LAWSUITS KEEP COMING...! DEFAULT PAYMENTS TOTAL SCAM!
Recently, SurgePays, Inc. (the “Company”) entered into a Mutual Release and Settlement Agreement (the “Settlement Agreement”) with AltCorp Trading, LLC (“AltCorp”) and Stanley Hills, LLC (“Stanley Hills,” and together with AltCorp, the “Plaintiffs”), pursuant to which the Plaintiffs agreed to resolve their claims against the Company related to the litigation styled as AltCorp Trading, LLC, et al. v. Surge Holdings, Inc., Case No. A-20- 823039-B, pending in Department 13 of the Eighth Judicial District Court for Clark County (the “Claims”). Although the Settlement Agreement was signed on January 1, 2021, it became fully effective upon the court entering an order dismissing the case on January 19, 2021.
The Settlement Agreement provides that the Company shall pay to AltCorp an amount of its common stock, par value $0.001 per share (the “Common Stock”) equal to $3,300,000 in resolution of the Claims (the “Payment”). Pursuant to the terms of the Settlement Agreement the Company has the option to pay a portion of the Payment in cash.
As previously disclosed in a Current Report on Form 8-K filed by the Company on June 29, 2020, the Company had agreed to exchange $2,750,000 of principal (and related interest, fees, and expenses) of a promissory note held by AltCorp for 5,500,000 shares of Common Stock. AltCorp agreed to a one-year lock-up on the 5,500,000 shares. At the expiration of the lock-up period, in the event the VWAP for the Common Stock was, during the preceding twenty day trading period, at less than $0.50 per share, AltCorp would have the right to receive additional shares of Common Stock equal to the True-Up Value (as defined in the exchange agreement filed as an exhibit to such June 29, 2020 8-K). The Company agreed, in June 2020, to reserve 22,000,000 shares of Common Stock with the Company’s transfer agent for purposes of AltCorp receiving the True-Up Value (the “Share Reserve”).
