UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
SCHEDULE
14A INFORMATION
Proxy
Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed
by the Registrant ☒
Filed
by a Party other than the Registrant ☐
Check
the appropriate box:
☒
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Preliminary
Proxy Statement
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☐
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Confidential,
For Use of the Commission Only (As Permitted by Rule 14a-6(e)(2))
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☐
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Definitive
Proxy Statement
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Definitive
Additional Materials
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☐
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Soliciting
Material under Rule 14a-12
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NEXTPLAY
TECHNOLOGIES, INC.
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(Name
of Registrant as Specified In Its Charter)
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(Name
of Person(s) Filing Proxy Statement, if other than the Registrant)
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Payment
of Filing Fee (Check the appropriate box):
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
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(1)
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Title
of each class of securities to which transaction applies:
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(2)
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Aggregate
number of securities to which transaction applies:
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(3)
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Per
unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11
(set forth the amount on which the filing fee is calculated and state how it was determined):
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(4)
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Proposed
maximum aggregate value of transaction:
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☐ Fee
paid previously with preliminary materials.
☐ Check
box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing.
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(1)
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Amount
Previously Paid:
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(2)
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Form,
Schedule or Registration Statement No.:
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PRELIMINARY
PROXY MATERIALS SUBJECT TO COMPLETION DATED DECEMBER 21, 2021
1560
Sawgrass Corporate Parkway, Suite 130
Sunrise,
Florida 33323
(954)
888-9779
December
[__], 2021
Dear
Stockholder:
The
board of directors (“Board”) and officers of NextPlay Technologies, Inc., a Nevada corporation, join me in extending to you
a cordial invitation to attend the special meeting of our stockholders (the “Meeting”) to be held on January 28, 2022 at 9:00 a.m. Eastern Time (subject to postponement(s) or adjournment(s) thereof). The Meeting will be held virtually via live audio webcast
at https://agm.issuerdirect.com/nxtp (please note this link is case sensitive). For further information
about the virtual Meeting, please see the Questions and Answers about the Meeting beginning on page 1 of the accompanying Proxy
Statement.
Enclosed
is our Proxy Statement that describes the matters to be presented to stockholders at the Meeting, as well as a proxy card. Please give
this information your careful attention. Whether or not you attend the Meeting, it is important that your shares be represented and voted.
You may submit your vote on the Internet, by telephone or by mail. If you are a registered holder, that is, a stockholder who holds shares
of our common stock in your own name, you may also vote by mail by completing, dating and signing the enclosed proxy card and returning
it in the enclosed, postage-paid envelope. If you decide to attend the virtual Meeting, you will also be able to submit your votes, as
well as any questions that you may have, during the Meeting through the designated website, even if you have previously submitted your
proxy. Voting at the Meeting will supersede any votes previously cast.
Our
Board has unanimously approved the proposals set forth in the Proxy Statement and we recommend that you vote in favor of each such proposal.
We
look forward to seeing you on January 28, 2022. Your vote and participation in our governance is very important to us.
Sincerely,
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John Todd
Bonner
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Chairman
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PRELIMINARY
PROXY MATERIALS SUBJECT TO COMPLETION DATED DECEMBER 21, 2021
1560
Sawgrass Corporate Parkway, Suite 130
Sunrise,
Florida 33323
(954)
888-9779
NOTICE
OF SPECIAL MEETING OF STOCKHOLDERS
TO
BE HELD ON JANUARY 28, 2022
To
the Stockholders of NextPlay Technologies, Inc.:
We
are pleased to provide you notice of, and to invite you to attend, the special meeting (the “Meeting”) of the stockholders
of NextPlay Technologies, Inc., a Nevada corporation (“NextPlay,” the “Company,” “we,” and “us”),
which will be held on January 28, 2022 at 9:00 a.m. Eastern Time (subject to postponement(s) or adjournment(s) thereof). The Meeting
will be held virtually via live audio webcast at https://agm.issuerdirect.com/nxtp (please note this link
is case sensitive). See also “Instructions for the Virtual Meeting,” beginning on page 1 of the enclosed Proxy Statement
for additional information regarding attending the virtual Meeting. The Meeting is being held for the following purposes:
1.
To consider and vote upon a proposal to approve the issuance of 1,250,000 shares of
the Company’s common stock as consideration for the purchase of certain intellectual property of Token IQ Inc., an entity owned
and controlled by Mark Vange, the Company’s Chief Technology Officer.
2. To
consider and vote upon a proposal to approve the issuance of 1,666,667 shares of the
Company’s common stock as consideration for the purchase of certain intellectual property of Fighter Base Publishing Inc., an entity
owned and controlled by Mark Vange, the Company’s Chief Technology Officer.
3. To
consider and vote upon a proposal to approve, in accordance with Nasdaq Listing Rule 5635(d), an amendment to the exercise price provisions
of those warrants issued in connection with a registered direct offering of the Company’s securities pursuant to that Stock Purchase
Agreement entered into by and among the Company and certain investors on November 1, 2021, and specifically to remove the $1.97 floor
price (the “Floor Price”) of the warrants such that the exercise price of the warrants may be reduced below the Floor Price
in the event that the Company issues or enters into any agreement to issue securities for consideration less than the then current exercise
price of the warrants.
4.
To consider and vote upon a proposal to authorize our board of directors (the “Board”), in its discretion, to adjourn the
Meeting to another place, or a later date or dates, if necessary or appropriate, to solicit additional proxies in favor of the proposals
listed above at the time of the Meeting.
5.
To transact such other business as may properly come before the Meeting or any adjournment or postponement thereof.
Any
action may be taken on any one of the foregoing proposals at the Meeting on the date specified above or on any date or dates to which
the meeting may be postponed or adjourned.
Our
Board recommends that you vote your shares “For” each of the foregoing proposals.
We
do not expect to transact any other business at the Meeting. Our Board has fixed the close of business on December 17, 2021 as the
record date for determining those stockholders entitled to vote at the Meeting and any adjournment or postponement thereof. Accordingly,
only stockholders of record at the close of business on that date are entitled to notice of, and to vote at, the Meeting. A complete
list of our stockholders will be available for examination at our offices in Sunrise, Florida, during ordinary business hours for a period
of 10 days prior to the Meeting.
We
cordially invite you to attend the virtual Meeting. However, to ensure your representation at the Meeting, please authorize the individuals
named on your proxy card to vote your shares by calling the toll-free telephone number, using the Internet, or by completing and promptly
return the proxy card sent to you in the mail, as described in the instructions included with your proxy card or voting instruction card.
This will not prevent you from voting at the Meeting, but will help to secure a quorum and avoid added solicitation costs. If your shares
are held in “street name” by your broker or other nominee, only that holder can vote your shares and your vote cannot be
cast unless you provide instructions to your broker. You should follow the directions provided by your broker regarding how to instruct
your broker to vote your shares. You may revoke your proxy at any time before it is voted. Please review the Proxy Statement accompanying
this notice for more complete information regarding the matters to be voted on at the Meeting.
Even
if you plan to attend the virtual Meeting, we request that you submit a proxy by following the instructions on your proxy card as soon
as possible in order to ensure that your shares will be represented at the Meeting if you are unable to attend.
By
Order of the Board of Directors
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John Todd
Bonner
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Chairman
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Sunrise,
Florida
December
[__], 2021
IMPORTANT:
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, WE ASK YOU TO VOTE BY TELEPHONE, MAIL, FAX OR ON THE INTERNET USING THE INSTRUCTIONS
ON THE PROXY CARD.
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TABLE
OF CONTENTS
PRELIMINARY
PROXY MATERIALS SUBJECT TO COMPLETION DATED DECEMBER 21, 2021
PROXY
STATEMENT
FOR
A SPECIAL MEETING OF STOCKHOLDERS
GENERAL
INFORMATION
NextPlay
Technologies, Inc. (“NextPlay,” “we,” “us,” “our” or the “Company”)
has delivered printed versions of these materials to you by mail, in connection with the Company’s solicitation of proxies for
use at our special meeting of stockholders (the “Meeting”) to be held on January 28, 2022 at 9:00 a.m. Eastern Time, and
at any postponement(s) or adjournment(s) thereof. The Meeting will be held virtually via live audio webcast at https://agm.issuerdirect.com/nxtp (please note this link is case sensitive). See also “Instructions for the Virtual Meeting,” beginning on page 1 of
this Proxy Statement for additional information regarding attending the virtual Meeting.
This
Proxy Statement and the enclosed proxy card are first being mailed to stockholders entitled to vote on or about December [__], 2021.
The Proxy Statement will also be accessible online on or about December [__], 2021 at: https://www.nextplaytechnologies.com/investors/sec-filings/.
You are invited to attend the Meeting and are requested to vote on the proposals described in this Proxy Statement.
Information
Contained In This Proxy Statement
The
information contained in this Proxy Statement relates to the proposals to be voted on at the Meeting, the voting process, ownership of
our outstanding securities, and certain other required information.
Instructions
For The Virtual Meeting
The
Meeting will be a completely virtual meeting. There will be no physical meeting location. The Meeting will only be conducted via live
audio webcast.
To
participate in the virtual Meeting, visit https://agm.issuerdirect.com/nxtp (please note this link is case
sensitive) and enter the control number on your proxy card, or on the instructions that accompanied your proxy materials.
You
may vote during the Meeting by following the instructions available on the Meeting website during the Meeting. To the best of our knowledge,
the virtual meeting platform is fully supported across browsers (Internet Explorer, Firefox, Chrome, and Safari) and devices (desktops,
laptops, tablets, and cell phones) running the most updated version of applicable software and plugins. Participants should ensure
they have a strong Internet connection wherever they intend to participate in the meeting. Participants should also allow plenty of time
to log in and ensure that they can hear streaming audio prior to the start of the meeting.
Questions
pertinent to meeting matters will be answered during the Meeting, subject to time constraints. Questions which are not pertinent to Meeting
matters will not be answered.
Record
Date and Shares Entitled to Vote
Our Board has fixed the close
of business on December 17, 2021, as the record date for determining the holders of shares of our common stock entitled to receive notice
of and to vote at the Meeting and any adjournments or postponements thereof. Only holders of record of shares of common stock at the close
of business on that date will be entitled to vote at the Meeting and at any adjournment or postponement thereof. As of the record date,
there were 114,317,388 shares of our common stock issued and outstanding and entitled to vote at the Meeting, which shares were
held by approximately 521 holders of record.
Each share of common stock is
entitled to one vote on each proposal presented at the Meeting and at any adjournment or postponement thereof, for 114,317,388 total
voting shares.
In
order for us to satisfy our quorum requirements, the holders of at least 33 1/3% of our total number of outstanding voting shares entitled
to vote at the Meeting must be present. You will be deemed to be present if you attend the Meeting or if you submit a proxy (including
through the mail, by fax or by telephone or the Internet) that is received at or prior to the Meeting (and not revoked).
If
your proxy is properly executed and received by us in time to be voted at the Meeting, the shares represented by your proxy (including
those given through the mail, by fax or by telephone or the Internet) will be voted in accordance with your instructions. If you execute
your proxy but do not provide us with any instructions, your shares will be voted “For” the proposals set forth in
this Proxy Statement, or otherwise determined by the proxies.
The
only matters that we expect to be presented at our Meeting are set forth in this Proxy Statement. If any other matters properly come
before the Meeting, the persons named in the proxy card will vote the shares represented by all properly executed proxies on such matters
in their best judgment.
Voting
Process
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If
you are a stockholder of record, there are five ways to vote:
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At
the virtual Meeting. You may vote during the Meeting by following the instructions available on the Meeting website during the
Meeting.
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Via
the Internet. You may vote by proxy via the Internet by following the instructions found on the proxy card.
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By
Telephone. You may vote by proxy by calling the toll-free number found on the proxy card.
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By
Fax. You may vote by proxy by faxing your proxy to the number found on the proxy card.
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By
Mail. You may vote by proxy by filling out the proxy card and returning it in the envelope provided.
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Revocability
of Proxies
The presence of a stockholder
at our Meeting will not automatically revoke that stockholder’s proxy. However, a stockholder may revoke their proxy at any time
prior to its exercise by:
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submitting
a written revocation prior to the Meeting to the Corporate Secretary, NextPlay Technologies, Inc., 1560 Sawgrass Corporate Parkway,
Suite 130, Sunrise, Florida 33323;
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submitting
another signed and later dated proxy card and returning it by mail in time to be received before our Meeting or by submitting a later
dated proxy by the Internet or telephone prior to the Meeting; or
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attending
the Meeting and voting by following the instructions available on the meeting website during the Meeting.
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Attendance
at the Special Meeting
Attendance at the Meeting
is limited to holders of record of our common stock at the close of business on the record date, December 17, 2021, and our guests. You
will be asked to provide your control number in order to be admitted into the Meeting. If your shares are held in the name of a bank,
broker, or other nominee and you plan to attend the Meeting, you must obtain your control number from such bank, broker, or other nominee,
or contact Issuer Direct Corporation at (919) 447-3740, or 1-866-752-VOTE (8683) to obtain your control number, in order to be admitted.
No recording of the Meeting will be permitted. At the Meeting, stockholders of the Company will be afforded a reasonable opportunity
to participate in the Meeting and to vote on matters submitted to the stockholders, including an opportunity to communicate, and to read
or hear the proceedings of the meetings in a substantially concurrent manner with such proceedings.
Conduct
at the Meeting
The
Chairman of the Meeting has broad responsibility and legal authority to conduct the Meeting in an orderly and timely manner. This authority
includes establishing rules for stockholders who wish to address the Meeting. Only stockholders or their valid proxy holders may address
the Meeting. The Chairman may exercise broad discretion in recognizing stockholders who wish to speak and in determining the extent of
discussion on each item of business. In light of the number of stockholders of the Company and the need to conclude the Meeting within
a reasonable period of time, we cannot ensure you that every stockholder who wishes to speak on an item of business will be able to do
so.
Quorum
Our
Bylaws, as amended, provide that 33 1/3% of the outstanding shares of our capital stock entitled to vote at the meeting, represented
in person (including virtually) or by proxy, constitutes a quorum at a meeting of our stockholders. If you vote at the Meeting or
by proxy at our Meeting, you will be counted for purposes of determining whether there is a quorum at the Meeting. Shares of our capital
stock present in person (including virtually) or by proxy at our Meeting that are entitled to vote will be counted for the purpose
of determining whether there is a quorum for the transaction of business at the Meeting.
Voting
Requirements for Each of the Proposals
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Proposal
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Vote Required
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Broker
Discretionary
Voting
Allowed*
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1.
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Approval of the issuance
of 1,250,000 shares of the Company’s common stock as consideration for the purchase of certain intellectual property of Token IQ
Inc., an entity owned and controlled by Mark Vange, the Company’s Chief Technology Officer.
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Majority of the votes cast on the proposal
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Yes
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2.
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Approval of the
issuance of 1,666,667 shares of the Company’s common stock as consideration for the purchase of certain intellectual property of
Fighter Base Publishing Inc., an entity owned and controlled by Mark Vange, the Company’s Chief Technology Officer.
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Majority of the votes cast on the proposal
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Yes
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3.
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Approval,
in accordance with Nasdaq Listing Rule 5635(d), of an amendment to the exercise price provisions of those warrants issued in connection
with a registered direct offering of the Company’s securities pursuant to that Stock Purchase Agreement entered into by and
among the Company and certain investors on November 1, 2021, and specifically to remove the $1.97 floor price (the “Floor Price”)
of the warrants such that the exercise price of the warrants may be reduced below the Floor Price in the event that the Company issues
or enters into any agreement to issue securities for consideration less than the then current exercise price of the warrants (the
“Warrant Amendment”).
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Majority
of the votes cast on the proposal
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Yes
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4.
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Authorization
of our board of directors, in its discretion, to adjourn the Meeting to another place, or a later date or dates, if necessary or
appropriate, to solicit additional proxies in favor of the proposals listed above at the time of the Meeting.
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Majority
of the shares of stock entitled to vote which are present, in person or by proxy, at the Meeting
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Yes
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*
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See
also “Quorum; Broker Non-Votes and Abstentions,” below.
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Broker
Non-Votes and Abstentions
The
presence at the Meeting of the holders of 33 1/3% of the outstanding shares of voting stock entitled to vote at the Meeting is necessary
to constitute a quorum. Broker non-votes and abstentions are counted for purposes of determining whether a quorum is present. Only “For”
and “Against” votes are counted for purposes of determining the votes received in connection with each proposal. Broker
non-votes and abstentions will not be counted as votes cast, and will have no effect on determining whether the affirmative vote constitutes
a majority of the votes cast at the Meeting. However, approval of the proposals requires the affirmative vote of a majority of the votes
cast on such proposals, and therefore broker non-votes and abstentions could prevent the approval of these proposals because they do
not count as affirmative votes. In order to minimize the number of broker non-votes, the Company encourages you to vote or to provide
voting instructions to the organization that holds your shares by carefully following the instructions provided in the proxy materials
that you receive.
If
a broker indicates on the proxy that it does not have discretionary authority as to certain shares to vote on a particular matter, those
shares will not be considered as present and entitled to vote with respect to that matter. For your vote to be counted, you must submit
your voting instruction form to your broker.
As
described above, although the Company will include abstentions and broker non-votes as present or represented for purposes of establishing
a quorum for the transaction of business, the Company intends to exclude abstentions and broker non-votes from the tabulation of voting
results on any issues requiring approval of a majority of the votes cast.
Dissenters’
Rights
Dissenters’
rights are not available with respect to any of the proposals to be voted on at the Meeting.
Board
of Directors Voting Recommendations
Our
Board recommends that you vote your shares:
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“FOR” the approval of the issuance of 1,250,000 shares of the Company’s common stock as consideration for the purchase of certain intellectual property of Token IQ Inc., an entity owned and controlled by Mark Vange, the Company’s Chief Technology Officer (Proposal 1);
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“FOR” the approval of the issuance of 1,666,667 shares of the Company’s common stock as consideration for the purchase of certain intellectual property of Fighter Base Publishing Inc., an entity owned and controlled by Mark Vange, the Company’s Chief Technology Officer (Proposal 2);
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“FOR”
the approval, in accordance with Nasdaq Listing Rule 5635(d), of the Warrant Amendment (Proposal
3); and
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“FOR”
authorization of our board of directors, in its discretion, to adjourn the Meeting to another
place, or a later date or dates, if necessary or appropriate, to solicit additional proxies
in favor of the proposals listed above at the time of the Meeting (Proposal 4).
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Mailing Costs and Solicitation of Proxies
In addition to solicitation
by use of the mails, certain of our officers and employees may solicit the return of proxies personally or by telephone, electronic mail
or facsimile. We have not and do not anticipate retaining a third-party proxy solicitation firm to solicit proxies on behalf of the Board.
The cost of any solicitation of proxies will be borne by us. Arrangements may also be made with brokerage firms and other custodians,
nominees and fiduciaries for the forwarding of material to, and solicitation of proxies from, the beneficial owners of our securities
held of record at the close of business on the record date by such persons. We will reimburse such brokerage firms, custodians, nominees
and fiduciaries for the reasonable out-of-pocket expenses incurred by them in connection with any such activities.
Inspector of Voting
It is anticipated that representatives
of Issuer Direct Corporation will tabulate the votes and act as inspector of election at the Meeting.
Stockholders Entitled to Vote at the Meeting
A complete list of stockholders
entitled to vote at the Meeting will be available to view during the Meeting. You may also access this list at our principal executive
offices, for any purpose germane to the Meeting, during ordinary business hours, for a period of ten days prior to the Meeting.
Voting Instructions
Your vote is very important.
Whether or not you plan to attend the Meeting, we encourage you to read this Proxy Statement and submit your proxy or voting instructions
as soon as possible. For specific instructions on how to vote your shares, please refer to the instructions included on the enclosed
proxy card.
Confidential Voting
Independent inspectors count
the votes. Your individual vote is kept confidential from us unless special circumstances exist. For example, a copy of your proxy card
will be sent to us if you write comments on the card, as necessary to meet applicable legal requirements, or to assert or defend claims
for or against the Company.
Stockholder of Record and Shares Held in
Brokerage Accounts
If on the record date your
shares were registered in your name with our transfer agent, then you are a stockholder of record and you may vote at the Meeting, by
proxy or by any other means supported by us. If on the record date your shares were held in an account at a brokerage firm, bank, dealer,
or other similar organization, then you are the beneficial owner of shares held in “street name” and the Proxy Statement is
required to be forwarded to you by that organization. The organization holding your account is considered the stockholder of record for
purposes of voting at the Meeting. As a beneficial owner, you have the right to direct your broker or, other agent on how to vote the
shares in your account. You are also invited to attend the Meeting. However, you must obtain your control number from such bank, broker,
or other nominee, or contact Issuer Direct Corporation at (919) 447-3740, or 1-866-752-VOTE (8683) to obtain your control number, in order
to be admitted and since you are not the stockholder of record, you may not vote your shares by following the instructions available on
the Meeting website during the Meeting unless you request and obtain a valid proxy from your broker or, other agent.
Multiple Stockholders Sharing the Same
Address
In some cases, one copy of
this Proxy Statement and the accompanying notice of meeting of stockholders is being delivered to multiple stockholders sharing an address,
at the request of such stockholders. We will deliver promptly, upon written or oral request, a separate copy of this Proxy Statement
or the accompanying notice of meeting of stockholders to such a stockholder at a shared address to which a single copy of the document
was delivered. Stockholders sharing an address may also submit requests for delivery of a single copy of this Proxy Statement or the
accompanying notice of meeting of stockholders, but in such event will still receive separate forms of proxy for each account. To request
separate or single delivery of these materials now or in the future, a stockholder may submit a written request to our Controller at
our principal executive offices at 1560 Sawgrass Corporate Parkway, Suite 130, Sunrise, Florida 33323, or a stockholder may make a request
by calling our Controller at (954) 888-9779.
If you receive more than
one set of proxy materials, it means that your shares are registered differently and are held in more than one account. To ensure that
all shares are voted, please either vote each account as discussed above under the section of this Proxy Statement entitled “Voting
Process,” or sign and return by mail all proxy cards or voting instruction forms.
Voting Results
The final voting results
will be tallied by the inspector of voting and published in our Current Report on Form 8-K, which we are required to file with the SEC
within four business days following the Meeting.
Company Mailing Address
The mailing address of our
principal executive offices is 1560 Sawgrass Corporate Parkway, Suite 130, Sunrise, Florida 33323.
Other Matters
As of the date of this Proxy
Statement, our Board is not aware of any business to be presented at the Meeting other than as set forth in the proxy materials that
have been mailed to you. If any other matters should properly come before the Meeting, it is intended that the shares represented by
proxies will be voted with respect to such matters in accordance with the judgment of the persons voting the proxies.
FORWARD LOOKING STATEMENTS
Statements
in this Proxy Statement that are “forward-looking statements” are based on current expectations and assumptions that are
subject to risks and uncertainties. In some cases, forward-looking statements can be identified by terminology such as “may,”
“will,” “should,” “potential,” “continue,” “expects,” “anticipates,”
“intends,” “plans,” “believes,” “estimates,” and similar expressions. These forward-looking
statements are based on our current estimates and assumptions and, as such, involve uncertainty and risk. Actual results could
differ materially from projected results.
We
do not assume any obligation to update information contained in this document, except as required by applicable laws. Although this Proxy
Statement may remain available on our website or elsewhere, its continued availability does not indicate that we are reaffirming or confirming
any of the information contained herein. Neither our website nor its contents are a part of this Proxy Statement.
VOTING RIGHTS AND PRINCIPAL STOCKHOLDERS
Holders of record of our common
stock at the close of business on the record date, December 17, 2021, will be entitled to one vote per share on all matters properly presented
at the Meeting and at any adjournment or postponement thereof. As of the record date, there were 114,317,388 shares of common stock
outstanding and entitled to vote at the Meeting and at any adjournment or postponement thereof, held by approximately 521 holders of record.
Each share of common stock is entitled to one vote on each proposal presented at the Meeting, for 114,317,388 total voting shares.
Our stockholders do not have
dissenters’ rights or similar rights of appraisal with respect to the proposals described herein
Security Ownership of Management and Certain
Beneficial Owners and Management
The following table sets forth,
as of the record date, December 17, 2021, the number and percentage of outstanding shares of our common stock beneficially owned by: (a)
each person who is known by us to be the beneficial owner of more than 5% of our outstanding shares of common stock; (b) each of our directors;
(c) our named executive officers; and (d) all current directors, our director nominees and executive officers, as a group. As of the record
date, there were 114,317,388 shares of common stock issued and outstanding.
Beneficial ownership has
been determined in accordance with Rule 13d-3 under the Exchange Act. Under this rule, certain shares may be deemed to be beneficially
owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares). In addition,
shares are deemed to be beneficially owned by a person if the person has the right to acquire shares (for example, upon exercise of an
option or warrant or upon conversion of a convertible security) within 60 days of December 17, 2021. In computing the percentage
ownership of any person, the amount of shares is deemed to include the amount of shares beneficially owned by such person by reason of
such acquisition rights. As a result, the percentage of outstanding shares of any person as shown in the following table does not necessarily
reflect the person’s actual voting power at any particular date.
To our knowledge, except as
indicated in the footnotes to this table and pursuant to applicable community property laws, (a) the persons named in the table have
sole voting and investment power with respect to all shares of common stock shown as beneficially owned by them, subject to applicable
community property laws; and (b) no person owns more than 5% of our common stock. Unless otherwise indicated, the address for each
of the officers or directors listed in the table below is 2893 Executive Park Drive, Suite 201, Weston, Florida 33331.
Name of Beneficial Owner
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Shares of
Common
Stock
Beneficially
Owned (1)
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Percent of
Common
Stock
Outstanding (2)
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Executive Officers and Directors
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William Kerby, Co-Chief Executive Officer & Director
|
|
|
921,151
|
(3)
|
|
|
*
|
|
Nithinan Boonyawattanapisut, Co-Chief Executive Officer & Director
|
|
|
23,407,110
|
(4)
|
|
|
20.5
|
%
|
Sirapop “Kent” Taepakdee, Chief Financial Officer
|
|
|
27,500
|
|
|
|
*
|
|
Tim Sikora, Chief Information Officer
|
|
|
27,000
|
|
|
|
*
|
|
Andrew Greaves, Chief Operating Officer
|
|
|
100,000
|
|
|
|
*
|
|
Mark Vange, Chief Technology Officer
|
|
|
1,000,000
|
|
|
|
*
|
|
Donald P. Monaco, Director
|
|
|
2,126,306
|
(5)
|
|
|
1.9
|
%
|
John Todd Bonner, Chairman of the Board
|
|
|
23,407,110
|
(4)
|
|
|
20.5
|
%
|
Athid Nanthawaroon, Director
|
|
|
107,576
|
|
|
|
*
|
|
Carmen Diges, Director
|
|
|
9,470
|
|
|
|
*
|
|
Komson Kaewkham, Director
|
|
|
7,576
|
|
|
|
*
|
|
Yoshihiro Obata, Director
|
|
|
9,470
|
|
|
|
*
|
|
Farooq Moosa, Director
|
|
|
-
|
|
|
|
*
|
|
Edward Terrance Gardner, Jr.
|
|
|
629,965
|
|
|
|
*
|
|
All Executive Officers and Directors as a Group (14 persons)
|
|
|
28,373,124
|
(6)
|
|
|
24.7
|
%
|
|
|
|
|
|
|
|
|
|
5% Stockholders
|
|
|
|
|
|
|
|
|
Red Anchor Trading Corp. Limited(7)
|
|
|
14,794,503
|
|
|
|
13.0
|
%
|
Tree Roots Entertainment Group Co Ltd.(8)
|
|
|
12,366,667
|
|
|
|
10.9
|
%
|
|
(1)
|
Includes
options, warrants and convertible securities exercisable or convertible for common stock within 60 days of December 17, 2021.
|
|
(2)
|
Based
on 114,317,388 shares of common stock outstanding as of December 17, 2021.
|
|
(3)
|
William
Kerby holds 670,872 shares of common stock and warrants to purchase 34,600 shares of common stock of the Company individually. Mr. Kerby
is deemed to own 80,000 shares held by In-Room Retail Systems, LLC, which entity he owns. 135,679 shares of common stock are also issuable
upon conversion of that certain Convertible Promissory Note in the amount of $380,889, which accrues interest at the rate of 12% per
annum, compounded monthly at the end of each calendar month, with such interest payable at maturity or upon conversion. The principal
and accrued interest owed under the Convertible Promissory Note is convertible, at the option of the holder thereof, into shares of the
Company’s common stock, at any time beginning seven days after the date the HotPlay Exchange Agreement closes and prior to the
payment in full of such Convertible Promissory Note by the Company, at a conversion price equal to the greater of (i) the closing consolidated
bid price of the Company’s common stock on April 8, 2021 (which was $3.02); and (ii) the five-day volume weighted average price
of the Company’s common stock for the five trading days following the date that the HotPlay Exchange Agreement closes. The Convertible
Promissory Note is unsecured, has a maturity date of April 7, 2022, and includes standard and customary events of default.
|
|
(4)
|
Nithinan
Boonyawattanapisut and John Todd Bonner are married. Accordingly, they beneficially own the same securities of the Company. Ms. Boonyawattanapisut’s
and Mr. Bonner’s holdings consist of the following: (i) 2,300,204 shares of common stock held directly by Ms. Boonyawattanapisut;
(ii) 27,500 shares of common stock held directly by Mr. Bonner; (iii) 14,794,503 shares of common stock held by Red Anchor Trading Corporation
(“Red Anchor”), 10.91% of which is owned by Ms. Boonyawattanapisut and 19.77% of which is owned by Mr. Bonner; (iv) 2,500,000
shares of common stock NextPlay Holdings LLC, 73.3% of which is owned by Red Anchor; (v) 1,558,046 shares of common stock held by Cern
One Limited, 100% of which is owned by Ms. Boonyawattanapisut, and (vi) 2,226,857 shares of common stock held by Found Side Ltd., 50%
of which is owned by Ms. Boonyawattanapisut and 48% of which is owned by Mr. John Todd Bonner.
|
|
(5)
|
Donald
P. Monaco beneficially owns (i) 859,224 shares of common stock owned by the Donald P. Monaco Insurance Trust (the “Trust”),
and (ii) 822,302 shares are beneficially owned by Monaco Investment Partners II, LP (“MI Partners”). Mr. Monaco also individually
owns 237,500 shares of common stock of the Company. Mr. Monaco is the managing general partner of MI Partners and trustee of the Trust.
Mr. Monaco disclaims beneficial ownership of all shares held by the Trust and MI Partners in excess of his pecuniary interest, if any.
207,280 shares of common stock are also issuable upon conversion of that certain Convertible Promissory Note in the amount of $585,425,
which accrues interest at the rate of 12% per annum, compounded monthly at the end of each calendar month, with such interest payable
at maturity or upon conversion. The principal and accrued interest owed under the Convertible Promissory Note is convertible, at the
option of the holder thereof, into shares of the Company’s common stock, at any time beginning seven days after the date the HotPlay
Exchange Agreement closes and prior to the payment in full of such Convertible Promissory Note by the Company, at a conversion price
equal to the greater of (i) the closing consolidated bid price of the Company’s common stock on April 8, 2021 (which was $3.02);
and (ii) the five-day volume weighted average price of the Company’s common stock for the five trading days following the date
that the HotPlay Exchange Agreement closes. The Convertible Promissory Notes are unsecured, have a maturity date of April 7, 2022, and
include standard and customary events of default. As the closing date of the HotPlay Exchange Agreement is currently unknown, such shares
of common stock issuable upon conversion of the Convertible Promissory Note has not been included in the stockholders beneficial ownership
in the table above.
|
(6)
|
Because Ms.
Boonyawattanapisut’s and Mr. Bonner beneficially own the same securities due to the fact that they are married, such securities
have only been included once for purposes of calculating the number of shares of common stock held by all executive officers and
directors as a group.
|
|
|
(7)
|
Address: Morgan & Morgan
Building, Pasea Estate, PO Box 958, Road Town, Tortola, BVI. The shares are also beneficially owned by Ms. Boonyawattanapisut’s
and Mr. Bonner, as discussed in footnote 4, above. Based on information reported on Schedule 13D/A filed by Red Anchor (and others)
with the SEC on October 22, 2021, which has not been independently verified.
|
|
|
(8)
|
Address: 695, Soi Sukhumvit 50, Sukhumvit Road PHRA Khanong, Khlong TOIE Bangkok,
Thailand 10260.
Based on information available to the Company, which has not been independently verified.
|
Changes in Control
The Company is not currently
aware of any arrangements which may at a subsequent date result in a change of control of the Company.
As previously disclosed by
the Company in that Current Report on 8-K filed by the Company on July 23, 2020, the Company entered into (a) a Share Exchange Agreement
(as amended and restated to date, the “HotPlay Exchange Agreement” and the transactions contemplated therein, the “HotPlay
Share Exchange”) with HotPlay Enterprise Limited (“HotPlay”) and the stockholders of HotPlay (the “HotPlay
Stockholders”); and (b) a Share Exchange Agreement (as amended to date, “Axion Exchange Agreement”) with
certain stockholders holding shares of Axion Ventures, Inc. (“Axion” and the “Axion Stockholders”) and certain
debt holders holding debt of Axion (the “Axion Creditors”) (the “Axion Share Exchange,” and collectively with
the HotPlay Exchange Agreement, the “Exchange Agreements” and the transactions contemplated therein, the “Share Exchanges”),
each dated as of July 21, 2020. The Share Exchanges closed on June 30, 2021 (the “Closing”). In connection with the Closing,
the Company acquired 100% of the outstanding capital shares of HotPlay (making HotPlay a wholly-owned subsidiary of the Company).
In connection with the Share
Exchanges, upon the closing of the HotPlay Share Exchange, the former HotPlay Stockholders were issued 52,000,000 shares of the Company’s
common stock in exchange for 100% of the outstanding shares of HotPlay, and the outstanding shares of Series B Convertible Preferred
Stock and Series C Convertible Preferred Stock automatically converted into an aggregate of 11,246,200 shares of our common stock (the
“Preferred Conversion”). As a result of the Closing, a change of control of the Company occurred, with the former stockholders
of HotPlay obtaining control over the Company. The former stockholders of HotPlay and the former holders of Series B Convertible Preferred
Stock and Series C Convertible Preferred Stock held 72.6% of the Company’s 87,100,403 issued and outstanding shares of common stock
immediately following the Closing. Specifically, in connection with the Closing, and the issuance of shares of common stock of the Company
in connection therewith and the Preferred Conversion, effective June 30, 2021, Ms. Nithinan Boonyawattanapisut and Mr. J. Todd Bonner,
husband and wife, became the largest stockholders of the Company, beneficially owning 31,117,544 shares of common stock, or 35.7% of
the Company’s then outstanding common stock (through Ms. Boonyawattanapisut’s control of Red Anchor Trading Corporation,
which held 27,213,606 of such shares of record and Cern One Limited, which held 3,562,208 shares of common stock, and an additional 314,230
shares of common stock held by Ms. Boonyawattanapisut directly and 27,500 shares held by Mr. Bonner, directly). Separately, as of Closing,
Jwanwat Ahriyavraromp and Pornsinee Chalermrattawongz, each beneficially owned the 21,966,667 shares of common stock held by Tree Roots
Entertainment Group, Ltd. and the 3,533,333 shares of common stock held by Dee Supreme Company Limited, issued in connection with the
Closing, due to their status as directors of such entities, which in aggregate totaled 29.3% of the Company’s outstanding shares
of common stock immediately following the Closing.
Pursuant to the terms of
the HotPlay Share Exchange, the former HotPlay stockholders, had certain appointment rights as to officers of the Company and directors
of the Company, which were exercised at Closing.
In addition, in
connection with the above transactions, on or around February 22, 2021, each of the HotPlay stockholders, and Ms. Nithinan
Boonyawattanapisut, Mr. J. Todd Bonner, Mr. Athid Nanthawaroon and Mr. Komson Kaewkham, each nominees for appointment to the Board
at the closing, entered into a Voting Agreement with Mr. William Kerby, the Company’s Chief Executive Officer (now Co-Chief Executive Officer), and Mr. Donald
P. Monaco, the Chairman of the Board (now a Director). Pursuant to the Voting Agreement, each of the HotPlay stockholders agreed to vote all voting
shares of the Company which they hold and may hold in the future (during the term of the agreement) to elect Mr. Kerby and Mr.
Monaco to the Board, and each of the HotPlay nominees agreed to continue to nominate each of Mr. Kerby and Mr. Monaco to the Board.
The agreement continues in effect until the earlier of February 26, 2026, the date of both Mr. Kerby’s and Mr. Monaco’s
death, or the date that both Mr. Kerby and Mr. Monaco have provided notice of termination to such HotPlay Stockholders.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE
Thayer O’Neal Company, LLC
Prior to its de-registration
with the PCAOB, Thayer served as our independent registered accounting firm from May 16, 2019 to September 30, 2020, and audited our
financial statements for the years ended February 29, 2020 and February 28, 2019. On September 30, 2020, in connection with its de-registration,
the Company dismissed Thayer as the independent registered public accounting firm of the Company. The Company’s Board of Directors
approved the dismissal of Thayer.
The reports of Thayer regarding
the Company’s financial statements for the fiscal years ended February 29, 2020 and February 28, 2019 did not contain any adverse
opinion or disclaimer of opinion and were not modified as to uncertainty, audit scope, or accounting principles, except each report did
contain an explanatory paragraph related to the Company’s ability to continue as a going concern. During the Company’s fiscal
years ended February 29, 2020 and February 28, 2019, and through September 30, 2020, there were (i) no disagreements with Thayer on any
matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which disagreements, if
not resolved to the satisfaction of Thayer would have caused Thayer to make reference to the subject matter of the disagreements in connection
with its report, and (ii) with the exception of material weaknesses related to the reconciliation of various accounts, lack of precision
and accuracy to properly reflect in the financial statements, there were no “reportable events,” as that term is defined
in Item 304(a)(1)(v) of Regulation S-K.
On September 30, 2020, the
Company engaged TPS as the Company’s new independent registered public accounting firm. The appointment of TPS was approved by
the Company’s Board.
The Company disclosed the
change in auditors in a Current Report on Form 8-K filed with the Securities and Exchange Commission on October 5, 2020.
M&K CPAS, PLLC
Prior to the appointment
of Thayer, M&K served as our independent registered accounting firm from October 11, 2018 to May 16, 2019. On May 16, 2019, M&K
resigned as the independent registered public accounting firm of the Company.
M&K reviewed the Company’s
Quarterly Reports on Form 10-Q for the quarters ended August 31, 2018 and November 30, 2018. M&K did not provide any audit reports
to the Company, and as such, there were no adverse opinions or disclaimers of opinion and no qualifications or modifications as to uncertainty,
audit scope or accounting principles.
During the period from October
11, 2018, and through May 16, 2019, there were (i) no disagreements with M&K on any matter of accounting principles or practices,
financial statement disclosure or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of M&K would
have caused M&K to make reference to the subject matter of the disagreements in connection with its report, and (ii) there were no
events of the type described in Item 304(a)(1)(v) of Regulation S-K, except as disclosed below. The Company had one disagreement with
M&K. M&K believed the complexities related to a series of transactions warranted formal consultation with the Securities and
Exchange Commission’s Office of the Chief Accountant (“SEC-OCA”). The Company believed that the transactions did not
warrant formal consultation with the SEC-OCA and that it did not have sufficient time to request such formal guidance (with the due date
of its Annual Report on Form 10-K approaching). Because the Company did not believe requesting guidance from the SEC-OCA was warranted
and because it did not want to spend the time and resources to request guidance from the SEC-OCA, M&K resigned.
On May 16, 2019, the Company
engaged Thayer as the Company’s new independent registered public accounting firm. The appointment of Thayer was approved by the
Company’s Board.
The Company disclosed the
change in auditors in a Current Report on Form 8-K filed with the Securities and Exchange Commission on May 21, 2019.
PROPOSAL 1
APPROVAL OF THE TOKEN IQ TRANSACTION
Background
As previously disclosed in
that Current Report on 8-K filed by the Company on August 25, 2021, on August 19, 2021 (the “Token IQ 8-K”), we entered into
an Intellectual Property Purchase Agreement (the “Token IPP Agreement”) with Token IQ Inc. (“Token IQ”), a leading
innovator in digital asset management. Token IQ’s business focuses on the digital assets industry, providing its customers with
“Know Your Customer” (“KYC”) related services, as well as a solution to replace their digital assets should they
lose access to, or control of, their digital assets, amongst other things. Token IQ’s foundational intellectual property is designed
to reconcile legal and regulatory requirements around digital assets, including KYC, Anti-money laundering and shareholder rights enforcement,
all common pain points within the crypto markets today. Token IQ is owned and controlled by Mark Vange, our Chief Operating Officer.
Pursuant to the Token IPP
Agreement, we agreed to issue Token IQ 1,250,000 shares of our common stock as consideration for the purchase
of 100% of the assets of Token IQ (the “Token IQ Transaction”). Upon closing of the Token IQ Transaction (if approved by
our stockholders), Token will sell, assign, transfer, convey, deliver and relinquish to the Company, and the Company will purchase and
acquire from Token IQ, free and clear of all liens, all of Token IQ’s right, title and interest in all of its assets, with limited
exceptions. We will not assume any liabilities or obligations of Token IQ in connection with the Token IQ transaction.
The 1,250,000 shares of our
common stock issuable by us to Token IQ at close will be restricted; provided, however, that pursuant to the Token IPP Agreement, we
have agreed to file a registration statement with the Securities and Exchange Commission to register for resale by Token IQ any of such
shares that are still restricted six months after closing of the Token IQ Transaction.
Pursuant to the Token IPP
Agreement, Token IQ will retain the right to license the intellectual property purchased thereunder to third parties, with the approval
of the Company, which shall not be unreasonable withheld, provided that any licenses are non-transferable, non-sublicensable and non-exclusive,
and that the licenses will not compete with the Company. Any consideration received by Token IQ from such licenses will be split 50/50
between the Company and Token IQ.
The Token IPP Agreement includes
customary representations, warranties, covenants, and indemnification obligations of the parties. The closing of the transactions contemplated
by the Token IPP Agreement are subject to customary closing conditions, which include, due to Mr. Vange’s status as an officer
of the Company, the approval of our stockholders of the transactions contemplated by the Token IPP Agreement and the issuance of shares
of common stock thereunder.
The foregoing description
of the Token IPP Agreement, above, is subject to, and qualified in its entirety by, the full text of the Token IPP Agreement,
a copy of which is attached as Exhibit 10.1 to the Token IQ 8-K, which is incorporated by reference herein.
Reasons for Stockholder Approval
If the Token IQ Transaction
is approved by our stockholders, we will not only look to license the intellectual property purchased pursuant to the Token IPP Agreement,
but also plan to integrate the services into our wholly owned Bank, NextBank International, to better serve our cryptocurrency customers.
We believe that the Token IQ technology that we have agreed to purchase under the Token IPP Agreement will become core to all of our
fintech-related activities, and will bring significant value to the Company and our stockholders. We also expect the Token IQ acquisition
to bring valuable technology and software development talent to the Company, which is expected to support rapid integration with our
platform and those of our partners, as well as further IP development.
The terms of the Token
IPP Agreement require that we obtained stockholder approval of the Token IQ Transaction prior to closing. In addition, as noted
above, Mark Vange, our Chief Operating Officer, owns and controls Token IQ; accordingly, the Token IQ Transaction constitutes a related party
transaction. Thus, in order to ensure that we comply with applicable
regulatory requirements and the provisions of the Token IPP Agreement, we are asking for stockholder approval of the Token IQ Transaction, and specifically the issuance of 1,250,000 shares
of common stock to Token IQ in exchange for the assets of Token IQ.
Vote Required
Approval of the Toke IQ Transaction
requires the affirmative (“For”) vote of a majority of the votes cast on the proposal (more “For”
votes than “Against” votes), provided that a quorum exists at the Meeting. Broker non-votes and abstentions will not
be counted as votes cast, and will have no effect on determining whether the affirmative votes constitute a majority of the votes cast
at the Meeting. Properly executed proxies will be voted at the Meeting in accordance with the instructions specified on the proxy; if
no such instructions are given, the persons named as agents and proxies in the enclosed form of proxy will vote such proxy “For”
approving the Token IQ Transaction.
OUR BOARD RECOMMENDS A VOTE “FOR”
APPROVING THE TOKEN IQ TRANSACTION
PROPOSAL 2
APPROVAL OF THE FIGHTER BASE TRANSACTION
Background
As previously disclosed in
that Current Report on 8-K filed by the Company on August 23, 2021, on August 19, 2021 (the “Fighter Base IQ 8-K”), we entered
into an Intellectual Property Purchase Agreement (the “Fighter Base IPP Agreement”) with Fighter Base Publishing Inc. (“Fighter
Base”), a video game development company. Fighter Base’s wholly-owned division, Make It Games™ (“MIG”),
has developed proprietary technology that enables developers to create video games powered by artificial intelligence (“AI”).
Its technology supports the training of virtual characters to be more lifelike in appearance and behavior. Proprietary AI animation tools
help program game or film characters to fully animate themselves, saving as much as 70% of the typical time and cost of animation. Fighter
Base is owned and controlled by Mark Vange, our Chief Operating Officer.
Pursuant to the Fighter Base
IPP Agreement, we agreed to issue Fighter Base 1,666,667 shares of our common stock as consideration for the
purchase of the assets and AI-powered video game development platform of MIG (the “MIG Assets”) (the “Fighter Base Transaction”).
Upon closing of the Fighter Base Transaction (if approved by our stockholders), Fighter Base will sell, assign, transfer, convey, deliver
and relinquish to the Company, and the Company will purchase and acquire from Fighter Base, free and clear of all liens, all of Fighter
Base’s right, title and interest in the MIG Assets. We will not assume any liabilities or obligations of Fighter Base in connection
with the Fighter Base transaction.
The 1,666,667 shares of our
common stock issuable by us to Fighter Base at close will be restricted; provided, however, that pursuant to the Fighter Base Agreement,
we have agreed to file a registration statement with the Securities and Exchange Commission to register for resale by Fighter Base any
of such shares that are still restricted six months after closing of the Fighter Base Transaction.
The Fighter Base IPP Agreement
includes customary representations, warranties, covenants, and indemnification obligations of the parties. The closing of the transactions
contemplated by the Fighter Base IPP Agreement are subject to customary closing conditions, which include, due to Mr. Vange’s status
as an officer of the Company, the approval of our stockholders of the transactions contemplated by the Fighter Base IPP Agreement and
the issuance of shares of common stock thereunder.
The foregoing description
of the Fighter Base Agreement, above, is subject to, and qualified in its entirety by, the full text of the Fighter Base IPP
Agreement, a copy of which is attached as Exhibit 10.1 to the Fighter Base 8-K, which is incorporated by reference herein.
Reasons for Stockholder Approval
If the Fighter Base Transaction
is approved by our stockholders, we will not only look to utilize the technology in our own business, but also to potentially license
the intellectual property purchased pursuant to the Fighter Base IPP Agreement to other game and film studios, ad agencies and other content
creators. We believe that the Fighter Base technology that we have agreed to purchase under the Fighter Base IPP Agreement will help accelerate
our global initiatives and significantly enhance our online advertising, interactive digital media, gaming, fintech and travel platforms
and services, and will serve as a bridge for us to expand into the metaverse. The acquisition is expected to greatly augment our growing
global technology group that is focused on developing and implementing innovative consumer-engaging assets across multiple media channels.
The terms of the Fighter
Base IPP Agreement require that we obtained stockholder approval of the Fighter Base Transaction prior to closing. In addition, as
noted above, Mark Vange, our Chief Operating Officer, owns and controls Fighter Base; accordingly, the Fighter Base Transaction constitutes a related party
transaction. Thus, in order to ensure that we comply with
regulatory requirements and the provisions of the Fighter Base IPP
Agreement, we are asking for stockholder approval of the Fighter Base Transaction, and specifically the issuance of
1,666,667 shares of common stock to Fighter Base in exchange for the assets of Fighter Base.
Vote Required
Approval of the Fighter Base
Transaction requires the affirmative (“For”) vote of a majority of the votes cast on the proposal (more “For”
votes than “Against” votes), provided that a quorum exists at the Meeting. Broker non-votes and abstentions will not
be counted as votes cast, and will have no effect on determining whether the affirmative votes constitute a majority of the votes cast
at the Meeting. Properly executed proxies will be voted at the Meeting in accordance with the instructions specified on the proxy; if
no such instructions are given, the persons named as agents and proxies in the enclosed form of proxy will vote such proxy “For”
approving the Fighter Base Transaction.
OUR BOARD RECOMMENDS A VOTE “FOR”
APPROVING THE FIGHTER BASE TRANSACTION
PROPOSAL 3
APPROVAL OF THE WARRANT AMENDMENT
Background
As previously disclosed in
that Current Report on 8-K filed by the Company on November 3, 2021, on November 1, 2021 (the “Offering 8-K”), we entered
into a Securities Purchase Agreement (the “SPA”) with certain institutional investors (the “Purchasers”), pursuant
to which we agreed to issue and sell, in a registered direct offering (the “Offering”), an aggregate of 18,987,342 shares
(the “Shares”) of our common stock, par value $0.00001 per share, together with warrants to purchase an aggregate of 14,240,508
shares of common stock (the “Warrants”), at a combined price of $1.58 per Share and accompanying three quarters of a Warrant.
Each
whole Warrant sold in the Offering is exercisable for one share of our common stock at an initial exercise price of $1.97 per share
(the “Initial Exercise Price”), the closing sales price of our common stock on October 29, 2021 (the last trading day prior
to the date that the SPA was entered into). The Warrants may be exercised commencing six months after the issuance date (the “Initial
Exercise Date”) and terminating on the fifth anniversary of the Initial Exercise Date. The Warrants are exercisable for cash; provided,
however that they may be exercised on a cashless exercise basis if, at the time of exercise, there is no effective registration statement
registering, or no current prospectus available for, the issuance or resale of the shares of common stock issuable upon exercise of the
Warrants. The exercise of the Warrants will be subject to a beneficial ownership limitation, which will prohibit the exercise thereof,
if upon such exercise the holder of the Warrants, its affiliates and any other persons or entities acting as a group together with the
holder or any of the holder’s affiliates would hold 4.99% (or, upon election of a purchaser prior to the issuance of any shares,
9.99%) of the number of shares of the common stock outstanding immediately after giving effect to the issuance of shares of common stock
issuable upon exercise of the Warrant held by the applicable holder, provided that the holders may increase or decrease the beneficial
ownership limitation (up to a maximum of 9.99%) upon 61 days advance notice to the Company, which 61 day period cannot be waived.
The
Warrants also include certain anti-dilution rights, which provide that if at any time the Warrants are outstanding, we issue or enter
into any agreement to issue, or are deemed to have issued or entered into an agreement to issue (which includes the issuance of securities
convertible or exercisable for shares of common stock), securities for consideration less than the then current exercise price of the
Warrants, the exercise price of such Warrants will be automatically reduced to the lowest price per share of consideration provided or
deemed to have been provided for such securities; provided, however, that unless and until the Company has received stockholder approval
to reduce the exercise price of the Warrants below the Floor Price, $1.97 per share, no such adjustment to the exercise price may be made.
Pursuant
to the SPA, we agreed to use our best efforts to obtain stockholder approval within 90 days from November 1, 2021 (the date of the prospectus
supplement) to remove the Floor Price of the Warrants. In the event that such stockholder approval is not obtained within 90 days of November
1, 2021, we have agreed to hold a special meeting of our stockholders every three months thereafter, for so long as the Warrants remain
outstanding, to obtain such stockholder approval.
The
foregoing description of the SPA the Warrants is not complete and is qualified in its entirety by reference to the full text of the form
of SPA and form of Common Stock Purchase Warrant, copies of which are attached as Exhibit 10.1 and Exhibit 4.1, respectively, to
the Offering 8-K, which is incorporated by reference herein.
Effects of the Warrant Amendment
As discussed above, pursuant
to the SPA, if at any time the Warrants are outstanding, we issue or enter into any agreement to issue, or are deemed to have issued or
entered into an agreement to issue (which includes the issuance of securities convertible or exercisable for shares of common stock),
securities for consideration less than the then current exercise price of the Warrants, the exercise price of such Warrants will be automatically
reduced to the lowest price per share of consideration provided or deemed to have been provided for such securities, subject to the Floor
Price limitation. If we amend the Warrants to Remove the Floor Price, we will be required to reduce the exercise price of the Warrants
in the event that we issue, or enter into an agreement to issue, securities at a price that is lower than $1.97 per share, subject to
limited exceptions.
Reduction in the exercise
price of the Warrants would reduce the proceeds that we would receive upon exercise of the Warrants by holders thereof. In addition, the
reduction in exercise price could incentivize holders of the Warrant to exercise their Warrants when they may not otherwise do so, which
could result in significant dilution in the percentage ownership interest of our existing common stockholders and in a significant dilution
of voting rights and earnings per share. The sale or availability for sale of shares issuable upon exercise of the Warrants at a reduced
price per share may depress the price of our common stock and could encourage short sales by third parties, which could further depress
the price of our common stock. It could also make it more difficult for us to raise additional working capital at terms favorable to the
Company and or its stockholders, which could negatively impact our business.
To the extent that the holders
the Warrants sell shares of our common stock issued upon exercise of the Warrants, the market price of such shares may decrease due to
the additional selling pressure in the market. In addition, the risk of dilution from issuances of such shares may cause stockholders
to sell their shares of our common stock, which could further contribute to any decline in the price of our common stock. Any downward
pressure on the price of our common stock caused by the sale or potential sale of such shares could encourage short sales by third parties.
In a short sale, a prospective seller borrows shares from a stockholder or broker and sells the borrowed shares. The prospective seller
hopes that the share price will decline, at which time the seller can purchase shares at a lower price for delivery back to the lender.
The seller profits when the share price declines because it is purchasing shares at a price lower than the sale price of the borrowed
shares. Such sales could place downward pressure on the price of our common stock by increasing the number of shares of our common stock
being sold, which could further contribute to any decline in the market price of our common stock.
Reasons for Stockholder Approval
Our common stock is listed
on the Nasdaq Capital Market, and, as such, we are subject to the applicable rules of the Nasdaq Stock Market LLC, including Nasdaq Listing
Rule 5635(d), which requires stockholder approval prior to the issuance of securities in connection with a transaction other than a public
offering involving the sale, issuance or potential issuance by the Company of common stock (or securities convertible into or exercisable
for common stock) at a price less than the greater of book or market value which equals 20% or more of common stock or 20% or more of
the voting power outstanding before the issuance; or the sale, issuance or potential issuance by the Company of common stock (or securities
convertible into or exercisable for common stock) equal to 20% or more of the common stock or 20% or more of the voting power outstanding
before the issuance for less than the greater of book or market value of the stock.
As noted above, we issued
an aggregate of 18,987,342 Shares, together with warrants to purchase an aggregate of 14,240,508 shares of common stock, at a combined
offering price of $1.58 per Share and accompanying three quarters of a Warrant. For purposes of Nasdaq Listing Rule 5635(d), the number
of shares issued below fair market value of our common stock in the Offering amounted to 18,987,342 shares, the number of Shares issued
in the offering, which equaled approximately 19.94% of our issued and outstanding shares of common stock. Because the Initial Exercise
Price of the Warrants, as well as the Floor Price of the Warrants, was equal to fair market value of our common stock ($1.97 per share),
the Warrants were not deemed to be issued at a price less than the fair market value of our common stock as of the date of the SPA. As
a result, we were not required to obtain stockholder approval in order to consummate the Offering.
Because removal of the Floor
Price could result in the exercise price of the Warrants falling below the market price of our securities, as set forth in the SPA, which
would result in our issuance of more than 20% of our issued and outstanding securities as of the date of the Offering at a price below
market value, we must obtain stockholder approval of such amendment in order to comply with Nasdaq Listing Rule 5635(d).
As noted above, pursuant to
the SPA, we agreed to use our best efforts to obtain stockholder approval within 90 days from November 1, 2021 to remove the Floor Price
of the Warrants. Thus, in order to ensure that we comply with applicable Nasdaq rules and our obligations under the SPA, we are asking
for stockholder approval of the Warrant Amendment.
In the event that we do not
obtain the necessary stockholder approval at the Meeting, we will be obligated to hold a special meeting of our stockholders every three
months thereafter, for so long as the Warrants remain outstanding, to obtain such stockholder approval.
Vote Required
Approval of the Warrant Amendment
requires the affirmative (“For”) vote of a majority of the votes cast on the proposal (more “For”
votes than “Against” votes), provided that a quorum exists at the Meeting. Broker non-votes and abstentions will not
be counted as votes cast, and will have no effect on determining whether the affirmative votes constitute a majority of the votes cast
at the Meeting. Properly executed proxies will be voted at the Meeting in accordance with the instructions specified on the proxy; if
no such instructions are given, the persons named as agents and proxies in the enclosed form of proxy will vote such proxy “For”
approving the Warrant Amendment.
OUR BOARD RECOMMENDS A VOTE “FOR”
APPROVING THE WARRANT AMENDMENT
PROPOSAL 4
ADJOURNMENT OF THE MEETING
General
Our stockholders may be asked
to consider and act upon one or more adjournments of the Meeting, if necessary or appropriate, to solicit additional proxies in favor
of any or all of the other proposals set forth in this Proxy Statement.
If a quorum is not present
at the Meeting, our stockholders may be asked to vote on the proposal to adjourn the Meeting to solicit additional proxies. If a quorum
is present at the Meeting, but there are not sufficient votes at the time of the Meeting to approve one or more of the proposals, our
stockholders may also be asked to vote on the proposal to approve the adjournment of the Meeting to permit further solicitation of proxies
in favor of the other proposals. However, a stockholder vote may be taken on one of the proposals in this Proxy Statement prior to any
such adjournment if there are sufficient votes for approval on such proposal.
If the adjournment proposal
is submitted for a vote at the Meeting, and if our stockholders vote to approve the adjournment proposal, the Meeting will be adjourned
to enable the Board to solicit additional proxies in favor of one or more proposals. If the adjournment proposal is approved, and the
Meeting is adjourned, the Board will use the additional time to solicit additional proxies in favor of any of the proposals to be presented
at the Meeting, including the solicitation of proxies from stockholders that have previously voted against the relevant proposal.
Our Board believes that, if
the number of shares of our common stock voting in favor of any of the proposals presented at the Meeting is insufficient to approve a
proposal, it is in the best interests of our stockholders to enable the Board, for a limited period of time, to continue to seek to obtain
a sufficient number of additional votes in favor of the proposal. Any signed proxies received by us in which no voting instructions are
provided on such matter will be voted in favor of an adjournment in these circumstances. The time and place of the adjourned Meeting will
be announced at the time the adjournment is taken. Any adjournment of the Meeting for the purpose of soliciting additional proxies will
allow our stockholders who have already sent in their proxies to revoke them at any time prior to their use at the Meeting, as adjourned
or postponed.
Vote Required
Authority to adjourn the Meeting
pursuant to this Proposal 4, to another place, date or time, if deemed necessary or appropriate, in the discretion of the Board, requires
the vote of a majority of the shares of common stock entitled to vote which are present, in person or by proxy, at the Meeting.
OUR BOARD RECOMMENDS A VOTE “FOR”
THE ADJOURNMENT OF THE MEETING,
IF NECESSARY OR APPROPRIATE, TO SOLICIT ADDITIONAL
PROXIES.
OTHER MATTERS
Stockholder Proposals for 2022 Annual Meeting
of Stockholders
Proposals of holders of our
voting securities intended to be presented at our 2022 annual meeting of stockholders and included in our proxy statement and form of
proxy relating to such meeting pursuant to Rule 14a-8 of Regulation 14A must have been received by us, addressed to our Corporate Secretary,
at our principal executive offices at 1560 Sawgrass Corporate Parkway, Suite 130, Sunrise, Florida 33323, not earlier than the close of
business on October 27, 2021, and not later than the close of business on November 26, 2021, together with written notice of the stockholder’s
intention to present a proposal for action at the fiscal 2022 annual meeting of stockholders, unless our annual meeting date occurs more
than 30 days before or 30 days after February 24, 2022. In that case, we must receive proposals not earlier than the close of business
on the 120th day prior to the date of the fiscal 2022 annual meeting and not later than the close of business on the later of the 90th
day prior to the date of the annual meeting or, if the first public announcement of the date of the annual meeting is less than 100 days
prior to the date of the meeting, the 10th day following the day on which we first make a public announcement of the date of the meeting.
Stockholder proposals must
be in writing and must include (i) the name and record address of the stockholder who intends to propose the business and the class
or series and number of shares of capital stock of the Company that are owned beneficially or of record by such stockholder; (ii) a
representation that the stockholder is a holder of record of stock of us entitled to vote at such meeting and intends to appear in person
or by proxy at the meeting to introduce the business specified in the notice; (iii) a brief description of the business desired to
be brought before the annual meeting and the reasons for conducting such business at the annual meeting; (iv) any material interest
of the stockholder in such business; and (v) any other information that is required to be provided by the stockholder pursuant to
Regulation 14A under the Exchange Act. The board of directors reserves the right to refuse to submit any proposal to stockholders at an
annual meeting if, in its judgment, the information provided in the notice is inaccurate or incomplete, or does not comply with the requirements
for stockholder proposals set forth in our Bylaws.
Additionally, the Nominating
and Governance Committee will consider director candidates recommended by stockholders, provided stockholders include (i) as to each
person whom the stockholder proposes for the Nominating and Governance Committee to consider for nomination for election as a director
(a) the name, age, business address and residence address of the person, (b) the principal occupation or employment of the person,
(c) the class or series and number of shares of capital stock of us which are owned beneficially or of record by the person and (d) any
other information relating to the person that would be required to be disclosed in a proxy statement or other filings required to be made
in connection with solicitations of proxies for election of directors pursuant to Section 14 of the Exchange Act, and the rules and regulations
promulgated thereunder; and (ii) as to the stockholder giving the notice (a) the name and record address of such stockholder,
(b) the class or series and number of shares of capital stock of the Company which are owned beneficially or of record by such stockholder,
(c) a description of all arrangements or understandings between such stockholder and each proposed nominee and any other person or
persons (including their names) pursuant to which the nomination(s) are to be made by such stockholder, (d) a representation
that such stockholder intends to appear in person or by proxy at the meeting to nominate the persons named in its notice, and (e) any
other information relating to such stockholder that would be required to be disclosed in a proxy statement or other filings required to
be made in connection with solicitations of proxies for election of directors pursuant to Section 14 of the Exchange Act and the rules
and regulations promulgated thereunder. Such notice must be accompanied by a written consent of each proposed nominee to being named as
a nominee and to serve as a director if elected. Individuals recommended by stockholders in accordance with these procedures will receive
the same consideration received by individuals identified to the Nominating and Governance Committee through other means.
Additional Filings
We file annual reports on
Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and proxy and information statements and amendments to reports
filed or furnished pursuant to Sections 13(a) and 15(d) of the Exchange Act. The SEC maintains a website (http://www.sec.gov) that contains
reports, proxy and information statements and other information regarding us and other companies that file materials with the SEC electronically.
Additional information about us is available on our website at www.Nextplaytechnologies.com. Information on our website does not constitute
part of this proxy statement.
We will provide, without charge,
to each person to whom a Proxy Statement is delivered, upon written or oral request of such person and by first class mail or other equally
prompt means within one business day of receipt of such request, a copy of any of the filings described above. Individuals may request
a copy of such information by sending a request to us, Attn: Corporate Secretary, NextPlay Technologies, Inc., 1560 Sawgrass Corporate
Parkway, Suite 130, Sunrise, Florida 33323.
Other Matters to be Presented at the Meeting
As of the date of this Proxy
Statement, our management has no knowledge of any business to be presented for consideration at the Meeting other than that described
above. If any other business should properly come before the Meeting or any adjournment thereof, it is intended that the shares represented
by properly executed proxies will be voted with respect thereto in accordance with the judgment of the persons named as agents and proxies
in the enclosed form of proxy.
Our Board does not intend
to bring any other matters before the Meeting and has not been informed that any other matters are to be presented by others.
Interest of Certain Persons in or Opposition
to Matters to Be Acted Upon:
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(a)
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Except
for Mr. Vange’s interests in the matters set forth in proposals 1 and 2, as further described above, no officer or director of
us has any substantial interest in the matters to be acted upon, other than his or her role as an officer or director of us, or as a
stockholder of us.
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(b)
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No director of us has informed us that he or she intends to oppose the action taken by us set forth in this proxy statement.
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Incorporation of Information by Reference
The SEC allows us to “incorporate
by reference” certain information that we file with the SEC, which means that we can disclose important information by referring
you to those documents. The information incorporated by reference is considered to be a part of this Proxy Statement. We incorporate herein
the following information contained in or attached to our Annual Report on Form 10-K for the fiscal year ended February 28, 2020, which
we filed with the SEC on June 8, 2021: (i) Item 7 entitled “Management’s Discussion and Analysis of Financial Condition and
Results of Operations, and (ii) Item 8 entitled “Financial Statements and Supplementary Data.
We will provide, without charge,
to each person to whom a proxy statement is delivered, upon written or oral request of such person and by first class mail or other equally
prompt means within one business day of receipt of such request, a copy of any and all of the information that has been incorporated by
reference in this Proxy Statement.
Company Contact Information
All inquiries regarding our
Company should be addressed to our Company’s principal executive office:
NextPlay Technologies, Inc.
1560 Sawgrass Corporate Parkway, Suite 130
Sunrise, Florida 33323
By Order of the Board of Directors,
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John Todd Bonner, Chairman
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NEXTPLAY
TECHNOLOGIES, INC.
THIS
PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
SPECIAL
meeting OF STOCKHOLDERS – jANUARY 28, 2022 at 9:00 AM EASTERN STANDARD TIME
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CONTROL ID:
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REQUEST ID:
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The undersigned, a stockholder of
NextPlay Technologies, Inc. (the “Company”), hereby acknowledges receipt of the Notice of Special Meeting of Stockholders
and Proxy Statement of the Company, each dated on or around December [__], 2021, and hereby appoints William Kerby and Sirapop “Kent”
Taepakdee (the “Proxies”), or any one of them, with full power of substitution and authority to act in the absence of
the other, each as proxies and attorneys-in-fact, to cast all votes that the undersigned is entitled to cast at, and with all powers
that the undersigned would possess if personally present at, the Special Meeting of stockholders of the Company, to be held on January
28, 2022, at 9:00 am Eastern Standard Time (subject to postponement(s) or adjournment(s) thereof), virtually via live audio webcast
at https://agm.issuerdirect.com/nxtp (please note this link is case sensitive), and at any adjournment or postponement thereof,
and to vote all shares of the Company that the undersigned would be entitled to vote if then and there personally present, on the
matters set forth in the proxy statement, and all such other business as may properly come before the meeting. I/we hereby revoke
all proxies previously given.
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(CONTINUED
AND TO BE SIGNED ON REVERSE SIDE.)
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VOTING INSTRUCTIONS
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If you vote
by phone, fax or internet, please DO NOT mail your proxy card.
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MAIL:
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Please mark, sign, date, and return
this Proxy Card promptly using the enclosed envelope.
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FAX:
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Complete the reverse portion of this
Proxy Card and Fax to 202-521-3464.
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INTERNET:
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https://www.iproxydirect.com/NXTP
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PHONE:
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1-866-752-VOTE(8683)
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SPECIAL MEETING OF THE STOCKHOLDERS
OF
NEXTPLAY TECHNOLOGIES, INC.
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PLEASE COMPLETE,
DATE, SIGN AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.
PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE: ☒
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PROXY
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
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Proposal
1
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à
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FOR
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AGAINST
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ABSTAIN
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Approval of the issuance of 1,250,000 shares of the Company’s
common stock as consideration for the purchase of certain intellectual property of Token IQ Inc., an entity owned and controlled
by Mark Vange, the Company’s Chief Technology Officer.
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☐
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☐
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Control
ID:
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REQUEST
ID:
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Proposal
2
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à
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FOR
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AGAINST
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ABSTAIN
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Approval of the issuance of 1,666,667 shares of the Company’s
common stock as consideration for the purchase of certain intellectual property of Fighter Base Publishing Inc., an entity owned
and controlled by Mark Vange, the Company’s Chief Technology Officer.
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☐
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Proposal
3
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à
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FOR
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AGAINST
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ABSTAIN
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Approval, in accordance with Nasdaq Listing Rule 5635(d), of an amendment
to the exercise price provisions of those warrants issued in connection with a registered direct offering of the Company’s
securities pursuant to that Stock Purchase Agreement entered into by and among the Company and certain investors on November 1, 2021,
and specifically to remove the $1.97 floor price (the “Floor Price”) of the warrants such that the exercise price of
the warrants may be reduced below the Floor Price in the event that the Company issues or enters into any agreement to issue securities
for consideration less than the then current exercise price of the warrants.
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☐
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☐
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Proposal
4
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à
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FOR
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AGAINST
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ABSTAIN
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Authorization of the Company’s board of directors, in its discretion,
to adjourn the Meeting to another place, or a later date or dates, if necessary or appropriate, to solicit additional proxies in
favor of the proposals listed above at the time of the Special Meeting appropriate.
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MARK “X” HERE IF YOU PLAN TO ATTEND THE MEETING:
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This Proxy, when properly
executed will be voted as provided above, or if no contrary direction is indicated, it will be voted “For” each of Proposal
Nos. 1 through 4.
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MARK
HERE FOR ADDRESS CHANGE ¨ New Address (if
applicable):
____________________________
____________________________
____________________________
IMPORTANT:
Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should sign. When signing
as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is a corporation, please
sign full corporate name by duly authorized officer, giving full title as such. If signer is a partnership, please sign in partnership
name by authorized person.
Dated: ________________________,
2022
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(Print Name of Stockholder and/or Joint
Tenant)
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(Signature of Stockholder)
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(Second Signature if held jointly)
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