Item
1.01. Entry into a Material Definitive Agreement.
On
November 16, 2022, NextPlat Corp (NASDAQ: NXPL, NXPLW) (the “Company” or “NextPlat”) entered into a Securities
Purchase Agreement (the “SPA”) with Progressive Care Inc. (OTCQB: RXMD) (“Progressive Care”), pursuant to which
the Company has agreed to purchase, from time to time during the three year term of the SPA, up to an aggregate of $10 million of secured
convertible debentures from Progressive Care (the “Debentures”). Pursuant to the SPA, all purchases of the Debentures will
be made at the Company’s sole election and the proceeds from each purchase will be used by Progressive Care only as approved by
the Company’s Board of Directors. Until used, the proceeds from each purchase of Debentures will be deposited in a controlled account.
If and when the Company elects to purchase Debentures under the SPA, the minimum principal amount that can be purchased at any time is
$1 million.
In
addition, at the closing of each purchase under the SPA, the Company and Progressive Care will enter into a Registration Rights Agreement
(each, a “Registration Rights Agreement”) pursuant to which Progressive Care will agree to register the shares of Progressive
Care common stock issuable upon conversion in full of the Debentures purchased by the Company at such closing.
In
accordance with the form of Debenture to be used for each purchase under the SPA, each Debenture will be convertible at any time, upon
the Company’s election, to shares of Progressive Care’s common stock at a conversion price of $0.03 per share (as may be
adjusted from time to time for share dividends, share splits, reverse share splits, etc.). In addition, each Debenture will mature on
the third anniversary of its issuance and bear interest at 5.0% per annum, payable quarterly. At the Company’s election, interest
can be paid in cash, shares of Progressive’s common stock, or some combination thereof. Progressive Care has the right to prepay
the Debenture at any time provided that it gives the Company seven (7) business days advance written notice, during which time the Company
could elect to convert the Debenture to Progressive Care common stock. Upon the prepayment of a Debenture, Progressive Care will pay
the Company an amount equal to the sum of: (i) all outstanding principal under such Debenture, plus (ii) all accrued and unpaid interest
under such Debenture through the prepayment date, multiplied by (iii) 110%. While amounts are outstanding under a Debenture, Progressive
Care will be subject to certain restrictive covenants, including with respect to the incurrence of indebtedness, the imposition of liens
on Progressive Care’s assets, changes to the Progressive Care’s organization documents, etc.
In
connection with the SPA, on November 16, 2022, the Company entered into a Security Agreement (the “Security Agreement”) with
Progressive Care and its subsidiaries, Touchpoint RX, LLC, a Florida limited liability company (“Touchpoint”), Family Physicians
RX, Inc., a Florida corporation (“FPRX”), and ClearMetrX Inc., a Florida corporation (“ClearMetrX” and collectively
with Progressive Care, Touchpoint and FPRX, the “Borrower Parties”). Pursuant to the Security Agreement, the Borrower
Parties granted the Company a security interest in all of their respective assets to secure Progressive Care’s obligations under
the Debentures.
The
foregoing summaries of the SPA, Form of Debenture, Security Agreement, and Registration Rights Agreement do not purport to be complete
and are subject to, and qualified in their entirety, by reference to the SPA, Form of Debenture, Security Agreement, and Registration
Rights Agreement attached hereto as Exhibits 10.1, 10.2, 10.3, and 10.4, respectively, which are incorporated herein by reference.