EZTD Inc (OTCMKTS:EZTD) entered into a Subscription Agreement dated as of October 19, 2016 (the “Subscription Agreement”) with WinnerOption Ltd., a company organized and existing under the laws of the State of Israel (“WinnerOption”), providing for the issuance and sale by WinnerOption to the Company, in a private placement, of an aggregate of 4,996 Ordinary Shares of WinnerOption stock, or approximately 19.99% of WinnerOption’s outstanding Ordinary Shares (collectively, the “Shares”) valued at approximately $1,000,000, in exchange for the Company’s contribution of: (i) certain of its intellectual property relating to social gaming technology, and (ii) payment of $276,000 in cash to WinnerOption at such times after the date of the Subscription Agreement as determined by the Company in consultation with WinnerOption. As a result of its acquisition of the Shares, the Company is subject to the terms of the Shareholders Agreement of WinnerOption (the “Shareholders Agreement”), which includes customary terms and provisions governing the Company’s ownership of the Shares, including restrictions on transferability of the Shares. The Shareholders Agreement also entitles the Company to designate one out of the four directors to serve on WinnerOption’s board of directors.
Shimon Citron, the Company’s Chief Executive Officer, is the current controlling shareholder and a director of WinnerOption. The terms of the transaction between the Company and WinnerOption were approved by a Special Committee of the Company’s Board of Directors of which Mr. Citron was not a member.
