Company: LTRYW
Filing Date: 2025-05-21
Form Type: 10-Q
Source: 0001641172-25-011865
Chunk: 40

Company: Lottery.com Inc.
Filing Date: 2025-05-21
Form: 10-Q
Item: Part I, Item 2
Chunk 40
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 loan agreement with Woodford Eurasia Assets, Ltd. (“ Woodford”), (the “ Woodford
Loan Agreement”) pursuant to which Woodford agreed to provide the Company with up to $52.5 million, subject to certain conditions
and requirements, of which, per the Company’s books and records $798,351 was received by December 31, 2023 and is owed pursuant
to the terms of the Woodford Loan Agreement. Amounts borrowed accrue interest at the rate of 12% per annum (or 22% per annum upon the
occurrence of an event of default) and are due within 12 months of the date of each loan advance. Amounts borrowed can be repaid at any
time without penalty.

Amounts
borrowed pursuant to the Woodford Loan Agreement are convertible, at Woodford’s option, into shares of the Company’s common
stock, beginning 60 days after the first loan date at the rate of 80% of the lowest publicly available price per share of common stock
within 10 business days of the date of the Loan Agreement (which was equal to $5.60 per share), subject to a 4.99% beneficial ownership
limitation and a separate limitation preventing Woodford from holding more than 19.99% of the issued and outstanding common stock of
the Company, without the Company obtaining shareholder approval for such issuance.

Conditions
to the Loan Agreement included the resignation of four prior members of the Board (Lisa Borders, Steven M. Cohen, Lawrence Anthony DiMatteo
and William Thompson, all of whom resigned from the Board in September 2022), and the appointment of two new independent directors. Subsequent
loans under the Woodford Loan Agreement also require the Company to comply with all listing requirements, unless waived by Woodford.
The Woodford Loan Agreement also allows Woodford to nominate another director to the Board of Directors, in the event any independent
member of the Board of Directors resigns.

Proceeds
of the loans can only be used by to restart the Company’s operations and for general corporate purposes agreed to by Woodford.

The
Woodford Loan Agreement includes confidentiality obligations, representations, warranties, covenants, and events of default, which are
customary for a transaction of this size and nature. Included in the Loan Agreement are covenants prohibiting us from (a) making any
loan in excess of $1 million or obtaining any loan in an amount exceeding $1 million without the consent of Wood