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UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
8-K
CURRENT
REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date
of report (Date of earliest event reported): August 15, 2023
SPLASH
BEVERAGE GROUP, INC. |
(Exact
Name of Registrant as Specified in Its Charter) |
|
Nevada |
(State
or Other Jurisdiction of Incorporation) |
001-40471 |
|
34-1720075 |
(Commission
File Number) |
|
(IRS
Employer Identification No.) |
|
1314
East Las Olas Blvd, Suite 221
Fort Lauderdale, Florida 33301 |
|
(Address
of Principal Executive Offices) |
|
(954)
745-5815 |
(Registrant’s
Telephone Number, Including Area Code) |
|
N/A |
(Former
Name or Former Address, if Changed Since Last Report) |
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under
any of the following provisions (see General Instruction A.2. below):
☐ |
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|
|
☐ |
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
|
|
☐ |
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
|
|
☐ |
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities
registered pursuant to Section 12(b) of the Act:
Title
of each class |
|
Trading
Symbol(s) |
|
Name
of each exchange on
which registered |
Common
Stock, $0.001 par value per share |
|
SBEV |
|
NYSE
American LLC |
Warrants
to purchase shares of common stock |
|
SBEV-WT |
|
NYSE
American LLC |
Indicate
by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405
of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging
growth company ☐
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01
Entry into a Material Definitive Agreement.
| 1. | 0% Convertible Promissory Notes |
On
February 28, 2023, Splash Beverage Group, Inc. (the “Company”) entered into a securities purchase agreement (the “SPA”)
with an accredited investor (the “Investor”). Pursuant to the SPA, the Company sold to the Investor, convertible 12-month
promissory notes (the “Investor Note”) convertible for up to 2,000,000 shares of the Company’s common stock, $0.001
par value per share and received aggregate gross proceeds of $2,000,000. The Conversion Price of the Investor Note is $1.00 per share
subject to adjustments as provided in the Investor Note. The Company agreed to issue to the Investor an additional 1,500,000 shares
of restricted common stock, at the time of conversion. The maturity date of the Investor Note is
twelve months from the issuance date.
The
Investor Notes are subject to customary events of default including the failure to pay principal and interest when due, bankruptcy by
the Company. Upon the occurrence of any event of default, the unpaid portion of the principal
amount will bear simple interest from the date of the event of default at a rate equal to 18% per annum, for the duration from such event
of default until the cure of such default or the repayment date of the entire outstanding balance of the Investor
Note.
On August 10, 2023, the Company
and Investor entered into an amendment to the SPA (“Amendment”), pursuant to which the Company sold and issued to the Investor,
an additional note (the “Second Investor Note”) convertible for up to 1,100,000 shares of the Company’s
common stock, $0.001 par value per share, for aggregate gross proceeds of $1,100,000. The conversion price of the Second Investor Note
is $1.00 per share, subject to adjustments as provided in the Second Investor Note. The Company agreed to issue to the Investor
an additional 550,000 shares of restricted common stock, at the time of conversion.
The foregoing summary of
the Amendment, SPA, Investor Note and, Second Investor Note is qualified by reference to the full text of such documents, copies of
which are filed as exhibits to this report and incorporated herein by reference.
| 2. | 12% Convertible Promissory Notes |
From
May through July, the Company entered into a series of securities purchase agreements (the “Purchase Agreements”) with certain
accredited investors (the “Purchasers”). Pursuant to the Purchase Agreements, the Company sold the Purchasers 12% convertible
12 to 18-month promissory notes (the “Notes”) convertible for up to 1,600,000 shares of the Company’s common stock,
$0.001 par value per share and warrants exercisable into 800,000 shares of the Company’s common stock (the “Warrants”)
and received aggregate gross proceeds of $1,600,000. The Conversion Price of the Notes is $1.00 per share subject to adjustments as provided
in the Notes.
The
maturity date of the Notes is twelve to eighteen months from the issuance date of the Notes. Interest on the unpaid principal balance
of the Notes accrues at 12% per annum and subject to the conversion of the Notes accrued interest outstanding is payable in full on the
maturity date of the Notes. The Warrants are exercisable on the date of conversion of the Notes at an exercise price of $0.25 per share,
subject to adjustment, and will expire three (3) years from the initial exercise date.
The
Notes are subject to customary events of default including the failure to pay principal and interest when due, bankruptcy by the Company.
Upon the occurrence of an event of default, the unpaid portion of the principal amount will
bear simple interest from the date of the event of default at a rate equal to 7% per annum, for the duration from such event of default
until the cure of such default or the repayment date of the entire outstanding balance of the Note.
On
the maturity date of the Notes, the principal and interest and any amounts due on the Notes shall automatically convert unless at least
one business date prior to such date, the Holder and/or the Company have indicated in writing that the Note shall not automatically convert.
The
foregoing summary of the Purchase Agreement, Notes, and Warrant are qualified by reference to the full text of such documents, copies of
which are filed as exhibits to this report and incorporated herein by reference.
Item 2.02 Results of Operations and Financial Condition.
On August
14, 2023, the Company issued a press release announcing certain financial results for the second quarter period ended June 30, 2023. A
copy of the press release is attached as exhibit 99.1, and incorporated by reference herein.
The
information in this Current Report, including the exhibits hereto, is being furnished and shall not be deemed “filed” for
purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section or
Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended. The information contained in this Item 2.02 and in the accompanying
Exhibit 99.1 shall not be incorporated by reference into any registration statement or other document filed by the Company with the Securities
and Exchange Commission, whether made before or after the date of this Current Report, regardless of any general incorporation language
in such filing, except as shall be expressly set forth by specific reference in such filing.
Item 2.03 Creation of
a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The
information set forth in Item 1.01 and 8.01 of this Current Report on Form 8-K is incorporated herein by reference.
Item 3.02 Unregistered
Sales of Equity Securities
The
information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated herein reference, to the extent required. Based
in part upon the representations of the Investor and the Purchasers, to the Company, including that they are an “accredited investor”
as defined under Rule 501(a) of Regulation D, the shares of Common Stock issuable under the SPA, the Purchase
Agreements or upon exercise of the Warrant, will be exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended.
Item 9.01 Financial Statements
and Exhibits.
(d) Exhibits.
SIGNATURES
Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: August 16, 2023
SPLASH BEVERAGE GROUP, INC. |
|
|
|
/s/ Robert Nistico |
|
Robert Nistico |
|
Chief Executive Officer |
|
EXHIBIT 4.1
NEITHER THIS SECURITY NOR THE SECURITIES
FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION
OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY
MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.
COMMON
STOCK PURCHASE WARRANT
SPLASH BEVERAGE GROUP, INC.
Warrant Shares_________ |
Initial Exercise Date: __________ |
|
|
|
Issue Date: __________ |
THIS
COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that,
for value received, Name or their assigns (the “Holder”)
is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on
or the date hereof (the “Initial Exercise Date”) and on or prior
to the close of business on the three (3) year anniversary of the Initial Exercise Date (the “Termination
Date”) but not thereafter, to subscribe for and purchase from Splash
Beverage Group, Inc., an Nevada corporation (the “Company”),
up to ________ shares (as subject to adjustment hereunder, the “Warrant Shares”)
of Common Stock 50% of the shares of Common Stock purchased by the Holder in the Offering]. The purchase price of one share
of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 1(b). This Warrant is being pursuant
to the Subscription Agreement between the Holder and the Company dated _________.
Section
1. Exercise.
a) Exercise
of Warrant. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times
on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company (or such other office or
agency of the Company as it may designate by notice in writing to the registered Holder at the address of the
Holder appearing on the books of the
Company) of a duly executed facsimile copy (or e-mail attachment) of the Notice of Exercise in the form annexed hereto (the “Notice
of Exercise”). Within the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising the Standard
Settlement Period (as defined in Section 2(d)(i) herein) following the date of exercise as aforesaid, the Holder shall deliver
the aggregate Exercise Price for the shares specified in the applicable Notice of Exercise by wire transfer or cashier’s
check drawn on a United States bank unless the cashless exercise procedure specified in Section 2(c) below is specified in the
applicable Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other
type of guarantee or notarization) of any Notice of Exercise be required. Notwithstanding anything herein to the contrary, the
Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant
Shares available hereunder and the Warrant has been exercised in full, in which case,
the Holder shall surrender this Warrant to
the Company for cancellation within two (2) Trading Days of the date the final Notice of Exercise is delivered to the Company.
Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder
shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable
number of Warrant Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased
and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise within one (1) Business Day of
receipt of such notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of
the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares
available for purchase hereunder at any given time may be less than the amount stated on the face
hereof. As used herein “Business Day” means any day except any Saturday, any Sunday, any day which is a
federal legal holiday in the United States or any day on which banking institutions in the State of New York are authorized or
required by law or other governmental action to close.
b) Exercise Price. The exercise price
per share of the Common Stock under this Warrant shall be $0.25 Dollars, subject to adjustment hereunder (the “Exercise
Price”).
c) Cashless Exercise. If at least
6 months has passed from issuance, there is no effective registration statement registering the Warrant Shares, then this Warrant
may also be exercised, in whole or in part, at such time by means of a “cashless exercise” in which the Holder shall
be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A),
where:
(A)=the
average closing price per share of Common Stock for the five (5) days prior to the Notice of Exercise;
(B) = the Exercise Price of this Warrant, as adjusted hereunder;
and
(X) =
the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant
if such exercise were by means of a cash exercise rather than a cashless exercise.
If Warrant
Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the
Securities Act, the Warrant Shares shall take on the characteristics of the Warrants being exercised, and the holding period of
the Warrant Shares being issued may be tacked on to the holding period of this Warrant. The Company agrees not to take any position
contrary to this Section 2(c).
d) Mechanics of
Exercise.
i. Delivery
of Warrant Shares Upon Exercise. The Company shall cause the Warrant Shares purchased
hereunder to be transmitted by the Transfer Agent to the Holder by crediting the account of the Holder’s or its designee’s
balance account with The Depository Trust Company through its Deposit or Withdrawal at Custodian system (“DWAC”)
if the Company is then a participant in such system and either (A) there is an effective registration statement permitting the
issuance of the Warrant Shares to or resale of the Warrant Shares by Holder or (B) the Warrant Shares are eligible for resale by
the Holder without volume or manner-of- sale limitations pursuant to Rule 144, and otherwise by physical delivery of a certificate,
registered in the Company’s share register in the name of the Holder or its designee, for the number of Warrant Shares to
which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by the
date that is the earlier of (i) the earlier of (A) two (2) Trading Days after the delivery to the Company of the Notice of Exercise
and (B) one (1) Trading Day after delivery of the aggregate Exercise Price to the Company and (ii) the number of Trading Days comprising
the Standard Settlement Period after the delivery to the Company of the Notice of Exercise (such date, the “Warrant
Share Delivery Date”). Upon delivery of the Notice of Exercise, the Holder shall
be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant
has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregate Exercise
Price (other than in the case of a cashless exercise) is received within the earlier of (i)
three (3) Trading Days and (ii) the number of Trading Days comprising the Standard Settlement Period following delivery
of the Notice of Exercise. If the Company fails for any reason to deliver to the Holder the Warrant Shares subject to a Notice
of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as
a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of the Common Stock on the date of the
applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading
Day on the fifth Trading Day after such liquidated damages begin to accrue) for each Trading Day after such Warrant Share Delivery
Date until such Warrant Shares are delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent
that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable. As used herein, “Standard
Settlement Period” means the standard settlement period, expressed in a number
of Trading Days, on the Company’s primary Trading Market with respect to the Common Stock as in effect on the date of delivery
of the Notice of Exercise. As used herein “Trading Market”
means the following markets or exchanges on which the Company’s Common Stock is listed or quoted for trading on the date
in question: the NYSE Amex Equities, the NASDAQ Capital Market, the New York Stock Exchange or the OTC Markets Group Inc. “Trading
Day” means a day on which the principal Trading Market is open for trading.
ii. Delivery
of New Warrants Upon Exercise. If this Warrant shall have been exercised in part,
the Company shall, at the request of a Holder and upon surrender of this Warrant certificate, at the time of delivery of the Warrant
Shares, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called
for by this Warrant, which new Warrant shall in all other respects be identical with this
Warrant.
iii. Rescission
Rights. If the Company fails to cause
the Transfer Agent to transmit to the Holder the Warrant Shares by the Warrant Share Delivery Date, then the Holder will have the
right to rescind such exercise.
iv. Compensation
for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition
to any other rights available to the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant
Shares pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is required by its
broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, shares
of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving
upon such exercise (a “Buy-In”), then the Company shall (A)
pay in cash to the Holder the amount, if any, by which (x) the Holder’s total purchase price (including brokerage commissions,
if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares
that the Company was required to deliver to the Holder in connection with the exercise at issue times (2) the price at which the
sell order giving rise to such purchase obligation was executed,
and (B) at the option of the Holder, either reinstate the portion
of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall
be deemed rescinded) or deliver to the Holder the number of shares of Common Stock that would have been issued had the Company
timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Common Stock having
a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise
of shares of Common Stock with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of
the immediately preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company
written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence
of the amount of such loss. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder,
at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the
Company’s failure to timely deliver shares of Common Stock upon exercise of the Warrant as required pursuant to the terms
hereof.
v. No
Fractional Shares or Scrip. No fractional shares or scrip representing fractional
shares shall be issued upon the exercise of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled
to purchase upon such exercise, the Company shall, at its election, either pay a cash adjustment in respect of such final fraction
in an amount equal to such fraction multiplied by the Exercise Price or round up to the next whole
share.
vi. Charges,
Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the
Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such Warrant Shares, all of which
taxes and expenses shall be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name
or names as may be directed by the Holder; provided, however,
that in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered
for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may require,
as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company shall
pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company
(or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant
Shares.
vii. Closing
of Books. The Company will not close its stockholder books or records in any manner
which prevents the timely exercise of this Warrant, pursuant to the terms hereof.
Section 2. Certain
Adjustments.
a) Stock Dividends and Splits. If
the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise makes a distribution
or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares of Common
Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon exercise of this
Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of
reverse stock split) outstanding shares of Common Stock into a smaller number of shares, or (iv) issues by reclassification of
shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied
by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding
immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately
after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the
aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 2(a) shall become
effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution
and shall become effective immediately after the effective date in the case of a subdivision, combination or
re-classification.
b) Pro Rata Distributions. During
such time as this Warrant is outstanding, if the Company shall declare or make any dividend or other distribution of its assets
(or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital or otherwise (including, without
limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification,
corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”), at any time after
the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution to the
same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable
upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the
Beneficial Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such record
is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation in such
Distribution (provided, however, to the extent that the Holder’s right to participate in any such Distribution would result
in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution
to such extent (or in the beneficial ownership of any shares of Common Stock as a result of such Distribution to such extent) and
the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right
thereto would not result in the Holder exceeding the Beneficial Ownership Limitation). To the extent that this Warrant has not
been partially or completely exercised at the time of such Distribution, such portion of the Distribution shall be held in abeyance
for the benefit of the Holder until the Holder has exercised this Warrant.
c) Fundamental Transaction. If, at
any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related transactions effects
any merger or consolidation of the Company with or into another Person, (ii) the Company, directly or indirectly, effects any sale,
lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one or a series
of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company
or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange their shares
for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common Stock, (iv)
the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization
of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged
for other securities, cash or property, or (v) the Company, directly or indirectly,
in one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without
limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person or group of Persons whereby
such other Person or group acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common
Stock held by the other Person or other Persons making or party to,
or associated or affiliated with the other Persons making or
party to, such stock or share purchase agreement or other business combination) (each a “Fundamental Transaction”),
then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would
have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the
Holder, the number of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving
corporation, and any additional consideration (the “Alternate Consideration”) receivable as a result of such Fundamental
Transaction by a holder of the number of shares of Common Stock for which this Warrant is exercisable immediately prior to such
Fundamental Transaction. For purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted
to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common
Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in
a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Common
Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder
shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental
Transaction. As used herein “Person” means an individual or corporation, partnership, trust, incorporated or unincorporated
association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or
other entity of any kind.
d) Calculations. All calculations
under this Section 2 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this
Section 2, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the
number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.
e) Notice to
Holder.
i. Adjustment
to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision
of this Section 2, the Company shall promptly deliver to the Holder by facsimile or email a notice setting forth the Exercise Price
after such adjustment and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts
requiring such adjustment.
ii. Notice
to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other
distribution in whatever form) on the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a
redemption of the Common Stock, (C) the Company shall authorize the granting to all holders of the Common Stock rights or warrants
to subscribe for or purchase any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of
the Company shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which
the Company is a party, any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share
exchange whereby the Common Stock is converted into other securities, cash or property, or (E) the Company shall authorize the
voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company
shall cause to be delivered by facsimile or email to the Holder at its last facsimile number or email address as it shall appear
upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter
specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption,
rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled
to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification,
consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is
expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities,
cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided
that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate
action required to be specified in such notice. To the extent that any notice provided in this Warrant constitutes, or contains,
material, non- public information regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such
notice with the Commission pursuant to a Current Report on Form 8-K. The Holder shall remain entitled to exercise this Warrant
during the period commencing on the date of such notice to the effective date of the event triggering such notice except as may
otherwise be expressly set forth herein.
Section 3. Transfer
of Warrant.
a) Transferability.
Subject to compliance with any applicable securities laws, this Warrant and all rights hereunder (including, without limitation,
any registration rights) are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company
or its designated agent, together with a written assignment of this Warrant substantially in the form attached hereto duly executed
by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer.
Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name
of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment,
and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly
be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant
to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant to the
Company within three (3) Trading Days of the date the Holder delivers an assignment form to the Company assigning this Warrant
in full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant
Shares without having a new Warrant issued.
b) New
Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company,
together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder
or its agent or attorney. Subject to compliance with Section 3(a), as to any transfer which may be involved in such division or
combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided
or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the Issue Date of this
Warrant and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant
thereto.
c) Warrant
Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant
Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder
of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for
all other purposes, absent actual notice to the contrary.
d) Reserved.
e) Representation
by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant and, upon any exercise
hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to or for distributing
or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities law,
except pursuant to sales registered or exempted under the Securities Act.
Section 4. Miscellaneous.
a) No
Rights as Stockholder Until Exercise. This Warrant does not entitle the Holder to any voting rights, dividends or other rights
as a stockholder of the Company prior to the exercise hereof as set forth in Section 1(d)(i), except as expressly set forth in
Section 2.
b) Loss,
Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt
by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock
certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory
to it (which, in the case of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such
Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor
and dated as of such cancellation, in lieu of such Warrant or stock certificate.
c) Saturdays,
Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted
herein shall not be a Business Day, then, such action may be taken or such right may be exercised on the next succeeding Business
Day.
d) Authorized
Shares.
The Company
covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient
number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant.
The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged
with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company
will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without
violation of any applicable law or regulation,
or of any requirements of the Trading Market upon which the Common Stock may be
listed. The Company covenants that all Warrant Shares which may be issued upon the exercise of the purchase rights represented
by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance
herewith, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges created by
the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with such
issue).
Except and to
the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending
its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, 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
Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions
as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting
the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable
therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate
in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant
and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory
body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.
Before taking
any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the
Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary
from any public regulatory body or bodies having jurisdiction thereof.
e) Jurisdiction.
All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed by and construed
in accordance with the laws of the State of New York, without giving effect to conflicts of law principles. Any dispute that may
that may arise between them arising out of or in connection with this Warrant shall be adjudicated before a court located in the
City of New York, Borough of Manhattan, and they hereby submit to the exclusive jurisdiction of the federal and state courts of
the State of New York located in the City of New York, Borough of Manhattan with respect to any action or legal proceeding commenced
by any party, and irrevocably waive any objection they now or hereafter may have respecting the venue of any such action or proceeding
brought in such a court or respecting the fact that such court is an inconvenient forum, relating to or arising out of this Warrant
or any acts or omissions relating to the sale of the securities hereunder, and consent to the service of process in any such action
or legal proceeding by means of registered or certified mail, return receipt requested, postage prepaid, in care of the address
set forth herein or such other address as either party shall furnish in writing to the other.
WAIVER OF JURY
TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY
AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABY AND EXPRESSLY
WAIVES FOREVER TRIAL BY JURY
f) Restrictions.
The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and the Holder does
not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities
laws.
g) Nonwaiver.
No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of
such right or otherwise prejudice the Holder’s rights, powers or remedies.
h) Notices.
Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered
in accordance with the notice provisions of the Subscription Agreement.
i) Limitation
of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase
Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder
for the purchase price of any Common Stock or as a stockholder of the Company, whether
such liability is asserted by the Company or by creditors of the Company.
j) Remedies.
The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled
to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation
for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert
the defense in any action for specific performance that a remedy at law would be adequate.
k) Successors
and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to
the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns
of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and
shall be enforceable by the Holder or holder of Warrant Shares.
l) Amendment.
This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the
Holder.
m) Severability.
Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective
to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions
of this Warrant.
n) Headings.
The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of
this Warrant.
********************
(Signature Page Follows)
IN WITNESS WHEREOF, the Company has caused
this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.
SPLASH BEVERAGE GROUP, INC. |
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By: |
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Name: |
Robert Nistico |
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Title: |
President |
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NOTICE OF EXERCISE
TO: SPLASH BEVERAGE GROUP, INC.
(1) The
undersigned hereby elects to purchase Warrant
Shares of the Company pursuant to the terms of the attached Warrant (only if exercised
in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if
any.
(2) Payment
shall take the form of (check applicable box):
[ ] in lawful
money of the United States; or
[ ] if permitted
the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c),
to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure
set forth in subsection 2(c).
(3) Please
issue said Warrant Shares in the name of the undersigned or in such other name as is specified
below:
The Warrant Shares shall be delivered to the following DWAC Account
Number:
(4) Accredited
Investor. The undersigned is an “accredited investor” as defined in Regulation D promulgated under the Securities Act
of 1933, as amended.
[SIGNATURE OF HOLDER]
Name of Investing
Entity:________________________________________________________
Signature of Authorized Signatory of
Investing Entity: __________________________________
Name of Authorized
Signatory:____________________________________________________
Title of Authorized
Signatory: _____________________________________________________
Date: _____________________________
EXHIBIT B
ASSIGNMENT FORM
(To assign the foregoing Warrant,
execute this form and supply required information. Do not use this form to purchase shares.)
FOR VALUE RECEIVED, the foregoing Warrant and
all rights evidenced thereby are hereby assigned to
Name: |
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(Please Print) |
Address: |
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(Please Print) |
Phone Number: |
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(Please Print) |
Email Address: |
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(Please Print) |
Dated: _____________,_______
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Holder’s
Signature: ____________________ |
Holder’s
Address:_____________________ |
13
EXHIBIT
10.1
SPLASH BEVERAGE GROUP, INC.
SECURITIES PURCHASE AGREEMENT
This SECURITIES
PURCHASE AGREEMENT (this “Agreement”) is made and entered into as of February 28, 2023, by and between Splash Beverage
Group, Inc., a Nevada corporation (the “Company”), and the investors set forth on the signature pages affixed hereto
(each, an “Investor” and, collectively, the “Investors”);
WHEREAS, the
Company wishes to sell and issue to the Investors, an aggregate of up to $2,000,000 (the “Maximum Offering Amount”)
of the Company’s convertible promissory notes in the form of Exhibit A attached hereto (each, a “Promissory Note”
or “Note” and collectively the “Promissory Notes” or “Notes”) which are convertible into the
Company’s Common Stock, par value $0.001 per share (“Common Stock”);
WHEREAS, in
connection with the Investor’s purchase of the Notes, for each $1,000 of Notes purchased, the Company will issue to the Investor
750 shares of restricted common stock, issuable upon the purchase of the amount of the Promissory Notes by an Investor (the “Purchase
Price”);
WHEREAS, unless
terminated earlier by the Company, the offering (the “Offering”) and sales of the Promissory Notes shall terminate
on the sooner of the sale of the Maximum Offering Amount or March 31, 2023;
NOW, THEREFORE,
in consideration of the mutual terms, conditions and other agreements set forth herein and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the parties hereto hereby
agree to the sale and purchase of the Notes as set forth herein.
For purposes of this Agreement, the terms set forth below
shall have the corresponding meanings provided below.
“Affiliate” shall mean, with
respect to any specified Person (as defined below), (i) if such Person is an individual, the spouse, heirs, executors, or legal
representatives of such individual, or any trusts for the benefit of such individual or such individual’s spouse and/or lineal
descendants, or (ii) otherwise, another Person that directly, or indirectly through one or more intermediaries, controls, is controlled
by, or is under common control with, the Person specified. As used in this definition, “control” shall mean the possession,
directly or indirectly, of the sole and unilateral power to cause the direction of the management and policies of a Person, whether
through the ownership of voting securities or by contract or other written instrument.
“Business
Day” shall mean any day on which banks located in New York City are not required or authorized by law to remain closed.
“Closing”
and “Closing Date” as defined in Section 2.3(a) hereof.
“Common Stock”
as defined in the recitals above.
“Company’s
Knowledge” means the actual knowledge of any executive officer (as defined in Rule 405 under the Securities Act) or director
of the Company, or the knowledge of any fact or matter which any person would reasonably be expected to become aware of in the
course of performing the duties and responsibilities as an executive officer or director of the Company.
“Conversion
Shares” means the shares of Common Stock issuable upon conversion of the Promissory Notes.
“Liens”
means any mortgage, lien, title claim, assignment, encumbrance, security interest, adverse claim, contract of sale, restriction
on use, or transfer or other defect of title of any kind.
“Material
Adverse Effect” means a material adverse effect on (i) the assets, liabilities, results of operations, condition (financial
or otherwise), business, or prospects of the Company and its Subsidiaries taken as a whole (ii) the transactions contemplated hereby
or in any of the Transaction Documents or (iii) the ability of the Company to perform its obligations under the Transaction Documents
(as defined below).
“Person”
shall mean an individual, entity, corporation, partnership, association, limited liability company, limited liability partnership,
joint-stock company, trust or unincorporated organization.
“Purchase
Price” as defined in the recitals above.
“Regulation
D” as defined in Section 3.7 hereof.
“Restricted
Common Stock” as defined in Section 2.1 hereof.
“Securities
Act” means the Securities Act of 1933, as amended.
“Subsidiaries”
and “Subsidiary” shall have the meaning as defined in Section 4.1(a).
“Transaction
Documents” shall mean this Agreement and the Promissory Notes.
“Transaction
Securities” shall mean the Promissory Notes, the Conversion Shares and the Restricted
Common Stock.
“Transfer”
shall mean any sale, transfer, assignment, conveyance, charge, pledge, mortgage, encumbrance, hypothecation, security interest
or other disposition, or to make or effect any of the above.
| 2. | Sale and Purchase of Promissory Notes. |
2.1 Subscription
for Promissory Notes by Investors. Subject to the terms and conditions of this Agreement, on each of the respective Closing
Dates (as hereinafter defined) each of the Investors shall severally, and not jointly, purchase, and the Company shall sell and
issue to the Investors, the Promissory Notes, in the respective amounts set forth on the signature pages attached hereto in exchange
for the Purchase Price. Subject to the terms and conditions of the Promissory Note, such Note shall have a term of twelve (12)
months, and can be converted into Conversion Shares at a fixed conversion price of $1.00 per share, subject to adjustment as set
forth in the Promissory Notes. Additionally, for each $1,000 of Notes purchased, the Company will issue to the Investor 750 shares
of restricted common stock, issuable upon payment of the Purchase Price, (the “Restricted Common Stock”).
The Offering shall terminate on the sooner of i) the sale
of the Maximum Offering Amount, ii) the termination by the Company at its sole discretion, or iii) March 31, 2023.
2.2 Conversion and Exercise Limitation.
Conversion is limited to the terms and conditions set forth in Section 2.1 and limited to the terms and conditions within the Convertible
Promissory Note in Exhibit A. Conversion is limited to the terms and conditions set forth in Section 2.1 and limited to the terms
and conditions within the Convertible Promissory Note in Exhibit A. Commencing as of the date first above written in the Convertible
Promissory Note, and until the sooner of the twelve (12) month anniversary of the Closing Date, the Investors shall not sell or
dispose of Common Stock of more than 5% of the daily composite trading volume of the Common Stock as reported by Bloomberg, LP
for any trading day for the principal trading market for the Common Stock.
2.3 Closings.
(a) Closing. Subject to the terms
and conditions set forth in this Agreement, the Company shall issue and sell to each Investor, and each Investor shall, severally
and not jointly, purchase from the Company on each of the respective Closing Dates, a Promissory Note in the amount set forth on
the signature pages attached hereto, which will be reflected opposite such Investor’s name on Annex A (the “Closing”).
The date of the Closing for each Investor is hereinafter referred to as the “Closing Date.”
(b) Rolling Closing. One or more closings
shall occur on the date and time agreed to with each Investor purchasing a Note and shall occur remotely via the exchange of documents
and signatures and wire transfers. Each Closing shall occur on the second Business Day following the date of this Agreement as
first above written.
2.4 Closing Deliveries. At
the Closing, the Company shall deliver to an Investor, against delivery by the Investor of the Purchase Price (as provided below)
a Promissory Note in the principal amount equivalent to the Purchase Price.
At the Closing,
each Investor shall deliver or cause to be delivered to the Company a copy of this Agreement duly signed by such Investor, a completed
accredited investor questionnaire (the “Accredited Investor Questionnaire”), substantially in the form attached herein
as Exhibit B, and the Purchase Price set forth in its counterpart signature page annexed hereto by paying United States
dollars in immediately available funds, to be sent to the Company pursuant to the wiring instruction attached herein as Exhibit
C.
| 3. | Representations, Warranties and Acknowledgments of the Investors. |
Each Investor, severally and not jointly,
represents and warrants to the Company solely as to such Investor that:
3.1 Authorization. The execution,
delivery and performance by such Investor of the Transaction Documents to which such Investor is a party have been duly authorized
and will each constitute the valid and legally binding obligation of such Investor, enforceable against such Investor in accordance
with their respective terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws
of general applicability, relating to or affecting creditors’ rights generally.
3.2 Purchase Entirely for Own Account.
The Transaction Securities to be received by such Investor hereunder will be acquired for such Investor’s own account, not
as nominee or agent, and not with a view to the resale or distribution of any part thereof in violation of the Securities Act,
and such Investor has no present intention of selling, granting any participation in, or otherwise distributing the same in violation
of the Securities Act, without prejudice, however, to such Investor’s right at all times to sell or otherwise dispose of
all or any part of such Transaction Securities in compliance with applicable federal and state securities laws. Nothing contained
herein shall be deemed a representation or warranty by such Investor to hold the Transaction Securities for any period of time.
Such Investor is not a broker-dealer registered with the SEC under the Exchange Act or an entity engaged in a business that would
require it to be so registered.
3.3 Investment Experience.
Such Investor acknowledges that the purchase of the Transaction Securities is a highly speculative investment and that it can bear
the economic risk and complete loss of its investment in the Transaction Securities and has such knowledge and experience in financial
or business matters such that it is capable of evaluating the merits and risks of the investment contemplated hereby.
3.4 Disclosure of Information.
Such Investor has had an opportunity to receive all information related to the Company and the Transaction Securities requested
by it and to ask questions of and receive answers from the Company regarding the Company, its business and the terms and conditions
of the offering of the Transaction Securities. Neither such inquiries nor any other due diligence investigation conducted by such
Investor shall modify, amend or affect such Investor’s right to rely on the Company’s representations and warranties
contained in this Agreement.
3.5 Restricted Securities.
Such Investor understands that the Transaction Securities are characterized as “restricted securities” under the U.S.
federal securities laws since they are being acquired from the Company in a transaction not involving a public offering and that
under such laws and applicable regulations such securities may be resold without registration under the Securities Act only in
certain limited circumstances.
3.6 Legends. The Investor understands
that, except as provided below, certificates evidencing the Conversion Shares will bear the following or any similar legend:
(a) “The securities represented
hereby may not be transferred unless (i) such securities have been registered for sale pursuant to the Securities Act of 1933,
as amended, (ii) such securities may be sold pursuant to an available exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act, or (iii) the Company has received an opinion of counsel reasonably satisfactory to it that
such transfer may lawfully be made without registration under the Securities Act of 1933 or qualification under applicable state
securities laws.”
(b) If required by the authorities
of any state in connection with the issuance of sale of the Transaction Securities, the legend required by such state authority.
3.7 Accredited Investor. Each
Investor is an accredited investor as defined in Rule 501(a) of Regulation D, as amended, under the Securities Act (“Regulation
D”) and the information provided in the Accredited Investor Questionnaire is accurate and complete as of the Closing Date.
3.8 No General Solicitation.
Such Investor did not learn of the investment in the Transaction Securities as a result of any public advertising or general solicitation.
3.9 Brokers and Finders. Except
the Broker, the Investor is not aware of any involvement of any other broker and finder for this Transaction. No Investor will
have, as a result of the transactions contemplated by the Transaction Documents, any valid right, interest or claim against or
upon the Company, any Subsidiary or any other Investor, for any commission, fee or other compensation pursuant to any agreement,
arrangement or understanding entered into by or on behalf of such Investor.
| 4. | Representations and Warranties of the Company. |
The Company represents, warrants and covenants to the
Investors that:
| 4.1 | Organization; Execution, Delivery and Performance. |
(a) The Company and each of its Subsidiaries,
if any, is a corporation or other entity duly organized, validly existing and in good standing under the laws of the jurisdiction
in which it is incorporated or organized, with full power and authority (corporate and other) to own, lease, use and operate its
properties and to carry on its business as and where now owned, leased, used, operated and conducted. The Company is duly qualified
as a foreign corporation to do business and is in good standing in every jurisdiction in which its ownership or use of property
or the nature of the business conducted by it makes such qualification necessary except where the failure to be so qualified or
in good standing would not have a Material Adverse Effect. As of the date of this Agreement, the Company owned and operated Subsidiaries.
(b) (i) The Company has all requisite
corporate power and authority to enter into and perform the Transaction Documents and to consummate the transactions contemplated
hereby and thereby and to issue the Transaction Securities, in accordance with the terms hereof and thereof, (ii) the execution
and delivery of the Transaction Documents by the Company and the consummation by the Company of the transactions contemplated hereby
and thereby (including without limitation, the issuance of the Transaction Securities) have been duly authorized by the Company’s
Board of Directors and no further consent or authorization of the Company, its Board of Directors, or its stockholders, is required,
(iii) each of the Transaction Documents has been duly executed and delivered by the Company by its authorized representative, and
such authorized representative is a true and official representative with authority to sign each such document and the other documents
or certificates executed in connection herewith and bind the Company accordingly, and (iv) each of the Transaction Documents constitutes,
and upon execution and delivery thereof by the Company will constitute, a legal, valid and binding obligation of the Company enforceable
against the Company in accordance with its terms, except to the extent limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other laws of general application affecting enforcement of creditors’ rights and general principles of equity
that restrict the availability of equitable or legal remedies.
4.2 Securities Duly Authorized.
The Transaction Securities to be issued to each Investor pursuant to this Agreement, when issued and delivered in accordance with
the terms of this Agreement, will be duly authorized and validly issued and will be fully paid and non-assessable and free from
all taxes or Liens with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights of stockholders
of the Company. Subject to the accuracy of the representations and warranties of the Investors party to this Agreement, the offer
and issuance by the Company of the Transaction Securities is exempt from registration under the Securities Act.
4.3 No Conflicts. The execution,
delivery and performance of the Transaction Documents by the Company and the consummation by the Company of the transactions contemplated
hereby and thereby (including without limitation, the issuance of the Transaction Securities) will not: (i) conflict with or result
in a violation of any provision of the Company’s Articles of Incorporation or By- laws, each as amended to date or (ii) violate
or conflict with, or result in a breach of any provision of, or constitute a default (or an event which with notice or lapse of
time or both could become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation
of, any agreement, indenture, patent, patent license or instrument, to which the Company or any of its Subsidiaries is a party
or by which any property or asset of the Company or any of its Subsidiaries is bound or affected or (iii) result in a violation
of any law, rule, regulation, order, judgment or decree (including federal and state securities laws and regulations and regulations
of any self-regulatory organizations to which the Company or its securities are subject) applicable to the Company or any of its
Subsidiaries or by which any property or asset of the Company or any of its Subsidiaries is bound or affected. Neither the Company
nor any of its Subsidiaries is in violation of its Articles of Incorporation, By-laws or other organizational documents, each as
amended to date. Neither the Company nor any of its Subsidiaries is in default (and no event has occurred which with notice or
lapse of time or both could put the Company or any of its Subsidiaries in default) under, and neither the Company nor any of its
Subsidiaries has taken any action or failed to take any action that would give to others any rights of termination, amendment,
acceleration or cancellation of, any agreement,
indenture or instrument to which the Company or any of its Subsidiaries is a party
or by which any property or assets of the Company or any of its Subsidiaries is bound or affected, or for possible defaults as
would not, individually or in the aggregate, have a Material Adverse Effect. Except as required under the Securities Act, the Exchange
Act and any applicable state securities laws, the Company is not required to obtain any consent, authorization or order of, or
make any filing or registration with, any court, governmental agency, regulatory agency, self-regulatory organization or stock
market or any third party in order for it to execute, deliver or perform any of its obligations under this Agreement or to issue
and sell the Transaction Securities in accordance with the terms hereof.
4.4 Capitalization. As of February
23, 2023 the authorized capital stock of the Company consisted of 300,000,000 shares of Common Stock, par value $0.001 per share.
As of February 23, 2023, there were 41,083,197 shares of Common Stock and 0 shares of Preferred Stock, issued and outstanding.
As of February 23, 2023 there were 17,711,333 shares of Common Stock reserved for issuance pursuant to the Company’s
outstanding options and 17,961,313 shares reserved for conversion of the Company’s outstanding convertible or exchangeable
securities.
4.5 Permits; Compliance. The
Company and each of its Subsidiaries is in possession of all franchises, grants, authorizations, licenses, permits, easements,
variances, exemptions, consents, certificates, approvals and orders necessary to own, lease and operate its properties and to carry
on its business as it is now being conducted (collectively, the “Company Permits”), and there is no action pending
or, to the knowledge of the Company, threatened regarding suspension or cancellation of any of the Company Permits. Neither the
Company nor any of its Subsidiaries is in conflict with, or in default or violation of, any of the Company Permits, except for
any such conflicts, defaults or violations which, individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect.
4.6 Litigation. Except as set
forth in Schedule 4.6 , to the Company’s knowledge there is no action, suit, claim, proceeding, inquiry or investigation
pending before or by any court, public board, government agency, self-regulatory organization or body or, to the Company’s
knowledge, threatened against or affecting the Company or any of its Subsidiaries, or their respective businesses, properties or
assets or their officers or directors in their capacity as such, that may reasonably be expected to have a Material Adverse Effect.
4.7 No General Solicitation.
Neither the Company nor any person participating on the Company’s behalf in the transactions contemplated hereby has conducted
any “general solicitation,” as such term is defined in Regulation D promulgated under the Securities Act, with respect
to any of the Transaction Securities being offered hereby.
4.8 No Integrated Offering.
Neither the Company, nor any of its Affiliates, nor any person acting on its or their behalf, has directly or indirectly made any
offers or sales in any security or solicited any offers to buy any security under circumstances that would require registration
under the Securities Act of the issuance of the Transaction Securities to the Investors. The issuance of the Transaction Securities
to the Investors will not be integrated with any other issuance of the Company’s securities (past, current or future) for
purposes of any stockholder approval provisions applicable to the Company or the Securities Act.
4.9 Intellectual Property.
The Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks, trademark applications,
service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights and similar
rights necessary or required for use in connection with their respective businesses and which the failure to so have could have
a Material Adverse Effect (collectively, the “Intellectual Property Rights”). None of, and neither the Company nor
any Subsidiary has received a notice (written or otherwise) that any of, the Intellectual Property Rights has expired, terminated
or been abandoned, or is expected to expire or terminate or be abandoned, within two (2) years from the date of this Agreement.
Neither the Company nor any Subsidiary has received, a written notice of a claim or otherwise has any knowledge that the Intellectual
Property Rights violate or infringe upon the rights of any Person, except as could not reasonably be expected to not have a Material
Adverse Effect. To the knowledge of the Company, all such Intellectual Property Rights are enforceable and there is no existing
infringement by another Person of any of the Intellectual Property Rights. The Company and its Subsidiaries have taken reasonable
security measures to protect the secrecy, confidentiality and value of all of their intellectual properties, except where failure
to do so could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
4.10 Financial Statements.
Copies of financial statements consisting of the balance sheet of the Company in each of the years ended December 31, 2021 and
2020 and the related statements of income and retained earnings and stockholders’ equity for the years then ended (the “Financial
Statements”) have been made available to Investor. The Financial Statements have been prepared in accordance with accounting
principles that the Company believes are reasonable for a company of its size and financial condition. The Company represents that
the Financial Statements fairly present in all material respects the financial condition of the Company as of the respective dates
they were prepared and the results of the operations of the Company for the periods indicated.
4.11 Tax Status. Except for
matters that would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect, the Company
and its Subsidiaries each (i) has made or filed all United States federal, state and local income and all foreign income and franchise
tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has paid all taxes and other governmental
assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations and
(iii) has set aside on its books provision reasonably adequate for the payment of all material taxes for periods subsequent to
the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material amount claimed to be
due by the taxing authority of any jurisdiction, and the officers of the Company or of any Subsidiary know of no basis for any
such claim.
4.12 Material Adverse Effect. Except
as expressly contemplated by this Agreement, from December 31, 2021 (the “Balance Sheet Date”) until the date of this
Agreement, the Company has operated its business in the ordinary course in all material respects and there has not been, with respect
to the business, and other than in the ordinary course of business, any:
(a) event,
occurrence or development that has had a Material Adverse Effect;
(b) incurrence
of any indebtedness for borrowed money in connection with the business in an aggregate amount exceeding $50,000, except unsecured
current obligations and liabilities incurred in the ordinary course of business;
(c) increase
in the compensation of any employees, other than as provided for in any written agreements or in the ordinary course of business;
(d) adoption,
termination, amendment or modification of any employee benefit plan;
(e) adoption
of any plan of merger, consolidation, reorganization, liquidation or dissolution or filing of a petition in bankruptcy under any
provisions of federal or state bankruptcy law or consent to the filing of any bankruptcy petition against it under any similar
law; or
(f) any
agreement to do any of the foregoing, or any action or omission that would result in any of the foregoing.
“Material
Adverse Effect” shall mean any event, occurrence, fact, condition or change that is materially adverse to (a) the business,
results of operations, financial condition or assets of the Company, taken as a whole, or (b) the ability of the Company to consummate
the transactions contemplated hereby; provided, however, that “Material Adverse Effect” shall not include any event,
occurrence, fact, condition or change, directly or indirectly, arising out of or attributable to: (i) general economic or political
conditions; (ii) conditions generally affecting the industries in which the Company operates; (iii) any changes in financial, banking
or securities markets in general, including any disruption thereof and any decline in the price of any security or any market index
or any change in prevailing interest rates; (iv) acts of war (whether or not declared), armed hostilities or terrorism, or the
escalation or worsening thereof; (v) any action required or permitted by this Agreement or any action taken (or omitted to be taken)
with the written consent of or at the written request of the Investor; (vi) any matter of which the Investor is aware on the date
hereof; (vii) any changes in applicable laws or accounting rules (including GAAP); (viii) any natural or man-made disaster or acts
of God; or (ix) any failure by the Company to meet any internal or published projections, forecasts or revenue or earnings predictions.
5. Registration
Rights The Company agrees that, within forty-five (45) calendar days after the Company has received the Purchase Price
that the Company will file with the SEC (at the Company’s sole cost and expense) a registration statement registering the
resale of the Conversion Shares and the Restricted Common Stock (the initial registration statement and any other registration
statement that may be filed by the Company under this Section, the “Registration Statement”), register the resale of
the Conversion Shares and the Restricted Common Stock no later than ninety (90) days after the Company has received the Purchase
Price and the Company shall use its commercially reasonable efforts to have the Registration Statement declared effective ninety
(90) days after the Registration Statement is filed.
6.1 Transfer or Resale. Each
Investor understands that the sale or resale of all or any portion of the Transaction Securities
have not been and is not being registered under the Securities Act or any applicable state securities laws, and all or any portion
of the Transaction Securities may not be transferred unless the Investor shall have delivered to the Company, at its own cost,
a customary opinion of counsel that shall be in form, substance and scope reasonably acceptable to the Company, to the effect that
the Transaction Securities to be sold or transferred may be sold or transferred pursuant to an exemption from such registration.
6.2 Shareholder Registry. If
an Investor provides the Company with a customary opinion of counsel, that shall be in form, substance and scope reasonably acceptable
to the Company, to the effect that a Transfer of such Transaction Securities may be made without registration under the Securities
Act and such sale or transfer is effected, the Company shall permit the Transfer and promptly record the Transfer on its shareholder
registry or, if the Company has a transfer agent, instruct its transfer agent to enter the Transfer in book-entry or issue one
or more certificates in such name and in such denominations as specified by such Investor.
| 7. | Conditions to Closing of the Investors. |
The obligation of each Investor hereunder
to purchase the Notes at the Closing is subject to the satisfaction, at or before the respective Closing Dates, of each of the
following conditions, provided that these conditions are for each Investor’s sole benefit and may be waived by such Investor
at any time in its sole discretion by providing the Company with prior written notice thereof:
7.1 Representations, Warranties
and Covenants. The representations and warranties of the Company shall be true and correct in all material respects as of the
date when made and as of the Closing Date as though originally made at that time (except for representations and warranties that
speak as of a specific date, which shall be true and correct in all material respects as of such date) and the Company shall have
performed, satisfied and complied in all material respects with the covenants, agreements and conditions required to be performed,
satisfied or complied with by the Company at or prior to the Closing Date.
7.2 Consents. The Company shall
have obtained all governmental, regulatory or third party consents and approvals, if any, necessary for the sale of the Promissory
Notes and Transaction Securities. In addition, the Company shall have delivered the consent of its Board of Directors for the Transactions
and issuances of the Promissory Notes and Transaction Securities.
7.3 Delivery by Company. The
Company shall have duly executed and delivered to such Investor (A) each of the other Transaction Documents such Investor is party
to and (B) copies by mail, fax or e-mail of the Notes being purchased by such Investor(s) pursuant to this Agreement as is set
forth on the signature page.
7.4 No Material Adverse Effect.
Since the date of first execution of this Agreement, no event or series of events shall have occurred that reasonably would have
or result in a Material Adverse Effect.
7.5 No Prohibition. No statute,
rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by any
court or governmental authority of competent jurisdiction that prohibits the consummation of any of the transactions contemplated
by the Transaction Documents.
7.6 Other Documents. The Company
shall have delivered to such Investor such other documents, instruments or certificates relating to the transactions contemplated
by this Agreement as such Investor or its counsel may reasonably request.
| 8. | Conditions to Closing of the Company. |
The obligations of the Company to effect
the transactions contemplated by this Agreement with each Investor are subject to the fulfillment at or prior to the Closing Date
of the conditions listed below.
8.1 Representations and Warranties.
The representations and warranties made by such Investor in Section 3 shall be true and correct in all material respects at the
time of such Closing as if made on and as of such date.
8.2 Corporate Proceedings.
All corporate and other proceedings required to be undertaken by such Investor in connection with the transactions contemplated
hereby shall have occurred and all documents and instruments incident to such proceedings shall be reasonably satisfactory in substance
and form to the Company.
8.3 Investor Deliveries. The
Company will have received the deliveries of the Investors set forth in Section 2.4.
9.1 Notices. All notices, requests,
demands and other communications provided in connection with this Agreement shall be in writing and shall be deemed to have been
duly given at the time when hand delivered, delivered by express courier, or sent by facsimile (with receipt confirmed by the sender’s
transmitting device) in accordance with the contact information provided below or such other contact information as the parties
may have duly provided by notice.
The Company:
Splash
Beverage Group, Inc.
1314
E. Las Olas Blvd, Suite 221
Fort
Lauderdale, Florida 33301
Attention:
Ron Wall, CFO
Email:
ronw@splashbeveragegroup.com |
With
a copy to: Sichenzia Ross Ference LLP
1185
Avenue of the Americans, 31st Floor
New
York, New York 10036
Telephone:
212-930-9700
Facsimile:
212-930-9275
Attention:
Darrin Ocasio, Esq.
Email:
dmocasio@srf.law |
The Investor:
As per the contact information provided on the signature
pages hereof.
9.2 Expenses. All costs and
expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring
such costs and expenses.
9.3 Entire Agreement. This
Agreement contains the entire agreement between the parties hereto in respect of the subject matter contained herein and supersedes
all prior agreements and understandings of the parties, oral and written, with respect to the subject matter contained herein.
9.4 Underlying Shares. The
Company agrees at all times as long as the Promissory Notes may be converted or exercised, to keep reserved from the authorized
and unissued Common Stock, such number of shares of Common Stock as may be issuable upon conversion of the Promissory Notes.
9.5 Third Party Beneficiaries.
This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns and is not
for the benefit of, nor may any provision hereof be enforced by, any other person.
9.6 Successors and Assigns.
This Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns. Neither the Company
nor any Investor shall assign this Agreement or any rights or obligations hereunder without the prior written consent of the other.
Notwithstanding the foregoing, but subject to the provisions of Section 6 hereof, any Investor may, without the consent of the
Company or any other Investor, assign its rights hereunder to any person that purchases Transaction Securities in a private transaction
from an Investor or to any of its Affiliates.
9.7 Binding Effect; Benefits.
This Agreement and all the provisions hereof shall be binding upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns; nothing in this Agreement, expressed or implied, is intended to confer on any persons other than
the parties hereto or their respective successors and permitted assigns, any rights, remedies, obligations or liabilities under
or by reason of this Agreement.
9.8 Amendment; Waivers. All
modifications, amendments or waivers to this Agreement shall require the written consent of both the Company and the holders of
the Promissory Notes.
9.9 Applicable Law; Disputes. This
Agreement and the Notes shall be governed by and construed in accordance with the laws of the State of New York, without giving
effect to its principles regarding conflicts of law. Each party agrees that all legal proceedings concerning the interpretation,
enforcement and defense of the transactions contemplated by any of the Transaction Documents (whether brought against a party hereto
or its respective Affiliates, directors, officers, shareholders, employees or agents) shall be commenced in the state and federal
courts sitting in the City of New York, Borough of Manhattan (the “New York Courts”). Each party hereto hereby irrevocably
submits to the exclusive jurisdiction of the New York Courts for the adjudication of any dispute hereunder or in connection herewith
or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction
Documents), 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 such New York Courts, or such New York Courts are improper or inconvenient venue for
such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any such
suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery)
to such party at the address in effect for notices to it under this Agreement or the Notes and agrees that such service shall constitute
good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any other manner permitted by applicable law. Each party hereto hereby irrevocably waives, to the fullest extent
permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement
or the Notes or the transactions contemplated hereby. If any party shall commence an action or proceeding to enforce any provisions
of this Agreement or the Notes, then the prevailing party in such action or proceeding shall be reimbursed by the other party for
its attorney’s fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action
or proceeding.
9.10 Further Assurances. Each
party hereto shall do and perform or cause to be done and performed all such further acts and shall execute and deliver all such
other agreements, certificates, instruments and documents as any other party hereto reasonably may request in order to carry out
the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.
9.11 Counterparts. This Agreement
may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which taken together
shall constitute one and the same instrument. This Agreement may also be executed via facsimile or email, which shall be deemed
an original.
9.12 Independent Nature of Investors.
The obligations of each Investor under this Agreement or other transaction document are several and not joint with the obligations
of any other Investor, and no Investor shall be responsible in any way for the performance of the obligations of any other Investor
under this Agreement or any other transaction document. Each Investor shall be responsible only for its own representations, warranties,
agreements and covenants hereunder. The decision of each Investor to purchase the Transaction Securities pursuant to this Agreement
has been made by such Investor independently of any other Investor and independently of any information, materials, statements
or opinions as to the business, affairs, operations,
assets, properties, liabilities, results of operations, condition (financial
or otherwise) or prospects of the Company which may have been made or given by any other Investor or by any agent or employee of
any other Investor, and no Investor or any of its agents or employees shall have any liability to any other Investor (or any other
person) relating to or arising from any such information, materials, statements or opinions. Nothing contained herein or in any
other transaction document, and no action taken by any Investor pursuant hereto or thereto, shall be deemed to constitute the Investors
as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Investors are in
any way acting in concert or as a group with respect to such obligations or the transactions contemplated by this Agreement. Except
as otherwise provided in this Agreement or any other transaction document, each Investor shall be entitled to independently protect
and enforce its rights arising out of this Agreement or out of the other transaction documents, and it shall not be necessary for
any other Investor to be joined as an additional party in any proceeding for such purpose. Each Investor has been represented by
its own separate legal counsel in connection with the transactions contemplated hereby.
[SIGNATURE PAGES IMMEDIATELY
FOLLOW]
IN WITNESS WHEREOF, the undersigned Investors and the Company
have caused this Securities Purchase Agreement to be duly executed as of the date first above written.
SPLASH BEVERAGE GROUP INC.
By: ______________________________________
Name: Robert Nistico
Title: CEO
|
INVESTORS:
The Investors executing the Signature Page in the form attached
hereto as Annex A and delivering the same to the Company or its agents shall be deemed to have executed this Agreement and agreed
to the terms hereof. |
Annex A
Securities Purchase Agreement Investor
Counterpart Signature Page
The undersigned, desiring to:
(i) enter into this Securities Purchase Agreement dated as of February 28, 2023 (the “Agreement”), with
the undersigned, SPLASH BEVERAGE GROUP, INC., a Nevada corporation (the “Company”), in or substantially
in the form furnished to the undersigned and (ii) purchase the Convertible Promissory Notes as set forth below, hereby agrees to
purchase such Notes from the Company as of the Closing and further agrees to join the Agreement as a party thereto, with all the
rights and privileges appertaining thereto, and to be bound in all respects by the terms and conditions thereof. The undersigned
specifically acknowledges having read the representations in the Agreement Section entitled “Representations, Warranties
and Acknowledgments of the Investors,” and hereby represents that the statements contained therein are complete and accurate
with respect to the undersigned as an Investor.
Name of Investor: |
|
If an entity: |
Name of Entity: |
|
By: |
Name: |
Title: |
Address: |
|
E-mail: |
Phone number: |
|
If an individual: |
Name: |
|
Title: |
Address: |
|
E-mail: |
Phone number: |
|
If joint individual: |
Name: |
EXHIBIT A
FORM OF CONVERTIBLE PROMISSORY NOTE
Sent under separate cover
EXHIBIT B
ACCREDITED INVESTOR QUESTIONNAIRE
Sent under separate cover
EXHIBIT C
WIRING INSTRUCTION
Sent under separate cover
17
EXHIBIT 10.2
SPLASH BEVERAGE GROUP, INC.
CONVERTIBLE PROMISSORY NOTE
Principal Amount: $2,000,000 (U.S. Dollars) Issuance
Date: February 28, 2023
This Convertible Promissory Note
(“Note”), one of a series of duly authorized and issued convertible promissory notes of Splash Beverage Group, Inc.,
a Nevada corporation (the “Company”), designated its Convertible Promissory Note (the “Notes”),
is issued to [ ] (together with its permitted successors and assigns, the “Holder”), pursuant to that a certain Securities
Purchase Agreement relating to the Notes (the “Purchase Agreement”), by and among the Company, the Holder and certain
other holders of Notes (collectively with the Holder, the “Holders”). Capitalized terms not otherwise defined herein
shall have the meanings ascribed to them in the Purchase Agreement. “Dollar” and “$” mean the lawful currency
of the United States of America.
1. PAYMENT
OF PRINCIPAL. (a) FOR VALUE RECEIVED, the Company hereby promises to pay to the Holder, in lawful money of the United States of America
and in immediately available funds the principal sum of $2,000,000 (the “Principal Amount”). The Principal Amount shall
be payable to the Holder on the Maturity Date, unless Holder elects to convert the Principal Amount into a certain number of shares of
the Company’s Common Stock pursuant to the terms of conversion described herein. If the first day of a month is not a Business Day,
the Company shall make the payment for the corresponding Principal Amount on the following day that is a Business Day.
2. DEFAULT.
a. Event
of Default. Each of the following events shall constitute an “Event of Default”:
i. the
Company’s failure to pay to the Holder any amount of Principal Amount, or other amounts when and as due under this Note, in which
case only if such failure remains uncured for a period of at least ten (10) days from the date when a written notice from the Holder regarding
the failure to pay the Principal Amount is given by the Holder of the Note, provided however, after Holder has delivered three notices
of failure to pay, any subsequent failure to pay shall constitute an immediate Event of Default with or without notice;
ii. bankruptcy,
insolvency, reorganization or liquidation proceedings or other proceedings for the relief of debtors shall be instituted by or against
the by a third party, shall not be dismissed within thirty (30) days of their initiation;
iii. the
commencement by the Company 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 as 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 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 of any substantial part
of their properties, 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 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;
iv. the
entry by a court of (i) a decree, order, judgment or other similar document in respect of the Company 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 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 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 of any substantial part of their 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 un-stayed and in effect for a period of thirty (30) consecutive days;
v. The
Company shall fail to maintain the listing of the Common Stock on the New York Stock Exchange American, which shall have no cure period;
vi. At
any time after the Issue Date, the Company shall fail to comply with the annual and quarterly reporting requirements on Form 10-K and
10-Q of the Securities Act of 1934 (the “1934 Act”) or the Company shall cease to be subject to the reporting requirements
of the 1934 Act, provided however, that the Company shall be deemed to have complied with its 1934 Act reporting obligations if such filing
is made within the time period covered by Rule 12b-25 promulgated under the 1934 Act. Notwithstanding the foregoing, the occurrence of
any event specified in Section 2(a)(vi) shall not be considered a trigger event if such event is cured within ten (10) Trading Days
of the occurrence thereof.
vii. If
upon the Maturity Date of any outstanding loans or notes payable held by the Company, including hereunder, the Company fails to pay any
then outstanding principal, interest, and fees due;
viii. Within
forty-five (45) calendar days after the Company has received the Principal Amount of the Note from the Holder, the Company will file with
the SEC (at the Company’s sole cost and expense) a registration statement registering the resale of the Conversion Shares and the
Restricted Common Stock (as defined in the Purchase Agreement); or
ix. The
Company fails to issue instructions to the transfer agent to issue the shares upon conversion of the Note within the agreed upon time
period determined by the Company and Holder. Notwithstanding the foregoing, the occurrence of any event specified in Section 2(a)(ix)
shall not be considered a trigger event if such event is cured within three (3) Trading Days of the occurrence thereof.
b. Notice
of an Event of Default. As soon as possible and in any event within seven (7) days after the Company becomes aware that an Event of
Default as set forth in Section 2(a)(ii)-(iv) has occurred and has not been cured, the Company shall notify the Holder in writing of the
nature, extent and time of and the facts surrounding such Event of Default, and the action, if any, that the Company proposes to take
with respect to such Event of Default.
c. Default
Interest Rate. Upon the occurrence of an Event of Default, the unpaid portion of the Principal Amount will bear simple interest from
the date of the Event of Default at a rate equal to eighteen percent (18.00%) per annum or the lower of permitted by New York law, for
the duration from such Event of Default till the cure of such Default or the repayment date of the entire outstanding balance of this
Note.
3. NONCIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not by amendment of its Articles of Incorporation (as amended), 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.
4. PREPAYMENT;
CONVERSION.
a. Voluntary
Prepayment. The Company may prepay the outstanding Principal Amount of this Note at any time, in whole or in part, without penalty
or prepayment.
b. Conversion.
At any time during the Conversion Period as defined below, the Holder may convert the unpaid and outstanding Principal Amount into shares
of the Company’s common stock (the “Common Stock”) at a conversion price (the “Conversion Price”) of $1.00
per share, subject to certain adjustments as set forth in Section 4(d). The Conversion Period shall commence on the Issuance Date and
end on the Maturity Date of this Note. Subject to the other provisions herein, this Note may be converted by the Holder in whole or in
part, on any Trading Day, while any amounts are outstanding hereunder, by submitting to the Company or Company’s transfer agent
a Notice of Conversion (by facsimile, e-mail or other reasonable means of communication dispatched on the Conversion Date prior to 11:59
p.m., New York, New York time). Any Notice of Conversion submitted after 11:59 p.m., New York, New York time, shall be deemed to have
been delivered and received on the next Trading Day.
Commencing as of the date first above written, and
until the sooner of the twelve (12) month anniversary of the Closing Date, the Holder shall not sell or dispose of Common Stock of more
than 5% of the daily composite trading volume of the Common Stock as reported by Bloomberg, LP for any trading day for the principal trading
market for the Common Stock.
c. Mechanics
of Conversion.
i. Conversion
Shares Issuable Upon Conversion. The number of shares issuable upon a conversion (the “Conversion Shares”) pursuant to
Section 4(b) hereunder shall be determined by the quotient obtained by dividing the outstanding Principal Amount of this Note, to be converted
by (y) the Conversion Price.
ii. Delivery
of Conversion Shares Upon Conversion. Not later than two (2) business days (the “Share Delivery Date”) after receiving
a conversion notice substantially in a form attached herein as Exhibit 1 (the “Notice of Conversion”), the Company shall deliver
to the their transfer agent instructions to issue shares, the transfer agent will cause to be delivered, to the Holder a certificate or
certificates representing the Conversion Shares or a share report of the Holder reflecting the issuance of Conversion Shares being acquired
upon the conversion of this Note within their normal business process, in whole or in part.
iii. Fractional
Shares. No fractional shares or scrip representing fractional shares shall be issued upon the conversion of this Note. As to any fraction
of a share which the Holder would otherwise be entitled to receive upon such conversion, the Company shall at its election, either pay
a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Conversion Price or round up
to the next whole share.
d. Certain
Adjustments.
i. Stock
Splits. If the Company, at any time while this Note is outstanding: (i) subdivides outstanding shares of Common Stock into a larger
number of shares, (ii) combines (including by way of a reverse stock split) outstanding shares of Common Stock into a smaller number of
shares or (iii) issues, in the event of a reclassification of shares of the Common Stock, any shares of capital stock of the Company,
then the Conversion Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding
any treasury shares of the Company) outstanding immediately before such event, and of which the denominator shall be the number of shares
of Common Stock outstanding immediately after such event. Any adjustment made pursuant to this Section 4(d) shall become effective immediately
after the record date for the determination of stockholders entitled to receive such distribution and shall become effective immediately
after the effective date in the case of a subdivision, combination or re classification.
ii. Most
Favored Nation Status. If the Company or any subsidiary thereof, as applicable, at any time while this Note is outstanding or the
Holder holds any Conversion Shares, shall sell or grant any option to purchase, or sell or grant any right to reprice, or otherwise dispose
of or issue (or announce any offer, sale, grant or any option to purchase or other disposition) any Common Stock or Common Stock Equivalents,
at an effective price per share less than the Conversion Price then
iii. Notice
of Adjustment to Conversion Price. Whenever the Conversion Price is adjusted pursuant to this Section 4(d), the Company shall promptly
deliver to each Holder a notice setting forth the new Conversion Price with three (3) Business Days after such adjustment and setting
forth a brief statement of the facts requiring such adjustment. Failure to provide such notice shall not constitute an Event of Default.
5. COVENANTS.
Until so long as no Principal Amount remains outstanding:
a. Preservation
of Existence. The Company shall maintain and preserve its existence, rights and privileges, and become or remain duly qualified and
in good standing in each jurisdiction in which the character of the properties owned or leased by the Company or in which the transaction
of its business makes such qualification necessary.
b. Public
Filings. The Company shall use its best efforts to maintain its periodic filings required by the Securities Exchange Act of 1934,
as amended (the “Exchange Act”) and keep its Common Stock quoted or tractable on the OTC Markets or another United States
stock exchange or market.
6. BENEFICIAL
OWNERSHIP. The Company shall not effect any conversion of this Note, and a Holder shall not have the right to convert any portion
of this Note, to the extent that after giving effect to the conversion set forth on the applicable Notice of Conversion, the Holder (together
with its Affiliates, and any Persons acting as a group together with the Holder or any of its Affiliates) would beneficially own in excess
of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of shares of Common Stock
beneficially owned by the Holder and its Affiliates shall include the number of shares of Common Stock issuable upon conversion of this
Note with respect to which such determination is being made, but shall exclude the number of shares of Common Stock which are issuable
upon (i) conversion of the remaining, unconverted amount of this Note beneficially owned by the Holder or any of its Affiliates and (ii)
exercise or conversion of the unexercised or unconverted portion of any other securities of the Company subject to a limitation on conversion
or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates. Except as set forth
in the preceding sentence, for purposes of this Section 6, beneficial ownership shall be calculated in accordance with Section 13(d) of
the Exchange Act and the rules and regulations promulgated thereunder. To the extent that the limitation contained in this Section 6 applies,
the determination of whether this Note is convertible (in relation to other securities owned by the Holder together with any Affiliates)
and of which amount of this Note is convertible shall be in the sole discretion of the Holder, and the submission of a Notice of Conversion
shall be deemed to be the Holder’s determination of whether this Note may be converted (in relation to other securities owned by
the Holder together with any Affiliates) and which amount of this Note is convertible, in each case subject to the Beneficial Ownership
Limitation. To ensure compliance with this restriction, the Holder will be deemed to represent to the Company each time it delivers a
Notice of Conversion that such Notice of Conversion has not violated the restrictions set forth in this paragraph and the Company shall
have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as
contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated
thereunder. For purposes of this Section 6, in determining the number of outstanding shares of Common Stock, the Holder may rely on the
number of outstanding shares of Common Stock as stated in the most recent of the following: (i) the Company’s most recent periodic
or annual report filed with the Commission, as the case may be, (ii) a more recent public announcement by the Company, or (iii) a more
recent written notice by the Company or the Company’s transfer agent setting forth the number of shares of Common Stock outstanding.
Upon the written or oral request of a Holder, the Company shall within two (2) Trading Days confirm orally and in writing to the Holder
the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined
after giving effect to the conversion or exercise of securities of the Company, including this Note, by the Holder or its Affiliates since
the date as of which such number of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation”
shall not exceed 1% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares
of Common Stock issuable upon conversion of this Note held by the Holder. The Holder, upon not less than 61 days prior notice to the Company,
may increase or decrease the Beneficial Ownership Limitation provisions of this Section 6, provided that the Beneficial Ownership Limitation
in no event exceeds 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares
of Common Stock upon conversion of this Note held by the Holder and the Beneficial Ownership Limitation provisions of this Section 6 shall
continue to apply. Any such increase or decrease will not be effective until the 61st day after such notice is delivered
to the Company. The Beneficial Ownership Limitation provisions of this paragraph shall be construed and implemented in a manner otherwise
than in strict conformity with the terms of this Section 6 to correct this paragraph (or any portion hereof) which may be defective or
inconsistent with the intended Beneficial Ownership Limitation contained herein or to make changes or supplements necessary or desirable
to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Note.
7. AMENDMENTS.
No modification, amendment or waiver of any provision of this Note shall be effective unless in writing and approved by the Company and
the Holder.
8. RESTRICTIONS
ON TRANSFER. This Note may not be offered, sold, assigned or transferred by the Holder without the explicit written consent of the
Company, which may be granted or withheld at the sole discretion of the Company.
9. REISSUANCE
OF THIS NOTE.
a. Transfer.
If this Note is to be transferred with the Company’s approval as provided in Section 8, 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
9(c)) registered as the Holder may request, representing the outstanding Principal Amount being transferred by the Holder and, if less
than the entire outstanding Principal Amount is being transferred, a new Note (in accordance with Section 9(c)) to the Holder representing
the outstanding Principal Amount not being transferred. The Holder and any assignee, by acceptance of this Note, acknowledge and agree
that, by reason of prepayment or conversion of any portion of this Note, the outstanding Principal Amount represented by this Note may
be less than the Principal Amount 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 9(c)) representing the outstanding Principal Amount.
c. 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 Amount remaining outstanding
(or in the case of a new Note being issued pursuant to Section 9(a), the Principal Amount 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 Amount 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 Issuance Date of this Note, and (iv) shall have the same rights and conditions as this Note.
10. 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.
11. LEGEND.
The Holder understands and agrees that the Conversion Shares upon issuance shall be restrictive and, if represented by a certificate(s),
shall bear substantially the following legend until (i) such Conversion Shares shall have been registered under the Securities Act and
effectively disposed of in accordance with a registration statement that has been declared effective or (ii) in the opinion of counsel
acceptable to the Company, such Conversion Shares may be sold in reliance on an available exemption without registration under the Securities
Act, as well as any applicable “blue sky” or state securities laws:
‘THE SHARES REPRESENTED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY APPLICABLE STATE SECURITIES
LAWS. SUCH SHARES HAVE BEEN ACQUIRED FOR INVESTMENT PURPOSES AND MAY NOT BE OFFERED FOR SALE, SOLD, DELIVERED AFTER SALE, TRANSFERRED,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FILED BY THE ISSUER WITH THE U.S. SECURITIES AND EXCHANGE
COMMISSION COVERING SUCH SHARES UNDER THE SECURITIES ACT OR AN OPINION OF COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.”
12. CONSTRUCTION;
HEADINGS.This Note shall be deemed to be jointly drafted by the Company and the Holder and shall not be construed against any 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. Terms used in this Note but defined in the other Transaction Documents shall have the meanings ascribed to such terms
on the Closing Date in such other Transaction Documents unless otherwise consented to in writing by the Holder.
13. 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.
14. NOTICES;
CURRENCY; PAYMENTS.
a. Notices.
Any notice or other communication required or permitted to be given hereunder shall be in writing sent by mail, facsimile with printed
confirmation, nationally recognized overnight carrier or personal delivery and shall be effective upon actual receipt of such notice,
to the following addresses until notice is received that any such address or contact information has been changed:
To the Company:
Splash Beverage Group, Inc.
1314 East Las Olas Blvd., Suite 221
Fort Lauderdale, Florida 33316
Attn: Robert Nistico
With another copy (which shall not constitute
Notice) to:
Sichenzia Ross Ference LLP
1185 Avenue of the Americas, 31st Floor
New York, NY 10036
Facsimile: 212-930-9725
Attn: Darrin M. Ocasio
To the Holder:
Address:
Attention:
With another copy (which shall not constitute
Notice) to:
Name:
Address:
Attention:
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.
c. Payments.
The Company will make all payments under this Note by wire transfer of immediately available funds to the bank account specified by the
Holder in written notice delivered to the Company on or before each Repayment Date.
15. CANCELLATION.
After the Principal amount, and other amounts at any time owed on this Note have been paid in full or converted in full, this Note shall
automatically be deemed canceled, shall be surrendered to the Company for cancellation and shall not be reissued.
16. WAIVER
OF JURY TRIAL. Each party hereby waives its right to a jury trial in connection with any suit, action or proceeding in connection
with any matter relating to this Note.
17. GOVERNING
LAW. This Note shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to its
principles regarding conflicts of law.
18. 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.
19. CERTAIN
DEFINITIONS. For purposes of this Note, the following terms shall have the following meanings:
“Affiliate” means any
Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a
Person, as such terms are used in and construed under Rule 405 under the Securities Act.
“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.
“Common Stock Equivalents”
means any securities of the Company or any subsidiary which would entitle the holder thereof to acquire at any time Common Stock, including,
without limitation, any debt, preferred stock, right, option, warrant, unit, or other instrument that is at any time convertible into
or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.
“Exempt Issuance” means
the issuance of (a) shares of Common Stock or options to employees, officers, directors, advisors or independent contractors of the Company;
provided. however, that such issuance is approved by a majority of the board of directors of the Company, (b) shares of Common Stock,
warrants or options to advisors or independent contractors of the Company for compensatory purposes, (c) securities upon the exercise
or exchange of or conversion of any securities issued hereunder and/or other securities exercisable or exchangeable for or convertible
into shares of Common Stock issued and outstanding on the date hereof, provided that such securities have not been amended since the date
hereof to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities,
(d) securities issuable pursuant to any contractual anti-dilution obligations of the Company in effect as of the date hereof, provided
that such obligations have not been materially amended since the date of hereof, and (e) securities issued pursuant to acquisitions or
any other strategic transactions approved by a majority of the disinterested members of the Board of Directors, provided that any such
issuance shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to
an entity whose primary business is investing in securities.
“Maturity Date” shall
mean February 28, 2024.
“Person” means “person”
as such term is used for purposes of Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended, including any individual,
corporation, limited liability company, partnership, trust, unincorporated organization, government or any agency or political subdivision
thereof, or any other entity or any group of persons.
“Securities Act” means
the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. “Trading Day” means a day on
which the principal Trading Market is open for trading.
“Trading Market” means
any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE
American; the Nasdaq Capital Market; the Nasdaq Global Market; the Nasdaq Global Select Market; the New York Stock Exchange; any level
of the OTC Markets operated by OTC Markets Group, Inc. or the OTC Bulletin Board (or any successors to any of the foregoing).
“Transaction Documents”
means, collectively, this Note, the Purchase Agreement, between the Company and the Holder dated February 28, 2023, and the other agreements
and instruments entered into or delivered by any of the parties hereto in connection with the transactions contemplated by the Purchase
Agreement, as may be amended from time to time.
[Signature Page Follows]
[SIGNATURE PAGE TO THE CONVERTIBLE PROMISSORY NOTE]
IN WITNESS WHEREOF, the Company has caused
this Note to be duly executed as of the Issuance Date set out above.
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COMPANY: |
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Splash Beverage Group, Inc. |
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(A Nevada Corporation) |
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By: |
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Name Robert Nistico |
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Title: CEO |
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HOLDER: |
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By: |
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Entity: |
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Name: |
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Title: |
EXHIBIT 1
Form of Notice of Conversion
Splash Beverage Group, Inc.
1314 East Las Olas Blvd., Suite 221
Fort Lauderdale, Florida 33316
Attn: Chief Financial Officer
The undersigned hereby elects to
convert certain outstanding amount as set forth below of the Convertible Promissory Note of Splash Beverage Group, Inc., a Nevada corporation
(the “Company”), issuance date February _____, 2023, into shares of common stock (the “Common Stock”), of the
Company according to the conditions hereof, as of the date written below. If shares of Common Stock are to be issued in the name of a
person other than the undersigned, the undersigned will pay all transfer taxes payable with respect thereto and is delivering herewith
such certificates and opinions as reasonably requested by the Company in accordance therewith. No fee will be charged to the holder for
any conversion, except for such transfer taxes, if any.
The undersigned agrees to comply
with the delivery requirements under the applicable securities laws in connection with any transfer of the aforesaid shares of Common
Stock.
Conversion calculations:
Principal Amount of Note to be
Converted: $
Conversion Price per Share: $
Number of Shares of Common Stock
to be Issued upon Conversion:
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Signature: |
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Name (Print): |
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Mailing Address: |
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Date: |
EXHIBIT 10.3
SPLASH BEVERAGE GROUP, INC.
CONVERTIBLE PROMISSORY NOTE
Principal Amount: $1,100,000 (U.S. Dollars) |
Issuance Date: August X, 2023 |
This Convertible Promissory Note
(“Note”), one of a series of duly authorized and issued convertible promissory notes of Splash Beverage Group, Inc.,
a Nevada corporation (the “Company”), designated its Convertible Promissory Note (the “Notes”),
is issued to Target Capital 12 LLC (together with its permitted successors and assigns, the “Holder”), pursuant to
that a certain Securities Purchase Agreement relating to the Notes (the “Purchase Agreement”), by and among the Company,
the Holder and certain other holders of Notes (collectively with the Holder, the “Holders”). Capitalized terms not
otherwise defined herein shall have the meanings ascribed to them in the Purchase Agreement. “Dollar” and “$”
mean the lawful currency of the United States of America.
1. PAYMENT
OF PRINCIPAL. (a) FOR VALUE RECEIVED, the Company hereby promises to pay to the Holder, in lawful money of the United States of America
and in immediately available funds the principal sum of $1,100,000 (the “Principal Amount”). The Principal Amount shall
be payable to the Holder on the Maturity Date, unless Holder elects to convert the Principal Amount into a certain number of shares of
the Company’s Common Stock pursuant to the terms of conversion described herein. If the first day of a month is not a Business Day,
the Company shall make the payment for the corresponding Principal Amount on the following day that is a Business Day.
2. DEFAULT.
a. Event
of Default. Each of the following events shall constitute an “Event of Default”:
i. the
Company’s failure to pay to the Holder any amount of Principal Amount, or other amounts when and as due under this Note, in which
case only if such failure remains uncured for a period of at least ten (10) days from the date when a written notice from the Holder regarding
the failure to pay the Principal Amount is given by the Holder of the Note, provided however, after Holder has delivered three notices
of failure to pay, any subsequent failure to pay shall constitute an immediate Event of Default with or without notice;
ii. bankruptcy,
insolvency, reorganization or liquidation proceedings or other proceedings for the relief of debtors shall be instituted by or against
the by a third party, shall not be dismissed within thirty (30) days of their initiation;
iii. the
commencement by the Company 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 as 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 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 of any substantial part
of their properties, 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 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;
iv. the
entry by a court of (i) a decree, order, judgment or other similar document in respect of the Company 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 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 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 of any substantial part of their 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 un-stayed and in effect for a period of thirty (30) consecutive days;
v. The
Company shall fail to maintain the listing of the Common Stock on the New York Stock Exchange American, which shall have no cure period;
vi. At
any time after the Issue Date, the Company shall fail to comply with the annual and quarterly reporting requirements on Form 10-K and
10-Q of the Securities Act of 1934 (the “1934 Act”) or the Company shall cease to be subject to the reporting requirements
of the 1934 Act, provided however, that the Company shall be deemed to have complied with its 1934 Act reporting obligations if such filing
is made within the time period covered by Rule 12b-25 promulgated under the 1934 Act. Notwithstanding the foregoing, the occurrence of
any event specified in Section 2(a)(vi) shall not be considered a trigger event if such event is cured within ten (10) Trading Days
of the occurrence thereof.
vii. If
upon the Maturity Date of any outstanding loans or notes payable held by the Company, including hereunder, the Company fails to pay any
then outstanding principal, interest, and fees due;
viii. Within
forty-five (45) calendar days after the Company has received the Principal Amount of the Note from the Holder, the Company will file with
the SEC (at the Company’s sole cost and expense) a registration statement registering the resale of the Conversion Shares and the
Restricted Common Stock (as defined in the Purchase Agreement); or
ix. The
Company fails to issue instructions to the transfer agent to issue the shares upon conversion of the Note within the agreed upon time
period determined by the Company and Holder. Notwithstanding the foregoing, the occurrence of any event specified in Section 2(a)(ix)
shall not be considered a trigger event if such event is cured within three (3) Trading Days of the occurrence thereof.
b. Notice
of an Event of Default. As soon as possible and in any event within seven (7) days after the Company becomes aware that an Event of
Default as set forth in Section 2(a)(ii)-(iv) has occurred and has not been cured, the Company shall notify the Holder in writing of the
nature, extent and time of and the facts surrounding such Event of Default, and the action, if any, that the Company proposes to take
with respect to such Event of Default.
c. Default
Interest Rate. Upon the occurrence of an Event of Default, the unpaid portion of the Principal Amount will bear simple interest from
the date of the Event of Default at a rate equal to eighteen percent (18.00%) per annum or the lower of permitted by New York law, for
the duration from such Event of Default till the cure of such Default or the repayment date of the entire outstanding balance of this
Note.
3. NONCIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not by amendment of its Articles of Incorporation (as amended), 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.
4. PREPAYMENT;
CONVERSION.
a. Voluntary
Prepayment. The Company may prepay the outstanding Principal Amount of this Note at any time, in whole or in part, without penalty
or prepayment.
b. Conversion.
At any time during the Conversion Period as defined below, the Holder may convert the unpaid and outstanding Principal Amount into shares
of the Company’s common stock (the “Common Stock”) at a conversion price (the “Conversion Price”) of $1.00
per share, subject to certain adjustments as set forth in Section 4(d). The Conversion Period shall commence on the Issuance Date and
end on the Maturity Date of this Note. Subject to the other provisions herein, this Note may be converted by the Holder in whole or in
part, on any Trading Day, while any amounts are outstanding hereunder, by submitting to the Company or Company’s transfer agent
a Notice of Conversion (by facsimile, e-mail or other reasonable means of communication dispatched on the Conversion Date prior to 11:59
p.m., New York, New York time). Any Notice of Conversion submitted after 11:59 p.m., New York, New York time, shall be deemed to have
been delivered and received on the next Trading Day.
Commencing as of the date first above written, and
until the sooner of the twelve (12) month anniversary of the Closing Date, the Holder shall not sell or dispose of Common Stock of more
than 20% of the daily composite trading volume of the Common Stock as reported by Bloomberg, LP for any trading day for the principal
trading market for the Common Stock.
c. Mechanics
of Conversion.
i. Conversion
Shares Issuable Upon Conversion. The number of shares issuable upon a conversion (the “Conversion Shares”) pursuant to
Section 4(b) hereunder shall be determined by the quotient obtained by dividing the outstanding Principal Amount of this Note, to be converted
by (y) the Conversion Price.
ii. Delivery
of Conversion Shares Upon Conversion. Not later than two (2) business days (the “Share Delivery Date”) after receiving
a conversion notice substantially in a form attached herein as Exhibit 1 (the “Notice of Conversion”), the Company shall deliver
to the their transfer agent instructions to issue shares, the transfer agent will cause to be delivered, to the Holder a certificate or
certificates representing the Conversion Shares or a share report of the Holder reflecting the issuance of Conversion Shares being acquired
upon the conversion of this Note within their normal business process, in whole or in part.
iii. Fractional
Shares. No fractional shares or scrip representing fractional shares shall be issued upon the conversion of this Note. As to any fraction
of a share which the Holder would otherwise be entitled to receive upon such conversion, the Company shall at its election, either pay
a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Conversion Price or round up
to the next whole share.
d. Certain
Adjustments.
i. Stock
Splits. If the Company, at any time while this Note is outstanding: (i) subdivides outstanding shares of Common Stock into a larger
number of shares, (ii) combines (including by way of a reverse stock split) outstanding shares of Common Stock into a smaller number of
shares or (iii) issues, in the event of a reclassification of shares of the Common Stock, any shares of capital stock of the Company,
then the Conversion Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding
any treasury shares of the Company) outstanding immediately before such event, and of which the denominator shall be the number of shares
of Common Stock outstanding immediately after such event. Any adjustment made pursuant to this Section 4(d) shall become effective immediately
after the record date for the determination of stockholders entitled to receive such distribution and shall become effective immediately
after the effective date in the case of a subdivision, combination or re classification.
ii. Most
Favored Nation Status. If the Company or any subsidiary thereof, as applicable, at any time while this Note is outstanding or
the Holder holds any Conversion Shares, shall sell or grant any option to purchase, or sell or grant any right to reprice, or
otherwise dispose of or issue (or announce any offer, sale, grant or any option to purchase or other disposition) any Common Stock
or Common Stock Equivalents, at an effective price per share less than the Conversion Price then in effect (such lower price, the
“Base Share Price” and such issuances collectively, a “Dilutive Issuance”) (it being understood and agreed
that if the holder of the Common Stock or Common Stock Equivalents so issued shall at any time, whether by operation of purchase
price adjustments, reset provisions, floating conversion, exercise or exchange prices or otherwise, or due to warrants, options or
rights per share which are issued in connection with such issuance, be entitled to receive Common Stock at an effective price per
share that is less than the Conversion Price, such issuance shall be deemed to have occurred for less than the Conversion Price on
such date of the Dilutive Issuance at such effective price), then simultaneously with the consummation of each Dilutive Issuance the
Conversion Price shall be reduced and only reduced to equal the Base Share Price. Such adjustment shall be made whenever such Common
Stock or Common Stock Equivalents are issued. Notwithstanding the foregoing, no adjustments shall be made, paid or issued under this
Section in respect of an Exempt Issuance. The Company shall notify the Holder, in writing, no later than the Trading Day following
the issuance or deemed issuance of any Common Stock or Common Stock Equivalents subject to this Section, indicating therein the
applicable issuance price, or applicable reset price, exchange price, conversion price and other pricing terms (such notice, the
“Dilutive Issuance Notice”). For purposes of clarification, whether or not the Company provides a Dilutive Issuance
Notice pursuant to this Section, upon the occurrence of any Dilutive Issuance, the Holder is entitled to receive a number of
Conversion Shares based upon the Base Share Price regardless of whether the Holder accurately refers to the Base Share Price in the
Notice of Conversion. Notwithstanding anything to the contrary herein, the Company shall not issue any shares of Common Stock
pursuant to this Section if to do so would require the Company to obtain approval of its shareholders under the applicable rules of
the NYSE American and as such the Company shall only issue such number of shares of common stock as would not require the Company to
obtain shareholder approval under the applicable rules of the NYSE American.
iii. Notice
of Adjustment to Conversion Price. Whenever the Conversion Price is adjusted pursuant to this Section 4(d), the Company shall promptly
deliver to each Holder a notice setting forth the new Conversion Price with three (3) Business Days after such adjustment and setting
forth a brief statement of the facts requiring such adjustment. Failure to provide such notice shall not constitute an Event of Default.
5. COVENANTS.
Until so long as no Principal Amount remains outstanding:
a. Preservation
of Existence. The Company shall maintain and preserve its existence, rights and privileges, and become or remain duly qualified and
in good standing in each jurisdiction in which the character of the properties owned or leased by the Company or in which the transaction
of its business makes such qualification necessary.
b. Public
Filings. The Company shall use its best efforts to maintain its periodic filings required by the Securities Exchange Act of 1934,
as amended (the “Exchange Act”) and keep its Common Stock quoted or tractable on the OTC Markets or another United States
stock exchange or market.
6. BENEFICIAL
OWNERSHIP. The Company shall not effect any conversion of this Note, and a Holder shall not have the right to convert any portion
of this Note, to the extent that after giving effect to the conversion set forth on the applicable Notice of Conversion, the Holder (together
with its Affiliates, and any Persons acting as a group together with the Holder or any of its Affiliates) would beneficially own in excess
of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of shares of Common Stock
beneficially owned by the Holder and its Affiliates shall include the number of shares of Common Stock issuable upon conversion of this
Note with respect to which such determination is being made, but shall exclude the number of shares of Common Stock which are issuable
upon (i) conversion of the remaining, unconverted amount of this Note beneficially owned by the Holder or any of its Affiliates and (ii)
exercise or conversion of the unexercised or unconverted portion of any other securities of the Company subject to a limitation on conversion
or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates. Except as set forth
in the preceding sentence, for purposes of this Section 6, beneficial ownership shall be calculated in accordance with Section 13(d) of
the Exchange Act and the rules and regulations promulgated thereunder. To the extent that the limitation contained in this Section 6 applies,
the determination of whether this Note is convertible (in relation to other securities owned by the Holder together with any Affiliates)
and of which amount of this Note is convertible shall be in the sole discretion of the Holder, and the submission of a Notice of Conversion
shall be deemed to be the Holder’s determination of whether this Note may be converted (in relation to other securities owned by
the Holder together with any Affiliates) and which amount of this Note is convertible, in each case subject to the Beneficial Ownership
Limitation. To ensure compliance with this restriction, the Holder will be deemed to represent to the Company each time it delivers a
Notice of Conversion that such Notice of Conversion has not violated the restrictions set forth in this paragraph and the Company shall
have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as
contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated
thereunder. For purposes of this Section 6, in determining the number of outstanding shares of Common Stock, the Holder may rely on the
number of outstanding shares of Common Stock as stated in the most recent of the following: (i) the Company’s most recent periodic
or annual report filed with the Commission, as the case may be, (ii) a more recent public announcement by the Company, or (iii) a more
recent written notice by the Company or the Company’s transfer agent setting forth the number of shares of Common Stock outstanding.
Upon the written or oral request of a Holder, the Company shall within two (2) Trading Days confirm orally and in writing to the Holder
the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined
after giving effect to the conversion or exercise of securities of the Company, including this Note, by the Holder or its Affiliates since
the date as of which such number of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation”
shall not exceed 1% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares
of Common Stock issuable upon conversion of this Note held by the Holder. The Holder, upon not less than 61 days prior notice to the Company,
may increase or decrease the Beneficial Ownership Limitation provisions of this Section 6, provided that the Beneficial Ownership Limitation
in no event exceeds 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares
of Common Stock upon conversion of this Note held by the Holder and the Beneficial Ownership Limitation provisions of this Section 6 shall
continue to apply. Any such increase or decrease will not be effective until the 61st day after such notice is delivered
to the Company. The Beneficial Ownership Limitation provisions of this paragraph shall be construed and implemented in a manner otherwise
than in strict conformity with the terms of this Section 6 to correct this paragraph (or any portion hereof) which may be defective or
inconsistent with the intended Beneficial Ownership Limitation contained herein or to make changes or supplements necessary or desirable
to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Note.
7. AMENDMENTS.
No modification, amendment or waiver of any provision of this Note shall be effective unless in writing and approved by the Company and
the Holder.
8. RESTRICTIONS
ON TRANSFER. This Note may not be offered, sold, assigned or transferred by the Holder without the explicit written consent of the
Company, which may be granted or withheld at the sole discretion of the Company.
9. REISSUANCE
OF THIS NOTE.
a. Transfer.
If this Note is to be transferred with the Company’s approval as provided in Section 8, 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
9(c)) registered as the Holder may request, representing the outstanding Principal Amount being transferred by the Holder and, if less
than the entire outstanding Principal Amount is being transferred, a new Note (in accordance with Section 9(c)) to the Holder representing
the outstanding Principal Amount not being transferred. The Holder and any assignee, by acceptance of this Note, acknowledge and agree
that, by reason of prepayment or conversion of any portion of this Note, the outstanding Principal Amount represented by this Note may
be less than the Principal Amount 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 9(c)) representing the outstanding Principal Amount.
c. 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 Amount remaining outstanding
(or in the case of a new Note being issued pursuant to Section 9(a), the Principal Amount 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 Amount 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 Issuance Date of this Note, and (iv) shall have the same rights and conditions as this Note.
10. 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.
11. LEGEND.
The Holder understands and agrees that the Conversion Shares upon issuance shall be restrictive and, if represented by a certificate(s),
shall bear substantially the following legend until (i) such Conversion Shares shall have been registered under the Securities Act and
effectively disposed of in accordance with a registration statement that has been declared effective or (ii) in the opinion of counsel
acceptable to the Company, such Conversion Shares may be sold in reliance on an available exemption without registration under the Securities
Act, as well as any applicable “blue sky” or state securities laws:
‘THE SHARES REPRESENTED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY APPLICABLE STATE SECURITIES
LAWS. SUCH SHARES HAVE BEEN ACQUIRED FOR INVESTMENT PURPOSES AND MAY NOT BE OFFERED FOR SALE, SOLD, DELIVERED AFTER SALE, TRANSFERRED,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FILED BY THE ISSUER WITH THE U.S. SECURITIES AND EXCHANGE
COMMISSION COVERING SUCH SHARES UNDER THE SECURITIES ACT OR AN OPINION OF COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.”
12. CONSTRUCTION;
HEADINGS.This Note shall be deemed to be jointly drafted by the Company and the Holder and shall not be construed against any 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. Terms used in this Note but defined in the other Transaction Documents shall have the meanings ascribed to such terms
on the Closing Date in such other Transaction Documents unless otherwise consented to in writing by the Holder.
13. 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.
14. NOTICES;
CURRENCY; PAYMENTS.
a. Notices.
Any notice or other communication required or permitted to be given hereunder shall be in writing sent by mail, facsimile with printed
confirmation, nationally recognized overnight carrier or personal delivery and shall be effective upon actual receipt of such notice,
to the following addresses until notice is received that any such address or contact information has been changed:
To the Company:
Splash Beverage Group, Inc.
1314 East Las Olas Blvd., Suite 221
Fort Lauderdale, Florida 33316
Attn: Robert Nistico
With another copy (which shall not constitute
Notice) to:
Sichenzia Ross Ference LLP
1185 Avenue of the Americas, 31st Floor
New York, NY 10036
Facsimile: 212-930-9725
Attn: Darrin M. Ocasio
To the Holder:
Address:
Attention:
With another copy (which shall not constitute
Notice) to:
Name:
Address:
Attention:
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.
c. Payments.
The Company will make all payments under this Note by wire transfer of immediately available funds to the bank account specified by the
Holder in written notice delivered to the Company on or before each Repayment Date.
15. CANCELLATION.
After the Principal amount, and other amounts at any time owed on this Note have been paid in full or converted in full, this Note shall
automatically be deemed canceled, shall be surrendered to the Company for cancellation and shall not be reissued.
16. WAIVER
OF JURY TRIAL. Each party hereby waives its right to a jury trial in connection with any suit, action or proceeding in connection
with any matter relating to this Note.
17. GOVERNING
LAW. This Note shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to its
principles regarding conflicts of law.
18. 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.
19. CERTAIN
DEFINITIONS. For purposes of this Note, the following terms shall have the following meanings:
“Affiliate” means any
Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a
Person, as such terms are used in and construed under Rule 405 under the Securities Act.
“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.
“Common Stock Equivalents”
means any securities of the Company or any subsidiary which would entitle the holder thereof to acquire at any time Common Stock, including,
without limitation, any debt, preferred stock, right, option, warrant, unit, or other instrument that is at any time convertible into
or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.
“Exempt Issuance” means
the issuance of (a) shares of Common Stock or options to employees, officers, directors, advisors or independent contractors of the Company;
provided. however, that such issuance is approved by a majority of the board of directors of the Company, (b) shares of Common Stock,
warrants or options to advisors or independent contractors of the Company for compensatory purposes, (c) securities upon the exercise
or exchange of or conversion of any securities issued hereunder and/or other securities exercisable or exchangeable for or convertible
into shares of Common Stock issued and outstanding on the date hereof, provided that such securities have not been amended since the date
hereof to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities,
(d) securities issuable pursuant to any contractual anti-dilution obligations of the Company in effect as of the date hereof, provided
that such obligations have not been materially amended since the date of hereof, and (e) securities issued pursuant to acquisitions or
any other strategic transactions approved by a majority of the disinterested members of the Board of Directors, provided that any such
issuance shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to
an entity whose primary business is investing in securities.
“Maturity Date” shall
mean August X, 2024.
“Person” means “person”
as such term is used for purposes of Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended, including any individual,
corporation, limited liability company, partnership, trust, unincorporated organization, government or any agency or political subdivision
thereof, or any other entity or any group of persons.
“Securities Act” means
the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. “Trading Day” means a day on
which the principal Trading Market is open for trading.
“Trading Market” means
any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE
American; the Nasdaq Capital Market; the Nasdaq Global Market; the Nasdaq Global Select Market; the New York Stock Exchange; any level
of the OTC Markets operated by OTC Markets Group, Inc. or the OTC Bulletin Board (or any successors to any of the foregoing).
“Transaction Documents”
means, collectively, this Note, the Purchase Agreement, between the Company and the Holder dated February X, 2023 and Amendment I dated
August X, 2023, and the other agreements and instruments entered into or delivered by any of the parties hereto in connection with the
transactions contemplated by the Purchase Agreement, as may be amended from time to time.
[Signature Page Follows]
[SIGNATURE PAGE TO THE CONVERTIBLE PROMISSORY NOTE]
IN WITNESS WHEREOF, the Company has caused
this Note to be duly executed as of the Issuance Date set out above.
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COMPANY: |
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Splash Beverage Group, Inc |
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(A Nevada Corporation) |
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By: |
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Name Robert Nistico |
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Title: CEO |
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HOLDER: |
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By: |
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Entity: |
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Name: |
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Title: |
EXHIBIT 1
Form of Notice of Conversion
Splash Beverage Group, Inc.
1314 East Las Olas Blvd., Suite 221
Fort Lauderdale, Florida 33316
Attn: Chief Financial Officer
The undersigned hereby elects to
convert certain outstanding amount as set forth below of the Convertible Promissory Note of Splash Beverage Group, Inc., a Nevada corporation
(the “Company”), issuance date August _____, 2023, into shares of common stock (the “Common Stock”), of the Company
according to the conditions hereof, as of the date written below. If shares of Common Stock are to be issued in the name of a person other
than the undersigned, the undersigned will pay all transfer taxes payable with respect thereto and is delivering herewith such certificates
and opinions as reasonably requested by the Company in accordance therewith. No fee will be charged to the holder for any conversion,
except for such transfer taxes, if any.
The undersigned agrees to comply
with the delivery requirements under the applicable securities laws in connection with any transfer of the aforesaid shares of Common
Stock.
Conversion calculations:
Principal Amount of Note to be
Converted: $
Conversion Price per Share: $
Number of Shares of Common Stock
to be Issued upon Conversion:
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EXHIBIT 10.4
SPLASH BEVERAGE GROUP, INC.
AMMENDMENT I
SECURITIES PURCHASE AGREEMENT
CONVERTIBLE PROMISSORY NOTE
This Amendment
I is related to SECURITIES PURCHASE AGREEMENT and Convertible Promissory Note both entered into as of February 28, 2023, by and
between Splash Beverage Group, Inc., a Nevada corporation (the “Company”), and [ ] (the “Investors”
and the “Holders”).
WHEREAS, the
Company wishes to sell and issue to the Investors, a new Convertible Promissory Note with an aggregate of up to $1,100,000 (the
“Maximum Offering Amount”) of the Company’s convertible promissory notes in the form of Exhibit A attached hereto
(each, a “Promissory Note” or “Note” and collectively the “Promissory Notes” or “Notes”)
which are convertible into the Company’s Common Stock, par value $0.001 per share (“Common Stock”). The funds
will be transferred to the company in two (2) tranches, initial funding $300,000 and second funding $800,000;
WHEREAS, in
connection with the Investor’s purchase of the Notes, for each $1,000 of Notes purchased, the Company will issue to the Investor
500 shares of restricted common stock, issuable upon the purchase of the amount of the Promissory Notes by an Investor (the “Purchase
Price”). Instructions to issue the additional shares shall be within 2 days of receiving each tranche of funds ($300,000
and $800,000);
WHEREAS, the
February 28, 2023, Convertible Promissory Note section 4.b. Prepayment; Conversion will be updated to read:
Commencing as of the date first above written,
and until the sooner of the twelve (12) month anniversary of the Closing Date, the Holder shall not sell or dispose of Common Stock
of more than 20% of the daily composite trading volume of the Common Stock as reported by Bloomberg, LP for any trading day for
the principal trading market for the Common Stock.
WHEREAS, the
February 28, 2023, Convertible Promissory Note section 17. Governing Law will be updated to read:
This Note shall be governed by and construed in accordance with
the laws of the State of Arizona, without giving effect to its principles regarding conflicts of law.
WHEREAS, the
February 28, 2023, Security Purchase Agreement section 9.9 Applicable Law; Disputes will be updated to read:
Applicable Law; Disputes.
This Agreement and the Notes shall be governed by and construed in accordance with the laws of the State of Arizona, without giving
effect to its principles regarding conflicts of law. Each party agrees that all legal proceedings concerning the interpretation,
enforcement and defense of the transactions contemplated by any of the Transaction Documents (whether brought against a party hereto
or its respective Affiliates, directors, officers, shareholders, employees or agents) shall be commenced in the state and federal
courts sitting in the City of Phoenix (the “Arizona Courts”). Each party hereto hereby irrevocably submits to the exclusive
jurisdiction of the Arizona Courts for the adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents), 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 such Arizona Courts, or such Arizona Courts are improper or inconvenient venue for such proceeding. Each party
hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding
by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the
address in effect for notices to it under this Agreement or the Notes and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process
in any other manner permitted by applicable law. Each party hereto hereby irrevocably waives, to the fullest extent permitted by
applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the
Notes or the transactions contemplated hereby. If any party shall commence an action or proceeding to enforce any provisions of
this Agreement or the Notes, then the prevailing party in such action or proceeding shall be reimbursed by the other party for
its attorney’s fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action
or proceeding.
WHEREAS, All
other conditions remain as written in the February 28, 2023 agreements.
COMPANY:
Splash Beverage Group, Inc.
(A Nevada Corporation)
By: |
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Name |
Robert Nistico |
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Title: |
CEO |
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HOLDER: |
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EXHIBIT 10.5
SPLASH BEVERAGE GROUP, INC.
SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE
AGREEMENT (this “Agreement”) is made and entered into as of _________, by and between Splash Beverage Group, Inc.,
a Nevada corporation (the “Company”), and the investors set forth on the signature pages affixed hereto (each, an “Investor”
and, collectively, the “Investors”).
WHEREAS, the Company wishes to
sell and issue to the Investors, an aggregate of up to 8.5 Million ($8,500,000) (the
“Maximum Offering Amount”) of the Company’s convertible promissory notes in the form of Exhibit A
attached hereto (each, a “Promissory Note” or “Note” and collectively the “Promissory
Notes” or “Notes”) which are convertible into the Company’s Common Stock.
WHEREAS, in
connection with Investor’s purchase of the Notes, the Company will issue to the Investor a warrant to purchase such number of shares
of Common Stock up to 50% of the shares of Common Stock issuable upon conversion (as of the date hereof) of the Note; and
WHEREAS, unless
terminated earlier by the Company, the offering (the “Offering”) and sales of the Promissory Notes shall terminate
on the sooner of the sale of the Maximum Offering Amount or July 31, 2023, but the Company
may, in its sole discretion, extend this Offering to August 31, 2023;
NOW, THEREFORE,
in consideration of the mutual terms, conditions and other agreements set forth herein and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the parties hereto hereby agree
to the sale and purchase of the Notes as set forth herein.
For purposes of
this Agreement, the terms set forth below shall have the corresponding meanings provided below.
“Affiliate” shall
mean, with respect to any specified Person (as defined below), (i) if such Person is an individual, the spouse, heirs, executors, or legal
representatives of such individual, or any trusts for the benefit of such individual or such individual’s spouse and/or lineal descendants,
or
(ii) otherwise, another Person that
directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, the Person specified.
As used in this definition, “control” shall mean the possession, directly or indirectly, of the sole and unilateral power
to cause the direction of the management and policies of a Person, whether through the ownership of voting securities or by contract or
other written instrument.
“Business Day” shall mean
any day on which banks located in New York City are not required or authorized by law to remain closed.
“Closing” and “Closing Date”
as defined in Section 2.3(a) hereof.
“Common Stock” as defined in the recitals above.
“Company’s Knowledge”
means the actual knowledge of any executive officer (as defined in Rule 405 under the Securities Act) or director of the Company, or the
knowledge of any fact or matter which any person would reasonably be expected to become aware of in the course of performing the duties
and responsibilities as an executive officer or director of the Company.
“Conversion Shares”
means the shares of Common Stock issuable upon conversion of the Promissory Notes.
“Liens” means any
mortgage, lien, title claim, assignment, encumbrance, security interest, adverse claim, contract of sale, restriction on use or transfer
or other defect of title of any kind.
“Material Adverse Effect”
means a material adverse effect on (i) the assets, liabilities, results of operations, condition (financial or otherwise), business, or
prospects of the Company and its Subsidiaries taken as a whole, (ii) the transactions contemplated hereby or in any of the Transaction
Documents or (iii) the ability of the Company to perform its obligations under the Transaction Documents (as defined below).
“Person” shall mean an individual, entity,
corporation, partnership, association, limited liability company, limited liability partnership, joint-stock company, trust or unincorporated
organization.
“Purchase Price” shall mean the amount of the
Promissory Notes being purchased by an Investor.
“Regulation D” as defined in Section 3.7 hereof.
“Securities Act” means the Securities Act of
1933, as amended.
“Subsidiaries” and “Subsidiary”
shall have the meaning as defined in Section 4.1(a).
“Transaction Documents” shall mean this Agreement,
the Promissory Notes and the Investor Warrant.
“Transaction Securities” shall mean the Promissory
Notes, Conversion Shares, the Investor Warrant and the Warrant Shares.
“Transfer” shall
mean any sale, transfer, assignment, conveyance, charge, pledge, mortgage, encumbrance, hypothecation, security interest or other disposition,
or to make or effect any of the above.
“Warrant
Shares” the shares of Common Stock issuable upon exercise of the Investor Warrant.
| 2. | Sale and Purchase of Promissory Notes. |
2.1 Subscription
for Promissory Notes by Investors. Subject to the terms and conditions of this Agreement, on each of the respective Closing Dates
(as hereinafter defined) each of the Investors shall severally, and not jointly, purchase, and the Company shall sell and issue to the
Investors, the Promissory Notes, in the respective amounts set forth on the signature pages attached hereto in exchange for the Purchase
Price. Subject to the terms and conditions of the Promissory Note, such Note shall have a term of Eighteen (18) months, bear an interest
rate of 12% per annum and can be converted into Conversion Shares at a fixed conversion price of $1.00 share, subject to adjustment
as set forth in the Promissory Notes. In connection with Investor’s purchase of the Notes, the Company will issue to the Investor
a warrant (the “Investor Warrant”) to purchase such number of shares of Common Stock equal to 50% of the shares of Common
Stock issuable upon conversion as of the date hereof of the Note. For example if the Investor purchase a Note in the principal amount
of $________ the Investor will be issued an Investor Warrant to purchase up to __________ shares of Common Stock. A form of the Investor
Warrant is attached hereto as Exhibit B. The exercise price of the Investor Warrant shall be $0.25 subject to adjustment as provided in
the Investor Warrant and shall be valid for 5 years from the date of this agreement.
The Offering shall terminate on the sooner of i) the sale of the
Maximum Offering Amount,
ii) the termination by the Company at its sole discretion, or
iii) August 31, 2023.
2.2 Conversion
and Exercise Limitation.
Conversion is
limited to the terms and conditions set forth in section 2.1 and limited to the terms and conditions within the Convertible Promissory
Note in Exhibit A. Holder may exercise at Its discretion at any time during the 18-month period of the note.
(a) Closing.
Subject to the terms and conditions set forth in this Agreement, the Company shall issue and sell to each Investor, and each Investor
shall, severally and not jointly, purchase from the Company on each of the respective Closing Dates, a Promissory Note in the amount set
forth on the signature pages attached
hereto, which will be reflected opposite such Investor’s name on Annex A (the “Closing”). The date of
the Closing for each Investor is hereinafter referred to as the “Closing Date.”
(b) Rolling
Closing. One or more closings shall occur on the date and time agreed to with each Investor purchasing a Note and shall occur remotely
via the exchange of documents and signatures and wire transfers. Each Closing shall occur on the second Business Day following the date
of this Agreement as first above written.
2.4. Closing
Deliveries. At the Closing, the Company shall deliver to an Investor, against delivery by the Investor of the Purchase Price (as provided
below) a Promissory Note in the principal amount equivalent to the Purchase Price.
At the Closing,
each Investor shall deliver or cause to be delivered to the Company a copy of this Agreement duly signed by such Investor, a completed
accredited investor questionnaire (the “Accredited Investor Questionnaire”), substantially in the form attached herein
as Exhibit C, and the Purchase Price set forth in its counterpart signature page annexed hereto by paying United States dollars
in immediately available funds, to be sent to the Company pursuant to the wiring instruction attached herein as Exhibit D.
| 3. | Representations, Warranties and Acknowledgments of the Investors. |
Each Investor, severally and not jointly,
represents and warrants to the Company solely as to such Investor that:
3.1 Authorization.
The execution, delivery and performance by such Investor of the Transaction Documents to which such Investor is a party have been duly
authorized and will each constitute the valid and legally binding obligation of such Investor, enforceable against such Investor in accordance
with their respective terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general
applicability, relating to or affecting creditors’ rights generally.
3.2 Purchase
Entirely for Own Account. The Transaction Securities to be received by such Investor hereunder will be acquired for such Investor’s
own account, not as nominee or agent, and not with a view to the resale or distribution of any part thereof in violation of the Securities
Act, and such Investor has no present intention of selling, granting any participation in, or otherwise distributing the same in violation
of the Securities Act, without prejudice, however, to such Investor’s right at all times to sell or otherwise dispose of all or
any part of such Transaction Securities in compliance with applicable federal and state securities laws. Nothing contained herein
shall be deemed a representation or warranty by such Investor to hold the Transaction Securities for any period of time. Such Investor
is not a broker-dealer registered with the SEC under the Exchange Act or an entity engaged in a business that would require it to be so
registered.
3.3. Investment
Experience. Such Investor acknowledges that the purchase of the Transaction Securities is a highly
speculative investment and that it can bear the economic risk and complete loss of its investment in the Transaction Securities
and has such knowledge and experience in financial or business matters such that it is capable of evaluating the merits and risks of the
investment contemplated hereby.
3.4 Disclosure
of Information. Such Investor has had an opportunity to receive all information related to the Company and the Transaction Securities
requested by it and to ask questions of
and receive answers from the Company
regarding the Company, its business and the terms and conditions of the offering of the Transaction Securities. Neither such inquiries
nor any other due diligence investigation conducted by such Investor shall modify, amend or affect such Investor’s right to rely
on the Company’s representations and warranties contained in this Agreement.
3.5 Restricted
Securities. Such Investor understands that the Transaction Securities are characterized as “restricted securities” under
the U.S. federal securities laws since they are being acquired from the Company in a transaction not involving a public offering and that
under such laws and applicable regulations such securities may be resold without registration under the Securities Act only in certain
limited circumstances.
3.6 Legends.
The Investor understands that, except as provided below, certificates evidencing the Conversion Shares will bear the following or any
similar legend:
| (a) | “The securities represented hereby may not be transferred unless |
(i) such securities have been registered
for sale pursuant to the Securities Act of 1933, as amended, (ii) such securities may be sold pursuant to an available exemption from,
or in a transaction not subject to, the registration requirements of the Securities Act, or (iii) the Company has received an opinion
of counsel reasonably satisfactory to it that such transfer may lawfully be made without registration under the Securities Act of 1933
or qualification under applicable state securities laws.”
(b) If
required by the authorities of any state in connection with the issuance of sale of the Transaction Securities, the legend required by
such state authority.
3.7 Accredited
Investor. Each Investor is an accredited investor as defined in Rule 501(a) of Regulation D, as amended, under the Securities Act
(“Regulation D”) and the information provided in the Accredited Investor Questionnaire is accurate and complete as
of the Closing Date.
3.8 No
General Solicitation. Such Investor did not learn of the investment in the Transaction Securities as a result of any public advertising
or general solicitation.
3.9 Brokers
and Finders. Except the Broker, the Investor is not aware of any involvement of any other broker and finder for this Transaction.
No Investor will have, as a result of the transactions contemplated by the Transaction Documents, any valid right, interest or claim against
or upon the Company, any Subsidiary or any other Investor, for any commission, fee or other compensation pursuant to any agreement, arrangement
or understanding entered into by or on behalf of such Investor.
| 4. | Representations and Warranties of the Company. |
The Company represents, warrants and covenants to the Investors
that:
| 4.1. | Organization; Execution, Delivery and Performance. |
(a) The
Company and each of its Subsidiaries, if any, is a corporation or other entity duly organized, validly existing and in good standing under
the laws of the jurisdiction in which it is incorporated or organized, with full power and authority (corporate and other) to own, lease,
use and operate its properties and to carry on its business as and where now owned, leased, used, operated and conducted. The Company
is duly qualified as a foreign corporation to do business and is in good standing in every jurisdiction in which its ownership or use
of property or the nature of the business conducted by it makes such qualification necessary except where the failure to be so qualified
or in good standing would not have a Material Adverse Effect. As of the date of this Agreement, the Company owned and operated Subsidiaries.
(b) (i)
The Company has all requisite corporate power and authority to enter into and perform the Transaction Documents and to consummate the
transactions contemplated hereby and thereby and to issue the Transaction Securities, in accordance with the terms hereof and thereof,
(ii) the execution and delivery of the Transaction Documents by the Company and the consummation by the Company of the transactions contemplated
hereby and thereby (including without limitation, the issuance of the Transaction Securities) have been duly authorized by the Company’s
Board of Directors and no further consent or authorization of the Company, its Board of Directors, or its stockholders, is required, (iii)
each of the Transaction Documents has been duly executed and delivered by the Company by its authorized representative, and such authorized
representative is a true and official representative with authority to sign each such document and the other documents or certificates
executed in connection herewith and bind the Company accordingly, and (iv) each of the Transaction Documents constitutes, and upon execution
and delivery thereof by the Company will constitute, a legal, valid and binding obligation of the Company enforceable against the Company
in accordance with its terms, except to the extent limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws
of general application affecting enforcement of creditors’ rights and general principles of equity that restrict the availability
of equitable or legal remedies.
4.2. Securities
Duly Authorized. The Transaction Securities to be issued to each Investor pursuant to this Agreement, when issued and delivered in
accordance with the terms of this Agreement, will be duly authorized and validly issued and will be fully paid and nonassessable and free
from all taxes or Liens with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights of stockholders
of the Company. Subject to the accuracy of the representations and warranties of the Investors party to this Agreement, the offer and
issuance by the Company of the Transaction Securities is exempt from registration under the Securities Act.
4.3 No Conflicts.
The execution, delivery and performance of the Transaction Documents by the Company and the consummation by the Company of the transactions
contemplated hereby and thereby (including without limitation, the issuance of the Transaction Securities) will not: (i) conflict with
or result in a violation of any provision of the Company’s Articles of Incorporation or By- laws, each as amended to date or (ii)
violate or conflict with, or result in a breach of any provision of, or constitute a default (or an event which with notice or lapse of
time or both could become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any
agreement, indenture, patent, patent license or instrument, to which the Company or any of its Subsidiaries is a party or by which any
property or asset of the Company or any of its Subsidiaries is bound or affected or (iii) result in a violation of any law, rule, regulation,
order, judgment or decree (including federal and state securities laws and regulations and regulations of any self-regulatory organizations
to which the Company or its securities are subject) applicable to the Company or any of its Subsidiaries or by which any property or asset
of the Company or any of its Subsidiaries is bound or affected. Neither the Company nor any of its Subsidiaries is in violation of its
Articles of Incorporation, By-laws or other organizational documents, each as amended to date. Neither the Company nor any of its Subsidiaries
is in default (and no event has occurred which with notice or lapse of time or both could put the Company or any of its Subsidiaries in
default) under, and neither the Company nor any of its Subsidiaries has taken any action or failed to take any action that would give
to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Company
or any of its Subsidiaries is a party or by which any property or assets of the Company or any of its Subsidiaries is bound or affected,
or for possible defaults as would not, individually or in the aggregate, have a Material
Adverse Effect. Except as required under the Securities Act, the Exchange Act and any applicable state securities laws, the Company is
not required to obtain any consent, authorization or order of, or make any filing or registration with, any court, governmental agency,
regulatory agency, self-regulatory organization or stock market or any third party in order for it to execute, deliver or perform any
of its obligations under this Agreement or to issue and sell the Transaction Securities in accordance with the terms hereof.
4.4. Capitalization.
As of April 30, 2023, the authorized capital stock of the Company consisted of 300,000,000
shares of Common Stock, par value $0.001 per share, par value $0.001 per share.
4.5 Permits; Compliance.
The Company and each of its Subsidiaries is in possession of all franchises, grants, authorizations, licenses, permits, easements, variances,
exemptions, consents, certificates, approvals and orders necessary to own, lease and operate its properties and to carry on its business
as it is now being conducted (collectively, the “Company Permits”), and there is no action pending or, to the knowledge
of the Company, threatened regarding suspension or cancellation of any of the Company Permits. Neither the Company nor any of its Subsidiaries
is in conflict with, or in default or violation of, any of the Company Permits, except for any such conflicts, defaults or violations
which, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect.
4.7 Litigation.
Except as set forth in Schedule 4.7 , to the Company’s knowledge there is no action, suit, claim, proceeding, inquiry or investigation
pending before or by any court, public board, government agency, self-regulatory organization or body or, to the Company’s knowledge,
threatened against or affecting the Company or any of its Subsidiaries, or their respective businesses, properties or assets or their
officers or directors in their capacity as such, that may reasonably be expected to have a Material Adverse Effect.
4.8 No
General Solicitation. Neither the Company nor any person participating on the Company’s behalf in the transactions contemplated
hereby has conducted any “general solicitation,” as such term is defined in Regulation D promulgated under the Securities
Act, with respect to any of the Transaction Securities being offered hereby.
4.9 No
Integrated Offering. Neither the Company, nor any of its Affiliates, nor any person acting on its or their behalf, has directly or
indirectly made any offers or sales in any security or solicited any offers to buy any security under circumstances that would require
registration under the Securities Act of the issuance of the Transaction Securities to the Investors. The issuance of the Transaction
Securities to the Investors will not be integrated with any other issuance of the Company’s securities (past, current or future)
for purposes of any stockholder approval provisions applicable to the Company or the Securities Act.
4.10 Intellectual
Property. The Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks, trademark applications,
service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights and similar rights
necessary or required for use in connection with their respective businesses and which the failure to so have could have a Material Adverse
Effect (collectively, the “Intellectual Property Rights”). None of, and neither the Company nor any Subsidiary has received
a notice (written or otherwise) that any of, the Intellectual Property Rights has expired, terminated or been abandoned, or is expected
to expire or terminate or be abandoned, within two (2) years from the date of this Agreement. Neither the Company nor any Subsidiary
has received, a written notice of a claim or otherwise has any knowledge that the Intellectual Property
Rights
violate or infringe upon the rights of any Person, except as could not reasonably be expected to not have a Material Adverse Effect.
To the knowledge of the Company, all such Intellectual Property Rights are enforceable and there is no existing infringement by another
Person of any of the Intellectual Property Rights. The Company and its Subsidiaries have taken reasonable security measures to protect
the secrecy, confidentiality and value of all of their intellectual properties, except where failure to do so could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
4.11 Financial
Statements. Copies of financial statements consisting of the balance sheet of the Company in each of the years ended December 31,
2022 and 2021 and the related statements of income and retained earnings and stockholders’ equity for the years then ended (the
“Financial Statements”) have been made available to Investor. The Financial Statements have been prepared in accordance with
accounting principles that the Company believes are reasonable for a company of its size and financial condition. The Company represents
that the Financial Statements fairly present in all material respects the financial condition of the Company as of the respective dates
they were prepared and the results of the operations of the Company for the periods indicated.
4.12 Tax
Status. Except for matters that would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse
Effect, the Company and its Subsidiaries each (i) has made or filed all United States federal, state and local income and all foreign
income and franchise tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has paid all taxes
and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and
declarations and (iii) has set aside on its books provision reasonably adequate for the payment of all material taxes for periods subsequent
to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material amount claimed to be due
by the taxing authority of any jurisdiction, and the officers of the Company or of any Subsidiary know of no basis for any such claim.
4.13 Material
Adverse Effect. Except as expressly contemplated by this Agreement, from December 31, 2021 (the “Balance Sheet Date”)
until the date of this Agreement, the Company has operated its business in the ordinary course in all material respects and there has
not been, with respect to the business, and other than in the ordinary course of business, any:
| (a) | event, occurrence or development that has had a Material Adverse Effect; |
(b) incurrence
of any indebtedness for borrowed money in connection with the business in an aggregate amount exceeding $50,000, except unsecured current
obligations and liabilities incurred in the ordinary course of business;
(c) increase
in the compensation of any employees, other than as provided for in any written agreements or in the ordinary course of business;
| (d) | adoption, termination, amendment or modification of any employee benefit plan; |
(e) adoption
of any plan of merger, consolidation, reorganization, liquidation or dissolution or filing of a petition in bankruptcy under any provisions
of federal or state bankruptcy law or consent to the filing of any bankruptcy petition against it under any similar law; or
(f) any
agreement to do any of the foregoing, or any action or omission that would result in any of the foregoing.
“Material
Adverse Effect” shall mean any event, occurrence, fact, condition or change that is materially adverse to (a) the business, results
of operations, financial condition or assets of the Company, taken as a whole, or (b) the ability of the Company to consummate the transactions
contemplated hereby;
provided, however, that “Material
Adverse Effect” shall not include any event, occurrence, fact, condition or change, directly
or indirectly, arising out of or attributable to: (i) general economic or political conditions;
(ii) conditions
generally affecting the industries in which the Company operates; (iii) any changes in financial, banking or securities markets in general,
including any disruption thereof and any decline in the price of any security or any market index or any change in prevailing interest
rates; (iv) acts of war (whether or not declared), armed hostilities or terrorism, or the escalation or worsening thereof; (v) any action
required or permitted by this Agreement or any action taken (or omitted to be taken) with the written consent of or at the written request
of the Investor; (vi) any matter of which the Investor is aware on the date hereof;
(vii) any changes
in applicable laws or accounting rules (including GAAP); (viii) any natural or man-made disaster or acts of God; or (ix) any failure by
the Company to meet any internal or published projections, forecasts or revenue or earnings predictions.
5.1. Transfer
or Resale. Each Investor understands that the sale or resale of all or any portion of the Transaction Securities have not been and
is not being registered under the Securities Act or any applicable state securities laws, and all or any portion of the Transaction Securities
may not be transferred unless the Investor shall have delivered to the Company, at its own cost, a customary opinion of counsel that shall
be in form, substance and scope reasonably acceptable to the Company, to the effect that the Transaction Securities to be sold or transferred
may be sold or transferred pursuant to an exemption from such registration.
6.2 Shareholder
Registry. If an Investor provides the Company with a customary opinion of counsel, that shall be in form, substance and scope reasonably
acceptable to the Company, to the effect that a Transfer of such Transaction Securities may be made without registration under the Securities
Act and such sale or transfer is effected, the Company shall permit the Transfer and promptly record the Transfer on its shareholder registry
or, if the Company has a transfer agent, instruct its transfer agent to enter the Transfer in book-entry or issue one or more certificates
in such name and in such denominations as specified by such Investor.
| 6. | Conditions to Closing of the Investors. |
The obligation
of each Investor hereunder to purchase the Notes at the Closing is subject to the satisfaction, at or before the respective Closing Dates,
of each of the following conditions, provided that these conditions are for each Investor’s sole benefit and may be waived by such
Investor at any time in its sole discretion by providing the Company with prior written notice thereof:
6.1. Representations,
Warranties and Covenants. The representations and warranties of the Company shall be true and correct in all material respects as
of the date when made and as of the Closing Date as though originally made at that time (except for representations and warranties that
speak as of a specific date, which shall be true and correct in all material respects as of such date) and the Company shall have performed,
satisfied and complied in all material respects with the covenants, agreements and conditions required to be performed, satisfied or complied
with by the Company at or prior to the Closing Date.
6.2. Consents.
The Company shall have obtained all governmental, regulatory or third party consents and approvals, if any, necessary for the sale of
the Promissory Notes and Transaction
Securities. In addition, the Company shall
have delivered the consent of its Board of Directors for the Transactions and issuances of the Promissory Notes and Transaction Securities.
6.3. Delivery
by Company. The Company shall have duly executed and delivered to such Investor (A) each of the other Transaction Documents such Investor
is party to and (B) copies by mail, fax or e-mail of the Notes being purchased by such Investor(s) pursuant to this Agreement as is set
forth on the signature page.
6.4.
No Material Adverse Effect. Since the date of first execution of this Agreement, no event or series
of events shall have occurred that reasonably would have or result in a Material Adverse Effect.
6.5. No
Prohibition. No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated
or endorsed by any court or governmental authority of competent jurisdiction that prohibits the consummation of any of the transactions
contemplated by the Transaction Documents.
6.6. Other
Documents. The Company shall have delivered to such Investor such other documents, instruments or certificates relating to the transactions
contemplated by this Agreement as such Investor or its counsel may reasonably request.
| 7. | Conditions to Closing of the Company. |
The obligations of the Company to
effect the transactions contemplated by this Agreement with each Investor are subject to the fulfillment at or prior to the Closing Date
of the conditions listed below.
7.1. Representations
and Warranties. The representations and warranties made by such Investor in Section 3 shall be true and correct in all material respects
at the time of such Closing as if made on and as of such date.
7.2. Corporate
Proceedings. All corporate and other proceedings required to be undertaken by such Investor in connection with the transactions contemplated
hereby shall have occurred and all documents and instruments incident to such proceedings shall be reasonably satisfactory in substance
and form to the Company.
7.3. Investor
Deliveries. The Company will have received the deliveries of the Investors set forth in Section 2.4.
8.1. Notices.
All notices, requests, demands and other communications provided in connection with this Agreement shall be in writing and shall be deemed
to have been duly given at the time when hand delivered, delivered by express courier, or sent by facsimile (with receipt confirmed by
the sender’s transmitting device) in accordance with the contact information provided below or such other contact information as
the parties may have duly provided by notice.
The Company:
Splash Beverage Group, Inc.
1314 E. Las Olas Blvd, Suite 221
Fort Lauderdale, Florida 33301
Attention: Ron Wall, CFO
Email: ronw@splashbeveragegroup.com
|
With a copy to:
Sichenzia Ross Ference LLP
1185 Avenue of the Americans, 31st Floor New
York, New York 10036
Telephone: 212-930-9700
Facsimile: 212-930-9275 Attention: Darrin Ocasio,
Esq. Email: dmocasio@srf.law |
The Investor:
As per the contact information provided on the signature pages
hereof.
8.2. Expenses.
All costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party
incurring such costs and expenses.
8.4. Entire
Agreement. This Agreement contains the entire agreement between the parties hereto in respect of the subject matter contained herein
and supersedes all prior agreements and understandings of the parties, oral and written, with respect to the subject matter contained
herein.
8.5. Underlying
Shares. The Company agrees at all times as long as the Promissory Notes may be converted
or exercised, to keep reserved from the authorized and unissued Common Stock, such number of shares of Common Stock as may be issuable
upon conversion of the Promissory Notes.
8.6. Third
Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and
assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other person.
8.7. Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns. Neither
the Company nor any Investor shall assign this Agreement or any rights or obligations hereunder without the prior written consent of the
other. Notwithstanding the foregoing, but subject to the provisions of Section 6.1 hereof, any Investor may, without the consent of the
Company or any other Investor, assign its rights hereunder to any person that purchases Transaction Securities in a private transaction
from an Investor or to any of its Affiliates.
9.8 Binding Effect;
Benefits. This Agreement and all the provisions hereof shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns; nothing in this Agreement, expressed or implied, is intended to confer on any persons other
than the parties hereto or their respective successors and permitted assigns, any rights, remedies, obligations or liabilities under or
by reason of this Agreement.
9.10. Amendment;
Waivers. All modifications, amendments or waivers to this Agreement shall require the written consent of both the Company and the
holders of the Promissory Notes.
9.12. Applicable
Law; Disputes. This Agreement and the Notes shall be governed by and construed in accordance with the laws of the State of New York,
without giving effect to its principles regarding conflicts of law. Each party agrees that all legal proceedings concerning the interpretation,
enforcement and defense of the transactions contemplated by any of the Transaction Documents (whether brought against a party hereto or
its respective Affiliates, directors, officers, shareholders, employees or agents) shall be commenced in the state and federal courts
sitting in the City of New York, Borough of Manhattan (the “New York Courts”). Each party hereto hereby irrevocably
submits to the exclusive jurisdiction of the New York Courts for the adjudication of any dispute hereunder or in connection herewith or
with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents),
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 such New York Courts, or such New York Courts are improper or inconvenient venue for such proceeding. Each party
hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing
a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect
for notices to it under this Agreement or the Notes and agrees that such service shall constitute good and sufficient service of process
and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted
by applicable law. Each party hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to
trial by jury in any legal proceeding arising out of or relating to this Agreement or the Notes or the transactions contemplated hereby.
If any party shall commence an action or proceeding to enforce any provisions of this Agreement or the Notes, then the prevailing party
in such action or proceeding shall be reimbursed by the other party for its attorney’s fees and other costs and expenses incurred
in the investigation, preparation and prosecution of such action or proceeding.
9.13. Further
Assurances. Each party hereto shall do and perform or cause to be done and performed all such further acts and shall execute and deliver
all such other agreements, certificates, instruments and documents as any other party hereto reasonably may request in order to carry
out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.
9.14. Counterparts.
This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which taken together
shall constitute one and the same instrument. This Agreement may also be executed via facsimile or email, which shall be deemed an original.
9.15. Independent
Nature of Investors. The obligations of each Investor under this Agreement or other transaction document are several and not
joint with the obligations of any other Investor, and no Investor shall be responsible in any way for the performance of the
obligations of any other Investor under this Agreement or any other transaction document. Each Investor shall be responsible only
for its own representations, warranties, agreements and covenants hereunder. The decision of each Investor to purchase the
Transaction Securities pursuant to this Agreement has been made by such Investor independently of any other Investor and
independently of any information, materials, statements or opinions as to the business, affairs, operations, assets, properties,
liabilities, results of operations, condition (financial or otherwise) or prospects of the Company which may have been made or given
by any other Investor or by any agent or employee of any other Investor, and no Investor or any of its agents or employees shall
have any liability to any other Investor (or any other person) relating to or arising from any such information, materials,
statements or opinions. Nothing contained herein or in any other transaction document, and no action taken by any Investor pursuant
hereto or thereto, shall be deemed to constitute the Investors as a partnership, an association, a joint venture or any other kind
of entity, or create a presumption that the Investors are in any way acting in concert or as a group with respect to such
obligations or the transactions contemplated by this Agreement. Except as otherwise provided in this Agreement or any other
transaction document, each Investor shall be entitled to independently protect and enforce its rights arising out of this Agreement
or out of the other transaction documents, and it shall not be necessary for any other Investor
to be joined as an additional party in any proceeding for such purpose. Each Investor has been represented by its own separate legal
counsel in connection with the transactions contemplated hereby.
[SIGNATURE PAGES IMMEDIATELY
FOLLOW]
IN WITNESS WHEREOF, the undersigned
Investors and the Company have caused this Securities Purchase Agreement to be duly executed as of the date first above written.
SPLASH BEVERAGE GROUP INC.
By: ___________________________________
Name: Robert Nistico
Title: CEO
INVESTORS:
The Investors executing the Signature
Page in the form attached hereto as Annex A and delivering the same to the Company or its agents shall be deemed to have executed
this Agreement and agreed to the terms hereof.
Annex A
Securities Purchase Agreement
Investor Counterpart Signature Page
The undersigned, desiring to: (i)
enter into this Securities Purchase Agreement dated as of May 10, 2023 (the “Agreement”), with the undersigned, SPLASH
BEVERAGE GROUP, INC., a Nevada corporation (the “Company”), in or substantially in the form furnished to the undersigned
and (ii) purchase the Convertible Promissory Notes as set forth below, hereby agrees to purchase such Notes from the Company as of the
Closing and further agrees to join the Agreement as a party thereto, with all the rights and privileges appertaining thereto, and to be
bound in all respects by the terms and conditions thereof. The undersigned specifically acknowledges having read the representations in
the Agreement section entitled “Representations, Warranties and Acknowledgments of the Investors,” and hereby represents that
the statements contained therein are complete and accurate with respect to the undersigned as an Investor.
The Subscription Amount:
$400,000 Name
of Investor:
If
an entity:
Name:
_______________
Title:
Address:
Email:
Phone
Number:
If
an individual:
Print
Name: Name
Signature:
_______________
Title:
Owner
Address:
Email:
Phone
Number:
If
joint individual:
Name:
_____________
Signature:
_____________
EXHIBIT A
FORM OF CONVERTIBLE PROMISSORY
NOTE
Sent
under separate cover
EXHIBIT
B
FORM OF INVESTOR
WARRANT
Sent under separate
cover
EXHIBIT C
ACCREDITED INVESTOR QUESTIONNAIRE
Sent
under separate cover
EXHIBIT D
WIRING INSTRUCTION
Sent
under separate cover
17
EXHIBIT 10.6
Splash Beverage Group, Inc.
12% convertible
12 Month Promissory Note
Principal Amount: $________ U.S. Dollars Issuance Date: |
Original
Principal Amount: U.S. $[ ] ________ |
FOR VALUE RECEIVED, Splash
Beverage Group, Inc., a Nevada corporation (the “Company”) hereby promises to pay to the order of Name (“Holder”)
the amount set out above as the Principal Amount (the “Principal”) when due, whether upon the respective Repayment
Dates (as defined below) or earlier in accordance with the terms hereof, and to pay interest (“Interest”) on any outstanding
Principal at the applicable Interest Rate (as defined below) from the date set out above as the Issuance Date (the “Issuance Date”)
until this convertible promissory note has been paid in full. This convertible promissory note, including all promissory notes issued
in exchange, transfer or replacement hereof, is referred to as this “Note”.
1. PAYMENTS OF PRINCIPAL. Subject
to the conversion of the Note as described in Section 5, the Principal Amount and accrued Interest outstanding hereunder shall be payable
to the Holder on in full on the Maturity Date. If the first day of a month is not a Business Day, the Company shall make the payment for
the corresponding Principal Amount and Interest on the following day that is a Business Day.
2. INTEREST; INTEREST RATE. Interest
shall accrue on the unpaid principal balance of this Note at the rate of twelve (12%) per annum (the “Interest Rate”).
Interest shall be calculated from and include the Issuance Date and shall be calculated on an actual/365-day basis.
3. DEFAULT.
(a) Event of Default. Each of the
following events shall constitute an “Event of Default”:
(i) the Company’s
failure to pay to the Holder any amount of Principal, Interest, or other amounts when and as due under this Note, in which case only if
such failure remains uncured for a period of at least ten (10) days from the date when a written notice from the Holder regarding the
failure to pay Interest and/or Principal is given by the Holder of the Note, provided however, after Holder has delivered three notices
of failure to pay, any subsequent failure to pay shall constitute an immediate Event of Default with or without notice;
(ii) bankruptcy, insolvency,
reorganization or liquidation proceedings or other proceedings for the relief of debtors shall be instituted by or against the by a third
party, shall not be dismissed within thirty (30) days of their initiation;
(iii) the commencement
by the Company 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 as 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 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 of any substantial part of
their properties, 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 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;
or
(iv) the entry by
a court of (i) a decree, order, judgment or other similar document in respect of the Company 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 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 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 of any substantial part of their 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.
(b) Notice of an Event of Default.
As soon as possible and in any event within seven (7) days after the Company becomes aware that an Event of Default as set forth in Section
3(a)(ii)-(iv) has occurred and has not been cured, the Company shall notify the Holder in writing of the nature, extent and time of and
the facts surrounding such Event of Default, and the action, if any, that the Company proposes to take with respect to such Event of Default.
(c) Default
Interest Rate. Upon the occurrence of an Event of Default, the unpaid portion of the Principal
Amount will bear simple interest from the date of the Event of Default at a rate equal to seven percent (7.00%) per annum, for the duration
from such Event of Default till the cure of such Default or the repayment date of the entire outstanding balance of this Note.
4. NONCIRCUMVENTION. The Company
hereby covenants and agrees that the Company will not by amendment of its Articles of Incorporation (as amended), 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.
5. PREPAYMENT; CONVERSION.
(a) Voluntary
Prepayment. The Company may prepay the outstanding Principal and accrued but unpaid Interest of this Note at any time, in whole or
in part, without penalty or prepayment.
(b) Conversion.
At any time during the Conversion Period as defined below, the Holder may convert the unpaid and
outstanding Principal plus any accrued and unpaid Interest into shares of the Company’s common stock (the “Common Stock”)
at a conversion price (the “Conversion Price”) of $1.00 per
share, subject to certain adjustments as set forth in Section 5(d). The Conversion Period
shall commence on the Issuance Date and end on the Maturity Date of this Note.
In
any trading day, the Holder will not sell more than the total of 10% of the daily trading volume on NYSE American of the shares issuable
upon conversion of this Note and the shares issuable upon exercise of the Warrant issued in connection with this Note.
Notwithstanding
anything herein to the contrary herein, on the Maturity Date the principal and interest and any amounts due on this Note shall automatically
convert unless at least one Business Date prior to such date, the Holder and/or the Company have indicated in writing that the Note shall
not automatically Convert (the “Automatic Conversion”).
(c) Mechanics
of Conversion.
(i). Conversion
Shares Issuable Upon Conversion. The number of shares issuable upon a conversion (the “Conversion Shares”) pursuant
to Section 5(b) hereunder shall be determined by the quotient obtained by dividing the outstanding principal amount of this Note and accrued
but unpaid interest thereon to be converted by (y) the Conversion Price.
(ii.) Delivery
of Conversion Shares Upon Conversion. Not later than seven (7) Business Days (the “Share Delivery Date”) after
receiving a conversion notice substantially in a form attached herein as Exhibit 1, the Company shall deliver, or cause to be delivered,
to the Holder a certificate or certificates representing the Conversion Shares or a share report of the Holder reflecting the issuance
of Conversion Shares being acquired upon the conversion of this Note, in whole or in part.
(iii.)
Fractional Shares. No fractional shares or scrip representing fractional shares shall be issued upon the conversion of this Note.
As to any fraction of a share which the Holder would otherwise be entitled to receive upon such conversion, the Company shall at its election,
either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Conversion Price
or round up to the next whole share.
(d) Certain
Adjustments.
(i.)
Stock Splits. If the Company, at any time while this Note is outstanding: (i) subdivides outstanding shares of Common Stock into
a larger number of shares, (ii) combines (including by way of a reverse stock split) outstanding shares of Common Stock into a smaller
number of shares or (iii) issues, in the event of a reclassification of shares of the Common Stock, any shares of capital stock of the
Company, then the Conversion Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock
(excluding any treasury shares of the Company) outstanding immediately before such event, and of which the denominator shall be the number
of shares of Common Stock outstanding immediately after such event. Any adjustment made pursuant to this Section 5(d) shall become effective
immediately after the record date for the determination of stockholders entitled to receive such distribution and shall become effective
immediately after the effective date in the case of a subdivision, combination or re-classification.
(ii.) Notice of Adjustment to Conversion Price. Whenever the Conversion Price is adjusted pursuant to this Section 5(d), the Company
shall promptly deliver to each Holder a notice setting forth the new Conversion Price with three (3) Business Days after such adjustment
and setting forth a brief statement of the facts requiring such adjustment. Failure to provide such notice shall not constitute an Event
of Default.
6. COVENANTS. Until so long as no
Principal or accrued but unpaid Interest remains outstanding:
(a) Preservation of Existence. The
Company shall maintain and preserve its existence, rights and privileges, and become or remain duly qualified and in good standing in
each jurisdiction in which the character of the properties owned or leased by the Company or in which the transaction of its business
makes such qualification necessary.
(b) Public
Filings. The Company shall use its best efforts to maintain its periodic filings required by the Securities Exchange Act of 1934,
as amended (the “Exchange Act”) and keep its Common Stock quoted or tradable on the OTC Markets or another United States
stock exchange or market.
7. BENEFICIAL OWNERSHIP. In the event
that the Holder’s Beneficial Ownership (as defined below) of the Company’s Common Stock reaches 5.00% or more, as a result
of the Conversion or others, the Holder has agreed to coordinate with the Company to file certain disclosure documents as required by
Section 13(d) of the 1934 Securities Exchange Act, as amended. For purposes of this Section 7, the Holder’s Beneficial Ownership
shall mean the number of shares of Common Stock beneficially owned by the Holder and its Affiliates, as defined and calculated in accordance
with Section 13(d) of the 1934 Securities Exchange Act and the rules and regulations promulgated thereunder.
8. AMENDMENTS. No modification, amendment
or waiver of any provision of this Note shall be effective unless in writing and approved by the Company and the Holder.
9. RESTRICTIONS ON TRANSFER. This
Note may not be offered, sold, assigned or transferred by the Holder without the explicit written consent of the Company, which may be
granted or withheld at the sole discretion of the Company.
10. REISSUANCE OF THIS NOTE.
(a) Transfer. If this Note is to
be transferred with the Company’s approval as provided in Section 9, 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 10(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 10(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, by reason of prepayment or conversion
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 10(d)) representing the outstanding Principal.
(c) Reserved.
(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 10(a), 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 Issuance
Date of this Note, (iv) shall have the same rights and conditions as this Note, and (v) shall represent accrued and unpaid Interest, from
the Issuance Date.
11. 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.
12. LEGEND. The Holder understands
and agrees that the Conversion Shares upon issuance shall be restrictive and, if represented by a certificate(s), shall bear substantially
the following legend until (i) such Conversion Shares shall have been registered under the Securities Act and effectively disposed of
in accordance with a registration statement that has been declared effective or (ii) in the opinion of counsel acceptable to the Company,
such Conversion Shares may be sold in reliance on an available exemption without registration under the Securities Act, as well as any
applicable “blue sky” or state securities laws:
“THE SHARES REPRESENTED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY APPLICABLE STATE SECURITIES
LAWS. SUCH SHARES HAVE BEEN ACQUIRED FOR INVESTMENT PURPOSES AND MAY NOT BE OFFERED FOR SALE, SOLD, DELIVERED AFTER SALE, TRANSFERRED,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FILED BY THE ISSUER WITH THE U.S. SECURITIES AND EXCHANGE
COMMISSION COVERING SUCH SHARES UNDER THE SECURITIES ACT OR AN OPINION OF COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.
13. CONSTRUCTION; HEADINGS. This
Note shall be deemed to be jointly drafted by the Company and the Holder and shall not be construed against any 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.
Terms used in this Note but defined in the other Transaction Documents shall have the meanings ascribed to such terms on the Closing Date
in such other Transaction Documents unless otherwise consented to in writing by the Holder.
14. 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.
15. NOTICES; CURRENCY; PAYMENTS.
(a) Notices. Any notice or other
communication required or permitted to be given hereunder shall be in writing sent by mail, facsimile with printed confirmation, nationally
recognized overnight carrier or personal delivery and shall be effective upon actual receipt of such notice, to the following addresses
until notice is received that any such address or contact information has been changed:
To the Company: Splash
Beverage Group, Inc.
1314
East Las Olas Blvd., Suite 221
Fort Lauderdale, Florida
33316
Attn: Robert Nistico
With another copy
(which shall not constitute
Notice) to: Sichenzia
Ross Ference LLP
1185 Avenue of the Americas,
31st Floor
New York, NY 10036
Facsimile: 212-930-9725
Attn: Darrin M. Ocasio
To Holder:
With another copy
(which shall not constitute
Notice) to: Name
Address
(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.
(c) Payments. The Company will make
all payments of Principal and Interest under this Note by wire transfer of immediately available funds to the bank account specified by
the Holder in written notice delivered to the Company on or before each Repayment Date.
16. CANCELLATION. After all Principal,
accrued Interest, and other amounts at any time owed on this Note have been paid in full or converted in full, this Note shall automatically
be deemed canceled, shall be surrendered to the Company for cancellation and shall not be reissued.
17. WAIVER OF JURY TRIAL. Each
party hereby waives its right to a jury trial in connection with any suit, action or proceeding in connection with any matter relating
to this Note.
18. GOVERNING
LAW. This Note shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to its
principles regarding conflicts of law.
19.
Reserved.
20. 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.
21. CERTAIN DEFINITIONS. For purposes
of this Note, the following terms shall have the following meanings:
(a) ”Affiliate” means
any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with
a Person, as such terms are used in and construed under Rule 405 under the Securities Act.
(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.
| (c) | “Common Stock Equivalents”
means any securities of the Company or any subsidiary which would entitle the holder thereof to acquire at any time Common Stock, including,
without limitation, any debt, preferred stock, right, option, warrant, unit, or other instrument that is at any time convertible into
or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock. |
| (d) | “Exempt Issuance”
means the issuance of (a) shares of Common Stock or options to employees,
officers, directors, advisors or independent contractors of the Company; provided, however, that such issuance is approved by a
majority of the board of directors of the Company, (b) shares of Common Stock, warrants or options to advisors or independent contractors
of the Company for compensatory purposes, (c) securities upon the exercise or exchange of or conversion of any securities issued hereunder
and/or other securities exercisable or exchangeable for or convertible into shares of Common Stock issued and outstanding on the date
hereof, provided that such securities have not been amended since the date hereof to increase the number of such securities or to decrease
the exercise price, exchange price or conversion price of such securities, (d) securities issuable pursuant to any contractual anti-dilution
obligations of the Company in effect as of the date hereof, provided that such obligations have not been materially amended since the
date of hereof, and (e) securities issued pursuant to acquisitions or any other strategic transactions approved by a majority of the disinterested
members of the Board of Directors, provided that any such issuance shall not include a transaction in which the Company is issuing securities
primarily for the purpose of raising capital or to an entity whose primary business is investing in securities. |
| (e) | “Maturity Date” shall
mean ____________. |
| (f) | “Person” means “person”
as such term is used for purposes of Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended, including any individual,
corporation, limited liability company, partnership, trust, unincorporated organization, government or any agency or political subdivision
thereof, or any other entity or any group of persons. |
| (g) | “Securities Act” means the
Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. |
| (h) | “Trading Day”
means a day on which the principal Trading Market is open for trading. |
| (i) | “Trading Market”
means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the
NYSE American; the Nasdaq Capital Market; the Nasdaq Global Market; the Nasdaq Global Select Market; the New York Stock Exchange; any
level of the OTC Markets operated by OTC Markets Group, Inc. or the OTC Bulletin Board (or any successors to any of the foregoing). |
| (j) | “Transaction Documents” means, collectively, this Note,
the Securities Purchase Agreement, between the Company and the Holder dated ___________ and the other agreements and instruments entered
into or delivered by any of the parties hereto in connection with the transactions contemplated by the APA, as may be amended from time
to time. |
[signature page follows]
[SIGNATURE PAGE TO THE CONVERTIBLE
PROMISSORY NOTE]
IN WITNESS WHEREOF, the Company
has caused this Note to be duly executed as of the Issuance Date set out above.
|
COMPANY: |
|
Splash Beverage Group, Inc. |
|
A Nevada Corporation |
|
By |
|
|
Name: Robert Nistico |
|
Title: CEO |
EXHIBIT 1
Form of Conversion Notice
Splash Beverage Group, Inc.
1314 East Las Olas Blvd., Suite 221
Fort Lauderdale, Florida 33316
Attn: Chief Financial Officer
The undersigned hereby elects
to convert certain outstanding amount as set forth below of the 12% Convertible Promissory Note of Splash Beverage Group, Inc., a Nevada
corporation (the “Company”), issuance date __________, into shares of common stock (the “Common Stock”),
of the Company according to the conditions hereof, as of the date written below. If shares of Common Stock are to be issued in the name
of a person other than the undersigned, the undersigned will pay all transfer taxes payable with respect thereto and is delivering herewith
such certificates and opinions as reasonably requested by the Company in accordance therewith. No fee will be charged to the holder for
any conversion, except for such transfer taxes, if any.
The undersigned agrees to comply
with the delivery requirements under the applicable securities laws in connection with any transfer of the aforesaid shares of Common
Stock.
Conversion calculations:
Principal Amount of Note to be Converted:
$_____
The Amount of Interest of the Note to be
Converted: $____
Conversion Price per Share: $_____
Number of Shares of Common Stock to be Issued
upon Conversion: ________
Signature: ____________________________
Name (Print): _________________________
Mailing Address: ______________________
______________________
Phone number: ________________________
Email: _______________________________
Date: ________________________________
12
EXHIBIT 99.1
Splash Beverage Group Reports Second
Quarter 2023 Financial Results
Quarterly Revenues Rise 15%, Six
Month Revenues Rise 31%
Quarterly Gross Profit Increase 32%
Six Month Gross Profit Increases 34%
Fort Lauderdale, Florida, August 14, 2023 -- Splash
Beverage Group, Inc. (NYSE American: SBEV) (“Splash” or the “Company”), a portfolio company of leading
beverage brands, today reported financial results for the second quarter period ended June 30, 2023. Investors are encouraged to
read the Company’s quarterly report on Form 10-Q which was filed with the Securities and Exchange Commissions (the “SEC”),
contains additional information, and is posted at https://splashbeveragegroup.com/.
Second Quarter Financial Performance
| ● | Net
revenues
for
the
second
quarter
period
ending
June
30,
2023,
were
$5.2
million
compared
to
$4.5
million
in
the
prior
year
period,
an
increase
of
15%
over
the
prior
year
period.
For
the
six-month
period,
revenues
reached
$11.0
million
compared
to
$8.4
million
in
the
prior
year
period
and
an
increase
of
31%.
The
increase
in
revenue
was
primarily
due
to
increased
sales
from
our
B2B
and
B2C
e-commerce
platform,
Qplash,
which
reflected
an
increase
in
territory
coverage,
new
products
and
larger
purchases
per
customer.
In
the
six-month
period,
overall
e-commerce
sales
increased
43%
over
the
prior
year
period
and
the
beverage
business
increased
7%. |
| ● | Gross
profit
for
the
second
quarter
period
ending
June
30,
2023,
was
$1.7
million
compared
to
$1.3
million
in
the
prior
year
period.
Gross
margin
in
the
second
quarter
of
32%
was
a
90-basis
point
improvement
over
the
prior
year
period,
with
cost
efficiencies
and
product
mix
driving
the
improvements.
Six-month
gross
profit
was
$3.5
million
compared
to
$2.6
million
in
the
prior
year
period,
a
34.6%
increase.
|
| ● | TapouT
Energy
Drink
launched
towards
the
end
of
the
second
quarter
as
the
Company
eyes
second
half
impact. |
| ● | The
second
quarter
net
loss
was
$5.6
million
compared
to
$5.7
million
in
the
prior
year
period.
Increases
in
freight
cost,
amazon
fees,
marketing
expenses
and
salary
and
wages
in
2023
to
support
the
revenue
growth
impact
loses
in
the
quarter.
|
| ● | As
of
June
30,
2023,
the
company
had
total
cash
and
cash
equivalents
of
$903,235,
compared
with
$4.4
million
at
December
31,
2022 |
| ● | Subsequently
the
Company
has
raised
additional
$2.7
Million
from
legacy
investors
and
entered
into
a
favorable
credit
facility
agreement
for
$10
million.
|
Robert Nistico, Splash Beverage Group’s Chairman and
CEO, commented, “Our 2023 second quarter results reflect the strengths that we are developing as we grow the business as
well as some of the challenges that inevitably emerge in growth businesses. Our Qplash platform, which has increased 43% in the
first half of the year compared to last year, is developing very nicely on both a B2B and B2C basis and is now expanding to select
international markets. We look for continued contributions from that business. Our quarterly
beverage revenues were down slightly in the second quarter,
but we attribute that to buying patterns of distributors which can have an impact of timing of sales. The first half beverage sales
increased modestly at 7% overall, so we expect a greater upward trend the second half of the year. The beverage business generally
“stair steps” it’s way to growth … you focus on distribution, support those new placements with marketing
and the cycle starts over again. In total, we are where we believe we are supposed to be.”
“Subsequent to the second quarter reporting period,”
Nistico continued, “We disclosed an additional $2.7 million raise from existing investors and a $10 million credit facility
which will not only provide us with needed growth capital, but also allows us to withdraw the much larger $200 million shelf offering
which has been the source of some investor concern. We remain committed to executing a business plan that relies on 4 key pillars
for success. We have a strong management team, we have a diverse portfolio of brands that match consumer trends, our marketing
strategy continues to yield new distribution agreements and retail authorizations, and we have the financial flexibility we need.
We look forward to the second half of 2023.”
About Splash Beverage Group, Inc.
Splash Beverage Group, an innovator
in the beverage industry, owns a growing portfolio of alcoholic and non-alcoholic beverage brands including Copa di Vino wine by
the glass, SALT flavored tequilas, Pulpoloco sangria, and TapouT performance hydration and recovery drink. Splash’s strategy
is to rapidly develop early-stage brands already in its portfolio as well as acquire and then accelerate brands that have high
visibility or are innovators in their categories. Led by a management team that has built and managed some of the top brands in
the beverage industry and led sales from product launch into the billions, Splash is rapidly expanding its brand portfolio and
global distribution.
For more information visit:
www.SplashBeverageGroup.com
www.copadivino.com
www.drinksalttequila.com
www.pulpo-loco.com
www.tapoutdrinks.com
Forward-Looking
Statement
This press
release includes “forward-looking statements” within the meaning of U.S. federal securities laws. Words such as “expect,”
“estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,”
“plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,”
“potential,” “continue” and similar expressions are intended to identify such forward-looking statements.
These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially
from the expected results and, consequently, you should not rely on these forward-looking statements as predictions of future events.
These forward-looking statements and factors that may cause such differences include, without limitation, the risks disclosed in
the Company’s Annual Report on Form 10-K filed with the SEC on March 31, 2022, and in the Company’s other filings with
the SEC. Readers are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date
made. Except as required by law, the Company disclaims any obligation to update or publicly announce any revisions to any of the
forward-looking statements contained in this press release.
Contact Information:
Splash Beverage Group
Info@SplashBeverageGroup.com
954-745-5815
Splash Beverage Group, Inc. |
Condensed Consolidated Balance Sheets |
June 30, 2023 and December 31, 2022 |
| |
June 30, 2023 | |
December 31, 2022 |
Assets | |
| (unaudited) | | |
| | |
Current assets: | |
| | | |
| | |
Cash and cash equivalents | |
$ | 903,235 | | |
$ | 4,431,745 | |
Accounts receivable, net | |
| 1,954,508 | | |
| 1,812,110 | |
Prepaid expenses | |
| 397,025 | | |
| 348,036 | |
Inventory | |
| 3,447,292 | | |
| 3,721,307 | |
Other receivables | |
| 192,942 | | |
| 344,376 | |
Total current assets | |
| 6,895,002 | | |
| 10,657,574 | |
| |
| | | |
| | |
Non-current assets: | |
| | | |
| | |
Deposit | |
$ | 49,431 | | |
$ | 49,290 | |
Goodwill | |
| 256,823 | | |
| 256,823 | |
Intangible assets, net | |
| 4,662,054 | | |
| 4,851,377 | |
Investment in Salt Tequila USA, LLC | |
| 250,000 | | |
| 250,000 | |
Operating lease right of use asset | |
| 595,913 | | |
| 750,042 | |
Property and equipment, net | |
| 423,844 | | |
| 489,597 | |
Total non-current assets | |
| 6,238,065 | | |
| 6,647,129 | |
| |
| | | |
| | |
Total assets | |
$ | 13,133,067 | | |
$ | 17,304,703 | |
| |
| | | |
| | |
Liabilities and Stockholders’ Equity | |
| | | |
| | |
| |
| | | |
| | |
Liabilities: | |
| | | |
| | |
Current liabilities | |
| | | |
| | |
Accounts payable and accrued expenses | |
$ | 3,307,836 | | |
$ | 3,383,187 | |
Liability to issue shares | |
| — | | |
| 91,800 | |
Operating lease liabilities - current | |
| 230,945 | | |
| 268,749 | |
Notes payable, current portion | |
| 4,272,014 | | |
| 1,080,257 | |
Shareholder advances | |
| 200,000 | | |
| — | |
Due to related party | |
| 250,000 | | |
| — | |
Accrued interest payable | |
| 300,658 | | |
| 141,591 | |
Total current liabilities | |
| 8,561,453 | | |
| 4,965,584 | |
| |
| | | |
| | |
Long-term liabilities: | |
| | | |
| | |
Notes payable | |
| 236,657 | | |
| 2,536,319 | |
Operating lease liabilities - noncurrent | |
| 364,959 | | |
| 480,666 | |
Total long-term liabilities | |
| 601,616 | | |
| 3,016,985 | |
| |
| | | |
| | |
Total liabilities | |
| 9,163,069 | | |
| 7,982,569 | |
| |
| | | |
| | |
Stockholders’ equity: | |
| | | |
| | |
Preferred stock, $0.001 par value, 5,000,000 shares authorized, no shares issued | |
| — | | |
| — | |
Common Stock, $0.001 par, 300,000,000 shares authorized, 42,802,186 shares issued, 42,802,186 shares outstanding at June 30, 2023 and 41,085,520 shares issued, 41,085,520 shares outstanding at December 31, 2022 | |
| 42,802 | | |
| 41,086 | |
Additional paid in capital | |
| 125,635,624 | | |
| 121,632,547 | |
Accumulated other comprehensive loss | |
| (37,854 | ) | |
| (20,472 | ) |
Accumulated deficit | |
| (121,670,574 | ) | |
| (112,331,027 | ) |
Total stockholders’ equity | |
| 3,969,998 | | |
| 9,322,134 | |
| |
| | | |
| | |
Total liabilities and stockholders’ equity | |
$ | 13,133,067 | | |
$ | 17,304,703 | |
Splash Beverage Group, Inc. |
Condensed Consolidated Statements of Operations and Comprehensive Loss |
For the Three and Six Months Ended June 30, 2023 and 2022 |
| |
Three months ended June 30 | |
Six months ended June 30, |
| |
2023 | |
2022 | |
2023 | |
2022 |
Net revenues | |
| 5,194,951 | | |
| 4,498,940 | | |
| 11,017,678 | | |
| 8,425,514 | |
Cost of goods sold | |
| (3,417,868 | ) | |
| (3,149,275 | ) | |
| (7,479,096 | ) | |
| (5,784,701 | ) |
Gross profit | |
| 1,777,083 | | |
| 1,349,665 | | |
| 3,538,582 | | |
| 2,640,813 | |
| |
| | | |
| | | |
| | | |
| | |
Operating expenses: | |
| | | |
| | | |
| | | |
| | |
Contracted services | |
| 331,297 | | |
| 327,302 | | |
| 712,302 | | |
| 758,848 | |
Salary and wages | |
| 1,364,136 | | |
| 1,131,612 | | |
| 2,598,263 | | |
| 1,917,263 | |
Non-cash share-based compensation | |
| 641,097 | | |
| 2,772,369 | | |
| 856,857 | | |
| 5,342,494 | |
Other general and administrative | |
| 2,919,533 | | |
| 2,282,471 | | |
| 5,568,234 | | |
| 4,963,853 | |
Sales and marketing | |
| 742,369 | | |
| 665,059 | | |
| 1,479,196 | | |
| 1,171,455 | |
Total operating expenses | |
| 5,998,432 | | |
| 7,178,813 | | |
| 11,214,852 | | |
| 14,153,913 | |
| |
| | | |
| | | |
| | | |
| | |
Loss from continuing operations | |
| (4,221,349 | ) | |
| (5,829,148 | ) | |
| (7,676,270 | ) | |
| (11,513,100 | ) |
| |
| | | |
| | | |
| | | |
| | |
Other income/(expense): | |
| | | |
| | | |
| | | |
| | |
Interest income | |
| 1,320 | | |
| 2,709 | | |
| 1,320 | | |
| 2,709 | |
Interest expense | |
| (172,641 | ) | |
| (73,471 | ) | |
| (339,762 | ) | |
| (159,350 | ) |
Other Income/Expense | |
| (90,585 | ) | |
| — | | |
| 49,819 | | |
| (1 | ) |
Amortization of debt discount | |
| (1,126,994 | ) | |
| — | | |
| (1,374,655 | ) | |
| — | |
Total other income/(expense) | |
| (1,388,900 | ) | |
| (70,762 | ) | |
| (1,663,278 | ) | |
| (156,642 | ) |
| |
| | | |
| | | |
| | | |
| | |
Provision for income taxes | |
| — | | |
| — | | |
| — | | |
| — | |
| |
| | | |
| | | |
| | | |
| | |
Net loss from continuing operations, net of tax | |
| (5,610,249 | ) | |
| (5,899,910 | ) | |
| (9,339,548 | ) | |
| (11,669,742 | ) |
| |
| | | |
| | | |
| | | |
| | |
Net income (loss) from discontinued operations, net of tax | |
| — | | |
| 25,421 | | |
| — | | |
| (199,154 | ) |
| |
| | | |
| | | |
| | | |
| | |
Gain on sale of discontinued operations | |
| — | | |
| 115,632 | | |
| — | | |
| 115,632 | |
| |
| | | |
| | | |
| | | |
| | |
Income of discontinued operations | |
| — | | |
| 141,053 | | |
| — | | |
| (83,522 | ) |
| |
| | | |
| | | |
| | | |
| | |
Net loss | |
$ | (5,610,249 | ) | |
$ | (5,758,857 | ) | |
$ | (9,339,548 | ) | |
$ | (11,753,264 | ) |
| |
| | | |
| | | |
| | | |
| | |
Other Comprehensive Income (Loss) | |
| | | |
| | | |
| | | |
| | |
Foreign currency translation loss | |
| (15,774 | ) | |
| — | | |
| (17,382 | ) | |
| — | |
| |
| | | |
| | | |
| | | |
| | |
Total Comprehensive Income (Loss) | |
$ | (5,626,023 | ) | |
$ | (5,758,857 | ) | |
$ | (9,356,930 | ) | |
$ | (11,753,264 | ) |
| |
| | | |
| | | |
| | | |
| | |
(Loss) per share - continuing operations | |
| | | |
| | | |
| | | |
| | |
Basic and diluted | |
$ | (0.13 | ) | |
$ | (0.16 | ) | |
$ | (0.22 | ) | |
$ | (0.32 | ) |
| |
| | | |
| | | |
| | | |
| | |
Weighted average number of common shares outstanding - continuing operations | |
| | | |
| | | |
| | | |
| | |
Basic and diluted | |
| 42,058,047 | | |
| 36,675,323 | | |
| 41,575,470 | | |
| 35,935,972 | |
v3.23.2
Cover
|
Aug. 15, 2023 |
Document Type |
8-K
|
Amendment Flag |
false
|
Document Period End Date |
Aug. 15, 2023
|
Entity File Number |
001-40471
|
Entity Registrant Name |
SPLASH
BEVERAGE GROUP, INC.
|
Entity Central Index Key |
0001553788
|
Entity Tax Identification Number |
34-1720075
|
Entity Incorporation, State or Country Code |
NV
|
Entity Address, Address Line One |
1314
East Las Olas Blvd
|
Entity Address, Address Line Two |
Suite 221
|
Entity Address, City or Town |
Fort Lauderdale
|
Entity Address, State or Province |
FL
|
Entity Address, Postal Zip Code |
33301
|
City Area Code |
(954)
|
Local Phone Number |
745-5815
|
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false
|
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false
|
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false
|
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false
|
Entity Emerging Growth Company |
false
|
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|
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Common
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|
Trading Symbol |
SBEV
|
Security Exchange Name |
NYSEAMER
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