SIMPLICITY ESPORTS & GAMING CO : Entry into a Material Definitive Agreement, Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant (form 8-K)

Item 1.01. Entry into Material Definitive Agreement.

Firstfire Global Opportunities Fund, LLC Securities Purchase Agreement and 12%
Convertible Promissory Note

On March 21, 2022, Simplicity Esports and Gaming Company (the “Company”) entered
into a securities purchase agreement (the “Firstfire Global SPA”), dated as of
March 21, 2022, with Firstfire Global Opportunities Fund, LLC, LLC (“Firstfire
Global”), pursuant to which the Company issued a 12% promissory convertible note
(the “Firstfire Global Note”) with a maturity date of September 21, 2022 (the
“Firstfire Global Maturity Date”), in the principal sum of $110,000.00. In
addition, the Company issued 935 shares of its common stock to Firstfire Global
as a commitment fee pursuant to the Firstfire Global SPA. Pursuant to the terms
of the Firstfire Global Note, the Company agreed to pay to Firstfire Global
$110,000.00 and to pay interest on the principal balance at the rate of 12% per
annum (provided that the first six months of interest ($6,600.00) shall be
guaranteed and the remaining 6 months of interest shall be deemed earned in full
as of the Issue Date thereof. The Firstfire Global Note carries an original
issue discount of $10,000.00. Accordingly, Firstfire Global paid the purchase
price of $100,000.00 in exchange for the Firstfire Global Note. The Company
intends to use the proceeds for working capital. Firstfire Global may convert
the Firstfire Global Note into the Company’s common stock (subject to the
beneficial ownership limitations of 4.99% in the Firstfire Global Note; provided
however, that the limitation on conversion may be waived (up to 9.99%) by
Firstfire Global upon, at the election of Firstfire Global, not less than 61
days’ prior notice to the Company) at any time at a conversion price equal to
$1.00 per share, as the same may be adjusted as provided in the Firstfire Global
Note.

The Company may prepay the Firstfire Global Note at any time prior to maturity
in accordance with the terms of the Firstfire Global Note. The Firstfire Global
Note contains customary events of default relating to, among other things,
payment defaults, breach of representations and warranties, and breach of
provisions of the Firstfire Global Note or the Firstfire Global SPA.

Upon the occurrence of any Event of Default (as defined in the Firstfire Global
Note), which has not been cured within the time prescribed in the Firstfire
Global Note, it shall become immediately due and payable and the Company shall
pay to Firstfire Global, in full satisfaction of its obligations hereunder, an
amount equal to the principal amount then outstanding plus accrued interest
multiplied by 125%.

Firstfire Global Opportunities Fund, LLC Common Stock Purchase Warrant

Pursuant to the terms of the Firstfire Global SPA, on March 21, 2022, the
Company also issued to Firstfire Global a three-year warrant (the “Firstfire
Global Warrant”) to purchase 50,000 shares of the Company’s common stock at an
exercise price of $1.00.

Firstfire Global Opportunities Fund, LLC Registration Rights Agreement

Pursuant to the terms of the Firstfire Global SPA, on March 21, 2022, the
Company also entered into a registration rights agreement, dated March 21, 2022,
by and between the Company and Firstfire Global (the “Firstfire Global
Registration Rights Agreement”). Pursuant to the terms of the Firstfire Global
Registration Rights Agreement, the Company agreed to prepare and file with the
SEC a registration statement covering the resale of all shares issued or
issuable pursuant to the Firstfire Global SPA, including shares issued upon
conversion of the Firstfire Global Note or upon exercise of the Firstfire Global
Warrant. The Company agreed to use its commercially reasonable efforts to have
the registration statement filed with the SEC within 30 days following March 21,
2022 and to have the registration statement declared effective by the SEC within
60 days following March 21, 2022.

The Firstfire Global Registration Rights Agreement contains customary
indemnification provisions.

The description of the Firstfire Global SPA, the Firstfire Global Note, the
Firstfire Global Warrant, and the Firstfire Global Registration Rights Agreement
does not purport to be complete and is qualified in its entirety by reference to
the Firstfire Global SPA, the Firstfire Global Note, the Firstfire Global
Warrant, and the Firstfire Global Registration Rights Agreement, copies of which
will be filed as exhibits to the company’s next periodic report.

GS Capital Partners, LLC Securities Purchase Agreement and 12% Convertible
Promissory Note

On March 21, 2022, the Company entered into a securities purchase agreement (the
“GS Capital SPA”), dated as of March 21, 2022, with GS Capital Partners, LLC
(“GS Capital“), pursuant to which the Company issued a 12% promissory
convertible note (the “GS Capital Note”) with a maturity date of September 21,
2022 (the “GS Capital Maturity Date”), in the principal sum of $82,500.00. In
addition, the Company issued 703 shares of its common stock to GS Capital as a
commitment fee pursuant to the GS Capital SPA. Pursuant to the terms of the GS
Capital Note, the Company agreed to pay to GS Capital $82,500.00 and to pay
interest on the principal balance at the rate of 12% per annum (provided that
the first six months of interest ($4,950.00) shall be guaranteed and the
remaining 6 months of interest shall be deemed earned in full as of the Issue
Date thereof. The GS Capital Note carries an original issue discount of
$7,500.00. Accordingly, GS Capital paid the purchase price of $75,000.00 in
exchange for the GS Capital Note. The Company intends to use the proceeds for
working capital. GS Capital may convert the GS Capital Note into the Company’s
common stock (subject to the beneficial ownership limitations of 4.99% in the GS
Capital Note; provided however, that the limitation on conversion may be waived
(up to 9.99%) by GS Capital upon, at the election of GS Capital, not less than
61 days’ prior notice to the Company) at any time at a conversion price equal to
$1.00 per share, as the same may be adjusted as provided in the GS Capital Note.

The Company may prepay the GS Capital Note at any time prior to maturity in
accordance with the terms of the GS Capital Note. The GS Capital Note contains
customary events of default relating to, among other things, payment defaults,
breach of representations and warranties, and breach of provisions of the GS
Capital Note or the GS Capital SPA.

Upon the occurrence of any Event of Default (as defined in the GS Capital Note),
which has not been cured within the time prescribed in the GS Capital Note, it
shall become immediately due and payable and the Company shall pay to GS
Capital, in full satisfaction of its obligations hereunder, an amount equal to
the principal amount then outstanding plus accrued interest multiplied by 125%.

GS Capital Common Stock Purchase Warrant

Pursuant to the terms of the GS Capital SPA, on March 21, 2022, the Company also
issued to GS Capital a three-year warrant (the “GS Capital Warrant”) to purchase
37,500 shares of the Company’s common stock at an exercise price of $1.00.

GS Capital Registration Rights Agreement

Pursuant to the terms of the GS Capital SPA, on March 21, 2022, the Company also
entered into a registration rights agreement, dated March 21, 2022, by and
between the Company and GS Capital (the “GS Capital Registration Rights
Agreement”). Pursuant to the terms of the GS Capital Registration Rights
Agreement, the Company agreed to prepare and file with the SEC a registration
statement covering the resale of all shares issued or issuable pursuant to the
GS Capital SPA, including shares issued upon conversion of the GS Capital Note
or upon exercise of the GS Capital Warrant. The Company agreed to use its
commercially reasonable efforts to have the registration statement filed with
the SEC within 30 days following March 21, 2022 and to have the registration
statement declared effective by the SEC within 60 days following March 21, 2022.

The GS Capital Registration Rights Agreement contains customary indemnification
provisions.

The description of the GS Capital SPA, the GS Capital Note, the GS Capital
Warrant, and the GS Capital Registration Rights Agreement does not purport to be
complete and is qualified in its entirety by reference to the GS Capital SPA,
the GS Capital Note, the GS Capital Warrant, and the GS Capital Registration
Rights Agreement, copies of which will be filed as exhibits to the company’s
next periodic report.

Ionic Ventures, LLC Securities Purchase Agreement and 12% Convertible Promissory
Note

On March 21, 2022, the Company entered into a securities purchase agreement (the
“Ionic SPA”), dated as of March 21, 2022, with Ionic Ventures, LLC (“Ionic”),
pursuant to which the Company issued a 12% promissory convertible note (the
“Ionic Note”) with a maturity date of September 21, 2022 (the “Ionic Maturity
Date”), in the principal sum of $110,000.00. In addition, the Company issued 935
shares of its common stock to Ionic as a commitment fee pursuant to the Ionic
SPA. Pursuant to the terms of the Ionic Note, the Company agreed to pay to Ionic
$110,000.00 and to pay interest on the principal balance at the rate of 12% per
annum (provided that the first six months of interest ($6,600.00) shall be
guaranteed and the remaining 6 months of interest shall be deemed earned in full
as of the Issue Date thereof. The Ionic Note carries an original issue discount
of $10,000.00. Accordingly, Ionic paid the purchase price of $100,000.00 in
exchange for the Ionic Note. The Company intends to use the proceeds for working
capital. Ionic may convert the Ionic Note into the Company’s common stock
(subject to the beneficial ownership limitations of 4.99% in the Ionic Note;
provided however, that the limitation on conversion may be waived (up to 9.99%)
by Ionic upon, at the election of Ionic, not less than 61 days’ prior notice to
the Company) at any time at a conversion price equal to $1.00 per share, as the
same may be adjusted as provided in the Ionic Note.

The Company may prepay the Ionic Note at any time prior to maturity in
accordance with the terms of the Ionic Note. The Ionic Note contains customary
events of default relating to, among other things, payment defaults, breach of
representations and warranties, and breach of provisions of the Ionic Note or
the Ionic SPA.

Upon the occurrence of any Event of Default (as defined in the Ionic Note),
which has not been cured within the time prescribed in the Ionic Note, it shall
become immediately due and payable and the Company shall pay to Ionic, in full
satisfaction of its obligations hereunder, an amount equal to the principal
amount then outstanding plus accrued interest multiplied by 125%.

Ionic Ventures, LLC Common Stock Purchase Warrant

Pursuant to the terms of the Ionic SPA, on March 21, 2022, the Company also
issued to Ionic a three-year warrant (the “Ionic Warrant”) to purchase 50,000
shares of the Company’s common stock at an exercise price of $1.00.

Ionic Ventures, LLC Registration Rights Agreement

Pursuant to the terms of the Ionic SPA, on March 21, 2022, the Company also
entered into a registration rights agreement, dated March 21, 2022, by and
between the Company and Ionic (the “Ionic Registration Rights Agreement”).
Pursuant to the terms of the Ionic Registration Rights Agreement, the Company
agreed to prepare and file with the SEC a registration statement covering the
resale of all shares issued or issuable pursuant to the Ionic SPA, including
shares issued upon conversion of the Ionic Note or upon exercise of the Ionic
Warrant. The Company agreed to use its commercially reasonable efforts to have
the registration statement filed with the SEC within 30 days following March 21,
2022 and to have the registration statement declared effective by the SEC within
60 days following March 21, 2022.

The Ionic Registration Rights Agreement contains customary indemnification
provisions.

The description of the Ionic SPA, the Ionic Note, the Ionic Warrant, and the
Ionic Registration Rights Agreement does not purport to be complete and is
qualified in its entirety by reference to the Ionic SPA, the Ionic Note, the
Ionic Warrant, and the Ionic Registration Rights Agreement, copies of which will
be filed as exhibits to the company’s next periodic report.

Labrys Amendment

As previously disclosed in the Company’s Current Report on Form 8-K filed by the
Company on February 24, 2021 with the Securities and Exchange Commission (the
“SEC”), on February 19, 2021, the Company and Labrys Fund, LP (“Labrys”) entered
a securities purchase agreement (the “Labrys SPA”), pursuant to which the
Company issued a 12% promissory note (the “Labrys Note”) with a maturity date of
February 19, 2022 in the principal sum of $1,650,000. As of March 16, 2022, the
Company and Labrys entered into Amendment #2 (the “Labrys Amendment”) to the
Labrys SPA and the Labrys Note, as amended. Pursuant to the terms of the Labrys
Amendment, the maturity date of the Labrys Note was extended to the earlier of
(i) September 15, 2022, and (ii) the date that the Company’s common stock is
listed on the Nasdaq Stock Market or the New York Stock Exchange. In addition,
the Labrys Note was amended to provide that Labrys has the right, at any time on
or following the date that an event of default occurs under the Labrys Note, as
amended, to convert all or any portion of the then outstanding and unpaid
principal and interest into common stock, subject to a 4.99% equity blocker. In
the Labrys Amendment, the parties also agreed that the Company has already
received cash proceeds in excess of the $2,000,000 minimum threshold referenced
in the Labrys Note. Pursuant to the terms of the Labrys Amendment, Labrys waived
its rights to receive any portion of the next $750,000 of cash proceeds received
by the Company to the extent that such amounts are received by the Company
between March 15, 2022 and April 9, 2022.

Except as set forth in the Labrys Amendment, the Labrys Note, as amended,
remains in full force and effect.

The description of the Labrys Amendment does not purport to be complete and is
qualified in its entirety by reference to the Labrys Amendment, a copy of which
will be filed as an exhibit to the company’s next periodic report.

Lucas Ventures Note Amendment

As previously disclosed in the Company’s Current Report on Form 8-K filed by the
. . .

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.

The disclosures set forth under Item 1.01 of this Current Report on Form 8-K
with respect to the FirstFire Global Note, GS Capital Note, Ionic Note, Labrys
Amendment, Lucas Ventures Amendment and LGH Amendment are incorporated herein by
reference.

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