What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-11-14 compared with 2022-08-15 · 563 added, 452 removed, 1322 unchanged (43% of the section changed)

Financial Statements

unaudited financial statements of NextPlat Corp, F/K/A/ Orbsat Corp, (“NextPlat,” the “Company,” “we,”

or “our”), for the three and six months ended June 30, 2022 and for comparable periods in the prior year are included below.

The financial statements should be read in conjunction with the notes to financial statements that follow.

unaudited condensed consolidated financial statements of NextPlat Corp, F/K/A/ Orbsat Corp, (“NextPlat,” the

“Company,” “we,” or “our”), for the three and nine months ended September 30, 2022 and for

comparable periods in the prior year are included below.

The financial statements should be read in conjunction with the notes to

financial statements that follow.

CORP AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS AS OF

June 30, 2022

September 30, 2022

December 31, 2021

4 unchanged sentences

Prepaid expenses – current portion

Equity method investment

Other current assets

1 unchanged sentence

Property and equipment, net

Right of use asset

Intangible assets, net

Prepaid expenses – long term portion

Equity method investment

LIABILITIES AND STOCKHOLDERS’ EQUITY

17 unchanged sentences

Common stock, $ 0.0001 par value;

50,000,000 shares authorized, 9,293,096 shares issued and outstanding as of June 30, 2022 and 7,053,146 outstanding at December 31, 2021, respectively)

50,000,000 shares authorized, 9,649,096 shares issued and outstanding as of September 30, 2022 and 7,053,146 outstanding at December 31, 2021

Additional paid-in capital

8 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

COMPREHNSIVE LOSS

Three Months Ended

June 30, 2022

Three Months Ended

June 30, 2021

Six Months Ended

June 30, 2022

Six Months Ended

June 30, 2021

COMPREHENSIVE LOSS

Three Months Ended

June 30, 2022

September 30, 2022

Three Months Ended

June 30, 2021

Six Months Ended

June 30, 2022

Six Months Ended

June 30, 2021

September 30, 2021

Nine months Ended

September 30, 2022

Nine months Ended

September 30, 2021

Cost of sales

8 unchanged sentences

( 2,236,846 )

( 4,532,803 )

( 3,085,111 )

Other (income) expense

4 unchanged sentences

Total other (income) expense

Net loss before income tax expense

$ ( 2,258,840 )

3 unchanged sentences

Provision for income taxes

Net loss before equity net loss of affiliate

( 2,258,840 )

2 unchanged sentences

( 4,567,085 )

Comprehensive Income:

Equity in net losses of affiliate

( 3,454,436 )

2 unchanged sentences

( 2,305,549 )

( 8,219,220 )

( 4,567,085 )

Comprehensive (Loss) Income:

( 5,713,276 )

( 2,305,549 )

( 8,219,220 )

( 4,567,085 )

Foreign currency translation adjustments

9 unchanged sentences

CORP AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

the Six Months Ended June 30, 2022

$0.0001 Par Value

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

the Nine months Ended September 30, 2022

Comprehensive

Stockholders’

Income (Loss)

Balance, December 31, 2021

December 31, 2021

$ ( 21,986,215 )

Issuance of common related to offering

Issuance of common related to restricted stock award

Stock based compensation in relation to restricted stock award

Comprehensive loss

of common related to offering

of common related to restricted stock award

based compensation in relation to options granted

Comprehensive

( 8,219,220 )

Balance, June 30, 2022

September 30, 2022

$ ( 30,205,435 )

the Six Months Ended June 30, 2021

the Nine months Ended September 30, 2021

$0.0001 Par Value

1 unchanged sentence

Stockholders’

Income (Loss)

Balance, December 31, 2020

December 31, 2020

$ ( 13,878,553 )

Issuance common stock from convertible debt

Issuance of common related to offering

Issuance of common for over-allotment

Issuance of warrants for over-allotment

Issuance of common stock from exercise of warrant

Issuance of common for services

Beneficial conversion feature of convertible debt

Comprehensive loss

common stock from convertible debt

of common related to offering

of common for over-allotment

of warrants for over-allotment

of common stock from exercise of warrant

of common stock for exercise of options

based compensation in connection with options granted

based compensation in connection with restricted stock awards

of common stock for services

conversion feature of convertible debt

Comprehensive

( 4,567,085 )

Balance, June 30, 2021

September 30, 2021

$ ( 18,445,638 )

the Three Months Ended June 30, 2022

the Three Months Ended September 30, 2022

$0.0001 Par Value

1 unchanged sentence

Stockholders’

Income (Loss)

Balance, March 31, 2022

June 30, 2022

$ ( 24,492,159 )

Stock based compensation in relation to restricted stock award

Comprehensive loss

based compensation in relation to restricted stock award

based compensation in relation to options granted

Comprehensive

( 5,713,276 )

Balance, June 30, 2022

September 30, 2022

$ ( 30,205,435 )

the Three Months Ended June 30, 2021

the Three Months Ended September 30, 2021

$0.0001 Par Value

1 unchanged sentence

Stockholders’

Income (Loss)

Balance, March 31, 2021

June 30, 2021

$ ( 16,140,089 )

Issuance common stock from convertible debt

Issuance of common related to offering

Issuance of common for over-allotment

Issuance of warrants for over-allotment

Issuance of common stock from exercise warrant

Comprehensive loss

of common stock related to exercise of options

based compensation for restricted stock awards

based compensation for options granted

of common stock from exercise warrant

Comprehensive

income (loss)

( 2,305,549 )

Balance, June 30, 2021

September 30, 2021

$ ( 18,445,638 )

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

THE SIX MONTHS ENDED

June 30, 2022

June 30, 2021

THE NINE MONTHS ENDED

September 30, 2022

September 30, 2021

CASH FLOWS FROM OPERATING ACTIVITIES:

6 unchanged sentences

Amortization of right to use

Stock based compensation

Stock based compensation in relation to restricted stock awards

Fair value of options granted

Stock issued for services

Share of loss from equity method

Gain on debt extinguishment

14 unchanged sentences

Purchase of property and equipment

Purchase of equity method investment

( 7,000,000 )

Net cash used in investing activities

( 7,471,118 )

CASH FLOWS FROM FINANCING ACTIVITIES:

1 unchanged sentence

Proceeds from (repayments) to note payable, related party, net

Proceeds from exercise of options

Proceeds from common stock offering

6 unchanged sentences

Net increase (decrease) in cash

( 4,798,371 )

Cash beginning of period

16 unchanged sentences

statements not misleading.

The unaudited financial statements for the three and six months ending June 30, 2022, are not necessarily

The unaudited financial statements for the three and nine months ending September 30, 2022, are not necessarily

indicative of the results for the remainder of the fiscal year.

50 unchanged sentences

Our Amazon Marketplaces represented

approximately 49.5 % and 64.6 % of the Company’s revenues during the six months ended June 30, 2022 and 2021, respectively.

years ended December 31, 2021 and 2020, Amazon online marketplaces represented approximately 63.6 % and 73.3 % of total sales, respectively.

We anticipate that these marketplaces will continue to represent a significant portion of our sales for the foreseeable future.

Our e-commerce

storefronts enable us to attract a significantly diversified level of sales from all over the world, ensuring we are not overly reliant

on any single market or sector for our sales revenue.

Furthermore, many products we sell require subscription-based services which allow

us to increase our recurring revenue airtime sales.

consumer behavior drastically changing because of COVID-19, e-commerce traffic witnessed double-digit gains in 2021 and 2020, respectively,

as stores closed and shoppers used digital options.

This significant change in consumer shopping habits resulted in a substantial increase

of U.S., EU and U.K.

consumers electing to shop online.

During 2021, senior management of the Company determined to invest in a comprehensive

systems upgrade project which commenced in September with the goal of building a state-of-the-art e-commerce platform.

This implementation

is anticipated to be substantially complete within the next six to nine months, and the Company intends to collaborate with businesses

to optimize their ability to sell their goods online, domestically, and internationally, and enabling customers and partners to optimize

their e-commerce presence and revenue.

intend to develop a next generation platform for digital assets built for Web3, an internet service built using decentralized blockchains.

Our new platform (“NextPlat Digital”), which is currently in the design and development phase in collaboration with consultants

and contracted developers, will initially enable the use of non-fungible tokens (“NFTs”), in e-commerce and in community-building

NextPlat Digital may in the future also enable the posting and use of other digital or “crypto” assets once applicable

legal and regulatory requirements are addressed.

As currently contemplated, NextPlat Digital will facilitate the creation/minting, purchase

and sale of a broad range of non-yield-generating and non-fractionalized NFT products, including, but not limited to, art, music, collectables,

digital real estate, video games, game items and certificates of authenticity.

We also anticipate developing and deploying NFTs for use

in tokenizing data for use in brand loyalty programs.

Digital, as currently planned, will be used by us to create both (a) public marketplaces, for us and third-parties, where anyone with

a crypto wallet or credit card can buy an NFT from an authorized user, or, if authorized, sell their own NFTs, and (b) private market

places that only allow a particular company or entity to sell their own NFTs within a branded market (such as for the promotion of a

particular brand or product).

We anticipate that NextPlat Digital will be substantially complete within the next six to nine months.

legal status of NFTs under a myriad of state and federal laws and regulatory regimes (including securities, banking, and commodities

laws) is highly uncertain and unresolved, and the applicability of various of those regimes to any NFTs that we may propose to post on

our platform is also unresolved.

Our creation and operation of NextPlat Digital will present a number of new regulatory and legal compliance

obligations for the Company.

As an initial matter we will need to make a determination whether a particular NFT could reasonably be considered

a security for federal and state law purposes, and if so we would be required to comply with the applicable securities registration requirements

or obtain comfort that our activities would fall within applicable exemptions from registration.

To the extent that we determine that

a particular NFT could be deemed a “security” within the meaning of the U.S.

federal and/or securities laws, we intend to

obtain contractual comfort from licensed broker-dealer authorized to act as a trading system for those digital assets that such broker-dealer

will comply with the applicable “Know Your Customer” (“KYC”) rules and custom and practice, as well as with the

applicable Anti-Money Laundering laws and regulations (“AML”) and Combating the Financing of Terrorism (“CFT”),

administered and enforced by the U.S.

Treasury Financial Crimes and Enforcement Network discussed below, among others.

We may have legal

exposure for any alleged failures on the part of such licensed broker-dealer to fulfil its obligations under its contracts with us.

respect to the securities status of an NFT that we propose to post to our platform, we will follow an internally developed model that

will permit us to make a risk-based assessment regarding the likelihood that a particular NFT could be deemed a “security”

within the meaning of the U.S.

federal and/or state securities laws in determining if and how an NFT can be posted on our platform.

process will involve employees trained to identify the indicia of a “security” who will also work with outside legal counsel

experienced in crypto asset regulatory matters to make a determination with respect to each NFT, or category of NFT, proposed to be posted

on our platform.

These processes and procedures are risk-based assessments and are not a legal standard or binding on regulators or courts.

In the event an NFT or other digital asset is deemed by us, pursuant to the above analysis, to possess a reasonable likelihood of being

deemed a security, we will (a) comply with applicable laws and regulations by forming, acquiring or engaging a licensed broker-dealer

authorized to act as an trading system for those digital assets, or (b) transact in such digital assets offshore in a way that complies

with applicable laws and regulations;

or (c) not transact in the subject NFT.

We expect our risk assessment policies will continuously

evolve to take into account developments in case law, applicable facts, developments in technology, and changes in applicable regulatory

do not currently intend to undertake or participate in “initial coin offerings”, the minting of “coins” or the

mining of cryptocurrencies.

of a particular NFT’s status as a security, we will need to assess whether we needed to comply with other applicable regulations

and laws (including but not limited to AML and CFT regulations).

If we are deemed to be involved in the exchange or transmission of value

that substitutes for currency, or fall under other evolving requirements, we may be deemed to be a “money transmitter” and

will be subject to AML and CFT regulations.

Depending on the particular attributes of an NFT, the manner in which it is marketed, and

the nature of the clientele, we could be subject to other legal and regulatory regimes as well.

We will endeavor to comply with all applicable

laws in connection with our NextPlat Digital business, but the uncertain application of those laws to our proposed business may create

substantial risk to the Company.

onboarding new users, we intend to utilize third-party tools to proactively screen for high-risk crypto wallets, including explicitly

sanctioned addresses and addresses associated with sanctioned entities.

Crypto wallets protect the identity of the owner of the wallet,

store the owner’s private keys, secure and provide access by the owner to the cryptocurrency owned by it and allow the owner to

send, receive, and transact business with cryptocurrencies.

Such wallets by their nature obfuscate the identity of the owner of the wallet

and limit access to the transaction history of that wallet and its owner.

Consequently, crypto wallets and cryptocurrencies may be used

by persons seeking to avoid legal oversight and to violate the law.

For example, they can be used to launder money and to promote terrorism.

The applicable legal requirements and our compliance obligations will vary depending on the nature of the client, the service or product

provided and jurisdiction.

For example, if we engage, form or acquire a broker dealer in order to post, trade or sell NFTs or other digital

assets that are securities, we will attempt to fully comply with all applicable KYC, AML and CFT compliance requirements.

other hand, we facilitate the distribution of free promotional corporate collectable NFTs that are not deemed to be securities, our compliance

requirements will be significantly less.

In either event there can be no assurance that our efforts to fully comply with applicable law

will be successful.

determining to engage in transactions in an NFT, we will attempt to comply with all applicable laws.

However, given the substantial legal

uncertainties that may presented by those laws and given the informational constraints presented by crypto wallets we may not be successful

in our efforts.

As a consequence, we may be exposed to regulatory enforcement and civil or criminal sanction should a legal authority

determine that our approach is inadequate or inappropriate, as well as to claims asserting civil liability.

Moreover, governmental agencies

may seek to apply laws to our NextPlat Digital business that we believe are inapplicable and may seek sanctions relating to our alleged

failure to comply with those laws.

approximately 52.3 %

of the Company’s revenues during the nine months ended September 30, 2022 and 2021, respectively.

For the years ended December

31, 2021 and 2020, Amazon online marketplaces represented approximately 63.6 %

of total sales, respectively.

We anticipate that these marketplaces will continue to represent a significant portion of our sales for

the foreseeable future.

Our e-commerce storefronts enable us to attract a significantly diversified level of sales from all over the

world, ensuring we are not overly reliant on any single market or sector for our sales revenue.

Furthermore, many products we sell require

subscription-based services which allow us to increase our recurring revenue airtime sales.

CORP AND SUBSIDIARIES

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Communications

43 unchanged sentences

communicate via voice and data applications.

CORP AND SUBSIDIARIES

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

are a provider of GPS enabled emergency locator distress beacons that can save lives, on land and at sea.

48 unchanged sentences

a newly formed wholly owned subsidiary.

CORP AND SUBSIDIARIES

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 24, 2021, the Company’s shareholders via majority shareholder consent authorized a stock split not to exceed 1 for 5 reverse

2 unchanged sentences

Board of Directors subsequently approved a 1-for-5 reverse stock split.

The Company has filed a Certificate of Change to its Amended

and Restated Articles of Incorporation to effect a reverse stock split of its issued and outstanding common stock, at a ratio of 1-for-5 .

The Company filed a Certificate of Change to its Amended and

Restated Articles of Incorporation to effect a reverse stock split of its issued and outstanding common stock, at a ratio of 1-for-5 .

The effective time of the reverse stock split was 12:01 a.m.

5 unchanged sentences

No fractional shares of common stock were issued as a result of the reverse

Stockholders of record who would otherwise be entitled to receive a fractional share were received a whole share.

Stockholders of record who would otherwise be entitled to receive a fractional share received a whole share.

January 18, 2022, the Company filed a Certificate of Amendment of the Amended and Restated Articles of Incorporation of the Company with

6 unchanged sentences

B.V., has no active operations.

information presented in this Quarterly Report on Form 10-Q other than in Company’s consolidated financial statements and the notes

thereto assumes a 1-for-5 reverse stock split of Company’s outstanding shares of common stock and unless otherwise indicated, all

such amounts and corresponding conversion price or exercise price data set forth in this Quarterly Report on Form 10-Q have been adjusted

to give effect to such assumed reverse stock split.

September 2, 2022, the Company closed a transaction with Progressive Care Inc.

RXMD) (“Progressive Care”), pursuant to which

we purchased 3,000 newly issued units of securities from Progressive Care (the “Units”) at a price per Unit of $ 2,000 for

an aggregate purchase price of $ 6 million (the “Unit Purchase”).

Each Unit consists of one share of Series B Convertible

Preferred Stock of Progressive Care (“Series B Preferred Stock”) and one warrant to purchase a share of Series B Preferred

Stock (“RXMD Warrants”).

share of Series B Preferred Stock votes as a class with the common stock of Progressive Care, and has 100,000 votes per share.

each share of Series B Preferred Stock is convertible into 100,000 shares of Progressive common stock.

In addition, the Series B Preferred

Stock has a liquidation and dividend preference.

The RXMD Warrants have a five-year term, and are immediately exercisable, in whole or

in part, and contain cashless exercise provisions.

Each Warrant is exercisable at $ 2,000 per share of Series B Preferred Stock.

the consummation of the Unit Purchase, our Chairman and Chief Executive Officer, Charles M.

Fernandez, and our board member, Rodney

Barreto, were appointed to Progressive Care’s Board of Directors, with Mr.

Fernandez appointed to serve as Chairman of

Progressive Care’s Board of Directors and Mr.

Barreto appointed to serve as a Vice Chairman of Progressive Care’s Board

of Directors.

On November 11, 2022, the Progressive Care board of directors elected Mr.

Fernandez to serve as the Chief Executive Officer of Progressive Care.

addition, on September 2, 2022, NextPlat, Charles Fernandez, Rodney Barreto and certain other purchasers purchased from Iliad Research

and Trading, L.P.

(“Iliad”) a Secured Convertible Promissory Note, dated March 6, 2019, made by Progressive Care to Iliad

(the “Note”).

The accrued and unpaid principal and interest under the note at the time of the purchase was approximately

$ 2.79 million.

The aggregate purchase price paid to Iliad for the Note was $ 2.3 Million of which NextPlat contributed $ 1 million and

Fernandez and Barreto contributed $ 400,000 each (the “Note Purchase”).

connection with the Note Purchase, NextPlat, Messrs.

Fernandez and Barreto and the other purchasers of the Note entered into a Debt Modification

Agreement with Progressive Care.

Pursuant to the Debt Modification Agreement, the interest rate under the Note was reduced from 10 % to

5 % per annum and the maturity date was extended to May 31, 2027.

In addition, the conversion price under the note was changed to $ 0.02

per share of Common Stock.

Pursuant to the Debt Modification Agreement, NextPlat, Messrs.

Fernandez and Barreto and the other purchasers

of the Note have the right, exercisable at any time, to redeem all or any portion of the Note.

The Debt Modification Agreement also provides

that the Note will automatically convert upon the later to occur of:

(a) the completion by Progressive Care of a reverse stock split,

and (b) the listing of Progressive Care’s common stock on a national exchange.

In consideration of the concessions in the Debt

Modification Agreement, Progressive Care issued 21,000,000 shares of its common stock to the purchasers of the Note, of which NextPlat,

Charles Fernandez and Rodney Barreto, received 9,130,435 , 3,652,174 , and 3,652,174 shares, respectively.

information presented in this Quarterly Report on Form 10-Q other than in Company’s consolidated financial statements and the

notes thereto assumes a 1-for-5 reverse stock split of Company’s outstanding shares of common stock effective May 28, 2021 and

unless otherwise indicated, all such amounts and corresponding conversion price or exercise price data set forth in this Quarterly

Report on Form 10-Q have been adjusted to give effect to such assumed reverse stock split.

CORP AND SUBSIDIARIES

12 unchanged sentences

Company considers all highly liquid investments with a maturity of three months or less when acquired to be cash equivalents.

places its cash with a high credit quality financial institution.

The Company’s account at this institution is insured by the Federal

Deposit Insurance Corporation (“FDIC”) up to $ 250,000 .

All cash amounts in excess of $ 250,000 , $ 19,920,186 , are unsecured.

To reduce its risk associated with the failure of such financial institution, the Company evaluates at least annually the rating of the

financial institution in which it holds deposits.

Company places its cash with a high credit quality financial institution.

The Company’s account at this institution is insured

by the Federal Deposit Insurance Corporation (“FDIC”) up to $ 250,000 .

All cash amounts in excess of $ 250,000 ,

($ 11,884,437 at September 30, 2022), are

To reduce its risk associated with the failure of such financial institution, the Company evaluates at least annually the

rating of the financial institution in which it holds deposits.

receivable and allowance for doubtful accounts

5 unchanged sentences

been exhausted and the potential for recovery is considered remote.

As of June 30, 2022, and December 31, 2021, there were no allowances

As of September 30, 2022, and December 31, 2021, there were no allowances

for doubtful accounts.

10 unchanged sentences

value of inventories is recorded to cost of goods sold.

expenses amounted to $ 106,947 and $ 146,935 , at June 30, 2022 and December 31, 2021, respectively.

expenses amounted to $ 109,765 and $ 146,935 , at September 30, 2022 and December 31, 2021, respectively.

Prepaid expenses include prepayments

1 unchanged sentence

portion consists of costs paid for future services which will occur within a year.

Company applies the equity method of accounting to investments when it has significant influence, but not controlling interest, in the

Judgment regarding the level of influence over each equity method investment includes considering key factors such as ownership

interest, representation on the board of directors, participation in policy-making decisions and material intercompany transactions.

The carrying value of our equity method investment is reported as “equity method investment” on the condensed consolidated

balance sheets.

The Company’s equity method investment is reported at cost and adjusted each period for the Company’s share

of the investee’s income or loss and dividend paid, if any.

The Company’s proportionate share of the net loss resulting from

these investments is reported under the line item captioned “equity in net loss of affiliate” in the condensed consolidated

statements of operations and comprehensive loss.

Note 7 contains additional information on the equity method investment.

Company assesses investments for impairment whenever events or changes in circumstances indicate that the carrying value of an investment

may not be recoverable.

Management reviewed the underlying net assets of the investees as of September 30, 2022 and determined that the

Company’s proportionate economic interest in the investees indicate that the investments were not impaired.

Currency Translation

10 unchanged sentences

relevant translation rates are as follows:

for the six months ended June 30, 2022, closing rate at 1.2165 US$:

GBP, quarterly average

rate at 1.256640 US$:

for the three and nine months ended September 30, 2022, closing rate at 1.1150 US$:

GBP, quarterly

average rate at 1.176596 US$:

GBP and yearly average rate at 1.258384444 US$:

GBP, for the six months ended June 30, 2021, closing rate at 1.382800

GBP, for the three and nine months ended September 30,

2021 closing rate at 1.342642 US$:

GBP, quarterly average rate at 1.3784972 US$:

GBP and yearly average rate at 1.3853499 US$:

GBP, for the year ended 2021 closing rate

at 1.353372 US$:

the year ended 2021 closing rate at 1.353372 US$:

GBP, yearly average rate at 1.375083 US$:

63 unchanged sentences

liabilities is shown separately in the unaudited condensed consolidated balance sheets as current liabilities.

At June 30, 2022 and December

31, 2021, we had contract liabilities of approximately $ 27,110 and $ 36,765 , respectively.

At September 30, 2022

and December 31, 2021, we had contract liabilities of approximately $ 35,009 and $ 36,765 , respectively.

of Product Sales and Services

43 unchanged sentences

The Company did not consider it necessary to record any impairment charges during the periods

ended June 30, 2022 and June 30, 2021, respectively.

ended September 30, 2022 and September 30, 2021, respectively.

for Derivative Instruments

19 unchanged sentences

fair value of the award.

to ASC Topic 718, for share-based payments to consultants and other third-parties, compensation expense is determined at the “measurement

date.” The expense is recognized over the vesting period of the award.

Until the measurement date is reached, the total amount

of compensation expense remains uncertain.

The Company initially records compensation expense based on the fair value of the award at

the reporting date.

Further, ASC Topic 718, provides guidance about which changes to the terms or conditions of a share-based payment

award require an entity to apply modification accounting in Topic 718, such as the repricing of share options, which would revalue those

options and the accounting for the cancellation of an equity award whether a replacement award or other valuable consideration is issued

in conjunction with the cancellation.

If not, the cancellation is viewed as a replacement and not a modification, with a repurchase price

Company records stock-based payments made to non-employees in accordance with Accounting Standards Update (“ASU”) 2018-07, Compensation-Stock

Compensation (Topic 718):

Improvements to Nonemployee Share-Based Payment Accounting, which aligns accounting for share-based

payments issued to non-employees to that of employees under the existing guidance of Topic 718, with certain exceptions.

Company accounts for income taxes pursuant to the provision of ASC 740-10, “Accounting for Income Taxes” (“ASC 740-10”)

45 unchanged sentences

rent expense on a straight-line basis over the lease term.

June 30, 2022 and December 31, 2021, the Company had aggregated current and long-term operating lease liabilities of $ 899,987 and $ 19,763 ,

respectively, and right of use assets of $ 909,908 and $ 22,643 , respectively.

September 30, 2022 and December 31, 2021, the Company had aggregated current and long-term operating lease liabilities of $ 863,294

and $ 19,763 ,

respectively, and right of use assets of $ 865,115

and $ 22,643 ,

respectively.

Company continues to account for leases in the prior period financial statements under ASC Topic 840.

11 unchanged sentences

related to both present and future products are expensed in the period incurred.

For the six months ended June 30, 2022 and the June

30, 2021, there were no expenditures on research and development.

For the nine months ended September 30, 2022 and the

September 30, 2021, there were no expenditures on research and development.

per Common Share

7 unchanged sentences

SCHEDULE OF DILUTIVE COMMON STOCK EQUIVALENTS

June 30, 2022

June 30, 2021

September 30, 2022

September 30, 2021

Stock Options

42 unchanged sentences

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

2 - INVENTORIES

June 30, 2022 and December 31, 2021, inventories consisted of the following:

2 - INVENTORY

September 30, 2022 and December 31, 2021, inventories consisted of the following:

SCHEDULE OF INVENTORIES

June 30, 2022

September 30, 2022

December 31, 2021

1 unchanged sentence

Less reserve for obsolete inventory

the six months ended June 30, 2022 and the year ended December 31, 2021, the Company did not make any change for reserve for obsolete

the nine months ended September 30, 2022 and the year ended December 31, 2021, the Company did not make any change for reserve for obsolete

3 – VAT RECEIVABLE

1 unchanged sentence

the EU, (“BREXIT”).

For the six months ended June 30, 2022 and the year ended December 31, 2021, the Company recorded a receivable

in the amount of $ 459,541 and $ 491,417 , respectively, for amounts available to reclaim against the tax liability from UK and EU countries.

Subsequently to June 30, 2022, the Company has received a total of £ 53,473 or $ 64,451 , using an exchange rate close of 1.2053 GBP:USD,

in regards to this receivable.

For the nine months ended September 30, 2022 and the year ended December 31, 2021, the Company recorded

a receivable in the amount of $ 355,118 and $ 491,417 , respectively, for amounts available to reclaim against the tax liability from UK

and EU countries.

4 – PREPAID EXPENSES

expenses amounted to $ 106,947 and $ 146,935 , at June 30, 2022 and December 31, 2021, respectively.

expenses amounted to $ 109,765 and $ 146,935 , at September 30, 2022 and December 31, 2021, respectively.

Prepaid expenses include prepayments

2 unchanged sentences

5 – PROPERTY AND EQUIPMENT

June 30, 2022 and December 31, 2021, property and equipment, net of fully depreciated assets, consisted of the following:

September 30, 2022 and December 31, 2021, property and equipment, net of fully depreciated assets, consisted of the following:

SCHEDULE OF PROPERTY AND EQUIPMENT

June 30, 2022

September 30, 2022

December 31, 2021

7 unchanged sentences

( 1,502,501 )

expense was $ 199,065 and $ 134,448 for the six months ended June 30, 2022 and 2021, respectively.

expense was $ 329,272 and $ 206,654 for the nine months ended September 30, 2022 and 2021, respectively.

For the year ended December 31,

19 unchanged sentences

of customer contracts are included in depreciation and amortization.

For the six months ended June 30, 2022 and 2021, the Company amortized

$ 12,500 and $ 12,500 , respectively.

For the nine months ended September 30, 2022 and 2021, the Company

amortized $ 18,750 and $ 18,750 , respectively.

Future amortization of intangible assets is as follows:

SCHEDULE OF FUTURE AMORTIZATION OF INTANGIBLE ASSETS

the six months ended June 30, 2022 and 2021, there were no additional expenditures on research and development.

the nine months ended September 30, 2022 and 2021, there were no additional expenditures on research and development.

7 – EQUITY METHOD INVESTMENT IN PROGRESSIVE CARE, INC.

AND SUBSIDIARIES

(a publicly traded company) is a personalized healthcare services and technology company that provides prescription

pharmaceuticals and risk and data management services to healthcare organization and providers.

On August 30, 2022 the Company

entered into a Securities Purchase Agreement (the “SPA”) with

Progressive Care, Inc.

(“Progressive”), which subsequently closed on September 2, 2022, pursuant to which the Company purchased 3,000 newly issued units of securities from

Progressive at a price per unit of $ 2,000 , for an aggregate purchase price of $ 6,000,000 .

unit consists of one share of Progressive Series B Convertible Preferred Stock (“Series B Preferred Stock”) and one

warrant to purchase a share of Progressive Series B Preferred Stock (“Warrants”).

Each share of Series B Preferred Stock

will vote as a class with the common stock of Progressive, and will have 100,000 Progressive votes per share, and each share of

Series B Preferred Stock will be convertible into 100,000 shares of Progressive’s common stock.

The Warrants are exercisable

at a price of $ 2,000 per share of Series B Preferred Stock have a five-year term, and are immediately exercisable, in whole or in

part, and contain cashless exercise provisions.

The Company determined the Series B Preferred Stock is in-substance common stock

because the Series B Preferred Stock has similar risk and reward characteristics to common stock.

to the SPA, NextPlat’s Chairman and Chief Executive Officer, Charles M.

Fernandez and board member, Rodney Barreto, were appointed

to Progressive’s Board of Directors as Chairman of the Company’s Board of Directors and Vice Chairman, respectively.

November 11, 2022, the Progressive Care board of directors elected Mr.

Fernandez to serve as the Chief Executive Officer of Progressive

addition, on September 2 , 2022, NextPlat, entered into a Confidential Purchase and Release Agreement (the “NPA”) with a third-party

lender to Progressive pursuant to which NextPlat agreed to purchase $ 1,000,000 of Progressive’s principal convertible debt from

the third-party (the “Note Purchase”) and was issued 9,130,435 of Progressive common stock.

NextPlat paid an aggregate of

$ 1,000,000 for the Note Purchase and common stock.

The convertible note receivable has a principal balance of $ 1,213,429 , carries a simple

interest rate of 5 %, is convertible at $ 0.02 per share of common stock, and matures on August 31, 2027 .

a result of the SPA and related transactions, the Company paid an aggregate of $ 7,000,000 for an economic and voting interest in Progressive

The board seats, combined with the Company’s ownership interest of 33.28 % provide the Company with significant influence

over Progressive, but not a controlling interest.

Progressive does not depend on the Company for continuing financial support to maintain operations as of September 30, 2022, the Company

has determined that Progressive is not a variable interest entity, and therefore, the Company is not required to determine the primary

beneficiary of Progressive for potential consolidation.

Based on quoted market prices, the market value of the Company’s ownership

interest in Progressive was approximately $ 11.7 million at September 30, 2022.

Company combined its investment in the Series B Preferred Stock, common stock, warrants, and convertible note receivable into one line

item on the condensed consolidated balance sheets as “Equity method investment”.

The Company reported its aggregate earnings

from its investment as one line item on the condensed consolidated statement of operations as “Equity in net loss of affiliate”.

CORP AND SUBSIDIARIES

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

7 – EQUITY METHOD INVESTMENT IN PROGRESSIVE CARE, INC.

AND SUBSIDIARIES (continued)

following summarizes the Company’s condensed consolidated balance sheet description equity method investment as follows:

OF DESCRIPTION EQUITY METHOD INVESTMENT

30, 2022, beginning balance

of income from Progressive Care, Inc.

and Subsidiaries

( 3,453,172 )

expense due to cost basis difference (1)

earned from convertible note receivable

earned from amortization of premium on convertible note receivable

of intercompany interest earned

30, 2022, carrying amount

method investment – short term

method investment – long term

following summarizes the Company’s condensed consolidated statements of operations and comprehensive loss description equity in

net loss of affiliate for the three and nine months ended September 30, 2022 as follows:

the Three and Nine Months Ended

in net loss of affiliate

$ ( 3,453,172 )

expense due to cost basis difference (1)

earned from convertible note receivable

earned from amortization of premium on convertible note receivable

of intercompany interest earned

in net loss of affiliate

$ ( 3,454,436 )

records depreciation expense on its estimated cost basis difference which is subject to change

Company did not have any equity in net loss of affiliate for the three and nine months ended September 30, 2021.

8 - ACCOUNTS PAYABLE AND ACCRUED OTHER LIABILITIES

1 unchanged sentence

SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED OTHER LIABILITIES

June 30, 2022

September 30, 2022

December 31, 2021

31 unchanged sentences

Upon the occurrence of an Event of Default, the Debenture becomes payable upon demand.

As of June 30, 2022, and December 31, 2021, the

Company has recorded $ 60,825 and $ 56,391 as current portion of notes payable and $ 187,544 and $ 253,757 as notes payable long term, respectively.

As of September 30, 2022, and December 31, 2021,

the Company has recorded $ 55,750 and $ 56,391 as current portion of notes payable and $ 157,958 and $ 253,757 as notes payable long term,

respectively.

May 8, 2020, NextPlat Corp was approved for the US funded Payroll Protection Program, (“PPP”) loan.

50 unchanged sentences

preferred stock, par value $ 0.0001 per share.

As of June 30, 2022, and December 31, 2021, there were and 9,293,096 and 7,053,146 shares

of common stock and 0 shares of preferred stock issued and outstanding, respectively.

of June 30, 2022, there were 3,333,333 shares of Preferred Stock authorized.

of June 30, 2022, there were no shares of Series A, B, C, D, E, F, G, H, I, J, K and L convertible preferred stock authorized, and no

shares issued and outstanding.

CORP AND SUBSIDIARIES

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

9 - STOCKHOLDERS’ EQUITY (continued)

of June 30, 2022, there were 2,836,092 registered warrants to purchase common stock authorized of which 2,530,092 registered warrants

As of September 30, 2022, and December 31, 2021, there were 9,649,096 and 7,053,146

shares of common stock and 0 shares of preferred stock issued and outstanding, respectively.

of September 30, 2022, there were 3,333,333 shares of Preferred Stock authorized.

of September 30, 2022, there were no shares of Series A, B, C, D, E, F, G, H, I, J, K and L convertible preferred stock authorized, and

no shares issued and outstanding.

of September 30, 2022, there were 3,312,000 registered warrants to purchase common stock authorized of which 2,386,092 registered warrants

were issued and outstanding, at an exercise price of $ 5.00 and unregistered underwriter warrants of 144,000 issued and outstanding, at

1 unchanged sentence

The warrants expire in June of 2026.

summary of the status of the Company’s total outstanding warrants and changes during the year ended December 31, 2021 and the six

months ended June 30, 2022 is as follows:

summary of the status of the Company’s total outstanding warrants and changes during the year ended December 31, 2021 and the nine

months ended September 30, 2022 is as follows:

SCHEDULE OF OUTSTANDING STOCK WARRANTS ACTIVITIES

Average Exercise

Balance at January 1, 2021

1 unchanged sentence

Balance at January 1, 2022

Balance outstanding and exercisable at June 30, 2022

of June 30, 2022, there were 50,000,000 shares of common stock authorized and 9,293,096 shares issued and outstanding.

Balance outstanding and exercisable at September 30, 2022

CORP AND SUBSIDIARIES

TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

10 - STOCKHOLDERS’ EQUITY (continued)

of September 30, 2022, there were 50,000,000 shares of common stock authorized and 9,649,096 shares issued and outstanding.

2022 Private Placement of Common Stock

28 unchanged sentences

ended December 31, 2021.

January 21, 2022, the Company issued 10,000 shares of common stock, pursuant to a restricted stock award, “RSA” granted on January

January 21, 2022, the Company issued 10,000

shares of common stock to Mr.

Rodney Barreto, pursuant to a restricted stock award, “RSA,” granted on January 7, 2022

and effective on January 20, 2022.

The award is for 20,000 restricted shares of common, which vest in two equal installments,

the first on effective date and the remaining on the one year anniversary of the effective date, with a fair market value

of $ 3.48 per share, on the date of issuance.

The award is for 20,000

restricted shares of common, which vest in two equal installments, the first on the effective date and the remaining on the one year

anniversary of the effective date, with a fair market value of $ 3.48

per share, on the date of issuance.

All shares were fully vested and upon issuance resulted in stock-based compensation of $ 34,800 .

Shares were issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended,

as there was no general solicitation, and the transaction did not involve a public offering.

On May 23, 2021, the Company entered a three ( 3 ) year

Employment Agreement (the “May Agreement”) with Mr.

Fernandez to serve as Chairman of the Board.

However, two weeks

later on June 2, 2021, the Company entered into a new employment agreement (the “June Agreement”) with Mr.

Fernandez, which

superseded and replaced “the May Agreement.” The June Agreement has an initial term of 5 years effective on May 28, 2021.

Fernandez received the award of restricted stock with a grant date fair value equal to $ 3,000,000 determined at the per unit offering

price in the June Offering ($ 5 per Unit) (the “RSA”), which RSA will vest 1/3 at each of the three anniversaries of the grant

The Grant Date for the RSA is May 28, 2021, as determined pursuant to the June Agreement.

Notwithstanding the vesting schedule,

full vesting will occur upon a Change in Control, as that term is defined in the Restricted Stock Agreement pursuant to which the RSA

was made (the “June Restricted Stock Agreement”).

Fernandez’s employment is terminated for any reason at any

time by the Company prior to the full vesting of the RSA without “Cause” (as that term is defined in the June Agreement),

the RSA will vest and Mr.

Fernandez will receive all right, title and interest in the balance of the securities granted to him in the

RSA, in regard to the restricted stock award.

The Company at its sole expense is obligated to register for reoffer and resale by Mr.

the securities granted to him pursuant to the May Restricted Stock Agreement.

the six months ended June 30, 2022, pursuant to Mr.

Fernandez employment agreement, the “June Agreement”, see Note 12,

the Company recorded stock-based compensation and additional paid in capital, in the amount of $ 654,246 .

The value of the award for

the six months ended June 30, 2022 and the year ended December 31, 2021 was $ 297,534 and $ 356,712 , respectively.

The company has

charged the full valuation since inception to its current period.

The prior year charge had not been recognized and was deemed as

immaterial in scope for further adjustments.

The award is valued over the

service period of the June Agreement, five years from the date of grant, May 28, 2021.

On May 28, 2022, 200,000 of the RSA or one

third of the award, became vested and issuable.

On July 22, 2022, the Company issued 200,000 of restricted common stock, see Note

Shares were issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as

amended, as there was no general solicitation, and the transaction did not involve a public offering.

May 23, 2021, the Company entered a three ( 3 ) year Employment Agreement (the “May Agreement”) with Mr.

to serve as Chairman of the Board.

However, two weeks later on June 2, 2021, the Company entered into a new employment agreement (the

“June Agreement”) with Mr.

Fernandez, which superseded and replaced “the May Agreement.” The June Agreement has

an initial term of 5 years effective on May 28, 2021.

Fernandez received the award of restricted stock with a grant date fair value

equal to $ 3,000,000 determined at the per unit offering price in the June Offering ($ 5 per Unit) (the “RSA”), which RSA will

vest 1/3 at each of the three anniversaries of the grant date.

The Grant Date for the RSA is May 28, 2021, as determined pursuant to

the June Agreement.

Notwithstanding the vesting schedule, full vesting will occur upon a Change in Control, as that term is defined in

the Restricted Stock Agreement pursuant to which the RSA was made (the “June Restricted Stock Agreement”).

employment is terminated for any reason at any time by the Company prior to the full vesting of the RSA without “Cause” (as

that term is defined in the June Agreement), the RSA will vest and Mr.

Fernandez will receive all right, title and interest in the balance

of the securities granted to him in the RSA, in regard to the restricted stock award.

The Company at its sole expense is obligated to

Fernandez the securities granted to him pursuant to the May Restricted Stock Agreement.

July 22, 2022, pursuant to Mr.

Fernandez employment agreement, the “June Agreement”, see Note 13, the Company issued 200,000

restricted shares and recorded stock-based compensation in the amount of $ 805,246 to eAperion Partners LLC, of which Mr.

managing director.

This amount is valued from the date of the award May 28, 2021 to September 30, 2022.

The value of the award for the

year ended December 31, 2021 was $ 356,712 and for the nine months ended September 30, 2022, $ 448,534 .

The award is valued over the service

period of the June Agreement, five years from the date of grant, May 28, 2021.

On June 2, 2022, 200,000 of the RSA or one third of the

award, became vested and issuable.

August 4, 2022, the Company issued 15,000 restricted shares to Andrew Cohen, pursuant to a restricted stock award which became fully

vested upon his resignation, see Note 13.

The award resulted in stock based compensation of $ 76,950 and was valued as of the date of

the award on October 8, 2021.

September 20, 2022, the Company issued 116,000 restricted shares of common stock to eAperion Partners LLC, of which Charles M.

is managing partner, pursuant to a restricted stock award, “RSA,” under the Company’s 2020 Equity Incentive Plan.

shares were fully vested upon issuance.

The shares were valued at the market close of issuance date of $ 2.52 per share, resulting in

stock-based compensation of $ 292,320 .

September 28, 2022, the Company issued 20,000 restricted shares to Douglas Ellenoff, pursuant to such award as granted on August 24,

2021, using the fair market value as of date of the award of $ 5.37 per share, resulting in stock-based compensation of $ 107,400 .

on September 28, 2022, the Company issued 5,000 restricted shares to Paul Thomson, pursuant to such award as granted on August 24, 2021,

using the fair market value as of date of the award of $ 5.37 per share, resulting in stock-based compensation of $ 26,850 .

CORP AND SUBSIDIARIES

1 unchanged sentence

10 - STOCKHOLDERS’ EQUITY (continued)

summary of the status of the Company’s outstanding stock options and changes during the six months ended June 30, 2022 is as follows:

summary of the status of the Company’s outstanding stock options and changes during the nine months ended September 30, 2022 is

SCHEDULE OF OUTSTANDING STOCK OPTIONS ACTIVITIES

Weighted Average

Balance at January 1, 2021

1 unchanged sentence

Balance at January 1, 2022

Balance outstanding and exercisable at June 30, 2022

Balance outstanding and exercisable at September 30, 2022

11 - STOCK SUBSCRIPTION PAYABLE

5 unchanged sentences

Nasdaq on December 31, 2021.

the six months ended June 30, 2022 and for the year ended December 31, 2021, the Company received gross proceeds of $ 0 and $ 1,400,000

of the $ 7,225,038 , pursuant to the December Offering, respectively.

On January 5, 2022, the Company received an additional $ 5,825,038 ,

resulting in the issuance of 2,229,950 shares of the Company’s common stock, eliminating the stock subscription payable as well

as, the closing of the offering.

the nine months ended September 30, 2022 and for the year ended December 31, 2021, the Company had a stock subscription payable of $ 0

and $ 1,400,000 , respectively.

On January 5, 2022, the Company

received an additional $ 5,825,038 ,

resulting in the issuance of 2,229,950

shares of the Company’s common stock, eliminating

the stock subscription payable as well as, the closing of the offering.

12 - RELATED PARTY TRANSACTIONS

of June 30, 2022, total related party payments due as of June 30, 2022, and December 31, 2021, are $ 0

and $ 35,308 ,

respectively.

of September 30, 2022, total related party payments due as of September 30, 2022, and December 31, 2021, were $ 15,692 and $ 35,308 , respectively.

The payments due were accrued salary.

These related party payables were non-interest bearing.

9 unchanged sentences

These three individuals earned gross wages totaling $ 99,965 and $ 107,042

for the six months ended June 30, 2022 and 2021, respectively.

Company retained the services of the spouse of Mr.

Fernandez for consulting fees of $ 8,960 for the six months ended June 30, 2022.

for the nine months ended September 30, 2022 and 2021, respectively.

July 12, 2022, the Company hired Lauren Sturges Fernandez, the spouse of Mr.

Fernandez, as Manager of Digital Assets.

is an at-will employee with an annual salary of $ 95,000 .

On September 22, 2022, Mrs.

Fernandez’s title was changed to Chief of

Staff and Special Assistant to the Chairman of the Board, her salary remains the same.

the consummation of the Company’s investment in Progressive Care Inc.

on September 2, 2022, our Chairman and Chief Executive

Officer, Charles M.

Fernandez, and our board member, Rodney Barreto, were appointed to Progressive Care’s Board of Directors,

Fernandez appointed to serve as Chairman of Progressive Care’s Board of Directors and Mr.

Barreto appointed to serve

as a Vice Chairman of Progressive Care’s Board of Directors.

On November 11, 2022, the Progressive Care board of directors

Fernandez as the Chief Executive Officer of Progressive Care.

In addition, on September 2, 2022, NextPlat, Messrs.

Fernandez and Barreto and certain other purchasers purchased from Iliad Research and Trading, L.P.

Secured Convertible Promissory Note, dated March 6, 2019, made by Progressive Care to Iliad (the “Note”).

and unpaid principal and interest under the note at the time of the purchase was approximately $ 2.79

The aggregate purchase price paid to Iliad for the Note was $ 2.3

Million of which NextPlat contributed $ 1

million and Messrs.

Fernandez and Barreto contributed $ 400,000

each (the “Note Purchase”).

In connection with the Note Purchase, NextPlat, Messrs.

Fernandez and Barreto and the other

purchasers of the Note entered into a Debt Modification Agreement with Progressive Care.

In consideration of the concessions in the

Debt Modification Agreement, Progressive Care issued 21,000,000

shares of its common stock to the purchasers of the Note, of which NextPlat, Charles Fernandez and Rodney Barreto, received 9,130,435 , 3,652,174 ,

and 3,652,174

shares, respectively.

CORP AND SUBSIDIARIES

28 unchanged sentences

of our business, such as rental sales and direct website sales, and a reduction in personnel due to lockdown related issues.

of operations for the six months ended June 30, 2022 and for the years ended December 31, 2021 and December 31, 2020, reflect this impact;

of operations for the nine months ended September 30, 2022 and for the years ended December 31, 2021 and December 31, 2020, reflect this

however, we expect that this trend may continue, and the full extent of the impact is unknown.

In recent months, some governmental agencies

in the US and Europe, where we produce the largest percentage of our sales, have lifted certain restrictions.

However, if customer demand

continues to be low, our future equipment sales, subscriber activations and sales margin will be impacted.

In recent months, some governmental

agencies in the US and Europe, where we produce the largest percentage of our sales, have lifted certain restrictions.

However, if customer

demand continues to be low, our future equipment sales, subscriber activations and sales margin will be impacted.

Compensatory Arrangements of Director

January 7, 2022, the Board appointed Rodney Barreto as a new director to the Board, effective January 20, 2022.

No decision has been

made with respect to the naming of Mr.

Barreto to any regular committees of the Board.

connection with Mr.

Barreto’s appointment to the Board, the Company executed a Director Services Agreement (the “Director

Agreement”) with Mr.

Barreto on January 11, 2022.

The Director Agreement has a two -year term (subject to the director’s nomination

and election) and provides for a cash retainer of $ 48,000 per year, plus an equity award of 20,000 shares of restricted stock, half of

which will be issued and vest on the day of grant, with the remaining half vesting and being issued on the first anniversary of the grant

The Director Agreement also contains customary confidentiality and indemnification provisions and require the Company to maintain

a specified amount of director and officer insurance.

There are no arrangements or understandings between Mr.

Barreto and any other person

pursuant to which Mr.

Barreto was selected as a director

September 13, 2022, the Board appointed Maria Cristina Fernandez as a new director to the Board.

In addition, the Board approved a rotation

in the membership of the Company’s audit committee, compensation committee and nominating committee.

The membership of each such

committee is now as follows:

Audit Committee:

Rodney Barreto (Committee Chair),

Cristina Fernandez, and Lou Cusimano

Compensation Committee:

Hector Delgado (Committee Chair),

Lou Cusimano, and John Miller

Nominating Committee:

Cristina Fernandez (Committee

Chair), Lou Cusimano and Rodney Barreto

connection with Ms.

Fernandez’s appointment to the Company’s Board of Directors, the Company entered into a Director Services

Agreement with Ms.

Fernandez on September 28, 2022.

The agreement has a two -year term (subject to the director’s nomination and

election) and provides for a cash retainer of $ 30,000 per year plus meeting fees of $ 3,000 for every Board meeting attended and $ 500

for each committee meeting attended (to the extent such committee meetings do not occur on the same day as a board meeting).

The agreement

also contains customary confidentiality and indemnification provisions and require the Company to maintain a specified amount of director

and officer insurance.

The Company also entered into a Stock Option Agreement with Ms.

Fernandez on October 1, 2022, granting Ms.

options to purchase 20,000 shares of the Company’s common stock, subject to the vesting and other conditions set forth in the Stock

Option Agreement.

Under the vesting provisions in the Stock Option Agreement, the first half of the options were fully vested on day

one, with the remaining half vesting on the first anniversary of the grant date.

The options granted under the Stock Option Agreement

were made outside of the Company’s existing equity incentive plans and were approved by the Company’s independent directors.

CORP AND SUBSIDIARIES

6 unchanged sentences

Under the terms of the 2021 Phipps Employment Agreement, Mr.

Phipps serves as the serve

as President of the Company and Chief Executive Officer of Global Operations.

Phipps serves as the President of the Company and Chief Executive Officer of Global Operations.

The term will be automatically extended for additional

265 unchanged sentences

documented, unreimbursed expenses incurred prior to such date, the Employee shall be entitled to the following severance benefits:

a cash payment equal to $75,000, to be paid in a single lump sum payment not later than sixty (60) days following such termination,

less withholding of all applicable taxes;

(ii) continued provision for a period of twelve (12) months after the date of termination of

the benefits under Benefits Plans extended from time to time by the Corporation to its senior Employees;

a cash payment equal to $75,000, to be paid in a single lump sum payment not later than sixty (60) days following such termination, less

withholding of all applicable taxes;

(ii) continued provision for a period of twelve (12) months after the date of termination of the

benefits under Benefits Plans extended from time to time by the Corporation to its senior Employees;

and (iii) payment on a pro-rated

3 unchanged sentences

of Employee’s employment pursuant to Section 5(a)(v) or by the Corporation without “Cause.”

December 2, 2021, the Company entered a 62-month lease for 4,141 square feet of office space for $ 186,345 annually.

July 12, 2022, the Company entered into a mutual release and separation agreement with Mr.

Cohen in regard to his employment with the

Company and accepted his resignation as of July 29, 2022.

Per the terms of the agreement Mr.

Cohen was entitled to $75,000 severance

and the remaining 15,000 restricted stock award became fully vested and was issued on August 4, 2022, resulting in stock-based compensation

of $ 76,950 .

December 2, 2021, the Company entered a 62-month lease for its corporate headquarters for 4,141

square feet of office space for $ 186,345

annually, in Coconut Grove, FL.

The rent increases 3 %

3 % annually.

The lease commenced on June 13, 2022 and will expire on August 31, 2027.

July 24, 2019, a three-year lease was signed for 2,660

square feet for £ 25,536

annually, for our facilities in Poole, England, “UK lease”, for £ 2,128

per month, or USD $ 2,765

per month at the yearly average conversion rate of 1.299279 .

The Poole lease expired July 23, 2022 and the Company is continuing to lease the facility on a month-to-month basis, as we may seek

to expand to a larger facility.

July 24, 2019, a three-year lease was signed for 2,660 square feet for £ 25,536 annually, for our facilities in Poole, England,

“UK lease”, for £ 2,128 per month, or USD $ 2,765 per month at the yearly average conversion rate of 1.299279 .

lease expired July 23, 2022 and the Company is continuing to lease the facility on a month-to-month basis.

On October 6, 2022, the UK

lease was renewed effective November 1, 2022 to October 31, 2023 for £ 2,500 , or USD $ 3,146 per month at the yearly average conversion

rate of 1.25838 .

This renewal is not representative in the table future minimum lease payments, for the nine months ended September 30,

leases do not require any contingent rental payments, impose any financial restrictions, or contain any residual value guarantees.

2 unchanged sentences

classified as financing leases.

Future minimum lease payments under these leases are

OF FUTURE MINIMUM LEASE PAYMENTS

minimum lease payments under these leases are as follows:

SCHEDULE OF FUTURE MINIMUM LEASE PAYMENTS

Years Ending December 31,

3 unchanged sentences

Weighted average remaining term

expenses for the six months ended June 30, 2022, and 2021 were $ 17,479 and $ 15,476 , respectively.

expenses for the nine months ended September 30, 2022, and 2021 were $ 58,284 and $ 24,948 , respectively.

CORP AND SUBSIDIARIES

1 unchanged sentence

13 - COMMITMENTS AND CONTINGENCIES (continued)

June 30, 2022, the Company had current and long-term operating lease liabilities of $ 899,987 and right of use assets of $ 909,908 .

rent expense for the six months ended June 30, 2022 and 2021 were $ 17,815 and $ 18,933 , respectively.

September 30, 2022, the Company had current and long-term operating lease liabilities of $ 863,294 and right of use assets of $ 865,115 .

rent expense for the nine months ended September 30, 2022 and 2021 were $ 70,717 and $ 36,055 , respectively.

June 22, 2021, Thomas Seifert’s employment as the Company’s Chief Financial Officer was terminated for cause.

24 unchanged sentences

found that the evidence did not support Seifert’s claims.

On September 8, 2022, we received notice from the U.S.

Department of

Labor that Thomas Seifert had withdrawn his Complaint.

Pursuant to applicable Federal Regulations, the matter was closed and the Secretary’s

Findings were rescinded.

time to time, the Company may become involved in litigation relating to claims arising out of our operations in the normal course of

3 unchanged sentences

14 - CONCENTRATIONS

accounted for 49.5 % and 64.6 % of the Company’s revenues during the six months ended June 30, 2022 and 2021, respectively.

customer accounted for 10 % or more of the Company’s revenues for either period.

accounted for 52.3 %

of the Company’s revenues during the nine months ended September 30, 2022 and 2021, respectively.

For the three months ended

September 30, 2022 and 2021, Amazon accounted for 59.2 %

64.8 %, respectively.

No other customer accounted for 10 %

or more of the Company’s revenues for either period.

CORP AND SUBSIDIARIES

1 unchanged sentence

14 – CONCENTRATIONS (continued)

following table sets forth information as to each supplier that accounted for 10% or more of the Company’s purchases for the six

months ended June 30, 2022 and 2021.

following table sets forth information as to each supplier that accounted for 10% or more of the Company’s purchases for the nine

months ended September 30, 2022 and 2021.

SCHEDULE OF CONCENTRATION RISK

June 30, 2022

June 30, 2021

September 30, 2022

September 30, 2021

Satcom Global

Globalstar Europe

1 unchanged sentence

Cygnus Telecom

Satcom Global

following table sets forth information as to each supplier that accounted for 10% or more of the Company’s purchases for the three

months ended June 30, 2022 and 2021.

June 30, 2022

June 30, 2021

months ended September 30, 2022 and 2021.

September 30, 2022

September 30, 2021

Satcom Global

Globalstar Europe

1 unchanged sentence

Cygnus Telecom

Satcom Global

following table sets forth revenue as to each geographic location, for the six months ended June 30, 2022 and 2021:

following table sets forth revenue as to each geographic location, for the nine months ended September 30, 2022 and 2021:

SCHEDULE OF REVENUE FROM EACH GEOGRAPHIC LOCATION

June 30, 2022

June 30, 2021

September 30, 2022

September 30, 2021

North America

1 unchanged sentence

Asia & Pacific

following table sets forth revenue as to each geographic location, for the three months ended June 30, 2022 and 2021:

June 30, 2022

June 30, 2021

following table sets forth revenue as to each geographic location, for the three months ended September 30, 2022 and 2021:

September 30, 2022

September 30, 2021

North America

2 unchanged sentences

15 - SUBSEQUENT EVENTS

On July 12, 2022, the Company hired Lauren Sturges

Fernandez, the spouse of Mr.

Fernandez, as Manager of Digital Assets.

Fernandez is an at-will employee with an annual salary

of $ 95,000 .

July 22, 2022, the Company issued 200,000 shares of restricted common stock to Charles M.

Fernandez, pursuant to a restricted stock

award, which vested on May 28, 2022, see Note 9.

Option Agreement

July 1, 2022, the Company granted Charles Fernandez, 70,000 fully vested options, pursuant to compensation committee board approval on

June 30, 2022.

The options are issued under the Company’s 2021 Incentive Award Plan, the “2021 Plan”.

The options have

an exercise price of $ 2.13 and a term of 10 years.

July 29, 2022, Andrew Cohen resigned his position as Senior Vice President of Operations.

Pursuant to the amendment to the Cohen

Agreement on May 2, 2022, Mr.

Cohen received $ 75,000

severance, less applicable taxes and the remaining unvested portion of the restricted stock award granted on October 8, 2021.

relation to the above, on August 4, 2022, the Company issued 15,000

shares of restricted common stock for stock-based compensation of $ 71,250 ,

based on the fair market value of the market close of award date, October 8, 2021 of $ 4.75 .

These equity awards to Mr.

Cohen were issued outside of a shareholder approved stock or option plan pursuant to the Nasdaq

“inducement grant” exception (Nasdaq Listing Rule 5635(c)(4)).

October 1, 2022, the Company entered into a Stock Option Agreement with Ms.

Maria Cristina Fernandez granting Ms.

Fernandez options to

purchase 20,000 shares of the Company’s common stock, subject to the vesting and other conditions set forth in the Stock Option

Under the vesting provisions in the Stock Option Agreement, the first half of the options were fully vested on day one, with

the remaining half vesting on the first anniversary of the grant date.

The options granted under the Stock Option Agreement were made

outside of the Company’s existing equity incentive plans and were approved by the Company’s independent directors.

October 6, 2022, the UK lease was renewed for our facility in Poole, United Kingdom, effective November 1, 2022 to October 31, 2023,

for £ 2,500 , or USD $ 3,146 per month at the yearly average conversion rate of 1.25838.

November 7, 2022, in connection with election of Mr.

Robert Bedwell as the Chief Compliance Officer of the Company, the Company entered

into an employment agreement with Mr.

Pursuant to this agreement, Mr.

Bedwell will receive an annual base salary of $ 125,000

and will be eligible for grants of awards under the Company’s Incentive Award Plan as determined by the Compensation Committee

and our CEO from time to time with an initial reward under his employment agreement of stock options for 50,000 shares of the Company’s

common stock with a vesting schedule as follows:

(1) options for 25,000 shares will become fully vested on the first anniversary of the

commencement of Mr.

Bedwell’s employment with the Company;

(2) options for 10,000 additional shares will become fully vested on

the second anniversary of the commencement of Mr.

Bedwell’s employment with the Company;

and (3) options for an additional 15,000

shares will become fully vested on the third anniversary of the commencement of Mr.

Bedwell’s employment with the Company.

Bedwell duties for NextPlat, he will continue monitoring the compliance of RXMD and PharmCoRx, accordingly Progressive Care will

pay for 20% of Mr.

Bedwell’s annual base salary.

November 14, 2022, in connection with the transition of Mr.

Paul Thomson from Executive Vice President and Chief Financial Officer of

the Company to his new role as Senior Vice President of Mergers, Acquisitions and Special Projects, the Company entered into a new employment

agreement with Mr.

This new agreement has an initial term of one year and may be extended by our CEO for additional terms of

one year each.

Under this agreement, Mr.

Thomson will be paid an annual base salary of $ 150,000 and will keep all his rights and interests

in and to the options set forth in his prior employment agreement with the Company, subject to the terms and conditions set forth in

such prior employment agreement.

November 14, 2022, in connection with the election of Ms.

Cecile Munnik as Chief Financial Officer of the Company, the Company entered

into an employment agreement with Ms.

Pursuant to the agreement, until June 30, 2023, Ms.

Munnik will devote 30% of her business

time to the Company and will devote the remaining 70% to Progressive Care.

Starting on July 1, 2023, Ms.

Munnik will devote all of her

full business time and effort to the performance of her duties as the Chief Financial Officer of the Company.

Munnik will receive

an annual base salary of $ 67,500 from the commencement of her employment with the Company until June 30, 2023.

Thereafter, commencing

on July 1, 2023, Ms.

Munnik will receive an annual base salary of $ 225,000 .

In addition, Ms.

Munnik will be eligible for grants of awards

under the Company’s Incentive Award Plan as determined by the Compensation Committee and our CEO from time to time with an initial

reward under her employment agreement of stock options for 50,000 shares of the Company’s common stock with a vesting schedule

(1) options for 25,000 shares will become fully vested on the first anniversary of the commencement of Ms.

employment with the Company;

(2) options for 10,000 additional shares will become fully vested on the second anniversary of the commencement

Munnik’s employment with the Company;

and (3) options for an additional 15,000 shares will become fully vested on the third

anniversary of the commencement of Ms.

Munnik’s employment with the Company.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

25 unchanged sentences

encourage you to review our periodic reports filed with the SEC and included in the SEC’s EDGAR database, including the Annual

Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on June 30, 2022, and the Company’s subsequent public

filings with the SEC.

Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on September 30, 2022, and the Company’s subsequent

public filings with the SEC.

Corp, formerly Orbsat Corp (“NextPlat”), is a Nevada corporation.

39 unchanged sentences

We have incurred strong increases in sales outside

of our Amazon marketplaces for the six months ended June 30, 2022.

However due to uncertainties related to variants of COVID-19, we are

uncertain as to the continuation of the increases to revenue.

of our Amazon marketplaces for the nine months ended September 30, 2022.

However due to uncertainties related to variants of COVID-19,

we are uncertain as to the continuation of the increases to revenue.

beyond our current global network of online storefronts serving thousands of consumers, enterprises, and governments, the Company has

7 unchanged sentences

assets once applicable legal and regulatory requirements are addressed.

As currently contemplated, NextPlat Digital will facilitate the

As currently contemplated, NextPlat Digital may facilitate the

creation/minting, purchase and sale of a broad range of non-yield-generating and non-fractionalized NFT products, including, but not

6 unchanged sentences

particular brand or product).

We anticipate that NextPlat Digital will be substantially complete within the next six to nine months.

We do not currently intend to undertake or participate in “initial coin offerings”, the minting

of “coins” or the mining of cryptocurrencies.

legal status of NFTs under a myriad of state and federal laws and regulatory regimes (including securities, banking, and commodities

31 unchanged sentences

evolve to take into account developments in case law, applicable facts, developments in technology, and changes in applicable regulatory

do not currently intend to undertake or participate in “initial coin offerings”, the minting of “coins” or the

mining of cryptocurrencies.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

of a particular NFT’s status as a security, we will need to assess whether we needed to comply with other applicable regulations

and laws (including but not limited to AML and CFT regulations).

If we are deemed to be involved in the exchange or transmission of value

that substitutes for currency, or fall under other evolving requirements, we may be deemed to be a “money transmitter” and

will be subject to AML and CFT regulations.

Depending on the particular attributes of an NFT, the manner in which it is marketed, and

the nature of the clientele, we could be subject to other legal and regulatory regimes as well.

We will endeavor to comply with all applicable

laws in connection with our NextPlat Digital business, but the uncertain application of those laws to our proposed business may create

substantial risk to the Company.

onboarding new users, we intend to utilize third-party tools to proactively screen for high-risk crypto wallets, including explicitly

sanctioned addresses and addresses associated with sanctioned entities.

Crypto wallets protect the identity of the owner of the wallet,

store the owner’s private keys, secure and provide access by the owner to the cryptocurrency owned by it and allow the owner to

send, receive, and transact business with cryptocurrencies.

Such wallets by their nature obfuscate the identity of the owner of the wallet

and limit access to the transaction history of that wallet and its owner.

Consequently, crypto wallets and cryptocurrencies may be used

by persons seeking to avoid legal oversight and to violate the law.

For example, they can be used to launder money and to promote terrorism.

The applicable legal requirements and our compliance obligations will vary depending on the nature of the client, the service or product

provided and jurisdiction.

For example, if we engage, form or acquire a broker dealer in order to post, trade or sell NFTs or other digital

assets that are securities, we will attempt to fully comply with all applicable KYC, AML and CFT compliance requirements.

other hand, we facilitate the distribution of free promotional corporate collectable NFTs that are not deemed to be securities, our compliance

requirements will be significantly less.

In either event there can be no assurance that our efforts to fully comply with applicable law

will be successful.

determining to engage in transactions in an NFT, we will attempt to comply with all applicable laws.

However, given the substantial legal

uncertainties that may presented by those laws and given the informational constraints presented by crypto wallets we may not be successful

in our efforts.

As a consequence, we may be exposed to regulatory enforcement and civil or criminal sanction should a legal authority

determine that our approach is inadequate or inappropriate, as well as to claims asserting civil liability.

Moreover, governmental agencies

may seek to apply laws to our NextPlat Digital business that we believe are inapplicable and may seek sanctions relating to our alleged

failure to comply with those laws.

2022 Private Placement of Common Stock

December 31, 2021, after markets closed, a securities purchase agreement (the “Purchase Agreement”) was circulated to, and

signatures were received from, certain institutional and accredited investors (the “December Investors”) in connection with

the sale in a private placement by the Company of 2,229,950 shares of the Company’s common stock (the “December Offering”).

On January 2, 2022, the Company delivered to December Investors a fully executed Purchase Agreement, which was dated December 31, 2021.

The purchase price for the common stock sold in the December Offering was $3.24 per share, the closing transaction price reported by

Nasdaq on December 31, 2021.

closing of the December Offering occurred on January 5, 2022.

The Company received gross proceeds from the sale of the common stock in

the December Offering of approximately $7.2 million.

The Company intends to use the proceeds from

the December Offering for general corporate purposes, including potential acquisitions and joint ventures.

Approximately 73% of

funds raised in the December Offering were secured from existing shareholders and from the members of the Company’s senior management

and Board of Directors.

connection with the December Offering, the Company entered into a registration rights agreement with the December Investors (the “Registration

Rights Agreement”), pursuant to which, among other things, the Company agreed to prepare and file with the SEC a registration statement

to register for resale the shares of the Company’s common stock sold in the Offering.

shares of common stock offered and sold in the December Offering were sold in reliance on the exemption from registration provided by

Section 4(a)(2) of the Securities Act and Rule 506 of Regulation D promulgated under the Securities Act and corresponding provisions

of state securities or “blue sky” laws.

terms of the transaction disclosed above, including the provisions of the Purchase Agreement and Registration Rights Agreement, were

approved by the Board of Directors and because some of the securities were offered and sold to officers and directors of the Company,

such terms were separately reviewed and approved by the Audit Committee of the Board of Directors.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements