What changed in this filing

/stocks — the workspaceLOADING

Item 5. Other Information

2024-08-13 compared with 2024-05-16 · 70 added, 81 removed, 16 unchanged (90% of the section changed)

Other Information

February 4, 2024, the Company and Worksport New York Operations Corporation (“Worksport New York”) entered into a Forbearance

Agreement with Northeast Bank (the “Lender”) in connection with that certain secured loan agreement, dated May 4, 2022 (the

“Loan Agreement”), by and among the Company, as the guarantor (the “Guarantor”), Worksport New York, as the borrower

(the “Borrower”), and the Lender in connection with the Company’s purchase of its 152,847 square foot facility and

18 acres of land in West Seneca, New York on May 6, 2022 for a total purchase price of $8,150,000.

Pursuant to the Forbearance Agreement,

the Lender agreed to forbear from commencing an action for judgement of foreclosure and sale, seeking an appointment of a receiver or

collecting default accrued interest under the Loan until the occurrence of a Termination Event (as defined in the Forbearance Agreement)

and the Company and Worksport waived all defenses in connection with the Worksport New York failure to maintain 1.20 to 1.0 debt service

coverage ratio of net operating income to debt service under the Loan for each of the trailing twelve (12) months ended December 31,

2023, and the indirect sale of equity securities of Worksport New York as a result of the Company’s sale equity securities in November

2023 (the “Existing Defaults”).

Pursuant to the Forbearance Agreement, the definition of “Permitted Transfers”

in the Loan Agreement was amended to include the transfer of direct or indirect interest in the Company solely through a stock sale for

capital raising purposes, subject to certain conditions, including no occurrence of an Events of Default (other than the Existing Defaults),

change in ownership or control of the Company, no new 10% or greater owners, and no involvement of Sanctioned Persons.

The Borrower must

provide prior notice to Lender and satisfactory reporting of the results of the capital raise.

The Forbearance Agreement has been filed

as an exhibit to this report and is incorporated by reference herein.

April 29, 2024, 13,300 stock options issued during the three months ended March 31, 2024 were

forfeited with the termination of the employee.

● 16,667 RSU units were granted onto

a Contractor on May 1, 2024 in consideration for services rendered in Q1 2024.

May 2, 2024, the Company announced a collaboration with viral marketing firm Chief of Chaos to use

the latter’s strategic insight to cultivate the story behind the Company’s current

and upcoming products, aiming to replicate this success by enhancing the Company’s

market presence and driving significant sales through innovative, targeted marketing campaigns.

● On May 6, 2024, 1,477,892 pre-funded warrants issued during the three months ended March 31, 2024 were exercised

for 1,477,892 shares of common stock for $148.

May 8, 2024, the Company announced its receipt of a major grant from New York State Excelsior Jobs Program worth up to $2.8 million.

The grant, following a strategic low-cost power award from New York Power Authority (NYPA) in April 2024, signifies additional

state-level investment in the Company’s expanding operations.

With growth exceeding NY State’s forecasts, the

Company expects to create up to or over 280 new jobs from 2025 to 2030 and if achieved will receive cash benefits for the

creation of these jobs, amounting to $2.8 million received over the next 10 years.

● On May 14, 2024, the Company successfully negotiated an extension of the maturity date for its $5.3 million Loan

Agreement originally due on May 20th, 2024.

The Company entered into an agreement with the lender to extend the maturity date to August

May 14, 2024, the Company and Worksport New York Operations Corporation (“Worksport

New York”) entered into an Omnibus Amendment of Loan Documents (the “Loan Amendment”)

with Northeast Bank (the “Lender”) in connection with that certain secured loan

agreement, dated May 4, 2022 (the “Loan Agreement”), by and among the Company,

as the guarantor (the “Guarantor”), Worksport New York, as the borrower (the

“Borrower”), and the Lender in connection with the Company’s purchase of

its 152,847 square foot facility and 18 acres of land in West Seneca, New York on May 6,

2022 for a total purchase price of $8,150,000.

Pursuant to the Loan Amendment, effective

as of May 10, 2024, the Lender extended the initial maturity date of the Loan from May 10,

2024 to August 10, 2024 (the “Extended Maturity Date”).

The Company also agreed

to pay the Lender an extension fee of $106,000 (the “Extension Fee”) which was

deemed fully earned as of the date of the Loan Amendment.

However, the Lender agreed to postpone

payment of the Extension Fee until the occurrence of (i) the Loan not being repaid in full

by or on the Extended Maturity Date;

or (ii) Loan being accelerated following an Event of

Default or Termination Date (as defined in the Forbearance Agreement).

If the Loan is repaid

in full on or prior to the Extended Maturity Date, the Lender has agreed to waive the Extension

In addition to the Extension Fee, the Company agreed to pay the Lender an exit fee of

$106,000 (the “Exit Fee”) in the event the Loan is not repaid in full on or prior

to the Extended Maturity Date or if the Loan has been accelerated following an Event of Default

May 14, 2024 , the Company and Worksport New York Operations Corporation entered into an Omnibus Amendment of Loan Documents with

Northeast Bank in connection with that certain secured loan agreement, dated May 4, 2022, by and among the Company, as the guarantor,

Worksport New York, as the borrower, and the Lender in connection with the Company’s purchase of its 152,847 square foot facility

and 18 acres of land in West Seneca, New York on May 6, 2022 for a total purchase price of $8,150,000.

Pursuant to the Loan Amendment,

effective as of May 10, 2024, the Lender extended the initial maturity date of the Loan from May 10, 2024 to August 10, 2024.

also agreed to pay the Lender an extension fee of $106,000 which was deemed fully earned as of the date of the Loan Amendment.

the Lender agreed to postpone payment of the Extension Fee until the occurrence of (i) the Loan not being repaid in full by or on the

Extended Maturity Date;

or (ii) Loan being accelerated following an Event of Default or Termination Date (as defined in the Forbearance

If the Loan is repaid in full on or prior to the Extended Maturity Date, the Lender has agreed to waive the Extension Fee.

In addition to the Extension Fee, the Company agreed to pay the Lender an exit fee of $106,000 (the “Exit Fee”) in the event

the Loan is not repaid in full on or prior to the Extended Maturity Date or if the Loan has been accelerated following an Event of Default

or in connection with a Termination Event (as defined in the Forbearance Agreement).

Loan is repaid in full on or prior to the Extended Maturity Date (and not as a result of

an acceleration following a Termination Event), the Company will not be required to pay the

The Loan Amendment has been filed as an exhibit to this report and is incorporated

by reference herein.

If the Loan is repaid in full on or prior to the

Extended Maturity Date (and not as a result of an acceleration following a Termination Event), the Company will not be required to pay

the Exit Fee.

July 11, 2024, the Company announced the launch of a dealer webpage to facilitate the purchasing process for dealers seeking Worksport

truck accessories.

July 18, 2024, the Company announced that it will be hosting a live FY24 Q2 earnings call, as scheduled for August 13, 2024, at 4:30pm

July 19, 2024, the Company refinanced its $5.3 million loan by entering into a Revolving Financing and Assignment Agreement with a

facility of $6 million.

Upon transaction close, the Company drew down approximately $5.06 million of the Revolving Credit Facility,

net of $790,000 of interest reserve required to be withheld to ensure interest payments by the Company.

The Company used $4.73

million of the drawn down amount to refinance the Company’s mortgage on the Company’s real property located at 2500

North America Dr.

in West Seneca, New York, and additionally drew approximately $330,000, leaving

approximately $940,000 available for Accounts Receivable financing under the Agreement as of the deal close date.

July 23, 2024, the Company engaged in stock option repricing for certain employees, executive officers, and members of the board

of directors of the Company.

All included options’ exercise prices were repriced to $0.7042 – the closing price per share

of the Company’s common stock as reported on The Nasdaq Stock Market on July 23, 2024.

The Repriced Options consisted of certain

outstanding stock options that had been granted under the Company’s 2015 Equity Incentive Plan, the 2021 Equity Incentive Plan

and 2022 Stock Incentive Plan as of July 23, 2024.

July 23, 2024, the Company entered into an agreement (the “Agreement”) with the Chief Executive

Officer and President of the Company and 2230164 Ontario Inc.

owned by the Chief Executive Officer and President of the Company (the

The term of the Agreement commenced on July 23, 2024 and continues unless terminated pursuant

to the terms of the Agreement.

The CEO will receive an annual base payment of $300,000 (“Base Fees”)

for services provided pursuant to the Agreement and shall be afforded the opportunity to earn an annual incentive bonus

equal to 50% of the Base Fees, provided that certain performance goals are met.

The performance goals will be established on an annual

basis by the Compensation Committee of the Board of Directors of the Company, when constituted.

On the effective date of the Agreement, the Company granted 3,500,000 shares of the Company’s common stock at fair market value on the date of issuance.

The option will vest in equal quarterly installments over a period of five (5) years and expire on the tenth anniversary of the date

of grant, subject to the CEO’s continuous service with the Company.

In the event of a change of control of the Company,

the option shall immediately vest in full.

July 30, 2024, the Company announced the launch of a new live sales feature on its website in partnership with Firework – a

platform trusted by over 1,000 global brands.

This new live sales feature allows potential customers to speak directly with a Worksport

representative at point of sale, which provides an interactive, yet digital shopping experience for consumers.

Firework has shown

large success in using this strategy to increase average order values and sales conversions.

Forbearance Agreement, dated February 14, 2024, by and among Worksport New York Operations Corporation, Worksport Ltd., and Northeast Bank.

Omnibus Amendment of Loan Documents, dated May 14, 2024 and effective as of May 10, 2024, by and among Northeast Bank, Worksport New York Operations Corporation, and Worksport Ltd.

Section 302 Certification of Chief Executive Officer

of Inducement Letter (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K of Worksport Ltd.

of Inducement Warrant (incorporated by reference to Exhibit 4.1 of the Current Report on Form 8-K of Worksport Ltd.

Section 302 Certification of Chief Executive Officer and President.

Section 302 Certification of Chief Financial Officer.

Section 906 Certifications of Chief Executive Officer

Section 906 Certifications of Chief Executive Officer and President.

Section 906 Certifications of Chief Financial Officer.

Omnibus Amendment of Loan Documents

Inline XBRL Instance Document

Inline XBRL Taxonomy Extension Schema Document

Inline XBRL Taxonomy Extension Calculation Linkbase

Inline XBRL Taxonomy Extension Label Linkbase Document

Inline XBRL Taxonomy Extension Presentation Linkbase

Inline XBRL Taxonomy Extension Definition Linkbase

Cover Page Interactive Data File (embedded within the

Inline XBRL document)

Filed herewith.

XBRL Instance Document.

XBRL Taxonomy Extension Schema Document.

XBRL Taxonomy Extension Calculation Linkbase Document.

XBRL Taxonomy Extension Label Linkbase Document.

XBRL Taxonomy Extension Presentation Linkbase Document.

XBRL Taxonomy Extension Definition Linkbase Document.

Page Interactive Data File (embedded within the Inline XBRL document filed as Exhibit 101).

32.1 and 32.2 are being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act,

4 unchanged sentences

behalf of the registrant and in the capacities and on the dates indicated.

WORKSPORT LTD.

Executive Officer

August 13, 2024

Executive Officer and President

Executive Officer)

August 13, 2024

Michael Johnston

2 unchanged sentences

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 5. Other Information