up to the nearest
whole share. Signing Day Sports shall pay any and all transfer agent fees, legal fees, costs and any other fees or costs that may be incurred
or charged in connection with the issuance and legend removal of shares of Common Stock to the Holder arising out of or relating to the
conversion of this Note up to a maximum of five thousand dollars ($5,000).
(d) Mechanics of Conversion.
(i) Optional
Conversion. To convert the Note pursuant to an optional conversion into shares of Common Stoke on any date (a “Conversion
Date”), the Holder shall (A) transmit by email, facsimile (or otherwise deliver), for receipt on or prior to 11:59 p.m.,
New York, NY Time, a copy of an executed notice of conversion in the form attached hereto as Exhibit A ( the “Conversion Notice”)
to Signing Day Sports, On or before the tenth (10th) Business Day following the date of receipt of a Conversion Notice (the
“Share Delivery Date”) Signing Day Sports shall (A) if legends are not required to be placed on certificates of Common
Stock pursuant to the then existing provisions of Rule 144 of the Securities Act of 1933 (“Rule 144”) and provided
that the Transfer Agent is participating in the Depository Trust Company (“DTC”) Fast Automated Securities Transfer
Program, credit such aggregate number of shares of Common Stock to which the Holder shall be entitled to the Holder’s or its designee’s
balance account with DTC through its Deposit Withdrawal Agent Commission system or (B) if the Transfer Agent is not participating in
the DTC Fast Automated Securities Transfer Program, issue and deliver to the address as specified in the Conversion Notice, a certificate,
registered in the name of the Holder or its designee, for the number of shares of Common Stock to which the Holder shall be entitled
which certificates shall not bear any restrictive legends unless required pursuant the Rule 144. The Person or Persons entitled to receive
the shares of Common Stock issuable upon a conversion of this Note shall be treated for all purposes as the record holder or holders
of such shares of Common Stock upon the transmission of a Conversion Notice.
(ii) lssuer’s
Failure to Timely Convert. If within ten (10) business days after a Liquidity Event or (in the case of an optional conversion)
Signing Day Sports receipt of the facsimile or email copy of a Conversion Notice together with documentation satisfactory to the
Transfer Agent that the Conversion Shares are eligible for such electronic issuance, the Issuer shall fail to issue and deliver to
Holder via “DWAC/FAST” electronic transfer the number of Conversion Shares to which the Holder is entitled upon such
holder’s conversion of any Conversion Shares (a “Conversion Failure”), the Outstanding Balance of the Note shall
increase by 0.05% per day until such time as the Issuer of the Conversion Shares issues and delivers a certificate to the Holder or
credit the Holder’s balance account with DTC for the number of Conversion Shares to which the Holder is entitled upon such
mandatory or optional conversion. The Issuer of the Conversion Shares will not be subject to any penalties once its transfer agent
processes the shares to the DWAC system. If the issuer fails to deliver shares in accordance with the timeframe stated in this
Section, resulting in a Conversion Failure, the Holder, at any time prior to selling all of those Conversion Shares, may rescind any
portion, in whole or in part, of that particular conversion attributable to the unsold shares and have the rescinded conversion
amount returned to the Outstanding Balance with the rescinded Conversion Shares returned to the applicable Issuer.
(iii) Book-Entry.
Notwithstanding anything to the contrary set forth herein, in connection with any optional or mandatory conversion of this Note in
accordance with the terms hereof, the Holder shall not be required to physically surrender this Note to Signing Day Sports unless
the issue of the Conversion Shares shall issue to the Holder of this Note either one or more stock certificates evidencing the
Conversion Shares or physical evidence from the Issuer’s transfer agent that the Holder’s balance account with DTC has
been credited for the number of Conversion Shares to which the Holder is entitled upon such mandatory or optional conversion. The
Holder and the Issuer shall maintain records showing the Outstanding Balance converted and the dates of such conversions or shall
use such other method, reasonably satisfactory to the Holder and Issuer, so as not to require physical surrender of this Note upon
conversion.
(e)
Limitations on Conversions or Trading.
If at any time
after the Closing, the Holder shall or would receive Conversion Shares or shall purchase additional shares of Common Stock of an
Issuer, so that the Holder would, together with other shares of Common Stock held by it or its Affiliates, own or beneficially own
by virtue of such action or receipt of additional shares of Common Stock a number of shares exceeding 9.99% of the number of shares
of Common Stock outstanding on such date (the “Maximum Percentage”), the Issuer shall not be obligated and shall
not issue to the Holder Conversion Shares which would exceed the Maximum Percentage, but only until such time as the Maximum
Percentage would no longer be exceeded by any such receipt of shares of Common Stock by the Holder. Upon delivery of a written
notice to the applicable Issuer the Holder may from time to time increase (with such increase not effective until the sixty-first
(61st) day after delivery of such notice) or decrease the Maximum Percentage to any other percentage not in excess of 9.99% as
specified in such notice; provided that (i) any such increase in the Maximum Percentage will not be effective until the sixty-first
(61st) day after such notice is delivered to Signing Day Sports and (ii) any such increase or decrease will apply only to the Holder
and its Affiliates. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict
conformity with the terms of this Section 3(e) to the extent necessary to correct this paragraph (or any portion of this paragraph)
which may be defective or inconsistent with the intended beneficial ownership limitation contained in this Section 3(e) or to
make changes or supplements necessary or desirable to properly give effect to such limitation. The limitation contained in this
paragraph may not be waived and shall apply to a successor holder of the Note.
(f) Adjustment
of Conversion Price. In the event that a Liquidity Event prior to the _________, 2024 Maturity Date of this Note, in the event that the
Maker shall raise additional capital through a private placement of Common Stock or other securities that are convertible or
exercisable for Common Stock, in either case, at a price less than the Optional Conversion Price, then and in such event the
Conversion Price of the Notes shall be adjusted to reflect such lower amount.
(g)
Other Provisions.
(i) Share
Reservation. Signing Day Sports shall at all times reserve and keep available out of its authorized Common Stock a number of shares
equal to at least the full number of shares of Common Stock issuable upon conversion of all outstanding amounts under this Note.
(ii)
Prepayment. This Note may not be prepaid by Signing Day Sports until March 31, 2022. Thereafter, the Note may either be prepaid
by the Company in whole or in part without penalty, fees or premium upon not less than twenty (20) business days prior written notice
to the Holder (the “Prepayment Notice”) which shall set forth the date on which the Note shall be prepaid (the “Prepayment
Date”), subject to the Holder’s right to convert all or any portion of this Note into Conversion Shares
at the Optional Conversion Price prior to the Prepayment Date.
(iii) All calculations under this
Section 3 shall be rounded up to the nearest whole share.
(iv) Nothing herein shall
limit a Holder’s right to purse actual damages or declare an Event of Default pursuant to Section 2 herein for Signing Day
Sport’s failure to deliver certificates or credit entries representing shares of Common Stock upon conversion within the
period specified herein and such Holder shall have the right to pursue all remedies available to it at law or in equity including,
without limitation, a decree of specific performance and/or injunctive relief, in each case without the need to post a bond or
provide other security. The exercise of any such rights shall not prohibit the Holder from seeking to enforce damages pursuant to
any other Section hereof or under applicable law.
(v) The Maker
shall use its best efforts to assist the Holder to obtain a legal opinion for the removal of any restrict legend in connection with
any shares converted from this Note.
(vi) This Note is one of the Convertible
Notes issued on or about the date of this Note by the Maker in an aggregate principal amount of up to $7,500,000, the
“Notes”). Each of the Notes shall rank equally without preference or priority of any kind over one another, and
all payments and recoveries under the Notes payable on account of principal and interest on the Notes shall be paid and applied
ratably and proportionately on the balance of all outstanding Notes on the basis of their original principal amount.
4. REISSUANCE OF THIS NOTE.
Upon receipt by
the Maker of evidence reasonably satisfactory to the Maker of the loss, theft, destruction or mutilation of this Note, and, in the case
of loss, theft or destruction, of any indemnification undertaking by the Holder to the Maker in customary form and, in the case of mutilation,
upon surrender and cancellation of this Note, the Maker shall execute and deliver to the Holder a new Note representing the outstanding
Principal.
5. NOTICES.
Any notices, consents, waivers or other communications required or permitted to be given under the terms shall be handled according
to the Notice clause in the Subscription Agreement.
The addresses for such communications
shall be:
If to the Maker:
Signing Day Sports, Inc.
7272 E. Indian School Road Suite 101
Scottsdale, AZ 85251
Email:
If to the Holder:
6. APPLICABLE LAW AND VENUE. This Note shall be governed by and
construed in accordance with the laws of the State of Delaware, without giving effect to conflicts of laws thereof. Any action
brought by either party against the other concerning the transactions contemplated by this Agreement shall be brought only in the
state courts of Delaware or in the federal courts located in the city of Wilmington, in the State of Delaware. Both parties and the
individuals signing this Agreement agree to submit to the jurisdiction of such courts.
7.
WAIVER. Any waiver by the Holder of a breach of any provision of this Note shall not operate as or be construed to be a waiver
of any other breach of such provision or of any breach of any other provision of this Note. The failure of the Holder to insist upon strict
adherence to any term of this Note on one or more occasions shall not be considered a waiver or deprive that party of the right thereafter
to insist upon strict adherence to that term or any other term of this Note. Any waiver must be in writing.
8. MISCELLANEOUS
(a) Lawful
Money; Costs of Collection. All amounts payable hereunder are payable in lawful money of the United States. Signing Day Sports
agrees to pay all costs of collection when incurred, including reasonable attorneys’ fees and costs,whether or not a suit or
action is instituted to enforce this Note, including but not limited
to court costs, appraisal fees, the cost of searching records, obtaining title reports and title insurance and trustee’s
fees, to the extent permitted by applicable law.
(b)
No Offset; Holder in Due Course. All payments under this Note made by or on behalf of Signing Day Sports shall be made without
setoff or counterclaim and free and clear of, and without deduction or withholding for or on account of, any federal, state, or local
taxes. Signing Day Sports waives any right of offset it now has or may hereafter have against Agent or Holder and its successors and assigns
as to this Note (but retains any such rights as to any other prior or future transaction between these parties), and agrees to make the
payments called for hereunder in accordance with the terms hereof. The holder hereof and all successors thereof shall have all the rights
of a holder in due course as provided in the Delaware Uniform Commercial Code and other laws of the State of Delaware.
(c)
Waivers. Signing Day Sports and any endorsers, guarantors or sureties hereof severally waive presentment and demand for
payment, notice of intent to accelerate maturity, protest or notice of protest or nonpayment, bringing of suit and diligence in taking
any action to collect any sums owing hereunder or in proceeding against any of the rights and properties securing payment hereunder; expressly
agree that this Note, or any payment hereunder, may be extended from time to time; and consent to the acceptance of further security or
the release of any security for this Note, all without in any way affecting the liability of Signing Day Sports and any endorsers or guarantors
hereof. No extension of time for the payment of this Note, or any installment hereof, made by agreement by the holder hereof with any
person now or hereafter liable for the payment of this Note, shall affect the original liability under this Note of Signing Day Sports,
even if Signing Day Sports (or any entity comprising Signing Day Sports) is not a party to such agreement.
(d) Usury
Protection. The parties hereto intend to conform strictly to the applicable usury laws. In no event, regardless of any
provisions contained therein or in any other document executed or delivered in connection herewith, shall the holder hereof ever be
deemed to have contracted for or be entitled to receive, collect or apply as interest on this Note, any amount in excess of the
maximum amount permitted by applicable law (the”Maximum Rate”). In no event,whether by reason of demand for
payment, prepayment, acceleration of the maturity hereof or otherwise, shall the interest contracted for, charged or received by the
holder hereunder or otherwise exceed the Maximum Rate. If for any circumstance whatsoever interest would otherwise be payable to the
holder in excess of the maximum lawful amount, the interest payable to the holder shall be reduced automatically to the Maximum Rate
and any payment received in excess of such amount shall be applied to the outstanding principal balance of the Note.
(e)
Entire Agreement. This Note, the other Transaction Documents, and all other documents and instruments contemplated hereby
and thereby together constitute the entire agreement between and among the parties pertaining to the subject matter hereof. No supplement,
modification or amendment of this Note shall be binding unless executed in writing by the parties. No waiver shall be binding unless executed
in writing by the party making the waiver. No provision of this Note shall be interpreted for or against the drafting party.
(f) Fees
and Expenses. Signing Day Sports agrees to pay all costs and expenses incurred by Holder in connection with all amendments,
modifications and supplements to any of the Transaction Documents, including, without limitation, the costs and fees of
Holder’s legal counsel, any applicable title company fees, title insurance premiums, filing fees, escrow fees, reconveyance
fees, payoff demands and recording costs.
(g) Commercial
Purpose. Signing Day Sports agrees that no funds advanced under this Note shall be used for personal, family or household purposes,
and that all funds advanced hereunder shall be used solely for business, commercial, investment or other similar purposes.
(h) Successors
and Assigns. All the terms and provisions of this Note shall be binding upon and inure to the benefit of the parties to this Note
and their respective successors and assigns.
(i) Assignment.
Signing Day Sports may not, voluntarily or involuntarily, directly or indirectly, by operation of law or otherwise, sell, transfer, assign,
hypothecate, pledge or in any way alienate this Note or any right or interest in this Note (each a “Transfer”) without
Holder’s Prior written consent, which Holder may withhold in its sole and absolute discretion. Any consent by Holder to any Transfer
shall not constitute consent to any other Transfer. Holder may freely Transfer its interest, rights, or title in or to this Note or the
other Transaction Documents in Holder’s sole and absolute discretion.
(j)
Construction. Whenever used in this Note, the terms “including,” “include,” “includes”
and the like are not intended as terms of limitation, and, hence, shall be deemed to be followed by without limitation.”
(k) Severability.
If any provision of this Note, as applied to any party or to any circumstance, shall be found by a court of competent jurisdiction to
be void, invalid or unenforceable, the same shall in no way affect any other provision of this Note, the application of any such provision
in any other circumstance, or the validity or enforceability of this Note, and any provision which is found to be void, invalid or unenforceable
shall be curtailed and limited only to the extent necessary to bring such provision within the requirements of the law.
(l) Survival
of Terms. The terms and provisions of this Note shall survive the Maturity Date until full payment of all amounts due hereunder.
(m) Preferential
Payment. If at any time any payment made pursuant to this Note is deemed to have been a voidable preference, fraudulent conveyance
or other similar conveyance or preferential payment under any bankruptcy, insolvency or other debtor relief or similar law, then the obligation
to make such payment shall survive any cancellation or satisfaction of this Note or return of this Note to Signing Day Sports and shall
not be discharged or satisfied with any such payment or cancellation. Such payment shall instead remain a valid and binding obligation
enforceable in accordance with the terms of this Note and shall be immediately due and payable.
(n) Relief
From Stay. As an additional inducement to and material consideration for Holder agreeing to execute this this Note and the other
Transaction Documents, each Signing Day Sports agrees that in the event a Bankruptcy or Judicial Action (as hereinafter defined in
this Section 8(n)) is commenced which subjects Holder to any stay in the exercise of Holder’s rights and remedies under this
Note or the other Transaction Documents, including, but not limited to, the automatic stay imposed by Section 362 of the
United States Bankruptcy Code (individually and collectively, “Stay”), then Signing Day Sports irrevocably
consents and agrees that such Stay shall automatically be lifted and released against Holder, and Holder shall thereafter be entitled to
exercise all of its rights and remedies against Signing Day Sports that is or could be subject any Stay under this Note or the other
Transaction Documents. Nothing contained herein shall limit or prevent Holder from exercising all of its rights and remedies against
Signing Day that is not the subject any Stay under this Note or the other Transaction Documents. Signing Day Sports acknowledges
that it is knowingly, voluntarily, and intentionally waiving its rights to any Stay and agrees that the benefits provided to Signing
Day Sports under the terms of this Note are valuable consideration for such waiver. As used in this Section 8(n), the term
“Bankruptcy or Judicial Action” shall mean any voluntary or involuntary case filed by or against a Signing Day Sports
under the United States Bankruptcy Code, or any voluntary or involuntary petition in composition, readjustment, liquidation, or
dissolution, or any state and federal bankruptcy law action filed by or against a Signing Day Sports, any action where a Signing Day
Sports is adjudicated as bankrupt or insolvent, any action for dissolution of a Signing Day Sports, or any action in furtherance of
any of the foregoing, or any other action, case, or proceeding that has the effect of staying (or in which a stay is being obtained
against) the enforcement by Holder of its rights and remedies under the this Note or the other Transaction Documents.
Except
to enforce the terms of the Transaction Documents, Signing Day Sports shall not take any action and shall not fail to take any action
which such action or omission will or might tend to interfere with, delay, enjoin or otherwise prohibit the commencement, continuation
or completion of efforts by Holder to enforce its remedies under this Note or the other Transaction Documents, or applicable law. Without
limiting the generality of the foregoing and except to enforce the terms of the Transaction Documents, each Signing Day Sports waives
its, his, or her rights, if any, to seek or obtain a stay, injunction or other form of order prohibiting in any way any act necessary
or appropriate for the commencement or completion of Holder’s enforcement of its remedies under the this Note or the other Transaction
Documents, or applicable law (without limiting the generality of the foregoing, such waiver extends to such rights which may exist under
any statute or rule relating to bankruptcy cases, including, without limitation, 11 U.S.C. § 105, 11 U.S.C. § 301, 11 U.S.C.
§ 302, 11 U.S.C. § 303, 11 U.S.C. § 304, 11 U.S.C. § 362, 11 U.S.C. § 348, 11 U.S.C. § 706, 28 U.S.C. §
157, 28 U.S.C. § 158, Federal Rule of bankruptcy Procedure (“FRBP”) 3007, FRBP 3008, FRBP 3012, FRBP 8005, FRBP 9023,
FRBP 9024, or FRBP 9029).
9.
AMENDMENT AND WAIVER OF RIGHTS. This Note may be amended and the observance of any term hereof may be waived (either generally
or in a particular instance either retroactively or prospectively) only by a written instrument executed by the Maker and the Holder.
10. WAIYER OF RIGHT TO TRIAL BY JURY.
EACH PARTY
TO THIS NOTE HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION (1) ARISING UNDER THIS
NOTE, THE OTHER TRANSACTION DOCUMENTS, OR ANY OTHER INSTRUMENT, DOCUMENT, OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION THEREWITH,
OR (2) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO THIS NOTE
OR ANY OTHER INSTRUMENT, DOCUMENT, OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH, OR THE TRANSACTIONS RELATED HERETO OR THERETO,
IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES
AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY. THE PARTIES HERETO
HEREBY AGREE THAT THE PROVISIONS CONTAINED HEREIN HAVE BEEN FAIRLY NEGOTIATED ON AN ARM’S-LENGTH BASIS, WITH BOTH SIDES AGREEING TO THE
SAME KNOWINGLY AND BEING AFFORDED THE OPPORTUNITY TO HAVE THEIR RESPECTIVE LEGAL COUNSEL CONSENT TO THE MATTERS CONTAINED HEREIN. ANY
PARTY TO THIS NOTE MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY AND THE AGREEMENTS CONTAINED HEREIN REGARDING THE APPLICATION OF JUDICIAL
REFERENCE IN THE EVENT OF THE INVALIDITY OF SUCH JURY TRIAL WAIVER.
IN WITNESS WHEREOF, each of the Maker
has caused this Note to be duly executed by a duly authorized officer as of the date set forth above.
| |
SIGNING DAY SPORTS, INC. |
| |
|
|
| |
By: |
/s/ John Dorsey |
| |
Name: |
John Dorsey |
| |
Title: |
Chief Executive Officer |
Note No. [ ]
9
Exhibit
15
THE
SECURITIES TO BE ISSUED PURSUANT TO THIS AGREEMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (“SECURITIES
ACT”), OR ANY OTHER APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE OFFERED OR SOLD UNLESS REGISTERED THEREUNDER OR UNLESS AN EXEMPTION
FROM SUCH REGISTRATION IS AVAILABLE.
SUBSCRIPTION
AGREEMENT
Signing
Day Sports, Inc.
7272 E. Indian School Road
Suite 101
Scottsdale,
AZ 85251
Ladies and Gentlemen:
Subscription.
The undersigned (sometimes referred to herein as the “Investor”) hereby subscribes for and agree to purchase the
principal amount of the Notes (as defined below) of Signing Day Sports, Inc., a Delaware corporation, currently known as Signing Day
Sports, LLC (the “Company”) for the purchase price (the “Purchase Price”) set forth on the
signature page hereto, on the terms and conditions described herein and in Exhibits A, B, C and D hereto (collectively, the
“Offering Documents”). Terms not defined herein are as defined in the Offering Documents. The Company is seeing
to raise, through a private placement of the Notes pursuant to Rule 506(b) promulgated under the Securities Act of 1933, as amended,
raise a minimum of $1,000,000 (the “Minimum Offering Amount”) and a maximum of $7,500,000 (the “Maximum
Offering Amount”) in this Offering. Boustead and the Company, in their sole discretion, may accept subscriptions in excess of
the Maximum Offering Amount. The minimum amount of investment required from any one subscriber to participate in this Offering is
$200,000, however, the Company reserves the right, in its sole discretion, to accept subscriptions less than this amount. All
references to $ means United States dollars. The undersigned acknowledges that the Company has engaged Boustead Securities, LLC
(“Boustead”) as its exclusive placement agent
in connection with this offering.
1. Description of Securities; Description of Company and Risk Factors; Lock-Up.
| a. | Description
of Securities. The Company is offering (the “Offering” to the Investor in
the minimum subscription amount of $200,000, however, the Company reserves the right, in
its sole discretion, to accept subscriptions less than this amount, of
the Company’s 6% convertible unsecured promissory notes due three years from the date
of execution (the “Notes”). |
This
Offering is being conducted in advance of the Company’s intended initial public offering (“IPO”) of our
common stock, par value $0.0001 per share (the “Common Stock”), and listing our Common Stock for trading on the
Nasdaq Capital Market or other national securities exchange.
The
Notes issued herein may be converted at any time by the holders into Company Common Stock. In addition, in connection with an IPO,
the Notes will automatically (and without any action on the part of the holders) be converted into shares of Common
Stock of the Company at a conversion price (the “Conversion
Price”) equal to the 60% of the public offering price per share of the Common Stock offered to the public in the IPO. For the avoidance of doubt if, for example, the initial per share offering price in the IPO is $5.00 per share, the conversion
price would be $3.00 (60% of the $5.00 per share IPO price).
Under our engagement letter with Boustead,
originally entered into on August 9, 2021 (the “Engagement Letter”), Boustead has been engaged as our exclusive
financial advisor for the 18 month term of the Engagement Letter or 12 months from the date of the IPO. In addition,
Boustead has expressed its intent to enter into an Underwriting Agreement with the Company to act as the lead underwriter for the
proposed IPO on a “firm commitment” basis. There can be no assurance that we and Boustead will be able to agree on the
terms of such Underwriting Agreement or that our proposed IPO will be successfully consummated.
In
the event that an IPO is not consummated, if the Company (a) is acquired as a result of a “Sale of Control” (as
defined), (b) merges with a “SPAC” (as defined) or (c) consummates a “Reverse Merger” (as defined) (each, a
“Liquidity Event”) prior to the maturity date of the Notes, the Notes will be convertible at the option of the holders
into shares of common stock of any successor-in-interest to the Company at a price per share equal to 60% of the aggregate
“Transaction Consideration” (as defined), divided by the total number of outstanding shares of common stock of the
acquiror resulting from the Liquidity Event.
As
used herein, (i) the term “Sale of Control” shall mean a sale of all or substantially as of the capital stock or assets
of the Company to any unaffiliated third Person, whether through share sale, asset sale, merger, consolidation or like combination,
as a result of which the ability to control the board of directors of the Company shall pass to such third Person, (ii) the term
“SPAC” shall mean a special purpose acquisition corporation listed on Nasdaq or other national securities exchange, and
(iii) the term “Reverse Merger” shall mean a reverse merger of the Company with a fully-reporting public corporation
without any significant business activities, including a special purpose acquisition corporation or “SPAC,” that is then
trading on Nasdaq or the OTCQX platform of the OTC Market (“Pubco”; it being contemplated that in a transaction with a
SPAC or a Reverse Merger, the stockholders of the Company will own a substantial majority of the equity securities of the SPAC or
Pubco. As used herein, the term “Transaction Consideration” shall mean the dollar value placed on the total
consideration paid to the Company including, but not limited to, (i) the value of the Transaction, including consideration whether
in cash, stock or in-kind, received by and/or paid by the Company, (ii) the total amount of indebtedness for borrowed funds,
capitalized lease obligations and non-trade liabilities of the Company that are either assumed by the acquirer, redeemed or
otherwise satisfied in connection with the transaction, or which remain outstanding after the transaction is consummated; (iii) the
fair market value of any assets excluded from the transaction; (iv) the fair market value of any ownership interests which are
retained by the Company’s shareholders or which remain outstanding after the transaction is consummated; and (v) the amount of
any contingent payments, including, without limitation, earn-outs and future royalties payable in connection with the
transaction.
Within
30 business days following the consummation of the first to occur of an IPO, a Sale of Control or a Reverse Merger, as applicable,
the Company will file a registration statement on Form S-1 or Form S-3, as available (the “Resale Registration
Statement”) in order to register for resale all of the shares of Common Stock of the Company or common stock of any
successor-in-interest to the Company issued to all holders of the Notes upon automatic conversion of the Notes (the
“Conversion Shares”), and will use its bests efforts to cause such Resale Registration Statement to be declared
effective by the SEC within 90 business days from the date of its initial filing; provided, that such Conversion
Shares will continue to be subject to restrictions on resale for a period of six (6) months following completion of either the IPO,
Sale of Control or Reverse Merger, as applicable.
In the event a Liquidity Event is
not consummated within twelve (12) months of the Closing of the Offering, the Company may elect either to (a) repay the Notes in whole
or in part (subject to the conversion rights of the Holders), or (b) if the Company does not repay the Notes the unpaid principal amount
of the Notes will automatically increase to 110% of the outstanding principal amount.
In the event that the Company shall
elect to raise additional capital through a private placement of Common Stock or other securities that are convertible or exercisable
for a price less than (the “Optional Conversion Price”), then and in such event the Conversion Price of the Notes shall
be adjusted to reflect such lower amount. The “Optional Conversion Price” shall man a price or conversion price that is equal
to the price per share determined by dividing $50 million by the total number of outstanding shares of Common Stock of the Company.
Holders of the Notes will enter
into an Investor Rights Agreement and Lock-Up Agreement. The investor Rights Agreement will provide for typical “drag
along” and “tag along” rights and will permit the holders to participate in subsequent securities offerings,
including the IPO, in a percentage amount of such securities offering equal to 50% of the percentage invested by such Holder in the
Notes. For the avoidance of doubt, if a holder purchases $1,500,000 million of Notes, such holder has the right to invest in
subsequent offerings no less than $750,000 in the subsequent offerings, including the IPO.
The form of Note is attached as Exhibit E hereto and is part of the Offering Documents. In addition, holders
of the Notes will also enter into an Investor Rights and Lock-Up Agreement with the Company in the form of Exhibit F attached hereto which
shall contain customary “tag along” and “drag along” rights.
For
a more detailed description of the Notes see the Term Sheet attached as Exhibit A. The Notes and the shares of Common Stock
or common stock of a SPAC or Pubco (“Successor Common Stock”) into which the Notes are convertible are sometimes
referred to herein as the “Securities.” The above referenced IPO, SPAC acquisition or Reverse Merger is sometimes
hereinafter collectively referred to as a “Liquidity Event” and the Company Common Stock or Successor Common
Stock into which the Notes are convertible are sometimes collectively referred to herein as the “Conversion
Shares”). The Notes and the Conversion Shares are sometimes collectively referred to herein as the
“Securities.”
| b. | Risks Related to the Investment in the Securities. Investing in the Securities involves a high
degree of risk. Before investing, Investors should carefully consider the summary description of our business annexed hereto as Exhibit
B, the risks related to our business, as set forth in Exhibit C and the investor deck set forth in Exhibit D, together
with the other information contained in Offering Documents. |
| c. | Lock-Up. In connection with this
Offering, the Investor shall enter into an Investors Rights and Lock-up Agreement in the
form of Exhibit E, pursuant to which the Investor shall agree that from and after
the date hereof and until the 180th day after the first to occur of (i) consummation of an
IPO, (ii) consummation of a transaction with a SPAC or, (iii) consummation of another form
of Reverse Merger, as applicable (each, the “Lock-Up Trigger Date”), the
investor agrees not to sell, transfer or otherwise dispose of the Conversion Shares. |
2. Purchase.
| a. | I
hereby agree to tender to Sutter Securities Clearing, LLC (the “Escrow
Agent”),
by check or wire transfer of immediately available funds (to a bank account and related
wire instructions to be provided to me on my request) made payable to “Sutter Securities
Clearing, LLC, as Escrow Agent for Signing Day Sports, Inc.” for
the principal amount of the Note indicated on the signature page hereto, an executed copy
of this Subscription Agreement and an executed copy of my Investor Questionnaire attached
as Exhibit A hereto. Funds will be held in escrow, as set forth in more detail
below (the “Escrow Account”), pending the initial Closing. |
| b. | The Offering is for a minimum offering amount $1,000,000 (the
“Minimum Offering Amount”) and a maximum offering $7,5000,000 (the “Maximum Offering Amount”). All subscriptions
to purchase Notes will be held in a noninterest-bearing escrow account (the “Escrow Account”) maintained by the Escrow Agent.
The subscription will remain in the Escrow Account until subscriptions for the Minimum Offering Amount are raised and until the conversion
of the Company into a Delaware corporation is complete. Boustead and the Company, in their sole discretion, may accept subscriptions
in excess of the Maximum Offering Amount. |
| c. | This Offering will continue until the earlier of (a) the sale
of $7,500,000 Notes for $7,500,000 of gross proceeds (the Maximum Offering Amount) or (b) November 15, 2021 (the “Termination
Date”). Upon the earlier of a Closing (defined below) on my subscription or completion of the Offering, I will be notified
promptly by the Company as to whether my subscription has been accepted by the Company. |
3. Acceptance or Rejection of Subscription.
| a. | I understand and agree that the Company reserves the right to reject this subscription
for the Securities, in whole or in part, for any reason and at any time prior to the Closing (defined below) of my subscription. |
| b. | In the event the Company rejects this subscription, my subscription payment will
be promptly returned to me without interest or deduction and this Subscription Agreement shall be of no force or effect. In the event
my subscription is accepted and the Offering is completed, the subscription funds submitted by me shall be released to the Company. |
4. Closing.
The closing (“Closing”) of this Offering may occur at any time and from time to time on or before the Termination
Date. The Company must achieve the $1,000,000 Minimum Offering Amount prior to conducting an initial Closing (the “Initial Closing”).
Upon receipt of the Minimum Amount, provided the Company’s conversion to a Delaware corporation has been completed, an Initial
Closing will be held and all funds will be released from the Escrow Account and paid to the Company, less professional fees and compensation
paid to the Placement Agent and syndicate members, if any. Thereafter, additional Closings will be held as funds are received up to the
earlier to occur of receipt of the $7,500,000 Maximum Offering Amount or the Termination Date. Boustead and the Company, in their sole
discretion, may accept subscriptions in excess of the Maximum Offering Amount. Pending receipt of the Minimum Amount, all subscriptions
will be placed in escrow with the Escrow Agent. If, for any reason, the Minimum Amount of subscriptions are not received by the Termination
Date, all escrowed funds will be returned to subscribers, without interest or deduction. The Securities subscribed for herein shall not
be deemed issued to or owned by me until one copy of this Subscription Agreement has been executed by me and countersigned by the Company
and the Closing with respect to such Securities has occurred.
5. Disclosure.
Because this offering is limited to accredited investors as defined in Section 2(15) of the Securities Act, and Rule 501 promulgated thereunder,
in reliance upon the exemption contained in Section 4(a)(2) of the Securities Act and applicable state securities laws, the Securities
are being sold without registration under the Securities Act. I acknowledge receipt of the Offering Documents and represent that I have
carefully reviewed and understand the Offering Documents, including all exhibits attached hereto. I have received all information and
materials regarding the Company that I have requested. I fully understand that the Company has a limited financial and operating history
and that the Securities are speculative investments which involve a high degree of risk, including the potential loss of my entire investment.
I fully understand the nature of the risks involved in purchasing the Securities and I am qualified to make such investment based on my
knowledge of and experience in investing in securities of this type. I have carefully considered the potential risks relating to the Company
and purchase of its Securities and have, in particular, reviewed each of the risks set forth in the Offering Documents. Both my advisors
and I have had the opportunity to ask questions of and receive answers from representatives of the Company or persons acting on its behalf
concerning the Company and the terms and conditions of a proposed investment in the Company and my advisors and I have also had the opportunity
to obtain additional information necessary to verify the accuracy of information furnished about the Company. Accordingly, I have independently
evaluated the risks of purchasing the Securities.
6. Investor Representations and
Warranties. I acknowledge, represent and warrant to, and agree with, the Company as follows:
| a. | I am aware that my investment involves a high degree of risk as disclosed in the
Offering Documents and have read carefully the Offering Documents, and I understand that by signing this Subscription Agreement I am agreeing
to be bound by all of the terms and conditions of the Offering Documents. |
| b. | I acknowledge and am aware that there is no assurance as to the future performance
of the Company. |
| c. | I acknowledge that there may be certain adverse tax consequences to me in connection
with my purchase of Securities, and the Company has advised me to seek the advice of experts in such areas prior to making this investment. |
| d. | I am purchasing the Securities for my own account for investment purposes only and
not with a view to or for sale in connection with the distribution of the Securities, nor with any present intention of selling or otherwise
disposing of all or any part of the foregoing securities. I agree that I must bear the entire economic risk of my investment for an indefinite
period of time because, among other reasons, the Securities have not been registered under the Securities Act or under the securities
laws of any state and, therefore, cannot be resold, pledged, assigned or otherwise disposed of unless they are subsequently registered
under the Securities Act and under applicable securities laws of certain states or an exemption from such registration is available. I
hereby authorize the Company to place a restrictive legend on the Securities that are issued to me. |
| e. | I recognize that the Securities, as an investment, involve a high degree of risk
including, but not limited to, the risk of economic losses from operations of the Company and the total loss of my investment. I believe
that the investment in the Securities is suitable for me based upon my investment objectives and financial needs, and I have adequate
means for providing for my current financial needs and contingencies and have no need for liquidity with respect to my investment in the
Company. |
| f. | I have been given access to full and complete information regarding the Company
and have utilized such access to my satisfaction for the purpose of obtaining information in addition to, or verifying information included
in, the Offering Documents, and I have either met with or been given reasonable opportunity to meet with officers of the Company for the
purpose of asking questions of, and receiving answers from, such officers concerning the terms and conditions of the offering of the Securities
and the business and operations of the Company and to obtain any additional information, to the extent reasonably available. |
| g. | I have such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of an investment in the Securities and have obtained, in my judgment, sufficient information
from the Company to evaluate the merits and risks of an investment in the Company. I have not utilized any person as my purchaser representative
as defined in Regulation D under the Securities Act in connection with evaluating such merits and risks. |
| h. | I have relied solely upon my own investigation in making a decision to invest in
the Company. |
| i. | I have received no representation or warranty from the Company or any of its officers, directors,
employees or agents in respect of my investment in the Company and I have received no information (written or otherwise) from them
relating to the Company or its business other than as set forth in the Offering Documents. I am not participating in the offer as a result of or subsequent
to: (i) any advertisement, article, notice or other communication published in any newspaper, magazine or similar media or broadcast over
television or radio or (ii) any seminar or meeting whose attendees have been invited by any general solicitation or general advertising. |
| j. | I have had full opportunity to ask questions and to receive
satisfactory answers concerning the offering and other matters pertaining to my investment and all such questions have been answered
to my full satisfaction. |
| k. | I have been provided an opportunity to obtain any additional information concerning
the offering and the Company and all other information to the extent the Company possesses such information or can acquire it without
unreasonable effort or expense. |
| l. | I am an “accredited investor” as defined in Section
2(15) of the Securities Act and in Rule 501 promulgated thereunder and have attached the completed Accredited Investor Questionnaire
to indicate my “accredited investor” status. I can bear the entire economic risk of the investment in the Securities for
an indefinite period of time and I am knowledgeable about and experienced in making investments in the equity securities of non-publicly
traded companies, including early stage companies. I am not acting as an underwriter or a conduit for sale to the public or to others
of unregistered securities, directly or indirectly, on behalf of the Company or any person with respect to such securities. |
| m. | I understand that (1) the Securities have not been registered
under the Securities Act, or the securities laws of certain states, in reliance on specific exemptions from registration, (2) no securities
administrator of any state or the federal government has recommended or endorsed this offering or made any finding or determination relating
to the fairness of an investment in the Company, and (3) the Company is relying on my representations and agreements for the purpose
of determining whether this transaction meets the requirements of certain exemptions from registration afforded by the Securities Act
and certain state securities laws. |
| n. | I understand that since neither the offer nor sale of the Securities has been registered
under the Securities Act or the securities laws of any state, the Securities may not be sold, assigned, pledged or otherwise disposed
of unless they are so registered or an exemption from such registration is available. |
| o. | I have had the opportunity to seek independent advice from my professional advisors
relating to the suitability of an investment in the Company in view of my overall financial needs and with respect to the legal and tax
implications of such investment. |
| p. | If the Investor is a corporation, company, trust, employee benefit plan, individual
retirement account, Keogh Plan, or other tax-exempt entity, it is authorized and qualified to become an Investor in the Company and the
person signing this Subscription Agreement on behalf of such entity has been duly authorized by such entity to do so. |
| q. | The information contained in my Investor Questionnaire, as well as any information
which I have furnished to the Company with respect to my financial position and business experience, is correct and complete as of the
date of this Subscription Agreement and, if there should be any material change in such information prior to the Closing of the offering,
I will furnish such revised or corrected information to the Company. I hereby acknowledge and am aware that except for any rescission
rights that may be provided under applicable laws, I am not entitled to cancel, terminate or revoke this subscription and any agreements
made in connection herewith shall survive my death or disability. |
7.
Placement Agent. The Company has engaged Boustead Securities LLC, a broker-dealer licensed with FINRA (the “Placement
Agent”), as placement agent for the Offering on a reasonable best efforts basis. The Company anticipates that the
Placement Agent and its sub-agents or syndicate members will be paid at each Closing from the proceeds in the Escrow Account, fees
including and not to exceed: a cash commission of seven percent (7%) of the gross Purchase Price paid by Subscribers in the
Offering; a non-accountable expense allowance for certain investors of one percent (1%) of the gross purchase price paid by
Subscribers in the Offering; and will receive warrants to purchase a number of shares of Common Stock equal to seven percent (7%) of
the Common Stock underlying the Notes sold in the Offering to investors, with a term of five (5) years from the relevant Closing
Date, and at a per share exercise price equal to the conversion price of the Notes issued to the Subscribes herein (the
“Placement Agent Warrants”). Any sub-agent or syndicate member of the Placement Agent that introduces investors
to the Offering will be entitled to share in the cash fees and Placement Agent Warrants attributable to those investors as described
above, pursuant to the terms of an executed sub-agent or selected dealer agreement. The Company will also pay certain expenses of
the Placement Agent.
8.
Representations and Warranties of the Company. When used in this Section 8, unless the context indicates otherwise, all
references to the “Company” also mean and include the direct and indirect subsidiaries of the Company. The Company
hereby represents and warrants to the Subscriber, as of the date hereof and on each Closing Date, the following:
| a. | Organization
and Qualification. The Company and each of its subsidiaries, if any, is a corporation
or other business entity duly organized, validly existing and in good standing under the
laws of the jurisdiction of its formation, and has the requisite corporate power to own its
properties and to carry on its business as now being conducted. The Company and each of its
subsidiaries is duly qualified as a foreign corporation to do business and is in good standing
in every jurisdiction in which the nature of the business conducted by it makes such qualification
necessary, except to the extent that the failure to be so qualified or be in good standing
would not have a material adverse effect on the assets, business, financial condition, results
of operations or future prospects of the Company and its subsidiaries taken as a whole (a “Material
Adverse Effect”). |
| b. | Authorization, Enforcement, Compliance with Other Instruments. (i) The Company has the
requisite corporate power and authority to enter into and perform its obligations under this Agreement, and each of the Offering
Documents and to issue the Securities in accordance with the terms hereof, (ii) the execution and delivery by the Company of each of
the Offering Documents and the consummation by it of the transactions contemplated hereby and thereby, including, without
limitation, the issuance of the Securities have been, or will be at the time of execution of such Offering Document, duly authorized
by the Company’s Board of Directors, and no further consent or authorization is, or will be at the time of execution of such
Offering Document, required by the Company, its respective Board of Directors or its stockholders, (iii) each of the Offering
Documents will be duly executed and delivered by the Company, (iv) the Offering Documents when executed and delivered by the Company
and each other party thereto will constitute the valid and binding obligations of the Company enforceable against the Company in
accordance with their terms, except as such enforceability may be limited by general principles of equity or applicable bankruptcy,
insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting generally, the enforcement of
creditors’ rights and remedies. |
| c. | Capitalization.
Pursuant to its Certificate of Incorporation, the authorized capital stock of the Company
consists of 150,000,000 shares of capital stock, each with a par value of $0.0001 per share,
consisting of (a) 150,000,000 shares of Common Stock (the “Common Stock”), and
(b) no shares of preferred stock. Immediately prior to the Initial Closing, the Company will
have no more than 38,240,323 shares of Common Stock outstanding, and no shares of Preferred
Stock issued and outstanding. Of the 38,240,323 outstanding shares of common stock, 17,934,461
shares, or 47% of the outstanding Common Stock, is owned by Dennis Gile and 4,449,700 shares,
or 11.6% of the outstanding Common Stock is owned by John Dorsey. The remaining shares are
held by 18 additional shareholders, each owning less than 5% of the outstanding shares of
Common Stock. |
All
of the outstanding shares of Common Stock of the Company and all of the share capital of each of the Company’s subsidiaries
have been or will be, as of the Initial Closing, duly authorized, validly issued and are fully paid and nonassessable. No shares of
capital stock of the Company or any of its subsidiaries will be subject to preemptive rights or any other similar rights or any
liens or encumbrances suffered or permitted by the Company; (ii) there will be no agreements or arrangements under which the Company
or any of its subsidiaries is obligated to register the sale of any of their securities under the Securities Act, and (iii) there
are no securities or instruments of the Company or any of its subsidiaries containing anti-dilution or similar provisions, including
the right to adjust the exercise, exchange or reset price under such securities, that will be triggered by the issuance of the
Securities as described in this Agreement. Upon request, the Company will make available to the Subscriber true and correct copies
of the Company’s Certificate of Incorporation, as amended and as in effect on the date hereof (the “Certificate of
Incorporation”), and the Company’s By-laws, as amended as in effect on the date hereof (the
“By-laws”), and the terms of all securities exercisable for Common Stock and the material rights of the holders
thereof in respect thereto other than stock options issued to officers, directors, employees and consultants.
| d. | Subsidiaries
and Affiliates. The Company has no direct or indirect subsidiaries. The Company has 5 “affiliates”: as that term is defined under Rule
405 of the Securities Act. |
| e. | Issuance of Securities. The Securities are duly authorized and, upon issuance
in accordance with the terms hereof, shall be duly issued, fully paid and nonassessable, and will be free and clear of all taxes, liens
and charges with respect to the issue thereof. |
| f. | No Conflicts. The execution, delivery and performance of each of the Offering
Documents by the Company, and the consummation by the Company of the transactions contemplated hereby and thereby will not (i) result
in a violation of the Certificate of Incorporation or the By-laws (or equivalent constitutive document) of the Company or any of its subsidiaries
or (ii) violate or conflict with, or result in a breach of any provision of, or constitute a default (or an event which with notice or
lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation
of, any agreement, indenture or instrument to which the Company or any subsidiary is a party, except for those which would not reasonably
be expected to have a Material Adverse Effect, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree
(including U.S. federal and state securities laws and regulations) applicable to the Company or any subsidiary or by which any property
or asset of the Company or any subsidiary is bound or affected except for those which could not reasonably be expected to have a Material
Adverse Effect. Except those which could not reasonably be expected to have a Material Adverse Effect, neither the Company nor any subsidiary
is in violation of any term of or in default under its constitutive documents. Except those which could not reasonably be expected to
have a Material Adverse Effect, neither the Company nor any subsidiary is in violation of any term of or in default under any material
contract, agreement, mortgage, indebtedness, indenture, instrument, judgment, decree or order or any statute, rule or regulation applicable
to the Company or any subsidiary. The business of the Company and its subsidiaries is not being conducted, and shall not be conducted
in violation of any law, ordinance, or regulation of any governmental entity, except for any violation which could not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect. Except as specifically contemplated by this Agreement and as required
under the Securities Act and any applicable state securities laws, neither the Company nor any of its subsidiaries is required to obtain
any consent, authorization or order of, or make any filing or registration with, any court or governmental agency in order for it to execute,
deliver or perform any of its obligations under or contemplated by this Agreement or the other Offering
Documents in accordance with the terms hereof or thereof. Neither the execution and delivery by the Company of the Offering Documents,
nor the consummation by the Company of the transactions contemplated hereby or thereby, will require any notice, consent or waiver under
any contract or instrument to which the Company or any subsidiary is a party or by which the Company or any subsidiary is bound or to
which any of their assets is subject, except for any notice, consent or waiver the absence of which would not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect and would not adversely affect the consummation of the transactions
contemplated hereby or thereby. All consents, authorizations, orders, filings and registrations which the Company or any of its subsidiaries
is required to obtain pursuant to the preceding two sentences have been or will be obtained or effected on or prior to the Closing. |
| g. | Absence of Litigation. There is no action, suit, claim, inquiry, notice
of violation, proceeding (including any partial proceeding such as a deposition) or investigation before or by any court, public
board, governmental or administrative agency, self-regulatory organization, arbitrator, regulatory authority, stock market, stock
exchange or trading facility (an “Action”) now pending or, to the knowledge of the Company, threatened, against or affecting the Company
or any of its subsidiaries, wherein an unfavorable decision, ruling or finding would (i) adversely affect the validity or enforceability
of, or the authority or ability of the Company to perform its obligations under this Agreement or any of the other Offering Documents,
or (ii) have a Material Adverse Effect. |
| h. | Acknowledgment Regarding Subscriber’s
Purchase of the Securities. The Company acknowledges and agrees that each Subscriber is acting solely in the capacity of an arm’s
length purchaser with respect to the Offering Documents and the transactions contemplated hereby and thereby. The Company further
acknowledges that each Subscriber is not acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with
respect to the Offering Documents and the transactions contemplated hereby and thereby and any advice given by such Subscriber or any
of their respective representatives or agents in connection with the Offering Documents and the transactions contemplated hereby and
thereby is merely incidental to such Subscriber’s purchase of the Securities. |
| i. | No General Solicitation. Neither the
Company, nor any of its “affiliates” (as defined in Rule 144 under the Securities Act), nor, to the knowledge of the
Company, any person acting on its or their behalf, has engaged in any form of general solicitation or general advertising (within
the meaning of Regulation D) in connection with the offer or sale of the Securities. |
| j. | No Integrated Offering. Neither the Company, nor any of its affiliates, nor
to the knowledge of the Company, any person acting on its or their behalf has, directly or indirectly, made any offers or sales of any
security or solicited any offers to buy any security, under circumstances that would require registration of the Securities under the
Securities Act or cause this offering of the Securities to be integrated with prior offerings by the Company for purposes of the Securities
Act. |
| k. | Employee Relations. Neither the Company nor any subsidiary is involved
in any labor dispute nor, to the knowledge of the Company, is any such dispute threatened. Neither the Company nor any subsidiary is
party to any collective bargaining agreement. The Company’s and/or its subsidiaries’ employees are not members of any
union, and the Company believes that its and its subsidiaries’ relationship with their respective employees is good. |
| l. | Permits. The Company and its subsidiaries have all authorizations,
approvals, clearances, licenses, permits, certificates or exemptions (including manufacturing approvals and authorizations, pricing and
reimbursement approvals, labeling approvals, registration notifications or their foreign equivalent) issued by any regulatory
authority or governmental agency (collectively, “Permits”) required to conduct their respective businesses as
currently conducted except to the extent that the failure to have such Permits would not have a Material Adverse Effect. The Company
or its subsidiaries have fulfilled and performed in all material respects their obligations under each Permit, and, as of the date
hereof, to the knowledge of the Company, no event has occurred or condition or state of facts exists which would constitute a breach
or default or would cause revocation or termination of any such Permit except to the extent that such breach, default, revocation or
termination would not have a Material Adverse Effect. |
| m. | Title. Each of the Company and its subsidiaries has good and marketable title to all of its real
and personal property and assets, free and clear of any material restriction, mortgage, deed of trust, pledge, lien, security interest
or other charge, claim or encumbrance which would have a Material Adverse Effect. With respect to properties and assets it leases, each
of the Company and its subsidiaries is in material compliance with such leases and holds a valid leasehold interest free of any liens,
claims or encumbrances which would have a Material Adverse Effect. |
| n. | Rights of First Refusal. The Company is not obligated to offer the Securities offered hereunder
on a right of first refusal basis or otherwise to any third parties including, but not limited to, current or former stockholders of the
Company, underwriters, brokers, agents or other third parties. |
| o. | Reliance. The Company acknowledges that the Subscriber is relying on the representations and warranties
made by the Company hereunder and that such representations and warranties are a material inducement to the Subscriber purchasing the
Securities. The Company further acknowledges that without such representations and warranties of the Company made hereunder, the Subscribers
would not enter into this Agreement. |
| p. | Brokers’ Fees. The Company does not have any liability or obligation to pay any fees or
commissions to any broker, finder or agent with respect to the transactions contemplated by this Agreement, except for the payment
of fees to the Placement Agent as described above. |
| q. | Off-Balance Sheet Arrangements. There is no transaction, arrangement, or other relationship between
the Company or any subsidiary and an unconsolidated or other off-balance sheet entity that is required to be disclosed by the Company
in the Financial Statements and is not so disclosed or that otherwise would have a Material Adverse Effect. |
| r. | Investment Company. The Company is not required to be
registered as, and is not an affiliate of, and immediately following the Closing will not be required to register as, an
“investment company” within the meaning of the Investment Company Act of 1940, as amended.
|
| s. | Reliance. The Company acknowledges that the Purchaser is relying on the representations and warranties
made by the Company hereunder and that such representations and warranties are a material inducement to the Purchaser purchasing the Notes.
The Company further acknowledges that without such representations and warranties of the Company made hereunder, the Purchaser would not
enter into this Agreement. |
9. Indemnification.
I hereby agree to indemnify and hold harmless the Company and its officers, directors, shareholders, employees, agents, advisors and
counsel, and Boustead Securities, LLC and its officers, directors, shareholders, employees, agents, advisors and counsel, against
any and all losses, claims, demands, liabilities and expenses (including reasonable legal or other expenses, including reasonable
attorneys’ fees) incurred by each such person in connection with defending or investigating any such claims or liabilities,
whether or not resulting in any liability to such person, to which
any such indemnified party may become subject under the Securities Act, under any other statute, at common law or otherwise, insofar as
such losses, claims, demands, liabilities and expenses (a) arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact made by me and contained in this Subscription Agreement or my Investor Questionnaire, or (b) arise out of or are based
upon any breach by me of any representation, warranty, or agreement made by me contained herein or therein.
10.
Severability. In the event any parts of this Subscription Agreement are found to be void, the remaining provisions of this
Subscription Agreement shall nevertheless be binding with the same effect as though the void parts were deleted.
11.
Choice of Law and Jurisdiction. This Subscription Agreement shall be governed by the laws of the State of Delaware as
applied to contracts entered into and to be performed entirely within the State of Delaware. Any action arising out of this Subscription
Agreement shall be brought exclusively in a court of competent jurisdiction in Newcastle County, Delaware, and the parties hereby irrevocably
waive any objections they may have to venue in Newcastle County, Delaware.
12.
Counterparts. This Subscription Agreement may be executed in one or more counterparts, each of which shall be deemed
an original but all of which together shall constitute one and the same instrument. The execution of this Subscription Agreement may be
by actual or facsimile signature.
13. Benefit. This Subscription Agreement shall be binding upon and inure to the benefit of the parties hereto.
14.
Notices and Addresses. All notices, offers, acceptance and any other acts under this Subscription Agreement (except
payment) shall be in writing, and shall be sufficiently given if delivered to the addresses in person, by Federal Express or similar courier
delivery, as follows:
| |
Investor: |
At the address designated on the signature page of
this Subscription Agreement. |
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The Company: |
Signing Day Sports, Inc.
7272 E. Indian School Road
Suite 101
Scottsdale, AZ 85251 |
or to such other address as any of them, by
notice to the others may designate from time to time. The transmission confirmation receipt from the sender’s facsimile
machine shall be conclusive evidence of successful facsimile delivery. Time shall be counted to, or from, as the case may be, the
delivery in person or by mailing.
15.
Entire Agreement. This Subscription Agreement constitutes the entire agreement between the parties with respect to the
subject matter hereof and supersedes all prior oral and written agreements between the parties hereto with respect to the subject matter
hereof. This Subscription Agreement may not be changed, waived, discharged, or terminated orally but, rather, only by a statement in writing
signed by the party or parties against which enforcement or the change, waiver, discharge or termination is sought.
16.
Section Headings. Section headings herein have been inserted for reference only and shall not be deemed to limit or
otherwise affect, in any matter, or be deemed to interpret in whole or in part, any of the terms or provisions of this Subscription Agreement.
17.
Survival of Representations, Warranties and Agreements. The representations, warranties and agreements contained herein
shall survive the delivery of, and the payment for, the Securities.
18. Acceptance of Subscription. The Company may accept
this Subscription Agreement at any time for all or any portion of the Securities subscribed for by executing a copy hereof as provided
and notifying me within a reasonable time thereafter.
RESIDENTS
OF ALL STATES: THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION AND ARE BEING OFFERED AND SOLD IN RELIANCE ON
EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF SAID ACT AND SUCH LAWS. THE SECURITIES ARE SUBJECT TO RESTRICTIONS ON
TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER SAID ACT AND SUCH LAWS PURSUANT TO
REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY WILL BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS
INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE
COMMISSION, ANY STATE SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR
ENDORSED THE MERITS OF THIS OFFERING OR THE ACCURACY OR ADEQUACY OF THE OFFERING DOCUMENTS. ANY REPRESENTATION TO THE CONTRARY IS
UNLAWFUL.
SALES IN FLORIDA: THE SECURITIES
OFFERED HEREBY WILL BE SOLD, AND ACQUIRED, IN A TRANSACTION EXEMPT UNDER SECTION 517.061(11) OF THE FLORIDA SECURITIES AND INVESTOR PROTECTION
ACT. THE SECURITIES HAVE NOT BEEN REGISTERED UNDER SAID ACT IN THE STATE OF FLORIDA. PURSUANT TO SECTION 517.061(11) OF THE FLORIDA SECURITIES
AND INVESTOR PROTECTION ACT, WHEN SALES ARE MADE TO FIVE (5) OR MORE PERSONS IN THE STATE OF FLORIDA, ANY SALE IN THE STATE OF FLORIDA
MADE PURSUANT TO SECTION 517.061(11) OF SUCH ACT IS VOIDABLE BY THE PURCHASER IN SUCH SALE (WITHOUT INCURRING ANY LIABILITY TO THE COMPANY
OR TO ANY OTHER PERSON OR ENTITY) EITHER WITHIN THREE (3) DAYS AFTER THE FIRST TENDER OF CONSIDERATION IS MADE BY SUCH PURCHASER TO THE
ISSUER, AN AGENT OF THE ISSUER, OR AN ESCROW AGENT OR WITHIN THREE (3) DAYS AFTER THE AVAILABILITY OF THAT PRIVILEGE IS COMMUNICATED TO
SUCH PURCHASER, WHICHEVER OCCURS LATER. TO VOID HIS OR HER PURCHASE, THE PURCHASER NEED ONLY SEND A LETTER OR TELEGRAM TO THE COMPANY
AT THE ADDRESS INDICATED HEREIN. ANY SUCH LETTER OR TELEGRAM SHOULD BE SENT AND POSTMARKED PRIOR TO THE END OF THE AFOREMENTIONED THREE
(3) DAY PERIOD. IT IS PRUDENT TO SEND ANY SUCH LETTER BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO ASSURE THAT IT IS RECEIVED AND ALSO
TO HAVE EVIDENCE OF THE TIME THAT IT WAS MAILED. SHOULD A PURCHASER MAKE THIS REQUEST ORALLY, THAT PURCHASER MUST ASK FOR WRITTEN CONFIRMATION
THAT THE REQUEST HAS BEEN RECEIVED. IF NOTICE IS NOT RECEIVED WITHIN THE TIME LIMIT SPECIFIED HEREIN, THE FOREGOING RIGHT TO VOID THE
PURCHASE SHALL BE NULL AND VOID.
(Remainder of Page left intentionally
blank.)
THE AGGREGATE AMOUNT SUBSCRIBED FOR HEREBY IS:
$1,500,000 principal
Notes for a total subscription price of $1,500,000
Manner in Which Title is to be Held. (check one)
| ☐ |
Individual Ownership |
☐ |
Community Property |
| ☐ |
Joint Tenant with Right of Survivorship (both parties must sign) |
| ☐ |
Partnership |
☐ |
Tenants in common |
| ☒ |
Corporation Trust |
☐ |
IRA or Keogh |
| ☐ |
Other(Please indicate) |
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| INDIVIDUAL INVESTORS |
|
☒ ENTITY INVESTORS |
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Name of entity, if any |
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| Signature (Individual) |
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By: |
/s/ Daniel Nelson |
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*Signature |
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Its: |
Trustee |
| Signature (Joint) (all record holders must sign) |
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Title: |
Nelson Revocable Living Trust |
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Daniel Nelson |
| Name(s) Typed or Printed |
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Name |
Typed or Printed |
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| Address toWhich Correspondence |
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Address to Which Correspondence |
| Should be Directed |
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Should be Directed |
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Scottsdale, AZ 85260 |
| City, State and Zip Code |
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City, State and Zip Code |
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[Redacted] |
| Tax Identification or Social Security Number |
|
Tax Identification or Social Security Number |
| * |
If Securities are being subscribed for by any entity, the Certificate of Signatory on the next
page must also be completed |
The foregoing subscription is accepted and the
Company hereby agrees to be bound by its terms on 15 day of October, 2021.
| |
Signing Day Sports, Inc. |
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| Dated: 10/15/2021 |
By: |
/s/ John Dorsey |
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Name: |
John Dorsey |
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Its |
Chief Executive Officer |
CERTIFICATE OF SIGNATORY
(To be completed if Securities are being subscribed for by
an entity)
| I, |
Daniel
Nelson, |
the |
Trustee |
|
| (name of signatory) |
|
(title) |
|
| of |
Nelson Revocable Living Trust |
(“Entity”), a |
Trust |
|
| (name of entity) |
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(type of entity) |
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Organized
under the laws of Arizona, hereby certify that I am empowered and duly authorized by the Entity to execute the Subscription Agreement
and to purchase the Securities, and certify further that the Subscription Agreement has been duly and validly executed on behalf of the
Entity and constitutes a legal and binding obligation of the Entity.
IN
WITNESS WHEREOF, I have set my hand this day of September 13, 2021.
|
/s/ Daniel Nelson |
|
(Signature) |
15
Exhibit 16
Exhibit F
INVESTOR RIGHTS AND LOCK-UP
AGREEMENT
This INVESTOR RIGHTS AND
LOCK-UP AGREEMENT (this “Agreement”) is made and entered into as of October 15, 2021 by and among SIGNING DAY
SPORTS, INC., a Delaware corporation (the “Company”
and the investor on the signature page hereto.
RECITALS
A. The
Investors have agreed to purchase from the Company, and the Company has agreed to sell to the Investors, [6%] convertible notes of the
Company due [October 15, 2024] (the “Notes” on the terms and conditions set forth in that certain Subscription Agreement,
dated as of [October 15, 2021] by and among the Company and the Investors, as amended from time to time (the “Subscription
Agreement” and together with the related Exhibits to the Subscription Agreement, and the Notes, collectively, the “Transaction
Documents”); and
B. Unless
otherwise defined in this Agreement all capitalized terms when used herein shall have the same meaning as they are defined in the Subscription
Agreement and the Notes.
C. It
is a condition to the closing of the sale of the Notes that the parties hereto execute and deliver this Agreement.
NOW, THEREFORE, in consideration
of the foregoing recitals and the mutual promises hereinafter set forth, the parties hereto agree as follows:
1. COVENANTS OF THE COMPANY
1.1 Information Rights.
(a) Basic Financial Information.
The Company will furnish to each Investor and any owner of 5% or more of the outstanding shares of Common Stock (“Qualifying
Owner”)
(i) as
soon as practicable, but no later than 120 days after the end of each fiscal year of the Company, (A) a balance sheet as of the end of
such fiscal year, (B) a profit and loss statement as of the end of such fiscal year, (C) a statement of cash flows of the Company as
of the end of such fiscal year, and (D) a statement of stockholders’ equity as of the end of such fiscal year, all prepared in
accordance with generally accepted accounting principles and practices (“GAAP”) and audited and certified by an recognized
accounting firm that is a PCAOB qualified auditor, commencing with the 2021 fiscal year;
(ii)
as soon as practicable, but no later than twenty four (24) days after the end of each calendar month, unaudited statements of income
and of cash flows for such month, an unaudited balance sheet and a statement of stockholders’ equity, all prepared in accordance
with GAAP after (except that such financial statements may (A) be subject to normal year-end auditing adjustments, and (B) not contain
all notes thereto that may be required in accordance with GAAP, as required), and key Company business metrics and performance indicators
as of the end of such month;
(iii) as
soon as practicable, but not later than 45 days after each fiscal quarter of the Company, quarterly reports of management of the Company
generally describing material Company events from that quarter (except that such reports may (A) be subject to normal year-end auditing
adjustments, and (B) not contain all notes thereto that may be required in accordance with GAAP, as required);
(iv) as
soon as practicable, after a change of more than ten percent (10%) of the stock ownership of the Company, a statement showing the number
of shares of each class and series of capital stock and securities convertible into or exercisable for shares of capital stock outstanding
at the end of the period, the Common Stock issuable upon conversion or exercise of any outstanding securities convertible or exercisable
for Common Stock and the exchange ratio or exercise price applicable thereto, and the number of shares of issued stock options and stock
options not yet issued but reserved for issuance, if any, all in sufficient detail as to permit the Holders to calculate their respective
percentage equity ownership in the Company, and certified by the Chief Executive Officer or senior finance officer of the Company as
being true, complete, and correct;
(v)
as soon as practicable, but in any event by December 1 of each calendar year, the officers of the Company shall prepare and present
an annual budget (the “Budget”) for the Company and each of its subsidiaries for the upcoming year, which Budget
shall include, without limitation, all expense and capital spending expectations for the Company;
(vi) as
soon as practicable, but in any event by March 15 after the end of the fiscal year of the Company, all tax information necessary for the
Investors to file their respective state and federal tax filings;
(vii)
at the option of an
Investor holding a majority of the outstanding Notes (the “Majority Investor”), and up to two times annually, certain officers
of the Company, as selected by the Majority Investors (which may include, among others, the Chief Executive Officer and/or senior finance
officer), shall provide an in-person presentation to the Investors at the Company’s corporate headquarters or by Video teleconference
covering, among any other topic(s) selected by the Investor or Qualifying Owner, the performance of (past and forecasted), recent developments
relating to, and material risks facing, the Company; and
(viii) such
other information relating to the financial condition, business, prospects, or corporate affairs of the Company as the Majority Investor
may from time to time reasonably request.
If, for any
period, the Company has any subsidiary whose accounts are consolidated with those of the Company, then in respect of such period the financial
statements delivered pursuant to the foregoing sections shall be the consolidated and consolidating financial statements of the Company
and all such consolidated subsidiaries.
Notwithstanding
anything else in this Section 1.1 to the contrary, the Company may cease providing the information set forth in this Section
1.1 during the period starting with the date thirty (30) days before the Company’s good faith estimate of the date of filing
of a registration statement in accordance with the Securities Act of 1933, as amended or the Securities Exchange Act of 1934, as amended;
provided that (i) the Company’s covenants under this Section 1.1 shall be reinstated at such time as the Company is no longer
actively employing its commercially reasonable efforts to cause such registration statement to become effective or such registration
statement is withdrawn.
(b) Inspection
Rights. At all times while the Notes remain outstanding, the Company shall cause to be maintained
full and accurate books of account, which shall reflect all Company transactions and be appropriate and adequate for the
Company’s business. The books and records of the Company shall be maintained at the principal office of the Company. Each
Investor shall have the right during ordinary business hours and upon reasonable notice to inspect and copy all books and records of
the Company.
2.
RESTRICTIONS ON TRANSFER.
2.1 Each
of the Holders hereby covenant and agree that except as set forth below, they shall not sell, transfer, convey or assign
(collectively “Transfer”) any Conversion Shares to any Person, other than to members of their immediate family
(children, spouse or parents, any entity wholly-owned by such Holder or trusts for the benefit of the Holder or members of his or
its family (each a “Permitted Transferee”). As a condition to each Transfer to a Permitted Transferee, such Permitted
Transferee shall agree to execute a joinder or related agreement pursuant to which he, she or it shall agree to be bound by the
terms of this Agreement.
2.2
From and after the date hereof and until the 180th day after the first to occur of (a) consummation of an IPO, (b) consummation of
a sale to a SPAC, or (c) consummation of another form of Reverse Merger, as applicable (each, the “Lock-Up Trigger Date”),
the Holder and each Permitted Transferee agrees not to sell, transfer or otherwise dispose of the Conversion Shares or common stock of
any successor-in-interest to the Company. After the 180th day following the Lock-Up Trigger Date, the Holder will be entitled
to sell all or any portion of the Conversion Shares or other common stock without restriction.
3. TAG-ALONG RIGHTS.
If a majority of the holders of the Company’s outstanding voting equity (collectively, the “Majority Stockholders”)
want to consummate a transaction that constitutes a Sale of Control (a “Sale of Control Transaction”), then the Majority
Stockholder(s) shall notify the other Investors of such proposed Sale of Control Transaction by a date which shall be not later than
fifteen (15) days prior to the Company or any such Majority Stockholder(s) entering into any definitive binding agreement
in respect thereof (the “Sale Notice”). Thereafter, each other Investor or Stockholder (each a “Tag-Along
Stockholder”) may cause the Company or such Majority Stockholder to effect a Transfer of such other Stockholder’s Stock;
in each case, only pursuant to and in accordance with the following provisions of this Section 3:
(a) The Tag-Along Stockholders shall have the right, but not the obligation, to participate in the Proposed
Sale of Control Transaction on the terms and conditions herein stated (the “Tag-Along Option”), which right shall be
exercisable upon wrirren notice (the “Acceptance Notice”) to the Company and/or the Majority Stockholders, as the case may be, within ten (10) days of receipt of the Sale Notice. Each Acceptance Notice shall indicate the
maximum amount of Notes or number of Conversion Shares that the Tag-Along Stockholder wishes to sell on the terms and conditions stated
in the Sale Notice.
(b) Each Tag-Along Stockholder shall have the right to sell a portion of its Notes or Conversion Shares pursuant to the Sale of Control
Transaction which is equal to that percentage equal of the Common Stock that is being sold by the Majority Stockholders in the Sale of
Control Transaction.
(c) Within ten (10) days after the date by which a Tag-Along Stockholder notifies the Company or the Majority Stockholders of its intent
to exercise the Tag-Along Option, the Company or the Majority Stockholders shall notify such Tag-Along Stockholder of the amount of Notes
and number of Conversion Shares held by such Tag-Along Stockholder that will be included in the sale and the date on which the Sale of
Control Transaction will be consummated, which shall be no later than the later of (i) twenty (20) days after the date by which each Holder
was required to notify the Company or the Majority Stockholders of its intent to exercise the Tag-Along Option and (ii) five (5) days
after the satisfaction of any governmental approval or filing requirements, if any.
(d) Each Tag-Along Stockholder may effect its participation in any Sale of Control Transaction, and as part of its participation in the
Sale of Control Transaction pursuant to a duly exercised Tag-Along Option, shall deliver to the Proposed Transferee at a closing to be
held at the offices of the Company (or such other place as the parties agree), one or more Notes or certificates, properly endorsed for
transfer, which represent all of the Notes or Conversion Shares owned by such Tag-Along Stockholder which is to be transferred in connection
with the Sale of Control Transaction, and each Tag-Along Stockholder shall make such representations and warranties, and shall enter into
such agreements, as are customary and reasonable in the context of the proposed Sale of Control Transaction, including, without limitation,
representations and warranties (and indemnities with respect thereto) that the Proposed Transferee of the Notes or Conversion Shares (or
interests therein) is receiving good and marketable title to such Notes or Conversion Shares (or interests therein), free and clear of
all pledges, security interests, or other liens; provided, however, that with respect to any matter as to which a Tag-Along Stockholder
shall agree to provide indemnification (other than its own title to such Notes or Conversion Shares), such Tag-Along Stockholder shall
in no event be required to provide indemnification in an amount that would exceed its pro rata portion of the total liability for which
such indemnification is sought, which pro rata portion shall be determined on the basis of the percentage of the total Notes or Conversion
Shares involved in such transfer that are represented by the Notes or Conversion Shares owned by such Tag-Along Stockholder. In addition,
each Tag-Along Stockholder and the Majority Stockholders shall reasonably cooperate and consult with each other in order to effect the
Sale of Control Transaction, and each Tag-Along Stockholder shall provide reasonable assistance to the Majority Stockholders in connection
with the preparation of disclosure schedules relating to representations and warranties to be made to the Proposed Transferee in connection
with such Sale of Control Transaction and in the determination of the appropriate scope of, or limitations or exceptions to, such representations
and warranties. At the time of consummation of the Sale of Control Transaction, the Proposed Transferee shall remit directly to each such
Tag-Along Stockholder that portion of the sale proceeds to which such Tag-Along Stockholder is entitled by reason of its participation
therein (less any adjustments due to the conversion of any convertible securities or the exercise of any exercisable securities)
4.
DRAG ALONG RIGHTS. If the Company or one or more of Majority Stockholders (collectively, the “Drag-Along Seller”)
wants to consummate a Sale of Control Transaction, the Company or the Drag-Along Sellers, as the case may be, shall have the right (but
not the obligation) to require the other Investors owning Notes or Conversion Shares (each a “Drag-Along Investor”
to Transfer all of their Notes or Conversion Shares to the Proposed Transferee for the same consideration per share and otherwise on
the same terms and conditions upon which the Drag-Along Sellers are selling their Common Stock pursuant to the provisions set forth
below (subject to any adjustments due to the conversion of any convertible securities or the exercise of any exercisable securities)
(the “Drag-Along Right”). The Company and the Drag-Along Sellers may not exercise the right set forth in this Section
4 unless it or they hold not less than fifty percent (50%) of the Company Fully-Diluted Common Stock.
(a) Prior
to making the Transfer, the Drag-Along Sellers shall first send an Offer Notice and copies of all documentation, including relevant agreements,
relating to the Transfer. Within fifteen (15) days following the date of the Offer Notice. Each Drag-Along Investor shall effect its participation
in any Sale of Control Transaction, and as part of its participation in the Sale of Control Transaction pursuant to a duly exercised Drag-Along
Right, shall deliver to the Proposed Transferee at a closing to be held at the offices of the Company (or such other place as the parties
agree), one or more certificates, properly endorsed for transfer, which represent all of the Notes or Conversion Shares owned by such
Drag-Along Investor which is to be transferred in connection with the Sale of Control Transaction, and each Drag-Along Investor shall
make such representations and warranties, and shall enter into such agreements, as are customary and reasonable in the context of the
proposed Sale of Control Transaction, including, without limitation, representations and warranties (and indemnities with respect thereto)
that the Proposed Transferee of the Notes or Conversion Shares (or interests therein) is receiving good and marketable title to such Notes
or Conversion Shares (or interests therein), free and clear of all pledges, security interests, or other liens; provided, however, that
with respect to any matter as to which a Tag-Along Stockholder shall agree to provide indemnification (other than its own title to such
Stock), such Drag-Along Investor shall in no event be required to provide indemnification in an amount that would exceed its pro rata
portion of the total liability for which such indemnification is sought, which pro rata portion shall be determined on the basis of the
percentage of the total Stock involved in such transfer that are represented by the Notes or Conversion Shares owned by such Drag-Along
Investor. In addition, each Drag-Along Investor and the Drag-Along Sellers shall reasonably cooperate and consult with each other in order
to effect the Sale of Control Transaction, and each Drag-Along Investor shall provide reasonable assistance to the Drag-Along Sellers
in connection with the preparation of disclosure schedules relating to representations and warranties to be made to the Proposed Transferee
in connection with such Sale of Control Transaction and in the determination of the appropriate scope of, or limitations or exceptions
to, such representations and warranties. If any Drag-Along Investor should fail to deliver such certificates and instruments of transfer
to the Drag-Along Sellers (or their designee), the Company shall cause its books and records to show that such shares of Notes or Conversion
Shares are bound by the provisions of this Section 4 and that such Notes or Conversion Shares shall have been transferred to the Proposed
Transferee, and all certificates or other evidence of ownership of the Notes or Conversion Shares subject to this Section 4 shall be deemed
to be cancelled.
(b) Simultaneously
with the consummation of the Sale of Control, the Company pursuant to this Section 4, the Company shall notify the Drag-Along Investors
and the other Company stockholders of the consummation of the sale, and shall cause the Proposed Transferee to remit directly to the Drag-Along
Investors and other Company stockholders (including the Drag-Along Sellers) the total sales price of the Sale of Control or consideration
paid pursuant thereto and shall furnish such other evidence of the completion and time of completion of such sale or other disposition
and the terms thereof as may be reasonably requested.
5. PARTICIPATION RIGHT.
5.1 General. Each
of the Investors (individually and collectively, the “Participation Right Holders”) has the right to co-invest and
to purchase such Participation Right Holder’s Pro Rata Share (as defined below) of all (or any part) of any New Securities (including
Common Stock being sold to the public in the IPO) that the Company may from time to time issue after the date of this Agreement (the
“Participation Right”), provided, however, such Participation Right Holder shall have no right to purchase
any such New Securities and exercise such Participation Right if such New Securities are being issued in a private placement pursuant
to Regulation 506(b) under the Securities Act and such Participation Right Holder cannot demonstrate to the Company’s reasonable
satisfaction that such Participation Right Holder is, at the time of the proposed issuance of such New Securities, an “accredited
investor” as such term is defined in Regulation D under the Securities Act. A Participation Right Holder’s “Pro
Rata Share” for purposes of this participation and co-investment right is a percentage of any New Securities (including Common
Stock sold in the IPO) equal to fifty (50%) of the amount of all Notes sold in the Offering to each Investor’s Note. For the avoidance
of doubt, if for example, and Investor purchased a $1,500,000 principal amount of Note, representing 20% of all $7,500,000 of the Notes
held by all Investors and $20,000,000 of New Securities (including Common Stock sold in the IPO) are issued prior to termination of this
Agreement, then and in such event such Investor’s Pro Rata Share of the New Securities would be $750,000.
5.2 Procedures. In the event that the Company proposes
to undertake an issuance of New Securities, it shall give to each Participation Right Holder a written notice of its intention to issue
New Securities (the “Participation Right Notice”), describing the type of New Securities and the price and the general
terms upon which the Company proposes to issue such New Securities. Each Participation Right Holder shall have twenty (20) days from the
date such Participation Right Notice is given, to agree in writing to purchase such Participation Right Holder’s Pro Rata Share
of such New Securities for the price and upon the general terms specified in the Notice by giving written notice to the Company and stating
therein the quantity of New Securities to be purchased (not to exceed such Participation Right Holder’s Pro Rata Share).
5.3 Failure to Exercise. In the event that the Participation
Right Holders fail to exercise in full the pa within such twenty (20) day period, then the Company shall have one hundred twenty (120)
days thereafter to sell the New Securities with respect to which the Participation Right Holders’ Participation Right was not exercised,
at a price not more favorable and upon general terms not materially more favorable to the purchasers thereof than specified in the Participation
Right Notice to the Participation Right Holders. In the event that the Company has not issued and sold the New Securities within such
one hundred twenty (120) day period, then the Company shall not thereafter issue or sell any New Securities without again first offering
the Participation Right in such New Securities to the Participation Right Holders pursuant to this Section 5.
6. REGISTRATION
RIGHTS. The Company covenants and agrees as follows:
6.1 Demand Registration.
(a) Resale Registration Statement.
Within 30 business days following the consummation of the first to occur of an IPO, a Sale of Control or a Reverse Merger, as applicable,
the Company will file a registration statement on Form S-1 or Form S-3, as available (the “Resale Registration Statement”)
in order to register for resale all of the shares of Common Stock of the Company or common stock of any successor-in-interest to the
Company issued to all holders of the Note upon automatic conversion of the Notes (the “Conversion Shares” and will
use its bests efforts to cause such Resale Registration Statement to be declared effective by the SEC within ninety (90) business days
from the date of its initial filing; provided, that such Conversion Shares will continue to be subject to restrictions
on resale for a period of six (6) months following completion of either the IPO, Sale of Control or Reverse Merger, as applicable.
(b) Form S-1 Demand. In
the event that, for any reason, the Company is unable to comply with the provisions of Section 6.1(a), at any time after one hundred
eighty (180) days from the effective date of the Form S-1 registration statement in connection with the IPO, the Company receives a request
from the Majority Investor(s) (the “Initiating Investors”) that the Company file a Form S-1 registration statement
with respect to the Conversion Shares then outstanding having an anticipated aggregate offering price, net of selling expenses, of at
least five million dollars ($5,000,000), then the Company shall (x) within ten (10) days after the date such request is given, give notice
thereof (the “Demand Notice”) to all Investors other than the Initiating Investors; and (y) as soon as practicable,
and in any event within sixty (60) days after the date such request is given by the Initiating Investors, file a Form S-1 registration
statement under the Securities Act covering all Conversion Shares that the Initiating Investors requested to be registered and any additional
Conversion Shares requested to be included in such registration by any other Investors, as specified by notice given by each such Holder
to the Company within twenty (20) days of the date the Demand Notice is given, and in each case, subject to the limitations of Section
6.1(d) and Section 6.3, provided, however, that the Initiating Investors may not invoke this right more than
twice.
(c) Form S-3 Demand.
In the event that, for any reason, the Company is unable to comply with the provisions of Section 6.1(a), at any time when it
is eligible to use a Form S-3 registration statement, the Company receives a request from the Initiating Investors that the Company file
a Form S-3 registration statement with respect to outstanding Conversion Shares of such Investors having an anticipated aggregate offering
price, net of Selling Expenses, of at least five million dollars ($5,000,000), then the Company shall (i) within ten (10) days after
the date such request is given, give a Demand Notice to all Investors other than the Initiating Investors; and (ii) as soon as practicable,
and in any event within forty-five (45) days after the date such request is given by the Initiating Investors, file a Form S-3 registration
statement under the Securities Act covering all Conversion Shares requested to be included in such registration by any other Investors,
as specified by notice given by each such Holder to the Company within twenty (20) days of the date the Demand Notice is given, and in
each case, subject to the limitations of Section 6.1(d) and Section 6.3.
(d) Deferral of Registration. Notwithstanding the foregoing
obligations, if the Company furnishes to Investors requesting a registration pursuant to Section 6.1(b) or Section 6.1(c) above a certificate
signed by the Company’s chief executive officer stating that in the good faith judgment of the Board it would be materially detrimental
to the Company and its stockholders for such registration statement to either become effective or remain effective for as long as such
registration statement otherwise would be required to remain effective, because such action would (i) materially interfere with a significant
acquisition, corporate reorganization, or other similar transaction involving the Company; (ii) require premature disclosure of material
information that the Company has a bona fide business purpose for preserving as confidential; or (iii) render the Company unable to comply
with requirements under the Securities Act or Exchange Act, then the Company shall have the right to defer taking action with respect
to such filing, and any time periods with respect to filing or effectiveness thereof shall be tolled correspondingly, for a period of
not more than sixty (60) days after the request of the Initiating Investors is given; provided, however, that the Company
may not invoke this right more than once in any twelve (12) month period; and provided further that the Company shall not register
any securities for its own account or that of any other stockholder during such sixty (60) day period other than an Excluded Registration.
(e) Deferral
for Company-Initiated Registration. The Company shall not be obligated to effect, or to take any action to effect, any registration
pursuant to Section 6.1(b) (i) during the period that is sixty(60) days before the Company’s good faith estimate
of the date of filing of, and ending on a date that is one hundred eighty (180) days after the effective
date of, a Company-initiated registration, provided, that the Company is actively employing in good faith commercially reasonable efforts
to cause such registration statement to become effective; (ii) after the Company has effected one registration pursuant to Section
6.1(b); or (ii) if the Initiating Investors propose to dispose of Conversion Shares that may be immediately registered on Form S-3
pursuant to a request made pursuant to Section 6.1(c). The Company shall not be obligated to effect, or to take any action to
effect, any registration pursuant to Section 6.1(c); (A) during the period that is thirty (30) days before the Company’s
good faith estimate of the date of filing of, and ending on a date that is ninety (90) days after the effective date of, a Company-initiated
registration, provided, that the Company is actively employing in good faith commercially reasonable efforts to cause such registration
statement to become effective; or (B) if the Company has effected registration pursuant to Section 6.1(c) within the twelve (12)
month period immediately preceding the date of such request. A registration shall not be counted as “effected” for purposes
of this Section 6.1(e) until such time as the applicable registration statement has been declared effective by the SEC,
unless the Initiating Investors withdraw their request for such registration, elect not to pay the registration expenses therefor, and
forfeit their right to one demand registration statement pursuant to Section 6.6, in which case such withdrawn registration statement
shall be counted as “effected” for purposes of this Section 6.1(e).
6.2 Piggyback
Registration. If, following its IPO, the Company proposes to register under the Securities Act (including, for this purpose,
a registration of Common Stock effected by the Company or for the benefit of selling stockholders other than the Investors in connection
with the public offering of such securities solely for cash (other than in an Excluded Registration), unless the Conversion Shares shall
have been previously registered for resale, the Company shall, at such time, promptly give each Holder notice of such registration. Upon
the request of each Holder given within twenty (20) days after such notice is given by the Company, the Company shall, subject to the
provisions of Section 6.3, cause to be registered all of the Conversion Shares that each such Holder has requested to be included
in such registration. The Company shall have the right to terminate or withdraw any registration initiated by it under this Section
6.2 before the effective date of such registration, whether or not any Holder has elected to include Conversion Shares in such registration.
The expenses (other than Selling Expenses) of such withdrawn registration shall be borne by the Company in accordance with Section
6.6.
6.3 Underwriting Requirements.
(a) In
connection with any offering involving an underwriting of shares of the Company’s capital stock pursuant to Section 6.1(b),
Section 6.1(c) or Section 6.2, the Company shall not be required to include any of the Investors’ Conversion Shares
in such under writing unless the Investors accept the terms of the underwriting as agreed upon between the Company and its
underwriters, and then only in such quantity as the underwriters in their sole discretion determine will not jeopardize the success
of the offering by the Company. If the total number of securities, including Conversion Shares, requested by stockholders to be
included in such offering exceeds the number of securities to be sold (other than by the Company) that the underwriters in their
reasonable discretion determine is compatible with the success of the offering, then the Company shall be required to include in the
offering only that number of such securities, including Conversion Shares, which the underwriters and the Company in their sole
discretion determine will not jeopardize the success of the offering. If the underwriters determine that less than all of the
Conversion Shares requested to be registered can be included in such offering, then the Conversion Shares that are included in such
offering shall be allocated among the selling Investors in proportion (as nearly as practicable to) the number of Conversion Shares
owned by each selling Holder or in such other proportions as shall mutually be agreed to by all such selling Investors. To
facilitate the allocation of shares in accordance with the above provisions, the Company may in its sole discretion round the number
of shares allocated to the Holder to the nearest 100 shares. Notwithstanding the foregoing, in no event shall (i) the number of
Conversion Shares included in the offering be reduced unless all other securities (other than securities to be sold by the Company)
are first entirely excluded from the offering, or (ii) the number of Conversion Shares included in the offering be reduced below
twenty percent (20%) of the total number of securities included in such offering, unless such offering is the IPO, in which case the
selling Investors may be excluded further if the underwriters make the determination described above and no other
stockholder’s securities are included in such offering or (iii) not withstanding (ii) above, any Conversion Shares which are
not Conversion Shares of the Key Owner be excluded from such underwriting unless all Conversion Shares of the Key Owner are first
excluded from such offering. For purposes of the provision in this Section 6.3(b) concerning apportionment, for any selling
Holder that is a partnership, limited liability company, or corporation, the partners, members, retired partners, retired members,
stockholders, and Affiliates of such Holder, or the estates and Immediate Family Members of any such partners, retired partners,
members, and retired members and any trusts for the benefit of any of the foregoing Persons, shall be deemed to be a single
“selling Holder,” and any pro rata reduction with respect to such “selling Holder” shall be based upon the
aggregate number of Conversion Shares owned by all Persons included in such “selling Holder,” as defined in this
sentence
(b)
For purposes of Section 6.1, a registration shall not be counted as “effected” if, as a result of an exercise
of the underwriter’s cutback provisions in Section 6.3(a), fewer than fifty percent (50%) of the total number of Conversion
Shares that Investors have requested to be included in such registration statement are actually included.
6.4 Obligations
of the Company. Whenever required under this Section 6 to effect the registration of any Conversion Shares, the Company
shall, as expeditiously as reasonably possible:
(a)
prepare and file with the SEC a registration statement with respect to such Conversion Shares and use its commercially reasonable
efforts to cause such registration statement to become effective and, upon the request of the Investors of a majority of the
Conversion Shares registered thereunder, keep such registration statement effective for a period of up to one hundred eighty (180)
days following the termination of the lock-up agreement entered into in connection with the IPO or, if earlier, until the
distribution contemplated in the registration statement has been completed; provided, however, that (i) such one
hundred eighty (180) day period shall be extended for a period of time equal to the period the Holder refrains, at the request of an
underwriter of Common Stock (or other securities) of the Company, from selling any securities included in such registration, and
(ii) in the case of any registration of Conversion Shares on Form S-3 that are intended to be offered on a continuous or delayed
basis, subject to compliance with applicable SEC rules, such one hundred eighty (180) day period shall be extended for up to sixty
(60) days, if necessary, to keep the registration statement effective until all such Conversion Shares are sold;
(b) prepare
and file with the SEC such amendments and supplements to such registration statement, and the prospectus used in connection with such
registration statement, as may be necessary to comply with the Securities Act in order to enable the disposition of all securities covered
by such registration statement;
(c) furnish
to the selling Investors such numbers of copies of a prospectus, including a preliminary prospectus, as required by the Securities Act,
and such other documents as the Investors may reasonably request in order to facilitate their disposition of their Conversion Shares;
(d) use
its commercially reasonable efforts to register and qualify the securities covered by such registration statement under such other securities
or blue-sky laws of such jurisdictions as shall be reasonably requested by the selling Investors; provided that the Company shall
not be required to qualify to do business or to file a general consent to service of process in any such states or jurisdictions, unless
the Company is already subject to service in such jurisdiction and except as may be required by the Securities Act;
(e) in
the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary
form, with the underwriter(s) of such offering;
(f) use
its commercially reasonable efforts to cause all such Conversion Shares covered by such registration statement to be listed on a national
securities exchange or trading system and each securities exchange and trading system (if any) on which similar securities issued by the
Company are then listed;
(g) provide
a transfer agent and registrar for all Conversion Shares registered pursuant to this Agreement and provide a CUSIP number for all such
Conversion Shares, in each case not later than the effective date of such registration;
(h) promptly
make available for inspection by the selling Investors, any underwriter(s) participating in any disposition pursuant to such
registration statement, and any attorney or accountant or other agent retained by any such underwriter or selected by the selling
Investors, all financial and other records, pertinent corporate documents, and properties of the Company, and cause the
Company’s officers, directors, employees, and independent accountants to supply all information reasonably requested by any
such seller, underwriter, attorney, accountant, or agent, in each case, as necessary or advisable to verify the accuracy of the
information in such registration statement and to conduct appropriate due diligence in connection therewith;
(i) notify
each selling Holder, promptly after the Company receives notice thereof, of the time when such registration statement has been declared
effective or a supplement to any prospectus forming a part of such registration statement has been filed; and
(j) after
such registration statement becomes effective, notify each selling Holder of any request by the SEC that the Company amend or supplement
such registration statement or prospectus.
In addition,
the Company shall ensure that, at all times after any registration statement covering a public offering of securities of the Company
under the Securities Act shall have become effective, its insider trading policy shall provide that the Company’s directors may
implement a trading program under Rule 10b5-1 of the Exchange Act.
6.5
Furnish Information. It shall be a condition precedent to the obligations of the Company to take any action
pursuant to this Section 4 with respect to the Conversion Shares of any selling Holder that such Holder shall furnish to the Company
such information regarding itself, the Conversion Shares held by it, and the intended method of disposition of such securities as is
reasonably required to effect the registration of such Holder’s Conversion Shares.
6.6
Expenses of Registration. All expenses (other than Selling Expenses) incurred in connection with registrations, filings, or
qualifications pursuant to Section 4, including all registration, filing, and qualification fees; printers’ and accounting fees;
fees and disbursements of counsel for the Company; and the reasonable fees and disbursements of one counsel for the Selling Investors
(“Selling Holder Counsel”), shall be borne and paid by the Company; provided however, that the Company shall not be required
to pay for any expenses of any registration proceeding begun pursuant to Section 6.1 if the registration request is subsequently
withdrawn at the request of the Investors of a majority of the Conversion Shares to be registered (in which case all selling Investors
shall bear such expenses pro rata based upon the number of Conversion Shares that were to be included in the withdrawn registration),
unless the Investors of a majority of the Conversion Shares agree to forfeit their right to one registration pursuant to Section 6.1
(a) or Section 6.1(b), as the case may be; provided further that if, at the time of such withdrawal, the Investors shall have
learned of a material adverse change in the condition, business or prospects of the Company from that known to the Investors at the time
of their request and have withdrawn the request with reasonable promptness after learning of such information then the Investors shall
not be required to pay any of such expenses and shall not forfeit their right to one registration pursuant to Section 6.1(a) or
Section 6.1(b). All Selling Expenses relating to Conversion Shares registered pursuant to this Section 5 shall be borne
and paid by the Investors pro rata on the basis of the number of Conversion Shares registered on their behalf.
6.7 Delay
of Registration. No Holder shall have any right to obtain or seek an injunction restraining or otherwise delaying any registration
pursuant to this Agreement as the result of any controversy that might arise with respect to the interpretation or implementation of this
Section 6.
6.8 Indemnification. If any Conversion
Shares are included in a registration statement under this Section 6:
(a) To
the extent permitted by law, the Company will indemnify and hold harmless each selling Holder, and the partners, members, officers, directors,
and stockholders of each such Holder; legal counsel and accountants for each such Holder; any underwriter (as defined in the Securities
Act) for each such Holder; and each Person, if any, who controls such Holder or underwriter within the meaning of the Securities Act or
the Exchange Act, against any Damages, only to the extent such Damages arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact made by the Company or arise out of or are based upon any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the statements therein not misleading, and the Company will pay to
each such Holder, underwriter, controlling Person, or other aforementioned Person any legal or other expenses reasonably incurred thereby
in connection with investigating or defending any claim or proceeding from which Damages may result, as such expenses are incurred; provided,
however, that the indemnity agreement contained in this Section 6.8(a) shall not apply to amounts paid in settlement of
any such claim or proceeding if such settlement is effected without the consent of the Company, which consent shall not be unreasonably
withheld, nor shall the Company be liable for any Damages to the extent that they arise out of or are based upon actions or omissions
made in reliance upon and in conformity with written information furnished by or on behalf of any such Holder, underwriter, controlling
Person, or other aforementioned Person expressly for use in connection with such registration.
(b) To
the extent permitted by law, each selling Holder, severally and not jointly, will indemnify and hold harmless the Company, and each of
its directors, each of its officers who has signed the registration statement, each Person (if any), who controls the Company within the
meaning of the Securities Act, legal counsel and accountants for the Company, any underwriter (as defined in the Securities Act), any
other Holder selling securities in such registration statement, and any controlling Person of any such underwriter or other Holder, against
any Damages, in each case only to the extent that such Damages arise out of or are based upon actions or omissions made in reliance upon
and in conformity with written information furnished by or on behalf of such selling Holder expressly for use in connection with such
registration; and each such selling Holder will pay to the Company and each other aforementioned Person any legal or other expenses reasonably
incurred thereby in connection with investigating or defending any claim or proceeding from which Damages may result, as such expenses
are incurred; provided, however, that the indemnity agreement contained in this Section 6.8(b) shall not apply to
amounts paid in settlement of any such claim or proceeding if such settlement is effected without the consent of the Holder, which consent
shall not be unreasonably withheld; and provided, further that in no event shall the aggregate amounts payable by any Holder
by way of indemnity or contribution under Section 6.8(b) and 6.8(d) exceed the proceeds from the offering received by such
Holder (net of any Selling Expenses paid by such Holder), except in the case of fraud or willful misconduct by such Holder.
(c) Promptly after receipt
by an indemnified party under this Section 6.8 of notice of the commencement of any action (including any governmental action)
for which a party may be entitled to indemnification hereunder, such indemnified party will, if a claim in respect thereof is to be made
against any indemnifying party under this Section 6.8, give the indemnifying party notice of the commencement thereof. The indemnifying
party shall have the right to participate in such action and, to the extent the indemnifying party so desires, participate jointly with
any other indemnifying party to which notice has been given, and to assume the defense thereof with counsel mutually satisfactory to
the parties; provided, however, that an indemnified party (together with all other indemnified parties that may be represented
without conflict by one counsel) shall have the right to retain one separate counsel, with the fees and expenses to be paid by the indemnifying
party, if representation of such indemnified party by the counsel retained by the indemnifying party would be inappropriate due to actual
or potential differing interests between such indemnified party and any other party represented by such counsel in such action. The failure
to give notice to the indemnifying party within a reasonable time of the commencement of any such action shall relieve such indemnifying
party of any liability to the indemnified party under this Section 6.8, to the extent that such failure materially prejudices the indemnifying
party’s ability to defend such action. The failure to give notice to the indemnifying party will not relieve it of any liability
that it may have to any indemnified party otherwise than under this Section 6.8.
(d) To
provide for just and equitable contribution to joint liability under the Securities Act in any case in which either (i) any party
otherwise entitled to indemnification hereunder makes a claim for indemnification pursuant to this Section 6.8 but it is
judicially determined (by the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to
appeal or the denial of the last right of appeal) that such indemnification may not be enforced in such case, notwithstanding the
fact that this Section 6.8 provides for indemnification in such case, or (ii) contribution under the Securities Act may be
required on the part of any party hereto for which indemnification is provided under this Section 6.8, then, and in each such
case, such parties will contribute to the aggregate losses, claims, damages, liabilities, or expenses to which they may be subject
(after contribution from others) in such proportion as is appropriate to reflect the relative fault of each of the indemnifying
party and the indemnified party in connection with the statements, omissions, or other actions that resulted in such loss, claim,
damage, liability, or expense, as well as to reflect any other relevant equitable considerations. The relative fault of the
indemnifying party and of the indemnified party shall be determined by reference to, among other things, whether the untrue or
allegedly untrue statement of a material fact, or the omission or alleged omission of a material fact, relates to information
supplied by the indemnifying party or by the indemnified party and the parties’ relative intent, knowledge, access to
information, and opportunity to correct or prevent such statement or omission; provided, however, that, in any such
case, (x) no Holder will be required to contribute any amount in excess of the public offering price of all such Conversion Shares
offered and sold by such Holder pursuant to such registration statement, and (y) no Person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) will be entitled to contribution from any Person who was not guilty of
such fraudulent misrepresentation; and provided, further that in no event shall a Holder’s liability pursuant to
this Section 6.8(d), when combined with the amounts paid or payable by such Holder pursuant to Section 6.8(b), exceed
the proceeds from the offering received by such Holder (net of any Selling Expenses paid by such Holder), except in the case of
willful misconduct or fraud by such Holder.
(e) Notwithstanding
the foregoing, to the extent that the provisions on indemnification and contribution contained in the underwriting agreement entered into
in connection with the underwritten public offering are in conflict with the foregoing provisions, the provisions in the underwriting
agreement shall control.
(f) Unless
otherwise superseded by an underwriting agreement entered into in connection with the underwritten public offering, the obligations of
the Company and Investors under this Section 6.8 shall survive the completion of any offering of Conversion Shares in a registration
under this Section 6.8, and otherwise shall survive the termination of this Agreement.
6.9 Reports
Under Exchange Act. With a view to making available to the Investors the benefits of SEC Rule 144 and any other rule or regulation
of the SEC that may at any time permit a Holder to sell securities of the Company to the public without registration or pursuant to a
registration on Form S-3, the Company shall:
(a) make
and keep available adequate current public information, as those terms are understood and defined in SEC Rule 144, at all times after
the effective date of the registration statement filed by the Company for the IPO;
(b) use
commercially reasonable efforts to file with the SEC in a timely manner all reports and other documents required of the Company under
the Securities Act and the Exchange Act (at any time after the Company has become subject to such reporting requirements); and
(c) furnish to any
Holder, so long as the Holder owns any Conversion Shares, forthwith upon request (i) to the extent accurate, a written statement by
the Company that it has complied with the reporting requirements of SEC Rule 144 (at any time after ninety (90) days after the
effective date of the registration statement filed by the Company for the IPO), the Securities Act, and the Exchange Act (at any
time after the Company has become subject to such reporting requirements), or that it qualifies as a registrant whose securities may
be resold pursuant to Form S-3 (at any time after the Company so qualifies); (ii) a copy of the most recent annual or quarterly
report of the Company and such other reports and documents so filed by the Company; and (iii) such other information as may be
reasonably requested in availing any Holder of any rule or regulation of the SEC that permits the selling of any such securities
without registration (at any time after the Company has become subject to the reporting requirements under the Exchange Act) or
pursuant to Form S-3 (at any time after the Company so qualifies to use such form). reporting requirements of SEC Rule 144 (at any
time after ninety (90) days after the effective date of the registration statement filed by the Company for the IPO), the Securities
Act, and the Exchange Act (at any time after the Company has become subject to such reporting requirements), or that it qualifies as
a registrant whose securities may be resold pursuant to Form S-3 (at any time after the Company so qualifies); (ii) a copy of the
most recent annual or quarterly report of the Company and such other reports and documents so filed by the Company; and (iii) such
other information as may be reasonably requested in availing any Holder of any rule or regulation of the SEC that permits the
selling of any such securities without registration (at any time after the Company has become subject to the reporting requirements
under the Exchange Act) or pursuant to Form S-3 (at any time after the Company so qualifies to use such form).
6.10 Limitations
on Subsequent Registration Rights. From and after the date of this Agreement, the Company shall not, without the prior
written consent of the Investors of a majority of the Conversion Shares then outstanding, enter into any agreement with any holder
or prospective holder of any securities of the Company that (i) would allow such holder or prospective holder to include such
securities in any registration unless, under the terms of such agreement, such holder or prospective holder may include such
securities in any such registration only to the extent that the inclusion of such securities will not reduce the number of the
Conversion Shares of the Investors that are included; or (ii) allow such holder or prospective holder to initiate a demand for
registration of any securities held by such holder or prospective holder.
6.11
“Market Stand-off” Agreement. Each Holder hereby agrees that it will not, without the prior written
consent of the managing underwriter, during the period commencing on the date of the final prospectus relating to the registration
by the Company of shares of its Common Stock and ending on the date specified by the Company and the managing underwriter (such
period not to exceed one hundred and eighty (180) days in the case of the IPO), (i) lend; offer; pledge; sell; contract to sell;
sell any option or contract to purchase; purchase any option or contract to sell; grant any option, right, or warrant to purchase;
or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or
exercisable or exchangeable (directly or indirectly) for Common Stock or (ii) enter into any swap or other arrangement that
transfers to another, in whole or in part, any of the economic consequences of ownership of such securities, whether any such
transaction described in clause (i) or (ii) above is to be settled by delivery of Common Stock or other securities, in cash, or
otherwise. The foregoing provisions of this Section 6.11 shall apply only to the IPO, shall not (A) prohibit any Holder from
buying registered shares of Common Stock in the IPO or in the aftermarket or selling such shares of Common Stock, or (B) apply to
the sale of any shares to an underwriter pursuant to an underwriting agreement, and shall be applicable to the Investors only if all
officers and directors are subject to the same restrictions. The underwriters in connection with such registration are intended
third party beneficiaries of this Section 6.11 and shall have the right, power, and authority to enforce the provisions
hereof as though they were a party hereto. Each Holder further agrees to execute such agreements as may be reasonably requested by
the underwriters in connection with such registration that are consistent with this Section 6.11 or that are necessary to
give further effect thereto. Any discretionary waiver or termination of the restrictions of any or all of such agreements by the
Company or the underwriters shall apply pro rata to all Investors subject to such agreements based on the number of shares subject
to such agreements.
6.12 Termination
of Registration Rights. The right of any Holder to request registration or inclusion of Conversion Shares in any
registration pursuant to Section 6.1 or Section 6.2 shall terminate upon the termination of the Restricted Period on
Transfers set forth in Section 2.2 above and the ability of each Holder to sell all of his or its remaining Conversion Shares in any
brokers transaction under Rule 144 and without any volume or percentage limitations on such sales.
7. ADDITIONAL INVESTOR
RIGHTS. The Company shall use commercially reasonable efforts to cause the Conversion Shares, within the meaning of Section 1202(f)
of the Internal Revenue Code (the “Code”), to constitute “qualified small business stock” as defined in
Section 1202(c) of the Code; provided, however, that such requirement shall not be applicable if the Board determines, in its good faith
business judgment, that such qualification is inconsistent with the best interests of the Company. The Company shall submit to its stockholders
(including the Investors) and to the Internal Revenue Service any reports that may be required under Section 1202(d)(1)(C) of the Code
and the regulations promulgated thereunder. In addition, within twenty (20) business days after any Investor’s written request
therefor, the Company shall, at its option, either (i) deliver to such Investor a written statement indicating whether (and what portion
of) such Investor’s interest in the Company constitutes “qualified small business stock” as defined in Section 1202(c)
of the Code or (ii) deliver to such Investor such factual information in the Company’s possession as is reasonably necessary to
enable such Investor to determine whether (and what portion of) such Investor’s interest in the Company constitutes “qualified
small business stock” as defined in Section 1202(c) of the Code.
8. GENERAL PROVISIONS.
8.1 Amendment
and Waiver of Rights. This Agreement may be amended or terminated, and the observance of any term hereof may be waived (either
generally or in a particular instance either retroactively or prospectively) only by a written instrument executed by (a) the Company;
(b) the Key Owners holding at least a majority of the outstanding Common Stock then held by the Key Owners; and (c) the Majority Investor(s).
Notwithstanding the foregoing:
(a)
any provision hereof may be waiving by the waiving party on such party’s own behalf, without the consent of any other party;
and
(b) no
such amendment, modification or waiver shall amend, modify or waive (i) any provision of this Agreement granting any personal rights to
a specific Investor or Key Owner (as opposed to the Investors, Key Owners or the holders of a specific class of stock generally), without
the prior written consent of such Investor or Key Owner; or (ii) any rights of any Investor or Key Owner in a manner that materially adversely
affects the rights of such Investor or Key Owner, unless approved in writing by such Investor or Key Owner.
The
Company shall give prompt written notice of any amendment, termination or waiver hereunder to any party that did not consent in
writing thereto. Any amendment, termination or waiver effected in accordance with this Subsection 7.1 shall be
binding on each party and all of such party’s successors and permitted assigns, whether or not any such party, successor or
assignee entered into or approved such amendment, termination or waiver. For purposes of this Subsection 7.1, the requirement
of a written instrument may be satisfied in the form of an action by written consent of the Investors circulated by the Company and
executed by the Holder parties specified, whether or not such action by written consent makes explicit reference to the terms of
this Agreement.
8.2 Notices.
All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed effectively
given upon the earlier of actual receipt or: (a) personal delivery to the party to be notified, (b) when sent, if sent by electronic
mail during normal business hours of the recipient, and if not send during normal business hours, then on the recipient’s next
business day, (c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid,
or (d) one (1) business day after deposit with a nationally recognized overnight courier, freight prepaid, specifying next business
day delivery, with written verification of receipt. All communications shall be sent to the respective parties at their address as
set forth on the signature page hereto, or to such address as subsequently modified by written notice given in accordance with this Section
7.2.
8.3 Entire
Agreement. This Agreement and the documents referred to herein, together with all the Exhibits hereto, constitute the entire agreement
and understanding of the parties with respect to the subject matter of this Agreement, and supersede any and all prior understandings
and agreements, whether oral or written, between or among the parties hereto with respect to the specific subject matter hereof.
8.4 Governing
Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, regardless of the
laws that might otherwise govern under applicable principles of conflicts of law.
8.5 Severability
The invalidity or unenforceability of any provision hereof shall in no way affect the validity or enforceability of any other provision.
8.6 Third
Parties. Nothing in this Agreement, express or implied, is intended to confer upon any person, other than the parties hereto and
their successors and assigns, any rights or remedies under or by reason of this Agreement.
8.7 Successors
and Assigns. This Agreement, and any and all rights, duties and obligations hereunder, shall not be assigned, transferred, delegated
or sublicensed by any party without the prior written consent of the other parties. Any attempt by a party without such permission to
assign, transfer, delegate or sublicense any rights, duties or obligations that arise under this Agreement shall be void. Subject to the
foregoing, and except as otherwise provided herein, this Agreement, and the rights and obligations of the parties hereunder, will be binding
upon and inure to the benefit of their respective successors, assigns, heirs, executors, administrators and legal representatives.
8.8
Titles and Headings. The titles, captions and headings of this Agreement are included for ease of reference
only and will be disregarded in interpreting or construing this Agreement. Unless otherwise specifically stated, all references herein
to “sections” and “exhibits” will mean “sections” and “exhibits” to this Agreement.
8.9 Counterparts.
This Agreement may be executed in any number of counterparts, each of which when so executed and delivered will be deemed an original,
and all of which together shall constitute one and the same agreement.
8.10 Costs
and Attorneys’ Fees. In the event that any action, suit or other proceeding is instituted concerning or arising
out of this Agreement or any transaction contemplated hereunder, the prevailing party shall recover all of such party’s costs
and attorney’s fees incurred in each such action, suit or other proceeding, including any and all appeals or petitions
therefrom.
8.11 Adjustments
for Stock Splits, Etc. Wherever in this Agreement there is a reference to a specific number of shares of Common Stock of
the Company of any class or series, then, upon the occurrence of any subdivision, combination or stock dividend of such class or series
of stock, the specific number of shares so referenced in this Agreement shall automatically be proportionally adjusted to reflect the
effect on the outstanding shares of such class or series of stock by such subdivision, combination or stock dividend.
8.12 Further
Assurances. The parties agree to execute such further documents and instruments and to take such further actions as may be reasonably
necessary to carry out the purposes and intent of this Agreement.
8.13 Electronic
Signatures. This Agreement may be executed and delivered by electronic signature (such as .pdf, or Docusign) and upon such delivery
the electronic signature will be deemed to have the same effect as if the original signature had been delivered to the other party.
8.14 Termination
of Agreement. Except for the provisions of Section 1 (Information Rights) and Section 5 (Participation Rights)
of this Agreement which shall terminate upon the consummation of the Company’s IPO of Common Stock pursuant to an effective
registration statement filed under the Securities Act and listing of such Common Stock on a Qualified Securities Market, following the
Company’s IPO, this Agreement and all of the other rights and obligations of the parties hereunder shall continue to survive and
remain in full force and effect. Notwithstanding anything to the contrary herein, this Agreement (excluding any then-existing obligations)
shall terminate upon the Investors ceasing to hold Notes or Conversion Shares or upon the Company ceasing to have more than one Holder.
8.15 Dispute
Resolution. Each party (a) hereby irrevocably and unconditionally submits to the jurisdiction of the federal or state courts located
in Delaware for the purpose of any suit, action or other proceeding arising out of or based upon this Agreement or the Transaction Documents,
(b) agrees not to commence any suit, action or other proceeding arising out of or based upon this Agreement or the Transaction Documents
except in the federal or state courts located in Delaware, and (c) hereby waives and agrees not to assert, by way of motion, as a defense,
or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above-named
courts, that its property is exempt or immune from attachment or execution, that the suit, action or proceeding is brought in an inconvenient
forum, that the venue of the suit, action or proceeding is improper or that this Agreement, the Transaction Documents or the subject matter
hereof and thereof may not be enforced in or by such court.
9. DEFINITIONS. Except as otherwise noted herein, for purposes of this Agreement:
“Affiliate” means, with
respect to any specified Person, any other Person who, directly or indirectly, controls, is controlled by, or is under common
control with such Person, including without limitation any general partner, managing member, officer or director of such Person or
any venture capital fund now or hereafter existing that is controlled by one or more general partners or managing members of, or
shares the same management company with, such Person.
“Common Stock” has the meaning as defined in
the Note.
“Common
Stock Equivalents” shall mean any shares of Common Stock issuable upon conversion of any securities (other than the Notes)
convertible into shares of Common Stock or any warrants or other rights (other than options or restricted stock units issued under the
Company’s Incentive Stock Plan) entitling the holder to purchase Common Stock upon the exercise thereof.
“Conversion
Shares” means (i) the Common Stock issuable or issued upon conversion of the Notes, (ii) any Common Stock issued or
issuable (directly or indirectly) upon conversion and/or exercise of any other securities of the Company, acquired by the Investors
after the date hereof; and (iii) any Common Stock issued as (or issuable upon the conversion or exercise of any warrant, right, or
other security that is issued as) a dividend or other distribution with respect to, or in exchange for or in replacement of, the
shares referenced in clauses (i) and (ii) above; excluding in all cases, however, any Conversion Shares sold by a Person in a
transaction in which the applicable rights under this Agreement are not assigned pursuant to Section 8.7, and excluding for purposes
of Section 5 any shares for which registration rights have terminated pursuant to Section 6.12 of this Agreement.
“Damages”
means any loss, damage, claim or liability (joint or several) to which a party hereto may become subject under the Securities Act,
the Exchange Act, or other federal or state law, insofar as such loss, damage, claim or liability (or any action in respect thereof)
arises out of or is based upon (i) any untrue statement or alleged untrue statement of a material fact contained in any registration
statement of the Company, including any preliminary prospectus or final prospectus contained therein or any amendments or
supplements thereto; (ii) an omission or alleged omission to state therein a material fact required to be stated therein, or
necessary to make the statements therein not misleading; or (iii) any violation or alleged violation by the indemnifying party (or
any of its agents or Affiliates) of the Securities Act, the Exchange Act, any state securities law, or any rule or regulation
promulgated under the Securities Act, the Exchange Act, or any state securities law.
“Exchange Act” means
the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Excluded
Registration” means (i) a registration relating to te sale of securities to employees of the Company or a subsidiary
pursuant to a stock option, stock purchase, or similar plan; (ii) a registration relating to an SEC Rule 145 transaction; (iii) a
registration on any form that does not include substantially the same information as would be required to be included in a
registration statement covering the sale of the Conversion Shares; or (iv) a registration in which the only Common Stock being
registered is Common Stock issuable upon conversion of debt securities that are also being registered.
“Form S-1” means such form under
the Securities Act as in effect on the date hereof or any successor registration form under the Securities Act subsequently adopted by
the SEC.
“Form S-3” means such form
under the Securities Act as in effect on the date hereof or any registration form under the Securities Act subsequently adopted by
the SEC that permits incorporation of substantial information by reference to other documents filed by the Company with the SEC.
“Holder” means collectively, each
Investor owning Notes or Conversion Shares and each Permitted Transferee of such Holder.
“Immediate Family
Member” means a child, stepchild, grandchild, parent, stepparent, grandparent, spouse, sibling, mother-in-law,
father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law, including adoptive relationships, of a natural person
referred to herein.
“Initiating Investors” means, collectively,
Holders who properly initiate a registration request under this Agreement.
“IPO” means
the Company’s first underwritten public offering of its Common stock under the Securities Act.
“New
Securities” means any Common Stock, whether now authorized or not, and rights, options or warrants to purchase such Common
Stock, and securities of any type whatsoever that are, or may become, convertible or exchangeable into such Common Stock that are
issued for cash consideration; provided, however, that the term “New Securities” does not include any (a) New
Securities issued as part of the consideration in connection with any acquisition of the assets or capital stock of any other
Person, or (b) any options or other securities issued pursuant to the Incentive Stock Plan of the Company or any successor in
interest to the Company.
“Person” means any
individual, corporation, partnership, trust, limited liability company, association or other entity.
“Qualified
Securities Market” shall mean any one of the Nasdaq Stock Exchange (including the Nasdaq Capital Market), the NYSE:Amex
Exchange, the New York Stock Exchange or the OTCQX platform of the OTC Markets.
“SEC” means the
Securities and Exchange Commission.
“SEC Rule 144” means Rule 144
promulgated by the SEC under the Securities Act.
“SEC Rule 145” means Rule 145
promulgated by the SEC under the Securities Act.
“Securities Act”
means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Selling Expenses”
means all underwriting discounts, selling commissions, and stock transfer taxes applicable to the sale of Conversion Shares, and fees
and disbursements of counsel for any Holder, except for the fees and disbursements of the Selling Holder Counsel borne and paid by the
Company as provided in Section 6.6.
[Remainder of Page Intentionally
Left Blank]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the day and year first written above.
| THE COMPANY: |
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| SIGNING DAY SPORTS, INC. |
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| By: |
/s/ John Dorsey |
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| Name: |
John Dorsey |
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| Title: |
Chief Executive Officer |
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| Address: |
7272 E. Indian School Road, Suite 101
Scottsdale, Arizona 85251 |
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| Investor: |
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| |
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| /s/ Nelson Revocable Living Trust |
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| Nelson Revocable Living Trust |
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| |
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| |
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| [Name] |
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| |
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| [Name] |
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Grafico Azioni Signing Day Sports (AMEX:SGN)
Storico
Da Ott 2024 a Nov 2024
Grafico Azioni Signing Day Sports (AMEX:SGN)
Storico
Da Nov 2023 a Nov 2024
