Nextnrg, Inc 8-K, filed Oct 8, 2026
Nextnrg, Inc. (NXXT)
About this 8-K
Nextnrg, Inc filed this 8-K on October 8, 2026, reporting on events of October 7, 2026.
Items reported
- Item 1.01: Entered into a material agreement
- Item 3.03: Change to shareholders' rights
- Item 5.03: Charter or bylaw amendment, or fiscal year change
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
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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).
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Item 1.01 Entry into a Material Definitive Agreement.
As previously reported in the Current Report on Form 8-K filed on August 17, 2026 by NextNRG, Inc. (the “Company”) with the Securities and Exchange Commission (the “SEC”), on August 13, 2026, the Company and certain stockholders of the Company (the “Stockholders”) entered into that certain Voting, Support and Standstill Agreement (the “Original Voting Agreement”), pursuant to which each Stockholder irrevocably agreed to vote all of their shares of common stock and other voting securities of the Company in favor of the Stockholder Proposals (as defined in the Original Voting Agreement) and agreed to vote against any action that would reasonably be expected to impede, interfere with, delay, postpone or adversely affect the approval of such Stockholder Proposals.
On October 7, 2026, the Company and the Stockholders entered into an Amended and Restated Voting, Support and Standstill Agreement effective as of September 30, 2026 (the “Amended Voting Agreement”). The Amended Voting Agreement, among other things, was revised to reflect the Reincorporation (as defined below), certain changes made to the Series C Certificate of Designation (as defined below) to be filed with the Secretary of State of the State of Nevada and a new termination of the Amended Voting Agreement in which it will terminate on the later of (i) the date on which all required stockholder approvals, other than the Split Authorization (as defined in the Amended Voting Agreement) have been obtained and (ii) December 31, 2028, subject to certain exceptions.
The foregoing description of the Amended Voting Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the form of Amended Voting Agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
Item 3.03 Material Modification to Rights of Shareholders.
As previously reported by the Company, on December 29, 2025, at the 2025 annual meeting of stockholders (the “Annual Meeting”), the stockholders of the Company approved a proposal to reincorporate the Company from the State of Delaware to the State of Nevada (the “Reincorporation”) pursuant to the terms of a plan of conversion (the “Plan of Conversion”), as described in the Company’s definitive proxy statement on Schedule 14A for the Annual Meeting filed with the SEC on December 9, 2025 (the “Proxy Statement”).
Pursuant to the Plan of Conversion, the Company effected the Reincorporation as of October 7, 2026 by filing: (i) a certificate of conversion with the Secretary of State of the State of Delaware; (ii) articles of conversion with the Secretary of State of the State of Nevada; (iii) articles of incorporation with the Secretary of State of the State of Nevada (the “Nevada Charter”); and (iv) the certificates of designation for the Series A Convertible Preferred Stock, Series B Convertible Preferred Stock and Series C Convertible Preferred Stock with the Secretary of State of the State of Nevada. The Company also adopted new bylaws (the “Nevada Bylaws”) to reflect the Reincorporation.
At the effective time of the Reincorporation:
| ● | The Company’s state of incorporation changed from the State of Delaware to the State of Nevada. | |
| ● | The affairs of the Company ceased to be governed by the Delaware General Corporation Law and the Company’s existing certificate of incorporation and bylaws, and instead, became governed by the Nevada Revised Statutes, the Nevada Charter and the Nevada Bylaws. | |
| ● | The Company continues to be the same entity and continues with all of the same rights, privileges and powers. | |
| ● | The Company continues to have the same name, possesses all of the same properties, continues with all of the same debts, liabilities and obligations, and continues with the same officers and directors as immediately prior to the Reincorporation. |
| ● | Each outstanding share of common stock of the Delaware corporation was converted into one share of common stock of the Nevada corporation, and each outstanding certificate representing shares of the Delaware corporation is deemed an equivalent certificate representing shares of the Nevada corporation. | |
| ● | Each outstanding share of Series A Convertible Preferred Stock of the Delaware corporation was converted into one share of Series A Convertible Preferred Stock of the Nevada corporation having substantially similar rights, privileges and preferences (the “Series A Preferred Stock”). | |
| ● | Each outstanding share of Series B Convertible Preferred Stock of the Delaware corporation was converted into one share of Series B Convertible Preferred Stock of the Nevada corporation having substantially similar rights, privileges and preferences (the “Series B Preferred Stock”). | |
| ● | Each outstanding share of Series C Convertible Preferred Stock of the Delaware corporation was converted into one share of Series C Convertible Preferred Stock of the Nevada corporation having substantially similar rights, privileges and preferences (the “Series C Preferred Stock”). | |
| ● | All employee benefit and incentive plans of the Delaware corporation continue to be employee benefit and incentive plans of the Nevada corporation. The Company’s employee benefit and incentive plans continue , and each option, equity award or other right issued under such plans by the Delaware corporation was automatically converted into an option, equity award or right to purchase or receive the same number of shares of common stock of the Nevada corporation, at the same price per share, upon the same terms and subject to the same conditions as before the Reincorporation. |
The Reincorporation did not result in any change in the business, physical location, management, assets, liabilities or net worth of the Company, nor did it result in any change in location of the Company’s current employees, including management. The Reincorporation did not affect any of the Company’s material contracts with any third parties, and the Company’s rights and obligations under those material contractual arrangements will continue to be the rights and obligations of the Company after the Reincorporation. The daily business operations of the Company will continue as they were conducted prior to the Reincorporation. The consolidated financial condition and results of operations of the Company immediately after consummation of the Reincorporation remain the same as immediately before the Reincorporation.
As described in the Proxy Statement, certain rights of the Company’s stockholders were changed as a result of the Reincorporation. A more detailed description of the Plan of Conversion, Nevada Charter, and Nevada Bylaws, and the effects of the Reincorporation, are set forth in the Proxy Statement under the heading “Proposal 3-Reincorporation to the State of Nevada by Conversion,” and the description contained therein is incorporated herein by reference. Copies of the Plan of Conversion, the Nevada Charter and the Nevada Bylaws are attached hereto as Exhibits 2.1, 3.1 and 3.2, respectively, to this Current Report on Form 8-K and are incorporated by reference herein.
Upon the effectiveness of the Reincorporation, the Company became the successor issuer to the Delaware corporation pursuant to Rule 12g-3(a) under the Securities Exchange Act of 1934, as amended, and the Company’s common stock continues to be listed on The Nasdaq Stock Market LLC under the symbol “NXXT.”
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
To the extent required, the information set forth above under Item 3.03 is hereby incorporated by reference into this Item 5.03.
Series A Preferred Stock
On October 7, 2026, the Company filed a Certificate of Designation of the Series A Convertible Preferred Stock (the “Series A Certificate of Designation”) with the Secretary of State of the State of Nevada in connection with the Reincorporation as disclosed in Item 3.03 of this Current Report on Form 8-K.
The following is a summary of the material terms of the Series A Preferred Stock. Capitalized terms used but not defined herein have the meanings ascribed to them in the Series A Certificate of Designation.
Under the Series A Certificate of Designation, each share of Series A Preferred Stock is convertible, at the holder’s option at any time, into shares of our common stock at a conversion rate equal to the quotient of (i) the $10.00 stated value (the “Series A Stated Value”) divided by (ii) 800% of the Minimum Price, as defined in Rule 5635 of The Nasdaq Stock Market LLC Rules (the “Series A Conversion Price”), subject to specified adjustments for stock splits, stock dividends, reorganizations, reclassifications and other similar events as set forth in the Series A Certificate of Designation.
The Series A Preferred Stock contains limitations that prevent the holder thereof from converting shares of Series A Preferred Stock, or receiving Dividend Shares (as defined below), to the extent the holder and its affiliates would beneficially own more than 9.99% of the total number of shares of our common stock outstanding immediately after giving effect to such conversion or issuance, which percentage may be waived or increased by the holder upon at least 61 days’ prior notice to the Company.
Each holder of shares of Series A Preferred Stock is entitled to receive dividends at the rate of 10% per annum of the Series A Stated Value, which accrue on a quarterly basis for each calendar quarter following the issuance date of the applicable shares of Series A Preferred Stock (the “Series A Dividend”). The Series A Dividend is payable within five Business Days (as defined in the Series A Certificate of Designation) after the end of each calendar quarter through the issuance to the holder of a number of shares of common stock equal to (i) the amount of the Series A Dividend divided by (ii) the Series A Conversion Price in effect on the last Business Day of the preceding calendar quarter, rounded to the nearest whole share (such shares, the “Dividend Shares”). If any Series A Dividend is not paid when due because of limitations set forth in the Series A Certificate of Designation, such Series A Dividend will continue to accrue and the applicable Dividend Shares will be issued when permitted under the Series A Certificate of Designation. The Series A Dividend accrues from the date of issuance of the applicable shares of Series A Preferred Stock, ceases to accrue upon conversion of such shares and is pro-rated for any partial calendar quarter.
Except as otherwise required by law or the Series A Certificate of Designation, holders of Series A Preferred Stock vote together with the holders of common stock as a single class on an as-converted basis, with the number of votes for each share of Series A Preferred Stock calculated, for voting purposes only, using the Minimum Price as of the date of issuance of the Series A Preferred Stock rather than the Series A Conversion Price. The Series A Preferred Stock has no liquidation preference and is not subject to redemption.
The foregoing description does not purport to be complete and is qualified in its entirety by reference to the full text of the Series A Certificate of Designation, filed as Exhibit 3.3 to this Current Report on Form 8-K and incorporated herein by reference.
Series B Preferred Stock
On October 7, 2026, the Company filed a Certificate of Designation of the Series B Convertible Preferred Stock (the “Series B Certificate of Designation”) with the Secretary of State of the State of Nevada in connection with the Reincorporation as disclosed in Item 3.03 of this Current Report on Form 8-K.
The following is a summary of the material terms of the Series B Preferred Stock. Capitalized terms used but not defined herein have the meanings ascribed to them in the Series B Certificate of Designation.
Under the Series B Certificate of Designation, each share of Series B Preferred Stock is convertible, at the holder’s option at any time, into shares of our common stock at a conversion rate equal to the quotient of (i) the $10.00 stated value (the “Series B Stated Value”) divided by (ii) 700% of the Minimum Price, as defined in Rule 5635 of The Nasdaq Stock Market LLC Rules (the “Series B Conversion Price”), subject to specified adjustments for stock splits, stock dividends, reorganizations, reclassifications and other similar events as set forth in the Series B Certificate of Designation.
The Series B Preferred Stock contains limitations that prevent the holder thereof from acquiring shares of our common stock upon conversion that would result in the number of shares beneficially owned by such holder and its affiliates exceeding 9.99% of the total number of shares of our common stock outstanding immediately after giving effect to the conversion.
Each holder of shares of Series B Preferred Stock is entitled to receive dividends at the rate of 12% per annum of the Series B Stated Value, which accrue on a quarterly basis for each calendar quarter following the issuance date of the applicable shares of Series B Preferred Stock (the “Series B Dividend”). The Series B Dividend is payable within five Business Days (as defined in the Series B Certificate of Designation) after the end of each calendar quarter through the issuance to the holder of a number of Dividend Shares equal to (i) the amount of the Series B Dividend divided by (ii) the Series B Conversion Price in effect on the last Business Day of the preceding calendar quarter, rounded to the nearest whole share. If any Series B Dividend is not paid when due because of limitations set forth in the Series B Certificate of Designation, such Series B Dividend will continue to accrue and the applicable Dividend Shares will be issued when permitted under the Series B Certificate of Designation. The Series B Dividend accrues from the date of issuance of the applicable shares of Series B Preferred Stock, ceases to accrue upon conversion of such shares and is pro-rated for any partial calendar quarter.
Except as otherwise required by law or the Series B Certificate of Designation, holders of Series B Preferred Stock vote together with the holders of common stock as a single class on an as-converted basis, with the number of votes for each share of Series B Preferred Stock calculated, for voting purposes only, using the Minimum Price as of the date of issuance of the Series B Preferred Stock rather than the Series B Conversion Price. The Series B Preferred Stock has no liquidation preference and is not subject to redemption.
The foregoing description does not purport to be complete and is qualified in its entirety by reference to the full text of the Series B Certificate of Designation, filed as Exhibit 3.4 to this Current Report on Form 8-K and incorporated herein by reference.
Series C Preferred Stock
On October 7, 2026, the Company filed a Certificate of Designation of the Series C Convertible Preferred Stock (the “Series C Certificate of Designation”) with the Secretary of State of the State of Nevada in connection with the Reincorporation as disclosed in Item 3.03 of this Current Report on Form 8-K.
The following is a summary of the material terms of the Series C Preferred Stock. Capitalized terms used but not defined herein have the meanings ascribed to them in the Series C Certificate of Designation.
General. The Series C Certificate of Designation authorizes the issuance of up to 3,000,000 shares of Series C Preferred Stock with a par value of $0.0001 per share and a stated value of $10.00 per share (as may be increased in accordance with the terms of the Series C Certificate of Designation, the “Stated Value”). On the two year anniversary of the issuance date of each share of Series C Preferred Stock, the Stated Value of such share will automatically increase by 10% of the then Stated Value of such share. In addition, each successive month after such two-year anniversary, the then Stated Value of such share of Series C Preferred Stock will increase by an additional amount equal to (i) 10% of the then Stated Value of such share, multiplied by (ii) a fraction, (A) the numerator of which is the number of calendar days during the immediately preceding monthly period on which a Conversion Floor Price Condition (as defined in the Series C Certificate of Designation) existed and (B) the denominator of which is the number of calendar days in such monthly period each successive month after such two-year anniversary.
Dividends. Each share of Series C Preferred Stock accrues dividends at an annual rate of 12.5% of the Stated Value, payable monthly in arrears on the first Trading Day of each calendar month, at the Company’s election, in cash, in shares of Common Stock (subject to satisfaction of the Equity Conditions) or by increasing the Stated Value of such holder’s shares of Series C Preferred Stock. From and after the occurrence and during the continuance of any Mandatory Redemption Event or Trigger Event, the dividend rate increases to 18% per annum and the Company may not pay dividends in shares of Common Stock.
Conversion. Each share of Series C Preferred Stock is convertible at any time at the option of the holder into shares of Common Stock at a conversion rate determined by dividing the Conversion Amount (the sum of the Stated Value, accrued and unpaid dividends, and other unpaid amounts) multiplied by 105% by the Conversion Price. The initial Conversion Price for shares originally issued by the Delaware corporation on August 13, 2026 is $7.50 per share and, for shares issued at any time after August 13, 2026, the Conversion Price will be equal to the greater of (i) the then applicable Floor Price (as defined in the Series C Certificate of Designation) and (ii) 150% of the lower of (x) the closing price on the Trading Day immediately prior to issuance and (y) the average closing price for the five Trading Days immediately preceding issuance. Holders may also elect an alternate conversion at a price equal to the lower of the Conversion Price and the greater of the Floor Price and 95% of the lowest daily VWAP during the fifteen (15) consecutive Trading Day period ending immediately preceding the conversion (which percentage is reduced to 80% during the continuance of any Mandatory Redemption Event or Trigger Event, in which case the Conversion Amount is also multiplied by 120%) (the “Alternate Conversion Price”). Holders may also reserve an Alternate Conversion Price for use at a later date with regard to a specific number of shares of Series C Preferred Stock by delivering a reservation notice to the Company reserving such Alternate Conversion Price for such specific shares.
Voting Rights. Shares of Series C Preferred Stock do not entitle the holders to vote on matters on which holders of Common Stock are entitled to vote until such shares have been converted into Conversion Shares. However, the affirmative vote of a majority of the then-outstanding shares of Series C Preferred Stock is required to (a) alter or change adversely the powers, preferences or rights of the Series C Preferred Stock, (b) amend the Nevada Charter in any manner that adversely affects the holders’ rights, or (c) enter into any agreement with respect to the foregoing.
Liquidation Preference. Upon any liquidation, dissolution or winding-up of the Company, the holders are entitled to receive the greater of (a) the aggregate Stated Value plus any unpaid dividends and any other amounts owed to such holders or (b) the amount holders would receive if the shares were fully converted into Common Stock at the Alternate Conversion Price, paid pari passu with all holders of Common Stock.
Redemption. Upon the occurrence of a Mandatory Redemption Event (including failure to pay dividends or other amounts when due, material breach of the Transaction Documents, voluntary bankruptcy, certain conversion failures, certain Fundamental Transactions and certain other events), holders may require the Company to redeem their shares in cash at 125% of the sum of the Stated Value, accrued and unpaid dividends and other amounts owed. In addition, upon the occurrence of a Mandatory Redemption Event, holders may elect to increase the Stated Value of such holders outstanding shares of Series C Preferred Stock by 10%. Each holder may make such an election no more than 3 times in the aggregate.
Trigger Events. Upon each occurrence of a Trigger Event (including involuntary bankruptcy, suspension or delisting of the Common Stock, certain registration statement failures, failure to obtain Stockholder Approval, certain judgments and defaults on other indebtedness, a Material Adverse Effect and certain other events), the Stated Value of all outstanding shares of Series C Preferred Stock automatically increases by 25%. In addition, for so long as any Trigger Event or Mandatory Redemption Event is continuing, the Stated Value increases by an additional 10% for each thirty (30) calendar day period beginning on the thirty-first (31st) calendar day following its occurrence, subject to certain exceptions. Such additional increase in Stated Value applies separately to each individual Trigger Event or Mandatory Redemption Event and, should such Trigger Event or Mandatory Redemption Event be cured during the thirty (30) calendar day period, then the Stated Value of such shares of Series C Preferred Stock eligible for such increase will be increased pro rata based on the number of calendar days in such thirty (30) day period remaining prior to such cure.
Beneficial Ownership Limitation. The Series C Preferred Stock may not be converted to the extent that, after giving effect to such conversion, the holder and its Affiliates and Attribution Parties (each as defined in the Series C Certificate of Designation) would beneficially own in excess of 4.99% (or, upon election by a holder prior to issuance, 9.99%) of the outstanding shares of Common Stock.
Anti-Dilution Protection. The Conversion Price is subject to full-ratchet anti-dilution adjustment upon the issuance of Common Stock (or securities convertible into Common Stock) at a price below the then-current Conversion Price, subject to certain excluded securities. The Conversion Price is also subject to standard adjustments for stock splits, stock dividends, stock combinations and other such similar events.
Ranking. The Series C Preferred Stock ranks senior to the Common Stock, Series A Preferred Stock, and Series B Preferred Stock with respect to dividends, distributions, and payments upon liquidation, dissolution, and winding up of the Company.
The foregoing description does not purport to be complete and is qualified in its entirety by reference to the full text of the Series C Certificate of Designation, filed as Exhibit 3.5 to this Current Report on Form 8-K and incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: October 7, 2026 | NEXTNRG, INC. (Registrant) | |
| By: | /s/ Michael D. Farkas | |
| Name: | Michael D. Farkas | |
| Title: | Chief Executive Officer | |
Exhibit 2.1
ANNEX A
Plan of Conversion
(Attached)
PLAN OF CONVERSION OF
NEXTNRG, INC.
Dated as of October 7, 2026
Subject to the approval of the stockholders of NextNRG, Inc., a Delaware corporation (the “Company”), this Plan of Conversion (together with the exhibits hereto, the “Plan”) is entered into by the Company and sets forth the terms of the conversion of the Company from a Delaware corporation to a Nevada corporation, pursuant to the provisions of the Delaware General Corporation Law (the “DGCL”) and the Nevada Revised Statutes (the “NRS”).
| 1. | The Company was formed in the State of Delaware on March 28, 2019. |
| 2. | Section 266 of the DGCL permits the conversion of a Delaware corporation to a corporation organized under the laws of another State. |
| 3. | Chapter 78 and Chapter 92A of the NRS, including Section 92A.195 thereof, permits the conversion of a Delaware corporation into a Nevada corporation. |
| 4. | Upon the terms and subject to the conditions of this Plan and in accordance with the DGCL and the NRS, the Company will be converted into a Nevada corporation (the “Conversion”) to be named NextNRG, Inc. (the “Corporation”). |
| 5. | This Plan shall be effective following its approval by the stockholders of the Company and the filing of a Certificate of Conversion, substantially in the form as attached hereto as Exhibit A with the Secretary of State of the State of Delaware and Articles of Conversion, substantially in the form as attached hereto as Exhibit B, and the Articles of Incorporation for the Corporation (the “Articles of Incorporation”), substantially in the form as attached hereto as Exhibit C, with the Secretary of State of the State of Nevada. |
ARTICLE I. ARTICLE I. THE CONVERSION
Section 1.01 The Conversion. At the Effective Time, the Company shall be converted into the Corporation and, for all purposes of the laws of the State of Delaware and the State of Nevada, the Conversion shall be deemed a continuation of the existence of the Company in the form of a Nevada corporation. At the Effective Time, for all purposes of the laws of the State of Delaware and the State of Nevada, all of the rights, priv ileges and powers of the Company, and all property, real, personal and mixed, and all debts due to the Company, as well as all other things and causes of action belonging to the Company, shall thereby become vested in the Corporation and shall be the property of the Corporation, and the title to any real property vested by deed or otherwise in the Company shall not revert or be in any way impaired by reason of any provision of the NRS; but all rights of creditors and all liens upon any property of the Company shall be preserved unimpaired, and all debts, liabilities and duties of the Company shall be deemed to be those of the Corporation, and may be enforced against the Corporation to the same extent as if said debts, liabilities and duties had originally been incurred or contracted by it in its capacity as a corporation.
Section 1.02 Effective Time. The Conversion shall become effective upon the filing of a Certificate of Conversion with the Secretary of State of the State of Delaware and Articles of Conversion and the Articles of Incorporation with the Secretary of State of the State of Nevada (such time of effectiveness, the “Effective Time”). The officers of the Company shall select the date and time that the Effective Time occurs.
| A-1 |
Section 1.03 Articles of Incorporation and Bylaws of the Corporation. At and after the Effective Time, the Corporation shall be governed by the Articles of Incorporation, and the Board of Directors of the Corporation shall adopt bylaws for the Corporation substantially in the form as attached hereto as Exhibit D (the “Bylaws”).
Section 1.04 Directors and Officers. The initial directors of the Corporation shall be as set forth in the Articles of Incorporation, who shall be named to the initial Board of Directors of the Corporation. The initial officers of the Corporation shall be determined by the Board of Directors of the Corporation, promptly following the Conversion, in each case until their respective successors are duly elected or appointed and qualified.
Section 1.05 Termination. This Plan may be terminated and the Conversion abandoned at any time prior to the Effective Time by the action of the Board of Directors of the Company. In the event of termination of this Plan and abandonment of the Conversion, this Plan shall become void and of no further force and effect without liability on the part of any party hereto or their respective officers and agents.
ARTICLE II. ARTICLE II. CONVERSION; CERTIFICATES; COVENANTS
Section 2.01 Conversion of Shares.
(a) At the Effective Time, by virtue of the Conversion and without any action on the part of the Company or the stockholders of the Company, each share of common stock of the Company, par value $0.0001, shall be converted into one share of common stock, par value $0.0001 per share (the “Common Stock”) o the Corporation (the “Conversion Rate”).
(b) Following the filing of the Certificate of Designations of Preferences and Rights of Series A Convertible Preferred Stock of the Corporation in the form as attached hereto as Exhibit E immediately after the Effective Time, each share of Series A Convertible Preferred Stock, par value $0.0001, of the Company shall be converted into one share of Series A Convertible Preferred Stock, par value $0.0001, of the Corporation (the “Series A Stock”).
(c) Following the filing of the Certificate of Designations of Preferences and Rights of Series B Convertible Preferred Stock of the Corporation in the form as attached hereto as Exhibit F immediately after the Effective Time, each share of Series B Convertible Preferred Stock, par value $0.0001, of the Company shall be converted into one share of Series B Convertible Preferred Stock, par value $0.0001, of the Corporation (the “Series B Stock”).
(d) Following the filing of the Certificate of Designations of Preferences and Rights of Series c Convertible Preferred Stock of the Corporation in the form as attached hereto as Exhibit G immediately after the Effective Time, each share of Series C Convertible Preferred Stock, par value $0.0001, of the Company shall be converted into one share of Series C Convertible Preferred Stock, par value $0.0001, of the Corporation (the “Series C Stock”).
(e) All warrants, options and other rights to acquire shares of common stock of the Company outstanding at the time of the Conversion shall automatically be converted to the right to receive Common Stock at the Conversion Rate, with equitable adjustments to the purchase price or conversion terms thereof, and shall thereafter constitute a right to acquire the Common Stock as set forth herein and therein.
Section 2.02 Recordation of Shares.
| (a) | Shares of Common Stock, Series A Stock and Series B Stock issued in connection with the Conversion shall be uncertificated unless otherwise determined by the Board of Directors of the Corporation, and the Corporation shall record such shares of Common Stock, Series A Stock and Series B Stock into which the common stock of the Company, the Series A Convertible Preferred Stock of the Company and the Series B Convertible Preferred Stock of the Company, as applicable, shall have been converted as a result of the Conversion in book-entry form in the books and records of the Corporation. |
| A-2 |
| (b) | The shares of Common Stock issued upon the conversion of the common stock of the Company in accordance with the terms hereof shall be deemed to have been issued in full satisfaction of all rights pertaining to such shares of common stock of the Company, and shall, when issued, be duly authorized, validly issued, fully paid and non-assessable shares of Common Stock, as applicable. |
| (c) | The shares of Series A Stock issued upon the conversion of the Series A Convertible Preferred Stock of the Company in accordance with the terms hereof shall be deemed to have been issued in full satisfaction of all rights pertaining to such shares of Series A Convertible Preferred Stock of the Company, and shall, when issued, be duly authorized, validly issued, fully paid and non-assessable shares of Series A Stock, as applicable. |
| (d) | The shares of Series B Stock issued upon the conversion of the Series B Convertible Preferred Stock of the Company in accordance with the terms hereof shall be deemed to have been issued in full satisfaction of all rights pertaining to such shares of Series B Convertible Preferred Stock of the Company, and shall, when issued, be duly authorized, validly issued, fully paid and non-assessable shares of Series B Stock, as applicable. |
Section 2.03 Covenants.
| (a) | Subject to the terms and conditions of this Plan, the Board of Directors of the Company and the officers of the Company (each, a “Party”) will use their commercially reasonable efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary or desirable to consummate the transactions contemplated by this Plan. Each Party shall execute and deliver such other documents, certificates, agreements and other writings and to take such other actions as may be necessary or appropriate in order to consummate or implement expeditiously the transactions contemplated hereunder. |
| (b) | The Parties agree to treat, for U.S. federal, state and local Tax purposes, the transactions contemplated by this Plan as governed by Section 368 of Internal Revenue NRS of 1986, as amended, and to report consistently with such treatment for all U.S. federal, state and local Tax purposes. |
ARTICLE III. ARTICLE III. MISCELLANEOUS
Section 3.01 Governing Law. This Plan shall be governed by, enforced, and construed under and in accordance with the laws of the State of Delaware and the laws of the State of Nevada, without giving effect to the principles of conflicts of law thereunder.
Section 3.02 Entire Agreement. This Plan represent the entire agreement between the Parties relating to the subject matter thereof and supersedes all prior
agreements, understandings and negotiations, written or oral, with respect to such subject matter.
Section 3.03 Amendment; Waiver. At any time prior to the Effective Date, this Plan may be amended, modified, superseded, terminated or cancelled, and any of the terms, covenants, representations, warranties or conditions hereof may be waived, only by a written instrument executed by the Board of Directors and stockholders of the Company holding a majority of the voting power of the Company.
Section 3.04 Headings. The headings contained in this Plan are intended solely for convenience and shall not affect the rights of the Parties.
[Signature appears on following page]
| A-3 |
In witness whereof, the Company has entered into this Plan as of the date first set forth above.
| NextNRG, Inc. | ||
| By: | /s/ Michael D. Farkas | |
| Name: | Michael D. Farkas | |
| Title: | Chief Executive Officer | |
Exhibit A
Delaware Certificate of Conversion
(Attached)
STATE OF DELAWARE CERTIFICATE OF
CONVERSION FROM A DELAWARE CORPORATION
TO A NON-DELAWARE ENTITY PURSUANT TO
SECTION 266 OF
THE DELAWARE GENERAL CORPORATION LAW
| 1. | The name of the Delaware corporation is Next NRG, Inc. | |
| (If changed, the name under which it’s Certificate of Incorporation was originally filed: EZFill Holdings, Inc.) |
| 2. | The date of filing of its original Certificate of Incorporation with the Delaware Secretary of State is March 28, 2019. | |
| 3. | The jurisdiction to which the corporation shall convert is (list jurisdiction) Nevada NextNRG, Inc. and the name under which the entity shall be known is NextNRG, Inc. | |
| 4. | The conversion has been approved in accordance with Section 266 of the Delaware General Corporation Law. | |
| 5. | The corporation agrees that it may be served with process in the State of Delaware in any action, suit or proceeding for enforcement of any obligation of the corporation arising while it was a corporation of the State of Delaware, as well as for enforcement of any obligation of such other entity arising from the conversion, including any suit or other proceeding to enforce the right of any stockholders as determined in appraisal proceedings pursuant to Section 262 of Title 8, and irrevocably appoints the Secretary of State of Delaware as its agent to accept service of process in any such action, suit or proceeding. | |
| 6. | The address to which a copy of the process shall be mailed by the Secretary of State is 407 Lincoln Rd. #9F, Miami Beach, Florida 33190. |
IN WITNESS WHERE OF, the undersigned have executed this Certificate on the 7th day of October, A.D. 2026
| By: | /s/ Michael D. Farkas | |
| Authorized Officer | ||
| Name: | Michael D. Farkas | |
| Print or Type |
Exhibit B
Nevada Articles of Conversion
Exhibit 3.1
ARTICLES OF INCORPORATION OF
NextNRG, Inc.
The undersigned incorporator, in order to form a corporation pursuant to the Nevada Revised Statutes (the “NRS”), Chapter 78, certifies as follows:
Section 1. Name. The name of the corporation is NextNRG, Inc. (the “Corporation”).
Section 2. Incorporator; Registered Office and Agent
| (a) | Incorporator. The name and mailing address of the incorporator are: Michael D. Farkas, 407 Lincoln Rd. #9F, Miami Beach, Florida 33190. The powers of the incorporator are to terminate upon the filing of these Articles of Incorporation with the Secretary of State of the State of Nevada, and the initial directors of the Corporation shall be as set forth in Section 7. |
| (b) | Registered Agent. The name and address of the registered agent of the Corporation in the State of Nevada is Corporate Creations Network Inc., 8275 South Eastern Avenue #200, Las Vegas, NV 89123, or such other agent and address as the Board of Directors of the Corporation (the “Board”) shall from time to time select. |
Section 3. Purpose and Business. The purpose of the Corporation is to engage in any lawful act or activity for which corporations may now or hereafter be organized under the NRS, including, but not limited to the following:
| (a) | The Corporation may at any time exercise such rights, privileges, and powers, when not inconsistent with the purposes and object for which this Corporation is organized. |
| (b) | The Corporation shall have the power to have succession by its corporate name in perpetuity, or until dissolved and its affairs wound up according to law. |
| (c) | The Corporation shall have the power to sue and be sued in any court of law or equity. |
| (d) | The Corporation shall have the power to make contracts. |
| (e) | The Corporation shall have the power to hold, purchase and convey real and personal estate and to mortgage or lease any such real and personal estate with its franchises. The power to hold real and personal estate shall include the power to take the same by devise or bequest in the State of Nevada, or in any other state, territory or country. |
| (f) | The Corporation shall have the power to appoint such officers and agents as the affairs of the Corporation shall requite and allow them suitable compensation. |
| (g) | The Corporation shall have the power to make bylaws not inconsistent with the constitution or laws of the United States, or of the State of Nevada, for the management, regulation and government of its affairs and property, the transfer of its stock, the transaction of its business and the calling and holding of meetings of shareholders. |
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| (h) | The Corporation shall have the power to wind up and dissolve itself, or be wound up or dissolved. |
| (i) | The Corporation shall have the power to adopt and use a common seal or stamp, or to not use such seal or stamp and if one is used, to alter the same. The use of a seal or stamp by the Corporation on any corporate documents is not necessary. The Corporation may use a seal or stamp, if it desires, but such use or non-use shall not in any way affect the legality of the document. |
| (j) | The Corporation shall have the power to borrow money and contract debts when necessary for the transaction of its business, or for the exercise of its corporate rights, privileges or franchises, or for any other lawful purpose of its incorporation; to issue bonds, promissory notes, bills of exchange, debentures and other obligations and evidence of indebtedness, payable at a specified time or times, or payable upon the happening of a specified event or events, whether secured by mortgage, pledge or otherwise, or unsecured, for money borrowed, or in payment for property purchased, or acquired, or for another lawful object. |
| (k) | The Corporation shall have the power to guarantee, purchase, hold, sell, assign, transfer, mortgage, pledge or otherwise dispose of the shares of the capital stock of, or any bonds, securities or evidence in indebtedness created by any other corporation or corporations in the State of Nevada, or any other state or government and, while the owner of such stock, bonds, securities or evidence of indebtedness, to exercise all the rights, powers and privileges of ownership, including the right to vote, if any. |
| (l) | The Corporation shall have the power to purchase, hold, sell and transfer shares of its own capital stock and use therefore its capital, capital surplus, surplus or other property or fund. |
| (m) | The Corporation shall have the power to conduct business, have one or more offices and hold, purchase, mortgage and convey real and personal property in the State of Nevada and in any of the several states, territories, possessions and dependencies of the United States, the District of Columbia and in any foreign country. |
| (n) | The Corporation shall have the power to do all and everything necessary and proper for the accomplishment of the objects enumerated in these Articles of Incorporation, or any amendments thereof, or necessary or incidental to the protection and benefit of the Corporation and, in general, to carry on any lawful business necessary or incidental to the attainment of the purposes of the Corporation, whether or not such business is similar in nature to the purposes set forth in these Articles of Incorporation, or any amendment thereof. |
| (o) | The Corporation shall have the power to make donations for the public welfare or for charitable, scientific or educational purposes. | |
| (p) | The Corporation shall have the power to enter partnerships, general or limited, or joint ventures, in connection with any lawful activities. Section 4.Capital Stock. |
| (a) | Classes and Number of Shares. The total number of shares of all classes of stock, which the Corporation shall have authority to issue shall be five hundred million (500,000,000) shares of common stock, par value of $0.0001 per share (the “Common Stock”) and fifty million (50,000,000) shares of preferred stock, par value of $0.0001 per share (the “Preferred Stock”). |
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| (b) | Powers and Rights of Common Stock. The voting powers, designations, preferences and relative, participating, optional or other special rights and such qualifications, limitations or restrictions of the Common Stock, in addition to those set forth elsewhere herein, are as follows: |
| (i) | Preemptive Right. No shareholders of the Corporation holding Common Stock shall have any preemptive or other right to subscribe for any additional unissued or treasury shares of stock or for other securities of any class, or for rights, warrants or options to purchase stock, or for scrip, or for securities of any kind convertible into stock or carrying stock purchase warrants or privileges unless so authorized by the Corporation. |
| (ii) | Voting Rights and Powers. With respect to all matters upon which shareholders are entitled to vote or to which shareholders are entitled to give consent, the holders of the outstanding shares of the Common Stock shall be entitled to cast thereon one (1) vote in person or by proxy for each share of the Common Stock standing in his/her name. |
| (iii) | Dividends and Distributions. |
| (A) | Cash Dividends. Subject to the rights of holders of Preferred Stock, holders of Common Stock shall be entitled to receive such cash dividends as may be declared thereon by the Board from time to time out of assets of funds of the Corporation legally available therefore. |
| (B) | Other Dividends and Distributions. The Board may issue shares of the Common Stock in the form of a distribution or distributions pursuant to a stock dividend or split-up of the shares of the Common Stock. |
| (iv) | Other Rights. Except as otherwise required by the NRS and as may otherwise be provided in these Articles of Incorporation, each share of the Common Stock shall have identical powers, preferences and rights, including rights in liquidation. |
| (c) | Classes of Preferred Stock. The powers, preferences, rights, qualifications, limitations and restrictions pertaining to the Preferred Stock, or any series thereof, shall be such as may be fixed, from time to time, by the Board in its sole discretion, authority to do so being hereby expressly vested in the Board. The authority of the Board with respect to each such series of Preferred Stock will include, without limiting the generality of the foregoing, the determination of any or all of the following: |
| (i) | The number of shares of any series and the designation to distinguish the shares of such series from the shares of all other series; |
| (ii) | the voting powers, if any, of the shares of such series and whether such voting powers are full or limited; |
| (iii) | the redemption provisions, if any, applicable to such series, including the redemption price or prices to be paid; |
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| (iv) | whether dividends, if any, will be cumulative or noncumulative, the dividend rate or rates of such series and the dates and preferences of dividends on such series; |
| (v) | the rights of such series upon the voluntary or involuntary dissolution of, or upon any distribution of the assets of, the Corporation; |
| (vi) | the provisions, if any, pursuant to which the shares of such series are convertible into, or exchangeable for, shares of any other class or classes or of any other series of the same or any other class or classes of stock, or any other security, of the Corporation or any other corporation or other entity, and the rates or other determinants of conversion or exchange applicable thereto; |
| (vii) | the right, if any, to subscribe for or to purchase any securities of the Corporation or any other corporation or other entity; |
| (viii) | the provisions, if any, of a sinking fund applicable to such series; and |
| (ix) | any other relative, participating, optional or other powers, preferences or rights, and any qualifications, limitations or restrictions thereof, of such series. |
| (d) | Issuance of the Common Stock and the Preferred Stock. The Board may from time to time authorize by resolution the issuance of any or all shares of the Common Stock and the Preferred Stock herein authorized in accordance with the terms and conditions set forth in these Articles of Incorporation for such purposes, in such amounts, to such persons, corporations, or entities, for such consideration and in the case of the Preferred Stock, in one or more series, all as the Board in its discretion may determine and without any vote or other action by the shareholders, except as otherwise required by law. The Board, from time to time, also may authorize, by resolution, options, warrants and other rights convertible into Common or Preferred stock (collectively “securities”). The securities must be issued for such consideration, including cash, property, or services, as the Board may deem appropriate, subject to the requirement that the value of such consideration be no less than the par value of the shares issued. Any shares issued for which the consideration so fixed has been paid or delivered shall be fully paid stock and the holder of such shares shall not be liable for any further call or assessment or any other payment thereon, provided that the actual value of such consideration is not less that the par value of the shares so issued. The Board may issue shares of the Common Stock in the form of a distribution or distributions pursuant to a stock dividend or split-up of the shares of the Common Stock only to the then holders of the outstanding shares of the Common Stock. |
| (e) | Cumulative Voting. Except as otherwise required by applicable law, there shall be no cumulative voting on any matter brought to a vote of shareholders of the Corporation. During such time or times that applicable law requires cumulative voting, each shareholder entitled to vote at an election for directors may accumulate such shareholder’s votes and give one candidate a number of votes equal to the number of directors to be elected multiplied by the number of votes to which such shareholder’s shares are otherwise entitled, or distribute the shareholder’s votes on the same principle among as many candidates as such shareholder thinks fit. No shareholder comma however comma shall be entitled to cumulate such shareholders votes unless (a) the names of such candidate or candidates have been places in nomination prior to the voting and (b) the shareholder has given notice at the meeting, prior to the voting, of such shareholder’s intention to cumulate such shareholder’s votes. If any shareholder has given proper notice to cumulate votes, all shareholders may cumulate their votes for any candidates who have been probably placed in nomination. Under cumulative voting, the candidates receiving the highest number of votes, up to the number of directors to be elected, are elected. |
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| (f) | One Class. Except as otherwise required by the NRS, these Articles of Incorporation, or any designation for a class of Preferred Stock (which may provide that an alternate vote is required), (i) all shares of capital stock of the Corporation shall vote together as one class on all mattes submitted to a vote of the shareholders of the Corporation; and (ii) the affirmative vote of a majority of the voting power of all outstanding shares of voting stock entitled to vote in connection with the applicable matter shall be required for approval of such matter. |
| (g) | Section 78.2055 Election. Pursuant to the provisions of Subsection 3 of Section 78.2055 of the NRS, except as specifically set forth in any designation for a class of Preferred Stock, in the event that the Corporation desires to decrease the number of issued and outstanding shares of a class or series held by each shareholder of record at the effective date and time of the change without correspondingly decreasing the number of authorized shares of the same class or series which such decrease would adversely alter or change any preference, or any relative or other right given to any other class or series of outstanding shares, the holders of shares representing a majority of the voting power of each class or series whose preference or rights are adversely affected by the decrease are specifically denied the right to vote on such a decrease as a class or series. |
| (h) | Section 78.207 Election. Pursuant to the provisions of Subsection 3 of Section 78.207 of the NRS, except as specifically set forth in any designation for a class of Preferred Stock, in the event that the Corporation desires to change the number of shares of a class or series, if any, of its authorized stock by increasing or decreasing the number of authorized shares of the class or series and correspondingly increasing or decreasing the number of issued and outstanding shares of the same class or series held by each shareholder of record at the effective date and time of the change which increase or decrease would adversely alter or change any preference, or any relative or other right given to any other class or series of outstanding shares, the holders of shares representing a majority of the voting power of each class or series whose preference or rights are adversely affected by the decrease are specifically denied the right to vote on such increase or decrease as a class or series. |
| (i) | Section 78.390 Election. Pursuant to the provisions of Subsection 2 of Section 78.390 of the NRS, except as specifically set forth in any designation for a class of Preferred Stock, the holders of each class of stock of the Corporation are specifically denied the right to vote as a separate class on any proposed amendment to these Articles of Incorporation that would adversely alter or change any preference or any relative or other right given to any class or series of outstanding shares. |
| (j) | Clarification. None of the provisions herein, including, without limitation, the provisions of Section 4(f), Section 4(g), Section 4(h) or Section 4(i), shall otherwise affect or limit the power of the Board to change the number of shares of a class or series of authorized stock by increasing or decreasing the number of authorized shares of the class or series and correspondingly increasing or decreasing the number of issued and outstanding shares of the same class or series held by each shareholder without a vote of the shareholders, as set forth in Section 78.207 of the NRS, except as specifically set forth in any designation for a class of Preferred Stock. |
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Section 5. Adoption of Bylaws. In the furtherance and not in limitation of the powers conferred by statute and subject to Section 6, the Board is expressly authorized to adopt, repeal, rescind, alter or amend in any respect the bylaws of the Corporation (the “Bylaws”).
Section 6. Shareholder Amendment of Bylaws. Notwithstanding Section 5, the Bylaws may also be adopted, repealed, rescinded, altered or amended in any respect by the shareholders of the Corporation, but only by the affirmative vote of the holders of at least a majority of the voting power of all the then-outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors, voting together as a single voting class.
Section 7. Board of Directors. The business and affairs of the Corporation shall be managed by and under the direction of the Board. The first Board shall initially consist of five (5) persons. The initial directors of the Corporation shall be Michael Farkas, Daniel Arbour, Jack Leibler, Bennet Kurtz and Sean Oppen, and the mailing address of each of the foregoing is c/o NextNRG, Inc., 407 Lincoln Rd. #9F, Miami Beach, Florida 33190. Except as may otherwise be provided in connection with rights to elect additional directors under specified circumstances, which may be granted to the holders of any class or series of Preferred Stock, the number of directors of the Corporation may be amended from time to time as set forth in the Bylaws. The exact number of directors shall be fixed from time to time by the Board pursuant to resolution adopted by a majority of the full Board. Directors need not be shareholders.
Section 8. Powers of Board.
| (a) | In furtherance and not in limitation of the powers conferred by the laws of the NRS, the Board is expressly authorized and empowered: |
| (i) | To make, alter, amend, and repeal the Bylaws; |
| (ii) | Subject to the applicable provisions of the Bylaws then in effect, to determine, from time to time, whether and to what extent, and at what times and places, and under what conditions and regulations, the accounts and books of the Corporation, or any of them, shall be open to shareholder inspection, provided that no shareholder shall have any right to inspect any of the accounts, books or documents of the Corporation, except as permitted by law, unless and until authorized to do so by resolution of the Board or of the shareholders of the Corporation; |
| (iii) | To authorize and issue, without shareholder consent, obligations of the Corporation, secured and unsecured, under such terms and conditions as the Board, in its sole discretion, may determine, and to pledge or mortgage, as security therefore, any real or personal property of the Corporation, including after-acquired property; |
| (iv) | To determine whether any and, if so, what part of the earned surplus of the Corporation shall be paid in dividends to the shareholders, and to direct and determine other use and disposition of any such earned surplus; |
| (v) | To fix, from time to time, the amount of the profits of the Corporation to be reserved as working capital or for any other lawful purpose; |
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| (vi) | To establish bonus, profit-sharing, stock option, or other types of incentive compensation plans for the employees, including officers and directors, of the Corporation, and to fix the amount of profits to be shared or distributed, and to determine the persons to participate in any such plans and the amount of their respective participations; |
| (vii) | to designate, by resolution or resolutions passed by a majority of the whole Board, one or more committees, each consisting of two or more directors, which, to the extent permitted by law and authorized by the resolution or the Bylaws, shall have and may exercise the powers of the Board; and |
| (viii) | To provide for the reasonable compensation of its own members by Bylaw, and to fix the terms and conditions upon which such compensation will be paid. |
| (b) | In addition to the powers and authority hereinbefore, or by statute, expressly conferred upon it, the Board may exercise all such powers and do all such acts and things as may be exercised or done by the Corporation, subject, nevertheless, to the provisions of the laws of the State of Nevada, of these Articles of Incorporation, and of the Bylaws of the Corporation. |
Section 9. Interested Directors. No contract or transaction between this Corporation and any of its directors, or between this Corporation and any other corporation, firm, association, or other legal entity shall be invalidated by reason of the fact that the director of the Corporation has a direct or indirect interest, pecuniary or otherwise, in such corporation, firm, association, or legal entity, or because the interested director was present at the meeting of the Board which acted upon or in reference to such contract or transaction, or because he participated in such action, provided that: (1) the interest of each such director shall have been disclosed to or known by the Board and a disinterested majority of the Board shall have, nonetheless, ratified and approved such contract or transaction (such interested director or directors may be counted in determining whether a quorum is present for the meeting at which such ratification or approval is given); or (2) the conditions of Section 78.140 of the NRS are met.
Section 10. Term of Board of Directors. Except as otherwise required by applicable law, each director shall serve for a term ending on first anniversary of their date of election, provided that, notwithstanding the foregoing provisions of this Section 10 each director shall serve until their successor is elected and qualified or until his death, resignation or removal. All directors shall have equal standing. Notwithstanding the foregoing provisions of this Section 10, no decrease in the authorized number of directors shall shorten the term of any incumbent director; and additional directors, elected in connection with rights to elect such additional directors under specified circumstances, which may be granted to the holders of any class or series of Preferred Stock, shall not be included in any class, but shall serve for such term or terms and pursuant to such other provisions as are specified in the resolution of the Board establishing such class or series.
Section 11. Vacancies on Board of Directors. Except as may otherwise be provided in connection with rights to elect additional directors under specified circumstances, which may be granted to the holders of any class or series of Preferred Stock, newly created directorships resulting from any increase in the number of directors, or any vacancies on the Board resulting from death, resignation, removal, or other causes, shall, unless the Board determines by resolution that any such vacancies or newly created directorships shall be filled by the shareholders and except as otherwise provided by applicable law, be filled only by the affirmative vote of a majority of the directors then in office, even though less than a quorum of the Board, and not by the shareholders. Any director elected in accordance with the preceding sentence shall hold office for the remainder of the full term of director for which the vacancy was created or occurred and until such director’s successor shall have been elected and qualified or until such director’s death, resignation or removal, whichever first occurs.
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Section 12. Removal of Directors. Subject to any limitations imposed by applicable law, removal of directors shall be as provided in Section 78.335 of the NRS.
Section 13. Shareholder Action. Any action required or permitted to be taken by the stockholders of the Corporation must be effective at a duly called annual meeting or at a special meeting of stockholders of the Corporation, unless such action requiring or permitting stockholder approval is approved by a majority of the directors, in which case such action may be authorized or taken by the written consent of the holders of outstanding shares of voting stock having not less than the minimum voting power that would be necessary to authorize or take such action at a meeting of stockholders at which all shares entitled to vote thereon were present and voted, provided all other requirements of applicable law and these Articles of Incorporation have been satisfied.
Section 14. Special Shareholder Meetings. Special meetings of the shareholders of the Corporation for any purpose or purposes may be called at any time by a majority of the Board. Special meetings may not be called by any other person or persons. Each special meeting shall be held at such date and time as is requested by Board, within the limits fixed by law.
Section 15. Location of Shareholder Meetings. Meetings of shareholders of the Corporation may be held within or without the State of Nevada, as the Bylaws may provide. The books of the Corporation may be kept (subject to any provision of the NRS) outside the State of Nevada at such place or places as may be designated from time to time by the Board or in the Bylaws.
Section 16. Private Property of Shareholders. The private property of the shareholders shall not be subject to the payment of corporate debts to any extent whatever and the shareholders shall not be personally liable for the payment of the Corporation’s debts.
Section 17. Amendments.
| (a) | The Corporation reserves the right to adopt, repeal, rescind, alter or amend in any respect any provision contained in these Articles of Incorporation in the manner now or hereafter prescribed by applicable law and all rights conferred on shareholders herein granted subject to this reservation |
| (b) | Notwithstanding any other provision of these Articles of Incorporation or Any provision of law which might otherwise permit a lesser vote or no vote, but in addition to any affirmative vote of the holders of any particular class or series of the Corporation required by law or these Articles of Incorporation or any certificate of designations filed with respect to a series of Preferred Stock, the affirmative vote of holders of at least sixty-six and two-thirds percent (66 2/3%) of the voting power of all of the then-outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class, shall be required to alter, amend or repeal this Section 17, Section 19, Section 20 or Section 21. |
Section 18. Term of Existence. The Corporation is to have perpetual existence.
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Section 19. Liability of Directors. No director of this Corporation shall have personal liability to the Corporation or any of its shareholders for monetary damages for breach of fiduciary duty as a director or officers involving any act or omission of any such director or officer to the fullest extent under applicable law. The foregoing provision shall not eliminate or limit the liability of a director (i) for any breach of the director’s duty of loyalty to the Corporation or its shareholders, (ii) for acts or omissions not in good faith or, which involve intentional misconduct or a knowing violation of law, (iii) under applicable sections of the NRS, (iv) the payment of dividends in violation of the NRS or, (v) for any transaction from which the director derived an improper personal benefit. Any repeal or modification of this Section 19 by the shareholders of the Corporation shall be prospective only and shall not adversely affect any limitation on the personal liability of a director or officer of the Corporation for acts or omissions prior to such repeal or modification. Section 20. Indemnification.
| (a) | Indemnification in Actions, Suits or Proceedings other than Those by or in the Right of the Corporation. Subject to Section 20(c) and Section 20(j), the Corporation shall, to the fullest extent permitted by the NRS and applicable Nevada law as in effect at any time, indemnify, hold harmless and defend any person who: (i) was or is a director or officer of the Corporation or was or is a director or officer of a direct or indirect wholly owned subsidiary of the Corporation, and (ii) was or is a party or is threatened to be made a party to, or was or is otherwise directly involved in (including as a witness), any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Corporation) by reason of the fact that such person was or is a director or officer of the Corporation or any direct or indirect wholly owned subsidiary of the Corporation, or was or is serving at the request of the Corporation as a director, officer, employee, partner, member or agent of another corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise, whether the basis of such proceeding is alleged action in an official capacity or in any other capacity, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe such person’s conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea or nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which such person reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that such person’s conduct was unlawful. |
| (b) | Indemnification in Actions, Suits or Proceedings by or in the Right of the Corporation. Subject to Section 20(c) and Section 20(j), the Corporation shall indemnify, hold harmless and defend any person who: (i) was or is a director or officer of the Corporation or was or is a director or officer of a direct or indirect wholly owned subsidiary of the Corporation, and (ii) was or is a party or is threatened to be made a party to, or was or is otherwise directly involved in (including as a witness), any threatened, pending or completed action or suit by or in the right of the Corporation to procure a judgment in its favor by reason of the fact that such person was or is a director or officer of the Corporation or any direct or indirect wholly owned subsidiary of the Corporation, or was or is serving at the request of the Corporation as a director, officer, employee, partner, member or agent of another corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise, and whether the basis of such action, suit or proceeding is alleged action in an official capacity or in any other capacity, against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with the defense or settlement of such action or suit if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the Corporation; except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the Corporation unless and only to the extent that the Courts in the State of Nevada or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court in the State of Nevada or such other court shall deem proper. |
| (c) | Authorization of Indemnification. Any indemnification or defense under this Section 20 (unless ordered by a court) shall be made by the Corporation only as authorized in the specific case upon a determination that indemnification of the director or officer is proper in the circumstances because such person has met the applicable standard of conduct set forth in Section 20(a) or Section 20(b), as the case may be. Such determination shall be made, with respect to a person who is a director or officer at the time of such determination,: (i) by directors constituting the Board Voting Majority and who are not parties to such action, suit or proceeding, even though less than a quorum, or (ii) by a committee of such directors designated by the Board Voting Majority, even though less than a quorum, or (iii) if there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion, or (iv) by the shareholders. Such determination shall be made, with respect to former directors and officers, by any person or persons having the authority to act on the matter on behalf of the Corporation. To the extent, however, that a present or former director or officer of the Corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding set forth in Section 20(a) or Section 20(b) or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith, without the necessity of authorization in the specific case. |
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| (d) | Good Faith Defined. For purposes of any determination under Section 20(c), a person shall be deemed to have acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the Corporation, or, with respect to any criminal action or proceeding, to have had no reasonable cause to believe such person’s conduct was unlawful, if such person’s action is based on good faith reliance on the records or books of account of the Corporation or another enterprise, or on information supplied to such person by the officers of the Corporation or another enterprise in the course of their duties, or on the advice of legal counsel for the Corporation or another enterprise or on information or records given or reports made to the Corporation or another enterprise by an independent certified public accountant or by an appraiser or other expert selected with reasonable care by the Corporation or another enterprise. The term “another enterprise” as used in this Section 20(d) shall mean any other corporation or any partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise of which such person was or is serving at the request of the Corporation as a director, officer, employee, partner, member or agent. The provisions of this Section 20(d) shall not be deemed to be exclusive or to limit in any way the circumstances in which a person may be deemed to have met the applicable standard of conduct set forth in Section 20(a) or Section 20(b), as the case may be. |
| (e) | Expenses Payable in Advance. Expenses, including attorneys’ fees, incurred by a current or former director or officer in defending any action, suit or proceeding described in Section 20(a) or Section 20(b) shall be paid by the Corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or officer to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by the Corporation as authorized in this Section 20. |
| (f) | Non-exclusivity of Indemnification and Advancement of Expenses. The indemnification, defense and advancement of expenses provided by or granted pursuant to this Section 20 shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under these Articles of Incorporation, any agreement, vote of shareholders or disinterested directors or otherwise, both as to action in such person’s official capacity and as to action in another capacity while holding such office, it being the policy of the Corporation that indemnification of the persons specified in Section 20(a) or Section 20(b) shall be made to the fullest extent permitted by applicable law. The provisions of this Section 20 shall not be deemed to preclude the indemnification of, or advancement of expenses to, any person who is not specified in Section 20(a) or Section 20(b) but whom the Corporation has the power or obligation to indemnify under the provisions of the NRS or otherwise. |
| (g) | Insurance. The Corporation may purchase and maintain insurance on behalf of any person who was or is a director, officer, employee or agent of the Corporation, or a direct or indirect wholly owned subsidiary of the Corporation, or was or is serving at the request of the Corporation, as a director, officer, employee, partner, member or agent of another corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of such person’s status as such, whether or not the Corporation would have the power or the obligation to indemnify, hold harmless or defend such person against such liability under the provisions of this Section 20. |
| (h) | Certain Definitions. For purposes of this Section 20 references to the “Corporation” shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, employees or agents so that any person who was or is a director, officer, employee or agent of such constituent corporation, or was or is serving at the request of such constituent corporation as a director, officer, employee, partner, member or agent of another corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise, shall stand in the same position under the provisions of this Section 20 with respect to the resulting or surviving corporation as such person would have with respect to such constituent corporation if its separate existence had continued. For purposes of this Section 20, references to “fines” shall include any excise taxes assessed on a person with respect of any employee benefit plan; and references to “serving at the request of the Corporation” shall include any service as a director, officer, employee or agent of the Corporation which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner such person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the Corporation” as referred to in this Section 20. |
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| (i) | Survival of Indemnification and Advancement of Expenses. The indemnification, defense and advancement of expenses provided by, or granted pursuant to, this Section 20 shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director or officer and shall inure to the benefit of the heirs, executors and administrators of such a person. |
| (j) | Limitation on Indemnification. Notwithstanding anything contained in this Section 20 to the contrary, except for proceedings to enforce rights to indemnification and defense under this Section 20 (which shall be governed by Section 20(k)(ii)), the Corporation shall not be obligated under this Section 20 to indemnify, hold harmless or defend any director, officer, employee or agent in connection with a proceeding (or part thereof) initiated by such person unless such proceeding (or part thereof) was authorized by the Board. |
| (k) | Contract Rights. |
| (i) | The obligations of the Corporation under this Section 20 to indemnify, hold harmless and defend a person who was or is a director or officer of the Corporation or was or is a director or officer of a direct or indirect wholly owned subsidiary of the Corporation, including the duty to advance expenses, shall be considered a contract between the Corporation and such person, and no modification or repeal of any provision of this Section 20 shall affect, to the detriment of such person, such obligations of the Corporation in connection with a claim based on any act or failure to act occurring before such modification or repeal. |
| (ii) | If a claim under Section 20(a), Section 20(b) or Section 20(e) is not paid in full by the Corporation within 90 days after a written claim has been received by the Corporation, except in the case of a claim for an advancement of expenses, in which case the applicable period shall be 45 days, the person making such claim may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim. To the fullest extent permitted by applicable law, if successful in whole or in part in any such suit, or in a suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, such person shall be entitled to be paid also the expense of prosecuting or defending such suit. In (i) any suit brought by such person to enforce a right to indemnification hereunder (but not in a suit brought by such person to enforce a right to an advancement of expenses) it shall be a defense, and (ii) in any suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the Corporation shall be entitled to recover such expenses upon a final adjudication that such person has not met any applicable standard for indemnification set forth in the NRS. Neither the failure of the Corporation (including its directors who are not parties to such action, a committee of such directors, independent legal counsel or its Shareholders) to have made a determination prior to the commencement of such suit that indemnification of such person is proper in the circumstances because such person has met the applicable standard of conduct set forth in the NRS, nor an actual determination by the Corporation (including its directors who are not parties to such action, a committee of such directors, independent legal counsel or its Shareholders) that such person has not met such applicable standard of conduct, shall create a presumption that such person has not met the applicable standard of conduct or, in the case of such a suit brought by such person, be a defense to such suit. |
| (l) | Indemnification Agreements. Without limiting the generality of the foregoing, the Corporation shall have the express authority to enter into such agreements as the Board deems appropriate for the indemnification of present or future directors and officers of the Corporation in connection with their service to, or status with, the Corporation or any other corporation, entity or enterprise with whom such person is serving at the express written request of the Corporation. |
| (m) | Repeal or Amendment. Any repeal or modification of this Section 20 shall only be prospective and shall not affect the rights or protections or increase the liability of any director under this Section 20 in effect at the time of the alleged occurrence of any act or omission to act giving rise to liability or indemnification. |
Section 21. Forum Selection. Unless the Corporation consents in writing to the selection of an alternative forum, the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of the Corporation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of the Corporation to the Corporation or the Corporation’s shareholders, (iii) an action asserting a claim arising pursuant to any provision of the NRS, or (iv) any action asserting a claim governed by the internal affairs doctrine shall be a state or federal court located within the state of Nevada, in all cases subject to the court’s having personal jurisdiction over the indispensable parties named as defendants. Notwithstanding the foregoing, the exclusive forum provision will not apply to suits brought to enforce any liability or duty created by the Securities Exchange Act of 1934, as amended, the Securities Act of 1933, as amended, or any claim for which the federal courts have exclusive or concurrent jurisdiction.
Section 22. Headings. The headings contained herein are for convenience only, do not constitute a part of these Articles of Incorporation and shall not be deemed to limit or affect any of the provisions hereof.
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IN WITNESS WHEREOF, the undersigned has executed these Articles of Incorporation as of October 7, 2026.
| By: | /s/ Michael D. Farkas | |
| Michael D. Farkas | ||
| Sole Incorporator |
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Exhibit 3.2
Bylaws Of NextNRG, Inc.
a Nevada corporation
Adopted October 7, 2026
| 1. | Offices. NextNRG, Inc. (the “Corporation”) may have an office or offices, and keep the books and records of the Corporation, except as may otherwise be required by applicable law, at such other place or places, either within or without the State of Nevada, as the Board of Directors of the Corporation (then “Board”) may from time to time determine or the business of the Corporation may require. |
| 2. | Meetings of Shareholders. |
| 2.1. | Annual Meetings. The annual meetings of shareholders for the election of directors and for such other business as may be stated in the notice of the meeting shall be held at such time and date and place as the Board, by resolution, shall determine and as set forth in the notice of the meeting and shall be held at such place, either within or without the State of Nevada. If the date of the annual meeting shall fall upon a legal holiday, the meeting shall be held on the next succeeding business day. |
| 2.2. | Deferred Meeting for Election of Directors, etc. If the annual meeting of shareholders for the election of directors and the transaction of other business is not held within the time specified in Section 2.1, the Board shall call a special meeting of shareholders for the election of directors and the transaction of other business as soon thereafter as convenient. |
| 2.3. | Other Special Meetings. A special meeting of shareholders (other than a special meeting for the election of directors), unless otherwise prescribed by statute, may only be called by the Board and may be called at any time by the Board. At any special meeting of shareholders, only such business may be transacted as is related to the purpose(s) of such meeting set forth in the notice thereof given pursuant to Section 2.5 or in any waiver of notice thereof given pursuant to Section 2.6. |
| 2.4. | Fixing Record Date. |
| (a) | For the purpose of determining the shareholders entitled to notice of or to vote at any meeting of shareholders or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or for the purpose of determining shareholders entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock, or for the purpose of any other lawful action, the Board may fix, in advance, a date as of the record date for any such determination of shareholders. Such date shall not be more than sixty (60) nor less than ten (10) days before the date of such meeting nor more than sixty (60) days prior to any other action. If no such record date is fixed: |
| (i) | The record date for the determination of shareholders entitled to notice of or to vote at a meeting of shareholders shall be at the close of business on the day next preceding the day on which notice is given or, if no notice is given or if notice is waived, at the close of business on the day next preceding the day on which the meeting is held; |
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| (ii) | The record date for determining shareholders entitled to express consent to corporate action in writing without a meeting, when no prior action by the Board is necessary, shall be the day on which the first written consent is expressed; |
| (iii) | The record date for determining shareholders for any purpose other than those specified in Section 2.4(a)(i) and Section 2.4(a)(ii) shall be at the close of business on the day on which the Board adopts the resolution relating thereto. |
| (b) | When a determination of shareholders entitled to notice of, or to vote at, any meeting of shareholders has been made as provided in this Section 2.4, such determination shall apply to any adjournment thereof, unless the Board fixes a new record date for the adjourned meeting. |
| 2.5. | Notice of Meetings of Shareholders; Location. Except as otherwise provided in Section 2.4 and Section 2.6, whenever under any provision of the Nevada Revised Statutes (as the same may be amended and supplemented from time to time, and including any successor provision thereto, the “NRS”), the Articles of Incorporation of the Corporation (as the same may be amended, supplemented and/or restated from time to time, the “Articles”) or these Bylaws, shareholders are required or permitted to take any action at a meeting, written notice shall be given stating the place, date and hour of the meeting and, in the case of a special meeting, the purpose(s) for which the meeting is called. Except as otherwise provided by any provision of the NRS, a copy of the notice of any meeting shall be given, personally or by mail, not less than 10 nor more than 60 days before the date of the meeting, to each shareholder entitled to notice of, or to vote at, such meeting. If mailed, such notice shall be deemed to be given when deposited in the United States Mail, postage prepaid, directed to the shareholder at his address as it appears on the records of the Corporation. An affidavit of the Secretary or an Assistant Secretary or of the transfer agent of the Corporation that the notice required by this Section 2.5 has been given shall, in the absence of fraud, be prima facie evidence of the facts stated therein. When a meeting is adjourned to another time or place, notice need not be given of the adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken and, at the adjourned meeting, any business may be transacted that might have been transacted at the meeting originally called. If, however, the adjournment is for more than 60 days or if, after the adjournment, a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each shareholder of record entitled to vote at the meeting. The Board may designate the place of meeting for any meeting of Shareholders. If no designation is made by the Board, the place of meeting shall be the principal executive offices of the Corporation. The Board may, in its sole discretion, determine that the meeting shall not be held at any place, but may instead be held solely by means of remote communication as authorized by the NRS |
| 2.6. | Waivers of Notice. Whenever notice is required to be given to the shareholders under any provision of the NRS, or the Articles or these Bylaws, a written waiver thereof, signed by a shareholder entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a shareholder at a meeting shall constitute a waiver of notice of such meeting, except when the shareholder attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the shareholders need be specified in any written waiver of notice. |
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| 2.7. | Quorum of Shareholders; Adjournment; Postponement. The holders of a 33.33% of the voting power, present, in person or represented by proxy, shall be necessary and sufficient to constitute a quorum for the transaction of any business at such meeting, except where otherwise provided by any provision of the NRS. When a quorum is once present to organize a meeting of shareholders, it is not broken by the subsequent withdrawal of any shareholders. The Chairman, or the holders of a majority of the shares of stock present in person or represented by proxy at any meeting of shareholders, including an adjournment meeting, whether or not a quorum is present, may adjourn such meeting to another time and place. Any previously scheduled meeting of shareholders may be postponed, and any previously scheduled special meeting of Shareholders may be canceled, by the Board upon public notice given prior to the time previously scheduled for such meeting of shareholders. |
| 2.8. | Voting; Proxies. |
| (a) | Unless otherwise provided in the Articles, every shareholder of record shall be entitled at every meeting of shareholders to one vote for each share of capital stock standing in his name on the record of shareholders determined in accordance with Section 2.4. If the Articles provide for more or less than one vote for any share on any matter, every reference in these Bylaws or any provision of the NRS, to a majority or other proportion of stock shall refer to such majority to other proportion of the votes of such stock. The provisions of the NRS shall apply in determining whether any shares of capital stock may be voted and the persons, if any entitled to vote such shares, but the Corporation shall be protected in treating the persons in whose names shares of capital stock stand on the record of shareholders as owners thereof for all purposes. |
| (b) | The Board may, but need not, establish policies and procedures regarding the nomination, election and resignation of directors, which policies and procedures may: (i) include a condition to nomination by the Board for election or re-election as a director that an individual agree to tender, if elected or re-elected, an irrevocable offer of resignation conditioned on: (A) failing to receive the required vote for re-election at the next meeting at which such person would face re-election and (B) acceptance of the resignation by the Board, (ii) require: (A) if one exists, the Corporation’s nominating and governance committee or other committee designated by the Board (the “Nominating and Governance Committee”) to make a recommendation to the Board on whether to accept or reject the resignation, or whether other action should be taken and (B) the Board to act on the Nominating and Governance Committee’s recommendation and publicly disclose its decision and the rationale behind it within 90 days, to the extent practicable, from the date of the certification of the election results. |
| (c) | As to each matter submitted to a vote of the shareholders (other than the election of directors), except as otherwise provided by law or by the Articles or by these Bylaws, such matter shall be decided by a majority of the votes cast on such matter. |
| (d) | In voting on any other question on which a vote by ballot is required by law, the voting shall be by ballot. Each ballot shall be signed by the shareholder voting or by his proxy and shall state the number of shares voted. Every shareholder entitled to vote at a meeting of shareholders or to express consent or dissent to corporate action in writing without a meeting may authorize another person(s) to act for him by proxy. Any proxy to be used at a meeting of shareholders must be delivered to the Secretary of the Corporation or his or her representative at the principal executive offices of the Corporation at or before the time of the meeting. The validity and enforceability of any proxy shall be determined in accordance with the provisions of the NRS. The Chairman shall fix and announce at the meeting the date and time of the opening and the closing of the polls for each matter upon which the shareholders will vote at the meeting. |
| 2.9. | Nomination of Directors. Only persons who are nominated in accordance with the procedures set forth in these Bylaws shall be eligible for election as directors. Nominations of persons for election to the Board may be made at a meeting of shareholders at which directors are to be elected only (a) by or at the direction of the Board or (b) by any shareholder of the Corporation entitled to vote for the election of directors at a meeting who complies with the notice procedures set forth in Section 2.10. |
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| 2.10. | Notices of Business or Nominations for Director. |
| (a) | For director nominations or other business to be properly brought before an annual meeting of shareholders by a shareholder, a shareholder’s notice must include the following information and/or documents, as applicable: (A) the name and address of the shareholder giving the notice, as they appear on the Corporation’s books, and of the beneficial owner of stock of the Corporation, if any, on whose behalf such nomination or proposal of other business is made (such beneficial owner, the “Beneficial Owner”); (B) representations that, as of the date of delivery of such notice, such shareholder is a holder of record of stock of the Corporation and is entitled to vote at such meeting and intends to appear in person or by proxy at such meeting to propose and vote for such nomination and any such other business; (C) as to each person whom the shareholder proposes to nominate for election or re-election as a director (a “Shareholder Nominee”): (1) all information relating to such Shareholder Nominee that is required to be disclosed in solicitations of proxies for election of directors in an election contest, or is otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934 (as amended from time to time, the “Exchange Act”) or any successor provision thereto, including such Shareholder Nominee’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected and to being named in the Corporation’s proxy statement and form of proxy if the Corporation so determines, (2) a statement whether such Shareholder Nominee, if elected, intends to tender, promptly following such Shareholder Nominee’s election or re-election, an irrevocable offer of resignation effective upon such Shareholder Nominee’s failure to receive the required vote for re-election at the next meeting at which such Shareholder Nominee would face re-election and upon acceptance of such resignation by the Board; and (3) such other information as may be reasonably requested by the Corporation; (D) as to any other business that the shareholder proposes to bring before the meeting: (1) a brief description of such business, (2) the text of the proposal (including the text of any resolutions proposed for consideration and, if such business includes a proposal to amend these Bylaws, the text of the proposed amendment) and (3) the reasons for conducting such business at the meeting; and (E) in all cases: (1) the name of each individual, firm, corporation, limited liability company, partnership, trust or other entity (including any successor thereto, a “Person”) with whom the shareholder, any Beneficial Owner, any Shareholder Nominee and the respective affiliates and associates (as defined under Regulation 12B under the Exchange Act or any successor provision thereto) of such shareholder, Beneficial Owner and/or Shareholder Nominee (each of the foregoing, including, for the avoidance of doubt, the Shareholder, Beneficial Owner and/or Shareholder Nominee, a “Shareholder Group Member”) either is acting in concert with respect to the Corporation or has any agreement, arrangement or understanding (whether written or oral) for the purpose of acquiring, holding, voting (except pursuant to a revocable proxy given to such Person in response to a public proxy solicitation made generally by such Person to all holders of common stock of the Corporation) or disposing of any capital stock of the Corporation or to cooperate in obtaining, changing or influencing the control of the Corporation (except independent financial, legal and other advisors acting in the ordinary course of their respective businesses) (each Person described in this clause (1), including each Shareholder Group Member, a “Covered Person”), and a description, and, if in writing, a copy, of each such agreement, arrangement or understanding, (2) a list of the class, series and number of shares of capital stock of the Corporation that are beneficially owned or owned of record by each Covered Person, together with documentary evidence of such record or beneficial ownership, (3) a list of all derivative securities (as defined in Rule 16a-1 under the Exchange Act or any successor provision thereto) and other derivatives or similar arrangements to which any Covered Person is a counterparty and relating to any shares of capital stock of the Corporation, a description of all economic terms of all such derivative securities and other derivatives or similar arrangements and copies of all agreements and other documents relating to each of such derivative securities and other derivatives or similar arrangements, (4) a list of all transactions by any Covered Person involving any shares of capital stock of the Corporation or any derivative securities (as defined under Rule 16a-1 under the Exchange Act or any successor provision thereto) or other derivatives or similar arrangements related to any shares of capital stock of the Corporation entered into or consummated within 60 days prior to the date of such notice, (5) details of all other material interests of each Covered Person in such nomination or proposal or shares of capital stock of the Corporation (including any rights to dividends or performance-related fees based on any increase or decrease in the value of such shares of capital stock) and (6) a representation as to whether any Covered Person intends or is part of a group which intends to deliver a proxy statement and/or form of proxy to, in the case of a nomination or nominations, at least the percentage of the Corporation’s outstanding capital stock reasonably believed by the Covered Person to be sufficient to elect the nominee or nominees proposed to be nominated by the shareholder and, in the case of a proposal, holders of at least the percentage of the Corporation’s outstanding capital stock required to elect any Shareholder Nominee or approve such proposal (such representation, the “Solicitation Representation”). |
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| (b) | A notice delivered by or on behalf of any Shareholder under this Section 2.10 shall be deemed to be not in compliance with this Section 2.10 and not be effective if: (x) such notice does not include all of the information, documents and representations required under this Section 2.10, (y) after delivery of such notice, any information or document required to be included in such notice changes or is amended, modified or supplemented, as applicable, prior to the date of the relevant meeting and such information and/or document is not delivered to the Corporation by way of a further written notice as promptly as practicable following the event causing such change in information or amendment, modification or supplement, as applicable, and in any case where such event occurs within 45 days of the date of the relevant meeting, within five business days after such event or (z) any Covered Person does not act in accordance with the representation set forth in the Solicitation Representation; provided, however, that the Board shall have the authority to waive any such non-compliance if the Board determines that such action is appropriate in the exercise of its fiduciary duties. |
| (c) | Notwithstanding Section 2.10(b), in the event that the number of directors to be elected to the Board is increased effective at the next annual meeting and there is no Public Announcement (as defined below) specifying the size of the increased Board made by the Corporation at least 100 days prior to the first anniversary of the preceding year’s annual meeting, a shareholder’s notice required by this Section 2.10 shall also be considered timely, but only with respect to nominees for any new positions created by such increase, if it is delivered to the Secretary at the principal executive offices of the Corporation not later than the close of business on the 10th day following the day on which such Public Announcement is first made by the Corporation and such notice otherwise complies with the requirements of this Section 2.10. To be timely, a shareholder’s notice must be delivered to the Secretary at the principal executive offices of the Corporation not less than 90 days nor more than 120 days prior to the first anniversary of the preceding year’s annual meeting; provided, however, that in the event that the date of the annual meeting is advanced by more than 30 days, or delayed by more than 90 days, from such anniversary date, or if no annual meeting was held in the preceding year, notice by a shareholder to be timely must be so delivered not earlier than the 120th day prior to such annual meeting and not later than the close of business on the later of the 90th day prior to such annual meeting and the 10th day following the day on which the Public Announcement of the date of such meeting is first made by the Corporation. In no event shall the Public Announcement of an adjournment or postponement of an annual meeting commence a new time period for the giving of a Shareholder’s notice as described in this Section 2.10. |
| (d) | “Public Announcement” shall mean disclosure in a press release reported by the Dow Jones News Service, Associated Press or comparable national news service or in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Section 13, Section 14 or Section 15(d) of the Exchange Act or any document delivered to all Shareholders (including any quarterly income statement). |
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| 2.11. | Selection and Duties of Inspectors at Meeting of Shareholders. The Board, in advance of any meeting of shareholders, may appoint one or more inspectors to act at the meeting or any adjournment thereof. If inspectors are not so appointed, the person presiding at such meeting may and, on the request of any shareholder entitled to vote thereat shall, appoint one or more inspectors. In case any person appointed fails to appear or act, the vacancy may be filled by appointment made by the Board in advance of the meeting or at the meeting by the person presiding thereat. Each inspector, before entering upon the discharge of his duties, shall take and sign an oath faithfully to execute the duties of inspector at such meeting with strict impartiality and according to the best of his ability. The inspector(s) shall determine the number of shares outstanding and the voting power of each, the shares represented at the meeting, the existence of a quorum, the validity and effect of proxies, and shall receive votes, ballots or consents, hear and determine all challenges and questions arising in connection with the right to vote, count and tabulate all votes, ballots or consents, determine the result, and shall do such acts as are proper to conduct the election or vote with fairness to all shareholders. On the request of the person presiding at the meeting or any shareholder entitled to vote thereat, the inspector(s) shall make a report in writing of any challenge, question or matter determined by him or them and execute a certificate of any fact found by him or them. Any report or certificate made by the inspector(s) shall be prima facie evidence of the facts stated and of the vote as certified by him or them. |
| 2.12. | Organization. At every meeting of shareholders, the Chief Executive Officer or, in the absence of the Chief Executive Officer, a President or a Vice President, and in case more than one Vice President shall be present, that Vice President designated by the Board (or in the absence of any such designation, the most senior Vice President, based on age, present) shall act as chairman of the meeting. In case none of the officers above designated to act as chairman or secretary of the meeting, respectively, shall be present, a chairman or a secretary of the meeting, as the case may be, may be chosen by a majority of the voting power present at such meeting, which includes the voting power which is present in person or represented by proxy and entitled to vote at the meeting. |
| 2.13. | Order of Business. The order of business at all meetings of shareholders shall be as determined by the chairman of the meeting, but the order of business to be followed at any meeting at which a quorum is present may be changed by a majority of the votes cast at such meeting by the holders of shares of capital stock present, in person or represented by proxy and entitled to vote at the meeting. |
| 2.14. | Action Without Meeting. Unless otherwise provided by the Articles, any action required to be taken at any annual or special meeting of shareholders, or any action which may be taken at any annual or special meeting, may be taken without a meeting, without prior notice and without a vote if a consent in writing setting forth the action so taken is signed by the shareholders holding at least a majority of the voting power, except that if a different proportion of voting power is required for such action at a meeting, then that proportion of written consents is required. Every written consent shall bear the date of signature of each shareholder who signs the consent and no written consent shall be effective to take the corporate action referred to therein unless, within 60 days of the date the earliest dated consent is delivered to the Corporation, a written consent or consents signed by a sufficient number of holders to take action are delivered to the Corporation in the manner prescribed herein. An electronic transmission consenting to an action to be taken and transmitted by a shareholder or proxyholder, or by a person or persons authorized to act for a shareholder or proxyholder, shall be deemed to be written, signed and dated for the purposes of this Section 2.14 to the extent permitted by law. Any such consent shall be delivered in accordance with the NRS. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those shareholders who have not consented in writing or electronic transmission and who, if the action had been taken at a meeting, would have been entitled to notice of the meeting if the record date of such meeting had been the date that written consents signed by a sufficient number of shareholders or members to take the action were delivered to the Corporation as provided by law. |
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| 2.15. | Copies, Etc. Any copy, facsimile or other reliable reproduction of a consent in writing may be substituted or used in lieu of the original writing for any and all purposes for which the original writing could be used, provided that such copy, facsimile or other reproduction shall be a complete reproduction of the entire original writing |
| 3. | Directors. |
| 3.1. | Number and Term. Except as provided by any provision of the NRS, the number of directors shall be such number of persons as the majority of the full Board, by resolution, may from time to time determine. The directors shall, except for filling vacancies (whether resulting from an increase in the number of directors, resignations, removals or otherwise), be elected at the annual meeting of the shareholders and each director shall be elected to serve until his successor is elected and qualifies. Directors need not be shareholders. No decrease in the number of directors constituting the Board shall shorten the term of any incumbent director. The members of the Board shall elect a chairman of the Board (the “Chairman”) by a vote of a majority vote of all directors (which may include the vote of the person so elected). |
| 3.2. | Resignations. Any director, member of a committee or other officer may resign at any time. Such resignation shall be made in writing and shall take effect at the time specified therein and, if no time be specified, at the time of its receipt by the Chief Executive Officer or Secretary. The acceptance of a resignation shall not be necessary to make it effective. |
| 3.3. | Vacancies. Except as set forth in Section 3.4, if the office of any director, member of a committee or other officer becomes vacant (whether resulting from an increase in the number of directors, resignations, removals or otherwise), the remaining directors in office, though less than a quorum, by a majority vote, may appoint any qualified person to fill such vacancy, who shall hold office for the unexpired term and until his successor shall be duly chosen. |
| 3.4. | Removal. Directors may be removed and replaced pursuant to the procedures as set forth in the Articles and the NRS. |
| 3.5. | Increase or Decrease of Number. The number of directors may be increased or decreased only by the affirmative vote of a majority of the directors, though less than a quorum. Any newly created directorships may be filled in the same manner as a vacancy. |
| 3.6. | Powers. The business and affairs of the Corporation shall be managed by or under the direction of the Board, except as otherwise provided by applicable law or by the Articles. If any such provision is made in the Articles, the powers and duties imposed upon the Board by applicable law shall be exercised or performed to such extent and by such person or persons as shall be provided in the Articles. The Board shall exercise all of the powers of the Corporation except such as are by law, or by the Articles or by these Bylaws, conferred upon or reserved to the shareholders. |
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| 3.7. | Conference Call. Members of the Board or any committee designated by such Board may participate in a meeting of the Board or such committee by means of telephone conference or similar communication equipment by means of which all persons participating in the meeting can hear each other and participation pursuant to this Section 3.7 shall constitute presence at such meeting. |
| 3.8. | Committees. The Board may, by resolution(s) passed by a majority of the whole Board, designate one or more committees, each committee to consist of one (1) or more of the directors of the Corporation. The Board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of any member or such committee or committees, the member or members thereof present at any such meeting and not disqualified from voting, whether or not he or they constitute a quorum, may unanimously appoint another member of the Board to act at the meeting in the place of any such absent or disqualified member. Any such committee, to the extent provided in the resolution of the Board or in these Bylaws, shall have and may exercise all the powers and authority of the Board in the management of the business and affairs of the Corporation, but no such committee shall have the power or authority in reference to amending the Articles, adopting an agreement of merger or consolidation, recommending to the shareholders the sale, lease or exchange of all or substantially all of the Corporation’s property and assets, recommending to the shareholders a dissolution of the Corporation or a revocation of a dissolution, or amending these Bylaws of the Corporation and, unless the resolution, these Bylaws or the Articles expressly so provide, no such committee shall have the power or authority to declare a dividend or to authorize the issuance of stock. |
| 3.9. | Meetings. Meetings of the Board, regular or special, may be held at any place within or without the State of Nevada. |
| (a) | On the day when, and at the place where, the annual meeting of shareholders for the election of directors is held, and as soon as practicable thereafter, the Board may hold its annual meeting, without notice of such meeting, for the purposes or organization, election of officers and transaction of other business. The annual meeting of the Board may be held at any other time and place specified in a notice given as provided in this Section 3.9 for special meetings of the Board or in a waiver of notice thereof. |
| (b) | Regular meetings of the directors may be held without notice at such place and time as shall be determined from time to time by resolution of the directors. |
| (c) | Special meetings of the Board may be called by the Chief Executive Officer or by the Secretary on the written request of any two or more directors on at least ten (10) days’ notice to each director and shall be held at such place(s) as may be determined by the directors, or as shall be stated in the call of the meeting. |
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| (d) | Anything in these Bylaws or in any resolution adopted by the Board to the contrary notwithstanding, notice of any meeting of the Board need not be given to any director who submits a signed waiver of such notice, whether before or after such meeting, or who attends such meeting without protesting, prior thereto or at its commencement, the lack of notice to him. |
| 3.10. | Quorum. A majority of the directors in office from time to time shall constitute a quorum for the transaction of business. If at any meeting of the Board there shall be less than a quorum present, a majority of those present may adjourn the meeting from time to time until a quorum is obtained and no further notice thereof need be given, other than by announcement at the meeting which shall be so adjourned. |
| 3.11. | Compensation. Unless otherwise restricted by the Articles, the Board shall have the authority to fix the compensation of the directors. The directors may be paid their expenses, if any, of attendance at each meeting of the Board and may be paid a fixed sum for attendance at each meeting of the Board or paid a stated salary or paid other compensation as director. No such payment shall preclude any director from serving the Corporation in any other capacity and receiving compensation therefor. Members of special or standing committees may be allowed compensation for attending committee meetings. |
| 3.12. | Action Without Meeting. Any action required or permitted to be taken at any meeting of the Board, or of any committee thereof, may be taken without a meeting if a written consent thereto is signed by all members of the Board, or of such committee, as the case may be, and such written consent is filed with the minutes of proceedings of the Board or committee. |
| 3.13. | Telephone Meeting. Any one or more members of the Board or any committee thereof may participate in a meeting of the Board or such committee by means of a conference telephone or similar communications equipment allowing all persons participating in the meeting to hear each other at the same time. Participation by such means shall constitute presence in person at such meeting. |
| 3.14. | Annual Report. As soon as practicable after the close of each fiscal year, a report of the business and affairs of the Corporation to the shareholders shall be made under the direction of the Board, unless the Board determines, in its reasonable discretion, that such a report is not reasonably required. |
| 4. | Officers. |
| 4.1. | Officers. The Board may elect or appoint a Chief Executive Officer and such other officers as it may determine. The Board may designate one or more Vice Presidents as Executive Vice Presidents and may use descriptive words or phrases to designate the standing, seniority or area of special competence of the Vice Presidents elected or appointed by it. Each officer shall hold his office until his successor is elected and qualified or until his earlier death, resignation or removal in the manner provided in Section 4.2. Any two or more offices may be held by the same person. The Board may require any officer to give a bond or other security for the faithful performance of his duties, in such amount and with such sureties as the Board may determine. All officers as between themselves and the Corporation shall have such authority and perform such duties in the management of the Corporation as may be provided in these Bylaws or as the Board may from time to time determine. |
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| 4.2. | Removal of Officers. Any officer elected or appointed by the Board may be removed by the Board with or without cause. In addition, unless the Board specifically reserves to itself the sole power to remove any officer elected or appointed by the Board, then any officer elected or appointed by the Board may also be removed by the Chief Executive Officer, with or without cause. The removal of an officer without cause shall be without prejudice to his contract rights, if any. The election or appointment of an officer shall not of itself create contract rights. |
| 4.3. | Resignations. Any officer may resign at any time by notifying the Board, the Chief Executive Officer or the Secretary in writing. Such resignation shall take effect at the date of receipt of such notice or at such later time as is therein specified and, unless otherwise specified, the acceptance of such resignation shall not be necessary to make it effective. The resignation of an officer shall be without prejudice to the contract rights of the Corporation, if any. |
| 4.4. | Vacancies. A vacancy in any office because of death, resignation, removal, disqualification or any other cause shall be filled for the unexpired portion of the term in the manner prescribed in these Bylaws for the regular election or appointment to such office. |
| 4.5. | Compensation. Salaries or other compensation of the officers may be fixed from time to time by the Board. No officer shall be prevented from receiving a salary or other compensation by reason of the fact that he is also a director. |
| 4.6. | Chief Executive Officer. The Chief Executive Officer shall have general supervision and direction of the business and affairs of the Corporation, subject to control of the Board, and shall report directly to the Board, and shall have supervisory responsibility over officers operating and discharging their responsibilities. The Chief Executive Officer shall perform all such other duties which are commonly incident to the capacity of Chief Executive Officer or which are delegated to him or her by the Board. |
| 4.7. | President. The President shall have general supervision and direction of the business and affairs of the Corporation as directed by the Chief Executive Officer. The President shall, if present, preside at all meetings of the shareholders. He may, with the Secretary or the Treasurer or an Assistant Secretary or an Assistant Treasurer, sign certificates for shares of the Corporation. He may sign and execute, in the name of the Corporation, deeds, mortgages, bonds, contracts and other instruments, except in cases where the signing and execution thereof shall be expressly delegated by the Board or by these Bylaws to some other officer or agent of the Corporation, or shall be required by law otherwise to be signed or executed, and, in general, he shall perform all duties incident to the office of President and such other duties as from time to time may be assigned to him by the Board. If there is no President, the Chief Executive Officer shall perform the President’s functions. |
| 4.8. | Principal Financial Officer. The Principal Financial Officer shall perform all the powers and duties of the office of the principal financial officer and in general have overall supervision of the financial operations of the Corporation. The Principal Financial Officer shall, when requested, counsel with and advise the other officers of the Corporation and shall perform such other duties as he may agree with the Chief Executive Officer or as the Board may from time to time determine. If there is no Principal Financial Officer, the Chief Executive Officer shall perform the Principal Financial Officer’s functions. |
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| 4.9. | Executive Vice Presidents. At the request of the President or, in his absence, at the request of the Board, the Executive Vice Presidents shall (in such order as may be designated by the Board or, in the absence of any such designation, in order of seniority based on age) perform all of the duties of the President and, so acting, shall have all the powers of and be subject to all restrictions upon the President. Any Executive Vice President may also, with the Secretary or the Treasurer or an Assistant Secretary or an Assistant Treasurer, sign certificates for shares of the Corporation, may sign and execute in the name of the Corporation deeds, mortgages, bonds, contracts or other instruments authorized by the Board, except in cases where the signing and execution thereof shall be expressly delegated by the Board or by these Bylaws to some other officer or agent of the Corporation, or shall be required by law otherwise to be signed or executed, and shall perform such other duties as from time to time may be assigned to him by the Board or the President. |
| 4.10. | Secretary. The Secretary, if present, shall act as Secretary of all meetings of the shareholders and of the Board and shall keep the minutes thereof in the proper book(s) to be provided for that purpose; he shall see that all notices required to be given by the Corporation are duly given and served; he may, with the Chief Executive Officer or a Vice President, sign certificates for shares of the Corporation; he shall be custodian of the seal of the Corporation, if any, and may seal with the seal of the Corporation or a facsimile thereof, if any, all certificates for shares of capital stock of the Corporation and all documents; he shall have charge of the stock ledger and also of the other books, records and papers of the Corporation relating to its organization and management as a Corporation and shall see that the reports, statements and other documents required by law are properly kept and filed; and shall, in general, perform all duties incident to the office of Secretary and such other duties as from time to time may be assigned to him by the Board or the Chief Executive Officer. If there is no Secretary, the Chief Executive Officer shall perform the Secretary’s functions. |
| 4.11. | Treasurer. The Treasurer shall have charge and custody of, and be responsible for, all funds, securities and notes of the Corporation; receive and give receipts for monies due and payable to the Corporation from any sources whatsoever; deposit all such monies in the name of the Corporation in such banks, trust companies or other depositories as shall be selected in accordance with these Bylaws; against proper vouchers, cause such funds to be disbursed by checks or drafts on the authorized depositories of the Corporation signed in such manner as shall be determined in accordance with any provisions of these Bylaws, and be responsible for the accuracy of the amounts of all monies to disbursed; regularly enter or cause to be entered in books to be kept by him or under his direction full and adequate account of all monies received or paid by him for the account of the Corporation; have the right to require, from time to time, reports or statements giving such information as he may desire with respect to any and all financial transactions of the Corporation from the officers or agents transacting the same; render to the Chief Executive Officer or the Board, whenever the Chief Executive Officer or the Board, respectively, shall require him so to do, an account of the financial conditions of the Corporation and of all his transactions as Treasurer; exhibit at all reasonable times his books of account and other records to any of the directors upon application at the office of the Corporation where such books and records are kept; and, in general, perform all duties incident to the office of Treasurer and such other duties as from time to time may be assigned to him by the Chief Executive Officer or the Board; and he may sign with the Chief Executive Officer or a Vice President certificates for shares of the capital stock of the Corporation. If there is no Treasurer, the Chief Executive Officer shall perform the Treasurer’s functions. |
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| 4.12. | Assistant Secretaries and Assistant Treasurers. Assistant Secretaries and Assistant Treasurers shall perform such duties as shall be assigned to them by the Secretary or by the Treasurer, respectively, or by the Board or the Chief Executive Officer. Assistant Secretaries and Assistant Treasurers may, with the Chief Executive Officer or a Vice President, sign certificates for shares of the Corporation. |
| 4.13. | Additional Matters. The Chief Executive Officer, the President and the Principal Financial Officer of the Corporation shall have the authority to designate employees of the Corporation to have the title of Vice President, Assistant Vice President, Assistant Treasurer, Assistant Controller or Assistant Secretary. Any employee so designated shall have the powers and duties determined by the officer making such designation. The persons upon whom such titles are conferred shall not be deemed officers of the Corporation unless elected by the Board. |
| 5. | Contracts, Checks, Drafts, Bank Accounts, etc. |
| 5.1. | Execution of Contracts. The Board may authorize any officer, employee or agent, in the name and on behalf of the Corporation, to enter into any contract or execute and satisfy any instrument, and any such authority may be general or confined to specific instances, or otherwise limited. |
| 5.2. | Loans. The Chief Executive Officer or any other officer, employee or agent authorized by these Bylaws or by the Board may effect loans and advances at any time for the Corporation from any bank, trust company or other institutions or from any firm, corporation or individual and for such loans and advances may make, execute and deliver promissory notes, bonds or other certificates or evidence of indebtedness of the Corporation and, when authorized by the Board to do so, may pledge and hypothecate or transfer any securities or the property of the Corporation as security for any such loans or advances. Such authority conferred by the Board may be general or confined to specific instances or otherwise limited. |
| 5.3. | Checks, Drafts, etc. All checks, drafts and other orders for the payment of money out of the funds of the Corporation and all notes or other evidence of indebtedness of the Corporation shall be signed on behalf of the Corporation in such manner as shall from time to time be determined by resolution of the Board. |
| 5.4. | Deposits. The funds of the Corporation not otherwise employed shall be deposited from time to time to the order of the Corporation in such banks, trust companies or other depositories as the Board may select or as may be selected by an officer, employee or agent of the Corporation to whom such power may from time to time be delegated by the Board. |
| 6. | Stocks and Dividends. |
| 6.1. | Certificates Representing Shares. The shares of the Corporation shall not be certificated unless required by law or as determined by the Board. |
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| 6.2. | Transfer of Shares. Transfers of shares of capital stock of the Corporation shall be made only on the books of the Corporation by the holder thereof or by his duly authorized attorney appointed by a power of attorney duly executed and filed with the Secretary or a transfer agent of the Corporation and on surrender of any certificate(s) representing such shares of capital stock, if they exist, properly endorsed for transfer and upon payment of all necessary transfer taxes and such other instruments of transfer as requested by the Corporation. A person in whose name shares of capital stock shall stand on the books of the Corporation shall be deemed the owner thereof to receive dividends, to vote as such owner and for all other purposes as respects the Corporation, its shareholders and creditors for any purpose, except to render the transferee liable for the debts of the Corporation to the extent provided by law, until such transfer shall have been entered on the books of the Corporation by an entry showing from and to whom transferred. |
| 6.3. | Registered Shareholders and Addresses of Shareholders. The Corporation shall be entitled to recognize the exclusive right of a person registered on its records as the owner of shares of capital stock to receive dividends and to vote as such owner, and shall not be bound to recognize any equitable or other claim to or interest in such share or shares of capital stock on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise provided by applicable law. Each shareholder shall designate to the Secretary or transfer agent of the Corporation an address at which notices of meetings and all other corporate notices may be given to such person, and, if any shareholder fails to designate such address, corporate notices may be given to such person by mail directed to such person at such person’s post office address, if any, as the same appears on the stock record books of the Corporation or at such person’s last known post office address or as otherwise provided by applicable law. |
| 6.4. | Transfer and Registry Agents. The Corporation may from time to time maintain one or more transfer offices or agents and registry offices or agents at such place(s) as may be determined from time to time by the Board. |
| 6.5. | Lost, Destroyed, Stolen and Mutilated Certificates. The holder of any shares shall immediately notify the Corporation of any loss, destruction, theft or mutilation of the certificate representing such shares and the Corporation may issue a new certificate to replace the certificate alleged to have been lost, destroyed, stolen or mutilated. The Board may, in its discretion, as a condition to the issue of any such new certificate, require the owner of the lost, destroyed, stolen or mutilated certificate, or his legal representatives, to make proof satisfactory to the Board of such loss, destruction, theft or mutilation and to advertise such fact in such manner as the Board may require, and to give the Corporation and its transfer agents and registrars, or such of them as the Board may require, a bond in such form, in such sums and with such surety or sureties as the Board may direct, to indemnify the Corporation and its transfer agents and registrars against any claim that may be made against any of them on account of the continued existence of any such certificate so alleged to have been lost, destroyed, stolen or mutilated and against any expense in connection with such claim. |
| 6.6. | Regulations. The Board may make rules and regulations as it may deem expedient, not inconsistent with these Bylaws or with the Articles, concerning the issue, transfer and registration of certificates representing shares of its capital stock. |
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| 6.7. | Restriction on Transfer of Stock. A written restriction on the transfer or registration of transfer of capital stock of the Corporation, if permitted by the provisions of the NRS, and noted conspicuously on the certificate representing such capital stock, if such certificate exists, may be enforced against the holder of the restricted capital stock of any successor or transferee of the holder including an executor, administrator, trustee, guardian or other fiduciary entrusted with like responsibility for the person or estate of the holder. Unless noted conspicuously on the certificate representing such capital stock, a restriction, even though permitted by the provisions of the NRS, as the same may be amended and supplements, shall be ineffective except against a person with actual knowledge of the restriction. A restriction on the transfer or registration of transfer of capital stock of the Corporation may be imposed either by the Articles or by an agreement among any number of shareholders or among such shareholders and the Corporation. No restriction so imposed shall be binding with respect to capital stock issued prior to the adoption of the restriction unless the holders of such capital stock are parties to an agreement or voted in favor of the restriction. Except to the extent that the Corporation has obtained an opinion of counsel acceptable to the Corporation that transfer restrictions are not required under applicable securities laws, or has otherwise satisfied itself that such transfer restrictions are not required, all certificates representing shares of the Corporation shall bear a legend on the face of the certificate, or on the reverse of the certificate if a reference to the legend is contained on the face, which reads substantially as follows: |
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR APPLICABLE STATE SECURITIES LAWS, AND NO INTEREST MAY BE SOLD, DISTRIBUTED, ASSIGNED, OFFERED, PLEDGED OR OTHERWISE TRANSFERRED UNLESS (A) THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS COVERING ANY SUCH TRANSACTION INVOLVING SAID SECURITIES, (B) THIS CORPORATION RECEIVES AN OPINION OF LEGAL COUNSEL FOR THE HOLDER OF THESE SECURITIES SATISFACTORY TO THIS CORPORATION STATING THAT SUCH TRANSACTION IS EXEMPT FROM REGISTRATION, OR (C) THIS CORPORATION OTHERWISE SATISFIES ITSELF THAT SUCH TRANSACTION IS EXEMPT FROM REGISTRATION.
| 6.8. | Dividends, Surplus, etc. Subject to the provisions of the Articles and of law, the Board: |
| (a) | may declare and pay dividends or make other distributions on the outstanding shares of capital stock in such amounts and at such time to times as, in its discretion, the conditions of the affairs of the Corporation shall render advisable; |
| (b) | may use and apply, in its discretion, any of the surplus of the Corporation in purchasing or acquiring any shares of capital stock of the Corporation, or purchase warrants therefor, in accordance with law, or any of its bonds, debentures, notes, scrip or other securities or evidence of indebtedness; and |
| (c) | may set aside from time to time out of such surplus or net profits such sum(s) as, in its discretion, it may think proper, as a reserve fund to meet contingencies, or for equalizing dividends or for the purpose of maintaining or increasing the property or business of the Corporation, or for any other purpose it may think conducive to the best interests of the Corporation. |
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| 7. | Miscellaneous. |
| 7.1. | Seal. The Board shall have the power by resolution to adopt, make and use a corporate seal and to alter the form of such seal from time to time. |
| 7.2. | Fiscal Year. The fiscal year of the Corporation shall be determined, and may be changed, by resolution of the Board. |
| 7.3. | Books and Records. The Corporation shall: (1) Keep as permanent records minutes of all meetings of its shareholders and the Board, a record of all actions taken by the shareholders or the Board without a meeting, and a record of all actions taken by a committee of the Board exercising the authority of the Board on behalf of the Corporation; (2) Maintain appropriate accounting records; (3) Maintain a record of its shareholders, in a form that permits preparation of a list of the names and addresses of all shareholders, in alphabetical order by class of shares showing the number and class of shares held by each; provided, however, such record may be maintained by an agent of the Corporation; (4) Maintain its records in written form or in another form capable of conversion into written form within a reasonable time; and (5) Keep a copy of the following records (subject to any provision of the NRS) outside the State of Nevada at such place or places as may be designated from time to time by the Board: (a) the Articles as currently in effect; (b) these Bylaws and all amendments thereto as currently in effect; (c) the minutes of all meetings of shareholders and records of all action taken by shareholders; (d) the Corporation’s financial statements for the past three years; (e) all written communications to shareholders generally within the past three years; (f) a list of the names and business addresses of the current Directors and officers; and (g) the most recent annual report delivered to the Nevada Secretary of State. |
| 7.4. | Attorneys’ Fees. If any action is brought by any party against another party, relating to or arising out of these Bylaws, or the enforcement hereof, the prevailing party shall be entitled to recover from the other party reasonable attorneys’ fees, costs and expenses incurred in connection with the prosecution or defense of such action. For purposes of these Bylaws, the term “attorneys’ fees” or “attorneys’ fees and costs” shall mean the fees and expenses of counsel to the Corporation and any other parties asserting a claim as set forth in this Section 7.4, which may include printing, photocopying, duplicating and other expenses, air freight charges, and fees billed for law clerks, paralegals and other persons not admitted to the bar but performing services under the supervision of an attorney, and the costs and fees incurred in connection with the enforcement or collection any judgment obtained in any such proceeding. The provisions of this Section 7.4 shall survive the entry of any judgment, and shall not merge, or be deemed to have merged, into any judgment. |
| 7.5. | Subject to Law and Articles of Incorporation. All powers, duties and responsibilities provided for in these Bylaws, whether or not explicitly so qualified, are qualified by the provisions of the Articles and applicable law. |
| 7.6. | Facsimile Signatures. In addition to the provisions for use of facsimile signatures elsewhere specifically authorized in these Bylaws, facsimile signatures of any officer or officers of the Corporation may be used at any time unless otherwise restricted by the Board or a committee thereof. |
| 7.7. | Time Periods. In applying any provision of these Bylaws which requires that an act be done or not be done a specified number of days prior to an event or that an act be done during a period of a specified number of days prior to an event, calendar days shall be used, the day of the doing of the act shall be excluded, and the day of the event shall be included. |
| 7.8. | Electronic Transmission. For purposes of these Bylaws, “electronic transmission” means any form of communication, not directly involving the physical transmission of paper, that creates a record that may be retained, retrieved, and reviewed by a recipient thereof, and that may be directly reproduced in paper form by such a recipient through an automated process. |
| 8. | Indemnification. The Corporation shall have the rights and obligations related to indemnification as set forth in the Articles. |
| 9. | Amendments. These Bylaws may be altered or repealed and Bylaws may be made pursuant to the provisions set forth in the Articles. |
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Exhibit 3.3
CERTIFICATE OF DESIGNATIONS OF PREFERENCES AND RIGHTS OF SERIES A
CONVERTIBLE PREFERRED STOCK
of
NextNRG, Inc.
a Nevada corporation
The undersigned Chief Executive Officer of NextNRG, Inc. (“Corporation”), a corporation organized and existing under the laws of the State of Nevada, does hereby certify that, pursuant to the authority contained in the Corporation’s Articles of Incorporation (“Articles”) and pursuant to Section 78.1955 of the Nevada Revised Statutes (“NRS”), and in accordance with the provisions of the resolution creating a series of the class of the Corporation’s authorized preferred stock designated as Series B Convertible Preferred Stock as follows:
FIRST: The Articles authorize the issuance by the Corporation of 500,000,000 shares of common stock, par value of $0.0001 per share (“Common Stock”) and 50,000,000 shares of preferred stock, par value of $0.0001 per share (“Preferred Stock”), and further, authorize the Board of Directors (“Board”) of the Corporation, by resolution or resolutions, at any time and from time to time, to divide and establish any or all of the unissued shares of Preferred Stock not then allocated to any series into one or more series and to designate the rights, preferences and limitations of each series.
SECOND: By unanimous written consent of the Board dated September 29, 2026, the Board designated 513,000 shares of the Preferred Stock as the Series A Convertible Preferred Stock, par value $0.0001 per share (“Series A Preferred Stock”), pursuant to a resolution providing that a series of preferred stock of the Corporation be and hereby is created and that the designation and number of shares thereof and the voting and other powers, preferences and relative, participating, optional or other rights of the shares of such Series A Preferred Stock, and the qualifications, limitations and restrictions thereof, are as follows:
SERIES A CONVERTIBLE PREFERRED STOCK
Section 1. Powers and Rights of Series A Convertible Preferred Stock. There is hereby designated a class of Preferred Stock of the Corporation as the Series A Convertible Preferred Stock, par value $0.0001 per share, of the Corporation (the “Series A Stock”). The number of shares, powers, terms, conditions, designations, preferences and privileges, relative, participating, optional and other special rights, and qualifications, limitations and restrictions, if any, of the Series A Stock shall be as set forth in this Certificate of Designations of Preferences and Rights of Series A Convertible Preferred Stock (this “Certificate of Designations”). For purposes hereon, a holder of a share or shares of Series A Stock, with respect to their rights as related to the Series A Stock, shall be referred to as a “Series A Holder”. The Corporation is the successor to NextNRG, Inc., a Delaware corporation (“Next-Delaware”), which converted to the Corporation as a Nevada corporation on October 6, 2026 and the Series A Stock is being issued to the Series A Holder in exchange for the Series A Convertible Preferred Stock of Next-Delaware, as designated in the State of Delaware on August 16, 2024 (the “Original Designation Date”), and issued to the original Series A Holder on August 16, 2024 (the “Original Issuance Date”).
Section 2. Number and Stated Value. The number of authorized shares of Series A Stock is 513,000 shares. Each share of Series A Stock shall have initially have a stated value of $10.00 (the “Stated Value”). The Stated Value shall be subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Series A Stock occurring following the Original Designation Date.
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Section 3. Dividends and Distributions.
| (a) | Series A Dividends. The Series A Stock shall accrue dividends at the rate of 10% per annum of the Stated Value, which shall be accrue on a quarterly basis per calendar quarter following the Original Issuance Date, being the date of the issuance of the shares of Series A Convertible Preferred Stock of Next-Delaware to the Series A Holder, for which the Series A Stock shall be issued in exchange (the “Series A Dividend”). The Series A Dividend shall be due and payable within five Business Days (as defined below) of the end of each such calendar quarter, and shall be payable to the Series A Holder thereof via the issuance to the Series A Holder of a number of shares of common stock, par value $0.0001 per share of the Corporation (the “Common Stock”) equal to (i) the amount of the Series A Dividend, divided by (ii) the Conversion Price (as defined below) as in effect on the last Business Day of the preceding calendar quarter, in each case rounded to the nearest whole share of Common Stock (such shares of Common Stock, the “Dividend Shares”). In the event that any Series A Dividend is not paid when otherwise due due to the limitations as set forth in this Certificate of Designations, such Series A Dividend shall accrue and the applicable Dividend Shares shall be issued when permissible pursuant to the provisions of this Certificate of Designations. The Series A Dividend shall accrue commencing on the Original Issuance Date with respect to the applicable Series A Stock and shall cease to accrue on conversion of the applicable shares of Series A Stock, and the Series A Dividend for any partial calendar quarter shall be appropriately pro-rated. For purposes herein, a “Business Day” shall mean any day on which commercial banks are generally open for business in the State of Nevada. |
| (b) | Participation. The Series A Stock shall not participate in any other dividends or distributions made with respect to the Common Stock. |
| (c) | Other Distributions. Other than as specifically set forth herein, including, without limitation, in Section 3(a) or Section 3(b), the Series A Stock is not entitled to receive any dividends or distributions due solely to its status as Series A Stock, and the Series A Stock shall not participate in any dividends, distributions or payments to the holders of any other classes of stock of the Corporation other than the Common Stock as set forth herein. |
Section 4. Conversion.
| (a) | General Provisions. Subject to the terms and conditions herein, a Series A Holder shall have the right at any time to convert the Series A Stock, and the Series A Stock shall be convertible, into shares of Common Stock as set forth herein (such shares of Common Stock being referred to as the “Conversion Shares”) as set forth herein (each, a “Conversion”). |
| (b) | Conversion Price. |
| (i) | For purposes herein, the “Conversion Price” means 800% of the Minimum Price, as defined in Rule 5635 of The Nasdaq Stock Market LLC Rules, as of the Original Issuance Date, subject to adjustment as set forth herein. |
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| (ii) | Each share of Series A Stock converted in a Conversion shall be convertible into a number of Conversion Shares equal to (1) the Stated Value; divided by (2) the then-applicable Conversion Price, in each case rounded to the nearest whole share of Common Stock, calculated collectively with respect to all shares of Series A Stock being converted pursuant to any Notice of Conversion. |
| (iii) | A Series A Holder shall elect a Conversion by delivering to the Corporation a notice of conversion in the form as attached hereto as Exhibit A (the “Notice of Conversion”) at any time. Together with the Notice of Conversion, the Series A Holder shall surrender any certificate or certificates for the Series A Stock being converted, duly endorsed. The calculation of Conversion Shares to be issued as set forth in the Notice of Conversion shall be subject to confirmation and approval of the Corporation. The Corporation shall, within three Business Days (as defined below) of receipt of a Notice of Conversion, issue to the applicable Series A Holder the number of Conversion Shares to which such Series A Holder shall be entitled. A Conversion shall be deemed to have been effected on the date the Notice of Conversion is submitted to the Corporation if delivered by facsimile, e-mail or other reasonable means of communication dispatched prior to 6:00 p.m., Eastern time, and provided that if the Notice of Conversion is not delivered by such time then the conversion date shall be the next Business Day and the Notice of Conversion shall be deemed automatically updated accordingly. |
| (c) | Concerning the Conversion Shares. The Conversion Shares and any Dividend Shares may not be sold or transferred unless: (i) such Conversion Shares or Dividend Shares are sold pursuant to an effective registration statement under the Securities Act of 1933, as amended (together with the rules and regulations thereunder, the “Securities Act”) or (ii) the Corporation and its transfer agent shall have been furnished with an opinion of counsel (which opinion shall be in form, substance and scope customary for opinions of counsel in comparable transactions) to the effect that the shares to be sold or transferred may be sold or transferred pursuant to an exemption from such registration (such as Rule 144 or a successor rule) (“Rule 144”); or (iii) such Conversion Shares or Dividend Shares are transferred to an “affiliate” (as defined in Rule 144) of the applicable Series A Holder who agrees to sell or otherwise transfer the shares only in accordance with this section and who is an accredited investor (as defined in Rule 501 under Regulation D promulgated pursuant to the Securities Act). Any restrictive legend on any certificates representing the Conversion Shares or any Dividend Shares shall be removed and the Corporation shall issue to the applicable Series A Holder a new certificate therefore free of any transfer legend if the Corporation or its transfer agent shall have received an opinion of counsel from applicable Series A Holder’s counsel, in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect that (i) a public sale or transfer of such Conversion Shares or Dividend Shares may be made without registration under the Securities Act, which opinion shall be accepted by the Corporation so that the sale or transfer is effected; or (ii) in the case of Conversion Shares or Dividend Shares such security is registered for sale by the applicable Series A Holder under an effective registration statement filed under the Securities Act; or otherwise may be sold pursuant to an exemption from registration. |
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| (d) | Adjustment Due to Merger, Consolidation, Etc. If, at any time when the Series A Stock is issued and outstanding and prior to conversion of the applicable share(s) of Series A Stock, the Common Stock is converted into another class of securities of the Corporation or any successor entity to the Corporation, whether by way of merger, reorganization, re-incorporation or otherwise (the “Replacement Securities”), any reference herein to the Common Stock (whether standing alone or as part of another defined term herein) automatically upon the consummation of the applicable transaction shall be deemed a reference to such Replacement Securities. In the event that the Corporation completes a share exchange with another entity wherein all of the issued and outstanding shares of Common Stock are exchanged for equity interests in the other entity (the “Exchanged Securities”), any reference herein to the Common Stock (whether standing alone or as part of another defined term herein) automatically upon the consummation of the applicable transaction shall be deemed a reference to such Exchanged Securities. The adjustments in this Section 4(d) shall be undertaken each time any such event occurs. |
| (e) | Adjustment to Conversion Price Due to Splits. Without limiting any provision herewith, if the Corporation at any time on or after the Original Designation Date subdivides (by any stock split, stock dividend, stock combination, recapitalization or other similar transaction) the outstanding shares of Common Stock into a greater number of shares, the Conversion Price in effect immediately prior to such subdivision will be proportionately increased. Without limiting any provision herewith, if the Corporation at any time on or after the Original Designation Date (by any stock split, stock dividend, stock combination, recapitalization or other similar transaction) combines the outstanding shares of Common Stock into a smaller number of shares, the Conversion Price in effect immediately prior to such combination will be proportionately decreased. By way of example and not limitation, in the event of a two-for-one forward split of the Common Stock, whereby each share of Common Stock is converted into two shares of Common Stock, the Conversion Price shall be decreased by 50% and, in the event of a one-for-two reverse split of the Common Stock, whereby each two shares of Common Stock are converted into one share of Common Stock, the Conversion Price shall be increased by 100%. Any adjustment pursuant to this Section 4(e) shall become effective immediately after the effective date of such subdivision or combination. |
| (f) | Additional Provisions. |
| (i) | No fractional shares or scrip representing fractional shares of Common Stock shall be issued upon the Conversion of the Series A Stock or with respect to any issuance of any Dividend Shares. As to any fraction of a share of Common Stock which the Series A Holder would otherwise be entitled to acquire upon such Conversion or upon payment of any Series A Dividend, the Corporation 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 fair market value of a share of Common Stock as determined in good faith by the Board of Directors of the Corporation, or round up to the next whole share of Common Stock. |
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| (ii) | The issuance of Conversion Shares or Dividend Shares shall be made without charge to any Series A Holder for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such Conversion Shares or Dividend Shares, provided that the Corporation shall not be required to pay any tax that may be payable in respect of any transfer involved in the issuance and delivery of any such Conversion Shares or Dividend Shares in a name other than that of the Series A Holders of such shares of Series A Stock and the Corporation shall not be required to issue or deliver such Conversion Shares or Dividend Shares unless or until the Person (as defined below) or Persons requesting the issuance thereof shall have paid to the Corporation the amount of such tax or shall have established to the satisfaction of the Corporation that such tax has been paid. For purposes hereof, “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. |
| (iii) | The Corporation covenants that during the period the Conversion right exists, the Corporation will reserve from its authorized and unissued Common Stock a number of shares of Common Stock equal to at least 100% of the number of Conversion Shares then issuable on conversion of all shares of Series A Stock, free from preemptive rights, to provide for the issuance of Conversion Shares upon the full conversion of the Series A Stock issued and outstanding. |
| (g) | Beneficial Ownership Limitation. Notwithstanding anything herein to the contrary, in no event shall any Series A Holder be entitled to elect to complete any Conversion, and such Series A Holder shall not have any right to be issued any Dividend Shares, to the extent that following such Conversion or issuance of Dividend Shares, the sum of (1) the number of shares of Common Stock beneficially owned by such Series A Holder and its affiliates (other than shares of Common Stock which may be deemed beneficially owned through the ownership of the unconverted/un-redeemed portion of the Series A Stock or the unexercised or unconverted portion of any other security of the Corporation subject to a limitation on conversion, issuance or exercise analogous to the limitations contained herein) and (2) the number of shares of Common Stock issuable upon the conversion or redemption of the portion of the Series A Stock with respect to which the determination of this proviso is being made, would result in beneficial ownership by such Series A Holder and its affiliates of more than 9.99% of the outstanding shares of Common Stock. For purposes of the proviso to the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Regulations 13D-G thereunder, except as otherwise provided in clause (1) of such proviso, provided, further, however, that the limitations on conversion or redemption as set forth herein may be waived or increased by the applicable Series A Holder upon, at the election of the applicable Series A Holder, not less than 61 days’ prior notice to the Corporation, and the provisions of the conversion or redemption limitation shall continue to apply until such 61st day (or such later date, as determined by the applicable Series A Holder, as may be specified in such notice of waiver). |
Section 5. Vote. Other than as set forth in Section 6, each share of Series A Stock shall, on any matter submitted to the holders of the Common Stock, or any class thereof, for a vote, vote together with the Common Stock, or any class thereof, as applicable, as one class on such matter for as long as the share of Series A Stock is issued and outstanding and each share of Series A Stock shall have a number of votes on such matter equal to the number of Conversion Shares which would be issuable with respect to such Series A Stock as of the date of such vote, and, for purposes of this Section 5, provided, that, for purposes of this Section 5, the “Conversion Price” used for the determination of the number of Conversion Shares which would be issuable with respect to such Series A Stock shall be the Minimum Price, as defined in Rule 5635 of The Nasdaq Stock Market LLC Rules, as of the date of issuance of the shares of Series A Stock.
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Section 6. Amendment and Protective Provisions. The Corporation may not, and shall not, amend or repeal this Certificate of Designations without the prior written consent of Series A Holders holding a majority of the Series A Stock then issued and outstanding, in which vote each share of Series A Stock then issued and outstanding shall have one vote, voting separately as a single class, in person or by proxy, either in writing without a meeting or at an annual or a special meeting of such Series A Holders, or in a written consent executed by Series A Holders holding a majority of the issued and outstanding shares of Series A Stock, and any such act or transaction entered into without such vote or consent shall be null and void ab initio, and of no force or effect.
Section 7. Miscellaneous.
| (a) | Legend. Any certificates representing the Series A Stock shall bear a restrictive legend in substantially the following form (and a stop transfer order may be placed against transfer of such stock certificates): |
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, NOR REGISTERED NOR QUALIFIED UNDER ANY STATE SECURITIES LAWS. SUCH SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, DELIVERED AFTER SALE, TRANSFERRED, PLEDGED, OR HYPOTHECATED UNLESS QUALIFIED AND REGISTERED UNDER APPLICABLE STATE AND FEDERAL SECURITIES LAWS OR UNLESS, IN THE OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY, SUCH QUALIFICATION AND REGISTRATION IS NOT REQUIRED. ANY TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS FURTHER SUBJECT TO OTHER RESTRICTIONS, TERMS AND CONDITIONS WHICH ARE SET FORTH HEREIN.
| (b) | Lost or Mutilated Series A Stock Certificate. If the certificate for the Series A Stock held by the Series A Holder thereof shall be mutilated, lost, stolen or destroyed, the Corporation shall execute and deliver, in exchange and substitution for and upon cancellation of a mutilated certificate, or in lieu of or in substitution for a lost, stolen or destroyed certificate, a new certificate for the share of Series A Stock so mutilated, lost, stolen or destroyed but only upon receipt of evidence of such loss, theft or destruction of such certificate, and of the ownership hereof, and indemnity, if requested, all reasonably satisfactory to the Corporation. |
| (c) | No Registration Rights. The Series A Holders shall not have the right to require the Corporation to register any shares of Series A Stock or any Conversion Shares for sale pursuant to the securities laws of the United States, except as may be separately agreed between a Series A Holder and the Corporation |
| (d) | Interpretation. If a Series A Holder shall commence an action or proceeding to enforce any provisions of this Certificate of Designations, 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 with the investigation, preparation and prosecution of such action or proceeding. |
| (e) | Waiver. Any waiver by the Corporation or the Series A Holder of a breach of any provision of this Certificate of Designations shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Certificate of Designations. The failure of the Corporation or the Series A Holder to insist upon strict adherence to any term of this Certificate of Designations on one or more occasions shall not be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Certificate of Designations. Any waiver must be in writing. |
Section 8. Severability. If any provision of this Certificate of Designations is invalid, illegal or unenforceable, the balance of this Certificate of Designations shall remain in effect, and if any provision is inapplicable to any person or circumstance, it shall nevertheless remain applicable to all other persons and circumstances. If it shall be found that any interest or other amount deemed interest due hereunder violates applicable laws governing usury, the applicable rate of interest due hereunder shall automatically be lowered to equal the maximum permitted rate of interest.
[Signature Page Follows]
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IN WITNESS WHEREOF, the undersigned has executed this Certificate of Designation on this 7th day of October, 2026.
| By: | /s/ Michael D. Farkas | |
| Name: | Michael D. Farkas | |
| Title: | Chief Executive Officer |
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EXHIBIT A
NextNRG, Inc.
Notice of Conversion
Reference is made to the Certificate of Designations of Preferences and Rights of Series A Convertible Preferred Stock of NextNRG, Inc. (the “Corporation”) dated as of October 7, 2026, designating the rights and preferences of the Series A Convertible Preferred Stock of the Corporation (the “Certificate of Designations”). In accordance with and pursuant to the Certificate of Designations, the undersigned hereby elects to convert the number of shares of Series A Convertible Preferred Stock, $0.0001 par value per share (the “Preferred Shares”), of the Corporation indicated below into shares of common stock, $0.0001 par value per share (the “Common Stock”), of the Corporation, as of the date specified below.
| Date of Conversion: | |||
| Number of Preferred Shares to be converted: | |||
| Tax ID Number (If applicable): | |||
| Conversion Price: | $ | ||
| Number of shares of Common Stock to be issued: | |||
Please issue the shares of Common Stock into which the Preferred Shares are being converted in the following name and to the following address:
| Issue to: | ||
| Address: | ||
| Telephone Number: | ||
| Facsimile Number: | ||
| Holder Name: | ||
| By: | ||
| (signature) | ||
| Title: | ||
| Dated: | ||
Account Number (if electronic book entry transfer): ______________________________________________________
Transaction Code Number (if electronic book entry transfer): ______________________________________________
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Exhibit 3.4
CERTIFICATE OF DESIGNATIONS OF PREFERENCES AND RIGHTS OF SERIES B
CONVERTIBLE PREFERRED STOCK
of
NextNRG, Inc.
a Nevada corporation
The undersigned Chief Executive Officer of NextNRG, Inc. (“Corporation”), a corporation organized and existing under the laws of the State of Nevada, does hereby certify that, pursuant to the authority contained in the Corporation’s Articles of Incorporation (“Articles”) and pursuant to Section 78.1955 of the Nevada Revised Statutes (“NRS”), and in accordance with the provisions of the resolution creating a series of the class of the Corporation’s authorized preferred stock designated as Series B Convertible Preferred Stock as follows:
FIRST: The Articles authorize the issuance by the Corporation of 500,000,000 shares of common stock, par value of $0.0001 per share (“Common Stock”) and 50,000,000 shares of preferred stock, par value of $0.0001 per share (“Preferred Stock”), and further, authorize the Board of Directors (“Board”) of the Corporation, by resolution or resolutions, at any time and from time to time, to divide and establish any or all of the unissued shares of Preferred Stock not then allocated to any series into one or more series and to designate the rights, preferences and limitations of each series.
SECOND: By unanimous written consent of the Board dated September 29, 2026, the Board designated 150,000 shares of the Preferred Stock as the Series B Convertible Preferred Stock, par value $0.0001 per share (“Series B Preferred Stock”), pursuant to a resolution providing that a series of preferred stock of the Corporation be and hereby is created and that the designation and number of shares thereof and the voting and other powers, preferences and relative, participating, optional or other rights of the shares of such Series B Preferred Stock, and the qualifications, limitations and restrictions thereof, are as follows:
SERIES B CONVERTIBLE PREFERRED STOCK
Section 1. Powers and Rights of Series B Convertible Preferred Stock. There is hereby designated a class of Preferred Stock of the Corporation as the Series B Convertible Preferred Stock, par value $0.0001 per share, of the Corporation (the “Series B Stock”). The number of shares, powers, terms, conditions, designations, preferences and privileges, relative, participating, optional and other special rights, and qualifications, limitations and restrictions, if any, of the Series B Stock shall be as set forth in this Certificate of Designations of Preferences and Rights of Series B Convertible Preferred Stock (this “Certificate of Designations”). For purposes hereon, a holder of a share or shares of Series B Stock, with respect to their rights as related to the Series B Stock, shall be referred to as a “Series B Holder”. The Corporation is the successor to NextNRG, Inc., a Delaware corporation (“Next-Delaware”), which converted to the Corporation as a Nevada corporation on October 6, 2026, and the Series B Stock is being issued to the Series B Holder in exchange for the Series B Convertible Preferred Stock of Next-Delaware, as designated in the State of Delaware on August 16, 2024 (the “Original Designation Date”), and issued to the original Series A Holder on August 16, 2024 (the “Original Issuance Date”).
Section 2. Number and Stated Value. The number of authorized shares of Series B Stock is 150,000 shares. Each share of Series B Stock shall have initially have a stated value of $10.00 (the “Stated Value”). The Stated Value shall be subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Series B Stock occurring following the Original Designation Date.
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Section 3. Dividends and Distributions.
| (a) | Series B Dividends. The Series B Stock shall accrue dividends at the rate of 12% per annum of the Stated Value, which shall be accrue on a quarterly basis per calendar quarter following the Original Issuance Date, being the date of the issuance of the shares of Series B Convertible Preferred Stock of Next-Delaware to the Series B Holder, for which the Series B Stock shall be issued in exchange (the “Series B Dividend”). The Series B Dividend shall be due and payable within five Business Days (as defined below) of the end of each such calendar quarter, and shall be payable to the Series B Holder thereof via the issuance to the Series B Holder of a number of shares of common stock, par value $0.0001 per share of the Corporation (the “Common Stock”) equal to (i) the amount of the Series B Dividend, divided by (ii) the Conversion Price (as defined below) as in effect on the last Business Day of the preceding calendar quarter, in each case rounded to the nearest whole share of Common Stock (such shares of Common Stock, the “Dividend Shares”). In the event that any Series B Dividend is not paid when otherwise due due to the limitations as set forth in this Certificate of Designations, such Series B Dividend shall accrue and the applicable Dividend Shares shall be issued when permissible pursuant to the provisions of this Certificate of Designations. The Series B Dividend shall accrue commencing on the Original Issuance Date with respect to the applicable Series B Stock and shall cease to accrue on conversion of the applicable shares of Series B Stock, and the Series B Dividend for any partial calendar quarter shall be appropriately pro-rated. For purposes herein, a “Business Day” shall mean any day on which commercial banks are generally open for business in the State of Nevada. |
| (b) | Participation. The Series B Stock shall not participate in any other dividends or distributions made with respect to the Common Stock. |
| (c) | Other Distributions. Other than as specifically set forth herein, including, without limitation, in Section 3(a) or Section 3(b), the Series B Stock is not entitled to receive any dividends or distributions due solely to its status as Series B Stock, and the Series B Stock shall not participate in any dividends, distributions or payments to the holders of any other classes of stock of the Corporation other than the Common Stock as set forth herein. |
Section 4. Conversion.
| (a) | General Provisions. Subject to the terms and conditions herein, a Series B Holder shall have the right at any time to convert the Series B Stock, and the Series B Stock shall be convertible, into shares of Common Stock as set forth herein (such shares of Common Stock being referred to as the “Conversion Shares”) as set forth herein (each, a “Conversion”). |
| (b) | Conversion Price. |
| (i) | For purposes herein, the “Conversion Price” means 700% of the Minimum Price, as defined in Rule 5635 of The Nasdaq Stock Market LLC Rules, as of the Original Issuance Date, subject to adjustment as set forth herein. |
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| (ii) | Each share of Series B Stock converted in a Conversion shall be convertible into a number of Conversion Shares equal to (1) the Stated Value; divided by (2) the then-applicable Conversion Price, in each case rounded to the nearest whole share of Common Stock, calculated collectively with respect to all shares of Series B Stock being converted pursuant to any Notice of Conversion. |
| (iii) | A Series B Holder shall elect a Conversion by delivering to the Corporation a notice of conversion in the form as attached hereto as Exhibit A (the “Notice of Conversion”) at any time. Together with the Notice of Conversion, the Series B Holder shall surrender any certificate or certificates for the Series B Stock being converted, duly endorsed. The calculation of Conversion Shares to be issued as set forth in the Notice of Conversion shall be subject to confirmation and approval of the Corporation. The Corporation shall, within three Business Days (as defined below) of receipt of a Notice of Conversion, issue to the applicable Series B Holder the number of Conversion Shares to which such Series B Holder shall be entitled. A Conversion shall be deemed to have been effected on the date the Notice of Conversion is submitted to the Corporation if delivered by facsimile, e-mail or other reasonable means of communication dispatched prior to 6:00 p.m., Eastern time, and provided that if the Notice of Conversion is not delivered by such time then the conversion date shall be the next Business Day and the Notice of Conversion shall be deemed automatically updated accordingly. |
| (c) | Concerning the Conversion Shares. The Conversion Shares and any Dividend Shares may not be sold or transferred unless: (i) such Conversion Shares or Dividend Shares are sold pursuant to an effective registration statement under the Securities Act of 1933, as amended (together with the rules and regulations thereunder, the “Securities Act”) or (ii) the Corporation and its transfer agent shall have been furnished with an opinion of counsel (which opinion shall be in form, substance and scope customary for opinions of counsel in comparable transactions) to the effect that the shares to be sold or transferred may be sold or transferred pursuant to an exemption from such registration (such as Rule 144 or a successor rule) (“Rule 144”); or (iii) such Conversion Shares or Dividend Shares are transferred to an “affiliate” (as defined in Rule 144) of the applicable Series B Holder who agrees to sell or otherwise transfer the shares only in accordance with this section and who is an accredited investor (as defined in Rule 501 under Regulation D promulgated pursuant to the Securities Act). Any restrictive legend on any certificates representing the Conversion Shares or any Dividend Shares shall be removed and the Corporation shall issue to the applicable Series B Holder a new certificate therefore free of any transfer legend if the Corporation or its transfer agent shall have received an opinion of counsel from applicable Series B Holder’s counsel, in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect that (i) a public sale or transfer of such Conversion Shares or Dividend Shares may be made without registration under the Securities Act, which opinion shall be accepted by the Corporation so that the sale or transfer is effected; or (ii) in the case of Conversion Shares or Dividend Shares such security is registered for sale by the applicable Series B Holder under an effective registration statement filed under the Securities Act; or otherwise may be sold pursuant to an exemption from registration. |
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| (d) | Adjustment Due to Merger, Consolidation, Etc. If, at any time when the Series B Stock is issued and outstanding and prior to conversion of the applicable share(s) of Series B Stock, the Common Stock is converted into another class of securities of the Corporation or any successor entity to the Corporation, whether by way of merger, reorganization, re-incorporation or otherwise (the “Replacement Securities”), any reference herein to the Common Stock (whether standing alone or as part of another defined term herein) automatically upon the consummation of the applicable transaction shall be deemed a reference to such Replacement Securities. In the event that the Corporation completes a share exchange with another entity wherein all of the issued and outstanding shares of Common Stock are exchanged for equity interests in the other entity (the “Exchanged Securities”), any reference herein to the Common Stock (whether standing alone or as part of another defined term herein) automatically upon the consummation of the applicable transaction shall be deemed a reference to such Exchanged Securities. The adjustments in this Section 4(d) shall be undertaken each time any such event occurs. |
| (e) | Adjustment to Conversion Price Due to Splits. Without limiting any provision herewith, if the Corporation at any time on or after the Original Designation Date subdivides (by any stock split, stock dividend, stock combination, recapitalization or other similar transaction) the outstanding shares of Common Stock into a greater number of shares, the Conversion Price in effect immediately prior to such subdivision will be proportionately increased. Without limiting any provision herewith, if the Corporation at any time on or after the Original Designation Date (by any stock split, stock dividend, stock combination, recapitalization or other similar transaction) combines the outstanding shares of Common Stock into a smaller number of shares, the Conversion Price in effect immediately prior to such combination will be proportionately decreased. By way of example and not limitation, in the event of a two-for-one forward split of the Common Stock, whereby each share of Common Stock is converted into two shares of Common Stock, the Conversion Price shall be decreased by 50% and, in the event of a one-for-two reverse split of the Common Stock, whereby each two shares of Common Stock are converted into one share of Common Stock, the Conversion Price shall be increased by 100%. Any adjustment pursuant to this Section 4(e) shall become effective immediately after the effective date of such subdivision or combination. |
| (f) | Additional Provisions. |
| (i) | No fractional shares or scrip representing fractional shares of Common Stock shall be issued upon the Conversion of the Series B Stock or with respect to any issuance of any Dividend Shares. As to any fraction of a share of Common Stock which the Series B Holder would otherwise be entitled to acquire upon such Conversion or upon payment of any Series B Dividend, the Corporation 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 fair market value of a share of Common Stock as determined in good faith by the Board of Directors of the Corporation, or round up to the next whole share of Common Stock. |
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| (ii) | The issuance of Conversion Shares or Dividend Shares shall be made without charge to any Series B Holder for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such Conversion Shares or Dividend Shares, provided that the Corporation shall not be required to pay any tax that may be payable in respect of any transfer involved in the issuance and delivery of any such Conversion Shares or Dividend Shares in a name other than that of the Series B Holders of such shares of Series B Stock and the Corporation shall not be required to issue or deliver such Conversion Shares or Dividend Shares unless or until the Person (as defined below) or Persons requesting the issuance thereof shall have paid to the Corporation the amount of such tax or shall have established to the satisfaction of the Corporation that such tax has been paid. For purposes hereof, “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. |
| (iii) | The Corporation covenants that during the period the Conversion right exists, the Corporation will reserve from its authorized and unissued Common Stock a number of shares of Common Stock equal to at least 100% of the number of Conversion Shares then issuable on conversion of all shares of Series B Stock, free from preemptive rights, to provide for the issuance of Conversion Shares upon the full conversion of the Series B Stock issued and outstanding. |
Section 5. Vote. Other than as set forth in Section 6, each share of Series B Stock shall, on any matter submitted to the holders of the Common Stock, or any class thereof, for a vote, vote together with the Common Stock, or any class thereof, as applicable, as one class on such matter for as long as the share of Series B Stock is issued and outstanding and each share of Series B Stock shall have a number of votes on such matter equal to the number of Conversion Shares which would be issuable with respect to such Series B Stock as of the date of such vote, and, for purposes of this Section 5, provided, that, for purposes of this Section 5, the “Conversion Price” used for the determination of the number of Conversion Shares which would be issuable with respect to such Series B Stock shall be the Minimum Price, as defined in Rule 5635 of The Nasdaq Stock Market LLC Rules, as of the date of issuance of the shares of Series B Stock.
Section 6. Amendment and Protective Provisions. The Corporation may not, and shall not, amend or repeal this Certificate of Designations without the prior written consent of Series B Holders holding a majority of the Series B Stock then issued and outstanding, in which vote each share of Series B Stock then issued and outstanding shall have one vote, voting separately as a single class, in person or by proxy, either in writing without a meeting or at an annual or a special meeting of such Series B Holders, or in a written consent executed by Series B Holders holding a majority of the issued and outstanding shares of Series B Stock, and any such act or transaction entered into without such vote or consent shall be null and void ab initio, and of no force or effect.
Section 7. Miscellaneous.
| (a) | Legend. Any certificates representing the Series B Stock shall bear a restrictive legend in substantially the following form (and a stop transfer order may be placed against transfer of such stock certificates): |
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, NOR REGISTERED NOR QUALIFIED UNDER ANY STATE SECURITIES LAWS. SUCH SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, DELIVERED AFTER SALE, TRANSFERRED, PLEDGED, OR HYPOTHECATED UNLESS QUALIFIED AND REGISTERED UNDER APPLICABLE STATE AND FEDERAL SECURITIES LAWS OR UNLESS, IN THE OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY, SUCH QUALIFICATION AND REGISTRATION IS NOT REQUIRED. ANY TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS FURTHER SUBJECT TO OTHER RESTRICTIONS, TERMS AND CONDITIONS WHICH ARE SET FORTH HEREIN.
| 5 |
| (b) | Lost or Mutilated Series B Stock Certificate. If the certificate for the Series B Stock held by the Series B Holder thereof shall be mutilated, lost, stolen or destroyed, the Corporation shall execute and deliver, in exchange and substitution for and upon cancellation of a mutilated certificate, or in lieu of or in substitution for a lost, stolen or destroyed certificate, a new certificate for the share of Series B Stock so mutilated, lost, stolen or destroyed but only upon receipt of evidence of such loss, theft or destruction of such certificate, and of the ownership hereof, and indemnity, if requested, all reasonably satisfactory to the Corporation. |
| (c) | No Registration Rights. The Series B Holders shall not have the right to require the Corporation to register any shares of Series B Stock or any Conversion Shares for sale pursuant to the securities laws of the United States, except as may be separately agreed between a Series B Holder and the Corporation |
| (d) | Interpretation. If a Series B Holder shall commence an action or proceeding to enforce any provisions of this Certificate of Designations, 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 with the investigation, preparation and prosecution of such action or proceeding. |
| (e) | Waiver. Any waiver by the Corporation or the Series B Holder of a breach of any provision of this Certificate of Designations shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Certificate of Designations. The failure of the Corporation or the Series B Holder to insist upon strict adherence to any term of this Certificate of Designations on one or more occasions shall not be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Certificate of Designations. Any waiver must be in writing. |
Section 8. Severability. If any provision of this Certificate of Designations is invalid, illegal or unenforceable, the balance of this Certificate of Designations shall remain in effect, and if any provision is inapplicable to any person or circumstance, it shall nevertheless remain applicable to all other persons and circumstances. If it shall be found that any interest or other amount deemed interest due hereunder violates applicable laws governing usury, the applicable rate of interest due hereunder shall automatically be lowered to equal the maximum permitted rate of interest.
[Signature Page Follows]
| 6 |
IN WITNESS WHEREOF, the undersigned has executed this Certificate of Designation on this 7th day of October, 2026.
| By: | /s/ Michael D. Farkas | |
| Name: | Michael D. Farkas | |
| Title: | Chief Executive Officer |
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EXHIBIT A
NextNRG, Inc.
Notice of Conversion
Reference is made to the Certificate of Designations of Preferences and Rights of Series B Convertible Preferred Stock of NextNRG, Inc. (the “Corporation”) dated as of October 7, 2026, designating the rights and preferences of the Series B Convertible Preferred Stock of the Corporation (the “Certificate of Designations”). In accordance with and pursuant to the Certificate of Designations, the undersigned hereby elects to convert the number of shares of Series B Convertible Preferred Stock, $0.0001 par value per share (the “Preferred Shares”), of the Corporation indicated below into shares of common stock, $0.0001 par value per share (the “Common Stock”), of the Corporation, as of the date specified below.
| Date of Conversion: | |||
| Number of Preferred Shares to be converted: | |||
| Tax ID Number (If applicable): | |||
| Conversion Price: | $ | ||
| Number of shares of Common Stock to be issued: | |||
Please issue the shares of Common Stock into which the Preferred Shares are being converted in the following name and to the following address:
| Issue to: | ||
| Address: | ||
| Telephone Number: | ||
| Facsimile Number: | ||
| Holder Name: | ||
| By: | ||
| (signature) | ||
| Title: | ||
| Dated: | ||
Account Number (if electronic book entry transfer): ______________________________________________________
Transaction Code Number (if electronic book entry transfer): ______________________________________________
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Exhibit 3.5
NEXTNRG, INC.
CERTIFICATE OF DESIGNATION OF PREFERENCES, RIGHTS AND LIMITATIONS
OF
SERIES C CONVERTIBLE NON-VOTING PREFERRED STOCK
NextNRG, Inc., a corporation organized and existing under the laws of the State of Nevada (the “Corporation”) is authorized to issue 5,000,000 shares of “blank check” preferred stock, par value $0.0001 per share, 513,000 shares of which are designated as Series A Preferred Stock, par value $0.0001 per share, none of which are outstanding, and 150,000 shares of which are designated as Series B Preferred Stock, par value $0.0001 per share, 140,000 of which are outstanding.
The following resolutions were duly adopted by the board of directors of the Corporation (the “Board of Directors”):
WHEREAS, the Corporation’s articles of incorporation (the “Articles of Incorporation”) provide for a class of its authorized stock known as “blank check” preferred stock, consisting of 5,000,000 shares, $0.0001 par value per share, issuable from time to time in one or more series (“Preferred Stock”);
WHEREAS, the Board of Directors is authorized from time to time to fix the dividend rights, dividend rate, voting rights, conversion rights, rights and terms of redemption and liquidation preferences of any wholly unissued series of Preferred Stock and the number of shares constituting any series and the designation thereof, of any of them; and
WHEREAS, the Board of Directors, pursuant to its authority as aforesaid and upon advice of counsel, believes it advisable and in the best interests of the Corporation and its stockholders to fix the rights, preferences, restrictions and other matters relating to a new series of Preferred Stock, which shall consist of 3,000,000 shares of the Preferred Stock which the Corporation has the authority to issue.
NOW, THEREFORE, BE IT RESOLVED, that pursuant to the authority vested in the Board of Directors, the Board of Directors hereby authorizes a new series of up to 3,000,000 shares of Preferred Stock designated as the Series C Convertible Non-Voting Preferred Stock, par value $0.0001 per share, having the voting powers, designations, preferences and relative participation and other rights and qualifications, limitations and restrictions follows:
TERMS OF PREFERRED STOCK
Section 1. Definitions. For the purposes hereof, the following terms shall have the following meanings:
“Adjustment Right” means any right granted with respect to any securities issued in connection with, or with respect to, any issuance or sale of shares of Common Stock that could result in a decrease in the net consideration received by the Corporation in connection with, or with respect to, such securities (including, without limitation, any cash settlement rights, cash adjustment or other similar rights).
“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 of the Securities Act.
“Alternate Conversion Amount” shall have the meaning set forth in Section 6(d)(i).
“Alternate Conversion Date” shall have the meaning set forth in Section 6(d)(i).
“Alternate Conversion Price” means the price which shall be the lower of (i) the applicable Conversion Price as in effect on the applicable Conversion Date of the applicable Alternate Conversion, and (ii) the greater of (x) the Floor Price and (y) 95% of the lowest daily VWAP of the Common Stock during the fifteen (15) consecutive Trading Day period ending and including the Trading Day immediately preceding the delivery or deemed delivery of the applicable Notice of Conversion, provided, however, that from and after the occurrence and during the continuance of any Trigger Event or Mandatory Redemption Event, the reference to “95%” in clause (y) above shall be replaced with “80%”; provided further, that if a Holder has delivered a Reservation Notice and the shares of Common Stock subject to such Alternate Conversion include Reservation Shares, the Alternate Conversion Price for such Reservation Shares shall be the lower of (A) the applicable Reservation Conversion Price and (B) the Alternate Conversion Price.
“Alternate Conversion Floor Amount” means an amount, equal to the product obtained by multiplying (A) the VWAP of the Common Stock on the Trading Day immediately preceding the time that the Holder delivers the applicable Notice of Conversion and (B) the difference obtained by subtracting (I) the number of shares of Common Stock delivered (or to be delivered) to the Holder on the applicable Share Delivery Deadline with respect to such Alternate Conversion from (II) the quotient obtained by dividing (x) the applicable Conversion Amount that the Holder has elected to be the subject of the applicable Alternate Conversion, by (y) the applicable Alternate Conversion Price without giving effect to clause (x) of such definition.
“Approved Share Plan” means any employee benefit plan which has been approved by the Board of Directors prior to or subsequent to the Original Designation Date hereof pursuant to which Common Stock and standard options to purchase shares of Common Stock may be issued to any employee, officer or director for services provided to the Corporation in their capacity as such.
“Attribution Parties” means, collectively, the following Persons and entities: (i) any investment vehicle, including any funds, feeder funds or managed accounts, currently, or from time to time after the Original Designation Date, directly or indirectly managed or advised by the Holder’s investment manager or any of its Affiliates or principals, (ii) any direct or indirect Affiliates of the Holder or any of the foregoing, (iii) any Person acting or who could be deemed to be acting as a Group together with the Holder or any of the foregoing and (iv) any other Persons whose beneficial ownership of the Common Stock would or could be aggregated with the Holder’s and the other Attribution Parties for purposes of Section 13(d) of the Exchange Act. For clarity, the purpose of the foregoing is to subject collectively the Holder and all other Attribution Parties to the Beneficial Ownership Limitation.
“Articles of Incorporation” means the Corporation’s amended and restated articles of incorporation as in effect on the date hereof, as it may be further amended and/or restated from time to time.
“Authorized Share Failure” shall have the meaning set forth Section 6(c)(iii).
“Beneficial Ownership Limitation” shall have the meaning set forth in Section 6(e).
“Black Scholes Consideration Value” means the value of the applicable Option, Common Stock Equivalent or Adjustment Right (as the case may be) as of the date of issuance thereof calculated using the Black Scholes Option Pricing Model obtained from the “OV” function on Bloomberg, L.P. utilizing (i) an underlying price per share equal to the Official Closing Price on the Trading Day immediately preceding the public announcement of the execution of definitive documents with respect to the issuance thereof, (ii) a risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to the remaining term thereof as of the date of issuance, (iii) a zero cost of borrow and (iv) an expected volatility equal to the greater of 100% and the 100 day volatility obtained from the “HVT” function on Bloomberg, L.P. (determined utilizing a 365 day annualization factor) as of the Trading Day immediately following the date of issuance thereof.
“Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York generally are open for use by customers on such day.
“Buy-In” shall have the meaning set forth in Section 6(c)(ii).
“Buy-In Price” shall have the meaning set forth in Section 6(c)(ii).
“Buy-In Payment Amount” shall have the meaning set forth in Section 6(c)(ii). “Certificate of Designation” means this Certificate of Designation of preferences, rights and limitations of Series C Convertible Non-Voting Preferred Stock.
“Closing Bid Price” means, as of any date, the last closing bid price of the Common Stock on the Principal Market, as reported by the Reporting Service.
“Commission” means the United States Securities and Exchange Commission.
“Common Stock” means the Corporation’s common stock, par value $0.0001 per share, and stock of any other class of securities into which such securities may hereafter be reclassified or changed.
“Common Stock Equivalents” means any securities of the Corporation or the Subsidiaries which would entitle the holder thereof to acquire at any time Common Stock, including, without limitation, any debt, preferred stock, rights, options, warrants 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.
“Contingent Obligation” means, as to any Person, any direct or indirect liability, contingent or otherwise, of that Person with respect to any Indebtedness, lease, dividend or other obligation of another Person if the primary purpose or intent of the Person incurring such liability, or the primary effect thereof, is to provide assurance to the obligee of such liability that such liability will be paid or discharged, or that any agreements relating thereto will be complied with, or that the holders of such liability will be protected (in whole or in part) against loss with respect thereto
“Conversion Amount” means 105% of the sum of (i) the Stated Value at issue, (ii) all accrued and unpaid dividends and (iii) any other unpaid amounts payable by the Corporation to the Holder pursuant to the Transaction Documents through the Conversion Date.
“Conversion Date” shall have the meaning set forth in Section 6(a).
“Conversion Failure” shall have the meaning set forth in Section 6(c)(ii).
“Conversion Floor Price Condition” means, with respect to any date of determination, that the relevant Alternate Conversion Price is being (or, if a Notice of Conversion were delivered on such date, would be) determined based on clause (x) of clause (ii) of the definition thereof.
“Conversion Floor Price Deferral” means, solely with respect to any Alternate Conversion at a time a Conversion Floor Price Condition exists, the election by the Corporation, in lieu of delivering the applicable Alternate Conversion Floor Amount in cash, to defer such payment, in which case on the applicable Alternate Conversion Date the Stated Value of the remaining shares of Series C Preferred Stock of such Holder shall automatically increase, pro rata, by the applicable Alternate Conversion Floor Amount.
“Conversion Price” shall have the meaning set forth in Section 6(b).
“Conversion Shares” means, collectively, the shares of Common Stock issuable upon conversion of the shares of Series C Preferred Stock in accordance with the terms hereof.
“Default Rate” means eighteen percent (18%), per annum.
“Dividend Conversion Price” means, with respect to any given Dividend Date, the price which shall be the lower of (i) the applicable Conversion Price as in effect on the applicable Dividend Date, and (ii) the greater of (x) the Floor Price and (y) 90% of the lowest VWAP of the Common Stock during the five (5) consecutive Trading Day period ending and including the Trading Day immediately preceding such Dividend Date. All such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification or similar transaction that proportionately decreases or increases the Common Stock during such period.
“Dividend Date” shall have the meaning set forth in Section 3.
“Eligible Market” means the New York Stock Exchange, the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Select Market, the Nasdaq Global Market or the Principal Market.
“Equity Conditions” means, with respect to any given date of determination: (i) on each day during the period beginning twenty (20) Trading Days prior to such applicable date of determination and ending on and including such applicable date of determination either (x) one or more Registration Statements (as defined in the Registration Rights Agreement) filed pursuant to the Registration Rights Agreement (as defined in the Purchase Agreement) shall be effective and the prospectus contained therein shall be available on such applicable date of determination (with, for the avoidance of doubt, any Conversion Shares previously sold pursuant to such prospectus deemed unavailable) for the resale of all Conversion Shares to be issued in connection with the event requiring this determination (or issuable upon conversion of the Conversion Amount being redeemed, as applicable, in the event requiring this determination at the Alternate Conversion Price then in effect (without regard to any limitations on conversion set forth herein)) (each, a “Required Minimum Securities Amount”), in each case, in accordance with the terms of the Registration Rights Agreement and there shall not have been during such period any Grace Periods (as defined in the Registration Rights Agreement) or (y) all Registrable Securities (as defined in the Registration Rights Agreement) shall be eligible for sale pursuant to Rule 144 (as defined in the Purchase Agreement) without the need for registration under any applicable federal or state securities laws (in each case, disregarding any limitation on conversion of the shares of Series C Preferred Stock) and no Current Public Information Failure (as defined in the Registration Rights Agreement) exists or is continuing; (ii) on each day during the period beginning twenty (20) Trading Days prior to the applicable date of determination and ending on and including the applicable date of determination (the “Equity Conditions Measuring Period”), the Common Stock (including all Registrable Securities) is listed or designated for quotation (as applicable) on an Eligible Market and shall not have been suspended from trading on an Eligible Market (other than suspensions of not more than one (1) day and occurring prior to the applicable date of determination due to business announcements by the Corporation) nor shall delisting or suspension by an Eligible Market have been threatened (with a reasonable prospect of delisting occurring after giving effect to all applicable notice, appeal, compliance and hearing periods) or reasonably likely to occur or pending as evidenced by (A) a writing by such Eligible Market or (B) the Corporation falling below the minimum listing maintenance requirements of the Eligible Market on which the Common Stock is then listed or designated for quotation (as applicable); (iii) during the Equity Conditions Measuring Period, the Corporation shall have delivered all Conversion Shares on a timely basis and all other shares of capital stock required to be delivered, and paid all amounts required to be paid, by the Corporation on a timely basis as set forth in the other Transaction Documents; (iv) any shares of Common Stock to be issued in connection with the event requiring determination (or issuable upon conversion of the Conversion Amount being redeemed in the event requiring this determination) may be issued in full without violating Section 6(e) hereof; (v) any shares of Common Stock to be issued in connection with the event requiring determination (or issuable upon conversion of the Conversion Amount being redeemed in the event requiring this determination (without regards to any limitations on conversion set forth herein)) may be issued in full without violating the rules or regulations of the Eligible Market on which the shares of Common Stock are then listed or designated for quotation (as applicable); (vi) on each day during the Equity Conditions Measuring Period, no public announcement of a pending, proposed or intended Fundamental Transaction shall have occurred which has not been abandoned, terminated or consummated; (vii) the Corporation shall have no knowledge of any fact that would reasonably be expected to cause (1) any Registration Statement required to be filed pursuant to the Registration Rights Agreement to not be effective or the prospectus contained therein to not be available for the resale of the applicable Required Minimum Securities Amount of Registrable Securities in accordance with the terms of the Registration Rights Agreement or (2) any Registrable Securities to not be eligible for sale pursuant to Rule 144 without the need for registration under any applicable federal or state securities laws (in each case, disregarding any limitation on conversion of the Series C Preferred Stock) and no Current Public Information Failure exists or is continuing; (viii) the Holders shall not be in possession of any material, non-public information provided to any of them by the Corporation, any of its Subsidiaries or any of their respective affiliates, employees, officers, representatives, agents or the like; (ix) on each day during the Equity Conditions Measuring Period, the Corporation otherwise shall have been in compliance with each, and shall not have breached any representation or warranty in any material respect (other than representations or warranties subject to material adverse effect or materiality, which may not be breached in any respect) or any covenant or other term or condition of any Transaction Document, including, without limitation, the Corporation shall not have failed to timely make any payment pursuant to any Transaction Document; (x) on the applicable date of determination (A) no Authorized Share Failure shall exist or be continuing and the Required Reserve Amount of shares of Common Stock are available under the Articles of Incorporation and reserved by the Corporation to be issued pursuant to this Certificate of Designation and (B) all shares of Common Stock to be issued in connection with the event requiring this determination (or issuable upon conversion of the Conversion Amount being redeemed in the event requiring this determination (without regards to any limitations on conversion set forth herein)) may be issued in full without resulting in an Authorized Share Failure; (xi) on each day during the Equity Conditions Measuring Period, there shall not have occurred and there shall not exist a Mandatory Redemption Event or a Trigger Event or an event that with the passage of time or giving of notice would constitute a Mandatory Redemption Event or Trigger Event; (xii) no bona fide dispute shall exist, by and between any Holder, the Corporation, the Principal Market (or such applicable Eligible Market on which the shares of Common Stock are then principally traded) and/or FINRA with respect to any term or provision of the Series C Preferred Stock or any other Transaction Document; (xiii) the shares of Common Stock issuable pursuant to the event requiring the satisfaction of the Equity Conditions are duly authorized and listed and eligible for trading without restriction on an Eligible Market; (xiv) no Current Public Information Failure (as defined in the Registration Rights Agreement) exists or is continuing; (xv) on each Trading Day during the Equity Conditions Measuring Period, there shall not have occurred any Price Failure or Volume Failure; (xvi) the Alternate Conversion Price is not determined by the Conversion Floor Price Condition; and (xvii) either (A) the Stockholder Approval Date shall have occurred, or (B) Effective Stockholder Approval (as defined in the Purchase Agreement) shall have been obtained for the issuance of all shares of Common Stock to be issued in connection with the event requiring this determination (it being agreed that the Effective Stockholder Approval obtained by Next-Delaware in connection with the Initial Closing (as defined in the Purchase Agreement) shall be deemed to cover the issuance of all shares of Common Stock issuable hereunder with respect to the shares of Series C Preferred Stock with an Original Issuance Date of August 13, 2026).
“Equity Conditions Failure” means that on any day during the period commencing twenty (20) Trading Days prior to the applicable date of determination, the Equity Conditions have not been satisfied (or waived in writing by the Required Holders).
“Event Market Price” means, with respect to any Stock Combination Event Date, the quotient determined by dividing (x) the sum of the VWAP of the Common Stock for each of the five (5) Trading Days with the lowest VWAP of the Common Stock during the fifteen (15) consecutive Trading Day period ending and including the Trading Day immediately preceding the sixteenth (16th) Trading Day after such Stock Combination Event Date, divided by (y) five (5).
“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Excluded Securities” means (i) shares of Common Stock or standard options to purchase shares of Common Stock to directors, officers or employees of the Corporation in their capacity as such pursuant to an Approved Share Plan or such agreements with such directors, officers or employees of the Corporation existing as of the date of the Purchase Agreement, provided that (A) all such issuances (taking into account the shares of Common Stock issuable upon exercise of such options) after the Initial Closing Date (as defined in the Purchase Agreement) pursuant to this clause (i) do not, in the aggregate, exceed more than 20% of the Common Stock issued and outstanding immediately prior to the Initial Closing Date (as adjusted for the 2026 Reverse Split and any subsequent stock split, stock dividend, stock combination or other similar transaction) and (B) the exercise price of any such options is not lowered, none of such options are amended to increase the number of shares issuable thereunder and none of the terms or conditions of any such options are otherwise materially changed in any manner that adversely affects any of the Holders; (ii) shares of Common Stock issued upon the conversion or exercise of Options or Common Stock Equivalents (other than standard options to purchase shares of Common Stock issued pursuant to an Approved Share Plan or such agreements with such directors, officers or employees of the Corporation existing as of the date of the Purchase Agreement that are covered by clause (i) above) issued prior to the date of the Purchase Agreement, provided that the conversion, exercise or other method of issuance (as the case may be) of any such Common Stock Equivalent is made solely pursuant to the conversion, exercise or other method of issuance (as the case may be) provisions of such Common Stock Equivalents that were in effect on the date immediately prior to the date of the Purchase Agreement, the conversion, exercise or issuance price of any such Common Stock Equivalents (other than standard options to purchase shares of Common Stock issued pursuant to an Approved Share Plan or such agreements with such directors, officers or employees of the Corporation existing as of the date of the Purchase Agreement that are covered by clause (i) above) is not lowered, none of such Common Stock Equivalents (other than standard options to purchase shares of Common Stock issued pursuant to an Approved Share Plan or such agreements with such directors, officers or employees of the Corporation existing as of the date of the Purchase Agreement that are covered by clause (i) above) are amended to increase the number of shares issuable thereunder and none of the terms or conditions of any such Common Stock Equivalents (other than standard options to purchase shares of Common Stock issued pursuant to an Approved Share Plan or such agreements with such directors, officers or employees of the Corporation existing as of the date of the Purchase Agreement that are covered by clause (i) above) are otherwise materially changed in any manner that adversely affects any of the Holders; (iii) the Conversion Shares; (iv) any Project Financing that is not convertible into, exercisable or exchangeable for, or otherwise linked to, any equity securities of the Corporation or any Subsidiary (other than any applicable Project Subsidiary); and (v) shares of Common Stock or equity-linked securities issued as consideration in a bona fide acquisition by the Corporation or any of its Subsidiaries of the business, assets or equity of another Person, or in a bona fide strategic transaction, in each case approved by a majority of the disinterested directors of the Corporation, provided that any such issuance shall only be to a Person (or to the equityholders of a Person) that is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business of the Corporation and that provides to the Corporation additional benefits in addition to the investment of funds, but shall not include any transaction in which the Corporation is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is investing in securities, and provided further that the securities so issued are “restricted securities” (as defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement during any Restricted Period (as defined in the Purchase Agreement); provided, however, that (A) any issuance pursuant to clause (i), (ii), (iv) or (v) above at an effective consideration price per share less than or equal to 110% of the Floor Price in effect immediately prior to such issuance shall not constitute an issuance of Excluded Securities for purposes of Section 7(b), and the Conversion Price shall be reduced pursuant to Section 7(b) to the lowest price per share at which any share of Common Stock is issued or issuable in connection with such issuance (and, separately, the Corporation shall not effect any such issuance), (B) no issuance pursuant to clauses (iv) or (v) above shall constitute an issuance of Excluded Securities for purposes of Section 7(b) or any other adjustment of the Conversion Price pursuant to Section 7 and (C) nothing in this definition shall limit or restrict the issuance of any shares of Common Stock issuable pursuant to this Certificate of Designation (including, without limitation, Conversion Shares and Dividend Shares).
“Floor Price” means $1.35; provided that, subject to the rules and regulations of the Principal Market, the Corporation may lower the Floor Price at any time upon written notice to the Holders. The Floor Price shall be subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions.
“Fundamental Transaction” means (i) that the Corporation shall, directly or indirectly, including through subsidiaries, Affiliates or otherwise, in one or more related transactions, (A) consolidate or merge with or into (whether or not the Corporation is the surviving corporation) another Subject Entity, (B) sell, assign, transfer, convey or otherwise dispose of all or substantially all of the properties or assets of the Corporation or any of its Significant Subsidiaries to one or more Subject Entities or (C) make, or allow one or more Subject Entities to make, or allow the Corporation to be subject to or have its shares of Common Stock be subject to or party to one or more Subject Entities making, a purchase, tender or exchange offer that is accepted by the holders of more than either (x) 50% of the outstanding shares of Common Stock, (y) 50% of the outstanding shares of Common Stock calculated as if any shares of Common Stock held by all Subject Entities making or party to, or affiliated with any Subject Entities making or party to, such purchase, tender or exchange offer were not outstanding; or (z) such number of shares of Common Stock such that all Subject Entities making or party to, or affiliated with any Subject Entity making or party to, such purchase, tender or exchange offer, become collectively the beneficial owners (as defined in Rule 13d-3 under the Exchange Act) of more than 50% of the outstanding shares of Common Stock, or (D) consummate a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with one or more Subject Entities whereby all such Subject Entities, individually or in the aggregate, acquire, either (x) more than 50% of the outstanding shares of Common Stock, (y) more than 50% of the outstanding shares of Common Stock calculated as if any shares of Common Stock held by all the Subject Entities making or party to, or affiliated with any Subject Entity making or party to, such stock or share purchase agreement or other business combination were not outstanding; or (z) such number of shares of Common Stock such that the Subject Entities become collectively the beneficial owners (as defined in Rule 13d-3 under the Exchange Act) of more than 50% of the outstanding shares of Common Stock, or (E) reorganize, recapitalize or reclassify its shares of Common Stock, (ii) that the Corporation shall, directly or indirectly, including through subsidiaries, Affiliates or otherwise, in one or more related transactions, allow any Subject Entity individually or the Subject Entities in the aggregate to be or become the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, whether through acquisition, purchase, assignment, conveyance, tender, tender offer, exchange, reduction in outstanding shares of Common Stock, merger, consolidation, business combination, reorganization, recapitalization, spin-off, scheme of arrangement, reorganization, recapitalization or reclassification or otherwise in any manner whatsoever, of either (x) more than 50% of the aggregate voting power represented by issued and outstanding shares of Common Stock, (y) more than 50% of the aggregate voting power represented by issued and outstanding shares of Common Stock not held by all such Subject Entities as of the Original Designation Date calculated as if any shares of Common Stock held by all such Subject Entities were not outstanding, or (z) a percentage of the aggregate ordinary voting power represented by issued and outstanding shares of Common Stock or other equity securities of the Corporation sufficient to allow such Subject Entities to effect a statutory short form merger or other transaction requiring other shareholders of the Corporation to surrender their shares of Common Stock without approval of the shareholders of the Corporation or (iii) directly or indirectly, including through subsidiaries, Affiliates or otherwise, in one or more related transactions, the issuance of or the entering into any other instrument or transaction structured in a manner to circumvent, or that circumvents, the intent of this definition in which case this definition shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this definition to the extent necessary to correct this definition or any portion of this definition which may be defective or inconsistent with the intended treatment of such instrument or transaction.
“Group” means a “group” as that term is used in Section 13(d) of the Exchange Act and defined in Rule 13d-5 thereunder.
“Holder” shall have the meaning given such term in Section 2.
“Indebtedness” means, without duplication (i) all indebtedness for borrowed money, (ii) all obligations issued, undertaken or assumed as the deferred purchase price of property or services (including, without limitation, “capital leases” in accordance with general accepted accounting principles) (other than trade payables entered into in the ordinary course of business consistent with past practice), (iii) all reimbursement or payment obligations with respect to letters of credit, surety bonds and other similar instruments, (iv) all obligations evidenced by notes, bonds, debentures or similar instruments, including obligations so evidenced incurred in connection with the acquisition of property, assets or businesses, (v) all indebtedness created or arising under any conditional sale or other title retention agreement, or incurred as financing, in either case with respect to any property or assets acquired with the proceeds of such indebtedness (even though the rights and remedies of the seller or bank under such agreement in the event of default are limited to repossession or sale of such property), (vi) all monetary obligations under any leasing or similar arrangement which, in connection with generally accepted accounting principles, consistently applied for the periods covered thereby, is classified as a capital lease, (vii) all indebtedness referred to in clauses (i) through (vi) above secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien upon or in any property or assets (including accounts and contract rights) owned by any Person, even though the Person which owns such assets or property has not assumed or become liable for the payment of such indebtedness, and (viii) all Contingent Obligations in respect of indebtedness or obligations of others of the kinds referred to in clauses (i) through (vii) above.
“Late Charges” shall have the meaning set forth in Section 10(e).
“Liens” means any preemptive or similar rights, mortgages, defects, claims, liens, pledges, charges, taxes, rights of first refusal, encumbrances, security interests and other encumbrances.
“Liquidation” shall have the meaning set forth in Section 5. “Liquidation Funds” shall have the meaning set forth in Section 5.
“Mandatory Redemption Event” shall have the meaning set forth in Section 10(b).
“Market Capitalization” shall mean the current market capitalization of the Common Stock as reported by the Reporting Service.
“Material Adverse Effect” means, any material adverse effect on (i) the business, properties, assets, liabilities, operations (including results thereof), condition (financial or otherwise) or prospects of the Corporation or any Subsidiary, individually or taken as a whole, (ii) the transactions contemplated hereby or in any of the other Transaction Documents or any other agreements or instruments to be entered into in connection herewith or therewith or (iii) the authority or ability of the Corporation or any of its Subsidiaries to perform any of their respective obligations under any of the Transaction Documents.
“Material Agreement” means (i) any agreement or other instrument to which the Corporation or any Subsidiary is a party with respect to a Subsequent Placement (as defined in the Purchase Agreement) regardless of when such agreement or instrument was entered into, and (ii) any agreement or other instrument (a) to which the Corporation or any Subsidiary is a party involving aggregate consideration payable to or by such party of $500,000 or more in any year or otherwise material to the business, condition (financial or otherwise), operations, performance, properties or prospects of the Corporation and its Subsidiaries taken as a whole or (b) any other contract, agreement, permit or license, written or oral, of the Corporation or any Subsidiary as to which the breach, nonperformance, cancellation or failure to renew by any party thereto, individually or in the aggregate, could reasonably be expected to have a material adverse affect on the business, condition (financial or otherwise), operations, performance, properties or prospects of the Corporation and its Subsidiaries taken as a whole.
“Nevada Courts” shall have the meaning set forth in Section 11(d).
“Notice Failure” shall have the meaning set forth in Section 6(c)(ii).
“Notice of Conversion” shall have the meaning set forth in Section 6(a).
“Official Closing Price” shall have the meaning set forth in Section 6(b).
“Options” means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Common Stock Equivalents.
“Original Issuance Date” means with respect to any shares of Series C Preferred Stock, the date of the first issuance of such shares of Series C Preferred Stock regardless of the number of transfers of shares of Series C Preferred Stock and regardless of the number of certificates which may be issued to evidence such Series C Preferred Stock, if applicable.
“Parent Entity” of a Person means an entity that, directly or indirectly, controls the applicable Person and whose common stock or other equity security is quoted or listed on an Eligible Market, or, if there is more than one such Person or Parent entity, the Person or Parent Entity with the largest public market capitalization as of the date of consummation of such Fundamental Transaction.
“Parity Stock” shall have the meaning set forth in Section 9.
“Per Share Redemption Price” means the quotient of (i) the product of (x) 125% and (y) the sum of (a) the Stated Value of the shares of Series C Preferred Stock being redeemed, plus (b) all accrued and unpaid dividends, if any, then outstanding on such Series C Preferred Stock, and (c) any other amounts owed by the Corporation to the Holder(s) with respect to the Series C Preferred Stock, divided by (ii) the number of shares of Series C Preferred Stock being redeemed.
“Permitted Equipment Indebtedness” means Indebtedness (whether secured or unsecured) incurred solely to finance the purchase price, acquisition or lease of equipment acquired or held by the Corporation or any of its Subsidiaries, and any extension, renewal or refinancing thereof that does not increase the principal amount thereof.
“Permitted Indebtedness” means, (i) Indebtedness outstanding on the date of the Purchase Agreement and disclosed on Schedule 3(s) to the Purchase Agreement, (ii) Permitted Equipment Indebtedness in an aggregate amount not to exceed Two Million Dollars ($2,000,000), (iii) Indebtedness of any entity acquired by the Corporation or any of its Subsidiaries after the Original Designation Date that either (x) is outstanding at the time of, and was not incurred in contemplation of, such acquisition or (y) is incurred at the time of such acquisition solely to finance the purchase price thereof (and any extension, renewal or refinancing of any of the foregoing that does not increase the principal amount thereof), in an aggregate amount not to exceed Ten Million Dollars ($10,000,000); provided that such Indebtedness (A) is incurred solely by the entity (or entities) or a subsidiary thereof, acquired in such acquisition, (B) is recourse solely to, and if secured, solely secured by the assets and equity of, such acquired entity and its subsidiaries, and (C) is not guaranteed by, and does not otherwise benefit from any credit support, keepwell, indemnity, co-obligation or assumption of liability of any kind from, the Corporation or any of its Subsidiaries (other than such acquired entity and its subsidiaries, and a pledge of the equity of such acquired entity), (iv) project financing for the development, construction, acquisition, ownership or operation of energy projects of the Corporation or any of its Subsidiaries (each, a “Project”), solely to the extent such Indebtedness: (A) is incurred solely by one or more of the Corporation’s Subsidiaries formed for the sole purpose of developing, constructing, owning or operating such Project (each, a “Project Subsidiary”), and not by the Corporation or any other Subsidiary; (B) is recourse solely to, and if secured, is secured solely by, the assets of such Project or Project Subsidiary and the equity interests in such Project Subsidiary, and is otherwise non-recourse to the Corporation or any Subsidiaries or their respective assets; (C) is not guaranteed by, and does not otherwise benefit from, any guarantee, keepwell, capital maintenance, equity contribution or completion obligation, cost-overrun guarantee, indemnity, letter of credit, co-obligation, credit support or assumption of liability of any kind from, the Corporation or any of its Subsidiaries (other than the applicable Project Subsidiary and a pledge of the equity interests in such Project Subsidiary); (D) does not contain, any cross-default, cross-acceleration or cross-collateralization provision linking such Indebtedness to any obligation of the Corporation or any other Subsidiary (or vice versa); (E) provides that, upon any default, foreclosure or other exercise of remedies in respect thereof, the sole recourse of the holders of such Indebtedness shall be to the assets of such Project or Project Subsidiary and the equity interests in such Project Subsidiary, without any deficiency claim, judgment or other recourse against the Corporation or any other Subsidiary; and (F) is not equity-linked or convertible into equity of the Corporation or other Subsidiaries (other than a Project Subsidiary) (Indebtedness described in this clause (iv), “Project Financing”), and (v) other debt financing necessary for the Corporation’s operations in an aggregate principal amount not to exceed One Million Dollars ($1,000,000) at any given time; provided, however, that no such Indebtedness described in any of clauses (i) through (v) above shall (A) be issued as a Common Stock Equivalent or otherwise be convertible into, or exercisable or exchangeable for, or entitle the holder thereof to receive, any capital stock or other equity interests (or any securities convertible into or exercisable or exchangeable for any capital stock or other equity interests) of the Corporation or any Subsidiary (other than, in the case of Project Financing, equity interests of the applicable Project Subsidiary), (B) have any interest, principal or other payment or conversion terms that adjust, vary or reset by reference to the trading price of, or quotations for, the Common Stock, or (C) otherwise be issued in a transaction which constitutes a Variable Rate Transaction (as defined in the Purchase Agreement).
“Permitted Liens” means (i) any Lien for taxes not yet due or delinquent or being contested in good faith by appropriate proceedings for which adequate reserves have been established in accordance with generally accepted accounting principles, (ii) any statutory Lien arising in the ordinary course of business by operation of law with respect to a liability that is not yet due or delinquent, (iii) any Lien created by operation of law, such as materialmen’s liens, mechanics’ liens and other similar liens, arising in the ordinary course of business with respect to a liability that is not yet due or delinquent or that are being contested in good faith by appropriate proceedings, (iv) Liens upon or in any equipment acquired or held by the Corporation or any of its Subsidiaries securing Permitted Equipment Indebtedness, provided that the Lien is confined solely to the equipment financed thereby and improvements thereon, and the proceeds of such equipment, in either case, with respect to Indebtedness in an aggregate amount not to exceed Three Million Dollars ($3,000,000), (v) Liens incurred in connection with the extension, renewal or refinancing of the Indebtedness secured by Liens of the type described in clause (iv) above, provided that any extension, renewal or replacement Lien shall be limited to the property encumbered by the existing Lien and the principal amount of the Indebtedness being extended, renewed or refinanced does not increase, (vi) Liens in favor of customs and revenue authorities arising as a matter of law to secure payments of custom duties in connection with the importation of goods, (vii) Liens arising from judgments, decrees or attachments in circumstances not constituting a Trigger Event under Section 10(c)(iv), and (viii) Liens securing Indebtedness permitted under clause (iii) or (iv) of the definition of Permitted Indebtedness, provided that such Liens are confined solely to the assets of, and the equity interests in, the applicable acquired entity and its subsidiaries or Project Subsidiary, as the case may be.
“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.
“Price Failure” means, with respect to a particular date of determination, the VWAP of the Common Stock on any Trading Day during the twenty (20) Trading Day period ending on the Trading Day immediately preceding such date of determination fails to exceed $1.50 (as adjusted for stock splits, stock dividends, stock combinations, recapitalizations or other similar transactions). Notwithstanding the foregoing, upon written request from the Required Holders, the Corporation shall lower such dollar threshold at any time and for any period of time.
“Principal Market” means the Nasdaq Capital Market.
“Purchase Agreement” means that certain Securities Purchase Agreement, dated as of August 13, 2026, by and among the Corporation and the buyers party thereto, as amended.
“Redemption Amount” means the product of (i) the number of shares of Series C Preferred Stock being redeemed and (ii) the Per Share Redemption Price.
“Register” shall have the meaning set forth in Section 6(f).
“Registration Rights Agreement” means that certain registration rights agreement, dated as of August 13, 2026, by and among the Corporation and the buyers party thereto.
“Reporting Service” means either Bloomberg L.P. or FactSet Research Systems Inc., as determined by the Required Holders from time to time.
“Required Holders” shall have the meaning set forth in Section 4.
“Required Premium” means 125%.
“Required Reserve Amount” shall have the meaning set forth in Section 6(c)(iii).
“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Senior Preferred Stock” shall have the meaning set forth in Section 9.
“Series A Preferred Stock” means the Series A Convertible Preferred Stock, $0.0001 par value per share, of the Corporation.
“Series B Preferred Stock” means the Series B Convertible Preferred Stock, $0.0001 par value per share, of the Corporation.
“Series C Preferred Stock” shall have the meaning set forth in Section 2.
“Share Delivery Deadline” shall have the meaning set forth in Section 6(c)(i).
“Significant Subsidiary” means any Subsidiary that qualifies as a “significant subsidiary” pursuant to Rule 1-02 of Regulation S-X.
“Stated Value” shall have the meaning set forth in Section 2.
“Stockholder Approval” shall mean Effective Stockholder Approval as defined in the Purchase Agreement.
“Stockholder Approval Date” shall have the meaning as set forth in the Purchase Agreement.
“Subsidiary” means, as of any date of determination, any Person in which the Corporation directly or indirectly, (i) owns any of the outstanding share capital or holds any equity or similar interest of such Person or (ii) controls or operates all or any part of the business, operations or administration of such Person, and all of the foregoing, collectively.
“Subject Entity” means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.
“Trading Day” means a day on which the Principal Market (or, if the Common Stock, is not then listed or designated for quotation on the Principal Market, the Eligible Market on which the Common Stock is then listed or traded) is open for business.
“Transaction Documents” has the meaning set forth in the Purchase Agreement.
“Transfer Agent” means ClearTrust LLC, with an address at 16540 Pointe Village Dr, Ste 210, Lutz, Florida 33558 with a telephone number of (813) 235-4490, and any successor transfer agent of the Corporation.
“Trigger Event” shall have the meaning set forth in Section 10(c).
“Unavailable Conversion Shares” shall have the meaning set forth in Section 6(c)(ii).
“Volume Failure” means, with respect to a particular date of determination, the aggregate daily dollar trading volume (as reported on the Reporting Service) of the Common Stock on the Principal Market on any Trading Day during the twenty (20) Trading Day period ending on the Trading Day immediately preceding such date of determination is less than $500,000. Notwithstanding the foregoing, upon written request from the Required Holders, the Corporation shall lower such dollar threshold at any time and for any period of time.
“VWAP” means, for any security as of any date, the dollar volume-weighted average price for such security on the Principal Market (or, if the Principal Market is not the principal trading market for such security, then on the principal securities exchange or securities market on which such security is then traded), during the period beginning at 9:30:01 a.m., New York time, and ending at 4:00 p.m., New York time, as reported by the Reporting Service (set to 09:30:01 start time and 16:00 end time) or, if the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter market on the electronic bulletin board for such security during the period beginning at 9:30:01 a.m., New York time, and ending at 4:00 p.m., New York time, as reported by the Reporting Service, or, if no dollar volume-weighted average price is reported for such security by the Reporting Service for such hours, the average of the highest closing bid price and the lowest closing ask price of any of the market makers for such security as reported in The Pink Open Market (or a similar organization or agency succeeding to its functions of reporting prices). If the VWAP cannot be calculated for such security on such date on any of the foregoing bases, the VWAP of such security on such date shall be the fair market value as mutually determined by the Corporation and the Holder. If the Corporation and the Holder are unable to agree upon such fair market value within five (5) Trading Days, then such fair market value shall be determined by an independent, reputable appraiser jointly selected by the Corporation and the Holder, the determination of which shall be final and binding upon all parties absent manifest error, and the fees and expenses of which shall be borne by the Corporation.
Section 2. Designation, Amount, Stated Value and Par Value.
(a) General. The series of preferred stock shall be designated as its Series C Convertible Non-Voting Preferred Stock (the “Series C Preferred Stock”) and the number of shares so designated shall be 3,000,000 (which shall not be subject to increase without the written consent of all of the holders of the Series C Preferred Stock (each, a “Holder” and collectively, the “Holders”)). Each share of Series C Preferred Stock shall have a par value of $0.0001 per share and a stated value equal to $10.00 (as such stated value may be increased in accordance with the terms hereof, the “Stated Value”). The Corporation is the successor to NextNRG, Inc., a Delaware corporation (“Next-Delaware”), which converted to the Corporation as a Nevada corporation on September 30, 2026 and each outstanding share of Series C Convertible Non-Voting Preferred Stock of Next-Delaware was converted, by operation of such conversion, into shares of Series C Preferred Stock (such preferred stock of Next-Delaware, as designated in the State of Delaware on August 13, 2026 (the “Original Designation Date”).
(b) Stated Value Event. With respect to each share of Series C Preferred Stock, on the two (2) year anniversary of the Original Issuance Date of such share (the “Stated Value Event Date”), in the event of a Conversion Floor Price Condition, the Stated Value of such share shall automatically increase by ten percent (10%) of the then Stated Value of such share. Thereafter, on each successive one (1) month anniversary of such Stated Value Event Date, the Stated Value of such share shall automatically increase by ten percent (10%) of the then Stated Value of such share, multiplied by a fraction, the numerator of which is the number of calendar days during the immediately preceding monthly period on which a Conversion Floor Price Condition existed and the denominator of which is the number of calendar days in such monthly period. No action by any Holder shall be necessary to effect any increase in Stated Value pursuant to this Section 2(b).
Section 3. Dividends. Dividends shall accrue on each share of Series C Preferred Stock, on a daily basis commencing on the date of issuance of such share, at an annual rate equal to twelve and one half percent (12.5%) of the Stated Value of such share (computed on the basis of a 360-day year and actual days elapsed) and, to the extent accrued and unpaid, such dividends shall compound monthly. Such dividends shall be payable monthly in arrears, at the election of the Corporation, (A) in cash, (B), subject to there having been no Equity Conditions Failure as of the applicable payment date (unless waived in writing by the applicable Holder), and with written notice to each Holder on or prior to the tenth (10th) Trading Day prior to such payment date certifying that there has been no Equity Conditions Failure, in shares of Common Stock valued for such purpose at the Dividend Conversion Price (such shares, the “Dividend Shares”) on the first Trading Day of each calendar month (each, a “Dividend Date”) with the first such date being September 1, 2026, or (C) by increasing, pro rata, the Stated Value of such Holder’s shares of Series C Preferred Stock by the amount thereof on such Dividend Date; provided, however, that from and after the occurrence and during the continuance of any Mandatory Redemption Event or Trigger Event, the Corporation shall not be eligible to pay any dividends in shares of Common Stock. In addition, subject to the prior rights of holders of all classes of stock at the time outstanding having prior rights as to dividends, the holder of the Series C Preferred Stock shall be entitled to receive, when, as and if declared by the Board of Directors, out of any assets of the Corporation legally available therefor, such dividends as may be declared from time to time by the Board of Directors. Dividend Shares shall be delivered on the applicable Dividend Date in the manner set forth in Section 6(c)(i), and Section 6(c)(ii) shall apply to any failure to so deliver Dividend Shares as if such Dividend Date were the Share Delivery Deadline and such failure were a Conversion Failure. In addition, if the Corporation elects to pay any dividend in Dividend Shares and fails to deliver all of such Dividend Shares on the applicable Dividend Date, then, without any action by the applicable Holder and without limiting Section 6(c)(ii), the Stated Value of such Holder’s shares of Series C Preferred Stock shall automatically increase, pro rata, on such Dividend Date by the amount of the dividend attributable to such undelivered Dividend Shares, and the Corporation’s obligation to deliver such undelivered Dividend Shares shall thereupon terminate. From and after the occurrence and during the continuance of any Mandatory Redemption Event or Trigger Event (regardless of whether the Corporation has delivered notice thereof), the annual rate at which dividends accrue shall automatically be increased to the Default Rate; if such Mandatory Redemption Event or Trigger Event is subsequently cured (and no other Mandatory Redemption Event or Trigger Event then exists), such increase shall cease as of the day immediately following the date of such cure, provided that dividends accrued at such increased rate through the date of such cure shall continue to apply.
Section 4. Voting Rights. Shares of Series C Preferred Stock will not entitle any Holders thereof to any right to vote on matters on which the holders of shares of Common Stock are entitled to vote until and unless such Holder has converted such shares of Series C Preferred Stock into Conversion Shares. Notwithstanding the foregoing, so long as any shares of Series C Preferred Stock are outstanding, the Corporation shall not, without the affirmative vote of (x) for so long as the Lead Buyer (as defined in the Purchase Agreement) or any of its Affiliates holds any shares of Series C Preferred Stock, the Holders of a majority of the then-outstanding shares of Series C Preferred Stock, which majority must include the Lead Buyer, and (y) thereafter, the Holders of a majority of the then-outstanding shares of Series C Preferred Stock (excluding any shares of Series C Preferred Stock held by the Corporation or any of its Subsidiaries) (the “Required Holders”), (a) alter or change adversely the powers, preferences or rights given to the Series C Preferred Stock or alter or amend this Certificate of Designation, (b) amend the Articles of Incorporation or any other charter documents of the Corporation in any manner that adversely affects any rights of the Holders, in each case of clauses (a) and (b), regardless of whether any such action shall be by means of amendment to the Articles of Incorporation or this Certificate of Designation or by merger, consolidation, conversion or otherwise, (c) increase or decrease (other than by conversion or redemption) the authorized number of shares of Series C Preferred Stock, (d) whether or not prohibited by the terms hereof, circumvent a right of the Series C Preferred Stock hereunder or (e) enter into any agreement with respect to any of the foregoing.
Section 5. Liquidation. Upon any liquidation, dissolution or winding-up of the Corporation or such Subsidiaries the assets of which constitute all or substantially all of the assets of the business of the Corporation and its Subsidiaries, taken as a whole, whether voluntary or involuntary and whether in a single transaction or series of transactions (a “Liquidation”), the Holders shall be entitled to receive in cash out of the assets, whether capital or surplus, of the Corporation, before any amount shall be paid to the holders of any shares of capital stock of the Corporation junior in rank to the Series C Preferred Stock with respect to the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Corporation (collectively, “Junior Stock”), but pari passu with any Parity Stock then outstanding, the greater of the following amounts (the “Liquidation Funds”):
(a) the aggregate Stated Value of the shares of Series C Preferred Stock then outstanding, together with any and all accrued and unpaid dividends and any other amounts owed by the Corporation to the Holders pursuant to this Certificate of Designation or any other Transaction Document not included in such Stated Value; or
(b) the amount the Holders would be entitled to receive if the shares of Series C Preferred Stock were fully converted (disregarding for such purposes any conversion limitations hereunder) into Conversion Shares at the Alternate Conversion Price then in effect;
provided that if the assets of the Corporation available for distribution are insufficient to pay the Liquidation Funds in full to the Holders and the full liquidation preference payable to the holders of shares of Parity Stock (in accordance with their respective certificate of designation (or equivalent)), then each Holder and each holder of Parity Stock shall receive a percentage of such assets equal to the Liquidation Funds or liquidation preference payable to such Holder or holder as a percentage of the aggregate Liquidation Funds and liquidation preferences payable to all Holders and all holders of shares of Parity Stock.
To the extent necessary, the Corporation shall cause such actions to be taken by each of its Subsidiaries so as to enable, to the maximum extent permitted by law, the proceeds of a Liquidation to be distributed to the Holders in accordance with this Section 5. All the preferential amounts to be paid to the Holders under this Section 5 shall be paid or set apart for payment before the payment or setting apart for payment of any amount for, or the distribution of any Liquidation Funds or other assets of the Corporation to, the holders of shares of Junior Stock in connection with a Liquidation as to which this Section 5 applies.
The Corporation shall provide written notice of any such Liquidation by facsimile or email, not less than forty-five (45) days prior to the payment date stated therein, to each Holder.
Section 6. Conversion.
(a) Conversions at Option of Holder. Each share of Series C Preferred Stock shall be convertible, at any time and from time to time on or after the applicable Original Issuance Date, at the option of the Holder thereof, into that number of Conversion Shares (subject to the limitations set forth in Section 6(e)) determined by dividing (i) the Conversion Amount with respect to such shares of Series C Preferred Stock by (ii) the Conversion Price. Holders shall effect conversions of Series C Preferred Stock by providing the Corporation with the form of conversion notice attached hereto as Annex A (a “Notice of Conversion”). Each Notice of Conversion shall specify the number of shares of Series C Preferred Stock to be converted, the number of shares of Series C Preferred Stock owned prior to the conversion at issue, the number of shares of Series C Preferred Stock owned subsequent to the conversion at issue, the number of Conversion Shares to be issued, the applicable Conversion Price and the date on which such conversion is to be effected, which date may not be prior to the date the applicable Holder delivers by facsimile or email such Notice of Conversion to the Corporation (such date, the “Conversion Date”). If no Conversion Date is specified in a Notice of Conversion, the Conversion Date shall be the date that such Notice of Conversion to the Corporation is deemed delivered hereunder. No ink-original Notice of Conversion shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Conversion form be required. The calculations and entries set forth in the Notice of Conversion shall control in the absence of manifest or mathematical error. To effect conversions of shares of Series C Preferred Stock, a Holder shall not be required to surrender any certificate(s), if applicable, representing the shares of Series C Preferred Stock to the Corporation unless all of the shares of Series C Preferred Stock represented thereby are so converted, in which case such Holder shall deliver the certificate, if any, representing such shares of Series C Preferred Stock promptly following the Conversion Date at issue, if applicable.
(b) Conversion Price. The conversion price for the Series C Preferred Stock shall equal either (i) $7.50 for all shares of Series C Preferred Stock with an Original Issuance Date of August 13, 2026 and (ii) for shares of Series C Preferred Stock with an Original Issuance Date after August 13, 2026, the greater of (A) the Floor Price and (B) 150% of the lower of (x) the closing price of the shares of Common Stock as reported by the Principal Market (the “Official Closing Price”) on the Trading Day immediately prior to the issuance date of such shares of Series C Preferred Stock and (y) the average Official Closing Price of the Common Stock for the five Trading Days immediately preceding the issuance date of such shares of Series C Preferred Stock (the “Conversion Price”). The Conversion Price shall be subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Stock that occur after the applicable issuance date as set forth in Section 7 hereof. The Conversion Price shall be rounded up to the nearest $0.0001. The Conversion Price set forth in clause (i) above and each other per share price and number of shares set forth in this Certificate of Designation (other than the 10,000,000 shares referred to in Section 6(g)) give effect to the 1-for-10 reverse stock split of the Common Stock effected on September 14, 2026 (the “2026 Reverse Split”) and shall not be further adjusted for the 2026 Reverse Split pursuant to Section 7, Section 9(l) of the Purchase Agreement or otherwise.
(c) Mechanics of Conversion. Prior to the receipt of the applicable Stockholder Approval, all conversions pursuant to this Section 6(c) and Section 6(d) shall be subject to the Exchange Cap.
(i) Delivery of Conversion Shares Upon Conversion. On the date of receipt of a Notice of Conversion, the Corporation shall transmit by electronic mail an acknowledgment, in the form attached hereto as Annex B, of confirmation of receipt of such Notice of Conversion and representation as to whether such shares of Common Stock may then be resold pursuant to Rule 144 or an effective and available registration statement (each, an “Acknowledgement”) to the Holder and the Transfer Agent which confirmation shall constitute an instruction to the Transfer Agent to process such Notice of Conversion in accordance with the terms herein. The Corporation’s failure to timely deliver an Acknowledgement shall not limit, delay or otherwise impair any Holder’s right to receive the applicable Conversion Shares on or prior to the applicable Share Delivery Deadline. On or before the first (1st) Trading Day following the date on which the Corporation has received a Notice of Conversion (or such earlier date as required pursuant to the Exchange Act or other applicable law, rule or regulation for the settlement of a trade initiated on the applicable Conversion Date of such shares of Common Stock issuable pursuant to such Notice of Conversion) (the “Share Delivery Deadline”) the Corporation shall (1) provided that the Transfer Agent is participating in FAST and such shares of Common Stock are eligible to be issued without a restricted legend at such time to the Holder pursuant to applicable securities laws (the “Free Tradability Condition”), credit such aggregate number of shares of Common Stock to which the Holder shall be entitled pursuant to such conversion to the Holder’s or its designee’s balance account with DTC through its Deposit/Withdrawal at Custodian system or (2) if the Transfer Agent is not participating in FAST or the Free Tradability Condition is not satisfied, upon the request of the Holder, issue and deliver (via reputable overnight courier) to the address as specified in the Notice of Conversion, a certificate, registered in the name of the Holder or its designee, for the number of shares of Common Stock to which the Holder shall be entitled pursuant to such conversion. Notwithstanding anything to the contrary contained in this Certificate of Designation or the Registration Rights Agreement, after the effective date of the Registration Statement (as defined in the Registration Rights Agreement) and prior to the Holder’s receipt of the notice of a Grace Period (as defined in the Registration Rights Agreement), the Corporation shall cause the Transfer Agent to deliver unlegended shares of Common Stock to the Holder (or its designee) in connection with any sale of Conversion Shares with respect to which the Holder has entered into a contract for sale, and delivered a copy of the prospectus included as part of the particular Registration Statement to the extent applicable, and for which the Holder has not yet settled.
(ii) Failure to Deliver Conversion Shares. If the Corporation shall fail, for any reason or for no reason, on or prior to the applicable Share Delivery Deadline, either (I) if the Transfer Agent is not participating in FAST or the Free Tradability Condition is not satisfied, to issue and deliver to the Holder (or its designee) a certificate for the number of shares of Common Stock to which the Holder is entitled and register such shares of Common Stock on the Corporation’s share register or, if the Transfer Agent is participating in FAST and the Free Tradability Condition is satisfied, to credit the balance account of the Holder or the Holder’s designee with DTC for such number of shares of Common Stock to which the Holder is entitled upon the Holder’s conversion of shares of Series C Preferred Stock (as the case may be) or (II) if the Registration Statement covering the resale of the shares of Common Stock that are the subject of the Notice of Conversion (the “Unavailable Conversion Shares”) is not available for the resale of such Unavailable Conversion Shares and the Corporation fails to promptly, but in no event later than as required pursuant to the Registration Rights Agreement (x) so notify the Holder and (y) deliver the shares of Common Stock electronically without any restrictive legend by crediting such aggregate number of shares of Common Stock to which the Holder is entitled pursuant to such conversion to the Holder’s or its designee’s balance account with DTC through its Deposit/Withdrawal At Custodian system (the event described in the immediately foregoing clause (II) is hereinafter referred as a “Notice Failure” and together with the event described in clause (I) above, a “Conversion Failure”), then, in addition to all other remedies available to the Holder, (1) the Corporation shall pay in cash to the Holder on each day after such Share Delivery Deadline that the issuance of such shares of Common Stock is not timely effected an amount equal to 1.5% of the product of (A) the sum of the number of shares of Common Stock not issued to the Holder on or prior to the applicable Share Delivery Deadline and to which the Holder is entitled, multiplied by (B) any trading price of the Common Stock selected by the Holder in writing as in effect at any time during the period beginning on the applicable Conversion Date and ending on the applicable Share Delivery Deadline and (2) the Holder, upon written notice to the Corporation, may void its Notice of Conversion with respect to, and retain or have returned (as the case may be) any portion of such Holder’s shares of Series C Preferred Stock that have not been converted pursuant to such Notice of Conversion, provided that the voiding of a Notice of Conversion shall not affect the Corporation’s obligations to make any payments which have accrued prior to the date of such notice pursuant to this Section 6(c)(ii) or otherwise. In addition to the foregoing, if on or prior to the Share Delivery Deadline either (A) if the Transfer Agent is not participating in FAST or the Free Tradability Condition is not satisfied, the Corporation shall fail to issue and deliver to the Holder (or its designee) a certificate and register such shares of Common Stock on the Corporation’s share register or, if the Transfer Agent is participating in FAST and the Free Tradability Condition is satisfied, the Transfer Agent shall fail to credit the balance account of the Holder or the Holder’s designee with DTC for the number of shares of Common Stock to which the Holder is entitled upon the Holder’s conversion hereunder or pursuant to the Corporation’s obligation pursuant to clause (II) below or (B) a Notice Failure occurs, and if on or after such Share Delivery Deadline the Holder acquires (in an open market transaction, stock loan or otherwise) shares of Common Stock corresponding to all or any portion of the number of shares of Common Stock issuable upon such conversion that the Holder is entitled to receive from the Corporation and has not received from the Corporation in connection with such Conversion Failure or Notice Failure, as applicable (a “Buy-In”), then, in addition to all other remedies available to the Holder, the Corporation shall, within one (1) Business Day after receipt of the Holder’s request and in the Holder’s discretion, either: (I) pay cash to the Holder in an amount equal to the Holder’s total purchase price (including brokerage commissions, stock loan costs and other out-of-pocket expenses, if any) for the shares of Common Stock so acquired (including, without limitation, by any other Person in respect, or on behalf, of the Holder) (the “Buy-In Price”), at which point the Corporation’s obligation to so issue and deliver such certificate (and to issue such shares of Common Stock) or credit the balance account of such Holder or such Holder’s designee, as applicable, with DTC for the number of shares of Common Stock to which the Holder is entitled upon the Holder’s conversion hereunder (as the case may be) (and to issue such shares of Common Stock) shall terminate, or (II) promptly honor its obligation to so issue and deliver to the Holder a certificate or certificates representing such shares of Common Stock or credit the balance account of such Holder or such Holder’s designee, as applicable, with DTC for the number of shares of Common Stock to which the Holder is entitled upon the Holder’s conversion hereunder (as the case may be) and pay cash to the Holder in an amount equal to the excess (if any) of the Buy-In Price over the product of (x) such number of shares of Common Stock multiplied by (y) the lowest closing sale price of the Common Stock on any Trading Day during the period commencing on the date of the applicable Notice of Conversion and ending on the date of such issuance and payment under this clause (II) (the “Buy-In Payment Amount”). Nothing shall limit the 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 Corporation’s failure to timely deliver certificates representing shares of Common Stock (or to electronically deliver such shares of Common Stock) upon the conversion of shares of Series C Preferred Stock as required pursuant to the terms hereof.
(iii) Reservation of Shares Issuable Upon Conversion. The Corporation covenants that it will at all times reserve and keep available out of its authorized and unissued shares of Common Stock for the sole purpose of issuance upon conversion of the Series C Preferred Stock as herein provided, free from preemptive rights or any other actual or contingent purchase rights of Persons other than the Holder (and the other holders of the Series C Preferred Stock), not less than 150% of the maximum aggregate number of shares of Common Stock issuable upon conversion (including, without limitation, Alternate Conversions) of all shares of Series C Preferred Stock then outstanding or issuable pursuant to the Purchase Agreement (assuming for purposes hereof that (x) such shares of Series C Preferred Stock are convertible at the Floor Price as of such applicable date of determination, (y) dividends on such shares of Series C Preferred Stock shall accrue through the second (2nd) anniversary of the Original Issuance Date of such shares and will be converted into shares of Common Stock at a conversion price equal to the Floor Price as of such applicable date of determination and (z) any such conversion shall not take into account any limitations on the conversion of the Series C Preferred Stock set forth herein) (the “Required Reserve Amount”). The Required Reserve Amount shall be allocated pro rata among the Holders based on the Stated Value of the shares of Series C Preferred Stock held by each Holder (the “Authorized Share Allocation”), and any shares so reserved and allocated to any Person which ceases to hold any Series C Preferred Stock shall be allocated to the remaining Holders pro rata. Notwithstanding the foregoing, a Holder may allocate its Authorized Share Allocation to any other of the securities of the Corporation held by such Holder (or any of its designees) by delivery of a written notice to the Corporation. The Corporation covenants that all shares of Common Stock that shall be so issuable shall, upon issue, be duly authorized, validly issued, fully paid and nonassessable. If at any time the Corporation does not have a sufficient number of authorized and unreserved shares of Common Stock to reserve the Required Reserve Amount (an “Authorized Share Failure”), the Corporation shall immediately take all corporate action necessary to authorize and reserve a sufficient number of shares of Common Stock to meet the Required Reserve Amount, including, without limitation, holding a meeting of its stockholders no later than forty (40) days after the occurrence of such Authorized Share Failure (or, if a majority of the voting power of the Corporation’s capital stock consents, obtaining such consent no later than fifteen (15) days after the occurrence of such Authorized Share Failure and filing an information statement on Schedule 14C), using its best efforts to solicit such approval and to cause the Board of Directors to recommend it, and voting all management shares of the Corporation in favor of an increase in the authorized shares of Common Stock. If the Corporation is prohibited from issuing shares of Common Stock upon any conversion due to an Authorized Share Failure (such shares, the “Authorized Failure Shares”), in lieu of delivering such Authorized Failure Shares the Corporation shall redeem, at the Corporation’s option either (A) in cash, or (B) by increasing, pro rata, the Stated Value of such Holder’s shares of Series C Preferred Stock in an aggregate amount equal to the amount that would be delivered in cash, the portion of the Conversion Amount convertible into such Authorized Failure Shares at a price equal to the sum of (i) the product of (x) such number of Authorized Failure Shares and (y) the greatest Official Closing Price on any Trading Day during the period commencing on the date the Holder delivers the applicable Notice of Conversion and ending on the date of such issuance and payment and (ii) to the extent the Holder purchases shares of Common Stock to deliver in satisfaction of a sale by the Holder of Authorized Failure Shares, any brokerage commissions and other out-of-pocket expenses of the Holder incurred in connection therewith.
(iv) Fractional Shares. No fractional shares or scrip representing fractional shares shall be issued upon the conversion of the Series C Preferred Stock. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such conversion, the Corporation shall round up to the next whole share. Notwithstanding anything to the contrary contained herein, but consistent with the provisions of this subsection with respect to fractional Conversion Shares, nothing shall prevent any Holder from converting fractional shares of Series C Preferred Stock.
(v) Transfer Taxes and Expenses. The issuance of Conversion Shares upon the conversion of the Series C Preferred Stock, shall be made without charge to any Holder for any transfer, stamp, issuance or similar taxes, costs or expenses that may be payable in respect of the issue or delivery of such Conversion Shares. The Corporation shall pay all Transfer Agent fees required for same-day processing of any Notice of Conversion and all fees to the Depository Trust Corporation (or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Conversion Shares.
(d) Right of Alternate Conversion.
(i) Alternate Optional Conversion. Subject to Section 6(e), at any time, at the option of any Holder, such Holder may convert (each, an “Alternate Conversion”, and the date of such Alternate Conversion, an “Alternate Conversion Date”) all, or any number, of shares of Series C Preferred Stock into shares of Common Stock (such aggregate Conversion Amount of the shares of Series C Preferred Stock to be converted pursuant to this Section 6(d)(i), the “Alternate Conversion Amount”) at the Alternate Conversion Price.
(ii) Mechanics of Alternate Conversion. On any Alternate Conversion Date, a Holder may voluntarily convert any number of shares of Series C Preferred Stock held by such Holder pursuant to Section 6(c) (with “Alternate Conversion Price” replacing “Conversion Price” for all purposes hereunder with respect to such Alternate Conversion and, if a Mandatory Redemption Event or a Trigger Event has occurred as of the applicable Alternate Conversion Date, with “120% of the Conversion Amount” replacing “Conversion Amount”) by designating in the Notice of Conversion delivered pursuant to this Section 6(d) of this Certificate of Designation that such Holder is electing to use the Alternate Conversion Price for such conversion; provided that in the event of a Conversion Floor Price Condition, the Corporation shall deliver the applicable Alternate Conversion Floor Amount to such Holder in cash on the applicable Alternate Conversion Date or, at the option of the Corporation, effect a Conversion Floor Price Deferral with respect to such amount. Notwithstanding anything to the contrary in this Section 6(d), but subject to Section 6(e), until the Corporation delivers to such Holder the shares of Common Stock to which such Holder is entitled pursuant to the applicable Alternate Conversion of such Holder’s shares of Series C Preferred Stock, such shares of Series C Preferred Stock may be converted by such Holder into shares of Common Stock pursuant to Section 6(c) without regard to this Section 6(d). In the event of an Alternate Conversion pursuant to this Section 6(d) of all, or any portion, of any shares of Series C Preferred Stock of a Holder, such Holder’s damages would be uncertain and difficult to estimate because of the parties’ inability to predict future interest rates and the uncertainty of the availability of a suitable substitute investment opportunity for such Holder. Accordingly, any redemption premium due under this Section 6(d)(ii), together with the Alternate Conversion Price used in such Alternate Conversion, as applicable, is intended by the parties to be, and shall be deemed, a reasonable estimate of, such Holder’s actual loss of its investment opportunity and not as a penalty.
(iii) Reservation Notice; Reservation Shares; Reservation Conversion Price. Notwithstanding anything herein to the contrary, at any time a Holder’s shares of Series C Preferred Stock (without regard to Section 6(e)) would be convertible into more than the Beneficial Ownership Limitation (each such excess share of Common Stock, a “Reservation Eligible Share”), such Holder may, by delivery of written notice to the Corporation (which may be an e-mail) (each, a “Reservation Notice”, and each time of such delivery, a “Reservation Determination Time”), solely with respect to the Reservation Eligible Shares specified therein (the “Reservation Shares”), elect for the Alternate Conversion Price of such Reservation Shares as of such Reservation Determination Time to remain available to such Holder for future Alternate Conversions of such Reservation Shares (each, a “Reservation Conversion Price”); provided, that if such Holder delivers more than one Reservation Notice with respect to any Reservation Eligible Share, the lowest applicable Alternate Conversion Price as of the applicable Reservation Determination Times shall be the Reservation Conversion Price; provided further, that such Holder may, by written notice to the Corporation (which may be an e-mail), withdraw any Reservation Notice, in whole or in part, at any time.
(e) Beneficial Ownership Limitation. The Corporation shall not effect any conversion of the Series C Preferred Stock, and a Holder shall not have the right to convert any portion of the Series C Preferred Stock, to the extent that, after giving effect to the conversion set forth on the applicable Notice of Conversion, such Holder (together with the other Attribution Parties) 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 such Holder and its Affiliates and Attribution Parties shall include the number of shares of Common Stock issuable upon conversion of the Series C Preferred Stock 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 Stated Value of Series C Preferred Stock beneficially owned by such Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or unconverted portion of any other securities of the Corporation subject to a limitation on conversion or exercise analogous to the limitation contained herein (including, without limitation, the Series C Preferred Stock) beneficially owned by such Holder or any of its Affiliates or Attribution Parties. Except as set forth in the preceding sentence, for purposes of this Section 6(e), 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(e) applies, the determination of whether the Series C Preferred Stock is convertible (in relation to other securities owned by such Holder together with any Affiliates and Attribution Parties) and of how many shares of Series C Preferred Stock are convertible shall be in the sole discretion of such Holder, and the submission of a Notice of Conversion shall be deemed to be such Holder’s determination of whether the shares of Series C Preferred Stock may be converted (in relation to other securities owned by such Holder together with any Affiliates and Attribution Parties) and how many shares of the Series C Preferred Stock are convertible, in each case subject to the Beneficial Ownership Limitation. To ensure compliance with this restriction, each Holder will be deemed to represent to the Corporation 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 Corporation 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(e), in determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common Stock as stated in the most recent of the following: (i) the Corporation’s most recent periodic or annual report filed with the Commission, as the case may be, (ii) a more recent public announcement by the Corporation or (iii) a more recent written notice by the Corporation or the Transfer Agent setting forth the number of shares of Common Stock outstanding. Upon the written or oral request (which may be via email) of a Holder, the Corporation shall within two (2) Trading Days confirm orally and in writing to such 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 Corporation, including the Series C Preferred Stock, by such Holder or its Affiliates or Attribution Parties since the date as of which such number of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation” shall be 4.99% (or, upon election by a Holder prior to the issuance of any shares of Series C Preferred Stock, 9.99%) of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of the Conversion Shares to the applicable Holder. A Holder, upon notice to the Corporation, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 6(e) applicable to its Series C Preferred Stock 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 the Conversion Shares to the Holder and the provisions of this Section 6(e) shall continue to apply. Any such increase in the Beneficial Ownership Limitation will not be effective until the 61st day after such notice is delivered to the Corporation and shall only apply to such Holder and no other Holder. If the Corporation receives a Notice of Conversion at a time when the actual number of outstanding shares of Common Stock is less than the number relied upon by the Holder pursuant to this Section 6(e), the Corporation shall notify the Holder in writing of the number of shares of Common Stock then outstanding and, to the extent that such Notice of Conversion would otherwise cause the Holder’s beneficial ownership to exceed the Beneficial Ownership Limitation, the Holder shall notify the Corporation of a reduced number of Conversion Shares to be issued pursuant to such Notice of Conversion. If the issuance of shares of Common Stock to a Holder upon conversion results in such Holder and the other Attribution Parties being deemed to beneficially own, in the aggregate, more than the Beneficial Ownership Limitation (as determined under Section 13(d) of the Exchange Act), the number of shares so issued in excess of the Beneficial Ownership Limitation (the “Excess Shares”) shall be deemed null and void and shall be cancelled ab initio, and such Holder shall not have the power to vote or to transfer the Excess Shares. The shares of Common Stock issuable to a Holder in excess of the Beneficial Ownership Limitation shall not be deemed to be beneficially owned by such Holder for any purpose, including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the Exchange Act, and each Holder shall be deemed to have waived any voting rights of Conversion Shares during the period from the applicable Conversion Date through the applicable Share Delivery Deadline to the extent necessary so that the aggregate voting rights of the shares of Common Stock beneficially owned by such Holder and the other Attribution Parties do not exceed the Beneficial Ownership Limitation. The provisions of this paragraph shall not be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 6(e) 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 may not be amended, modified or waived and shall apply to a successor holder of Series C Preferred Stock.
(f) Registration; Book-Entry. At the time of issuance of any shares of Series C Preferred Stock, the applicable Holder shall receive such shares of Series C Preferred Stock in book-entry form unless the Holder requests by written request (including by electronic-mail) to the Corporation to receive such shares of Series C Preferred Stock in the form of one or more stock certificates. The Corporation or the Transfer Agent shall maintain a register (the “Register”) for the recordation of the names and addresses of the Holders of each share of Series C Preferred Stock and the Stated Value and Conversion Price of such shares of Series C Preferred Stock and whether such shares of Series C Preferred Stock are held by such Holder in certificate or in book-entry form. The entries in the Register shall be conclusive and binding for all purposes absent manifest error. The Corporation and each Holder shall treat each Person whose name is recorded in the Register as the owner of such shares of Series C Preferred Stock for all purposes notwithstanding notice to the contrary. A registered share of Series C Preferred Stock may be assigned, transferred or sold only by registration of such assignment or sale on the Register. Upon its receipt of a written request to assign, transfer or sell one or more registered shares of Series C Preferred Stock by such Holder thereof and, if requested by the Corporation, an opinion of counsel reasonably satisfactory to the Corporation, the Corporation or Transfer Agent, as applicable, shall record the information contained therein in the Register and issue one or more new registered shares of Series C Preferred Stock in the same aggregate Stated Value and Conversion Price as the Stated Value of the surrendered registered shares of Series C Preferred Stock to the designated assignee or transferee; provided that if the Corporation or the Transfer Agent does not so record an assignment, transfer or sale within two (2) Business Days of such a request, the Register shall be automatically deemed updated to reflect such assignment, transfer or sale. Shares of Series C Preferred Stock may be offered, sold, assigned or transferred by a Holder without the consent of the Corporation, subject only to compliance with applicable securities laws and Section 2(g) of the Purchase Agreement.
(g) Primary Market Limitation. Notwithstanding anything in this Certificate of Designation to the contrary, the Corporation shall not issue any shares of Common Stock upon conversion of shares of Series C Preferred Stock, or otherwise, if the issuance of such shares of Common Stock, together with the Corporation’s May 2026 issuance of 10,000,000 shares of Common Stock (on a pre-2026 Reverse Split basis), the issuance of shares of Common Stock upon the conversion of any shares of Series C Preferred Stock issuable pursuant to the Purchase Agreement and with any other related transactions that may be considered part of the same series of transactions, would exceed the aggregate number of shares of Common Stock that the Corporation may issue in a transaction in compliance with the Corporation’s obligations under the rules or regulations of the Principal Market and shall be referred to as the “Exchange Cap,” except that such limitation shall not apply on and after the Stockholder Approval Date (or, with respect to shares of Common Stock issuable upon conversion of shares of Series C Preferred Stock with an Original Issuance Date of August 13, 2026, at any time after the Effective Stockholder Approval (as defined in the Purchase Agreement) obtained in connection with the Initial Closing (as defined in the Purchase Agreement)). If the Corporation fails or is unable to effect any conversion of Series C Preferred Stock (in whole or in part) by reason of this Section 6(g), the Corporation shall redeem, either (A) in cash, (B), subject to there having been no Equity Conditions Failure as of the applicable payment date (unless waived in writing by the applicable Holder), and with written notice to each Holder on or prior to the tenth (10th) Trading Day prior to such payment date certifying that there has been no Equity Conditions Failure, in shares of Common Stock valued at the lower of the applicable Conversion Price and the Alternate Conversion Price in effect on the applicable payment date (solely to the extent such shares may be issued without exceeding the Exchange Cap), or (C) by increasing, pro rata, the Stated Value of such Holder’s shares of Series C Preferred Stock in the aggregate amount that would be issued in cash pursuant to clause (A) of Section 6(g) hereof, within three (3) Business Days after such Conversion Failure, all or any portion of the Conversion Amount that the Corporation is so unable to convert at a price equal to the product of the Required Premium multiplied by such Conversion Amount.
Section 7. Certain Adjustments.
(a) Stock Dividends and Stock Splits. If the Corporation, at any time while the Series C Preferred Stock is outstanding: (i) pays a stock dividend or otherwise makes a distribution or distributions payable in shares of Common Stock on shares of Common Stock or any other Common Stock Equivalents, (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of a reverse stock split) outstanding shares of Common Stock into a smaller number of shares, or (iv) issues, in the event of a reclassification of shares of the Common Stock, any shares of capital stock of the Corporation, 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 Corporation) 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 7(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. Notwithstanding the foregoing, the Corporation shall not declare and pay a stock dividend or otherwise make a distribution or distributions payable in shares of Common Stock on shares of Common Stock or any other Common Stock Equivalent if an Equity Conditions Failure exists and for so long as such Equity Conditions Failure continues.
(b) Dilutive Issuance. If and whenever on or after the Original Designation Date the Corporation grants, issues or sells (or enters into any agreement to grant, issue or sell), or in accordance with this Section 7(b) is deemed to have granted, issued or sold, any shares of Common Stock (including the granting, issuance or sale of shares of Common Stock owned or held by or for the account of the Corporation, but excluding any Excluded Securities granted, issued or sold or deemed to have been granted, issued or sold) for a consideration per share (the “New Issuance Price”) less than a price equal to the Conversion Price in effect immediately prior to such granting, issuance or sale or deemed granting, issuance or sale (such Conversion Price then in effect is referred to herein as the “Applicable Price”) (the foregoing a “Dilutive Issuance”), then, immediately after such Dilutive Issuance, the Conversion Price then in effect shall be reduced to an amount equal to the New Issuance Price. For all purposes of the foregoing (including, without limitation, determining the adjusted Conversion Price and the New Issuance Price under this Section 7(b)), the following shall be applicable:
(i) Issuance of Options. If the Corporation in any manner grants, issues or sells (or enters into any agreement to grant, issue or sell) any Options and the lowest price per share for which one share of Common Stock is at any time issuable upon the exercise of any such Option or upon conversion, exercise or exchange of any Common Stock Equivalents issuable upon exercise of any such Option or otherwise pursuant to the terms thereof is less than the Applicable Price, then such share of Common Stock shall be deemed to be outstanding and to have been issued and sold by the Corporation at the time of the granting, issuance or sale of such Option for such price per share. For purposes of this Section 7(b)(i), the “lowest price per share for which one share of Common Stock is at any time issuable upon the exercise of any such Option or upon conversion, exercise or exchange of any Common Stock Equivalents issuable upon exercise of any such Option or otherwise pursuant to the terms thereof” shall be equal to (1) the lower of (x) the sum of the lowest amounts of consideration (if any) received or receivable by the Corporation with respect to any one share of Common Stock upon the granting, issuance or sale of such Option, upon exercise of such Option and upon conversion, exercise or exchange of any Common Stock Equivalent issuable upon exercise of such Option or otherwise pursuant to the terms thereof and (y) the lowest exercise price set forth in such Option for which one share of Common Stock is issuable (or may become issuable assuming all possible market conditions) upon the exercise of any such Options or upon conversion, exercise or exchange of any Common Stock Equivalent issuable upon exercise of any such Option or otherwise pursuant to the terms thereof, minus (2) the sum of all amounts paid or payable to the holder of such Option (or any other Person) with respect to any one share of Common Stock upon the granting, issuance or sale of such Option, upon exercise of such Option and upon conversion, exercise or exchange of any Common Stock Equivalent issuable upon exercise of such Option or otherwise pursuant to the terms thereof plus the value of any other consideration (including, without limitation, consideration consisting of cash, debt forgiveness, assets or any other property) received or receivable by, or benefit conferred on, the holder of such Option (or any other Person). Except as contemplated below, no further adjustment of the Conversion Price shall be made upon the actual issuance of such share of Common Stock or of such Common Stock Equivalents upon the exercise of such Options or otherwise pursuant to the terms thereof or upon the actual issuance of such shares of Common Stock upon conversion, exercise or exchange of such Common Stock Equivalent.
(ii) Issuance of Common Stock Equivalents. If the Corporation in any manner issues or sells (or enters into any agreement to issue or sell) any Common Stock Equivalents and the lowest price per share for which one share of Common Stock is at any time issuable upon the conversion, exercise or exchange thereof or otherwise pursuant to the terms thereof is less than the Applicable Price, then such share of Common Stock shall be deemed to be outstanding and to have been issued and sold by the Corporation at the time of the issuance or sale (or the time of execution of such agreement to issue or sell, as applicable) of such Common Stock Equivalents for such price per share. For the purposes of this Section 7(b)(ii), the “lowest price per share for which one share of Common Stock is at any time issuable upon the conversion, exercise or exchange thereof or otherwise pursuant to the terms thereof” shall be equal to (1) the lower of (x) the sum of the lowest amounts of consideration (if any) received or receivable by the Corporation with respect to one share of Common Stock upon the issuance or sale (or pursuant to the agreement to issue or sell, as applicable) of the Common Stock Equivalents and upon conversion, exercise or exchange of such Common Stock Equivalent or otherwise pursuant to the terms thereof and (y) the lowest conversion price set forth in such Common Stock Equivalent for which one share of Common Stock is issuable (or may become issuable assuming all possible market conditions) upon conversion, exercise or exchange thereof or otherwise pursuant to the terms thereof minus (2) the sum of all amounts paid or payable to the holder of such Common Stock Equivalent (or any other Person) with respect to any one share of Common Stock upon the issuance or sale (or the agreement to issue or sell, as applicable) of such Common Stock Equivalent plus the value of any other consideration received or receivable (including, without limitation, any consideration consisting of cash, debt forgiveness, assets or other property) by, or benefit conferred on, the holder of such Common Stock Equivalents (or any other Person). Except as contemplated below, no further adjustment of the Conversion Price shall be made upon the actual issuance of such shares of Common Stock upon conversion, exercise or exchange of such Common Stock Equivalent or otherwise pursuant to the terms thereof, and if any such issuance or sale of such Common Stock Equivalents is made upon exercise of any Options for which adjustment of the Conversion Price has been or is to be made pursuant to other provisions of this Section 7(b)(ii), except as contemplated below, no further adjustment of the Conversion Price shall be made by reason of such issuance or sale.
(iii) Change in Option Price or Rate of Conversion. If the purchase or exercise price provided for in any Options, the additional consideration, if any, payable upon the issue, conversion, exercise or exchange of any Common Stock Equivalents, or the rate at which any Common Stock Equivalents are convertible into or exercisable or exchangeable for shares of Common Stock increases or decreases at any time (other than proportional changes in conversion or exercise prices, as applicable, in connection with an event referred to in Section 7(a) above), the Conversion Price in effect at the time of such increase or decrease shall be adjusted to the Conversion Price which would have been in effect at such time had such Options or Common Stock Equivalent provided for such increased or decreased purchase price, additional consideration or increased or decreased conversion rate (as the case may be) at the time initially granted, issued or sold. For purposes of this Section 7(b)(iii), if the terms of any Option or Common Stock Equivalent (including, without limitation, any Option or Common Stock Equivalent that was outstanding as of the issuance date) are increased or decreased in the manner described in the immediately preceding sentence, then such Option or Common Stock Equivalent and the shares of Common Stock deemed issuable upon exercise, conversion or exchange thereof shall be deemed to have been issued as of the date of such increase or decrease. No adjustment pursuant to this Section 7(b) shall be made if such adjustment would result in an increase of the Conversion Price then in effect.
(iv) Calculation of Consideration Received. If any Option and/or Common Stock Equivalent and/or Adjustment Right is issued in connection with the issuance or sale or deemed issuance or sale of any other securities of the Corporation (as determined by the Holder, the “Primary Security”, and such Option and/or Common Stock Equivalent and/or Adjustment Right, the “Secondary Securities” and together with the Primary Security, each a “Unit”), together comprising one integrated transaction (or one or more transactions if such issuances or sales or deemed issuances or sales of securities of the Corporation either (A) have at least one investor or purchaser in common, (B) are consummated in reasonable proximity to each other and/or (C) are consummated under the same plan of financing), the aggregate consideration per share of Common Stock with respect to such Primary Security shall be deemed to be the lower of (x) the purchase price of such Unit minus, with respect to the Secondary Securities, the sum of (I) the Black Scholes Consideration Value of each such Option, if any, (II) the fair market value (as determined by the Holder in good faith) or the Black Scholes Consideration Value, as applicable, of each such Adjustment Right, if any, and (III) the fair market value (as determined by the Holder in good faith) of each such Common Stock Equivalent, if any, in each case determined on a per share basis, (y) if such Primary Security is an Option and/or Common Stock Equivalent, the lowest price per share for which one share of Common Stock is at any time issuable upon the exercise or conversion of the Primary Security in accordance with Section 7(b)(i) or 7(b)(ii) above and (z) the average VWAP of the Common Stock on any Trading Day during the five (5) Trading Day period (the “Adjustment Period”) immediately following the public announcement of such Dilutive Issuance (for the avoidance of doubt, if such public announcement is released prior to the opening of the Principal Market on a Trading Day, such Trading Day shall be the first Trading Day in such five Trading Day period and if any shares of Series C Preferred Stock are converted, on any given Conversion Date during any such Adjustment Period, solely with respect to such number of shares of Series C Preferred Stock converted on such applicable Conversion Date, such applicable Adjustment Period shall be deemed to have ended on, and included, the Trading Day immediately prior to such Conversion Date). If any shares of Common Stock, Options or Common Stock Equivalents are issued or sold or deemed to have been issued or sold for cash, the consideration received therefor will be deemed to be the net amount of consideration received by the Corporation therefor. If any shares of Common Stock, Options or Common Stock Equivalents are issued or sold for a consideration other than cash, the amount of such consideration received by the Corporation will be the fair value of such consideration, except where such consideration consists of publicly traded securities, in which case the amount of consideration received by the Corporation for such securities will be the arithmetic average of the VWAPs of such security for each of the five (5) Trading Days immediately preceding the date of receipt. If any shares of Common Stock, Options or Common Stock Equivalents are issued to the owners of the non-surviving entity in connection with any merger in which the Corporation is the surviving entity, the amount of consideration therefor will be deemed to be the fair value of such portion of the net assets and business of the non-surviving entity as is attributable to such shares of Common Stock, Options or Common Stock Equivalents (as the case may be). The fair value of any consideration other than cash or publicly traded securities will be determined jointly by the Corporation and the Holder. If such parties are unable to reach agreement within ten (10) days after the occurrence of an event requiring valuation (the “Valuation Event”), the fair value of such consideration will be determined within five (5) Trading Days after the tenth (10th) day following such Valuation Event by an independent, reputable appraiser jointly selected by the Corporation and the Holder. The determination of such appraiser shall be final and binding upon all parties absent manifest error and the fees and expenses of such appraiser shall be borne by the Corporation.
(v) Record Date. If the Corporation takes a record of the holders of shares of Common Stock for the purpose of entitling them (A) to receive a dividend or other distribution payable in shares of Common Stock, Options or in Common Stock Equivalents or (B) to subscribe for or purchase shares of Common Stock, Options or Common Stock Equivalents, then such record date will be deemed to be the date of the issuance or sale of the shares of Common Stock deemed to have been issued or sold upon the declaration of such dividend or the making of such other distribution or the date of the granting of such right of subscription or purchase (as the case may be).
(c) Pro Rata Distributions. During such time as the Series C Preferred Stock is outstanding, if the Corporation declares or makes 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 the Series C Preferred Stock, 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 equal to the greater of (i) the number of Conversion Shares issuable upon conversion of all shares of Series C Preferred Stock held by such Holder pursuant to Section 6(c), and (ii) the number of Conversion Shares issuable upon conversion of all shares of Series C Preferred Stock held by such Holder pursuant to Section 6(d), (in each case, without regard to any limitations on conversion 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).
(d) Stock Combination Event Adjustments. If at any time and from time to time on or after the date hereof there occurs any stock split, stock dividend, stock combination recapitalization or other similar transaction involving the Common Stock (each, a “Stock Combination Event”, and such date thereof, the “Stock Combination Event Date”) and the Event Market Price is less than the Conversion Price then in effect (after giving effect to the adjustment in Section 7(a) above), then on the sixteenth (16th) Trading Day immediately following such Stock Combination Event Date, the Conversion Price then in effect on such sixteenth (16th) Trading Day (after giving effect to the adjustment in Section 7(a) above) shall be reduced (but in no event increased) to the Event Market Price.
(e) Calculations. All calculations under this Section 7 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 7, 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 any treasury shares of the Corporation) issued and outstanding.
(f) Voluntary Adjustment. Subject to the rules and regulations of the Principal Market, the Corporation may at any time, with the prior written consent of the Required Holders, reduce (but not increase) the then-current Conversion Price of all shares of Series C Preferred Stock to any amount and for any period of time deemed appropriate by the Board of Directors. Subject to the rules and regulations of the Principal Market, the Corporation may, at any time and without the consent of the Required Holders, lower the Floor Price to any amount and for any period of time deemed appropriate by the Board of Directors, upon written notice to the Holders.
(g) Notice to the Holders.
(i) Adjustment to Conversion Price. Whenever the Conversion Price is adjusted pursuant to any provision of this Section 7, the Corporation shall promptly deliver to each record Holder by facsimile or email a notice setting forth the Conversion Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment.
(ii) Notice to Allow Conversion by Holder. If (A) the Corporation shall declare a dividend (or any other distribution in whatever form) on the Common Stock, (B) the Corporation shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the Corporation shall authorize the granting to all holders of the Common Stock of 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 Corporation shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Corporation is a party, any sale or transfer of all or substantially all of the assets of the Corporation, or any compulsory share exchange whereby the Common Stock is converted into other securities, cash or property or (E) the Corporation shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Corporation, then, in each case, the Corporation shall cause to be filed at each office or agency maintained for the purpose of conversion of this Series C Preferred Stock, and shall cause to be delivered by facsimile or email to each record Holder at its last facsimile number or email address as it shall appear upon the stock books of the Corporation, at least twenty (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 hereunder constitutes, or contains, material, non-public information regarding the Corporation, the Corporation shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. The Holder shall remain entitled to convert the Conversion Amount of this Series C Preferred Stock (or any part hereof) during the 20-day period commencing on the date of such notice through the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.
(h) Purchase Rights. In addition to any adjustments pursuant to this Section 7, if at any time the Corporation grants, issues or sells any Options, Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata to all or substantially all of the record holders of any class of Common Stock (the “Purchase Rights”), then each Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which such Holder could have acquired if such Holder had held the number of shares of Common Stock acquirable upon complete conversion of its Series C Preferred Stock (without regard to any limitations on conversion and assuming conversion at the Alternate Conversion Price as of the applicable record date) immediately prior to the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, 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 grant, issue or sale of such Purchase Rights; provided, however, that to the extent that such Holder’s right to participate in any such Purchase Right would result in such Holder exceeding the Beneficial Ownership Limitation, such Holder shall not be entitled to participate in such Purchase Right to such extent (or in the beneficial ownership of any shares of Common Stock as a result thereof to such extent), and such Purchase Right to such extent shall be held in abeyance (with any expiration date or similar term extended by the number of days held in abeyance) for the benefit of such Holder until such time, if ever, as its right thereto would not result in such Holder exceeding the Beneficial Ownership Limitation.
(i) Other Corporate Events. In addition to and not in substitution for any other rights hereunder, prior to the consummation of any Fundamental Transaction pursuant to which holders of shares of Common Stock are entitled to receive securities or other assets with respect to or in exchange for shares of Common Stock (a “Corporate Event”), the Corporation shall make appropriate provision to ensure that each Holder will thereafter have the right, at its option, to receive upon a conversion of its Series C Preferred Stock (i) in addition to the shares of Common Stock receivable upon such conversion, such securities or other assets to which such Holder would have been entitled with respect to such shares of Common Stock had such shares been held by such Holder upon the consummation of such Corporate Event (without regard to any limitations on conversion) or (ii) in lieu of the shares of Common Stock otherwise receivable upon such conversion, such securities or other assets received by the holders of shares of Common Stock in connection with such Corporate Event in such amounts as such Holder would have been entitled to receive had its Series C Preferred Stock initially been issued with conversion rights for the form of such consideration (as opposed to shares of Common Stock) at a conversion rate for such consideration commensurate with the conversion rate hereunder. Provision made pursuant to the preceding sentence shall be in a form and substance satisfactory to the Required Holders. This Section 7(i) shall apply similarly and equally to successive Corporate Events and shall be applied without regard to any limitations on conversion or redemption.
(j) Holder’s Right of Adjusted Conversion Price. In addition to and not in limitation of the other provisions of this Section 7, if the Corporation in any manner issues or sells or enters into any agreement to issue or sell any Common Stock, Options or Common Stock Equivalents (any such securities, “Variable Price Securities”) after the date of the Purchase Agreement that are issuable pursuant to such agreement or convertible into or exchangeable or exercisable for shares of Common Stock at a price which varies or may vary with the market price of the shares of Common Stock, including by way of one or more reset(s) to a fixed price but exclusive of such formulations reflecting customary anti-dilution provisions (such as share splits, share combinations, share dividends and similar transactions) (each of the formulations for such variable price being herein referred to as the “Variable Price”), the Corporation shall provide written notice thereof by electronic mail to each Holder on the date of such agreement and/or issuance, as applicable. From and after such date, each Holder shall have the right, but not the obligation, in its sole discretion to substitute the Variable Price for the Conversion Price upon conversion of its Series C Preferred Stock by designating in the Notice of Conversion that solely for purposes of such conversion such Holder is relying on the Variable Price rather than the Conversion Price then in effect. A Holder’s election to rely on a Variable Price for a particular conversion shall not obligate such Holder to rely on a Variable Price for any future conversion.
(k) Other Events. In the event that the Corporation (or any Subsidiary) shall take any action to which the provisions hereof are not strictly applicable, or, if applicable, would not operate to protect the Holders from dilution, or if any event occurs of the type contemplated by the provisions of this Section 7 but not expressly provided for by such provisions (including, without limitation, the granting of stock appreciation rights, phantom stock rights or other rights with equity features), then the Board of Directors shall in good faith determine and implement an appropriate adjustment in the Conversion Price so as to protect the rights of the Holders, provided that no such adjustment will increase the Conversion Price as otherwise determined pursuant to this Section 7, provided further that if the Required Holders do not accept such adjustments as appropriately protecting their interests hereunder against such dilution, then the Board of Directors and the Required Holders shall agree, in good faith, upon an independent investment bank of nationally recognized standing to make such appropriate adjustments, whose determination shall be final and binding absent manifest error and whose fees and expenses shall be borne by the Corporation.
Section 8. Certain Negative Covenants. Without the consent of the Required Holders, the Corporation shall not, and the Corporation shall cause each of its Subsidiaries to not, directly or indirectly:
(a) (i) fail to pay, when due, or within any applicable grace period, any payment with respect to Indebtedness in excess of five hundred thousand dollars ($500,000) due to any third party (other than, with respect to unsecured Indebtedness only, payments contested by the Corporation and/or such Subsidiary (as the case may be) in good faith by proper proceedings and with respect to which adequate reserves have been set aside for the payment thereof in accordance with generally accepted accounting principles) or is otherwise in breach or violation of any agreement for monies owed or owing in an amount in excess of five hundred thousand dollars ($500,000), which breach or violation permits the other party thereto to declare a default or otherwise accelerate amounts due thereunder, or (ii) suffer to exist any other circumstance or event that would, with or without the passage of time or the giving of notice, result in a default or event of default, that has not been waived, under any agreement binding the Corporation or any Subsidiary, which default or event of default would or is likely to have a material adverse effect on the business, assets, operations (including results thereof), liabilities, properties, condition (including financial condition) or prospects of the Corporation or any of its Subsidiaries, individually or in the aggregate;
(b) incur any Indebtedness, other than Permitted Indebtedness;
(c) incur any Liens, other than Permitted Liens;
(d) redeem, defease, repurchase, repay or make any payments in respect of, by the payment of cash or cash equivalents (in whole or in part, whether by way of open market purchases, tender offers, private transactions or otherwise), all or any portion of any Indebtedness, whether by way of payment in respect of principal of (or premium, if any) or interest on such Indebtedness, if at the time such payment is due or is otherwise made or, after giving effect to such payment, a Mandatory Redemption Event or Trigger Event, or an event that with the passage of time and without being cured would constitute a Mandatory Redemption Event or Trigger Event, has occurred and is continuing;
(e) redeem, repurchase or declare or pay any cash dividend or distribution on any of its capital stock (other than as required by this Certificate of Designation); provided, that the cashless or net exercise of any Options or Common Stock Equivalents, or the withholding of Common Stock in the ordinary course of business in connection with the exercise or vesting of any employee options or restricted stock units, shall not be deemed to be a redemption;
(f) sell, lease, license, assign, transfer, spin-off, split-off, close, convey or otherwise dispose of any assets or rights of the Corporation or any Subsidiary owned or hereafter acquired, whether in a single transaction or a series of related transactions (each, an “Asset Sale”), other than (i) transfers of any such assets or rights in the ordinary course of business consistent with past practice and (ii) sales of inventory and product in the ordinary course of business;
(g) engage in any material line of business substantially different from those lines of business conducted by or publicly contemplated to be conducted by the Corporation and its Subsidiaries on the Original Designation Date or any business substantially related or incidental thereto, or modify its or their corporate structure or purpose; or
(h) enter into, renew, extend or be a party to any transaction or series of related transactions (including, without limitation, the purchase, sale, lease, transfer or exchange of property or assets of any kind or the rendering of services of any kind) with any Affiliate, except transactions in the ordinary course of business in a manner and to an extent consistent with past practice and necessary or desirable for the prudent operation of its business, for fair consideration and on terms no less favorable to it than would be obtainable in a comparable arm’s length transaction with a Person that is not an Affiliate.
Section 9. Ranking. Except to the extent that the Required Holders expressly consent to the creation of Parity Stock (as defined below) or Senior Preferred Stock (as defined below), all shares of Common Stock, shares of Series A Preferred Stock, shares of Series B Preferred Stock, and all capital stock of the Corporation authorized or designated after the date of the designation of the Series C Preferred Stock shall be junior in rank to the Series C Preferred Stock with respect to the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Corporation. Without limiting any other provision of this Certificate of Designation, without the prior express consent of the Required Holders, voting separate as a single class, the Corporation shall not hereafter authorize or issue any additional or other shares of capital stock that is (i) of senior rank to the Series C Preferred Stock in respect of the preferences as to distributions and payments upon the liquidation, dissolution and winding up of the Corporation (collectively, the “Senior Preferred Stock”) or (ii) of pari passu rank to the Series C Preferred Stock in respect of the preferences as to distributions and payments upon the liquidation, dissolution and winding up of the Corporation (collectively, the “Parity Stock”).
Section 10. Redemption.
(a) Mandatory Redemption.
(i) Unless previously converted into Conversion Shares as contemplated hereby, any shares of Series C Preferred Stock issued and outstanding as of the date of the occurrence of any Mandatory Redemption Event shall, at the option of the then Holder(s), be subject to mandatory redemption and repurchase by the Corporation, at the Per Share Redemption Price. Any Holder of Series C Preferred Stock seeking to redeem its Series C Preferred Stock shall, at any time following the occurrence of a Mandatory Redemption Event (the “Mandatory Redemption Period”), deliver a notice to the Corporation of such Holder’s intention to effect a mandatory redemption of his or its Series C Preferred Stock (the “Mandatory Redemption Notice”). Payment of the Redemption Amount, as set forth in a timely delivered Mandatory Redemption Notice, shall be paid by the Corporation in immediately available funds to the Holder or his designees on a date (the “Mandatory Redemption Date”) which shall be not later than ten (10) Business Days following the date of the Mandatory Redemption Notice. Within one (1) Business Day after the occurrence of any Mandatory Redemption Event, the Corporation shall deliver written notice thereof by electronic mail to each Holder, which notice shall include (I) a reasonable description of the applicable Mandatory Redemption Event, (II) a certification as to whether, in the opinion of the Corporation, such Mandatory Redemption Event is capable of being cured and, if applicable, a reasonable description of any existing plans of the Corporation to cure it and (III) a certification as to the date such Mandatory Redemption Event occurred and, if cured on or prior to the date of such notice, the date of such cure.
(ii) If the Corporation does not pay the Redemption Amount (or any other redemption price payable hereunder) to a Holder within the time period required for any reason, at any time thereafter and until the Corporation pays such unpaid amount in full, such Holder shall have the option, in lieu of redemption, to require the Corporation to promptly return to such Holder all or any portion of the shares of Series C Preferred Stock submitted for redemption and for which such amount (together with any Late Charges thereon) has not been paid. Upon the Corporation’s receipt of such notice, (x) the applicable redemption notice shall be null and void with respect to such shares, (y) the Stated Value of such shares shall be increased, pro rata, by an amount equal to the difference between (1) the applicable redemption price minus (2) the aggregate Stated Value of such shares and (z) the Conversion Price of such shares shall be automatically adjusted with respect to each conversion effected thereafter by such Holder to the lowest of (A) the Conversion Price as in effect on the date on which the applicable redemption notice is voided, (B) the greater of (x) the Floor Price and (y) 75% of the lowest Closing Bid Price during the period beginning on and including the date on which the applicable redemption notice is delivered to the Corporation and ending on and including the date on which it is voided and (C) the greater of (x) the Floor Price and (y) 75% of the quotient of (I) the sum of the five (5) lowest VWAPs of the Common Stock during the twenty (20) consecutive Trading Day period ending and including the applicable Conversion Date divided by (II) five (5) (all such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination or other similar transaction during such period). The voiding of a redemption notice shall not affect the Corporation’s obligation to pay any Late Charges accrued prior to the date of such voiding.
(iii) Upon the Corporation’s receipt of a redemption notice from any Holder, the Corporation shall, no later than one (1) Business Day following such receipt, forward a copy thereof to each other Holder by electronic mail. If the Corporation receives redemption notices from more than one Holder during the seven (7) Business Day period beginning on and including the date which is two (2) Business Days prior to its receipt of any such notice and ending on and including the date which is two (2) Business Days after such receipt, and is unable to redeem all shares of Series C Preferred Stock designated in such notices, the Corporation shall redeem a pro rata amount from each such Holder based on the Stated Value of the shares of Series C Preferred Stock submitted for redemption.
(iv) Upon the occurrence of any Mandatory Redemption Event, a Holder may, at its option and in lieu of (or prior to) delivering a Mandatory Redemption Notice with respect thereto, elect, by written notice to the Corporation, to increase the Stated Value of its shares of Series C Preferred Stock by an amount equal to ten percent (10%) of such Stated Value as of the date of such election; provided, that a Holder may not make more than three (3) such elections in the aggregate. Any such increase shall be effective automatically upon delivery of such notice. No such election shall constitute a waiver of any Mandatory Redemption Event or limit any other right or remedy of such Holder, and such Holder may deliver a Mandatory Redemption Notice with respect to any Mandatory Redemption Event (including any Mandatory Redemption Event as to which such an election was made) at any time such Mandatory Redemption Event is continuing
(b) Mandatory Redemption Event. Upon the occurrence and continuance of one of the following redemption events in Sections 10(b)(i) – 10(b)(xix) below (each a “Mandatory Redemption Event”), the Holder, at its sole discretion, may require a mandatory redemption by the Corporation of the Redemption Amount (such amount pursuant to this Section 10(b), the “Mandatory Redemption Amount”) within ten (10) Business Days after written notice from the Holder to the Corporation, provided, however, upon the occurrence of a Mandatory Redemption Event described in Section 10(b)(iv) below, the Mandatory Redemption Amount shall be immediately due and payable without any notice or demand:
(i) Failure to Pay Dividends or Other Amounts.
(A) The Corporation fails to pay, when due, any dividend in accordance herewith.
(B) The Corporation or any Subsidiary fails to pay, when due, any amounts payable by the Corporation to the Holder in accordance herewith or pursuant to any other Transaction Document (including, without limitation, any redemption payments), except, in the case of a failure to pay Late Charges when and as due, in which case only if such failure remains uncured for a period of twenty (20) calendar days.
(ii) Material Breach of Contract. The Corporation or any Subsidiary breaches any covenant or other term or condition of this Certificate of Designation or the other Transaction Documents, except, in the case of a breach that is curable, only if such breach remains uncured for a period of ten (10) consecutive calendar days; provided, that no breach shall constitute a Mandatory Redemption Event under this Section 10(b)(ii) to the extent such breach arises solely from the occurrence of an event described in Section 10(c) (including, without limitation, any suspension or delisting of the Common Stock, any failure of a Registration Statement to be declared or remain effective, any failure to obtain any Stockholder Approval or the failure of the Stockholder Approval Date to occur (other than any failure described in Section 10(b)(xix)), or any Authorized Share Failure), and any such breach shall instead constitute a Trigger Event.
(iii) Material Breach of Representations and Warranties. Any material representation or warranty of the Corporation made herein or in the other Transaction Documents shall have been false or misleading when made.
(iv) Voluntary Bankruptcy.
(A) Any bankruptcy, insolvency, reorganization or liquidation proceedings or other proceedings for the relief of debtors shall be instituted by the Corporation or any Subsidiary.
(B) The commencement by the Corporation or any Subsidiary (other than a Subsidiary with nominal assets and liabilities) of a voluntary case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree, order, judgment or other similar document in respect of the Corporation or any Subsidiary in an involuntary case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable federal, state or foreign law, or the consent by it to the filing of such petition or to the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Corporation or any Subsidiary or of any substantial part of its property, or the making by it of an assignment for the benefit of creditors, or the execution of a composition of debts, or the occurrence of any other similar federal, state or foreign proceeding, or the admission by it in writing of its inability to pay its debts generally as they become due, the taking of corporate action by the Corporation or any Subsidiary in furtherance of any such action or the taking of any action by any Person to commence a uniform commercial code foreclosure sale or any other similar action under federal, state or foreign law.
(v) Failure to File Registration Statement. The failure of the applicable Registration Statement (as defined in the Registration Rights Agreement) to be filed with the Commission on or prior to the date that is five (5) calendar days after the applicable Filing Deadline (as defined in the Registration Rights Agreement).
(vi) Conversion Failure. The Corporation (A) fails to cure a Conversion Failure by delivery of the required number of shares of Common Stock within five (5) Trading Days after the applicable Conversion Date or (B) provides notice, written or oral, to any Holder, including, without limitation, by way of public announcement or through any of its agents, at any time, of its intention not to comply, as required, with a request for conversion of any shares of Series C Preferred Stock into shares of Common Stock that is requested in accordance with the provisions of the Certificate of Designation, other than pursuant to Section 6(e); provided that any Conversion Failure resulting solely from the Exchange Cap or an Authorized Share Failure (which shall be governed exclusively by Section 6(g) and Section 6(c)(iii), respectively, and Section 10(c)) or resulting solely from any other event described in Section 10(c) shall not constitute a Mandatory Redemption Event under this Section 10(b)(vi).
(vii) Failure to Remove Restrictive Legends. The Corporation fails to remove any restrictive legend on any certificate or any shares of Common Stock issued to the Holder upon conversion of any shares of Series C Preferred Stock acquired by the Holder pursuant to the Purchase Agreement as and when required by the Purchase Agreement, unless otherwise then prohibited by applicable federal securities laws, and any such failure remains uncured for at least five (5) days.
(viii) [Reserved].
(ix) Fundamental Transaction. The consummation of a Fundamental Transaction in which the holders of Common Stock receive (or are entitled to receive) cash, securities or other property in exchange for, or with respect to, their shares of Common Stock (a “Stockholder Consideration Fundamental Transaction”).
(x) [Reserved].
(xi) Payment Default on Other Indebtedness. The Corporation and/or any Subsidiary, individually or in the aggregate, fails to pay, when due, or within any applicable grace period, any payment with respect to any Indebtedness in excess of five hundred thousand dollars ($500,000) due to any third party (other than, with respect to unsecured Indebtedness only, payments contested by the Corporation and/or such Subsidiary in good faith by proper proceedings and with respect to which adequate reserves have been set aside for the payment thereof in accordance with generally accepted accounting principles).
(xii) False Certification. A false or inaccurate certification (including a false or inaccurate deemed certification) by the Corporation that either (A) the Equity Conditions are satisfied, (B) there has been no Equity Conditions Failure or (C) as to whether any Mandatory Redemption Event has occurred.
(xiii) Payments in Breach. The Corporation or any of its Subsidiaries, directly or indirectly, makes any payment (whether in cash, securities or any other assets) with respect to any Indebtedness in breach of any covenant, term or condition of this Certificate of Designation.
(xiv) Material Non-Public Information. The Corporation, any Subsidiary or any Person acting on its or their behalf provides any Holder or its agents or counsel with any material, non-public information relating to the Corporation or any of its Subsidiaries, and such information is not publicly disclosed by the Corporation on or prior to the time required by this Certificate of Designation or the Purchase Agreement (or, if no time is so required, by such time as the Corporation shall have agreed in writing with such Holder to publicly disclose such information).
(xv) Failure to Declare Dividends. The Board of Directors fails to declare any dividend to be capitalized or paid on the applicable Dividend Date in accordance with Section 3.
(xvi) Material Agreement Breach. The Corporation or any Subsidiary breaches any material covenant or other term or condition of, or receives notice of termination or threatened termination of, any Material Agreement and such breach, if subject to cure, continues for a period of, or such notice is not rescinded within, ten (10) calendar days after notice of such breach or termination or threatened termination is received by the Corporation or any Subsidiary.
(xvii) Material Agreement Representations and Warranties. Any material representation or warranty of the Corporation or any Subsidiary made in any Material Agreement shall have been false or misleading when made and shall not be cured, if subject to cure, for a period of ten (10) calendar days after notice of such false or misleading representation or warranty is received by the Corporation or any Subsidiary.
(xviii) Invalidity. Any provision of any Transaction Document shall at any time for any reason (other than pursuant to the express terms thereof) cease to be valid and binding on or enforceable against the parties thereto, or the validity or enforceability thereof shall be contested by any party thereto, or a proceeding shall be commenced by the Corporation or any Subsidiary or any governmental authority having jurisdiction over any of them, seeking to establish the invalidity or unenforceability thereof, or the Corporation or any Subsidiary shall deny in writing that it has any liability or obligation purported to be created under any Transaction Document.
(xix) Failure to Hold Stockholders Meeting. The Corporation fails to call or hold a Stockholders Meeting (as defined in the Purchase Agreement), or to mail the related definitive proxy statement, when and as required by Section 4(ee)(iv) of the Purchase Agreement, unless, on or prior to the applicable Stockholders Meeting Deadline (as defined in the Purchase Agreement), the Corporation has obtained the applicable Stockholder Approval via Stockholder Consent (as defined in the Purchase Agreement).
(c) Trigger Events. Upon each occurrence of each of the following events in Sections 10(c)(i) – 10(c)(xviii) below (each a “Trigger Event”), the then Stated Value of all outstanding shares of Series C Preferred Stock shall automatically increase by twenty five percent (25%) of the Stated Value of such outstanding shares of Series C Preferred Stock. In addition, for so long as any Trigger Event or Mandatory Redemption Event is continuing, on the last day of each thirty (30) calendar day period commencing on the thirty-first (31st) calendar day following the occurrence of such Trigger Event or Mandatory Redemption Event, the then Stated Value of all outstanding shares of Series C Preferred Stock shall automatically increase by ten percent (10%) of such Stated Value, which increase shall apply separately with respect to each such Trigger Event and Mandatory Redemption Event and, if such Trigger Event or Mandatory Redemption Event is cured during any such thirty (30) calendar day period, shall be pro-rated based on the number of calendar days in such period prior to such cure. Notwithstanding the foregoing, the increases in Stated Value resulting from the Trigger Event described in Section 10(c)(iii) shall apply solely to the shares of Series C Preferred Stock whose Stated Value Event Date has occurred. No action by any Holder shall be necessary to effect any increase in Stated Value pursuant to this Section 10(c).
(i) Involuntary Bankruptcy.
(A) Any bankruptcy, insolvency, reorganization or liquidation proceedings or other proceedings for the relief of debtors shall be instituted against the Corporation or any Subsidiary and, if instituted against the Corporation or any Subsidiary by a third party, shall not be dismissed within thirty (30) days of their initiation.
(B) The entry by a court of (i) a decree, order, judgment or other similar document in respect of the Corporation or any Subsidiary of a voluntary or involuntary case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization or other similar law or (ii) a decree, order, judgment or other similar document adjudging the Corporation or any Subsidiary as bankrupt or insolvent, or approving as properly filed a petition seeking liquidation, reorganization, arrangement, adjustment or composition of or in respect of the Corporation or any Subsidiary under any applicable federal, state or foreign law or (iii) a decree, order, judgment or other similar document appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Corporation or any Subsidiary or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance of any such decree, order, judgment or other similar document or any such other decree, order, judgment or other similar document unstayed and in effect for a period of thirty (30) consecutive days.
(ii) Eligible Market.
(A) The suspension or halt (or threatened suspension or halt) from or of trading or the failure (or threatened failure) of the shares of Common Stock to be traded or listed (as applicable) on an Eligible Market for a period of one (1) Trading Day.
(B) The delisting or removal from quotation of the shares of Common Stock from an Eligible Market.
(iii) Stated Value Event Date. The Stated Value Event Date of any share of Series C Preferred Stock has occurred.
(iv) Judgments. A final judgment or judgments for the payment of money aggregating in excess of $500,000 are rendered against the Corporation and/or any of its Subsidiaries and are not, within thirty (30) days after the entry thereof, bonded, discharged, settled or stayed pending appeal, or are not discharged within thirty (30) days after the expiration of such stay; provided, however, that any judgment which is covered by insurance or an indemnity from a credit worthy party shall not be included in calculating such amount so long as the Corporation provides each Holder a written statement from such insurer or indemnity provider (which written statement shall be reasonably satisfactory to the Required Holders) to the effect that such judgment is covered by insurance or an indemnity and the Corporation or such Subsidiary will receive the proceeds of such insurance or indemnity within thirty (30) days of the issuance of such judgment.
(v) DTC Eligibility. The Common Stock is not eligible for clearing and settlement through DTC, the Transfer Agent ceases to participate in FAST, or DTC has imposed any “chill”, freeze or similar restriction on the Common Stock or on the clearing, deposit, transfer or settlement of shares of Common Stock through DTC, and, in each case, such condition continues for a period of three (3) Trading Days.
(vi) Auditor. The Corporation’s independent registered public accounting firm resigns (or notifies the Corporation of its intention to resign), or withdraws any opinion or report with respect to, or its consent to the use of, any financial statements of the Corporation, or any opinion or report of such accounting firm with respect to any financial statements of the Corporation contains a going concern qualification or otherwise expresses substantial doubt as to the ability of the Corporation and its Subsidiaries to continue as a going concern.
(vii) Investigation. The Commission, the United States Department of Justice or any other governmental or regulatory authority commences any investigation (other than any routine examination or inquiry not involving any allegation of wrongdoing) of, or any enforcement action or proceeding against, the Corporation, any Subsidiary or any of their respective directors or officers (in their capacities as such).
(viii) Material Adverse Effect. The occurrence of a Material Adverse Effect.
(ix) Default of Indebtedness. The occurrence of any default under, redemption of or acceleration prior to maturity of at least an aggregate of three hundred thousand dollars ($300,000) of Indebtedness of the Corporation or any Subsidiary, other than with respect to any Permitted Indebtedness, in which case only if such default, redemption, or acceleration, as applicable, remains uncured for a period of at least five (5) Trading Days.
(x) Failure to Cause or Maintain an Effective Registration Statement.
(A) The failure of the applicable Registration Statement (as defined in the Registration Rights Agreement) to be declared effective by the Commission on or prior to the date that is five (5) calendar days after the applicable Effectiveness Deadline (as defined in the Registration Rights Agreement).
(B) While the applicable Registration Statement is required to be maintained effective pursuant to the terms of the Registration Rights Agreement, the effectiveness of the applicable Registration Statement lapses for any reason (including, without limitation, the issuance of a stop order) or such Registration Statement (or the prospectus contained therein) is unavailable to any holder of Registrable Securities (as defined in the Registration Rights Agreement) for sale of all of such holder’s Registrable Securities in accordance with the terms of the Registration Rights Agreement, and such lapse or unavailability continues for a period of five (5) consecutive days or for more than an aggregate of ten (10) calendar days in any 365-day period (excluding days during an Allowable Grace Period (as defined in the Registration Rights Agreement)).
(xi) Equity Condition Failure. The occurrence of any of the following:
(A) The Market Capitalization as reported at the close of trading on the Principal Market is lower than $10,000,000 for at least five (5) Trading Days during any seven (7) Trading Day period.
(B) the consummation of any Equity Conditions Failure except for (1) any Price Failure or Volume Failure, (2) any failure of the condition set forth in clause (xvi) of the definition of Equity Conditions and (3) prior to the earlier of (x) the date by which the Corporation is required to obtain Effective Stockholder Approval (as defined in the Purchase Agreement) pursuant to Section 4(ee)(i) of the Purchase Agreement and (y) December 25, 2026, any failure of the condition set forth in clause (v) or clause (xvii) of the definition of Equity Conditions resulting solely from the Stockholder Approval Date not having occurred (unless waived in writing by the Required Holders).
(xii) Exchange Cap Conversion Failure. Any Conversion Failure solely resulting from the Exchange Cap occurs.
(xiii) Restatement. The Corporation restates, or announces (including, without limitation, in any filing with the Commission) any intention or requirement to restate, any financial statements of the Corporation previously filed with the Commission, or announces that any such financial statements should no longer be relied upon.
(xiv) Failure to Obtain Stockholder Approval. The Corporation’s failure to obtain the Stockholder Approval, or the failure of the Stockholder Approval Date to occur, as and when required pursuant to the terms of the Purchase Agreement.
(xv) Authorized Share Failure. Except to the extent the Corporation is in compliance with the last sentence of Section 6(c)(iii), an Authorized Share Failure exists on each of ten (10) consecutive days.
(xvi) Other Material Default. The Corporation or any Subsidiary suffers to exist any circumstance or event (other than an event described in Section 10(b)(xi)) that would, with or without the passage of time or the giving of notice, result in a default or event of default under any agreement binding the Corporation or any Subsidiary, which default or event of default would or is likely to have a material adverse effect on the business, assets, operations (including results thereof), liabilities, properties, condition (including financial condition) or prospects of the Corporation or any of its Subsidiaries, individually or in the aggregate.
(xvii) Other Fundamental Transactions. The Corporation’s entry into any agreement to effect a Fundamental Transaction, or the occurrence of any Fundamental Transaction other than a Stockholder Consideration Fundamental Transaction.
(xviii) Other Indebtedness Breach. The Corporation and/or any Subsidiary, individually or in the aggregate, is in breach or violation of any agreement for monies owed or owing in an amount in excess of five hundred thousand dollars ($500,000) (other than a failure to pay described in Section 10(b)(xi)), which breach or violation permits the other party thereto to declare a default or otherwise accelerate amounts due thereunder.
(d) Fundamental Transactions. The Corporation shall not enter into or be party to a Fundamental Transaction unless (i) the successor entity resulting from such Fundamental Transaction (or, if so elected by the Required Holders, the Parent Entity thereof) assumes in writing all of the obligations of the Corporation under this Certificate of Designation and the other Transaction Documents pursuant to written agreements in form and substance satisfactory to the Required Holders and approved by the Required Holders prior to such Fundamental Transaction, including, without limitation, the obligation to deliver to each Holder, in exchange for such Holder’s shares of Series C Preferred Stock, a security of such successor entity evidenced by a written instrument substantially similar in form and substance to this Certificate of Designation, including, without limitation, having a stated value and dividend rate equal to the Stated Value and dividend rate of the shares of Series C Preferred Stock held by such Holder and having similar ranking, conversion, redemption and other rights, satisfactory to the Required Holders, and (ii) such successor entity (or, if so elected by the Required Holders, the Parent Entity thereof) is a publicly traded corporation whose shares of common stock are quoted on or listed for trading on an Eligible Market. Upon the consummation of any Fundamental Transaction, such successor entity shall succeed to, and be substituted for, the Corporation (so that from and after the date of such Fundamental Transaction, each reference in this Certificate of Designation to the “Corporation” shall refer instead to such successor entity), and shall assume all of the obligations of the Corporation under this Certificate of Designation with the same effect as if such successor entity had been named as the Corporation herein. In addition, upon consummation of a Fundamental Transaction, the successor entity shall deliver to each Holder confirmation that there shall be issued upon conversion or redemption of the Series C Preferred Stock at any time after such consummation, in lieu of the shares of Common Stock (or other securities, cash, assets or other property, except such items still issuable under Section 7, which shall continue to be receivable thereafter) issuable upon conversion or redemption prior thereto, such shares of the publicly traded common stock (or their equivalent) of the successor entity (including its Parent Entity) which such Holder would have been entitled to receive had its Series C Preferred Stock been converted immediately prior to such Fundamental Transaction (without regard to any limitations on conversion), as adjusted in accordance with this Certificate of Designation. Notwithstanding the foregoing, a Holder may elect, at its sole option, by written notice to the Corporation, to waive this Section 10(d) to permit the Fundamental Transaction without the assumption of its Series C Preferred Stock. This Section 10(d) shall apply similarly and equally to successive Fundamental Transactions and shall be applied without regard to any limitations on the conversion or redemption of the Series C Preferred Stock.
(e) Late Charges. Any amount payable by the Corporation to any Holder pursuant to this Certificate of Designation (including, without limitation, any Redemption Amount, any dividend and any other amount payable hereunder) that is not paid to such Holder when due shall bear interest at a rate of one and one-half percent (1.5%) per month (prorated for partial months and compounding monthly) from the date such amount was due until the date such amount is paid in full to such Holder (“Late Charges”).
(f) Fundamental Transaction Notice; Redemption Price. No sooner than the earlier of (x) twenty (20) Trading Days prior to the consummation of a Fundamental Transaction or (y) the public announcement of the entry into an agreement with respect to a Fundamental Transaction, nor later than ten (10) Trading Days prior to the consummation of a Fundamental Transaction, the Corporation shall deliver written notice thereof by electronic mail and overnight courier to each Holder. Each Holder may deliver a Mandatory Redemption Notice with respect to the Mandatory Redemption Event described in Section 10(b)(ix) at any time after the earlier of such Holder’s receipt of such notice and such Holder becoming aware of such Fundamental Transaction (including prior to the consummation thereof), and such Mandatory Redemption Event shall be deemed to be continuing for such purpose until no earlier than twenty (20) Trading Days after the latest of (A) the consummation of such Fundamental Transaction, (B) such Holder’s receipt of such notice and (C) the public announcement of such Fundamental Transaction. Notwithstanding Section 10(a)(i), shares of Series C Preferred Stock redeemed pursuant to Section 10(a) upon the Mandatory Redemption Event described in Section 10(b)(ix) shall be redeemed at a price equal to the greatest of (i) the product of the Required Premium multiplied by the sum of (a) the Stated Value of the shares of Series C Preferred Stock being redeemed, plus (b) any other amounts owed by the Corporation to the Holders pursuant to this Certificate of Designation or any other Transaction Document not included in such Stated Value, (ii) the product of (A) the quotient of the Conversion Amount being redeemed divided by the Alternate Conversion Price then in effect multiplied by (B) the greatest Official Closing Price during the period beginning on the date immediately preceding the earlier of the consummation and the public announcement of such Fundamental Transaction and ending on the date the Holder delivers the Mandatory Redemption Notice and (iii) the product of (A) the quotient of the Conversion Amount being redeemed divided by the Conversion Price then in effect multiplied by (B) the aggregate cash consideration and the aggregate cash value of any non-cash consideration per share of Common Stock to be paid to the holders of the Common Stock upon consummation of such Fundamental Transaction (any non-cash consideration constituting publicly traded securities to be valued at the highest closing sale price of such securities on the Trading Day immediately prior to the consummation of such Fundamental Transaction, the Trading Day immediately following the public announcement thereof and the Trading Day immediately prior to the public announcement thereof). The Corporation shall have the option (such election, a “Consideration Election”) to pay the redemption price described in this Section 10(f) (the “Fundamental Transaction Redemption Price”) either (A) in cash or (B) by delivery of rights (with a beneficial ownership limitation in the form of Section 6(e) hereof, mutatis mutandis) (collectively, the “Rights”), convertible in whole, or in part, at any time, without the requirement to pay any additional consideration, at the option of the applicable Holder, into the securities or other assets received by the holders of Common Stock in connection with such Fundamental Transaction (the “Corporate Event Consideration”) equal in value to the Fundamental Transaction Redemption Price (with the fair market value of the aggregate number of shares of capital stock or other equity interests included in the Corporate Event Consideration (the “Successor Shares”) issuable upon conversion of the Rights to be determined in increments of 10% (or such greater percentage as the applicable Holder may notify the Corporation from time to time) of the portion of the Fundamental Transaction Redemption Price attributable to such Successor Shares (each, a “Successor Share Value Increment”), with the aggregate number of Successor Shares issuable upon conversion of the Rights with respect to the first Successor Share Value Increment determined based on 70% of the VWAP of the Successor Shares on the date the Rights are issued and, on each of the nine (9) subsequent Trading Days, the aggregate number of additional Successor Shares issuable upon conversion of the Rights determined based upon a Successor Share Value Increment at 70% of the VWAP of the Successor Shares in effect for such corresponding Trading Day (such ten (10) Trading Day period commencing on, and including, the date the Rights are issued, the “Rights Measuring Period”)), and in no event in any other form; provided, that the Corporation shall not consummate a Fundamental Transaction if the Corporate Event Consideration includes Successor Shares either in an entity that is not listed on an Eligible Market or in an entity in which the daily share volume for the applicable Successor Shares for each of the twenty (20) Trading Days prior to the date of consummation of such Fundamental Transaction is less than the aggregate number of Successor Shares issuable to all Holders upon conversion in full of the applicable Rights (without regard to any limitations on conversion therein, assuming the conversion in full of the Rights on the date of issuance of the Rights and assuming the VWAP of the Successor Shares for each Trading Day in the Rights Measuring Period is the VWAP on the Trading Day ended immediately prior to the time of consummation of such Fundamental Transaction). The Corporation shall give each Holder written notice of each Consideration Election at least twenty (20) Trading Days prior to the time of consummation of such Fundamental Transaction. Notwithstanding Sections 10(a)(i) and 10(b), payment of the Fundamental Transaction Redemption Price or delivery of the Rights, as applicable, shall be made by the Corporation (or at the Corporation’s direction) to each Holder on the later of (x) the second (2nd) Trading Day after the date of the applicable Mandatory Redemption Notice and (y) the date of consummation of such Fundamental Transaction (or, with respect to any Right, if applicable, such later time that holders of shares of Common Stock are initially entitled to receive Corporate Event Consideration with respect to their shares of Common Stock). Any Corporate Event Consideration included in the Rights is pari passu with the Corporate Event Consideration to be paid to holders of shares of Common Stock, and the Corporation shall not permit a payment of any Corporate Event Consideration to the holders of shares of Common Stock without, on or prior to such time, delivering the Rights to the Holders in accordance herewith. Cash payments, if any, required by this Section 10(f) shall have priority to payments to all other stockholders of the Corporation in connection with such Fundamental Transaction. Notwithstanding anything to the contrary in this Section 10(f), but subject to Section 6(e), until the applicable Fundamental Transaction Redemption Price is paid in full to the applicable Holder in cash or Corporate Event Consideration in accordance herewith, the shares of Series C Preferred Stock submitted by such Holder for redemption under this Section 10(f) may be converted, in whole or in part, by such Holder into Conversion Shares pursuant to Section 6 or, in the event the Conversion Date is after the consummation of such Fundamental Transaction, into stock or equity interests of the successor entity substantially equivalent to the shares of Common Stock pursuant to Section 10(d). In the event of the Corporation’s redemption or exchange, as applicable, of any shares of Series C Preferred Stock under this Section 10(f), such Holder’s damages would be uncertain and difficult to estimate because of the parties’ inability to predict future interest rates and the uncertainty of the availability of a suitable substitute investment opportunity for a Holder; accordingly, any premium due under this Section 10(f) is intended by the parties to be, and shall be deemed, a reasonable estimate of such Holder’s actual loss of its investment opportunity and not a penalty. Notwithstanding anything herein to the contrary, in connection with any redemption hereunder at a time a Holder is entitled to receive a cash payment under any of the other Transaction Documents, at the option of such Holder delivered in writing to the Corporation, the applicable redemption price hereunder shall be increased by the amount of such cash payment owed to such Holder under such other Transaction Document and, upon payment in full or conversion in accordance herewith, shall satisfy the Corporation’s payment obligation under such other Transaction Document.
(g) Corporation Optional Redemption. At any time beginning on the date that is the tenth (10th) Business Day prior to the Stated Value Event Date of the applicable shares, the Corporation shall have the right to redeem all outstanding shares of Series C Preferred Stock subject to such Stated Value Event Date (a “Corporation Optional Redemption”) at an amount equal to the greater of (i) the Conversion Amount of the shares being redeemed (or, if an Equity Conditions Failure exists on the Optional Redemption Notice Date or at any time thereafter through the Optional Redemption Date, 110% of such Conversion Amount) and (ii) the product of (x) the quotient obtained by dividing such Conversion Amount by the lower of (A) the Conversion Price and (B) the Alternate Conversion Price, in each case in effect on the Trading Day immediately prior to the Optional Redemption Date (as defined below), multiplied by (y) the highest price at which the Common Stock traded on the Trading Day immediately prior to the Optional Redemption Date (the “Corporation Optional Redemption Amount”). To effect, a Corporation Optional Redemption, the Corporation shall deliver an irrevocable notice to such Holder stating the intention to effect a Corporation Optional Redemption and the number of such Holder’s Series C Preferred Stock subject to such redemption (the “Optional Redemption Notice”). Payment of the Corporation Optional Redemption Amount, as set forth in the Optional Redemption Notice, shall be paid by the Corporation in immediately available funds to the Holder or its designees on a date (the “Optional Redemption Date”) on the tenth (10th) Business Day following the date the Holder receives such Optional Redemption Notice (the “Optional Redemption Notice Date”). Upon the Holder’s receipt of such Optional Redemption Notice, the Corporation shall be obligated to redeem such shares of Series C Preferred Stock as set forth in such Optional Redemption Notice; provided, however, that any conversion of Series C Preferred Stock by the Holder after the Optional Redemption Notice Date but before the Optional Redemption Date shall reduce the Conversion Amount used to calculate the Corporation Optional Redemption Amount by the Conversion Amount of such converted shares of Series C Preferred Stock, and the Corporation Optional Redemption Amount shall be recalculated accordingly.
Section 11. Miscellaneous.
(a) Notices. Any and all notices or other communications or deliveries to be provided by the Holders or the Corporation hereunder including, without limitation, any Notice of Conversion, shall be in writing and delivered personally, by e-mail or facsimile, or sent by a nationally recognized overnight courier service, addressed to (i) the Corporation at NextNRG, Inc., 407 Lincoln Rd. #9F, Miami Beach, Florida 33139 Attention: Michael D. Farkas, email address mdf@nextnrg.com or such other email address or address as the Corporation may specify for such purposes by notice to the Holders delivered in accordance with this Section 11 or (ii) the applicable Holder at the most current address for such Holder, in the Corporation’s records, or such other email address or address as such Holder may specify for such purposes by notice to the Corporation delivered in accordance with this Section 11. Any and all notices or other communications or deliveries to be provided by the Corporation or the Holders hereunder shall be in writing and delivered personally, by email, or sent by a nationally recognized overnight courier service addressed to each record Holder or at the email address or address of such Holder appearing on the books of the Corporation or to the Corporation at the address set forth above. Any notice or other communication or deliveries hereunder shall be deemed given and effective on the earliest of (i) the time of transmission, if such notice or communication is delivered via facsimile at the facsimile number or email at the email address set forth in this Section 11 prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day after the time of transmission, if such notice or communication is delivered via facsimile at the facsimile number or email at the email address set forth in this Section 11 on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such notice is required to be given
(b) Absolute Obligation. Except as expressly provided herein, no provision of this Certificate of Designation shall alter or impair the obligation of the Corporation, which is absolute and unconditional, to pay dividends, liquidated damages, Late Charges, the Redemption Amount and all other amounts payable on the shares of Series C Preferred Stock, and to deliver Conversion Shares, at the time, place, and rate, and in the coin or currency, herein prescribed.
(c) Lost or Mutilated Series C Preferred Stock Certificate. If a Holder’s Series C Preferred Stock certificate, if any, shall be mutilated, lost, stolen or destroyed, the Corporation shall execute and deliver, in exchange and substitution for and upon cancellation of a mutilated certificate, or in lieu of or in substitution for a lost, stolen or destroyed certificate, a new certificate, or upon election of the Holder, a statement of book-entry, registered in the name of the Holder or its designee, for the shares of Series C Preferred Stock so mutilated, lost, stolen or destroyed, but only upon receipt of evidence of such loss, theft or destruction of such certificate, and of the ownership hereof reasonably satisfactory to the Corporation.
(d) Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Certificate of Designation shall be governed by and construed and enforced in accordance with the internal laws of the State of Nevada, without regard to the principles of conflict of laws thereof. All legal proceedings concerning the interpretation, enforcement and defense of the transactions contemplated by this Certificate of Designation (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 Las Vegas, Nevada (the “Nevada Courts”). The Corporation hereby irrevocably submits to the exclusive jurisdiction of the Nevada Courts for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of such Nevada Courts, or such Nevada Courts are improper or inconvenient venue for such proceeding. The Corporation 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 Certificate of Designation 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. Nothing contained herein shall be deemed or operate to preclude any Holder from bringing suit or taking other legal action against the Corporation in any other jurisdiction to collect on the Corporation’s obligations to such Holder or to enforce a judgment or other court ruling in favor of such Holder. The Corporation 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 Certificate of Designation or the transactions contemplated hereby. If (a) any Holder takes action to collect amounts due under, or to enforce the provisions of, this Certificate of Designation or (b) there occurs any bankruptcy, reorganization, receivership of the Corporation or other proceedings affecting the Corporation’s creditors’ rights and involving a claim under this Certificate of Designation, then the Corporation shall pay the costs incurred by such Holder for such collection, enforcement or action or in connection with such proceeding, including, without limitation, attorneys’ fees and disbursements. The Corporation expressly acknowledges and agrees that no amounts due under this Certificate of Designation with respect to any shares of Series C Preferred Stock shall be affected, or limited, by the fact that the purchase price paid for each share of Series C Preferred Stock was less than the original Stated Value thereof.
(e) Waiver. Any waiver by the Corporation or a Holder of a breach of any provision of this Certificate of Designation shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Certificate of Designation or a waiver by any other Holders. The failure of the Corporation or a Holder to insist upon strict adherence to any term of this Certificate of Designation on one or more occasions shall not be considered a waiver or deprive that party (or any other Holder) of the right thereafter to insist upon strict adherence to that term or any other term of this Certificate of Designation on any other occasion. Any waiver by the Corporation or a Holder must be in writing. Notwithstanding the foregoing, nothing contained in this Section 11(e) shall permit any waiver of any provision of Section 6(e).
(f) Amendment. Except for Section 6(e), which may not be amended, modified or waiver, this Certificate of Designation or any provision hereof may be amended and/or restated by obtaining the affirmative vote at a meeting duly called for such purpose, or written consent without a meeting, each in accordance with the laws of the State of Nevada and the Articles of Incorporation, of the Required Holders, voting separate as a single class, and with such other stockholder approval, if any, as may then be required pursuant to the laws of the State of Nevada and the Articles of Incorporation. Except (a) to the extent otherwise expressly provided in this Certificate of Designation or the Articles of Incorporation with respect to voting or approval rights of a particular class or series of capital stock or (b) to the extent otherwise provided pursuant to the laws of the State of Nevada, the holders of each outstanding class or series of shares of the Corporation shall not be entitled to vote as a separate voting group on any amendment to the terms of this Certificate of Designation with respect to which such class or series would otherwise be entitled under the laws of the State of Nevada to vote as a separate voting group.
(g) Severability. If any provision of this Certificate of Designation is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect the validity of the remaining provisions of this Certificate of Designation so long as this Certificate of Designation as so modified continues to express, without material change, the original intentions of the Corporation and the Holders as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The Corporation and the Holders will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s). If any provision is inapplicable to any Person or circumstance, it shall nevertheless remain applicable to all other Persons and circumstances. If it shall be found that any interest or other amount deemed interest due hereunder violates the applicable law governing usury, the applicable rate of interest due hereunder shall automatically be lowered to equal the maximum rate of interest permitted under applicable law.
(h) Next Business Day. Whenever any payment or other obligation hereunder shall be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day.
(i) Headings; Construction. The headings contained herein are for convenience only, do not constitute a part of this Certificate of Designation and shall not be deemed to limit or affect any of the provisions hereof. Unless the context clearly indicates otherwise, each pronoun herein shall be deemed to include the masculine, feminine, neuter, singular and plural forms thereof. The terms “including,” “includes,” “include” and words of like import shall be construed broadly as if followed by the words “without limitation.” The terms “herein,” “hereunder,” “hereof” and words of like import refer to this entire Certificate of Designation instead of just the provision in which they are found. Terms used in this Certificate of Designation and not otherwise defined herein, but defined in the Purchase Agreement or the other Transaction Documents (as defined in the Purchase Agreement), shall have the meanings ascribed to such terms in the Purchase Agreement or such other Transaction Documents as in effect on the date this Certificate of Designation is filed with the Secretary of State of the State of Nevada, unless otherwise consented to in writing by the Required Holders.
(j) Status of Converted or Redeemed Series C Preferred Stock. If any shares of Series C Preferred Stock shall be converted, redeemed or reacquired by the Corporation, such shares shall resume the status of authorized but unissued shares of preferred stock of the Corporation and shall no longer be designated as Series C Preferred Stock.
(k) Remedies, Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Certificate of Designation shall be cumulative and in addition to all other remedies available under this Certificate of Designation 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 any Holder’s right to pursue actual and consequential damages for any failure by the Corporation to comply with the terms of this Certificate of Designation. The exercise of any right or remedy of a Holder shall not be deemed to be an election of such Holder’s rights or remedies. Amounts set forth or provided for herein with respect to payments, conversion and the like (and the computation thereof) shall be the amounts to be received by the Holders and shall not, except as expressly provided herein, be subject to any other obligation of the Corporation (or the performance thereof). The Corporation acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holders and that the remedy at law for any such breach may be inadequate, and agrees that, in the event of any such breach or threatened breach, each Holder shall be entitled, in addition to all other available remedies, to specific performance and/or temporary, preliminary and permanent injunctive or other equitable relief from any court of competent jurisdiction without the necessity of proving actual damages and without posting a bond or other security. The Corporation shall provide all information and documentation to a Holder that is requested by such Holder to enable it to confirm the Corporation’s compliance with the terms and conditions of this Certificate of Designation (including, without limitation, compliance with Section 7).
(l) Judgment Currency. If for the purpose of obtaining or enforcing judgment against the Corporation in any court in any jurisdiction it becomes necessary to convert into any other currency (the “Judgment Currency”) an amount due in U.S. dollars hereunder, the conversion shall be made at the U.S. dollar exchange rate published in The Wall Street Journal (the “Exchange Rate”) prevailing on the Trading Day immediately preceding (i) the date of actual payment of the amount due, in the case of any proceeding in the courts of Nevada or in the courts of any other jurisdiction that will give effect to such conversion being made on such date, or (ii) the date on which the foreign court determines, in the case of any proceeding in the courts of any other jurisdiction (the “Judgment Conversion Date”). If, in the case of any proceeding referred to in clause (ii), there is a change in the Exchange Rate between the Judgment Conversion Date and the date of actual payment, the Corporation shall pay such adjusted amount as may be necessary to ensure that the amount paid in the Judgment Currency, when converted at the Exchange Rate prevailing on the date of payment, will produce the amount of U.S. dollars which could have been purchased with the amount of Judgment Currency stipulated in the judgment or judicial order at the Exchange Rate prevailing on the Judgment Conversion Date. Any amount due from the Corporation under this Section 11(l) shall be due as a separate debt and shall not be affected by judgment being obtained for any other amounts due under or in respect of this Certificate of Designation.
(m) Taxes. All payments made by the Corporation hereunder shall be made without set-off, counterclaim, withholding, deduction or other defense, and free and clear of any present or future taxes, levies, imposts, deductions, charges or withholdings and all liabilities with respect thereto, excluding (i) taxes imposed on the net income of a Holder by the jurisdiction in which such Holder is organized or has its principal office, (ii) taxes imposed due to the failure of the applicable recipient to provide the Corporation, when requested in writing, with any applicable valid and properly completed IRS Form W-9, W-8BEN, W-8BEN-E, W-8ECI and/or W-8IMY and (iii) taxes imposed due to the failure of the applicable recipient to comply with Sections 1471 through 1474 of the Internal Revenue Code of 1986, as amended (all such non-excluded amounts, “Taxes”). If the Corporation is required to deduct or withhold any Taxes from any amount payable hereunder, (A) the amount so payable shall be increased as necessary so that after all required deductions and withholdings (including on amounts payable under this clause (A)) such Holder receives the amount it would have received had no such deduction or withholding been made, (B) the Corporation shall make such deduction or withholding and pay the full amount deducted or withheld to the relevant governmental authority in accordance with applicable law and (C) the Corporation shall promptly deliver to such Holder an official receipt (or other evidence reasonably satisfactory to such Holder) showing such payment. The Corporation shall indemnify and hold harmless each Holder and its affiliates and their respective officers, directors, employees, agents and advisors against any Taxes, and any stamp, documentary or similar taxes arising from any payment hereunder or from the execution, delivery, registration or enforcement of this Certificate of Designation, paid by any of them, and any liability (including penalties, interest and expenses) arising therefrom, within thirty (30) days after written demand. If any such indemnified Person determines in good faith that it has received a refund of any Taxes so indemnified, it shall pay such refund (net of its out-of-pocket expenses and without interest) to the Corporation, provided that no such Person shall be required to make any payment that would place it in a less favorable net after-tax position than it would have been in had such Taxes not been imposed, or to make its tax returns available. This Section 11(m) shall survive the conversion or redemption in full of the Series C Preferred Stock.
(n) Waiver of Notice. To the extent permitted by law, the Corporation hereby irrevocably waives demand, notice, presentment, protest and all other demands and notices in connection with the delivery, acceptance, performance, default or enforcement of this Certificate of Designation and the Purchase Agreement.
(o) 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 Corporation to the applicable Holder and thus refunded to the Corporation.
Section 12. Additional Covenants. So long as any shares of Series C Preferred Stock are outstanding:
(a) Preservation of Existence. The Corporation shall maintain and preserve, and cause each of its Subsidiaries to maintain and preserve, its existence, rights and privileges, and become or remain, and cause each of its Subsidiaries to become or remain, duly qualified and in good standing in each jurisdiction in which the character of the properties owned or leased by it or in which the transaction of its business makes such qualification necessary.
(b) Maintenance of Properties. The Corporation shall maintain and preserve, and cause each of its Subsidiaries to maintain and preserve, all of its properties which are necessary or useful in the proper conduct of its business in good working order and condition, ordinary wear and tear excepted, and comply, and cause each of its Subsidiaries to comply, at all times with the provisions of all leases to which it is a party as lessee or under which it occupies property, so as to prevent any loss or forfeiture thereof or thereunder.
(c) Maintenance of Intellectual Property. The Corporation will, and will cause each of its Subsidiaries to, take all action necessary or advisable to maintain all of the intellectual property rights of the Corporation and its Subsidiaries that are necessary or material to the conduct of its business in full force and effect.
(d) Maintenance of Insurance. The Corporation shall maintain, and cause each of its Subsidiaries to maintain, director and officer insurance with responsible and reputable insurance companies or associations in an aggregate amount of not less than $5,000,000. The Corporation shall maintain, and cause each of its Subsidiaries to maintain, insurance with responsible and reputable insurance companies or associations (including, without limitation, comprehensive general liability, hazard, rent and business interruption insurance) with respect to its properties (including all real properties leased or owned by it) and business, in such amounts and covering such risks as is required by any governmental authority having jurisdiction with respect thereto or as is carried generally in accordance with sound business practice by companies in similar businesses similarly situated.
(e) Stay, Extension and Usury Laws. To the extent that it may lawfully do so, the Corporation (A) agrees that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law (wherever or whenever enacted or in force) that may affect the covenants or the performance of this Certificate of Designation and (B) expressly waives all benefits or advantages of any such law and agrees that it will not, by resort to any such law, hinder, delay or impede the execution of any power granted to the Holders by this Certificate of Designation, but will suffer and permit the execution of every such power as though no such law has been enacted.
(f) Taxes. The Corporation and its Subsidiaries shall pay when due all taxes, fees or other charges of any nature whatsoever (together with any related interest or penalties) now or hereafter imposed or assessed against the Corporation and its Subsidiaries or their respective assets or upon their ownership, possession, use, operation or disposition thereof or upon their rents, receipts or earnings arising therefrom (except where the failure to pay would not, individually or in the aggregate, have a material effect on the Corporation or any of its Subsidiaries), and shall file on or before the due date therefor all personal property tax returns (except where the failure to file would not, individually or in the aggregate, have a material effect on the Corporation or any of its Subsidiaries); provided that the Corporation and its Subsidiaries may contest, in good faith and by appropriate proceedings, taxes for which they maintain adequate reserves therefor in accordance with generally accepted accounting principles.
(g) Most Favored Nation. If the Corporation enters into any Subsequent Placement (as defined in the Purchase Agreement), or amends, modifies or waives any term of any security of the Corporation or of any agreement evidencing Indebtedness, in each case, on terms (economic or otherwise) more favorable to any Person than the terms provided to the Holders under the Transaction Documents, the Corporation shall promptly (and in any event within one (1) Business Day) notify each Holder of such terms, and, at the election of such Holder, such terms shall automatically become a part of the Transaction Documents for the benefit of such Holder without any further action by the Corporation or such Holder.
(h) Independent Investigation. At the request of any Holder either (x) at any time when a Mandatory Redemption Event or Trigger Event has occurred and is continuing, (y) upon the occurrence of an event that with the passage of time or giving of notice would constitute a Mandatory Redemption Event or Trigger Event or (z) at any time such Holder reasonably believes a Mandatory Redemption Event or Trigger Event may have occurred or be continuing, the Corporation shall hire an independent, reputable investment bank selected by the Corporation and approved by such Holder to investigate as to whether any breach of this Certificate of Designation has occurred (the “Independent Investigator”). If the Independent Investigator determines that such breach has occurred, the Independent Investigator shall notify the Corporation of such breach, the Corporation shall deliver written notice to each Holder of such breach and the Corporation shall pay all fees and expenses of the Independent Investigator. In connection with such investigation, the Independent Investigator may, during normal business hours, inspect all contracts, books, records, personnel, offices and other facilities and properties of the Corporation and its Subsidiaries and, to the extent available to the Corporation after it uses reasonable efforts to obtain them, the records of its legal advisors and accountants (including the accountants’ work papers) and any books of account, records, reports and other papers not contractually required of the Corporation to be confidential or secret, or subject to attorney-client or other evidentiary privilege, and may make such copies and inspections thereof as it may reasonably request. The Corporation shall furnish the Independent Investigator with such financial and operating data and other information with respect to the business and properties of the Corporation as it may reasonably request, and shall permit it to discuss the affairs, finances and accounts of the Corporation with the Corporation’s officers, directors, key employees and independent public accountants, all at such reasonable times, upon reasonable notice, and as often as may be reasonably requested.
(i) Noncircumvention. The Corporation will not, by amendment of the Articles of Incorporation or its bylaws or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Certificate of Designation, and will at all times in good faith carry out all of its provisions and take all action as may be required to protect the rights of the Holders. Without limiting the foregoing, the Corporation (i) shall not increase the par value of any shares of Common Stock receivable upon conversion of the Series C Preferred Stock above the Conversion Price then in effect and (ii) shall take all such actions as may be necessary or appropriate in order that the Corporation may validly and legally issue fully paid and non-assessable shares of Common Stock upon conversion of the Series C Preferred Stock. If after the sixtieth (60th) calendar day after the applicable Original Issuance Date a Holder is not permitted to convert its Series C Preferred Stock in full for any reason (other than pursuant to Section 6(e)), the Corporation shall use its best efforts to promptly remedy such failure, including, without limitation, obtaining such consents or approvals as necessary to effect such conversion into shares of Common Stock.
IN WITNESS WHEREOF, the undersigned has executed this Certificate of Designation this 7th day of October, 2026.
| By: | /s/ Michael D. Farkas | |
| Name: | Michael D. Farkas | |
| Title: | Chief Executive Officer |
ANNEX A NOTICE OF CONVERSION
(TO BE EXECUTED BY THE HOLDER IN ORDER TO CONVERT SHARES OF SERIES C PREFERRED STOCK)
The undersigned hereby elects to convert the number of shares of Series C Preferred Stock indicated below into Conversion Shares according to the conditions hereof, as of the date written below. No fee or tax will be charged to a Holder for any conversion. Capitalized terms used and not otherwise defined herein shall have the meanings given such terms in Certificate of Designation of Preferences, Rights and Limitations of Series C Convertible Non-Voting Preferred Stock.
Conversion calculations:
Date to effect conversion:
Number of shares of Series C Preferred Stock owned prior to conversion: Number of shares of Series C Preferred Stock to be converted:
Stated Value of shares of Series C Preferred Stock to be converted: Number of Conversion Shares to be issued:
Applicable Conversion Price:
| ☐ | Conversion Price: $ _____ |
| ☐ | Alternate Conversion Price: $ ______ |
| ☐ | Variable Price (Section 7(j)): $ ______ |
| ☐ | 120% of Conversion Amount applies (Mandatory Redemption Event / Trigger Event (Section 6(d)(ii)) |
Number of shares of Series C Preferred Stock subsequent to conversion:
ANNEX B ACKNOWLEDGMENT
The Corporation hereby (a) acknowledges this Notice of Conversion, (b) certifies that the above indicated number of shares of Common Stock [are][are not] eligible to be resold by the Holder either (i) pursuant to Rule 144 (subject to the Holder’s execution and delivery to the Corporation of a customary 144 representation letter) or (ii) an effective and available registration statement and (c) hereby directs the Transfer Agent to issue the above indicated number of shares of Common Stock in accordance with the Transfer Agent Instructions dated________________, 20 ___from the Corporation and acknowledged and agreed to by_________________________________.
| NEXTNRG, INC. | ||
| By: | ||
| Name: | ||
| Title: | ||
Exhibit 10.1
FORM OF AMENDED AND RESTATED VOTING, SUPPORT AND STANDSTILL AGREEMENT
This Amended and Restated Voting, Support and Standstill Agreement (this “Agreement”), dated as of October 7, 2026, and effective as of September 30, 2026 (the “Effective Date”), by and among NextNRG, Inc., a Delaware corporation (the “Company”), and certain stockholders of the Company as listed on Schedule A hereto (each, a “Stockholder” and, collectively, the “Stockholders”).
RECITALS
WHEREAS, on August 13, 2026 (the “Original Effective Date”), (a) the Company and the Buyers entered into that certain Securities Purchase Agreement (the “Original Purchase Agreement”), pursuant to which (and subject to the terms and conditions set forth therein) the Company agreed to issue and sell to, and the Buyers have agreed to purchase from the Company, certain Securities, and (b) the Company and the Stockholders entered those certain Voting, Support and Standstill Agreements (the “Original Voting Agreements”);
WHEREAS, on September 30, 2026, the Company and the Buyers entered into an amendment to the Original Purchase Agreement (the “SPA Amendment”, and together with the Original Purchase Agreement, the “Purchase Agreement”; capitalized terms used but not defined in this Agreement shall have the meanings ascribed to them in the Purchase Agreement);
WHEREAS, the execution and delivery of this Agreement by each Stockholder to amend and restate their respective Original Voting Agreement is a material inducement to the willingness of the Buyers to enter into the Purchase Agreement;
WHEREAS, pursuant to the Purchase Agreement, the Company has agreed to obtain each Required Stockholder Approval (including, without limitation, the Principal Market Stockholder Consent, each Split Authorization and any Stockholder Approval required following a Stockholder Approval Failure) as set forth in the Purchase Agreement, in each case with respect to the Series C Preferred Stock having the terms set forth in the Certificate of Designation (as amended from time to time) (collectively, the “Stockholder Proposals”);
WHEREAS, each Stockholder certifies that he or she is the record or “beneficial owner” (within the meaning of Rule 13d-3 under the Exchange Act) of shares of Common Stock and/or shares of Series B Preferred Stock, as set forth opposite his or her respective name on Schedule A hereto (with respect to each Stockholder, the “Owned Shares”); the Owned Shares and any additional shares of Common Stock or other voting securities of the Company of which such Stockholder acquires record or beneficial ownership after the date hereof, including, without limitation, by purchase, as a result of a stock dividend, stock split, recapitalization, combination, reclassification, exchange or change of such shares, or upon exercise or conversion of any securities, such Stockholder’s “Covered Shares”);
WHEREAS, each share of Common Stock is entitled to one vote per share and each share of Series B Preferred Stock is entitled to vote together with the Common Stock, or any class thereof, as applicable, as one class and shall have a number of votes equal to the number of shares of Common Stock issuable upon conversion of such shares of Series B Preferred Stock;
WHEREAS, each Stockholder acknowledges that the Company and Buyers are entering into the Purchase Agreement in reliance on the representations, warranties, covenants and other agreements of the Stockholders set forth in this Agreement and would not enter into the Purchase Agreement if any Stockholder did not enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements herein contained, and intending to be legally bound hereby, the Company and the Stockholders hereby agree as follows:
1. Agreement to Vote. Each Stockholder irrevocably and unconditionally agrees that during the term of this Agreement it shall at any meeting or meetings of the stockholders of the Company (whether annual or special and whether or not an adjourned or postponed meeting) called to vote upon one or more Stockholder Proposals (a “Stockholder Meeting” and, collectively, the “Stockholder Meetings”), however called, or in connection with any Stockholder Consent with respect to one or more Stockholder Proposals:
(a) vote, or cause to be voted in connection with such Stockholder Consent, all Covered Shares (and respond to each request by the Company for Stockholder Consent):
(i) in favor of the Stockholder Proposals and any other matters necessary for consummation of the Stockholder Proposals, and
(ii) against any other action that would reasonably be expected to impede, interfere with, delay, postpone or adversely affect the approval of the Stockholder Proposals or any of the transactions contemplated by this Agreement or to result in a breach of any covenant, representation or warranty, or any other obligation or agreement of such Stockholder under this Agreement.
(b) when a Stockholder Meeting is held, appear at such meeting or otherwise cause the Covered Shares to be counted as present thereat for the purpose of establishing a quorum, and respond to each request by the Company for written consent, if any, vote, or cause to be voted at such Stockholder Meeting (or validly execute and return and cause any Stockholder Consent to be granted with respect to), all Covered Shares:
(i) in favor of (A) each Stockholder Proposal and any other matters necessary for consummation of such Stockholder Proposals and (B) any proposal to adjourn or postpone such Stockholder Meeting to a later date if there are not sufficient votes to approve any Stockholder Proposal, and
(ii) against any other action that would reasonably be expected to impede, interfere with, delay, postpone or adversely affect the approval of such Stockholder Proposals or any of the transactions contemplated by this Agreement or to result in a breach of any covenant, representation or warranty, or any other obligation or agreement of such Stockholder under this Agreement.
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2. No Inconsistent Agreements. Each Stockholder hereby represents, covenants and agrees that, except as contemplated by this Agreement, such Stockholder: (a) has not entered into, and shall not enter into at any time prior to the Termination Date, any tender, voting or other similar agreement or arrangement, or voting trust with respect to any Covered Shares and (b) has not granted, and shall not grant at any time prior to the Termination Date, a proxy or power of attorney with respect to any Covered Shares, in either case, which is inconsistent with such Stockholder’s obligations pursuant to this Agreement.
3. Termination. This Agreement and all obligations on the part of the Stockholders hereunder shall terminate upon the later to occur of: (a) the date on which all Required Stockholder Approvals (other than any Split Authorization) have been obtained, and (b) December 31, 2028 (such latest date, the “Termination Date”); provided, that any liability incurred by any party hereto as a result of a breach of a term or condition of this Agreement prior to the Termination Date shall survive the termination of this Agreement; provided further, that the Stockholders’ obligations pursuant to Section 5(d) shall not terminate until the date, following the Additional Closing Expiration Date, on which there are no shares of Series C Preferred Stock outstanding.
4. Representations and Warranties of Stockholders. Each Stockholder, as to itself (severally and not jointly), hereby represents and warrants to the Company as follows:
(a) Such Stockholder is the record or beneficial owner of, and has good and valid title to, the Covered Shares, free and clear of Liens other than as created by this Agreement. Such Stockholder has sole voting power, sole power of disposition, sole power to demand appraisal rights and sole power to agree to all of the matters set forth in this Agreement, in each case with respect to all of such Covered Shares, with no limitations, qualifications or restrictions on such rights, subject to applicable federal securities laws and the terms of this Agreement. The Covered Shares are not subject to any voting trust agreement or other contract to which such Stockholder is a party restricting or otherwise relating to the voting or Transfer (as defined below) of the Covered Shares. Except pursuant to this Agreement, there are no options, warrants, or other rights, agreements, arrangements, or commitments of any character to which such Stockholder is a party relating to the pledge, disposition, or voting of any of the Covered Shares. Such Stockholder has not appointed or granted any proxy or power of attorney that is still in effect with respect to any Covered Shares, except as contemplated by this Agreement.
For the purposes of this Agreement, “Transfer” means, with respect to any Covered Shares, any assignment, pledge, conveyance of any legal or beneficial ownership interest in, sale, transfer, exchange, gift, mortgage, encumbrance, grant of a security interest, issuance of a participation interest, or other disposition, either directly or indirectly, by operation of law or otherwise
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(b) Each such Stockholder which is an entity is duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation and has all requisite power and authority to execute and deliver this Agreement and to perform its obligations hereunder; each such Stockholder who is a natural person has full legal power and capacity to execute and deliver this Agreement and to perform such Stockholder’s obligations hereunder. The execution, delivery and performance of this Agreement by each such Stockholder which is an entity, the performance by such Stockholder of its obligations hereunder and the consummation by such Stockholder of the transactions contemplated hereby have been duly and validly authorized by such Stockholder and no other actions or proceedings on the part of such Stockholder are necessary to authorize the execution and delivery by such Stockholder of this Agreement, the performance by such Stockholder of its obligations hereunder or the consummation by such Stockholder of the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by such Stockholder and, assuming due authorization, execution and delivery by the Company, constitutes a legal, valid and binding obligation of such Stockholder, enforceable against such Stockholder in accordance with its terms, except as enforcement may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally and by general principles of equity (regardless of whether considered in a proceeding in equity or at law). If such Stockholder is married, and any of the Covered Shares of such Stockholder constitute community property or otherwise need spousal or other approval for this Agreement to be legal, valid and binding, this Agreement has been duly and validly executed and delivered by such Stockholder’s spouse and, assuming due authorization, execution and delivery by the Company, constitutes a legal, valid and binding obligation of such Stockholder’s spouse, enforceable against such Stockholder’s spouse in accordance with its terms, except as enforcement may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally and by general principles of equity (regardless of whether considered in a proceeding in equity or at law).
(c) Except for the applicable requirements of the Exchange Act, (i) no filing with, and no permit, authorization, consent or approval of, any governmental authority is necessary on the part of such Stockholder for the execution, delivery and performance of this Agreement by such Stockholder or the consummation by such Stockholder of the transactions contemplated hereby and (ii) neither the execution, delivery or performance of this Agreement by such Stockholder nor the consummation by such Stockholder of the transactions contemplated hereby nor compliance by such Stockholder with any of the provisions hereof shall (A) conflict with or violate, any provision of the organizational documents of any such Stockholder which is an entity, (B) result in any breach or violation of, or constitute a default (or an event which, with notice or lapse of time or both, would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, or result in the creation of a Lien on such property or asset of such Stockholder pursuant to, any contract to which such Stockholder is a party or by which such Stockholder or any property or asset of such Stockholder is bound or affected or (C) violate any order, writ, injunction, decree, statute, rule or regulation applicable to such Stockholder or any of such Stockholder’s properties or assets except, in the case of clause (B) or (C), for breaches, violations or defaults that would not, individually or in the aggregate, materially impair the ability of such Stockholder to perform its obligations hereunder.
(d) There is no action, suit, investigation, complaint or other proceeding pending against any such Stockholder or, to the knowledge of such Stockholder, any other Person or, to the knowledge of such Stockholder, threatened against any Stockholder or any other Person that could reasonably be expected to materially impair or materially adversely affect the ability of such Stockholder to perform such Stockholder’s obligations hereunder or to restrict or prohibit (or that, if successful, would restrict or prohibit) the exercise by the Company of its rights under this Agreement or the performance by any party of its obligations under this Agreement.
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(e) Such Stockholder understands and acknowledges that the Company is entering into the Purchase Agreement in reliance upon such Stockholder’s execution and delivery of this Agreement and the representations and warranties of such Stockholder contained herein.
5. Certain Covenants of Stockholder. Each Stockholder, for itself (severally and not jointly), hereby covenants and agrees as follows:
(a) Such Stockholder hereby appoints the Company and any designee of the Company, and each of them individually, until the Termination Date (at which time this proxy shall automatically be revoked), as its proxies and attorneys-in-fact, with full power of substitution and resubstitution, to vote or act by written consent during the term of this Agreement with respect to such Stockholder’s Covered Shares in accordance with Section 1. This proxy and power of attorney is given to secure the performance of the duties of such Stockholder under this Agreement. Such Stockholder shall take such further action or execute such other instruments as may be necessary to effectuate the intent of this proxy. This proxy and power of attorney granted by such Stockholder shall be irrevocable during the term of this Agreement, shall be deemed to be coupled with an interest sufficient in law to support an irrevocable proxy, and shall revoke any and all prior proxies granted by such Stockholder with respect to his, her or its Covered Shares. The power of attorney granted by Stockholder herein is a durable power of attorney and shall survive the bankruptcy, death, or incapacity of such Stockholder. The proxy and power of attorney granted hereunder shall terminate upon the termination of this Agreement.
(b) Prior to the Termination Date, and except as contemplated hereby, such Stockholder shall not grant any proxies or powers of attorney, deposit any Covered Shares into a voting trust or enter into a voting agreement with respect to any Covered Shares or knowingly take any action that would have the effect of preventing or disabling such Stockholder from performing its obligations under this Agreement.
(c) Prior to the Termination Date, in the event that such Stockholder acquires record or beneficial ownership of, or the power to vote or direct the voting of, any additional shares of Common Stock or other voting interests with respect to the Company, such shares of Common Stock or voting interests shall, without further action of the parties, be deemed Covered Shares and subject to the provisions of this Agreement, and the number of shares of Common Stock held by such Stockholder set forth on Schedule A hereto will be deemed amended accordingly and such shares of Common Stock or voting interests shall automatically become subject to the terms of this Agreement. Each Stockholder shall promptly notify the Company of any such event.
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(d) Standstill; Permitted Payments.
(i) Such Stockholder, in its capacity as a holder, directly or indirectly, of any Indebtedness of the Company or any of its Subsidiaries owed to such Stockholder or any of its Affiliates, whether now existing or hereafter arising and whether or not secured (collectively, the “Stockholder Debt”), covenants and agrees that, from and after the Original Effective Date and until the date, following the Additional Closing Expiration Date, on which no shares of Series C Preferred Stock remain outstanding (the “Standstill Period”), such Stockholder shall not, without the prior written consent of the Required Holders, directly or indirectly: (A) demand, sue for, accelerate or otherwise seek or receive payment of all or any portion of the principal of, or any premium, fee, make-whole or similar amount on, the Stockholder Debt; (B) exercise or enforce any right or remedy in respect of the Stockholder Debt, including any right of setoff, recoupment or subrogation, or any right to foreclose upon or otherwise realize against any collateral securing the Stockholder Debt; (C) commence, or join with any other Person in commencing, any bankruptcy, insolvency, receivership or similar proceeding against the Company or any of its Subsidiaries; or (D) amend, supplement or otherwise modify the terms of the Stockholder Debt in any manner adverse to the holders of the Series C Preferred Stock, or Transfer all or any portion of the Stockholder Debt other than to a transferee that first agrees in a writing, reasonably satisfactory to the Required Holders, to be bound by this Section 5(d).
(ii) Notwithstanding the foregoing, nothing in this Section 5(d) shall prohibit the Company from paying, or such Stockholder from receiving and retaining, (A) regularly scheduled payments of interest on the Stockholder Debt as and when due in accordance with the terms of the Stockholder Debt as in effect on the date hereof, whether paid in cash or in shares of Common Stock or, as it relates to principal payments, in shares of Common Stock, or (z) in kind by capitalizing such interest and adding it to the principal amount of the Stockholder Debt, or (B) any other payment expressly consented to in writing by the Required Holders; provided, that no payment described in clause (A) shall be made or retained at any time when a Mandatory Redemption Event or Trigger Event (each as defined in the Certificate of Designation), or any event that with the passage of time or the giving of notice would constitute a Mandatory Redemption Event or Trigger Event, has occurred and is continuing, or when any amount then due to the holders of the Series C Preferred Stock remains unpaid; provided however, that neither the Principal Market’s September 15, 2026 letter to the Company nor the occurrence of an Equity Condition Failure as set forth in Section 10(c)(xi)(a) of the Certificate of Designation shall be a Trigger Event. This Section 5(d) applies to such Stockholder solely in its capacity as a holder of Stockholder Debt and, for the avoidance of doubt, shall not limit such Stockholder’s rights as a holder of capital stock of the Company or, subject to Section 6, as a director, officer or employee of the Company.
6. Stockholder Capacity. This Agreement is being entered into by each Stockholder solely in its capacity as a stockholder of the Company and not in such Stockholder’s capacity as a director, officer or employee of the Company, and nothing in this Agreement shall restrict or limit the ability of any Stockholder, any of its Affiliates, or any of their respective directors, officers or employees who is a director or officer of the Company to take any action or inaction or voting on any matter in his or her capacity as a director or officer of the Company, including taking any action specifically permitted by the Purchase Agreement.
7. Disclosure. Each Stockholder hereby authorizes the Company to publish and disclose in any announcement or disclosure required by the SEC such Stockholder’s identity and ownership of the Covered Shares and the nature of such Stockholder’s obligations under this Agreement.
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8. Further Assurances. Each Stockholder agrees, from time to time, and without additional consideration, to execute and deliver such additional proxies, documents, and other instruments and to take all such further action as the Company may reasonably request to consummate and make effective the transactions contemplated by this Agreement.
9. [Reserved.]
10. Amendment and Modification. This Agreement may not be amended, modified or supplemented in any manner, whether by course of conduct or otherwise, except by an instrument in writing specifically designated as an amendment hereto, signed on behalf of each party to whom such amendment, modification or supplement applies and otherwise as expressly set forth herein.
11. Waiver. No failure or delay of any party in exercising any right or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such right or power, or any course of conduct, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the parties hereunder are cumulative and are not exclusive of any rights or remedies which they would otherwise have hereunder. Any agreement on the part of a party to any such waiver shall be valid only if set forth in a written instrument executed and delivered by such party.
12. Notices. All notices and other communications hereunder shall be in writing and shall be deemed duly given (a) on the date of delivery if delivered personally, or if by e-mail, upon written confirmation of receipt by e-mail or otherwise, (b) on the first Business Day following the date of dispatch if delivered utilizing a next-day service by a recognized next-day courier or (c) on the earlier of confirmed receipt or the fifth Business Day following the date of mailing if delivered by registered or certified mail, return receipt requested, postage prepaid. All notices hereunder shall be delivered to the addresses set forth below, or pursuant to such other instructions as may be designated in writing by the party to receive such notice:
(i) If to a Stockholder, to the address set forth opposite such Stockholder’s name on Schedule A hereto.
(ii) If to the Company:
NextNRG, Inc.
407 Lincoln Rd. #9F
Miami Beach, Florida 33139
Telephone: (305) 786-6998
Attention: Michael D. Farkas
E-Mail: mdf@nextnrg.com
with a copy (which shall not constitute notice) to:
Sichenzia Ross Ference Carmel LLP
1185 6th Avenue, 26th Floor
New York, New York 10036
Telephone: (646) 734-4111
Attention: Gregory Sichenzia
E-Mail: Gsichenzia@srfc.law
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13. Entire Agreement. This Agreement constitutes the entire agreement, and supersedes all prior written agreements, arrangements, communications and understandings and all prior and contemporaneous oral agreements, arrangements, communications and understandings between the parties with respect to the subject matter hereof.
14. No Third-Party Beneficiaries. Nothing in this Agreement, express or implied, is intended to or shall confer upon any Person other than the parties and the Buyers and their respective successors and permitted assigns any legal or equitable right, benefit or remedy of any nature under or by reason of this Agreement. Soley in connection with Section 5(d), each Buyer (including the Lead Buyer, on its own behalf and on behalf of the holders of Series C Preferred Stock) is an express third-party beneficiary of, and shall be entitled to enforce directly, the Stockholders’ obligations thereof to the extent related to the Stockholder Debt.
15. Governing Law. This Agreement and all disputes or controversies arising out of or relating to this Agreement or the transactions contemplated hereby shall be governed by, and construed in accordance with, the internal laws of the State of Delaware, without regard to the laws of any other jurisdiction that might be applied because of the conflicts of laws principles of the State of Delaware; provided, however, that from and after the consummation of the Redomestication (as defined in the SPA Amendment), the references herein to “Delaware” shall be deemed to refer to “Nevada”.
16. Submission to Jurisdiction. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Agreement (whether brought against a party hereto or its respective affiliates, directors, officers, stockholders, partners, members, employees or agents) shall be resolved by arbitration in New York City in front of a single arbitrator under the auspices of the American Arbitration Association. The arbitrator shall issue a written ruling and such ruling may be enforced against the parties hereto in any court of competent jurisdiction. It shall be a condition of the appointment of the arbitrator that he/she shall commit to issue a final, written decision of the dispute within 90 days of his/her appointment. The parties recognize the importance of such tight time-frame and shall not request extensions thereof, nor shall the arbitrator grant any such extensions.
17. Assignment; Successors. Neither this Agreement nor any of the rights, interests or obligations under this Agreement may be assigned or delegated, in whole or in part, by operation of law or otherwise, by any party without the prior written consent of the other parties, and any such assignment without such prior written consent shall be null and void; provided, however, that the Company may assign, in its sole discretion, any or all of its rights, interests and obligations under this Agreement to any of its Affiliates at any time, in which case all references herein to the Company, as applicable, shall be deemed references to such other Affiliate. Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of, and be enforceable by, the parties and their respective successors and assigns.
18. Enforcement. The parties agree that irreparable damage would occur in the event that the parties hereto do not perform the provisions of this Agreement in accordance with its terms or otherwise breach such provisions. Accordingly, prior to the Termination Date, the parties acknowledge and agree that each party shall be entitled to an injunction, specific performance and other equitable relief to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof, this being in addition to any other remedy to which such party is entitled at law or in equity. Each of the parties hereby further waives (a) any defense in any action for specific performance that a remedy at law would be adequate and (b) any requirement under any law to post security as a prerequisite to obtaining equitable relief.
19. Counterparts. This Agreement may be executed in two or more counterparts, all of which shall be considered one and the same instrument and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other party.
20. .pdf Signature. This Agreement may be executed by .pdf signature and a .pdf signature shall constitute an original for all purposes.
[The remainder of this page is intentionally left blank.]
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IN WITNESS WHEREOF, the Company and the Stockholders have caused to be executed or executed this Agreement as of the date first written above.
NEXTNRG, INC. | ||
| By: | ||
| Name: | ||
| Title: | ||
STOCKHOLDER: | ||
| By: | ||
| Name: | ||
| Title: | ||
SCHEDULE A
| Stockholder | Number of Owned Shares of Common Stock (after giving effect to the 1-for-10 reverse stock split effected on September 14, 2026) | Number of Owned Shares of Series B Preferred Stock | Notice Information | |||
| Michael D. Farkas - CEO | 6,349,793 | 140,000 | Michael D. Farkas 407 Lincoln Rd. #9F Miami Beach, Florida 33139 Telephone: (305) 786-6998 E-Mail: mdf@nextnrg.com | |||
| SIF Energy LLC | 15,483 | 0 | Michael D. Farkas 407 Lincoln Rd. #9F Miami Beach, Florida 33139 Telephone: (305) 786-6998 E-Mail: mdf@nextnrg.com | |||
| Balance Labs, Inc. | 2,658 | 0 | Michael D. Farkas 407 Lincoln Rd. #9F Miami Beach, Florida 33139 Telephone: (305) 786-6998 E-Mail: mdf@nextnrg.com | |||
| Inductive Holdings LLC | 1,290,019 | 0 | Michael D. Farkas 407 Lincoln Rd. #9F Miami Beach, Florida 33139 Telephone: (305) 786-6998 E-Mail: mdf@nextnrg.com |