NextPlay Technologies, Inc. 8-K


 


Exhibit 10.2


 





 


NextPlay
Technologies, Inc. (f/k/a Monaker Group, Inc.)


 


Promissory
Note


 


	Exchange Date: September 22, 2021	Original Principal Amount: 

U.S. $900,000


 


FOR VALUE RECEIVED,
NextPlay Technologies, Inc. (f/k/a Monaker Group, Inc.), a Nevada corporation (the “Company”), hereby promises to pay
to the order of Hudson Bay Master Fund Ltd., or its registered assigns (“Holder”), the amount set forth above as the
Original Principal Amount (as reduced pursuant to the terms hereof pursuant to redemption or otherwise, the “Principal”) when
due, whether upon the Maturity Date (as defined below), or upon acceleration, redemption or otherwise (in each case in accordance with
the terms hereof) and, upon the occurrence of an Event of Default, to pay interest (“Interest”) on any outstanding
Principal at the applicable Default Rate (as defined below), as applicable, from the date set forth above as the Exchange Date (the “Exchange
Date”) until the same becomes due and payable, whether upon the Maturity Date, or upon acceleration, redemption or otherwise
(in each case in accordance with the terms hereof). This Promissory Note (including all Promissory Notes issued in exchange, transfer
or replacement hereof, this “Note”) was issued pursuant to that certain Exchange Agreement, dated September 22,
2021 (the “Exchange Agreement”), by and between the Company and the Holder, in exchange for a Warrant to Purchase Common
Stock originally issued pursuant to the Securities Purchase Agreement, dated as of September 28, 2018 (the “Subscription Date”),
by and among the Company and the investors referred to therein. The Company hereby represents, and the Holder hereby acknowledges by its
acceptance hereof, that this Note is a “security” under the Securities Act of 1933, as amended. Certain capitalized terms
used herein are defined in Section 24.


 


1.             PAYMENTS OF PRINCIPAL. On each of October 22, 2021, November 22, 2021 and December 22, 2021, the Company shall pay $225,000
of the Outstanding Amount of this Note to the Holder in cash. On the Maturity Date, the Company shall pay to the Holder an amount in cash
representing all remaining outstanding Principal, accrued and unpaid Interest and accrued and unpaid Late Charges (as defined in Section
17(c)) on such Principal and Interest. The Company may prepay all or any portion of the outstanding Principal, accrued and unpaid
Interest or accrued and unpaid Late Charges on Principal and Interest, if any, at any time provided that it provides the Holder at least
5 days prior written notice of such planned prepayment.


 


2.             DEFAULT INTEREST; DEFAULT RATE.


 


(a)           No Interest shall accrue hereunder unless and until an Event of Default (as defined below) has occurred. From and after the
occurrence and during the continuance of any Event of Default, Interest shall accrue hereunder at eighteen percent (18.0%) per annum
(the “Default Rate”) and shall be computed on the basis of a 360-day year and twelve 30-day months, shall compound
each calendar month and shall be payable in arrears on the first Business Day of each such calendar month in which Interest accrues hereunder
(each, an “Interest Date”). Accrued and unpaid Interest, if any, shall also be payable by way of inclusion of such
Interest in the Outstanding Amount (as defined below) upon any redemption in accordance with Section 6 or any required payment upon
any Bankruptcy Event of Default (as defined in Section 3(a) below). In the event that such Event of Default is subsequently cured (and
no other Event of Default then exists (including, without limitation, for the Company’s failure to pay such Interest at the Default
Rate on the applicable Interest Date)), Interest shall cease to accrue hereunder as of the calendar day immediately following the date
of such cure; provided that the Interest as calculated and unpaid during the continuance of such Event of Default shall continue to apply
to the extent relating to the days after the occurrence of such Event of Default through and including the date of such cure of such Event
of Default.


 






     


     


    

 


3.             RIGHTS UPON EVENT OF DEFAULT.


 


(a)           Event of Default. Each of the following events shall constitute an “Event of Default” and each of the
events in clauses (iii), (iv) and (v) shall constitute a “Bankruptcy Event of Default”:


 


(i)           the Company’s or any Subsidiary’s failure to pay to the Holder any amount of Principal, Interest, Late Charges or other
amounts when and as due under this Note (including, without limitation, the Company’s or any Subsidiary’s failure to pay any
redemption payments or amounts hereunder) or any other Transaction Document (as defined in the Securities Purchase Agreement) or
any other agreement, document, certificate or other instrument delivered in connection with the transactions contemplated hereby and thereby,
except, in the case of a failure to pay Interest and Late Charges when and as due, in which case only if such failure remains uncured
for a period of at least two (2) Business Days;


 


(ii)          the occurrence of any default under, redemption of or acceleration prior to maturity of at least an aggregate of $250,000 of Indebtedness
(as defined in the Securities Purchase Agreement) of the Company or any of its Subsidiaries;


 


(iii)         bankruptcy, insolvency, reorganization or liquidation proceedings or other proceedings for the relief of debtors shall be instituted
by or against the Company or any Subsidiary and, if instituted against the Company or any Subsidiary by a third party, shall not be dismissed
within ninety (90) days of their initiation;


 


(iv)         the commencement by the Company or any Subsidiary of a voluntary case or proceeding under any applicable federal, state or foreign
bankruptcy, insolvency, reorganization or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent,
or the consent by it to the entry of a decree, order, judgment or other similar document in respect of the Company or any Subsidiary in
an involuntary case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization or other similar
law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer
or consent seeking reorganization or relief under any applicable federal, state or foreign law, or the consent by it to the filing of
such petition or to the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or any Subsidiary or of any substantial part of its property, or the making by it of an assignment for
the benefit of creditors, or the execution of a composition of debts, or the occurrence of any other similar federal, state or foreign
proceeding, or the admission by it in writing of its inability to pay its debts generally as they become due, the taking of corporate
action by the Company or any Subsidiary in furtherance of any such action or the taking of any action by any Person to commence a Uniform
Commercial Code foreclosure sale or any other similar action under federal, state or foreign law;


 






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(v)          the entry by a court of (i) a decree, order, judgment or other similar document in respect of the Company or any Subsidiary
of a voluntary or involuntary case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization
or other similar law or (ii) a decree, order, judgment or other similar document adjudging the Company or any Subsidiary as bankrupt
or insolvent, or approving as properly filed a petition seeking liquidation, reorganization, arrangement, adjustment or composition of
or in respect of the Company or any Subsidiary under any applicable federal, state or foreign law or (iii) a decree, order, judgment
or other similar document appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the
Company or any Subsidiary or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the
continuance of any such decree, order, judgment or other similar document or any such other decree, order, judgment or other similar document
unstayed and in effect for a period of thirty (30) consecutive days;


 


(vi)         a final judgment or judgments for the payment of money aggregating in excess of $250,00 are rendered against the Company and/or
any of its Subsidiaries and which judgments are not, within thirty (30) days after the entry thereof, bonded, discharged, settled
or stayed pending appeal, or are not discharged within thirty (30) days after the expiration of such stay; provided, however, any
judgment which is covered by insurance or an indemnity from a credit worthy party shall not be included in calculating the $250,000 amount
set forth above so long as the Company provides the Holder a written statement from such insurer or indemnity provider (which written
statement shall be reasonably satisfactory to the Holder) to the effect that such judgment is covered by insurance or an indemnity
and the Company or such Subsidiary (as the case may be) will receive the proceeds of such insurance or indemnity within thirty (30) days
of the issuance of such judgment;


 


(vii)        the Company and/or any Subsidiary, individually or in the aggregate, either (i) fails to pay, when due, or within any applicable
grace period, any payment with respect to any Indebtedness (as defined in the Securities Purchase Agreement) in excess of $250,000
due to any third party (other than, with respect to unsecured Indebtedness only, payments contested by the Company and/or such Subsidiary
(as the case may be) in good faith by proper proceedings and with respect to which adequate reserves have been set aside for the
payment thereof in accordance with GAAP) or is otherwise in breach or violation of any agreement for monies owed or owing in an amount
in excess of $250,000, which breach or violation permits the other party thereto to declare a default or otherwise accelerate amounts
due thereunder, or (ii) suffer to exist any other circumstance or event that would, with or without the passage of time or the giving
of notice, result in a default or event of default under any agreement binding the Company or any Subsidiary, which default or event of
default would or is likely to have a material adverse effect on the business, assets, operations (including results thereof), liabilities,
properties, condition (including financial condition) or prospects of the Company or any of its Subsidiaries, individually or in
the aggregate;


 






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(viii)       other than as specifically set forth in another clause of this Section 3(a), the Company or any Subsidiary breaches any representation
or warranty, or any covenant or other term or condition of any Transaction Document, except, in the case of a breach of a covenant or
other term or condition that is curable, only if such breach remains uncured for a period of two (2) consecutive Business Days;


 


(ix)          any breach or failure in any respect by the Company or any Subsidiary to comply with any provision of Section 8 of this Note;


 


(x)           any Material Adverse Effect (as defined in the Securities Purchase Agreement) occurs; or


 


(xi)          any Change of Control occurs.


 


(b)           Notice of an Event of Default; Redemption Right. Upon the occurrence of an Event of Default with respect to this Note, the
Company shall within two (2) Business Days deliver written notice thereof via facsimile or electronic mail and overnight courier
(with next day delivery specified) (an “Event of Default Notice”) to the Holder. At any time after the earlier
of the Holder’s receipt of an Event of Default Notice and the Holder becoming aware of an Event of Default, the Holder may require
the Company to redeem (regardless of whether such Event of Default has been cured) all or any portion of this Note by delivering
written notice thereof (the “Event of Default Redemption Notice”) to the Company, which Event of Default Redemption
Notice shall indicate the portion of this Note the Holder is electing to redeem. Each portion of this Note subject to redemption by the
Company pursuant to this Section 3(b) shall be redeemed by the Company at a price in cash equal to the product of (A) the Outstanding
Amount to be redeemed multiplied by (B) the Redemption Premium (the “Event of Default Redemption Price”). Redemptions
required by this Section 3(b) shall be made in accordance with the provisions of Section 6. To the extent redemptions required by this
Section 3(b) are deemed or determined by a court of competent jurisdiction to be prepayments of this Note by the Company, such redemptions
shall be deemed to be voluntary prepayments. In the event of the Company’s redemption of any portion of this Note under this Section
3(b), the Holder’s damages would be uncertain and difficult to estimate because of the parties’ inability to predict future
interest rates and the uncertainty of the availability of a suitable substitute investment opportunity for the Holder. Accordingly, any
redemption premium due under this Section 3(b) is intended by the parties to be, and shall be deemed, a reasonable estimate of the Holder’s
actual loss of its investment opportunity and not as a penalty. Any redemption upon an Event of Default shall not constitute an election
of remedies by the Holder, and all other rights and remedies of the Holder shall be preserved.


 






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(c)           Mandatory Redemption upon Bankruptcy Event of Default. Notwithstanding anything to the contrary herein, upon any Bankruptcy
Event of Default, whether occurring prior to or following the Maturity Date, the Company shall immediately pay to the Holder an amount
in cash representing (i) all outstanding Principal, accrued and unpaid Interest and accrued and unpaid Late Charges on such Principal
and Interest, multiplied by (ii) the Redemption Premium, in addition to any and all other amounts due hereunder, without the requirement
for any notice or demand or other action by the Holder or any other person or entity, provided that the Holder may, in its sole discretion,
waive such right to receive payment upon a Bankruptcy Event of Default, in whole or in part, and any such waiver shall not affect any
other rights of the Holder hereunder, including any other rights in respect of such Bankruptcy Event of Default, and any right to payment
of the Event of Default Redemption Price or any other Redemption Price, as applicable.


 


4.             RIGHTS UPON FUNDAMENTAL TRANSACTION.


 


(a)           Assumption. The Company shall not enter into or be party to a Fundamental Transaction unless the Successor Entity assumes
in writing all of the obligations of the Company under this Note and the other Transaction Documents in accordance with the provisions
of this Section 4(a) pursuant to written agreements in form and substance satisfactory to the Required Holders (as defined in the Securities
Purchase Agreement) and approved by the Required Holders prior to such Fundamental Transaction, including agreements to deliver to
each holder of Notes in exchange for such Notes a security of the Successor Entity evidenced by a written instrument substantially similar
in form and substance to the Notes, including, without limitation, having a principal amount and interest rate equal to the principal
amounts then outstanding and the interest rates of the Notes held by such holder, having similar ranking and security to the Notes, and
satisfactory to the Required Holders. Upon the occurrence of any Fundamental Transaction, the Successor Entity shall succeed to, and be
substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Note and the other Transaction
Documents referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power
of the Company and shall assume all of the obligations of the Company under this Note and the other Transaction Documents with the same
effect as if such Successor Entity had been named as the Company herein. The provisions of this Section 4 shall apply similarly and equally
to successive Fundamental Transactions.


 


5.             NONCIRCUMVENTION. The Company hereby covenants and agrees that the Company will not, by amendment of its articles of incorporation,
bylaws or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of
securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Note, and
will at all times in good faith carry out all of the provisions of this Note and take all action as may be required to protect the rights
of the Holder of this Note.


 






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6.             REDEMPTIONS.


 


(a)           Mechanics. The Company shall deliver the applicable Event of Default Redemption Price to the Holder in cash within five
(5) Business Days after the Company’s receipt of the Holder’s Event of Default Redemption Notice. Notwithstanding anything
herein to the contrary, in connection with any redemption hereunder at a time the Holder is entitled to receive a cash payment under any
of the other Transaction Documents, at the option of the Holder delivered in writing to the Company, the applicable Redemption Price hereunder
shall be increased by the amount of such cash payment owed to the Holder under such other Transaction Document and, upon payment in full
in accordance herewith, shall satisfy the Company’s payment obligation under such other Transaction Document. In the event of a
redemption of less than all of the Outstanding Amount of this Note, at the request of the Holder, and upon surrender of this Note to the
Company by the Holder, the Company shall promptly cause to be issued and delivered to the Holder a new Note (in accordance with Section
11(d)) representing the outstanding Principal which has not been redeemed. In the event that the Company does not pay the applicable
Redemption Price to the Holder within the time period required, at any time thereafter and until the Company pays such unpaid Redemption
Price in full, the Holder shall have the option, in lieu of redemption, to require the Company to promptly return to the Holder all or
any portion of this Note representing the Outstanding Amount that was submitted for redemption and for which the applicable Redemption
Price (together with any Late Charges thereon) has not been paid. Upon the Company’s receipt of such notice, (x) the applicable
Redemption Notice shall be null and void with respect to such Outstanding Amount, and (y) the Company shall immediately return this
Note, or issue a new Note (in accordance with Section 11(d)), to the Holder, and in each case the principal amount of this Note or
such new Note (as the case may be) shall be increased by an amount equal to the difference between (1) the applicable Redemption
Price (as the case may be, and as adjusted pursuant to this Section 6, if applicable) minus (2) the Principal portion of the
Outstanding Amount submitted for redemption. The Holder’s delivery of a notice voiding a Redemption Notice and exercise of its rights
following such notice shall not affect the Company’s obligations to make any payments of Late Charges which have accrued prior to
the date of such notice with respect to the Outstanding Amount subject to such notice.


 


7.             VOTING RIGHTS. The Holder shall have no voting rights as the holder of this Note, except as required by law and as expressly
provided in this Note.


 


8.             COVENANTS. Until this Note has been redeemed or otherwise satisfied in accordance with its terms:


 


(a)           Restricted Payments. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly,
except in connection with the Excepted Payments, redeem, defease, repurchase, repay or make any payments in respect of, by the payment
of cash or cash equivalents (in whole or in part, whether by way of open market purchases, tender offers, private transactions or otherwise),
all or any portion of any Indebtedness (other than the Notes) whether by way of payment in respect of principal of (or premium, if
any) or interest on, such Indebtedness if at the time such payment is due or is otherwise made or, after giving effect to such payment,
(i) an event constituting an Event of Default has occurred and is continuing or (ii) an event that with the passage of time
and without being cured would constitute an Event of Default has occurred and is continuing.


 






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(b)           Preservation of Existence, Etc. The Company shall maintain and preserve, and cause each of its Subsidiaries to maintain
and preserve, its existence, rights and privileges, and become or remain, and cause each of its Subsidiaries to become or remain, duly
qualified and in good standing in each jurisdiction in which the character of the properties owned or leased by it or in which the transaction
of its business makes such qualification necessary, except in each case where the failure to be so qualified could not be reasonably expected
to have a Material Adverse Effect.


 


(c)           Independent Investigation. At the request of the Holder either (x) at any time when an Event of Default has occurred
and is continuing, (y) upon the occurrence of an event that with the passage of time or giving of notice would constitute an Event
of Default or (z) at any time the Holder reasonably believes an Event of Default may have occurred or be continuing, and has provided
notice to the Company of such belief, the Company shall hire an independent, reputable investment bank selected by the Company and approved
by the Holder to investigate as to whether any breach of this Note has occurred (the “Independent Investigator”). If
the Independent Investigator determines that such breach of this Note has occurred, the Independent Investigator shall notify the Company
of such breach and the Company shall deliver written notice to each holder of a Note of such breach. In connection with such investigation,
the Independent Investigator may, during normal business hours and upon reasonable notice, inspect all contracts, books, records, personnel,
offices and other facilities and properties of the Company and its Subsidiaries and, to the extent available to the Company after the
Company uses reasonable efforts to obtain them, the records of its legal advisors and accountants (including the accountants’ work
papers) and any books of account, records, reports and other papers not contractually required of the Company to be confidential
or secret, or subject to attorney-client or other evidentiary privilege, and the Independent Investigator may make such copies and inspections
thereof as the Independent Investigator may reasonably request. The Company shall furnish the Independent Investigator with such financial
and operating data and other information with respect to the business and properties of the Company as the Independent Investigator may
reasonably request. The Company shall permit the Independent Investigator to discuss the affairs, finances and accounts of the Company
with, and to make proposals and furnish advice with respect thereto to, the Company’s officers, directors, key employees and independent
public accountants or any of them (and by this provision the Company authorizes said accountants to discuss with such Independent Investigator
the finances and affairs of the Company and any Subsidiaries), all at such reasonable times, upon reasonable notice, and as often as may
be reasonably requested.


 


9.             AMENDING THE TERMS OF THIS NOTE. The prior written consent of the Holder shall be required for any change, waiver or amendment
to this Note.


 


10.           TRANSFER. This Note may be offered, sold, assigned or transferred by the Holder without the consent of the Company.


 






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11.           REISSUANCE OF THIS NOTE.


 


(a)           Transfer. If this Note is to be transferred, the Holder shall surrender this Note to the Company, whereupon the Company
will forthwith issue and deliver upon the order of the Holder a new Note (in accordance with Section 11(d)), registered as the Holder
may request, representing the outstanding Principal being transferred by the Holder and, if less than the entire outstanding Principal
is being transferred, a new Note (in accordance with Section 11(d)) to the Holder representing the outstanding Principal not being
transferred. The Holder and any assignee, by acceptance of this Note, acknowledge and agree that, following redemption of any portion
of this Note, the outstanding Principal represented by this Note may be less than the Principal stated on the face of this Note.


 


(b)           Lost, Stolen or Mutilated Note. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss,
theft, destruction or mutilation of this Note (as to which a written certification and the indemnification contemplated below shall suffice
as such evidence), and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Company in
customary and reasonable form and, in the case of mutilation, upon surrender and cancellation of this Note, the Company shall execute
and deliver to the Holder a new Note (in accordance with Section 11(d)) representing the outstanding Principal.


 


(c)           Note Exchangeable for Different Denominations. This Note is exchangeable, upon the surrender hereof by the Holder at the
principal office of the Company, for a new Note or Notes (in accordance with Section 11(d) and in principal amounts of at least $1,000) representing
in the aggregate the outstanding Principal of this Note, and each such new Note will represent such portion of such outstanding Principal
as is designated by the Holder at the time of such surrender.


 


(d)           Issuance of New Notes. Whenever the Company is required to issue a new Note pursuant to the terms of this Note, such new
Note (i) shall be of like tenor with this Note, (ii) shall represent, as indicated on the face of such new Note, the Principal
remaining outstanding (or in the case of a new Note being issued pursuant to Section 11(a) or Section 11(c), the Principal designated
by the Holder which, when added to the principal represented by the other new Notes issued in connection with such issuance, does not
exceed the Principal remaining outstanding under this Note immediately prior to such issuance of new Notes), (iii) shall have an
issuance date, as indicated on the face of such new Note, which is the same as the Exchange Date of this Note, (iv) shall have the
same rights and conditions as this Note, and (v) shall represent accrued and unpaid Interest and Late Charges on the Principal and
Interest of this Note, from the Exchange Date.


 






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12.           REMEDIES, CHARACTERIZATIONS, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in this Note shall
be cumulative and in addition to all other remedies available under this Note and any of the other Transaction Documents at law or in
equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the Holder’s
right to pursue actual and consequential damages for any failure by the Company to comply with the terms of this Note. No failure on the
part of the Holder to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise by the Holder of any right, power or remedy preclude any other or further exercise thereof or the
exercise of any other right, power or remedy. In addition, the exercise of any right or remedy of the Holder at law or equity or under
this Note or any of the documents shall not be deemed to be an election of Holder’s rights or remedies under such documents or at
law or equity. The Company covenants to the Holder that there shall be no characterization concerning this instrument other than as expressly
provided herein. Amounts set forth or provided for herein with respect to payments, redemptions and the like (and the computation thereof) shall
be the amounts to be received by the Holder and shall not, except as expressly provided herein, be subject to any other obligation of
the Company (or the performance thereof). The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable
harm to the Holder and that the remedy at law for any such breach may be inadequate. The Company therefore agrees that, in the event of
any such breach or threatened breach, the Holder shall be entitled, in addition to all other available remedies, to specific performance
and/or temporary, preliminary and permanent injunctive or other equitable relief from any court of competent jurisdiction in any such
case without the necessity of proving actual damages and without posting a bond or other security. Subject to applicable restrictions
pertaining to confidentiality and applicable law, and execution of a customary non-disclosure agreement by the Holder, the Company shall
provide all information and documentation to the Holder that is reasonably requested by the Holder to enable the Holder to confirm the
Company’s compliance with the terms and conditions of this Note.


 


13.           PAYMENT OF COLLECTION, ENFORCEMENT AND OTHER COSTS. If (a) this Note is placed in the hands of an attorney for collection
or enforcement or is collected or enforced through any legal proceeding or the Holder otherwise takes action to collect amounts due under
this Note or to enforce the provisions of this Note or (b) there occurs any bankruptcy, reorganization, receivership of the
Company or other proceedings affecting Company creditors’ rights and involving a claim under this Note, then the Company shall pay
the reasonable costs incurred by the Holder for such collection, enforcement or action or in connection with such bankruptcy, reorganization,
receivership or other proceeding, including, without limitation, reasonable attorneys’ fees and disbursements. The Company expressly
acknowledges and agrees that no amounts due under this Note shall be affected, or limited, by the fact that the purchase price paid for
this Note was less than the original Principal amount hereof.


 


14.           CONSTRUCTION; HEADINGS. This Note shall be deemed to be jointly drafted by the Company and the initial Holder and shall
not be construed against any such Person as the drafter hereof. The headings of this Note are for convenience of reference and shall not
form part of, or affect the interpretation of, this Note. Unless the context clearly indicates otherwise, each pronoun herein shall be
deemed to include the masculine, feminine, neuter, singular and plural forms thereof. The terms “including,” “includes,”
“include” and words of like import shall be construed broadly as if followed by the words “without limitation.”
The terms “herein,” “hereunder,” “hereof” and words of like import refer to this entire Note instead
of just the provision in which they are found. Unless expressly indicated otherwise, all section references are to sections of this Note.
Terms used in this Note and not otherwise defined herein, but defined in the other Transaction Documents, shall have the meanings ascribed
to such terms on the Closing Date in such other Transaction Documents, except as amended by the Exchange Agreement, and unless otherwise
consented to in writing by the Holder.


 






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15.           FAILURE OR INDULGENCE NOT WAIVER. No failure or delay on the part of the Holder in the exercise of any power, right or privilege
hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other
or further exercise thereof or of any other right, power or privilege. No waiver shall be effective unless it is in writing and signed
by an authorized representative of the waiving party.


 


16.           DISPUTE RESOLUTION.


 


(a)           Submission to Dispute Resolution.


 


(i)            In the case of a dispute relating to a fair market value or the arithmetic calculation of the applicable Redemption Price (as the
case may be) (including, without limitation, a dispute relating to the determination of any of the foregoing), the Company or the
Holder (as the case may be) shall submit the dispute to the other party via facsimile or electronic mail (A) if by the Company,
within two (2) Business Days after the occurrence of the circumstances giving rise to such dispute or (B) if by the Holder at
any time after the Holder learned of the circumstances giving rise to such dispute. If the Holder and the Company are unable to promptly
resolve such dispute relating to such fair market value, or the arithmetic calculation of such applicable Redemption Price (as the case
may be), at any time after the second (2nd) Business Day following such initial notice by the Company or the Holder (as
the case may be) of such dispute to the Company or the Holder (as the case may be), then the Holder may, at its sole option, select
an independent, reputable investment bank to resolve such dispute.


 


(ii)           The Holder and the Company shall each deliver to such investment bank (A) a copy of the initial dispute submission so delivered
in accordance with the first sentence of this Section 16 and (B) written documentation supporting its position with respect to such
dispute, in each case, no later than 5:00 p.m. (New York time) by the fifth (5th) Business Day immediately following
the date on which the Holder selected such investment bank (the “Dispute Submission Deadline”) (the documents
referred to in the immediately preceding clauses (A) and (B) are collectively referred to herein as the “Required Dispute
Documentation”) (it being understood and agreed that if either the Holder or the Company fails to so deliver all of the
Required Dispute Documentation by the Dispute Submission Deadline, then the party who fails to so submit all of the Required Dispute Documentation
shall no longer be entitled to (and hereby waives its right to) deliver or submit any written documentation or other support to such
investment bank with respect to such dispute and such investment bank shall resolve such dispute based solely on the Required Dispute
Documentation that was delivered to such investment bank prior to the Dispute Submission Deadline). Unless otherwise agreed to in writing
by both the Company and the Holder or otherwise requested by such investment bank, neither the Company nor the Holder shall be entitled
to deliver or submit any written documentation or other support to such investment bank in connection with such dispute (other than the
Required Dispute Documentation).


 






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(iii)         The Company and the Holder shall cause such investment bank to determine the resolution of such dispute and notify the Company
and the Holder of such resolution no later than ten (10) Business Days immediately following the Dispute Submission Deadline. The
fees and expenses of such investment bank shall be borne solely by the Company, and such investment bank’s resolution of such dispute
shall be final and binding upon all parties absent manifest error.


 


(b)           Miscellaneous. The Company expressly acknowledges and agrees that (i) this Section 16 constitutes an agreement to arbitrate
between the Company and the Holder (and constitutes an arbitration agreement) under § 7501, et seq. of the New York Civil Practice
Law and Rules (“CPLR”) and that the Holder is authorized to apply for an order to compel arbitration pursuant
to CPLR § 7503(a) in order to compel compliance with this Section 16, (ii) the terms of this Note and each other applicable
Transaction Document shall serve as the basis for the selected investment bank’s resolution of the applicable dispute, such investment
bank shall be entitled (and is hereby expressly authorized) to make all findings, determinations and the like that such investment
bank determines are required to be made by such investment bank in connection with its resolution of such dispute and in resolving such
dispute such investment bank shall apply such findings, determinations and the like to the terms of this Note and any other applicable
Transaction Documents, (iii) the Holder (and only the Holder), in its sole discretion, shall have the right to submit any dispute
described in this Section 16 to any state or federal court sitting in The City of New York, Borough of Manhattan in lieu of utilizing
the procedures set forth in this Section 16 and (iv) nothing in this Section 16 shall limit the Holder from obtaining any injunctive
relief or other equitable remedies (including, without limitation, with respect to any matters described in this Section 16).


 


17.           NOTICES; CURRENCY; PAYMENTS.


 


(a)           Notices. Whenever notice is required to be given under this Note, unless otherwise provided herein, such notice shall be
given in accordance with Section 13(d) of the Exchange Agreement. The Company shall provide the Holder with prompt written notice
of all actions taken pursuant to this Note, including in reasonable detail a description of such action and the reason therefore.


 


(b)           Currency. All dollar amounts referred to in this Note are in United States Dollars (“U.S. Dollars”),
and all amounts owing under this Note shall be paid in U.S. Dollars. All amounts denominated in other currencies (if any) shall be
converted into the U.S. Dollar equivalent amount in accordance with the Exchange Rate on the date of calculation. “Exchange Rate”
means, in relation to any amount of currency to be converted into U.S. Dollars pursuant to this Note, the U.S. Dollar exchange rate as
published in the Wall Street Journal on the relevant date of calculation (it being understood and agreed that where an amount is calculated
with reference to, or over, a period of time, the date of calculation shall be the final date of such period of time).


 






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(c)           Payments. Whenever any payment of cash is to be made by the Company to any Person pursuant to this Note, unless otherwise
expressly set forth herein, such payment shall be made in lawful money of the United States of America by a certified check drawn on the
account of the Company and sent via overnight courier service to such Person at such address as previously provided to the Company in
writing (which address shall initially be as set forth in the Exchange Agreement), provided that the Holder may elect to receive a payment
of cash via wire transfer of immediately available funds by providing the Company with prior written notice setting out such request and
the Holder’s wire transfer instructions. Whenever any amount expressed to be due by the terms of this Note is due on any day which
is not a Business Day, the same shall instead be due on the next succeeding day which is a Business Day. Any amount of Principal or other
amounts due under the Transaction Documents which is not paid when due (except to the extent such amount is simultaneously accruing Interest
at the Default Rate hereunder) shall result in a late charge being incurred and payable by the Company in an amount equal to interest
on such amount at the rate of eighteen percent (18%) per annum from the date such amount was due until the same is paid in full (“Late
Charge”).


 


18.           CANCELLATION. After all Principal, accrued Interest, Late Charges and other amounts at any time owed on this Note have been
paid in full, this Note shall automatically be deemed canceled, shall be surrendered to the Company for cancellation and shall not be
reissued.


 


19.           WAIVER OF NOTICE. To the extent permitted by law, the Company hereby irrevocably waives demand, notice, presentment, protest
and all other demands and notices in connection with the delivery, acceptance, performance, default or enforcement of this Note and the
Securities Purchase Agreement.


 


20.           GOVERNING LAW. This Note shall be construed and enforced in accordance with, and all questions concerning the construction,
validity, interpretation and performance of this Note shall be governed by, the internal laws of the State of New York, without giving
effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that
would cause the application of the laws of any jurisdictions other than the State of New York. Except as otherwise required by Section
16 above, the Company hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City of
New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated
hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that
it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient
forum or that the venue of such suit, action or proceeding is improper. Nothing contained herein shall be deemed to limit in any way any
right to serve process in any manner permitted by law. Nothing contained herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law. Nothing contained herein (i) shall be deemed or operate to preclude the Holder from bringing
suit or taking other legal action against the Company in any other jurisdiction to collect on the Company’s obligations to the Holder,
to realize on any collateral or any other security for such obligations, or to enforce a judgment or other court ruling in favor of the
Holder or (ii) shall limit, or shall be deemed or construed to limit, any provision of Section 16. THE COMPANY HEREBY IRREVOCABLY
WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION
WITH OR ARISING OUT OF THIS NOTE OR ANY TRANSACTION CONTEMPLATED HEREBY.


 






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21.           JUDGMENT CURRENCY.


 


(a)           If for the purpose of obtaining or enforcing judgment against the Company in any court in any jurisdiction it becomes necessary
to convert into any other currency (such other currency being hereinafter in this Section 21 referred to as the “Judgment Currency”) an
amount due in U.S. dollars under this Note, the conversion shall be made at the Exchange Rate prevailing on the Business Day immediately
preceding:


 


(i)           the date actual payment of the amount due, in the case of any proceeding in the courts of New York or in the courts of any other
jurisdiction that will give effect to such conversion being made on such date: or


 


(ii)          the date on which the foreign court determines, in the case of any proceeding in the courts of any other jurisdiction (the date
as of which such conversion is made pursuant to this Section 21(a)(ii) being hereinafter referred to as the “Judgment Conversion
Date”).


 


(b)           If in the case of any proceeding in the court of any jurisdiction referred to in Section 21(a)(ii) above, there is a change in
the Exchange Rate prevailing between the Judgment Conversion Date and the date of actual payment of the amount due, the applicable party
shall pay such adjusted amount as may be necessary to ensure that the amount paid in the Judgment Currency, when converted at the Exchange
Rate prevailing on the date of payment, will produce the amount of US dollars which could have been purchased with the amount of Judgment
Currency stipulated in the judgment or judicial order at the Exchange Rate prevailing on the Judgment Conversion Date.


 


(c)           Any amount due from the Company under this provision shall be due as a separate debt and shall not be affected by judgment being
obtained for any other amounts due under or in respect of this Note.


 


22.           SEVERABILITY. If any provision of this Note is prohibited by law or otherwise determined to be invalid or unenforceable
by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended
to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall
not affect the validity of the remaining provisions of this Note so long as this Note as so modified continues to express, without material
change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability
of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties
or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good faith
negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes
as close as possible to that of the prohibited, invalid or unenforceable provision(s).


 


23.           MAXIMUM PAYMENTS. Nothing contained herein shall be deemed to establish or require the payment of a rate of interest or
other charges in excess of the maximum permitted by applicable law. In the event that the rate of interest required to be paid or other
charges hereunder exceed the maximum permitted by such law, any payments in excess of such maximum shall be credited against amounts owed
by the Company to the Holder and thus refunded to the Company.


 






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24.           CERTAIN DEFINITIONS. For purposes of this Note, the following terms shall have the following meanings:


 


(a)           “Affiliate” means, with respect to any Person, any other Person that directly or indirectly controls, is controlled
by, or is under common control with, such Person, it being understood for purposes of this definition that “control” of a
Person means the power directly or indirectly either to vote 10% or more of the stock having ordinary voting power for the election of
directors of such Person or direct or cause the direction of the management and policies of such Person whether by contract or otherwise.


 


(b)           “Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City
of New York are authorized or required by law to remain closed; provided, however,
for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to “stay at home”,
“shelter-in-place”, “non-essential employee”  or any other similar orders or restrictions or the closure
of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems (including
for wire transfers) of commercial banks in The City of New York generally are open for use by customers on such day.


 


(c)           “Change of Control” means any Fundamental Transaction other than (i) any merger of the Company or any of
its, direct or indirect, wholly-owned Subsidiaries with or into any of the foregoing Persons, (ii) any reorganization, recapitalization
or reclassification of the shares of Common Stock (as defined in the Securities Purchase Agreement) in which holders of the Company’s
voting power immediately prior to such reorganization, recapitalization or reclassification continue after such reorganization, recapitalization
or reclassification to hold publicly traded securities and, directly or indirectly, are, in all material respects, the holders of the
voting power of the surviving entity (or entities with the authority or voting power to elect the members of the board of directors
(or their equivalent if other than a corporation) of such entity or entities) after such reorganization, recapitalization or
reclassification, or (iii) pursuant to a migratory merger effected solely for the purpose of changing the jurisdiction of incorporation
of the Company or any of its Subsidiaries.


 


(d)           “Closing Date” shall have the meaning set forth in the Securities Purchase Agreement, which date is the date
the Company initially issued Notes pursuant to the terms of the Securities Purchase Agreement.


 


(e)           “Excepted Payments” means payments to, redemptions from, and repurchases from, IDS, Inc. pursuant to those that
certain May 18, 2021 Amendment to Intellectual Property Purchase Agreement between the Company, IDS, Inc., Ari Daniels and TD Assets Holding,
LLC and/or that certain Confidential Settlement Agreement and Mutual Release dated May 18, 2021 between the Company, IDS, Inc., Ari Daniels
and TD Assets Holding, LLC, as in effect as of the date hereof and without regard to any subsequent amendment, modifications or waiver
thereof; and/or repayments of amounts owed to Streeterville Capital, LLC from time to time pursuant to agreements or instruments in effect
as of the date hereof and without regard to any subsequent amendment, modifications or waiver thereof.


 






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(f)            “Fundamental Transaction” means (A) that the Company shall, directly or indirectly, including through subsidiaries,
Affiliates or otherwise, in one or more related transactions, (i) consolidate or merge with or into (whether or not the Company is
the surviving corporation) another Subject Entity, or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially
all of the properties or assets of the Company or any of its “significant subsidiaries” (as defined in Rule 1-02 of Regulation
S-X) to one or more Subject Entities, or (iii) make, or allow one or more Subject Entities to make, or allow the Company to
be subject to or have its Common Stock be subject to or party to one or more Subject Entities making, a purchase, tender or exchange offer
that is accepted by the holders of at least either (x) 50% of the outstanding shares of Common Stock, (y) 50% of the outstanding
shares of Common Stock calculated as if any shares of Common Stock held by all Subject Entities making or party to, or Affiliated with
any Subject Entities making or party to, such purchase, tender or exchange offer were not outstanding; or (z) such number of shares
of Common Stock such that all Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such purchase,
tender or exchange offer, become collectively the beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of at least 50%
of the outstanding shares of Common Stock, or (iv) consummate a stock or share purchase agreement or other business combination (including,
without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with one or more Subject Entities whereby
all such Subject Entities, individually or in the aggregate, acquire, either (x) at least 50% of the outstanding shares of Common
Stock, (y) at least 50% of the outstanding shares of Common Stock calculated as if any shares of Common Stock held by all the Subject
Entities making or party to, or Affiliated with any Subject Entity making or party to, such stock purchase agreement or other business
combination were not outstanding; or (z) such number of shares of Common Stock such that the Subject Entities become collectively
the beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of at least 50% of the outstanding shares of Common Stock, or
(v) reorganize, recapitalize or reclassify its Common Stock, (B) that the Company shall, directly or indirectly, including through
subsidiaries, Affiliates or otherwise, in one or more related transactions, allow any Subject Entity individually or the Subject Entities
in the aggregate to be or become the “beneficial owner” (as defined in Rule 13d-3 under the 1934 Act), directly or indirectly,
whether through acquisition, purchase, assignment, conveyance, tender, tender offer, exchange, reduction in outstanding shares of Common
Stock, merger, consolidation, business combination, reorganization, recapitalization, spin-off, scheme of arrangement, reorganization,
recapitalization or reclassification or otherwise in any manner whatsoever, of either (x) at least 50% of the aggregate ordinary
voting power represented by issued and outstanding Common Stock, (y) at least 50% of the aggregate ordinary voting power represented
by issued and outstanding Common Stock not held by all such Subject Entities as of the date of this Note calculated as if any shares of
Common Stock held by all such Subject Entities were not outstanding, or (z) a percentage of the aggregate ordinary voting power represented
by issued and outstanding shares of Common Stock or other equity securities of the Company sufficient to allow such Subject Entities to
effect a statutory short form merger or other transaction requiring other stockholders of the Company to surrender their shares of Common
Stock without approval of the stockholders of the Company or (C) directly or indirectly, including through subsidiaries, Affiliates
or otherwise, in one or more related transactions, the issuance of or the entering into any other instrument or transaction structured
in a manner to circumvent, or that circumvents, the intent of this definition in which case this definition shall be construed and implemented
in a manner otherwise than in strict conformity with the terms of this definition to the extent necessary to correct this definition or
any portion of this definition which may be defective or inconsistent with the intended treatment of such instrument or transaction.


 






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(g)           “GAAP”
means United States generally accepted accounting principles, consistently applied.


 


(h)           “Group”
means a “group” as that term is used in Section 13(d) of the 1934 Act and as defined in Rule 13d-5 thereunder.


 


(i)            “Maturity
Date” shall mean January 22, 2022; provided, however, the Maturity Date may be extended at the option of the Holder (i) in
the event that, and for so long as, an Event of Default shall have occurred and be continuing or any event shall have occurred and be
continuing that with the passage of time and the failure to cure would result in an Event of Default or (ii) through the date that
is twenty (20) Business Days after the consummation of a Fundamental Transaction in the event that a Fundamental Transaction is
publicly announced or an Event of Default Redemption Notice is delivered prior to the Maturity Date.


 


(j)            “Outstanding Amount” means the sum of (A) the portion of the Principal to be redeemed or otherwise with
respect to which this determination is being made, (B) accrued and unpaid Interest with respect to such Principal and (C) accrued
and unpaid Late Charges with respect to such Principal and Interest.


 


(k)           “Parent
Entity” of a Person means an entity that, directly or indirectly, controls the applicable Person and whose common stock or
equivalent equity security is quoted or listed on an Eligible Market (as defined in the Securities Purchase Agreement), or, if there
is more than one such Person or Parent Entity, the Person or Parent Entity with the largest public market capitalization as of the date
of consummation of the Fundamental Transaction.


 


(l)            “Person”
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization,
any other entity or a government or any department or agency thereof.


 


(m)          “Redemption Notices” means, collectively, the Event of Default Redemption Notices, and each of the foregoing,
individually, a “Redemption Notice.”


 


(n)           “Redemption Premium” means 125%.


 


(o)           “Redemption Prices” means, collectively, Event of Default Redemption Prices and each of the foregoing, individually,
a “Redemption Price.”


 






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(p)           “SEC”
means the United States Securities and Exchange Commission or the successor thereto.


 


(q)           “Subsidiaries” shall have the meaning as set forth in the Securities Purchase Agreement.


 


(r)            “Subject Entity” means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons
or Group.


 


(s)           “Successor
Entity” means the Person (or, if so elected by the Holder, the Parent Entity) formed by, resulting from or surviving any
Fundamental Transaction or the Person (or, if so elected by the Holder, the Parent Entity) with which such Fundamental Transaction
shall have been entered into.


 


25.           DISCLOSURE. Upon delivery by the Company to the Holder (or receipt by the Company from the Holder) of any notice in
accordance with the terms of this Note, unless the Company has in good faith determined that the matters relating to such notice do not
constitute material, non-public information relating to the Company or any of its Subsidiaries, the Company shall on or prior to 9:00
am, New York city time on the Business Day immediately following such notice delivery date, publicly disclose such material, non-public
information on a Current Report on Form 8-K or otherwise. In the event that the Company believes that a notice contains material, non-public
information relating to the Company or any of its Subsidiaries, the Company so shall indicate to the Holder explicitly in writing in such
notice (or immediately upon receipt of notice from the Holder, as applicable), and in the absence of any such written indication in such
notice (or notification from the Company immediately upon receipt of notice from the Holder), the Holder shall be entitled to presume
that information contained in the notice does not constitute material, non-public information relating to the Company or any of its Subsidiaries.


 


26.           ABSENCE OF TRADING AND DISCLOSURE RESTRICTIONS. The Company acknowledges and agrees that the Holder is not a fiduciary or
agent of the Company and that the Holder shall have no obligation to (a) maintain the confidentiality of any information provided
by the Company or (b) refrain from trading any securities while in possession of such information in the absence of a written non-disclosure
agreement signed by an officer of the Holder that explicitly provides for such confidentiality and trading restrictions. In the absence
of such an executed, written non-disclosure agreement, the Company acknowledges that the Holder may freely trade in any securities issued
by the Company, may possess and use any information provided by the Company in connection with such trading activity, and may disclose
any such information to any third party.


 


[signature page follows]


 




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IN WITNESS WHEREOF, the Company
has caused this Note to be duly executed as of the Exchange Date set out above. 


 


	
    NEXTPLAY TECHNOLOGIES, INC. (F/K/A MONAKER GROUP, INC.) 

	 
	 
	By:	/s/ Bill Kerby	 
	 	Name: Bill Kerby	 
	 	Title: Co-CEO