PART II AND III

Post-Qualification Offering Circular Amendment No. 1

File No. 024-11454

An Offering Statement pursuant to Regulation A relating to these securities has been filed with the Securities and Exchange Commission (the “SEC”). Information contained in this Preliminary Offering Circular is subject to completion or amendment. These securities may not be sold nor may offers to buy be accepted before the Offering Statement filed with the SEC is qualified. This Preliminary Offering Circular shall not constitute an offer to sell or the solicitation of an offer to buy nor may there be any sales of these securities in any state in which such offer, solicitation or sale would be unlawful before registration or qualification under the laws of any such state. We may elect to satisfy our obligation to deliver a Final Offering Circular by sending you a notice within two business days after the completion of our sale to you that contains the URL where the Final Offering Circular or the Offering Statement in which such Final Offering Circular was filed may be obtained.

REGULATION A OFFERING CIRCULAR UNDER THE SECURITIES ACT OF 1933

OFFERING CIRCULAR AS OF

 MARCH 11, 2022, SUBJECT TO COMPLETION

TROPICAL RACING, INC.

 5,880,000 Units Consisting of

One Class A Common Share and One Common Share Purchase Warrant

5,880,000 Class A Common Shares and 5,880,000 Warrants Contained in the Units

5,880,000 Class A Common Shares Underlying the Warrants

1740 Grassy Springs Road

Versailles, Kentucky 40383

(561) 513-8767

www.tropicalracing.com

Tropical Racing, Inc., a Florida corporation (the “Company”, “we”, or “our”) is offering up to 5,880,000 units (the “Units”) consisting of 5,880,000 shares of our Class A common stock, par value $.0001 per share (the “Class A Common Stock”, each share, a “Class A Share” and, together, the “Class A Shares”) and 5,880,000 Warrants (as defined below) and offering up to 5,880,000 Class A Shares underlying the Warrants (the “Maximum Amount”) of the Company, to be sold in this offering (the “Offering”). Each Unit offered at a purchase price of $3.50 per Unit is comprised of one Class A Share and one Class A Common Share purchase warrant (each whole warrant, a “Warrant” and collectively, the “Warrants”) to purchase one additional Class A Share (a “Warrant Share”). One Warrant is required to purchase one additional Warrant Share at an exercise price of $5.00 per Warrant, subject to certain adjustments. The Warrants are exercisable immediately and terminating on the date that is the eighteen (18) month anniversary of the issuance of the Warrant (the “Closing Date”). See “Securities Being Offered” for a discussion of certain items required by Item 14 of Part II of Form 1-A. The Units are being offered on a “best efforts” basis. All dollar amounts are expressed in United States currency, unless otherwise indicated. 

As of March 4, 2022, the Company has raised $10,551,982 in gross proceeds, prior to commissions, through the issuance of 3,014,852 Units with a holdback of $352,246 and pending transactions of $142,878. The Company may consider increasing its price per Unit at a later date.

This Post-Qualification Offering Circular Amendment No. 1 (this “PQA”) amends the Form 1-A Offering Statement of the Company, originally qualified March 10, 2021.   Under our ongoing Offering, we have received aggregate investment commitments totaling approximately $11.0 million in gross proceeds through March 4, 2022. This includes completed sales of $10,551,982  and investment commitments still in process of $495,124. Such investment commitments are awaiting completion of receipt or processing and there are no guarantees all funding commitments will ultimately be realized as gross proceeds.

We are selling our Units through a Tier 2 offering pursuant to Regulation A (Regulation A+) under the Securities Act of 1933, as amended (the “Securities Act”), and we intend to sell the Units either directly to investors or through registered broker-dealers who are paid commissions. The Company has engaged Dalmore Group, LLC, a New York limited liability company and FINRA/SIPC registered broker-dealer (“Dalmore”), to provide broker-dealer services in connection with this Offering. This Offering will terminate on the earlier of (i) March 10, 2023, (ii) the date on which the Maximum Amount is sold, or (iii) when the Board of Directors of the Company (the “Board”) elects to terminate the offering (in each such case, the “Termination Date”). There is no escrow established for this Offering, although the Company reserves the right to establish an escrow and engage an escrow agent in its discretion. We will hold closings upon the receipt of investors’ subscriptions and acceptance of such subscriptions by the Company. If, on the initial closing date, we have sold less than the Maximum Amount, then we may hold one or more additional closings for additional sales, until the earlier of: (i) the sale of the Maximum Amount or (ii) the Termination Date. There is no aggregate minimum requirement for the Offering to become effective; therefore, we reserve the right, subject to applicable securities laws, to begin applying “dollar one” of the proceeds from the Offering towards our business strategy, including, without limitation, research and development expenses, Offering expenses, working capital and general corporate purposes and other uses, as more specifically set forth in the “Use of Proceeds to Issuer” section of this offering circular (the “Offering Circular”). The minimum investment amount from an investor is $1,050 for the purchase of 300 Units; however, we expressly reserve the right to waive this minimum in the sole discretion of our management at any time. We expect to commence the sale of the Units as of the date on which the offering statement of which this Offering Circular is a part (the “Offering Statement”) is qualified by the United States Securities and Exchange Commission (the “SEC”).

Investing in the Units involves a high degree of risk. These are speculative securities. You should purchase these securities only if you can afford a complete loss of your investment. See “Risk Factors” for a discussion of certain risks that you should consider in connection with an investment in our Units.

THE SEC DOES NOT PASS UPON THE MERITS OF OR GIVE ITS APPROVAL TO ANY UNITS OFFERED OR THE TERMS OF THE OFFERING, NOR DOES IT PASS UPON THE ACCURACY OR COMPLETENESS OF ANY OFFERING CIRCULAR OR OTHER SOLICITATION MATERIALS. THESE UNITS ARE OFFERED PURSUANT TO AN EXEMPTION FROM REGISTRATION WITH THE SEC; HOWEVER, THE SEC HAS NOT MADE AN INDEPENDENT DETERMINATION THAT THE UNITS OFFERED ARE EXEMPT FROM REGISTRATION.

	Price to Public		Underwriting Discount and Commissions			Proceeds to the Company(2)		Proceeds to Other Persons
Units, each consisting of	$	3.50		(1	)	$	3.46	None
One Class A Share		-
One Warrant		-
Class A Shares underlying Warrants	$	5.00		-		$	5.00	None
Total(3)	$	49,980,000		(1	)	$	49,774,200	None

(1)	The minimum investment amount for each subscription is 300 Units or $1,050. The Offering may be made, in management’s discretion, directly to investors by the management of the Company on a “best efforts” basis, except in any jurisdictions where the Company is not permitted to make direct selling efforts to prospective investors. We reserve the right to offer the Units through broker-dealers who are registered with the Financial Industry Regulatory Authority (“FINRA”). The Company has engaged Dalmore to provide broker-dealer services and has agreed to pay a fee equal to one hundred (100) basis points on the aggregate amount raised by the Company from investors from the sale of the Units (excluding proceeds from the exercise of Warrants). This will only start after FINRA Corporate Finance issues a No Objection Letter for the Offering. The Company will pay a one-time set up fee of $5,000 and a consulting fee of $20,000 payable once FINRA issues a No Objection Letter and the Company receives SEC Qualification.
(2)	The amounts shown in the “Proceeds to the Company” column are before deducting organization and Offering costs to be borne by the Company, estimated to be approximately $1,500,000, including legal, accounting, printing, due diligence, marketing, selling and other costs incurred in the Offering of the Units. (See “Use of Proceeds to Issuer” and “Plan of Distribution and Selling Securityholders.”)
(3)	The Units are being offered pursuant to Regulation A of Section 3(b) of the Securities Act for Tier 2 offerings. The Units are only being issued to purchasers who satisfy the requirements set forth in Regulation A. We have the option in our sole discretion to accept less than the minimum investment.

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GENERALLY, NO SALE MAY BE MADE TO YOU IN THIS OFFERING IF THE AGGREGATE PURCHASE PRICE YOU PAY IS MORE THAN TEN PERCENT (10%) OF THE GREATER OF YOUR ANNUAL INCOME OR YOUR NET WORTH. DIFFERENT RULES APPLY TO ACCREDITED INVESTORS AND NON-NATURAL PERSONS. BEFORE MAKING ANY REPRESENTATION THAT YOUR INVESTMENT DOES NOT EXCEED APPLICABLE THRESHOLDS, WE ENCOURAGE YOU TO REVIEW RULE 251(d)(2)(i)(C) OF REGULATION A+. FOR GENERAL INFORMATION ON INVESTING, WE ENCOURAGE YOU TO REFER TO WWW.INVESTOR.GOV.

This Offering Circular contains all of the representations by us concerning this Offering, and no person shall make different or broader statements than those contained herein. Investors are cautioned not to rely upon any information not expressly set forth in this Offering Circular.

Sale of the Units will commence following qualification of this PQA on approximately ____________ , 2022.

The Company is following the “Offering Circular” format of disclosure under Regulation A+.

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TABLE OF CONTENTS

	Page
IMPORTANT INFORMATION ABOUT THIS OFFERING CIRCULAR	6
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS	7
SUMMARY	9
RISK FACTORS	13
DILUTION	20
PLAN OF DISTRIBUTION AND SELLING SECURITYHOLDERS	21
USE OF PROCEEDS TO ISSUER	22
DESCRIPTION OF BUSINESS	23
DESCRIPTION OF PROPERTY	41
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	43
DIRECTORS, EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES	48
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS	51
SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN SECURITYHOLDERS	53
INTEREST OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS	54
SECURITIES BEING OFFERED	55
WHERE YOU CAN FIND MORE INFORMATION	58
Part F/S
INDEX TO FINANCIAL STATEMENTS	F-1
Part III - Exhibits
INDEX TO EXHIBITS	59
SIGNATURES	60

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IMPORTANT INFORMATION ABOUT THIS OFFERING CIRCULAR

We are offering to sell, and seeking offers to buy, our securities only in jurisdictions where such offers and sales are permitted. Please carefully read the information in this offering circular and any accompanying offering circular supplements, which we refer to collectively as the “Offering Circular.” You should rely only on the information contained in this Offering Circular. We have not authorized anyone to provide you with any information other than the information contained in this Offering Circular. The information contained in this Offering Circular is accurate only as of its date or as of the respective dates of any documents or other information incorporated herein by reference, regardless of the time of its delivery or of any sale or delivery of our securities. Neither the delivery of this Offering Circular nor any sale or delivery of our securities shall, under any circumstances, imply that there has been no change in our affairs since the date of this Offering Circular. This Offering Circular will be updated and made available for delivery to the extent required by the federal securities laws.

This Offering Circular is part of the Offering Statement that we filed with the SEC using a continuous offering process. Periodically, we may provide an offering circular supplement that would add, update or change information contained in this Offering Circular. Any statement that we make in this Offering Circular will be modified or superseded by any inconsistent statement made by us in a subsequent offering circular supplement. The Offering Statement we filed with the SEC includes exhibits that provide more detailed descriptions of the matters discussed in this Offering Circular. You should read this Offering Circular and the related exhibits filed with the SEC and any offering circular supplement, together with additional information contained in our annual reports, semi-annual reports and other reports and information statements that we will file periodically with the SEC. The Offering Statement and all supplements and reports that we have filed or will file in the future can be read at the SEC website, www.sec.gov.

Unless otherwise indicated, data contained in this Offering Circular concerning the business of the Company are based on information from various public sources. Although we believe that such data is generally reliable, such information is inherently imprecise, and our estimates and expectations based on this data involve a number of assumptions and limitations. As a result, you are cautioned not to give undue weight to such data, estimates or expectations.

In this Offering Circular, unless the context indicates otherwise, references to the “Company,” “we,” “our,” and “us” refer to the activities of and the assets and liabilities of the business and operations of Tropical Racing, Inc., a Florida corporation.

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Some of the statements under “Summary,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Our Business” and elsewhere in this Offering Circular constitute forward-looking statements. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar matters that are not historical facts. In some cases, you can identify forward-looking statements by terms such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “should,” “will” and “would” or the negatives of these terms or other comparable terminology.

You should not place undue reliance on forward looking statements. The cautionary statements set forth in this Offering Circular, including in “Risk Factors” and elsewhere, identify important factors which you should consider in evaluating our forward-looking statements. These include, among other things, the following factors:

Risks Related to our Business and Industry

· We are an early-stage company with limited operating history and may never be profitable.

· Unpredictable events, such as the COVID-19 outbreak, and associated business disruptions could seriously harm our future revenues and financial condition, delay our operations, increase our costs and expenses, and impact our ability to raise capital.

· We may face litigation in the future.

· We have entered into transactions with related parties in the past and have an outstanding related-party liability with the Company’s President, Troy Levy for accrued unpaid salary.

· The Company and our Principal Executive Officer entered into a Stipulation for Consent Order with the State of Colorado.

· There is substantial doubt about our ability to continue as a going concern.

· There are few businesses that have pursued a strategy or investment objective similar to the Company’s.

· Our inability to retain management and key employees could impair the future success of the Company.

· A significant growth in the number of personnel would place a strain upon the Company’s management and resources.

· There is no assurance that the Company’s insurance coverage will be sufficient to cover all claims to which the Company may become subject.

· There can be no assurances that the value of the racehorse (whether it is a Thoroughbred, Quarter Horse or Standardbred) which is owned by the Company will not decrease in the future which may have an adverse impact on the Company’s activities and financial position.

· The cost of racing is unpredictable and speculative and may negatively impact the Company’s ability to generate revenue.

· If a horse is unsuccessful in racing, becomes sick or injured, its value will be adversely affected which may have a negative impact of the Company’s valuation and revenue.

· Horse racing could be subjected to restrictive regulation or banned entirely which could adversely affect the conduct of the Company’s business.

· The Company may not purchase insurance on its horse which could require Company resources to be spent to cover any losses from the death or injury of a horse.

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· A decrease in average attendance per racing date coupled with increasing costs could jeopardize the continued existence of certain racetracks which could negatively impact the Company’s operations.

· Industry practices and structures have developed which may not be attributable solely to profit-maximizing, economic decision-making which may have an adverse impact on our Company’s activities business.

· Investors may only own a minority interest in underlying assets and as a result may not have sufficient control regarding the training or racing of the horse(s).

· Market shortages may impact the ability of the Company to generate revenue.

· The Company has no current intention of paying dividend payments, as revenues are irregular, seasonal, and unpredictable.

· The Company may not raise enough funds or have enough money to purchase the best blood-line champion horses to generate purses.

· The Company invested in a play to earn company, Game of Silks, and if the business plan is not successfully executed, we may lose our initial investment.

Risks Related to the Units and this Offering

· An investment in our Company is a speculative investment and, therefore, no assurance can be given that you will realize your investment objectives.

· There is no public trading market for shares of our Class A Common Stock.

· Prospective investors must undertake their own due diligence regarding our Company.

· We are dependent upon the proceeds of this Offering to provide funds to develop our business.

· You will experience further dilution if we issue additional equity securities in future fundraising transactions.

· Possible changes in federal tax laws may affect your investment.

· Our management team has full discretion as to the use of proceeds from this Offering.

· There may be state law restrictions on an investor’s ability to sell the Units offered hereby.

· You will not have the ability to actively influence the day-to-day management of our business and affairs.

· Shareholders’ voting rights provide limited ability to control the Company.

· Funds from purchasers accompanying subscriptions for the Units will not accrue interest prior to admission of the subscriber as a shareholder in the Company, if it occurs, in respect of such subscriptions.

· Provisions of our Amended and Restated Articles of Incorporation and Bylaws may delay or prevent a takeover which may not be in the best interests of our shareholders.

Although the forward-looking statements in this Offering Circular are based on our beliefs, assumptions and expectations, taking into account all information currently available to us, we cannot guarantee future transactions, results, performance, achievements or outcomes. No assurance can be made to any investor by anyone that the expectations reflected in our forward-looking statements will be attained, or that deviations from them will not be material and adverse. We undertake no obligation, other than as may be required by law, to re-issue this Offering Circular or otherwise make public statements updating our forward-looking statements.

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SUMMARY

This summary highlights selected information contained elsewhere in this Offering Circular. This summary is not complete and does not contain all the information that you should consider before deciding whether to invest in our Units. You should carefully read the entire Offering Circular, including the risks associated with an investment in the company discussed in the “Risk Factors” section of this Offering Circular, before making an investment decision. Some of the statements in this Offering Circular are forward-looking statements. See the section entitled “Cautionary Statement Regarding Forward-Looking Statements” above.

Company Information

The Company was incorporated on March 31, 2017 in the State of Florida and was authorized to do business in the State of Kentucky on February 19, 2019.

The Company’s principal office is located at 1740 Grassy Springs Road, Versailles, Kentucky 40383. The Company’s telephone number is +1 (561) 513-8767 and website address is https://www.tropicalracing.com/. The information contained therein or accessible thereby shall not be deemed to be incorporated into this Offering Circular.

As of the date of this Offering Circular, the Company has (i) 51,523,404 shares of Class A Common Stock outstanding; (ii) 10,000,000 shares of Class B common stock of the Company (the “Class B Common Stock”, each share, a Class B Share”) outstanding; and (iii) no shares of preferred stock of the Company (“Preferred Stock”) outstanding.

Our independent auditor has expressed substantial doubt about our ability to continue as a going concern given our lack of operating history and limited revenues to date.  Our revenue was $316,949 for the year ended December 31, 2020, as compared to $90,167 for the year ended December 31, 2019, and we incurred net losses of $(1,641,186) for the year ended December 31, 2020, as compared to $(1,635,867) for year ended December 31, 2019.  In addition, our revenue for the six-month period ending June 30, 2021 was $133,416, as compared to $103,480 for the six-month period ending June 30, 2020, and we incurred net losses of $(1,712,772) for the six-month period ending June 30, 2021 was, as compared to $(530,632) for the six-month period ending June 30, 2020.

Our future expenditures and capital requirements will depend on numerous factors, including the success of this Offering, funds received from our recent Regulation Crowdfunding campaign and the progress and ability to win races by our racehorses and syndication efforts.

Recent Developments

On February 9, 2022, the Company paid cash and executed its lease option for the purchase of Circle 8 Ranch for $2,955,125.

The Company invested $1,000,000 in a play to earn company called Game of Silks, Inc. (“Game of Silks”) resulting in an ownership of 46.3%.

Intercorporate Relationships

The Company has one active wholly-owned subsidiary, Circle 8 Ranch Corp. (“Circle 8 Ranch”), a corporation organized under the State of Florida on or about March 9, 2019. Certain subsidiaries of the Company are inactive and have been or will be dissolved.

Description of Business

The Company is a thoroughbred horse racing company, cultivating and promoting growth of the Company’s assets with resources in every face of the thoroughbred racing industry. The Company operates its business primarily through three functions: (i) horse ownership syndication; (ii) horse training, breeding and racing; and (iii) pinhooking.

Horse Ownership Syndication

In a horse ownership syndication, a group of people come together to purchase ownership in a promising horse for racing or breeding purposes. Rather than one person purchasing one horse, the Company offers group partnerships where investors can purchase a percentage of one horse or a group of horses, thereby spreading the financial risks and expenses amongst all the partners.

Horse Racing

The Company has a proven track record of horse training, breeding and expert selections in thoroughbred race horses, as set forth in greater detail in “Description of Business—Our Business.” Our thoroughbreds race primarily in Florida, and we have also participated in races in California, New York, New Jersey and Kentucky.

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Pinhooking

A part of our business model involves pinhooking.  Pinhooking is the business of purchasing young horses at one stage of their lives and then reselling them for a higher price at a different stage of their lives.

Current Inventory

The horses noted below are owned by the Company as of the date of this Offering Circular. More information concerning the stallion, dam, and dam sire for each respective horse is detailed in “Description of Business—Our Business.”

	Name	State – Bred	Birth Year	Type
1	Angry Dragon	Kentucky	2008	Broodmare
2	Red Baroness	Kentucky	2008	Broodmare
3	Celtic Moonlight	Florida	2014	Broodmare
4	Dura Cuire	Kentucky	2017	Broodmare
5	Time for Harlan	Kentucky	2011	Broodmare
6	Longstocking	Pennsylvania	2012	Broodmare
7	Precocious Miss	Florida	2016	Broodmare
8	Schmiss	Kentucky	2014	Broodmare
9	Blue Whale	Kentucky	2015	Broodmare
10	Countless Fun	Kentucky	2017	Broodmare
11	Istan Again	Kentucky	2016	Broodmare
12	Rosy Scenario	Kentucky	2017	Broodmare
13	More Royalty	Florida	2013	Broodmare
14	Dreaming As Always	Kentucky	2011	Broodmare
15	Dream Spinner	Kentucky	2016	Broodmare
16	Tizemotionalgold	Kentucky	2017	Broodmare
17	WINY	Chile	2016	Broodmare
18	Yafa	Florida	2018	Broodmare
19	Regal Serenade	Illinois	2015	Broodmare
20	Shesomajestic	Kentucky	2016	Broodmare
21	Chips and Salsa	Florida	2018	Broodmare
22	2022 Dreaming as always	Kentucky	2022	Weanlings
23	2022 Schmiss	Kentucky	2022	Weanlings
24	2022 Precocious Miss	Kentucky	2022	Weanlings
25	2022 Longstocking	Kentucky	2022	Weanlings
26	2022 Rosy Scenario	Kentucky	2022	Weanlings
27	2022 Regal Serenade	Kentucky	2022	Weanlings
28	2022 five star factor	Kentucky	2022	Weanlings
29	2022 do the dance	Kentucky	2022	Weanlings
30	2022 hot n hectic	Kentucky	2022	Weanlings
31	2022 out of danger	Kentucky	2022	Weanlings
32	2022 pledge mom	Kentucky	2022	Weanlings
33	2022 Sara Sara	Kentucky	2022	Weanlings
34	2022 Agent Romanoff	Kentucky	2022	Weanlings
35	2022 Up for grabs	Kentucky	2022	Weanlings
36	2021 Saudia	Kentucky	2021	Yearlings
37	2021 Castellani	Kentucky	2021	Yearlings
38	2021 Quite A nightmare	California	2021	Yearlings
39	2021 Precocious Miss	Kentucky	2021	Yearlings
40	2021 Rosy Scenario	Kentucky	2021	Yearlings
41	2021 Dreaming as Always	Kentucky	2021	Yearlings
42	2021 Schmiss	Kentucky	2021	Yearlings
43	2021 Blue Whale	Kentucky	2021	Yearlings
44	My name is Dragon	Kentucky	2021	Yearlings
45	2021 Red Baroness	Kentucky	2021	Yearlings
46	2021 Istan Again	Kentucky	2021	Yearlings
47	Brooklyns Finest	Kentucky	2020	Two Year Old
48	Xtrasaucewelldone	Kentucky	2020	Two Year Old
49	Dragons Back	Kentucky	2020	Two Year Old
50	Razzaliuna	Kentucky	2020	Two Year Old
51	Raceday Filly 2020	Kentucky	2020	Two Year Old
52	California Gigi	Kentucky	2019	Three Year Old
53	Imoto	Florida	2019	Three Year Old
54	Madelyns Heat	Kentucky	2019	Three Year Old
55	Mount Rundle	Kentucky	2019	Three Year Old
56	Roughly A Diamond	Kentucky	2019	Three Year Old
57	Suegaar	Florida	2019	Three Year Old
58	Volaize	Kentucky	2019	Three Year Old
59	Always Above	Kentucky	2018	Four Year Old
60	Bonheur	Kentucky	2018	Four Year Old
61	My man flint	Kentucky	2018	Four Year Old
62	Toretto	Kentucky	2018	Four Year Old
63	Aizu	Florida	2017	Five Year Old
64	Saving Sophie	Kentucky	2018	Six Year Old

Description of Property

The Company operates its thoroughbred horse racing business out of the State of Florida leasing an executive box at Gulfstream Park racetrack located at 901 South Federal Highway in Hallandale Beach, Florida and the State of Kentucky at the Circle 8 ranch located at 1740 Grassy Springs Rd, Versailles, KY 40383. See “Description of Property.”

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Competition

Horse racing competes against all other forms of entertainment such as professional football, baseball, hockey, soccer, basketball, other gaming, and outdoor activities. According to an IBISWorld Industry Report (Horse Racing Tracks), these indirect competitors may pull much of the available time and money from this sport. Additionally, the horse racing industry is subject to competition from other gambling activities, including electronic gaming, sports betting and arbitrage betting.

Nonetheless, the thoroughbred horse racing industry maintains a base of loyal customers. Such customers not only recognize the financial potential of racehorse investing but also the lifestyle investment involved in the fast-paced and exciting world of thoroughbred horse racing.

Risks Related to Our Business and Industry

Our business and our ability to execute our business strategy are subject to a number of risks as more fully described in the section titled “Risk Factors.” These risks include, among others:

· Our limited operating history and history of losses;

· Unpredictable events, such as the COVID-19 outbreak, and associated business disruptions;

· Our ability to continue as a going concern; 

· Our ability to raise sufficient capital and the availability of future financing;

· Our ability to raise enough funds to purchase the best blood-line champion horses to generate purses;

· Our horses decreasing in value if such horses are unsuccessful in racing, become sick or injured; and 

· Our industry could be subjected to restrictive regulation or banned entirely.

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REGULATION A+

We are offering the Units pursuant to rules of the SEC mandated under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). These offering rules are often referred to as “Regulation A+.” We are relying upon “Tier 2” of Regulation A+, which allows us to offer of up to $50 million in a 12-month period.

In accordance with the requirements of Tier 2 of Regulation A+, we are required to publicly file annual, semi-annual, and current event reports with the SEC.

THE OFFERING

Issuer:	Tropical Racing, Inc., a Florida corporation.
Units Offered:	A maximum of 5,880,000 units (the “Units”), each Unit being comprised of one Class A Share (each, a “Class A Share”) and one Class A common share purchase warrant (each, a “Warrant”), with each Warrant entitling the holder thereof to purchase one additional Class A Share (each, a “Warrant Share”) at a price of $3.50 per Unit. One whole Warrant is required to purchase one additional Class A Share at an exercise price of $5.00 per Warrant, subject to certain adjustments. The minimum investment amount for each subscription is 300 Units or $1,050, which minimum may be waived in our discretion.
Warrant Shares Offered:	A maximum of 5,880,000 Warrant Shares at an exercise price of $5.00 per Warrant Share, subject to customary adjustments. The Warrants are exercisable immediately and terminating on the date that is the eighteen (18) month anniversary of the issuance of the Warrant.
Number of Class A Shares Outstanding before the Offering(1):	48,195,443 Class A Shares.
Number of Class A Shares to be Outstanding after the Offering(1):	59,955,443 Class A Shares if all our Units are sold and all our Warrants are exercised in full and the maximum Warrant Shares are sold and issued.
Price per Unit:	$3.50
Price per Warrant Share:	$5.00
Maximum Amount:	5,880,000 Units, at an offering price of $3.50 per Unit, for total gross proceeds of $49,980,0000 (including the exercise of the Warrants in full to purchase 5,880,000 Warrant Shares with at exercise price of $5.00 per Warrant Share).
Use of Proceeds:	If we sell all of the 5,880,000 Units being offered, our net proceeds (after estimated Offering expenses of $1,075,800) will be approximately $48,904,200. To date, we have used a portion of these net proceeds to purchase the Circle 8 ranch and invest in Game of Silks.  We will use the proceeds from the remaining unsold Units to purchase our neighboring farm or other ranches, make capital improvements to the Circle 8 ranch, acquire racehorses, pay stud fees, invest in stallion shares, purchase ranch equipment, upgrade our barn operations, increase our branding and marketing efforts, make office systems upgrades, pay increased operational horse and ranch expenses, and such other purposes described in “Use of Proceeds to Issuer” section of this Offering Circular.
Risk Factors:	Investing in the Units involves a high degree of risk. See “Risk Factors.”

⁽¹⁾ In addition, there are 5,500,000 Class A Shares reserved for issuance under our 2020 Equity Incentive Plan of which no Class A Shares are currently issuable. There are no outstanding grants under the Plan.

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RISK FACTORS

An investment in the Units involves a high degree of risk. You should carefully consider the risks described below, together with all of the other information included in this Offering Circular, before making an investment decision. If any of the following risks actually occurs, our business, financial condition or results of operations could suffer. In that case, the price of our Class A Shares could decline, and you may lose all or part of your investment. See “Cautionary Statement Regarding Forward Looking Statements” above for a discussion of forward-looking statements and the significance of such statements in the context of this Offering Circular.

Risks Related to our Business and Industry

We are an early-stage company with limited operating history and may never become profitable.

The Company has incurred net losses from the inception of its business until the date of this Offering Circular. The Company’s net loss was $(1,641,186) for the year ended December 31, 2020, as compared to $(1,635,867) for year ended December 31, 2019. The Company cannot assure that it can become profitable or avoid net losses in the future or that there will not be any earnings or revenue declines for any future quarterly or other periods. The Company expects that its operating expenses will increase as it grows its business, including expending substantial resources for research and development and marketing. As a result, any decrease or delay in generating revenues could result in material operating losses.

Unpredictable events, such as the COVID-19 outbreak, and associated business disruptions could seriously harm our future revenues and financial condition, delay our operations, increase our costs and expenses, and impact our ability to raise capital.

Our operations could be subject to unpredictable events, such as earthquakes, power shortages, telecommunications failures, water shortages, floods, hurricanes, typhoons, fires, extreme weather conditions, medical epidemics such as the COVID-19 outbreak, and other natural or manmade disasters or business interruptions, for which we are predominantly self-insured. We do not carry insurance for all categories of risk that our business may encounter. The occurrence of any of these business disruptions could seriously harm our operations and financial condition, and increase our costs and expenses.

COVID-19 has caused significant disruptions to the global financial markets, which could impact our ability to raise additional capital. The ultimate impact on us and our significant suppliers and manufacturers is unknown, but our operations and financial condition could suffer in the event of any of these types of unpredictable events. Further, any significant uninsured liability may require us to pay substantial amounts, which would adversely affect our business, results of operations, financial condition and cash flows.

The Company plan to adhere to all Center of Disease Control guidelines and will test, operate in a socially distant manner and limit large gatherings. Most of the operations and activities of the Company are outdoors and therefore pose lesser risk of contracting the virus.

We may face litigation in the future.

We may be involved in litigation in the future. The adverse resolution of such litigation to us could impair our ability to continue in business if judgment holders were to seek to liquidate our business through levy and execution. We may incur substantial legal fees and costs in connection with future litigation, if any. If we fail in our defense to future actions, if any, or become subject to a levy and execution on our assets and business, we could be forced to liquidate or to file for bankruptcy and be unable to continue in our business. There is also a risk that we could face litigation and regulatory claims that could have a material adverse effect on our financial condition, operating results, and business.

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The Company and our Principal Executive Officer entered into a Stipulation for Consent Order with the State of Colorado.

The Company and our Principal Executive Officer, Troy Levy (the “Respondents”), entered into a Stipulation for Consent Order, Case No. 2019 CDS-035, on November 27, 2019 (the “Order”) in lieu of a hearing, following receipt of a subpoena duces tecum from the Colorado Division of Securities. The Order recited that the Commissioner had reviewed allegations of the staff of the Securities Commissioner of Colorado which had alleged unregistered securities of the Company were sold by Respondents in the State of Colorado in violation of Section 11-51-301 of the C.R.S. which securities had not been determined to be exempt from registration requirements. As had been agreed by Respondents, the Order, in summary, required the Respondents to rescind a securities purchase transaction with a Colorado resident through payment in the amount of $6,049 for the Colorado investor’s securities, to not take any action or make a public statement denying or creating the impression that the Order lacked a factual basis, and to comply with the Colorado Securities Act with regard to all future offers and sales of securities covered by the Colorado Securities Act.

We have entered into transactions with related parties in the past and have an outstanding related-party liability with the Company’s President, Troy Levy for accrued unpaid salary.

We owe certain sums to our chief executive officer and president Troy Levy. At December 31, 2019 and 2020, the Company owed $212,518 and $358,070, respectively, to Mr. Levy, which quantities represent unpaid salary. Related party transactions, generally, carry potential risks for self-dealing and the possibility that transactions could be approved upon terms not considered “arms length” and could be considered too generous to the related party. We intend to adopt special procedures to address the approval of related party transactions including a special committee review process. However, because we are an emerging growth company with limited resources at this time, we have not yet adopted a conflict of interest policy or related party transaction policy for approval of interested party transactions. Investors may not agree with the terms of our related party transactions. See “Interest of Management and Others in Certain Transactions—Transactions with Related Persons”.

There is substantial doubt about our ability to continue as a going concern.

The Company’s ability to continue as a going concern is dependent upon our ability to generate future profitable operations and/or obtain the necessary financing to meet our obligations and repay our liabilities arising from normal business operations when they become due.

There are few businesses that have pursued a strategy or investment objective similar to the Company’s.

The Company may not gain market acceptance from potential investors, potential horse sellers or service providers within the racehorse ownership/syndicate industry, including insurance companies, syndicate managers, training facilities or maintenance partners. This could result in an inability of the management team to operate the asset profitably. This could impact the issuance of further securities and acquisition of additional underlying assets by the Company. This would further inhibit market acceptance of the Company, and if the Company does not acquire any additional underlying assets, investors would not receive any benefits which arise from economies of scale (such as reduction in offering costs as a large number of interests in underlying assets may be listed on subsequent offering statements, group discounts on mortality insurance, and the ability to monetize its underlying assets).

Our inability to retain management and key employees could impair the future success of the Company.

The successful operation of the Company is in part dependent on the ability of the management team to source, acquire and manage the underlying assets. As the Company has only been in existence since March 2017 and is an early-stage startup company, it has no long-term operating history within the horse racing sector, which evidences its ability to find, acquire, manage and utilize the underlying assets.

The success of the Company will be highly dependent on the expertise and performance of the management team, its expert network and other professionals (which include third party experts) to find, acquire, manage and utilize the underlying assets. There can be no assurance that these individuals will continue to be associated with the management team. The loss of the services of one or more of these individuals could have a material adverse effect on the underlying assets, in particular, their ongoing management and use to support the investment of the shareholders.

A significant growth in the number of personnel would place a strain upon the Company’s management and resources.

The Company may experience a period of significant growth in the number of personnel that will place a strain upon its management systems and resources. Its future will depend in part on the ability of its officers and other key employees to implement and improve financial and management controls, reporting systems and procedures on a timely basis and to expand, train, motivate and manage the workforce. The Company’s current and planned personnel, systems, procedures and controls may be inadequate to support its future operations.

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There is no assurance that the Company’s insurance coverage will be sufficient to cover all claims to which the Company may become subject.

Although the Company believes that the events and amounts of liability covered by its insurance policies will be reasonable, taking into account the risks relevant to its business, there can be no assurance that such coverage will be available or sufficient to cover claims to which the Company may become subject. If insurance coverage is unavailable or insufficient to cover any such claims, the Company’s financial resources, results of operations and prospects could be adversely affected.

There can be no assurances that the value of the racehorse (whether it is a Thoroughbred, Quarter Horse or Standardbred) which is owned by the Company will not decrease in the future which may have an adverse impact on the Company’s activities and financial position.

The business of owning, training and racing horses is a high-risk venture. There is no assurance that any horse and therefore any interest in such horse acquired by the Company will be successful. Horses are subject to aging, illness, injury and disease which may result in permanent or temporary retirement from racing, restrictions in racing schedules, layups, and even natural death or euthanasia of the animal. There can be no assurances that the value of the interest in the underlying asset which may be acquired and owned by the Company, will not decrease in the future or that the Company will not subsequently incur losses on the racing careers or sale or other disposition of any or all of the horses which the Company may acquire. No combination of management ability, experience, knowledge, care or scientific approach can avoid the inherent possibilities of loss.

While the Company believes that there is a market for horse breeding, training and racing, such a market is highly volatile. The horse industry is dependent upon the present and future values of horses and of the Company’s horse(s) in particular. The Company can provide no assurance that it will be successful in its proposed activity. The expenses incurred may result in operating losses for the Company and there is no assurance that the Company will generate profits or that any revenues generated will be sufficient to offset expenses incurred or would result in a profit to the Company. As a result, it is possible that investors will lose all or a substantial part of their investment in the Company. Additionally, there is no assurance that there will be any cash available for distribution.

The cost of racing is unpredictable and speculative and may negatively impact the Company’s ability to generate revenue.

Increases in operation costs, labor rates and other variable costs, such as costs of feed and grain and costs of transporting animals (all of which are subject to inflationary pressure and should be expected to increase), to an extent which cannot be matched by increases in revenue. The racehorse industry, like other industries, is subject to labor disputes, labor shortages, and government intervention, changes in laws, licensing or regulatory restrictions may adversely impact the availability of grooms, trainers, jockeys and other horse industry workers. Adverse weather and economic conditions may result in unforeseen circumstances including, without limitation, restrictions on attendance at a particular race or racetrack, ability to transport the horses, and increases in costs or decreases in revenues. Changes in government regulations, whether or not relating to the horse racing industry, may result in additional expenses or reduced revenue from operations.

If a horse is unsuccessful in racing, becomes sick or injured, its value will be adversely affected which may have a negative impact of the Company’s valuation and revenue.

Horse racing is extremely speculative and expensive. In the event that a horse in which the Company has an interest was to be transported to various tracks and training centers throughout the United States, and thus exposed too many other horses in training, the risk of illness, injury or death increases significantly. A horse in which the Company has an interest must earn enough through racing to cover expenses of boarding and training. If a horse in which the Company has an interest is unsuccessful in racing, its value will be adversely affected. Furthermore, revenues from racing are dependent upon the size of the purses offered. The size of the purses depends in general on the extent of public interest in horse racing, and in particular on the relative quality of the specific horses in contention in any specific meeting or race. Although public interest has been strong in recent years, there is no assurance that public interest will remain constant, much less increase. Legalized gambling proliferating in many states threatens to curtail interest in horse racing as a means of recreation. In addition, there is no assurance that the horse in which the Company has an interest will be of such quality that they may compete in any races which offer purses of a size sufficient to cover the Company’s expenses.

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Horse racing could be subjected to restrictive regulation or banned entirely which could adversely affect the conduct of the Company’s business.

The racing future of and/or market for the horses in which the Company has an interest depends upon continuing governmental acceptance of horse racing as a form of legalized gambling. Although horse racing has a long history of acceptance in the United States and as a source of revenue, at any time, horse racing could be subjected to restrictive regulation or banned entirely. The value of the interest in the underlying asset would be substantially diminished by any such regulation or ban. Horse racing is regulated in various states and foreign countries by racing regulatory bodies which oversee the conduct of racing as well as the licensing of owners, trainers and others. Further, other forms of gambling are being approved throughout the United States and therefore no assurance can be provided that the legalization of other forms of gambling and competition from non-gambling sports and other activities will not adversely affect attendance and participation, and therefore the profitability of horse racing and sales. Lastly, our ownership structure is novel and may prepare us to seek regulatory approval to race in certain jurisdictions.

The Company may not purchase insurance on its horse which could require Company resources to be spent to cover any losses from the death or injury of a horse.

The decision to purchase insurance on a horse is made on a horse-by-horse basis. There is no guarantee that a horse which the Company has an interest will be insured. Mortality insurance insures against the death of a horse. Medical insurance covers possible risks of injury during racing or training. Liability insurance covers the risk that the horse in which the Company has an interest causes death, injury or damage to persons or property. Without insurance the Company is responsible for the cost of injury of veterinary expenses, surgery, and rehabilitation, or in the event of death, the Company will lose its investment in the horse. The payment of such liabilities may have a material adverse effect on our financial position.

A decrease in average attendance per racing date coupled with increasing costs could jeopardize the continued existence of certain racetracks which could negatively impact the Company’s operations.

A decrease in average attendance per racing date coupled with increasing costs could jeopardize the continued existence of certain racetracks which could impact the availability of race tracks available for horses in which the Company has an interest to race at and then negativity impact its operations.

Industry practices and structures have developed which may not be attributable solely to profit-maximizing, economic decision-making which may have an adverse impact on our Company’s activities business.

Because horse racing is a sport as well as a business, industry practices and structures have developed which not be attributable solely to profit-maximizing, economic decision-making. For instance, a particular bloodline could command substantial prices owing principally to the interest of a small group of individuals having particular goals unrelated to economics. A decline in this interest could be expected to adversely affect the value of the bloodline.

Investors may only own a minority interest in underlying assets and as a result may not have sufficient control regarding the training or racing of the horse(s).

The Company will not always own a majority interest in a particular horse. Therefore, despite its best efforts to build in oversight rights and major decision rights (such as the sale of the underlying asset) the Company may have minimal input with regard to the race selection and training of the horse(s). As a result, the Company may be dependent on the majority owners’ decisions as to when and where to race or show the horse and to its training regime. Additionally, there are situations in which a trainer or owner may have a conflict of interest which could negatively impact the ability of a horse to be placed in a particular race and given priority in workout times, jockeys or stabling.

Market shortages may impact the ability of the Company to generate revenue.

The Company will primarily engage in horse racing in the United States. The future success of these activities will depend upon the ability of the management team to purchase an interest in high-quality horses. The future success of these activities also depends upon whether the horse is being handled by highly skilled trainers and ridden by highly skilled jockeys. Because horse racing is an intensely competitive activity and the Company will be competing with a number of persons who have substantially greater experience and financial resources than Company to purchase interests in the best racehorses, there can be no assurance that the Company will be successful in the endeavors of pursuing certain racehorses. Further, once purchased, because the Company may have only a minority interest in such horse, the Company will have limited input into the training, handling, and management of the horse and therefore can make no assurances as to the success of the investment.

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The Company will make dividend payments only in extraordinary circumstances, as revenues are irregular, seasonal, and unpredictable.

The revenues, if any, of the Company may be highly irregular and seasonal. While the management team will endeavor to sell horses or interests in horses for cash at the time of sale, there can be no assurance that other payment terms will not be required by the relevant market conditions. While the Company hopes to pay extraordinary dividends if appropriate under the circumstances, including if our purse revenues increase, you should be aware that the consequent variance in the amount or the timing of the Company’s dividends, if any, could pose particular risks for investors who seek regular scheduled dividend payments.

The Company may not raise enough funds or have enough money to purchase the best blood-line champion horses to generate purses.

The horseracing industry is highly competitive and speculative. Horseracing in the United States and in foreign countries draws competitors and participants from locations throughout the United States and overseas, who have been in the business of horseracing for many years and have substantially greater financial resources than Company. The Company will be competing in its racing and selling activities with such persons. Similarly, horse markets are international, and auctions are frequently internationally advertised. This can be favorable in that it increases the value of the underlying assets but, by the same token, Company has little influence and may not be able to compete with such competitors in the acquisition of interests in horses. The Company will be competing in the purchase and sale of horses with most of the major horse breeders and dealers in the United States and foreign countries. Thus, prices at which the Company buys or sells its interests in the underlying assets may vary dramatically. Market factors, which are beyond the Company’s control, will greatly affect the profitability of the Company. Such factors include, but are not limited to, auction prices, private sales, foreign investors, federal income tax treatment of the racing industry and the size of racing purses.

Risks Related to the Units and this Offering

An investment in our Company is a speculative investment and, therefore, no assurance can be given that you will realize your investment objectives.

No assurance can be given that investors will realize a return on their investments in us. For this reason, each prospective investor for our Company should carefully read these Risk Factors. All such persons or entities should consult with their legal and financial advisors prior to making an investment in the Company.

The offering price of $3.50 per Unit has been arbitrarily determined by us and does not necessarily bear any relationship to our assets, net worth, operations or any other generally recognized criteria of value. An investment in our company is highly speculative and the Units should not be purchased by anyone who cannot bear the financial risks of this investment for an indefinite period of time and who cannot afford the loss of his or her entire investment.

There is no public trading market for our shares of Class A Shares.

There is currently no public trading market for our Company, and we cannot guarantee that any such market will ever develop. If an active public trading market for our shares of Class A Common Stock does not develop or is not sustained, it may be difficult or impossible for you to resell your shares of our Class A Common Stock at any price. Even if a public market does develop, the market price could decline below the amount you paid for your shares of our Class A Common Stock.

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We are dependent upon the proceeds of this Offering to provide funds to develop our business. There are no assurances we will raise sufficient capital to enable us to develop our business.

We are dependent upon the proceeds from this Offering to provide funds for the development of our business. If we sell less than all of the Units offered hereby, we will have significantly less funds available to us to implement our business strategy, and our ability to generate any revenues may be adversely affected. While this Offering seeks to raise a portion of the capital we will need, there are no assurances we will generate the financing needed to complete our business objectives. Even if we sell all of the Units offered hereby, we cannot guarantee prospective investors that we will ever generate any significant revenues or report profitable operations, or that our revenues will not decline in future periods. We do not have any firm commitments to provide capital, and we anticipate that we will have certain difficulties raising capital given the development stage of our Company and the lack of a public market for our securities. Accordingly, we cannot assure you that additional working capital as needed will be available to us upon terms acceptable to us. If we do not raise funds as needed, our ability to continue to implement our business model is in jeopardy and we may never be able to achieve profitable operations. In that event, our ability to continue as a going concern is in jeopardy and you could lose all of your investment in our Company.

You will experience further dilution if we issue additional equity securities in future fundraising transactions.

You will experience further dilution if we issue additional equity securities including without limitation preferred shares in future fundraising transactions. We may in the future offer additional shares of our Class A Common stock or other securities convertible into or exchangeable for our common stock at prices that may not be the same as the price per share in this Offering. The price per share at which we sell additional shares of our Class A Common stock, or securities convertible or exchangeable into common stock, in future transactions may be higher or lower than the price per share paid by investors in this Offering and investors purchasing shares or other securities in the future could have rights superior to existing shareholders.

Possible changes in federal tax laws may affect your investment.

The Internal Revenue Code (the “Code”) is subject to change by Congress, and interpretations of the Code may be modified or affected by judicial decisions, by the Treasury Department through changes in regulations and by the Internal Revenue Service through its audit policy, announcements, and published and private rulings. Although significant changes to the tax laws historically have been given prospective application, no assurance can be given that any changes made in the tax law affecting the Company would be limited to prospective effect. Accordingly, the ultimate effect on an investor’s tax situation may be governed by laws, regulations or interpretations of laws or regulations which have not yet been proposed, passed or made, as the case may be.

Our management team has full discretion as to the use of proceeds from this Offering.

We presently anticipate that the net proceeds from this Offering will be used for general real estate working capital, including corporate overhead, payments we are obligated to make for the and the maintenance of our real estate and equipment.  Proceeds from Units sold to date have been used, in part, for the purchase of Circle 8 Ranch and the investment in Game of Silks.   If the business plan for Game of Silks is not successfully executed, the Company may never generate any returns from the investment.

We reserve the right, however, to use the funds from this Offering for other purposes not presently contemplated which we deem to be in our best interests in order to address changed circumstances and opportunities.

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There may be state law restrictions on an investor’s ability to sell the Units offered hereby.

Each state has its own securities laws, often called “blue sky” laws, which (1) limit sales of securities to a state’s residents unless the securities are registered in that state or qualify for an exemption from registration and (2) govern the reporting requirements for broker-dealers and stock brokers doing business directly or indirectly in the state. Before a security is sold in a state, there must be a registration in place to cover the transaction, or it must be exempt from registration. We do not know whether our securities will be registered, or exempt, under the laws of any states. There may be significant state blue sky law restrictions on the ability of investors to sell, and on purchasers to buy, our securities. Investors should consider the resale market for our securities to be limited. Investors may be unable to resell their securities, or they may be unable to resell them without the significant expense of state registration or qualification.

You will not have the ability to actively influence the day-to-day management of our business and affairs.

Our management team has sole power and authority over the management of our Company. Furthermore, our management team may only be removed by the Board on which our principal executive officer, Troy Levy, sits.

You will not have an active role in our Company’s management, and it would likely be difficult to cause a change in our management. As a result, you will not have the ability to alter our management’s path if you feel they have erred.

Shareholders’ voting rights provide limited ability to control the Company and even if the Maximum Amount is raised our President and Chief Executive Officer will retain voting control of the Company.

The Board has the unilateral ability to amend the Bylaws in certain circumstances without the consent of the investors, and the investors only have limited voting rights in respect of our shares of Class A Common Stock. Investors will therefore be subject to any amendments the management team makes (if any) to the Bylaws and also any decision it takes in respect of the Company, which the investors do not get a right to vote upon. Investors may not necessarily agree with such amendments or decisions and such amendments or decisions may not be in the best interests of all of the investors as a whole but only a limited number.

Although no shares of our Class B Common Stock are being sold in this Offering, investors should also be aware that a holder of shares of our Class B Common Stock is entitled to ten (10) votes for each share held by such holder of record. As of the date of this Offering Circular, we have issued 10,000,000 shares of our Class B Common Stock to Troy Levy, our President.

Funds from purchasers accompanying subscriptions for the Units will not accrue interest prior to admission of the subscriber as a shareholder in the Company, if it occurs, in respect of such subscriptions.

The funds paid by purchasers for the Units will go into the Company’s general operating account or the account of the Company’s escrow agent, if any, pending approval of the investor. Purchasers will not have the use of such funds or receive interest thereon pending the Company’s due diligence and approval of each investor. No subscriptions will be accepted, and no Units will be sold unless valid subscriptions for the Offering are received and accepted prior to the termination of the offering period. If we terminate the Offering prior to countersigning the subscription agreement and accepting a subscriber’s subscription, funds will be returned, without interest or deduction, to the proposed investor.

Provisions of our Amended and Restated Articles of Incorporation and Bylaws may delay or prevent a takeover which may not be in the best interests of our shareholders.

Provisions of our Amended and Restated Articles of Incorporation and Bylaws may be deemed to have anti-takeover effects, including without limitation our dual class structure of Class A and Class B common stock, and also including when and by whom special meetings of our shareholders may be called, and may delay, defer or prevent a takeover attempt. In addition, certain provisions of the Florida Statutes also may be deemed to have certain anti-takeover effects which include that control of shares acquired in excess of certain specified thresholds will not possess any voting rights unless these voting rights are approved by a majority of a corporation’s disinterested stockholders.

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DILUTION

The following table summarizes the differences between the total consideration and the weighted-average price per share of our Class A and Class B Common Stock paid by, on the one hand, officers, directors, and affiliates of the Company who have acquired shares of our Class A Common Stock prior to the date of this Offering Circular and, on the other hand, investors participating in this Offering, before deducting estimated Offering expenses of $1,500,000, assuming that the maximum gross proceeds from the Offering of $49,980,000 are raised and that the number of Units presented on the cover of the Offering Circular are sold. As of the date of this Offering Circular, an aggregate of 51,523,404 shares of our Class A Common Stock are issued and outstanding, 10,000,000 shares of our Class B Common Stock are issued and outstanding, and no shares of our Preferred Stock are issued and outstanding. In addition, there are 5,500,000 shares of our Class A Common Stock reserved for issuance under our 2020 Equity Incentive Plan, of which no shares of our Class A Common Stock are currently issuable and of which no grants are outstanding. Future awards could be issued at per share prices above or below the price per Share offered in this Offering.

The table below does not include any exercise of our outstanding 250,000 warrants to purchase Class A Common Stock or any awards under the 2020 Equity Incentive Plan.

	Securities Purchased					Total Consideration						Weighted-Average Price per share of our
	Number		Percentage			Amount			Percentage			Common Stock
Existing stockholders before this Offering		58,508,552		80	%	$	5,394,398			9.7	%	$	0.092
New investors in this Offering		11,760,000		16.0	%	$	49,980,000	(1)		74.9	%	$	4.250
Total		70,268,552		100.0	%	$	55,374,398			100.0	%	$	0.79

__________

(1) Assumes the sale of 5,880,000 Units at $3.50 per Unit for gross proceeds of $49,980,000, assuming the exercise of all 5,880,000 Warrants at an exercise price of $5.00 per Warrant.

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PLAN OF DISTRIBUTION AND SELLING SECURITYHOLDERS

The Units are being offered pursuant to Regulation A of Section 3(b) of the Securities Act for Tier 2 offerings, by the management of the Company on a “best-efforts” basis directly to purchasers who satisfy the requirements set forth in Regulation A. We have the option in our sole discretion to accept less than the minimum investment. There is no aggregate minimum to be raised in order for the Offering to become effective and therefore the Offering will be conducted on a “rolling basis.” This means we are entitled to begin applying “dollar one” of the proceeds from the Offering towards our business strategy, research and development expenses, Offering expenses (estimated as $1,075,800 which include without limitation legal, accounting, printing, due diligence, marketing, selling and other costs incurred in the Offering of the Units), commissions, working capital, reimbursements, and other uses as more specifically set forth in “Use of Proceeds to Issuer.”

Our Offering will expire on the first to occur of (a) the sale of all 5,880,000 of our Units offered hereby, (b) March 10, 2023 or (c) when our Board elects to terminate the Offering.

There is no arrangement to address the possible effect of the Offering on the price of our Class A Common Stock.

We reserve the right to offer the Units through broker-dealers who are registered with FINRA. The Company has engaged Dalmore Group, LLC (“Dalmore”), a New York limited liability company and broker-dealer registered with the SEC and a member of FINRA, to provide broker-dealer services in connection with this Offering. Dalmore’s services include the review of investor information, including Know Your Customer data, Anti-Money Laundering and other compliance checks, and the review of subscription agreements and investor information. As compensation for these services, the Company has agreed to pay Dalmore a one-time payment for out of pocket expenses of $5,000, plus a fee equal to one hundred (100) basis points on the aggregate amount raised by the Company from the sale of the Units (excluding proceeds from the exercise of Warrants), as described in the Broker-Dealer Agreement between the Company and Dalmore. This will only start after FINRA Corporate Finance issues a No Objection Letter for the Offering. The Company has authorized Dalmore to deduct the fee directly from Dalmore’s third party escrow or payment account. The Company has also engaged Dalmore as a consultant to provide ongoing general consulting services relating to the Offering such as coordination with third party vendors and general guidance with respect to the Offering. The Client has agreed to pay a one-time consulting fee of $20,000 which will be due and payable immediately after FINRA issues a No Objection Letter and the Client receives SEC Qualification.

Generally speaking, Rule 3a4-1 provides an exemption from the broker-dealer registration requirements of the Exchange Act for persons associated with an issuer that participate in an offering of the issuer’s securities. None of our officers or directors are subject to any statutory disqualification, as that term is defined in Section 3(a)(39) of the Exchange Act. None of our officers or directors will be compensated in connection with his participation in the Offering by the payment of commissions or other remuneration based either directly or indirectly on transactions in our securities. None of our officers or directors are, or have been within the past 12 months, a broker or dealer, and none of them are, or have been within the past 12 months, an associated person of a broker or dealer. At the end of the Offering, our officers or directors will continue to primarily perform substantial duties for the Company or on its behalf otherwise than in connection with transactions in securities. Our officers or directors will not participate in selling an offering of securities for any issuer more than once every 12 months other than in reliance on Exchange Act Rule 3a4-1(a)(4)(i) or (iii) except that for securities issued pursuant to rule 415 under the Securities Act, the 12 months shall begin with the last sale of any security included within one rule 415 registration.

Selling Security Holders

No securities are being sold for the account of security holders; all net proceeds of this offering will go to the Company.

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USE OF PROCEEDS TO ISSUER

If the Maximum Amount is sold in this Offering, the maximum gross proceeds from the sale of our Units in this Offering will be $49,980,000. The net proceeds from the total Maximum Amount are expected to be approximately $48,904,200, after the payment of offering costs (including filing fees and legal, accounting, printing, due diligence, marketing, selling and other costs incurred in the Offering of the Units. The estimate of the budget for offering costs is an estimate only and the actual offering costs may differ. We expect from time to time to evaluate the acquisition of businesses, intellectual property, products and technologies for which a portion of the net proceeds may be used, although we currently are not planning or negotiating any such transactions. The following table represents management’s best estimate of the uses of the net proceeds received from the sale of Units in this Offering, assuming the sale of, respectively, 100%, 75%, 50% and 25% of the Units offered for sale in this Offering.

Percentage of Offering Sold

		100%		75%		50%		25%
Circle 8 Ranch Purchase	$	1,500,000	$	1,125,000	$	750,000	$	375,000
Ranch – Increased Land	$	7,500,000	$	5,625,000	$	3,750,000	$	1,875,000
Ranch – Capital Improvements	$	2,500,000	$	1,875,000	$	1,250,000	$	625,000
Horse Acquisitions	$	16,980,000	$	12,735,000	$	8,490,000	$	4,245,000
Horse Breeding – Stud Fees	$	3,000,000	$	2,250,000	$	1,500,000	$	750,000
Horse Investment – Stallion Shares	$	8,000,000	$	6,000,000	$	4,000,000	$	2,000,000
Ranch Equipment – Tractor and Eurosizer	$	1,500,000	$	1,125,000	$	750,000	$	375,000
Barn and Track – Capital Improvements	$	4,000,000	$	3,000,000	$	2,000,000	$	1,000,000
Increased Branding & Marketing Efforts	$	2,000,000	$	1,500,000	$	1,000,000	$	500,000
Office Systems and Upgrades Costs	$	500,000	$	375,000	$	250,000	$	125,000
Increased Operational Horse and Ranch Expenses	$	2,500,000	$	1,875,000	$	1,250,000	$	625,000
TOTAL	$	49,980,000	$	37,485,000	$	24,990,000	$	12,495,000

We began our operations in March 2017 and have a very limited operating history. Our net loss was $(1,641,186) for the year ended December 31, 2020, as compared to $(1,635,867) for year ended December 31, 2019. Our plan of operations for the next few years includes (i) potentially purchasing our neighboring farm or other ranches; (ii) making capital improvements to the recently purchased Circle 8 ranch; (iii) acquiring racehorses for breeding, racing purposes and pinhooking; (iv) paying stud fees for purposes of horse breeding; (v) investing in stallion shares, which provides us with the ability to breed such popular stallions for life and participate in profits; (vi) purchasing ranch equipment, such as a tractor and Eurosizer; (vii) upgrading our barn operations; (viii) increasing our branding and marketing efforts; (ix) making office systems upgrades; and (x) paying increased operational horse and ranch expenses. We would require funds through this offering to meet these objectives.

The amounts set forth above are our current estimates for such development activities, and we cannot be certain that actual costs will not vary from these estimates. Our management has significant flexibility and broad discretion in applying the net proceeds received in this Offering. We cannot assure you that our assumptions, expected costs and expenses and estimates will prove to be accurate or that unforeseen events, problems or delays will not occur that would require us to seek additional debt and/or equity funding, which may not be available on favorable terms, or at all. See “Risk Factors” for more information regarding the risks associated with an investment in our Units.

The Company intends to use a portion of the proceeds raised in this Offering to fund the compensation payable to its executive officers, as described under “Compensation of Directors and Executive Officers” below. The Company does not currently pay its directors cash compensation and does not expect to compensate them with the proceeds of the Offering. In addition, the Company reserves the right to use a portion of the proceeds from this Offering to repay the Company’s outstanding indebtedness.

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Our management has broad discretion and flexibility to use the net proceeds from this Offering for general corporate purposes, including, without limitation, acquisitions, repayment of debt and operating expenses, and other general working capital purposes.

This expected use of the net proceeds from this Offering represents our intentions based upon our current financial condition, results of operations, business plans and conditions. As of the date of this Offering Circular, we cannot predict with certainty all of the particular uses for the net proceeds to be received upon the closing of this Offering or the amounts that we will actually spend on the uses set forth above. The amounts and timing of our actual expenditures may vary significantly depending on numerous factors. As a result, our management will retain broad discretion over the allocation of the net proceeds from this Offering.

We believe that if we raise the Maximum Amount in this Offering, we will have sufficient capital to finance our operations for at least the next three (3) years. However, if we do not sell the Maximum Amount or if our operating and development costs are higher than expected, we will need to obtain additional financing prior to that time. Further, we expect that during or after such three (3) period, we will be required to raise additional funds to finance our operations until such time that we can conduct profitable revenue-generating activities.

Pending our use of the net proceeds from this Offering, we may invest the net proceeds in a variety of capital preservation investments, including short-term, investment grade, interest bearing instruments and United States government securities. We may also use a portion of the net proceeds for the investment in strategic partnerships and possibly the acquisition of complementary businesses, products or technologies, although we have no present commitments or agreements for any specific acquisitions or investments.

DESCRIPTION OF BUSINESS

Overview

The Company is a thoroughbred horse racing company that cultivates and promotes growth of its assets with resources in every face of the thoroughbred racing industry. The Company operates its business primarily through three functions: (i) horse ownership syndication; (ii) horse training, breeding and horse racing; and (iii) pinhooking. See “Description of Business—Our Business.”

Company Information

The Company was incorporated on March 31, 2017 in the State of Florida and was authorized to do business in the State of Kentucky on February 19, 2019.

The Company’s principal office is located at 1740 Grassy Springs Road, Versailles, Kentucky 40383. The Company’s telephone number is +1 (561) 513-8767 and website address is https://www.tropicalracing.com/. The information contained therein or accessible thereby shall not be deemed to be incorporated into this Offering Circular.

Pursuant to the Company’s Amended and Restated Articles of Incorporation (the “Articles of Incorporation”), dated January 10, 2020, the Company is authorized to issue Two Hundred Fifty Million (250,000,000) shares which consist of the following: (i) Two Hundred Million (200,000,000) shares of Class A Common Stock; (ii) Twenty-Five Million (25,000,000) shares of Class B Common Stock; and (iii) Twenty-Five Million (25,000,000) shares of Preferred Stock. As of the date of this Offering Circular, the Company has (i) 48,195,443 shares of Class A Common Stock outstanding; (ii) 10,000,000 shares of Class B Common Stock of the Company outstanding; and (iii) no shares of Preferred Stock of the Company outstanding.

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Intercorporate Relationships

The Company has one active wholly-owned subsidiary, Circle 8 Ranch Corp. (“Circle 8 Ranch”), a corporation organized under the State of Florida on or about March 9, 2019. The Company’s horses are housed and trained at the Circle 8 ranch, a state-of-the-art facility located 15 minutes from Lexington, Kentucky.  The Circle 8 ranch was recently purchased from a portion of the proceeds of the Units sold to date. See “Description of Property.” Certain subsidiaries of the Company are inactive and have been or will be dissolved.

The following chart identifies the Company’s sole active wholly-owned subsidiary, its applicable governing jurisdiction and the percentage of the voting securities which are beneficially owned, or controlled or directed, directly or indirectly, by the Company: 

Tropical Racing, Inc. (Florida)
	100%
Circle 8 Ranch Corp. (Florida)

Recent Developments

Acquisition of Circle 8 Ranch

On April 1, 2019, the Company entered into a Lease and Purchase Option Agreement (the “Lease and Purchase Option Agreement”) with Grassy Springs, LLC, a Kentucky limited liability company, for the lease and purchase option of 200 acres of agricultural land located at 1740 Grassy Springs Road, Versailles, Kentucky 40383 (the “Circle 8 Ranch”). The Company paid $8,500 in monthly rent and made a cash payment of $100,000 as an option to purchase the farm for $2,945,000. The land includes several structures, including a farm house, out buildings, and a main barn with 23 stalls, tack rooms, wash stalls and lab area, in addition to executive offices. The residence on the land is 2,450 square feet of newly renovated living space. The buildings include an equipment barn, shop, and farm implement storage. The land also includes 14 plank fenced paddocks, 6 large fields, a 5/8-mile grass training track, and a pond situated on more than one acre.

On February 10, 2022, the Company executed the option under the Lease and Purchase Option Agreement, purchasing the Circle 8 Ranch for $2,945,000 to include both the real estate and equipment.

Acquisition of Ownership Interest in Game of Silks

On December 10, 2021, the Company announced by press release that it is a lead investor and strategic partner in newly-formed Game of Silks, Inc., a Delaware corporation.

Over the last year management believes the Company has made great strides expanding the Company’s foothold in the thoroughbred industry increasing potential revenue streams and asset bases in technology by acquiring an ownership interest in a Web 3.0 (metaverse) in a Play to Earn game called the Game of Silks. Through the Company’s multifaceted investment strategy in all aspects of the thoroughbred industry, Tropical Racing became a lead investor in Game of Silks – a pioneer derivative gaming platform that intends to leverage a blockchain-enabled metaverse to parallel the real world of thoroughbred horse racing.  The Silks metaverse will be powered by a play-to-earn (P2E) gaming economy where anyone can experience the thrill of owning racehorses and horse farms, while reaping valuable tokens through skilled gameplay and contributions to the ecosystem. The Silks community is expected to have the ability to acquire, collect, trade, and interact with digital assets that represent actual thoroughbred racehorses in the real world.  The Company also anticipates expanding into a Bloodstock division in the coming months which should provide the Company the opportunity to turn over inventory quicker and pinhook many horses through the partnership with consignors in major sales.

The Horse Racing Industry in the U.S.

The thoroughbred horse racing industry is a traditional, well established industry that maintains a base of loyal customers. Such customers not only recognize the financial potential of racehorse investing but also the lifestyle investment involved in the fast-paced and exciting world of thoroughbred horse racing.

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Economic Impact in the United States

As a large, economically diverse industry, the United States horse industry contributes significantly to the American economy. According to the American Horse Council Foundation 2017 National Economic Impact Study (the “American Horse Council Foundation Study”), the horse industry contributes approximately $50 billion in direct economic impact to the United States economy and has a direct employment impact of 988,394 jobs. Additionally, the horse racing industry itself contributes $38 billion in direct wages, salaries and benefits. From those direct effects, the horse industry’s contribution ripples out into other sectors of the economy. Adding these ripple effects results in an estimate of the total contribution of the horse industry to the U.S. economy of $122 billion, and a total employment impact of 1.7 million jobs. More specifically, the United States horse racing track market was valued at approximately $3.8 billion according to Statista 2020.

The Geographic Diversity in the Horse Industry

The horse industry reaches into the far corners of all 50 states. The industry impact is generated from the smallest of rural areas to the largest cities. Certain activities such as breeding, training and maintenance are traditionally conducted in more rural areas, while racetracks and horse shows have generally operated in more urban areas. There are an estimated 7.2 million horses in the United States, with an approximate 1,224,483 horses racing according to the American Horse Council Foundation Study. In addition, the top three states with the greatest number of horses are Texas (approximately 767,100 horses); California (approximately 534,500 horses); and Florida (approximately 387,100 horses).

Moreover, the equine industry in Kentucky is the number one producer of Thoroughbreds, with 30% of the national foaling total. According to the 2012 Kentucky Equine Survey, Kentucky is home to 242,400 horses and 35,000 horse farms. More than 1 million acres in Kentucky are devoted to equine use, and the total value of its horses and horse-related assets (land, buildings, equipment, etc.) is estimated at $23.4 billion. In-state horse operations also spend more than $1 billion annually, with 77 percent of that remaining in the Bluegrass. While Kentucky may not have more total horses than Texas, California, or Florida, Kentucky horse sales and income from horse-related operations bring more than $1 billion to the commonwealth each year. This is due to the large number of Thoroughbred horses bred, born, raised, and sold in Kentucky for a career in racing. Given its home base in Kentucky, the horse capital of the world, and ties to South Florida, the Company believes it offers a unique investment opportunity.

COVID-19 Pandemic

The COVID-19 pandemic has affected virtually every industry, profession and community around the world. Equestrian athletes largely have been unable to compete, train, or effectively do their jobs in the same way as those able to work remotely. Moreover, horses require care on a daily basis, including daily exercise.

The Company was unable to partake in the Keeneland 2020 Spring Race Meet, scheduled for April 2 -24, 2020, due to its cancellation based on health and safety concerns surrounding the outbreak of COVID-19. As a result, the Company transported certain of its horses back to Florida earlier than expected and did not transport certain of its horses from Florida to Kentucky as the Company would do under normal conditions. In addition, the Churchill Downs Racetrack postponed its meet three weeks later than it normally would take place in May, which caused the Company to adjust its horse shipping schedule. Nonetheless, the Company has hosted some of the earliest shows for equestrians in South Florida after restrictions began to lift from the COVID-19 pandemic shutdown. Moreover, management believes there has been no significant impact on the Company’s revenues due to the COVID-19 pandemic, as the well-being of the Company’s horses (including any breeding activities) has not been affected to date. Throughout the COVID-19 pandemic, the horses are receiving care on a daily basis and medical attention as needed. In addition, during the beginning of the COVID-19 pandemic, a few of the sales auctions in which we normally participate were cancelled. Nonetheless, sales companies have adapted by upgrading their online bidding systems to make it easier to purchase horses virtually, including adding videos of the horses online and making it more accessible for veterinarians to obtain x-rays and video scopes for potential purchases online. As a result, we have been able to acquire horses at the same anticipated rate as before the COVID-19 pandemic.

The majority of the Company’s tracks stayed open for training, and each individual track set its own protocols to protect individual workers. Such tracks limited or did not allow non-essential workers or patrons in certain locations. Further, the Company ensured that anyone who had a fever or experienced any symptoms, including diarrhea, cough, runny nose, or headache, did not come onto Company property.

Our Business

The Company offers affordable partnerships into the “Sport of Kings” for people who want to get involved in the fast-paced and exciting world of thoroughbred horse racing. The Company operates its business primarily through three revenue streams: (i) horse ownership syndication; (ii) horse training, breeding and horse racing; and (iii) pinhooking. Each of these revenue streams are discussed below.

Horse Ownership Syndication

Many horse enthusiasts would like to say that they bred the winner of the big race. Owning a racehorse winner and, especially, breeding and raising one, is a passion – a compelling and expensive goal. In the past, the door to ownership was only opened for those of substantial wealth, as the costs of purchasing a racehorse, as well as maintenance, training, feeding, veterinary care, and travel costs are expensive. What was once out-of-reach for many due to the financial obligations of buying a racehorse and maintaining that horse, has now become attainable with the cost-sharing offered by a partnership. Rather than one person purchasing one horse, the Company offers group partnerships where investors can purchase a percentage of one horse or a group of horses, thereby spreading the financial risks and expenses amongst all the partners.

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The Company’s management team also operates in a different manner than most traditional partnership groups. As a for profit business, the Company is not hesitant to move a non-producing horse to a new home or reinvest in a potential future prospect if the opportunity arises.

To ensure that every ownership experience is positive and that each investor reinvests and expands their racehorse ownership, the Company only sells a percentage of a horse when there is a fair value for its partners. Partnership groups of individual horses, as well as fractional ownership groups of 3 and 4-horse packages, are offered based on individual budgets, goals and the particularized needs of the investor.

The Company focuses not only on its partners individually, but also on making sure everyone is involved on strategy, communication, and industry news via email updates, phone calls, and meetings. The Company prides itself on delivering personal service and strives to build personal relationships. Partners are part of the Circle 8 Ranch team and, as a team, works together with the Company to choose the best career path for the horses by listening to input from trainers and veterinaries, as well as feedback from riders.

Horse Racing

The Company has a proven track record of horse training, breeding and expert selections in thoroughbred race horses. Our thoroughbreds race primarily in Florida, and we have also participated in races in California, New York, New Jersey and Kentucky. The following are just a few of the most recent, notable wins for the Company.

· Toretto- Homebred out of one of Tropical’s Foundation mare’s Angry Dragon Broke his maiden on September 26 2021 1st Place – IN a Maiden Special Weight with a Purse $52,000 at Gulfstream Park

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· Roughly A diamond – A Weanling purchase for $25,000 at the keeneland Sales Auction Broke her maiden at Gulfstream Park in a Maiden Special Weight $46,000 purse at Gulfstream Park. Roughly followed up this Victory in a Allowance race on News Year day 1/1/2022 at Tampa Racetrack with a her second victory.

· My man Flint- A weanling purchase at Keenland Sales Auction broke his Maiden in a Maiden $35,000 dollar claimer on 12/11/2021.

· Aizu – Homebred out of one of Tropical’s Foundation Mare’s Red Baroness finished 3^rd in an $86,000 dollar Allowance race at Keeneland on 10/24/21. She is a consistent racehorse being 1^st,2^nd and 3^rd 12 times out of 16 races. We look forward for Aizu to be part of our broodmare band next year.

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Pinhooking

Pinhooking is the business of purchasing young horses at one stage of their lives and then reselling them for a higher price at a different stage of their lives. For example, weanlings can be purchased at auctions or privately, and then resold as yearlings. Yearlings can be purchased and then trained to be sold as race-ready 2-year-olds.

Although it is always possible to sell a promising potential racehorse by private sale, the strongest market for these young thoroughbreds is at the multiple two-year-olds-in-training sales held annually at reputable sales companies around the country. These sales are frequented by trainers and owners across the U.S., as well as international buyers. Pinhooking is a consistent business model that typically shows a solid rate of return on investment (ROI). The average ROI in 2017 for yearlings and 2-year-olds was 88% according to Barrett’s March, Fasig-Tipton February, Keeneland April, OBS February, and OBS March.

In many ways, pinhooking is a science. It is based on instinct, experience, and market trends. When looking for pinhook prospects, the Company compiles all the important factors to choose the very best investment, while fitting a profile of what the end users want. The Company looks for elite equine athletes with good conformation, precocious pedigrees, marketable sire and dam lines, and performance. A team of bloodstock agents, veterinarians, and equine conformation, pedigree, and market analysis experts all study each prospect to give investors the advantage of a maximum return on their investments.

The Company not only works with private sellers, it also targets the major auctions across the globe to increase the ability to pick horses with the most potential. The Company is active at all major thoroughbred yearling sales, including the Keeneland September Sale, Saratoga Yearling Sale, and OBS Yearling Sale.

Once purchased, the yearlings are immediately received at the Circle 8 ranch in Versailles, Kentucky. The farm covers 200 acres, while the yearling complex is perfectly suited to young horses with spacious stalls, turn-out paddocks, and large pastures for abundant grazing and room to relax before their racing careers commence. Next, yearlings enter into breaking and training, which takes place at top facilities in the ideal fall/winter climate of Ocala, Florida. The horses are conditioned properly and then positioned properly at the right sale in the right location. For the first six to eight months after horses are purchased, they begin the process of becoming racehorses. When they enter sales preparation, they are conditioned with an exercise and feed program for athletic development that is custom tailored to that particular horse. Just like people, horses are individuals. Therefore, a “cookie-cutter” approach to training and diet isn’t beneficial to turning out the best racehorses. The Company studies its horses, learns their personalities, and tailors training accordingly to enhance the horses’ abilities to win at the track.

The main sales venues for two-year-old thoroughbreds include Ocala Breeders’ Sales Company (Florida), Keeneland (Kentucky), Fasig-Tipton (Florida, Maryland, California), and Barretts (California). The Circle 8 team sells at the nation’s most prominent training sales: OBS March, Fasig-Tipton March at Gulfstream and OBS April. It is at these sales that many of the nation’s top owners and trainers find their next racehorses, the very runners who go on to achieve success at the highest levels, including the Triple Crown races and Breeders’ Cup races.

The Company is an ongoing business and it buys and sells horses during public auctions and when private sales present themselves.

The horses noted below are owned by the Company as of the date of this Offering Circular:

1. ANGRY DRAGON

Kentucky - Bred

Year of Birth: 2008

Stallion: Smarty Jones

Dam: Screamer

Type: Broodmare

In Foal: Sky Mesa

2. RED BARONESS

Kentucky - Bred

Year of Birth: 2008

Stallion: Smarty Jones

Dam: Must be a Lady

Type: Broodmare

In Foal: Sky Mesa

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3. CELTIC MOONLIGHT

Florida - Bred

Year of Birth: 2014

Stallion: City Place

Dam: Penny at a Tim

Type: Broodmare

In Foal: Congrats

4. DURA CUIRE

Kentucky - Bred

Year of Birth: 2017

Stallion: Street Boss

Dam: Beaucoup

Type: Broodmare

In Foal: Practical Joke

5. TIME FOR HARLAN

Kentucky - Bred

Year of Birth: 2011

Stallion: Harlan Holiday

Dam: Time of Peace

Type: Broodmare

In Foal: Open

6. LONGSTOCKING

Pennsylvania - Bred

Year of Birth: 2012

Stallion: Into Mischief

Dam: Pot of Tricks

Type: Broodmare

In Foal: Open

7. PRECOCIOUS MISS

Florida - Bred

Year of Birth: 2016

Stallion: Winslow Homer

Dam: Golden Horseshow

Type: Broodmare

In Foal: Yoshida

8. SCHMISS

Kentucky - Bred

Year of Birth: 2014

Stallion: Hard Spun

Dam: Autumn Ash

Type: Broodmare

In Foal: Cupid

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9. BLUE WALE

Kentucky - Bred

Year of Birth: 2015

Stallion: Creative Cause

Dam: Lee Ann W

Dam Sire: Mr. Greeley

Type: Broodmare

In Foal: Fushachi Pegasus

10. COUNTLESS FUN

Kentucky - Bred

Year of Birth: 2017

Stallion: Ghostzapper

Dam: Countless Curlin

Type: Broodmare

In Foal: Maiden

11. ISTAN AGAIN

Kentucky - Bred

Year of Birth: 2016

Stallion: Istan

Dam: Tell Me Again

Type: Broodmare

In Foal: Upstart

12. ROSY SCENARIO

Kentucky - Bred

Year of Birth: 2017

Stallion: Malibu Moon

Dam: Divine Praises

Type: Broodmare

In Foal: Connect

13. MORE ROYALTY

Florida - Bred

Year of Birth: 2013

Stallion: More Than Ready

Dam: Royal Ancestry

Type: Broodmare

In Foal: Exaggerator

14. DREAMING AS ALWAYS

Kentucky - Bred

Year of Birth: 2011

Stallion: Broken Vow

Dam: Leonor Fini

Dam Sire: Peintre Celebre

Type: Broodmare

In Foal: Oscar Performance

15. DREAM SPINNER

Kentucky - Bred

Year of Birth: 2011

Stallion: Hard Spun

Dam: whatdreamsaremadeof

Type: Broodmare

In Foal: Open

16. TIZEMOTIONALGOLD 

Kentucky - Bred

Year of Birth: 2017

Stallion: Tiznow

Dam: Golden Motion

Type: Broodmare

In Foal: N/A

17. WINY

Chile - Bred

Year of Birth: 2016

Stallion: Looking At lucky

Dam: Winter Harbor

Type: Broodmare

In Foal: Open

18. YAFA

Florida - Bred

Year of Birth: 2018

Stallion: Handsome Mike

Dam: Red Baroness

Type: Broodmare

In Foal: Open

19. REGAL SERENADE

Illinois - Bred

Year of Birth: 2016

Stallion: Broken vow

Dam: Millenia

Type: Broodmare

In Foal: Open

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20. SHESOMAJESTIC

Kentucky - Bred

Year of Birth: 2016

Stallion: Majesticperfection

Dam: Shesoprovocative

Type: Broodmare

In Foal: Open

21. CHIPS AND SALSA

Florida - Bred

Year of Birth: 2018

Stallion: two steps salsa

Dam: homesteader

Type: Broodmare

In Foal: Open

22. 2022 DREAMING AS ALWAYS

Kentucky - Bred

Year of Birth: 2022

Stallion: gunrunner

Dam: Dreaming as Always

Type: Weanling

In Foal: N/A

23. 2022 SCHMISS

Kentucky - Bred

Year of Birth: 2022

Stallion: Cupid

Dam: Schmiss

Type: Weanling

In Foal: N/A

24. 2022 PRECOCIOUS MISS

Kentucky - Bred

Year of Birth: 2022

Stallion: Yoshida

Dam: Precocious Miss

Type: Weanling

In Foal: N/A

25. 2022 LONGSTOCKING

Kentucky - Bred

Year of Birth: 2022

Stallion: Midshipmen

Dam: Longstocking

Type: Weanling

In Foal: N/A

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26. 2022 ROSY SCENARIO

Kentucky - Bred

Year of Birth: 2022

Stallion: Global Campaign

Dam: Rosy Scenario

Type: Weanling

In Foal: N/A

27. 2022 REGAL SERENADE

Kentucky - Bred

Year of Birth: 2022

Stallion: Omaha Beach

Dam: Regal Serenade

Type: Weanling

In Foal: N/A

28. 2022 FIVE STAR FACTOR

Kentucky - Bred

Year of Birth: 2022

Stallion: runhappy

Dam: five star factor

Type: Weanling

In Foal: N/A

29. 2022 DO THE DANSE

Kentucky - Bred

Year of Birth: 2022

Stallion: audible

Dam: do the danse

Type: Weanling

In Foal: N/A

30. 2022 HOT N HECTIC

Kentucky - Bred

Year of Birth: 2022

Stallion: cupid

Dam: hot n hectic

Type: Weanling

In Foal: N/A

31. 2022 OUT OF DANGER

Kentucky - Bred

Year of Birth: 2022

Stallion: catalina cruiser

Dam: out of danger

Type: Weanling

In Foal: N/A

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32. 2022 PLEDGE MOM

Kentucky - Bred

Year of Birth: 2022

Stallion: enticed

Dam: pledge mom

Type: Weanling

In Foal: N/A

33. 2022 SARA SARA

Kentucky - Bred

Year of Birth: 2022

Stallion: wicked strong

Dam: sara sara

Type: Weanling

In Foal: N/A

34. 2022 AGENT ROMANOFF

Kentucky - Bred

Year of Birth: 2022

Stallion: Tapiture

Dam: Agent Romanoff

Type: Weanling

In Foal: N/A

35. UP FOR GRABS

Kentucky - Bred

Year of Birth: 2022

Stallion: st patricks day

Dam: up for grabs

Type: Weanling

In Foal: N/A

36. 2021 SAUDIA

Kentucky - Bred

Year of Birth: 2021

Stallion: karakonte

Dam: saudia

Type: Yearling

In Foal: N/A

37. 2021 CASTELLANI

Kentucky - Bred

Year of Birth: 2021

Stallion: kittens joy

Dam: castellani

Type: Yearling

In Foal: N/A

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38. 2021 QUITE A NIGHTMARE

Kentucky - Bred

Year of Birth: 2021

Stallion: midshipman

Dam: Quite A nightmare

Type: Yearling

In Foal: N/A

39. 2021 PRECOCIOUS MISS

Kentucky - Bred

Year of Birth: 2021

Stallion: Yoshida

Dam: Precocious Miss

Type: Yearling

In Foal: N/A

40. 2021 ROSY SCENARIO

Kentucky - Bred

Year of Birth: 2021

Stallion: connect

Dam: rosy scenario

Type: Yearling

In Foal: N/A

41. 2021 DREAMING AS ALWAYS

Kentucky - Bred

Year of Birth: 2021

Stallion: Oscar performance

Dam: Dreaming asAlways

Type: Yearling

In Foal: N/A

42. 2021 SCHMISS

Kentucky - Bred

Year of Birth: 2021

Stallion: cupid

Dam: schmiss

Type: Yearling

In Foal: N/A

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43. 2021 BLUE WHALE

Kentucky - Bred

Year of Birth: 2021

Stallion: Fusaichi Pegasus

Dam: Blue Whale

Type: Yearling

In Foal: N/A

44. 2021 MY NAME IS DRAGON

Kentucky - Bred

Year of Birth: 2021

Stallion: Sky Mesa

Dam: angry dragon

Type: Yearling

In Foal: N/A

45. 2021 RED BARONESS

Kentucky - Bred

Year of Birth: 2021

Stallion: Sky Mesa

Dam: Red Baroness

Type: Yearling

In Foal: N/A

46. 2021 ISTAN AGAIN

Kentucky - Bred

Year of Birth: 2021

Stallion: Upstart

Dam: Istan Again

Type: Yearling

In Foal: N/A

47. BROOKLYNS FINEST

Kentucky - Bred

Year of Birth: 2020

Stallion: west coast

Dam: Sweet Offer

Type: Two Year Old

In Foal: N/A

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48. XTRASAUCEWELLDONE

Kentucky - Bred

Year of Birth: 2020

Stallion: Competitive Edge

Dam: Longstocking

Type: Two Year Old

In Foal: N/A

49. DRAGONS BACK

Kentucky - Bred

Year of Birth: 2020

Stallion: Buchero

Dam: Angry Dragon

Type: Two Year Old

In Foal: N/A

50. RAZZALIUNA

Kentucky - Bred

Year of Birth: 2020

Stallion: Tapizar

Dam: Celtic Moonlight

Type: Two Year Old

In Foal: N/A

51. RACEDAY FILLY 2020

Kentucky - Bred

Year of Birth: 2020

Stallion: Raceday

Dam: Time for harlan

Type: Two Year Old

In Foal: N/A

52. CALIFORNIA GIGI

Kentucky - Bred

Year of Birth: 2019

Stallion: California Chrome

Dam: Killer Bird

Type: Three Year Old

In Foal: N/A

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53. IMOTO

Kentucky - Bred

Year of Birth: 2019

Stallion: Handsome Mike

Dam: Red Baroness

Type: Three Year Old

In Foal: N/A

54. MADELYNS HEAT

Kentucky - Bred

Year of Birth: 2019

Stallion:Cairo Prince

Dam: Miracle Heat

Type: Three Year Old

In Foal: N/A

55. MOUNT RUNDLE

Kentucky - Bred

Year of Birth: 2019

Stallion:Jack Milton

Dam: Beaucoup

Type: Three Year Old

In Foal: N/A

56. ROUGHLY A DIAMOND

Kentucky - Bred

Year of Birth: 2019

Stallion: First Samurai

Dam: Leonor Fini

Type: Three Year Old

In Foal: N/A

57. SUEGAAR

Kentucky - Bred

Year of Birth: 2019

Stallion: Handsome Mike

Dam: angry dragon

Type: Three Year Old

In Foal: N/A

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58.VOLAIZE

Kentucky - Bred

Year of Birth: 2019

Stallion: Malibu Moon

Dam: My Mammy

Type: Three Year Old

In Foal: N/A

59. ALWAYS ABOVE

Kentucky - Bred

Year of Birth: 2018

Stallion: Honor Code

Dam: Castilla

Type: Four Year Old

In Foal: N/A

60. BONHEUR

Kentucky - Bred

Year of Birth: 2018

Stallion: Munnings

Dam: Annatlantic

Type: Four Year Old

In Foal: N/A

61. MY MAN FLINT

Kentucky - Bred

Year of Birth: 2018

Stallion: flintshire

Dam: Everdeen

Type: Four Year Old

In Foal: N/A

62.TORETTO

Kentucky - Bred

Year of Birth: 2018

Stallion: Handsome Mike

Dam: angry dragon

Type: Four Year Old

In Foal: N/A

63. AIZU

Florida - Bred

Year of Birth: 2017

Stallion: Japan

Dam: Red Baroness

Type: Five Year Old

In Foal: N/A

64. SAVING SOPHIE

Kentucky - Bred

Year of Birth: 2016

Stallion: Creative Cause

Dam: Pelt

Type: Four Year Old

In Foal: N/A

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The average costs for maintaining a horse in training (Note: costs may vary significantly from horse to horse): (i) Trainer - $85 - $100 per day; (ii) Veterinarian - $350 per month; (iv) Blacksmith - $180 per day; (v) Transportation - $100 per month. On average, each horse managed by the Company will cost about $45,000 per year to maintain.

Competition

We believe that our main competitors in the thoroughbred racing business include, but are not limited to, Stonestreet Farms, WinStar Farms and Calumet Farm, each of which owns many stallion shares, broodmares and also races. Many of our competitors are better capitalized than we are. In particular, we may have insufficient funds to meet our operating expenses. As a result of the foregoing or for other reasons, we may be required to sell one or more of our horses prior to the time of our anticipated liquidation in order to fund our cash needs.

The trend towards the acceptance of partnerships as opposed to individual or farm owners is positive with the Company as a leader. Owning horses is expensive and the competition for prize money via purses is strong. Pooling resources has proven to be a viable method for individuals to compete in the current marketplace. The Company is entering a crowded market, however, the vast majority of available partnerships are redundant, often lacking professional management or goals. Redundancy is a common theme, as very little is typically offered to investors outside of a small percentage of ownership in individual horses. By contrast, the Company offers its investors the opportunity to own the entire business, which includes the success of the syndicated horses.

Horse racing also competes against all other forms of entertainment such as professional football, baseball, hockey, soccer, basketball, other gaming, and outdoor activities. According to an IBISWorld Industry Report (Horse Racing Tracks), these indirect competitors may pull much of the available time and money from this sport. Additionally, the horse racing industry is subject to competition from other gambling activities, including electronic gaming, sports betting and arbitrage betting. While thoroughbred racing in the United States, like many other industries, slumped following the economic downturn of 2008, there have been positive signs of recovery, with betting handle (the amount of money in wagers accepted over a specific period of time) rising in 2015 and the first six months of 2016 after several years of declines. Other forward trending signs include the increase in the number of horses being produced on a year to year basis and prices for unraced horses at auction also going up.

Government Regulation

The racing future of and/or market for the horses in which the Company has an interest depends upon continuing governmental acceptance of horse racing as a form of legalized gambling. Although horse racing has a long history of acceptance in the United States and as a source of revenue, at any time, horse racing could be subjected to restrictive regulation or banned entirely. The value of the interest in the underlying asset would be substantially diminished by any such regulation or ban. Horse racing is regulated in various states and foreign countries by racing regulatory bodies which oversee the conduct of racing as well as the licensing of owners, trainers and others. Further, other forms of gambling are being approved throughout the United States and therefore no assurance can be provided that the legalization of other forms of gambling and competition from non-gambling sports and other activities will not adversely affect attendance and participation, and therefore the profitability of horse racing and sales. Lastly, our ownership structure is novel and may prepare us to seek regulatory approval to race in certain jurisdictions.

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Legal Proceedings

Other than as set forth below, we are not presently a party to, and none of our property is the subject of, any pending legal proceedings. To our knowledge, no governmental authority is contemplating any such proceedings.

The Company and our Principal Executive Officer, Troy Levy (the “Respondents”), entered into a Stipulation for Consent Order, Case No. 2019 CDS-035, on November 27, 2019 (the “Order”) in lieu of a hearing, following receipt of a subpoena duces tecum from the Colorado Division of Securities. The Order recited that the Commissioner had reviewed allegations of the staff of the Securities Commissioner of Colorado which had alleged unregistered securities of the Company were sold by Respondents in the State of Colorado in violation of Section 11-51-301 of the C.R.S. which securities had not been determined to be exempt from registration requirements. As had been agreed by Respondents, the Order, in summary, required the Respondents to rescind a securities purchase transaction with a Colorado resident through payment in the amount of $6,049 for the Colorado investor’s securities, to not take any action or make a public statement denying or creating the impression that the Order lacked a factual basis, and to comply with the Colorado Securities Act with regard to all future offers and sales of securities covered by the Colorado Securities Act.

Employees

As of the date of this Offering Circular, we have three (8) full-time employees and three (3) part-time employees. We do not currently have any pension, health, annuity, insurance, or similar employee benefit plans, although we may choose to adopt such plans in the future. Each of our executive officers and directors are eligible to receive equity compensation at the discretion of our Board pursuant to the 2020 Equity Incentive Plan. See “Securities Being Offered—Equity Inventive Plan.”

We plan to engage contractors from time to time on an as-needed basis to consult with us on specific corporate affairs, or to perform specific tasks in connection with our business development activities.

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DESCRIPTION OF PROPERTY

The Company operates its horseracing ownership business out of the State of Florida and the State of Kentucky. The Company’s head office is located at 1740 Grassy Springs Road, Versailles, Kentucky 40383.

Florida Thoroughbred Racing Operations – Gulfstream Park Access

The Company’s horses race at the racetrack located at Gulfstream, a multi-dimensional facility with restaurants, stores, sports bars, a bowling alley, a casino and poker room to go along with the racetrack. Two of the restaurants, Christine Lees and Ten Palms, allow one to dine while watching her horses compete on the racetrack. The Company’s club members have access to discounts at the various restaurants at Gulfstream and the surrounding South Florida area, in addition to reduced rates at the Company’s partner hotels and businesses.

 

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Kentucky Operations – Circle 8 Ranch

The Company’s horses are housed and trained at the Circle 8 ranch, a state-of-the-art facility located 15 minutes from Lexington, Kentucky. The Company previously operated the Circle 8 ranch pursuant to a Lease and Purchase Option Agreement (the “Lease and Purchase Option Agreement”), entered into on March 15, 2019 with Grassy Springs Farm, LLC, whereby the Company agreed to lease 200 acres of agricultural land located at 1740 Grassy Springs Road, Versailles, Kentucky 40383. The Company executed its purchase option on February 9, 2022 and paid cash for the remaining obligation of the lease for $2,955,125. The land includes several structures, including a farm house, out buildings, and a main barn with 23 stalls, tack rooms, wash stalls and lab area, in addition to executive offices. The residence on the land is 2,450 square feet of newly renovated living space. Our buildings include an equipment barn, shop, and farm implement storage. The land also includes 14 plank fenced paddocks, 6 large fields, a 5/8-mile grass training track, and a pond situated on more than one acre.

 

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

You should read the following discussion and analysis of our financial condition and results of our operations together with our financial statements and the notes thereto appearing elsewhere in this Offering Circular. This discussion contains forward-looking statements reflecting our current expectations, whose actual outcomes involve risks and uncertainties. Actual results and the timing of events may differ materially from those stated in or implied by these forward-looking statements due to a number of factors, including those discussed in the sections entitled “Risk Factors,” “Cautionary Statement Regarding Forward-Looking Statements,” and elsewhere in this Offering Circular. Please see the notes to our Financial Statements for information about our Significant Accounting Policies.

Overview

The Company was incorporated on March 31, 2017 in the State of Florida and was authorized to do business in the State of Kentucky on February 19, 2019. The Company’s principal office is located at 1740 Grassy Springs Road, Versailles, Kentucky 40383. The Company is a thoroughbred horse racing company, operating its business primarily through three functions: (i) horse ownership syndication; (ii) horse training, breeding and horse racing; and (iii) pinhooking.

Results of Operations

For the Year Ended December 31, 2020 and the Year Ended December 31, 2019

Revenues

Our revenue was $ 316,949 for the year ended December 31, 2020, as compared to $90,167 for the year ended December 31, 2019. Our revenues increased during this period, due to increased purse winnings and syndication fees. The ranch was established early 2019 and allowed for more training of the horses resulting in better showings at the racetracks. In addition, more horses were purchased during this period resulting in more syndication activities.

Net Loss

Our net loss was $1,641,186 for the year ended December 31, 2020, as compared to $1,635,867 for year ended December 31, 2019. The slight increase in net loss was due to the increased investment in operations to establish the ranch. The purchases of horses and its related expenses to train and maintain them resulted in higher overall costs compared to the revenue generated for the year.

Horse and Ranch Expenses

Our horse and ranch expenses were $1,016,278 for the year ended December 31, 2020, as compared to $749,352 for year ended December 31, 2019. The increase in expenses was mainly due to the increased training and maintenance costs including feed and transportation of the additional horses that were purchased throughout the year. Ranch and horse expenses consisted primarily of training, veterinary, transportation, ranch improvements, and barn expenses.

General and Administrative Expenses

Our general and administrative expenses were $845,595 for the year ended December 31, 2020, as compared to $806,981 for year ended December 31, 2019. General and administrative expenses consisted primarily of personnel, marketing, consulting and professional fees, vehicle, office, and travel expenses. The increase in operational activities were due to the purchase of more horses and the filing of the SEC application resulted in increased audit and legal fees.

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For the Six Month Period from January 2020 to June 2020 Compared to the Six Months Ending January 2021 to June 2021.

Revenues

Our revenue was $133,416 for the six months ended June 30, 2021, as compared to $103,480 for the six months ended June 30, 2020. Our revenues increased slightly during this period, due to increased purse winnings and syndication fees. The ranch was established early 2019 and allowed for more training of the horses resulting in better showings at the racetracks. In addition, more horses were purchased during the period ended June 30, 2021 resulting in more syndication activities.

Net Loss

Our net loss was $1,712,772 for the six months ended June 30, 2021, as compared to $530,632 for the six months ended June 30, 2020. The increase in net loss was due to the increased investment in operations to establish the ranch. Our purchases of horses and our related expenses to train and maintain them resulted in higher overall costs compared to the revenue generated for the year.

Horse and Ranch Expenses

Our horse and ranch expenses were $767,408 for the six months ended June 30, 2021, as compared to $425,693 for six months ended June 30, 2020. The increase in expenses was mainly due to the increased training and maintenance costs including feed and transportation of the additional horses that were purchased throughout the year. Ranch and horse expenses consisted primarily of training, veterinary, transportation, ranch improvements, and barn expenses.

General and Administrative Expenses

Our general and administrative expenses were $870,547 for the six months ended June 30, 2021, as compared to $ 271,680 for six months ended June 30, 2020. General and administrative expenses consisted primarily of salaries/benefits, marketing, consulting and professional fees, vehicle, office, and travel expenses. The increase in operational activities were due to the purchase of more horses and the filing of the Form 1-A offering statement for our Regulation A, Tier 2 offering of units (the “Offering”) resulting in increased audit and legal fees.

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Liquidity and Capital Resources

To date, we have generated some cash through purse winnings and syndication of horses, however the Company still has negative cash flows from operating activities. All costs in connection with horse acquisitions, operating expenses and professional fees have been funded mainly by our shareholders, including our founder, President and Chief Executive Officer Troy Levy.

Our future expenditures and capital requirements will depend on numerous factors, including the success of this Offering, funds received from our recent Regulation Crowdfunding campaign and the progress and ability to win races by our racehorses and syndication efforts.

Our business does generate cash through purse winnings from races, syndication fees and the sale of horses. We believe that if we raise $49,980,0000 (the Maximum Amount) in this Offering, we will have sufficient capital to finance our operations for at least the next three (3) years; however, if we do not raise the Maximum Amount or if our operating and development costs are higher than expected, we will need to obtain additional financing prior to that time. We do not have any track record for self-underwritten Regulation A+ offerings, and there can be no assurance we will raise the Maximum Amount or any other amount. Further, we expect that after such nine-month period, we will be required to raise additional funds to finance our operations until such time that we can conduct revenue-generating activities. However, no assurances can be made that we will be successful obtaining additional equity or debt financing, or that ultimately, we will achieve profitable operations and positive cash flow.

Going Concern

Our financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company’s ability to continue as a going concern is contingent upon its ability to raise additional capital as required. During the period from January 2018 to June 2021, the Company incurred combined net losses of $(6,689,540). Initially, we intend to finance our operations through equity and debt financings.

The Company generates some cash from purse winnings and syndication of horses however we have funded operations mainly in the form of expenditures paid for on behalf of the Company by shareholders.

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Credit Facilities

In order to finance certain equipment and vehicles, the Company entered into (i) SBA Loan #64991967906, dated effective as of March 16, 2020, with the Small Business Administration, as the secured lender, and the Company, as the borrower, in the principal amount of $88,400; (ii) SBA Loan #7175647906, dated effective as of June 17, 2020, with the Small Business Administration, as the secured lender, and the Circle 8 Ranch, as the borrower, in the principal amount of $14,000; and (iii) the Paycheck Protection Program Promissory Note and Agreement, dated June 19, 2020, with Wells Fargo, as the secured lender, and the Company, as the borrower, in the principal amount of $6,951. Such equipment and vehicles are secured by the Company’s majority shareholder, Troy Levy.

Capital Expenditures

The Company’s main capital expenditures are the acquisition and purchase of horses for racing and breeding purposes. The amount of purchase will depend on the amount raised through this Offering. In addition, the Company plans to upgrade the ranch operations and purchase additional equipment such as a tractor and other farm equipment.

Off-Balance Sheet Arrangements

During the periods presented, we did not have, and we do not currently have, any off-balance sheet arrangements.

Contractual Obligations, Commitments and Contingencies

The Company followed through on its commitment and purchased Circle 8 ranch on February 9,2022 for the cash price of $2,955,125.

Relaxed Ongoing Reporting Requirements

Regulation A+ provides that a filer can take advantage of an extended transition period for complying with new or revised accounting standards. We have elected to avail ourselves of this exemption and, therefore, we will not be subject to the same adoption period for new or revised accounting standards as public companies.

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Upon the completion of this Offering, we may elect to become a public reporting company under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). If we elect to do so, we will be required to publicly report on an ongoing basis as an “emerging growth company” (as defined in the JOBS Act) under the reporting rules set forth under the Exchange Act. As defined in the JOBS Act, an emerging growth company is defined as a company with less than $1 Billion in revenue during its last fiscal year. An emerging growth company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies.

For so long as we remain an “emerging growth company,” we may take advantage of certain exemptions from various reporting requirements that are applicable to other Exchange Act reporting companies that are not “emerging growth companies,” including but not limited to:

● not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act;

● taking advantage of extensions of time to comply with certain new or revised financial accounting standards;

● being permitted to comply with reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements; and

● being exempt from the requirement to hold a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

If we are required to publicly report under the Exchange Act as an “emerging growth company”, we expect to take advantage of these reporting exemptions until we are no longer an emerging growth company. We would remain an “emerging growth company” for up to five years, though if the market value of our Common Stock that is held by non-affiliates exceeds $700 Million, we would cease to be an “emerging growth company.”

If we elect not to become a public reporting company under the Exchange Act, we will be required to publicly report on an ongoing basis under the reporting rules set forth in Regulation A+ for Tier 2 issuers. The ongoing reporting requirements under Regulation A+ are more relaxed than for “emerging growth companies” under the Exchange Act. The differences include, but are not limited to, being required to file only annual and semi-annual reports, rather than annual and quarterly reports. Annual reports are due within 120 calendar days after the end of the issuer’s fiscal year, and semi-annual reports are due within 90 calendar days after the end of the first six months of the issuer’s fiscal year.

Plan of Operations

As noted above, the continuation of our current plan of operations requires us to raise significant additional capital. If we are successful in raising capital through the sale of Units offered for sale in this Offering Circular, we believe that the Company will have sufficient cash resources to fund its plan of operations for the next three years. If we are unable to do so, we may have to curtail and possibly cease some operations.

We are a horseracing ownership business and began operations in March 2017. Over the past two fiscal years, we have focused primarily on increasing our asset base, including the development of the Grassy Springs farm, rather than revenue generating activities including buying and selling horses. We will attempt to operate the business profitably in the future although management believes the Company will need financing from this offering and potentially additional financing for at least eighteen (18) months before profitable operations could occur. In the future, using the proceeds of the offering, we will be able to focus on building our inventory of horses in order to later generate revenues, both by selling such horses through our syndication process and through thoroughbred racing activities. We initially acquired horses in order to build our inventory. Once our broodmares had their foals, we have been able to increase our inventory of horses in-house. We commenced operations with two (2) broodmares and now own sixteen (16) broodmares. Management believes that these broodmares will generate revenues for the Company through the syndication process and by such horses participating in thoroughbred racing activities. Management also believes that our syndication process, which offers group partnerships where investors can purchase a percentage of one horse or a group of horses, offers its investors a positive and personal ownership experience which will empower such investors to reinvest and expand their ownership positions further. Management can provide no assurances its business model will ever achieve profitable operations.

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Generally, our plan of operations for the next few years includes (i) potentially purchasing a neighboring farm or other ranches; (ii) making capital improvements to the Circle 8 ranch; (iii) acquiring racehorses for breeding, racing purposes and pinhooking; (iv) paying stud fees for purposes of horse breeding; (v) investing in stallion shares, which provides us with the ability to breed such popular stallions for life and participate in profits; (vi) purchasing ranch equipment, such as a tractor and Eurosizer; (vii) upgrading our barn operations; (viii) increasing our branding and marketing efforts; (ix) making office systems upgrades; and (x) paying increased operational horse and ranch expenses. We would require funds through this offering to meet these objectives.

We continually evaluate our plan of operations to determine the manner in which we can most effectively utilize our limited cash resources. The timing of completion of any aspect of our plan of operations is highly dependent upon the availability of cash to implement that aspect of the plan and other factors beyond our control. There is no assurance that we will successfully obtain the required capital or revenues, or, if obtained, that the amounts will be sufficient to fund our ongoing operations.

These circumstances raise substantial doubt on our ability to continue as a going concern. Our financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might result from this uncertainty.

Trend Information

Because we only began operations in 2017 and have a limited operating history, we are unable to identify any significant recent trends in revenue or expenses, production, sales and inventory, and we are unable to identify any known trends, uncertainties, demands, commitments or events involving our business that are reasonably likely to have a material effect on our revenues, income from operations, profitability, liquidity or capital resources, or that would cause the reported financial information in this Offering Circular to not be indicative of future operating results or financial condition.

In light of the recent COVID-19 pandemic, there could possibly be an impact on our business. Additionally, COVID-19 has caused significant disruptions to the global financial markets, which could impact our ability to raise additional capital. The ultimate impact on us and our business is unknown, but our operations and financial condition could suffer in the event of any of these types of unpredictable events. Further, any significant uninsured liability may require us to pay substantial amounts, which would adversely affect our business, results of operations, financial condition and cash flows. Currently, our operations remain materially unaffected by the sudden outbreak of COVID-19.

The Company plan to adhere to all Center of Disease Control guidelines and will test, operate in a socially distant manner and limit large gatherings. Most of our operations and activities are outdoors and therefore pose lesser risk of contracting the virus.

DIRECTORS, EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES

As of the date of this Offering Circular, our directors, executive officers and significant employees are as follows:

Name	Position	Age	Term of Office	Approximate hours per week for part-time employees or consultants
Executive Officers:
Troy Levy	President	54	March 2017– Present	N/A
Sunny Sharma	Interim Chief Financial Officer	50	August 2020 – Present	15
Directors:
Troy Levy	Chairman of the Board	54	March 2017– Present	N/A
Ronald Kapphahn	Director	66	2019 – Present	N/A

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Certain Relationships

Except as set forth above and in our discussion below in “Interest of Management and Others in Certain Transactions,” none of our directors or executive officers has been involved in any transactions with us or any of our directors, executive officers, affiliates or associates which are required to be disclosed pursuant to the rules and regulations of the SEC.

Business Experience

Troy Levy, President, Chief Executive Officer and Chairman of the Board

Mr. Levy has served as our Chief Executive Officer and President since inception when he founded the Company in March 2017. Prior to Tropical Racing, he founded an obstacle course racing and entertainment company specializing in extreme sporting events. From July 1993 to December 1998, he was engaged in the financial services industry first serving as a Licensed Stockbroker holding Series 7 and 63 licenses and he later served in supervisory positions as a licensed series 24. He has been actively involved in the Thoroughbred horse racing industry for over 30 years. During 2018, Mr. Levy was elected to the non-profit Florida Horsemen’s Benevolent and Protective Association (FHBPA) board, while also serving on the TRAC committee. A dedicated supporter of the Florida Thoroughbred industry. Mr. Levy contributes his time to improve and promote the equine industry through accountability, responsibility, and integrity for the horses and their caretakers.

Sunny Sharma, Interim Chief Financial Officer

Mr. Sharma has served as our financial consultant and interim chief financial officer since August 2020. He has over 20 years of experience in public, private equity and individual investor backed entities in various sectors including education, healthcare, and technology. Mr. Sharma started out his career in public accounting and later held several Executive positions. Mr. Sharma served as the CEO from September 2012 to November 2017 of Digital Media Arts College (DMAC), and in December 2017 he successfully exited with the sale of the College. In addition, from October 2016 to the present, Mr. Sharma has served as the Chief Financial Officer for an early-stage healthcare technology company. He has also served on several non-profit boards including Grandview Preparatory School and Juvenile Diabetes Research Foundation. Mr. Sharma has a Bachelor of Commerce in Accounting from Carleton University in Ottawa, Canada, and a Master of Business Administration from the University of Miami.

Ronald Kapphahn, Director

Mr. Kapphahn has served as our director since 2019. He has been involved in the real estate industry as an investor, developer, and manager for the last 25 years. In addition to being the owner/operator of a large construction company (Ellison Framing) since October 1988, Mr. Kapphahn manages his investments in multiple projects including over 100,000 square feet of commercial rental space, a cattle grazing enterprise, a hunting lodge, a bed & breakfast in Mexico, and other interests. Mr. Kapphahn assisted in the building of a large, assisted living facility connected to a religious organization and is involved in all aspects of building preservation. Mr. Kapphahn brings a unique perspective to the Company particularly respective to management of the horse farm and training facility in Kentucky. 

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Involvement in Certain Legal Proceedings

To our knowledge, none of our current directors or executive officers has, during the past ten years:

• been convicted in a criminal proceeding or been subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);

• had any bankruptcy petition filed by or against the business or property of the person, or of any partnership, corporation or business association of which he or she was a general partner or executive officer, either at the time of the bankruptcy filing or within two years prior to that time;

• been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction or federal or state authority, permanently or temporarily enjoining, barring, suspending or otherwise limiting, his involvement in any type of business, securities, futures, commodities, investment, banking, savings and loan, or insurance activities, or to be associated with persons engaged in any such activity;

• been found by a court of competent jurisdiction in a civil action or by the SEC or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated;

• been the subject of, or a party to, any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated (not including any settlement of a civil proceeding among private litigants), relating to an alleged violation of any federal or state securities or commodities law or regulation, any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order, or any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or

• been the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

The Company and our Principal Executive Officer, Troy Levy (the “Respondents”), entered into a Stipulation for Consent Order, Case No. 2019 CDS-035, on November 27, 2019 (the “Order”) in lieu of a hearing, following receipt of a subpoena duces tecum from the Colorado Division of Securities. The Order recited that the Commissioner had reviewed allegations of the staff of the Securities Commissioner of Colorado which had alleged unregistered securities of the Company were sold by Respondents in the State of Colorado in violation of Section 11-51-301 of the C.R.S. which securities had not been determined to be exempt from registration requirements. As had been agreed by Respondents, the Order, in summary, required the Respondents to rescind a securities purchase transaction with a Colorado resident through payment in the amount of $6,049 for the Colorado investor’s securities, to not take any action or make a public statement denying or creating the impression that the Order lacked a factual basis, and to comply with the Colorado Securities Act with regard to all future offers and sales of securities covered by the Colorado Securities Act.

Other than the aforementioned, we are not currently a party to any legal proceedings, the adverse outcome of which, individually or in the aggregate, we believe will have a material adverse effect on our business, financial condition or operating results.

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COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS

Statement of Executive Compensation

For the purposes of this Offering Circular, a “Named Executive Officer”, or “NEO”, means each of the following individuals:

(a)	each individual who, during any part of the Company’s financial year ended December 31, 2021, served as chief executive officer (“CEO”) of the Company, including an individual performing functions similar to a CEO;
(b)	each individual who, during any part of the Company’s financial year ended December 31, 2021, served as chief financial officer (“CFO”) of the Company, including an individual performing function similar to a CFO;
(c)	the most highly compensated executive officers of the Company and its subsidiaries, other than the individuals identified in paragraphs (a) and (b), as at December 31, 2020 whose total compensation was more than $150,000, as determined in accordance with subsection 1.3(5) of Form 51‑102F6, for the financial year ended December 31, 2021; and
(d)	each individual who would be a NEO under paragraph (c) above but for the fact that the individual was not an executive officer of the Company, and was not acting in a similar capacity, as at December 31, 2021.

Based on the foregoing definitions, the Company has 1 Named Executive Officer(s): Troy Levy, the Company’s President. The summary compensation table below provides information for the two most recently completed financial years ended December 31, 2021 regarding compensation paid to or earned by each of the Named Executive Officer(s).

Director and Named Executive Officer Compensation, Excluding Compensation Securities

The following table represents information regarding the total compensation for the three (3) highest paid directors and the executive officers of the Company as of December 31, 2021:

Name and Capacity in which Compensation was Received	Cash Compensation		Other Compensation		Total Compensation
	($)		($)		($)
Troy Levy, Chief Executive Officer, President and Director(1)	$	35,000.00	$	-	$	35,000.00
Ronald Kapphahn, Director(2)		--		--		--
Sunny Sharma, Interim Chief Financial Officer		27,250.00		--		27,250.00

__________ 

(1)	Mr. Levy provides his services through the Levy Employment Agreement. See below “Employment Agreements, Arrangements or Plans”.
(2).	Mr. Kapphahn has not received compensation for his services as director.

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Stock Options and Other Compensation Securities

During the fiscal year ended December 31, 2021, none of the Named Executive Officers and directors of the Company or any of its subsidiaries received stock options or other compensation securities for services provided or to be provided, directly or indirectly, to the Company or any of its subsidiaries.

Director Compensation

We have two (2) directors. We currently do not pay our directors any cash compensation for their services as board members.

Employment Agreements, Arrangements or Plans

Except as disclosed herein, there were no agreements or arrangements under which compensation was provided during the most recently completed financial year or is payable in respect of services provided to the Company or any of its subsidiaries that were: (a) performed by a director or named executive officer; or (b) performed by any other party but are services typically provided by a director or a named executive officer.

On February 22, 2022, the Company entered into an amended and restated executive employment agreement with Troy Levy (the “Amended and Restated Levy Employment Agreement”). The terms of the Amended and Restated Levy Employment Agreement provide for an initial base salary of $260,000 per calendar year, with the opportunity for a cash bonus, at the sole discretion of the Board. The Amended and Restated Levy Employment Agreement also provides for automobile allowance for lease or purchase of an automobile, including insurance, parking, taxes, fuel, and any other automobile-related expenses, of $1800 per month.  This allowance may be increased by the Board but may not be reduced unless there is across-the-board salary and/or expense reduction for other employees of the Company. Additionally, the Amended and Restated Levy Employment Agreement provides that in the event of a change in control, pursuant to which there is a change in the majority ownership of the Company or a change in the effective control of the Company, or a change in the ownership of a substantial portion of the Company’s assets, the Company shall pay Mr. Levy a bonus equal to 104 weeks’ Base Salary within thirty (30) days of the change in control, provided Mr. Levy is not terminated with Cause and does not resign prior to date the bonus is scheduled to be paid.

The Company entered into an Engagement Agreement with Sunny Sharma (the “Engagement Agreement”). Pursuant to the Engagement Agreement, Mr. Sharma serves as part-time Interim Chief Financial Officer of the Company, and the Company will pay Mr. Sharma for those services at a rate of $100 per hour. The engagement centers around, but is not limited to, working to complete the Offering, improving the Company’s system of financial reporting, developing and implementing systems to project and monitor cash flow, and providing detailed analysis of revenue stream growth opportunities, all with the objective of improving operational practices, profitability and cash flows.

52

SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN SECURITYHOLDERS

The following table shows the beneficial ownership of our capital stock as of the date of this Offering Circular held by (i) each person known to us to be the beneficial owner of more than 10% of any class of our shares; and (ii) all directors and executive officers as a group. As of the date of this Offering Circular, (i) 51,523,404 shares of our Class A Common Stock are issued and outstanding, (ii) 10,000,000 shares of our Class B Common Stock are issued and outstanding, and (iii) 0 shares of our Preferred Stock are issued and outstanding. Up to 5,500,000 shares of Class A Common Stock have been reserved for issuance under our 2020 Equity Incentive Plan, of which no shares of our Class A Common Stock are currently issuable. We have no outstanding grants currently under the 2020 Equity Incentive Plan.

Beneficial ownership is determined in accordance with the rules of the SEC, and generally includes voting power and/or investment power with respect to the securities held. Shares of our Class A Common Stock subject to convertible securities, options, warrants and other rights which are currently exercisable or which may become exercisable within 60 days of the date of this Offering Circular, are deemed outstanding and beneficially owned by the person holding such convertible securities, options, warrants or other rights for purposes of computing the number of shares and percentage beneficially owned by such person, but are not deemed outstanding for purposes of computing the percentage beneficially owned by any other person. Except as indicated in the footnotes to this table, the persons or entities named have sole voting and investment power with respect to all shares of Class A Common Stock and Class B Common Stock shown as beneficially owned by them.

The percentages below are based on fully diluted shares of our Class A Common Stock and Class B Common Stock as of the date of this Offering Circular. Unless otherwise indicated, the business address of each person listed is c/o Tropical Racing, Inc., 1740 Grassy Springs Road, Versailles, Kentucky 40383.

Name and Address of Beneficial Owner	Amount and Nature of Beneficial Ownership		Amount and Nature of Beneficial Ownership Acquirable		Percent of Class (1)
Directors and Officers:
Troy Levy(2)		48,957,143		0		79.57	%
Ronald Kapphahn		2,300,000		0		3.72	%
All executive officers and directors as a group		51,257,143		0		83.29	%
Greater than 10% Securityholders:
Troy Levy(2)		48,957,143		0		79.57	%

(1)	This Offering Circular does not contemplate that any of our current listed shareholders will acquire any additional shares of our Class A common stock as part of this Offering.
(2)	Includes Mr. Levy’s ownership of 38,957,143 shares of Class A common stock and his ownership of 10,000,000 shares of Class B common stock.

53

INTEREST OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS

Transactions with Related Persons

Except as described below and except for employment arrangements which are described under “Compensation of Directors and Executive Officers” above, since December 31, 2020, there has not been, nor is there currently proposed, any transaction in which (i) the Company is or was a participant, (ii) the amount involved exceeds the lesser of $120,000 or 1% of the average of the Company’s total assets at year-end for the last two completed fiscal years, and (iii) any of our directors, executive officers, holders of more than 10% of our Common Stock, or any immediate family member of any of the foregoing, had or will have a direct or indirect material interest.

We intend to enter into indemnification agreements with each of our directors and executive officers. In general, these indemnification agreements require the Company to indemnify a director to the fullest extent permitted by law against liabilities that may arise by reason of his or her service for the Company.

The Company engages Michelle Nihei Racing Stables LLC (“Nihei Stables”) to provide training services. Ms. Nihei is the spouse of Troy Levy, the Company’s President. The Company incurred expenses of $283,437 to Nihei Stables for the year ended December 31, 2020.

In order to finance certain equipment and vehicles, the Company entered into (i) SBA Loan #64991967906, dated effective as of March 16, 2020, with the Small Business Administration, as the secured lender, and the Company, as the borrower, in the principal amount of $88,400; (ii) SBA Loan #7175647906, dated effective as of June 17, 2020, with the Small Business Administration, as the secured lender, and the Circle 8 Ranch, as the borrower, in the principal amount of $14,000; and (iii) the Paycheck Protection Program Promissory Note and Agreement, dated June 19, 2020, with Wells Fargo, as the secured lender, and the Company, as the borrower, in the principal amount of $6,951. Such equipment and vehicles are secured by the Company’s majority shareholder, Troy Levy.

At December 31, 2019 and 2020, the Company owed $212,518 and $358,070, respectively, to the Company’s President, Troy Levy, which represent unpaid salary.

Indebtedness of Directors and Executive Officers

At any time during the Company’s last completed financial year, no director, executive officer, employee, proposed management nominee for election as a director of the Company nor any associate of any such director, executive officer, or proposed management nominee of the Company or any former director, executive officer or employee of the Company or any of its subsidiaries is or has been indebted to the Company or any of its subsidiaries or is or has been indebted to another entity where such indebtedness is or has been the subject of a guarantee, support agreement, letter of credit or other similar arrangement or understanding provided by the Company or any of its subsidiaries, other than routine indebtedness.

Interest of Informed Persons in Material Transactions

Other than as set forth herein and other than transactions carried out in the ordinary course of business of the Company or any of its subsidiaries, none of the directors or executive officers of the Company, a director or executive officer of a person or company that is itself an informed person or subsidiary of the Company, nor any shareholder beneficially owning, directly or indirectly, Class A common shares of the Company, or exercising control or direction over Class A Common Stock of the Company, or a combination of both, carrying more than 10% of the voting rights attached to the outstanding Class A Common Stock of the Company nor an associate or affiliate of any of the foregoing persons has since the commencement of the Company’s most recently completed financial year any material interest, direct or indirect, in any transactions which materially affected or would materially affect the Company or any of its subsidiaries.

Review, Approval and Ratification of Related Party Transactions

Given our small size and limited financial resources, we have not adopted formal policies and procedures for the review, approval or ratification of transactions, such as those described above, with our executive officers, directors and significant stockholders. We intend to establish formal policies and procedures in the future, once we have sufficient resources and have appointed additional directors, so that such transactions will be subject to the review, approval or ratification of our Board, or an appropriate committee thereof. On a moving forward basis, our directors will continue to approve any related party transactions. The Board has not yet established an Audit Committee, Compensation Committee or a Nominating Committee, or any committee performing a similar function.

54

SECURITIES BEING OFFERED

The following is a summary of the rights of our capital stock as provided in our Articles of Incorporation and Bylaws. For more detailed information, please see our Articles of Incorporation and Bylaws which have been filed as exhibits to the Offering Statement of which this Offering Circular is a part.

General

Pursuant to the Company’s Amended and Restated Articles of Incorporation (the “Articles of Incorporation”), dated January 10, 2020, the Company is authorized to issue Two Hundred Fifty Million (250,000,000) shares which consist of the following: (i) Two Hundred Million (200,000,000) shares of Class A Common Stock; (ii) Twenty-Five Million (25,000,000) shares of Class B Common Stock; and (iii) Twenty-Five Million (25,000,000) shares of Preferred Stock.

(a)	Common Stock – The holders of the Class A Common Stock are entitled to one vote for each share held by them of record on the books of the Company. The holders of the Class B Common Stock are entitled to ten votes for each share held by them of record on the books of the Company. Such shares of Common Stock may be issued by the Company from time to time for such consideration greater than or equal to par value as may be fixed from time to time by the Board.
(b)	Preferred Stock – The authorized Preferred Stock of the Company is Twenty-Five Million (25,000,000) shares of Preferred Stock with a par value of $.0001 per share. Subject to the terms and provisions of the Articles, the Board is authorized to provide, from time to time, for the issuance of shares of Preferred Stock in series and to fix from time to time before issuance the designation, preferences, privileges and voting powers of the share of each series Preferred Stock and the restrictions of qualifications thereof, including, without limiting the generality of the foregoing, the following: (1) the voting rights, if any, of the holders; (2) the terms and conditions, if any, on which shares may be converted at the election of holders thereof into shares of Common Stock of the Company.
(c)	The capital stock, after the amount of the subscription price or par value has been pain in, shall not be subject to assessment to pay the debts of the corporation.

As of the date of this Offering Circular, (i) 51,523,404 shares of our Class A Common Stock are issued and outstanding, (ii) 10,000,000 shares of our Class B Common Stock are issued and outstanding, and (iii) 0 shares of our Preferred Stock are issued and outstanding. Up to 5,500,000 shares of Class A Common Stock have been reserved for issuance under our 2020 Equity Incentive Plan, of which no shares of our Class A Common Stock are currently issuable. We have no outstanding grants currently under the 2020 Equity Incentive Plan.

Share Purchase Warrants and Rights

As of the date of this Offering Circular, 250,000 warrants to purchase shares of Class A Common Stock are outstanding. The Company may issue share purchase warrants and rights upon such terms and conditions as Board determine, which share purchase warrants and rights may be issued alone or in conjunction with debentures, debenture stock, bonds, shares or any other securities issued or created by the Company from time to time.

Units Consisting of Class A Common Shares and Warrants

In this Offering, the Company is offering up to 5,880,000 Units, each Unit consisting of one Class A Share and one Class A Common Share purchase warrant (each whole warrant, a “Warrant” and collectively, the “Warrants”) to purchase one additional Class A Share (a “Warrant Share”) pursuant to the terms and conditions set forth in the form of Subscription Agreement included as Exhibit 4.1 hereto (the “Subscription Agreement”). The Units are being offered at a price of $3.50 per Unit. One Warrant is required to purchase one additional Warrant Share at an exercise price of $5.00 per Warrant, subject to certain adjustments. The Warrants are exercisable immediately and terminating on the date that is the eighteen (18) month anniversary of the issuance of the Warrant. The Subscription Agreement is to be construed in accordance with and governed by the laws of the State of Florida, and the parties to the Subscription Agreement will consent and submit to the non-exclusive jurisdiction of the federal and state courts.

55

Equity Incentive Plan

Compensation of Directors and Executive Officers

Each of the executive officers and directors listed above is eligible to receive equity compensation at the discretion of our Board.

Upon completion of this Offering, our executive officers and directors will be eligible to receive equity awards under our equity incentive plans at any time at the discretion of our Board.

2020 Plan

We adopted the 2020 Equity Incentive Plan (the “Plan”) on December 28, 2020. The Plan provides for the grant of incentive stock options, non-qualified stock options, restricted stock and restricted stock units. Class A Shares issued under the Plan will be shares of our Class A common stock. Incentive stock options may be granted only to our employees and employees of any parent or subsidiary corporation, and no more than 3,500,000 Class A Shares may be granted as incentive stock options. All other awards may be granted to our employees, directors or consultants and to employees, directors or consultants of any affiliated entity.

Share Reserve

We have reserved 5,500,000 Class A Shares for issuance pursuant to awards under the Plan. In general, shares subject to awards granted under the Plan that are not issued or that are returned to us, for example, because the award is forfeited, the shares are retained by us in satisfaction of amounts owed with respect to an award or the shares are surrendered in payment of an exercise or purchase price or tax withholding, will again become available for awards under the Plan.

Administration

Our Board or a committee of our Board will administer the Plan. The administrator has the power to determine when awards will be granted, which employees, directors or consultants will receive awards, the terms of the awards, including the number of shares subject to each award and the vesting schedule of the awards, and to interpret the terms of the Plan and the award agreements. The administrator also has the authority to prescribe the terms and conditions of each award, including, without limitation, the exercise price and medium of payment and vesting provisions.

Stock Options

The Plan allows for the grant of incentive stock options that qualify under Section 422 of the Code and non-qualified stock options. The exercise price of all options granted under the Plan must at least be equal to the fair market value of our common stock on the date of grant. The term of an incentive stock option may not exceed 10 years, and the term of a non-qualified stock option will be determined by the committee of our Board; provided, however, that no non-qualified stock option are exercisable after the expiration of 10 years from the grant. Not more than 3,500,000 shares of our common stock may be issued pursuant to incentive stock options granted under the Plan.

After the continuous service of an option recipient terminates, the recipient’s options may be exercised, but only within such period of time ending on the earlier of (a) the date that is 3 months following the termination of the recipient’s continuous service or (b) the expiration of the term of the option as set forth in the award agreement; provided that, if the termination of the continuous service is by us for cause, all outstanding options (whether or not vested) will immediately terminate and cease to be exercisable. If, after termination, the recipient does not exercise his or her option within the time specified in the Plan or in the award agreement, the option will terminate.

56

Restricted Stock Awards

Each participant granted restricted stock will execute and deliver to an award agreement setting forth the restrictions and other terms and conditions applicable to such restricted stock. If the committee of our Board determines that the restricted stock will be held by us or in escrow rather than delivered to the participant pending the release of the applicable restrictions, the committee of our Board may require the participant to additionally execute and deliver us (A) an escrow agreement satisfactory to the committee of our Board, if applicable, and (B) the appropriate blank stock power with respect to the restricted stock covered by such agreement. Subject to the restrictions set forth in the applicable award agreement, the participant generally will have the rights and privileges of a shareholder as to such restricted stock, including the right to vote such restricted stock and the right to receive dividends.

Restricted Stock Units

The Plan allows for the grant of restricted stock units. The terms and conditions of a grant of restricted stock units will be reflected in an award agreement. No shares of common stock will be issued at the time a restricted stock unit is granted, and we will not be required to set aside funds for the payment of any such award. A participant has no voting rights with respect to any restricted stock units granted.

Terms of Awards

The administrator of the Plan determines the provisions, terms and conditions of each award, including vesting schedules, forfeiture provisions, form of payment (cash, shares, or other consideration) upon settlement of the award, payment contingencies and satisfaction of any performance criteria.

Transferability of Awards

The Plan allows for the transfer of awards under the Plan only (i) by will, (ii) by the laws of descent and distribution and (iii) for awards other than incentive stock options, to the extent and in the manner authorized by the administrator. Only the recipient of an incentive stock option may exercise such award during his or her lifetime.

Certain Adjustments

In the event of certain changes in our capitalization, to prevent enlargement of the benefits or potential benefits available under the Plan, the administrator will make adjustments to one or more of the number of shares that are covered by outstanding awards, the exercise or purchase price of outstanding awards, the numerical share limits contained in the Plan and any other terms that the administrator determines require adjustment.

Changes in Control

The Plan provides that in the event of a corporate transaction, as such term is defined in the Plan, the committee of our Board may accelerate, vest or cause the restrictions to lapse with respect to all or any portion of any award; cancel awards and cause to be paid to the holders of vested awards the value of such awards, if any, as determined by the Committee, in its sole discretion; provide for the issuance of substitute awards or the assumption or replacement of such awards; or provide written notice to participants that for a period of at least 10 days prior to the change in control, such awards will be exercisable, to the extent applicable, as to all shares of our common stock subject thereto and upon the occurrence of the change in control, any awards not so exercised will terminate.

Plan Amendments and Termination

The Plan will automatically terminate 10 years following the date it becomes effective, unless we terminate it sooner. In addition, our Board has the authority to amend, suspend or terminate the Plan, subject to stockholder approval in the event such approval is required by law provided such action does not adversely affect the rights under any outstanding award.

57

Penny Stock Regulation

The SEC has adopted regulations which generally define “penny stock” to be any equity security that has a market price of less than $5.00 per share or an exercise price of less than $5.00 per share. Such securities are subject to rules that impose additional sales practice requirements on broker-dealers who sell them. For transactions covered by these rules, the broker-dealer must make a special suitability determination for the purchaser of such securities and have received the purchaser’s written consent to the transaction prior to the purchase. Additionally, for any transaction involving a penny stock, unless exempt, the rules require the delivery, prior to the transaction, of a disclosure schedule prepared by the SEC relating to the penny stock market. The broker-dealer also must disclose the commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and, if the broker-dealer is the sole market-maker, the broker-dealer must disclose this fact and the broker-dealer’s presumed control over the market. Finally, among other requirements, monthly statements must be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks. As our Common Stock immediately following this Offering may be subject to such penny stock rules, purchasers in this Offering will in all likelihood find it more difficult to sell their Common Stock shares in the secondary market.

Absence of Public Market

The Company is an alternative reporting company under Regulation A+, Tier 2 of the Securities Act. There is no public trading market for the Common Stock of the Company. See “Risk Factors.”

WHERE YOU CAN FIND MORE INFORMATION

We have filed with the SEC a Regulation A+ Offering Statement on Form 1-A under the Securities Act with respect to the Units offered hereby. This Offering Circular, which constitutes a part of the Offering Statement, does not contain all of the information set forth in the Offering Statement or the exhibits and schedules filed therewith. For further information about us and the Units offered hereby, we refer you to the Offering Statement and the exhibits and schedules filed therewith. Statements contained in this Offering Circular regarding the contents of any contract or other document that is filed as an exhibit to the Offering Statement are not necessarily complete, and each such statement is qualified in all respects by reference to the full text of such contract or other document filed as an exhibit to the Offering Statement. We are required to file periodic reports and other information with the SEC pursuant to the Regulation A, Tier 2 rules and regulation under the Securities Act. The SEC also maintains an Internet website that contains reports, proxy statements and other information about issuers, including us, that file electronically with the SEC. The address of this site is www.sec.gov.

58

PART F/S

TABLE OF CONTENTS

Unaudited Consolidated Financial Statements

for the six months ended June 30, 2021

Consolidated balance sheets as of June 30, 2021 and December 31, 2020 (unaudited)	F-4
Consolidated statements of operations for the six months ended June 30, 2021 and 2020 (unaudited)	F-5
Consolidated statements of stockholders’ equity (deficit) for the six months ended June 30, 2021 and 2020 (unaudited)	F-6
Consolidated statements of cash flows for the six months ended June 30, 2021 and 2020 (unaudited)	F-7
Notes to the consolidated financial statements (unaudited)	F-8

Audited Financial Statements

As of and for the periods ended December 31, 2019 and ended December 31, 2020

Independent auditors report	F-19
Consolidated balance sheets	F-21
Consolidated statements of operations	F-22
Consolidated statements of stockholders’ equity (deficit)	F-23
Consolidated statements of cash flows	F-24
Notes to the consolidated financial statements	F-25

F-1

 TROPICAL RACING, INC.

AND SUBSIDIARIES

Interim Consolidated Financial Statements

For the Six Months Ended June 30, 2021 and 2020

F-2

TABLE OF CONTENTS

TROPICAL RACING INC. AND SUBSIDIARIES

	PAGE(S)
CONSOLIDATED:
BALANCE SHEETS (Unaudited)	F-4
STATEMENTS OF OPERATIONS (Unaudited)	F-5
STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Unaudited)	F-6
STATEMENTS OF CASH FLOWS (Unaudited)	F-7
NOTES TO THE FINANCIAL STATEMENTS (Unaudited)	F-8 - F-15

F-3

TROPICAL RACING, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

AS OF JUNE 30, 2021 AND DECEMBER 31, 2020

	June 2021			December 2020
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	803,808		$	166,914
Accounts receivable		85,007			16,209
Prepaid expenses		-			15,000
Total current assets		888,815			198,123
Property and equipment		181,147			206,483
Racehorses		438,030			388,562
Investment in stallion shares		85,000			85,000
Finance lease right-of-use assets		2,879,232			2,895,570
Total assets	$	4,472,224		$	3,773,738
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued liabilities	$	125,420			307,269
Current portion of notes payable		71,945			74,816
Current portion of finance lease liability		2,642,197			94,996
Total current liabilities		2,839,562			477,081
Notes payable		176,512			193,334
Finance lease liability		-			2,644,056
Due to shareholder		427,343			358,070
Total liabilities		3,443,417			3,672,541
Shareholders' Equity
Common stock and paid-in capital		7,718,347			5,077,965
Retained deficit		(6,689,540	)		(4,976,768	)
Total shareholders' equity		1,028,807			101,197
Total liabilities and shareholders' equity	$	4,472,224		$	3,773,738

F-4

TROPICAL RACING, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE SIX MONTHS ENDED JUNE 30, 2021 AND 2020

(unaudited)

	June 2021			June 2020
REVENUES
Purse winnings	$	56,259		$	42,320
Syndication fees		77,157			61,160
Total revenues		133,416			103,480
EXPENSES
Racehorses		657,451			355,266
Professional fees		440,431			120,121
Salaries and benefits		82,228			78,340
Ranch		109,957			70,427
Marketing and promotions		248,242			32,543
Depreciation		130,722			65,679
Interest		61,022			1,129
Travel and entertainment		34,570			13,600
General and administrative		61,412			22,404
Amortization of ROU asset - finance lease		16,338			56,035
Vehicles		3,764			4,672
Total expenses		1,846,137			820,216
Operating loss		(1,712,721	)		(716,736	)
Gain (loss) on sale of racehorses		(9,112	)		179,424
Other income (loss)		9,061			6,680
Loss before income taxes		(1,712,772	)		(530,632	)
Income taxes		-			-
Net loss attributable to Tropical Racing, Inc.		(1,712,772	)		(530,632	)

F-5

TROPICAL RACING, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

FOR THE SIX MONTHS ENDED JUNE 30, 2021 AND June 30, 2020

(unaudited)

					Additional					Total
	Common Stock Outstanding				Paid		Accumulated			Shareholders'
	Shares		Amount		in Capital		Deficit			Equity
Balance at December 31, 2020		48,195,443	$	5,073,146	$	4,819	$	(4,976,768	)	$	101,197
Issuance of common stock under Regulation A offering, net of issuance costs		563,969	$	1,973,893	$	56.40	$	-		$	1,973,949
Issuance of common stock under Regulation CF offering, net of issuance costs		62,856	$	141,426	$	6.29	$	-		$	141,432
Issuance of common stock under Regulation D		-	$	525,000	$	-	$	-		$	525,000
Net Loss		-	$	-	$	-	$	(1,712,772	)	$	(1,712,772	)
Balance at June 30, 2021		48,822,268	$	7,713,465	$	4,882	$	(6,689,540	)	$	1,028,807

	Common Stock Outstanding				Additional Paid		Accumulated			Total Shareholders'
	Shares		Amount		in Capital		Deficit			Equity
Balance at December 31, 2019		43,298,793	$	3,397,407	$	4,330	$	(3,098,528	)	$	303,209
Issuance of common stock under Regulation A offering, net of issuance costs		-	$	-	$	-	$	-		$	-
Issuance of common stock under Regulation CF offering, net of issuance costs		-	$	-	$	-	$	-		$	-
Issuance of common stock under Regulation D		333,985	$	327,995	$	33	$	-		$	328,028
Net Loss		-	$	-	$	-	$	(530,632	)	$	(530,632	)
Balance at June 30, 2020		43,632,778	$	3,725,402	$	4,363	$	(3,629,160	)	$	100,605

F-6

TROPICAL RACING, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 2021 AND 2020

(unaudited)

	June 2021			June 2020
OPERATING ACTIVITIES
Net loss	$	(1,712,772	)	$	(530,632	)
Adjustments to reconcile net loss to net cash used in operations:
Depreciation and amortization		147,060			121,714
Loss (Gain) on disposal		9,112			(179,424	)
Changes in operating assets and liabilities:
Accounts receivable		68,798			(21,464	)
Prepaid expenses		(15,000	)		-
Accounts payable and accrued liabilities		(181,849	)		(14,948	)
Net cash used in operations		(1,684,651	)		(624,754	)
FINANCING ACTIVITIES
Proceeds from issuance of debt		-			157,253
Payments of principal of notes payable		(19,693	)		-
Proceeds from shareholder loans		69,273			97,210
Payments of principal on finance lease liability		(151,000	)		(158,500	)
Issuance of shares		2,640,382			328,028
Net cash provided by financing activities		2,538,962			423,991
INVESTING ACTIVITIES
Purchases of property and equipment		(150,648	)		(118,698	)
Purchases of racehorses		(176,792	)		(95,031	)
Proceeds from sales of racehorses		110,023			450,488
Net cash used in investing activities		(217,417	)		236,759
Net increase in cash and cash equivalents		636,894			35,996
Cash and cash equivalents, beginning of year		166,914			94,901
Cash and cash equivalents, end of year	$	803,808		$	130,897

F-7

TROPICAL RACING, INC. AND SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED JUNE 30, 2021 AND 2020

NOTE 1 - NATURE OF OPERATIONS

Description of Organization and Business Operations

Tropical Racing, Inc. (the “Company”) was incorporated on March 31, 2017 in the State of Florida. The Company was authorized to do business in Kentucky on February 19, 2019. The Company is a horseracing‑based group ownership business that breeds and syndicates thoroughbred racehorses. The Company has one subsidiary:

Circle 8 Ranch Corp. (“Circle 8”) – Circle 8 is a corporation organized under the State of Florida on February 28, 2019. Circle 8 was formed to manage racing activities of the Company’s horses. The entity is wholly owned by the Company.

Going Concern

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has not generated profits since its inception and has sustained a net loss of $ 1,712,772 and $ 530,632 for the six months ended June 30, 2021 and 2020, respectively.

The Company has financed its business activities through capital contributions from investors since inception and expects to continue to have access to ample capital financing going forward, however, no assurances can be made regarding the Company’s ability to do so.

The financial statements do not include any adjustments that might be necessary if the Company is not able to continue as a going concern.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The significant accounting policies set out below have been applied consistently to all periods presented in these consolidated financial statements.

Basis of Presentation

These financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP"). In the opinion of management, all adjustments considered necessary for the fair presentation of the financial statements for the periods presented have been included.

F-8

Basis of Consolidation

The consolidated financial statements reflect the Company’s activities along with its subsidiaries outlined in Note 1. The Company eliminates all material intercompany transactions and balances from its financial statements.

Cash and Cash Equivalents

Cash and cash equivalents consist of cash deposits held with banks, and other highly liquid short-term interest-bearing securities with maturities at the date of purchase of three months or less. From time to time, the Company maintains balances with financial institutions in excess of federally insured limits.

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation and amortization. Significant expenditures, which extend the useful lives of assets, are capitalized. The residual values and useful lives of property and equipment are reviewed by management, and adjusted as appropriate, at each balance sheet date.

The Company reviews the carrying value of thoroughbred assets for impairment whenever events and circumstances indicate that the carrying value of an asset may not be recoverable from the estimated future cash flows expected to result from its use and eventual disposition. The factors considered by management in performing this assessment include current operating results, trends and prospects, the use of the property, and the effects of health, demand, competition, and other economic factors.

The estimated useful lives of the class of assets for the current and comparative periods are as follows:

Classification	Useful live
Vehicles	5 years
Equipment	7 years

Racehorses

Racehorses are recorded at cost. The cost of the thoroughbred racehorses includes the purchase price, sourcing fees and brokerage fees. Thoroughbred racehorse assets are depreciated using the straight-line method over 36 months with no estimated salvage value. A racehorse is treated as placed in service upon its acquisition by the Company.

Revenue Recognition

The Company adopted Topic 606 on January 1, 2018. Topic 606 requires an entity to perform a five‐step assessment for each contract with customers which includes identifying the contract, identifying the performance obligations, determining the transaction price, allocating the transaction price, and recognizing revenue when the performance obligations are satisfied. Purse winnings represent revenues earned from winning thoroughbred races, and syndication fees represent revenues earned for monthly maintenance fees of syndicated horses.

Advertising

Advertising costs are expensed as they are incurred. These expenses totaled $ 248,242 and $ 32,543 for the six months ended June 2021 and 2020, respectively.

F-9

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

Making estimates requires management to exercise significant judgment. It is a t least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from Company estimates.

Risks and Uncertainties

Operational risk – The ability of the Company to generate net earnings and become profitable is based, in part, on its ability to win races. Failure to execute on its strategy to hire experienced trainers and purchase quality horses could have a material adverse effect on the financial condition of the Company.

Concentration risk – The Company’s main sources of income are purse winnings and syndication fees. If the market for horse racing declines, the Company may be unable to return positive results or attract additional sources of capital to continue its operations.

COVID 19 risk – The ongoing COVID-19 pandemic has caused a broad impact globally. While the potential economic impact brought by, and the duration of, COVID-19 may be difficult to access or predict, the pandemic and any resulting recession or economic slowdown could reduce the Company’s ability to generate net income.

Recent Accounting Pronouncements

The Financial Accounting Standards Board (“FASB”) issues updates to amend the authoritative literature in ASC. There have been several updates to date that amend the original text of ASC. Management believes that those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable or (iv) are not expected to have a significant impact on the financial statements, except those disclosed below.

NOTE 3 – REVENUE RECOGNITION

Disaggregation of Revenues

In the following table, revenues are disaggregated by timing of satisfaction of performance obligations for the periods ended June 30, 2021 and 2020:

	2021		2020
Performance obligations satisfied at a point in time	$	111,946	$	103,480
Performance obligations satisfied over time		-		-
Total Revenues	$	111,946	$	103,480

Revenues from performance obligations satisfied at a point in time consist of purse winnings and syndication fees. The Company does not have revenues from performance obligations satisfied over time.

F-10

Contract Balances

As of June 30, 2021 and 2020, there were no contract assets or liabilities related to the timing of revenue transactions.

Performance Obligations

For purse winnings, the Company determined that there is one performance obligation, and revenues are recognized at the point in time when the service has been delivered and the performance obligation has been met which is generally determined at the completion of each race.

NOTE 4 – INCOME TAXES

The Company complies with FASB ASC 740 for accounting for uncertainty in income taxes recognized in a company’s financial statements, which prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. FASB ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. Based on the Company’s evaluation, it has been concluded that there are no significant uncertain tax positions requiring recognition in the Company’s financial statements. The Company believes that its income tax positions would be sustained on audit and does not anticipate any adjustments that would result in a material change to its financial position.

Deferred income tax assets and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income.

In assessing its ability to realize its deferred tax assets, management considers whether it is more likely than not that some portion or all the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled projected future taxable income and tax planning strategies in making this assessment. Based upon this analysis, management determined that a full valuation allowance was required at each year-end.

Major components of deferred tax assets and liabilities consist of the following at June 30, 2021 and June 30, 2020:

	2021			2020
Unused net operating loss carryforward	$	1,156,000		$	1,156,000
Less: valuation allowance		(1,156,000	)		(1,156,000	)
Deferred tax asset, net	$	-		$	-

For the six months ended June 30, 2021 and 2020, the Company has no current income tax expense or benefit.

F-11

NOTE 5 – RELATED PARTY TRANSACTIONS

The Company engages Michelle Nihei Racing Stables LLC (“Nihei Stables”) to provide training services. Ms. Nihei is the spouse of the Company’s President.

The Company incurred the following expenses for the years ended June 30, 2021 and June 30, 2020:

	2021		2020
Nihei Stables – training	$	208,500	$	91,200

As of June 30, 2021, and 2020, the Company has no amounts payable to or receivable from any related party, except as discussed in Note 10.

NOTE 6 – LONG‑TERM ASSETS

Long-term assets consist of the following at June 30, 2021 and December 31,2020 as follows:

	2021			2020
Racehorses:
Acquisition cost	$	632,190		$	563,350
Accumulated depreciation		(194,160	)		(174,788	)
Net book value	$	438,030		$	388,562
Property and Equipment:
Acquisition cost	$	249,472		$	249,472
Accumulated depreciation		(68,325	)		(42,989	)
Net book value	$	181,147		$	206,483

Depreciation expense totaled $ 130,722 and $ 65,679 for the six months ended June 30, 2021 and June 30, 2020, respectively.

NOTE 7 – INVESTMENT IN STALLION SHARES

In November 2020, the Company invested $ 85,000 for a fractional interest for the stallion, Global Campaign. The amount was funded by an initial cash payment of $ 42,500 and the remaining was financed with a note due in November 2021. As a fractional owner, the Company is obligated to pay its proportionate share of expenses to maintain the stallion. Additionally, the Company is entitled to a proportionate share of profits.

F-12

NOTE 8 – LEASES

The Company maintained an operating lease for corporate offices and maintains a finance lease for use of their ranch. The Company is the lessee in a lease contract when it obtains the right to control the asset. Right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the lease, both of which are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. Leases with a lease term of 12 months or less at inception are not recorded on the consolidated balance sheets and are expensed on a straight-line basis over the lease term in the consolidated statements of operations.

The Company determines the lease term by assuming the exercise of renewal options that are reasonably certain. As most of the Company’s leases do not provide an implicit interest rate, the Company uses local incremental borrowing rates based on the information available at the commencement date in determining the present value of future payments. When the Company’s contracts contain lease and non‑lease components, it accounts for both components as a single lease component.

The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use assets, other current liabilities, and operating lease liabilities in the Company’s consolidated balance sheets. Finance leases are included in property and equipment, and other long-term liabilities in its consolidated balance sheets.

Components and supplemental information for the six months ended June 30, 2021 and December 31, 2020 are as follows:

	2021			2020
Components of lease expense:
Operating lease cost	$	-		$	-
Finance lease cost
Amortization of right-of-use assets	$	16,338		$	32,676
Interest on lease liabilities	$	54,145		$	110,273
Supplemental cash flow information relating to leases:
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	-		$	-
Operating cash flows from finance leases	$	54,145		$	110,273
Financing cash flows from finance leases	$	96,855		$	98,927
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	-		$	-
Finance leases	$	2,960,922		$	2,960,922
Remaining lease terms:
Finance leases		9 months			15 months
Weighted average discount rate:
Finance leases		4	%		4	%

F-13

Maturities of liabilities:
For the six months ending June 30,	Finance Leases			Operating Leases
2021		51,000			-
2022		2,670,500			-
Total lease payments		2,701,500			-
Less imputed interest		(59,303	)		-
Total	$	2,642,197		$	-

NOTE 9 – NOTES PAYABLE

	2021		2020
Note payable to Kubota Credit Corp secured by a vehicle due in monthly installments of $231 interest free	$	5,066	$	6,447
Note payable to Kubota Credit Corp secured by a vehicle due in monthly installments of $333 interest free		13,965		15,961
Note payable to Marlin Bank secured by equipment due in monthly installments of $ 69 including interest of 18.32%		1,090		1,486
Note payable to U.S. Small Business Administration secured by substantially all of the assets of the Company due 12 months from the date of promissory note in monthly installments of $ 500 including interest of 3.75%.		102,300		102,300
Note payable to U.S. Small Business Administration s Paycheck Protection Program. Any portion not forgiven includes interest of 1.0%		-		6,951
Note payable to Winstar Farm LLC due in one installment of $ 42,500 on or before November 1, 2021 including interest of 4.0%, secured by the investment in stallion shares and personally guaranteed by the Company s President		42,500		42,500
Note payable to Huntington National Bank secured by a vehicle due in monthly installments of $882 including interest of 5.3%, personally guaranteed by the Company s President		47,674		51,635
Note payable to SE Toyota secured by a vehicle due in monthly installments of $918 including interest of 5.5%, personally guaranteed by the Company s President		35,862		40,870
		248,457		268,150
Less current maturities:		71,945		74,816
Total long-term maturities	$	176,512	$	193,334

Principal payments on notes payables are as follows:

2021	$	55,123
2022		27,323
2023		26,131
2024		26,076
2025 and beyond		113,804
	$	248,457

Interest expense related to notes payable for the years ended June 30, 2021 and 2020 amounted to $ 6,977 and $ 1,129, respectively.

F-14

NOTE 10 – DUE TO SHAREHOLDER

The amounts due to shareholder are owed to the Company’s President. These represent unpaid salary and non-interest-bearing loans. The loans are considered long‑term and classified accordingly. The balances at June 30, 2021 and December 31, 2020 were $ 427,343 and $ 358,070, respectively.

NOTE 11 – SHARES OF STOCK

The Company is authorized to issue 250,000,000 shares (par value of $ 0.0001) which consists of 200,000,000 Class A common shares, 25,000,000 Class B common shares and 25,000,000 shares of preferred stock. The shares are issued to both accredited investors under Regulation D and sophisticated investors with access to information through a subscription agreement.

The balances at June 30, 2021 and December 31, 2020 as follows:

Class A common shares:

	2021			2020
Balance, beginning of year		48,195,443			43,298,793
Issued		626,825			4,896,650
Repurchased		-			-
Balance, end of period		48,822,268			48,195,443
Average shares outstanding		48,508,856			45,747,118
Earnings (loss) per share	$	(0.04	)	$	(0.04	)

The Company raised an additional $ 525,000 under Regulation D however has not issued any shares for this amount to date.

The Company has raised $ 141,433 at a share price of $2.25 through Crowdfunding efforts pursuant to Regulation CF, promulgated under the Securities Act of 1933, as amended.

The Company raised $ 1,973,950 at a unit price of $ 3.50 under Regulation A Tier 2 offering qualified by the Securities and Exchange Commission on March 10, 2021

There were 10,000,000 Class B common shares issued to the Company's President and no preferred shares issued and outstanding as at June 30, 2021 and December 31, 2020

NOTE 12 – COMMITMENTS AND CONTINGENCIES

Legal Matters - Company is not currently involved with and does not know of any pending or threatening litigation against the Company or its management.

NOTE 13 – CORONAVIRUS

In March 2020, the World Health Organization declared the coronavirus disease (COVID‐19) a global pandemic. This highly contagious disease has spread worldwide affecting workforces, customers, economies, and financial markets globally, potentially leading to an economic downturn. It has also disrupted the normal operations of many businesses. As governments and private sectors respond to this evolving threat, their actions, and restrictions they have or may impose, could further adversely impact business operations.

NOTE 14 - SUBSEQUENT EVENTS

Management has evaluated subsequent events through September 24, 2021, the date the financial statements were available for issuance. Based on this evaluation, other than the disclosure below, no additional material events were identified which require adjustment or disclosure in the financial statements.

F-15

Index to Financial Statements

	Page
INDEPENDENT AUDITORS’ REPORT	F-19
AUDITED FINANCIAL STATEMENTS
Consolidated Balance Sheets as of December 31, 2020 and December 31, 2019	F-21
Consolidated Statements of Operations for the Years Ended December 31, 2020 and 2019	F-22
Consolidated Statements of Changes in Shareholders’ Equity for the Years Ended December 31, 2020 and 2019	F-23
Consolidated Statements of Cash Flows for the Years Ended December 31, 2020 and 2019	F-24
Notes to Consolidated Financial Statements	F-25

F-16

TROPICAL RACING, INC.

AND SUBSIDIARIES

 Consolidated Financial Statements

For the Years Ended December 31, 2020 and 2019

F-17

TABLE OF CONTENTS

TROPICAL RACING INC. AND SUBSIDIARIES

	PAGE(S)
INDEPENDENDENT AUDITORS’ REPORT	F-19-F-20
CONSOLIDATED:
BALANCE SHEETS		F-21
STATEMENTS OF OPERATIONS		F-22
STATEMENTS OF SHAREHOLDERS’ EQUITY		F-23
STATEMENTS OF CASH FLOWS		F-24
NOTES TO THE FINANCIAL STATEMENTS	F-25

F-18

INDEPENDENT AUDITORS’ REPORT

Board of Directors

Tropical Racing Inc.

Versailles, Kentucky 40383

We have audited the consolidated financial statements of Tropical Racing Inc. and Subsidiaries (the “Company“) which comprise the consolidated balance sheets as of December 31, 2020 and 2019, and the related consolidated statements of operations, shareholders’ equity, and cash flows for the years then ended and the related notes to the consolidated financial statements.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and the results of its operations and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

F-19

Emphasis-of-Matters

Substantial Doubt about the Company's Ability to Continue as a Going Concern

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has suffered recurring losses from operations and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Our opinion is not modified with respect to this matter.

Coronavirus

As discussed in Note 13, In March 2020, the World Health Organization declared the coronavirus disease (COVID‐19) a global pandemic. This highly contagious disease has spread worldwide affecting workforces, customers, economies and financial markets globally, potentially leading to an economic downturn. It has also disrupted the normal operations of many businesses. As governments and private sectors respond to this evolving threat, their actions and restrictions they have or may impose, could further adversely impact business operations.

Should any of these potential impacts continue for an extended period of time, the impact on the company could have a material adverse effect on its operations.   As these are subsequent events, these consolidated financial statements do not reflect such impact.

Friedman CPA Group

Certified Public Accountants

April 28, 2021

Plantation, Florida

F-20

TROPICAL RACING INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

AS OF DECEMBER 31, 2020, AND 2019

	2020			2019
ASSETS
Current assets:
Cash and cash equivalents	$	166,914		$	94,901
Accounts receivable		16,209			-
Prepaid expenses		15,000			-
Total current assets		198,123			94,901
Property and equipment		206,483			116,620
Racehorses		388,562			162,041
Investment in stallion shares		85,000			-
Finance lease right-of-use assets		2,895,570			2,928,246
Total assets	$	3,773,738		$	3,301,808
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued liabilities	$	307,269		$	121,554
Current portion of notes payable		74,816			13,029
Current portion of finance lease liability		94,996			98,727
Total current liabilities		477,081			233,310
Notes payable		193,334			50,773
Finance lease liability		2,644,056			2,739,052
Due to shareholder		358,070			212,518
Total liabilities		3,672,541			3,235,653
Shareholders' Equity
Common stock and paid-in capital		5,077,965			3,401,737
Retained deficit		(4,976,768	)		(3,335,582	)
Total shareholders' equity		101,197			66,155
Total liabilities and shareholders' equity	$	3,773,738		$	3,301,808

F-21

TROPICAL RACING INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019

	2020			2019
REVENUES
Purse winnings	$	226,798		$	76,625
Syndication fees		90,151			13,542
Total revenues		316,949			90,167
EXPENSES
Racehorses		859,245			632,584
Professional fees		528,172			425,163
Salaries and benefits		157,558			175,232
Ranch		120,161			116,768
Marketing and promotions		90,303			72,206
Depreciation		143,347			86,972
Interest		124,552			79,923
Travel and entertainment		39,383			55,071
General and administrative		49,382			40,265
Amortization of ROU asset - finance lease		32,676			32,676
Vehicles		8,754			6,368
Total expenses		2,153,533			1,723,228
Operating loss		(1,836,584	)		(1,633,061	)
Gain on sale of racehorses		184,930			2,745
Other income (loss)		10,468			(5,551	)
Loss before income taxes		(1,641,186	)		(1,635,867	)
Income taxes		-			-
Net loss		(1,641,186	)		(1,635,867	)
Less: Net loss attributable to non-controlling interests		-			(5,115	)
Net loss attributable to Tropical Racing, Inc.	$	(1,641,186	)	$	(1,630,752	)

F-22

TROPICAL RACING INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019

	2020			2019
Common stock
Balance, beginning of year	$	4,330		$	4,156
Common stock issued		489			174
Balance, end of year		4,819			4,330
Paid-in capital
Balance, beginning of year		3,397,407			1,751,588
Common stock issued		1,675,739			1,606,311
Derecognition of non-controlling interests		-			39,508
Balance, end of year		5,073,146			3,397,407
Retained deficit
Balance, beginning of year		(3,335,582	)		(1,704,830	)
Net loss		(1,641,186	)		(1,630,752	)
Balance, end of year		(4,976,768	)		(3,335,582	)
Non-controlling interests
Balance, beginning of year		-			44,623
Net loss		-			(5,115	)
Derecognition of non-controlling interests		-			(39,508	)
Balance, end of year		-			-
Total shareholders' equity	$	101,197		$	66,155

F-23

TROPICAL RACING INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019

	2020			2019
OPERATING ACTIVITIES
Net loss	$	(1,641,186	)	$	(1,635,867	)
Adjustments to reconcile net loss to net cash used in operations:
Depreciation and amortization		176,023			119,648
Gain on disposal		(184,930	)		(2,745	)
Other		-			5,003
Changes in operating assets and liabilities:
Accounts receivable		(16,209	)		84
Prepaid expenses		(15,000	)		-
Accounts payable and accrued liabilities		185,715			82,259
Net cash used in operations		(1,495,587	)		(1,431,621	)
FINANCINGACTIVITIES
Proceeds from issuance of debt		224,077			63,802
Payments of principal of notes payable		(19,729	)		-
Proceeds from shareholder loans		145,552			102,462
Payments of principal on finance lease liability		(98,727	)		(123,143	)
Issuance of common stock		1,676,228			1,606,485
Net cash provided by financing activities		1,927,401			1,649,606
INVESTINGACTIVITIES
Purchases of property and equipment		(127,045	)		(118,698	)
Purchases of racehorses		(436,385	)		(160,179	)
Investment in stallion shares		(85,000	)		-
Proceeds from sales of racehorses		288,629			65,383
Net cash used in investing activities		(359,801	)		(213,494	)
Net increase in cash and cash equivalents		72,013			4,491
Cash and cash equivalents, beginning of year		94,901			90,410
Cash and cash equivalents, end of year		166,914		$	94,901

F-24

TROPICAL RACING INC. AND SUBSIDIARIES 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019

NOTE 1 - NATURE OF OPERATIONS

Description of Organization and Business Operations

Tropical Racing, Inc. (the “Company”) was incorporated on March 31, 2017 in the State of Florida. The Company was authorized to do business in Kentucky on February 19, 2019. The Company is a horseracing‑based group ownership business that breeds and syndicates thoroughbred racehorses.  The Company has five subsidiaries:

1.	Tropical Racing, LLC (“TR LLC”) – TR LLC is a limited liability company organized under the laws of the State of Florida on July 6, 2017.TR LLC’s registered office is in the State of Florida. TR LLC was formed to acquire, maintain, train, and develop the thoroughbred racehorses for racing and to race, manage, lease, or dispose of the horses. On September 27, 2019, TR LLC was formally dissolved.
2.	Tropical Racing TRG2, LLC (“TRG2”) – TRG2 is a limited liability company organized under the State of Florida on July 6, 2017. TRG2’s registered office is in the State of Florida. TRG2 was formed to acquire, maintain, train, and develop the thoroughbred racehorses for racing and to race, manage, lease, or dispose of the horses. On September 27, 2019, TRG2 was formally dissolved.
3.	Tropical Racing TRG3, LLC (“TRG3”) – TRG3 is a limited liability company organized under the State of Florida on July 6, 2017. TRG3’s registered office is in the State of Florida. TRG3 was formed to acquire, maintain, train, and develop the thoroughbred racehorses for racing and to race, manage, lease, or dispose of the horses. On September 27, 2019, TRG3 was formally dissolved.
4.	Tropical Redtide LLC (“TR Redtide”) TR Redtide is a limited liability company organized under the State of Florida on February 22, 2018. TR Redtide’s registered office is in the State of Florida. TR Redtide was formed to acquire, maintain, train, and develop the thoroughbred racehorses for racing and to race, manage, lease, or dispose of the horses. On September 27, 2019, TR Redtide was formally dissolved.
5.	Circle 8 Ranch Corp. (“Circle 8”) – Circle 8 is a corporation organized under the State of Florida on February 28, 2019. Circle 8 was formed to manage racing activities of the Company’s horses. The entity is wholly owned by the Company.

Going Concern

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has not generated profits since its inception and has sustained a net loss of $ 1,641,186  and $ 1,630,752 for the years ended December 31, 2020 and 2019, respectively.

F-25

The Company has financed its business activities through capital contributions from investors since inception and expects to continue to have access to ample capital financing going forward, however, no assurances can be made regarding the Company’s ability to do so.

The financial statements do not include any adjustments that might be necessary if the Company is not able to continue as a going concern.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The significant accounting policies set out below have been applied consistently to all periods presented in these consolidated financial statements.

Basis of Presentation 

These financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP"). In the opinion of management, all adjustments considered necessary for the fair presentation of the financial statements for the periods presented have been included.

Basis of Consolidation

The consolidated financial statements reflect the Company’s activities along with its  subsidiaries outlined in Note 1. The Company eliminates all material intercompany transactions and balances from its financial statements.

Cash and Cash Equivalents

Cash and cash equivalents consist of cash deposits held with banks, and other highly liquid short-term interest-bearing securities with maturities at the date of purchase of three months or less. From time to time, the Company maintains balances with financial institutions in excess of federally insured limits.

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation and amortization. Significant expenditures, which extend the useful lives of assets, are capitalized. The residual values and useful lives of property and equipment are reviewed by management, and adjusted as appropriate, at each balance sheet date.

The Company reviews the carrying value of thoroughbred assets for impairment whenever events and circumstances indicate that the carrying value of an asset may not be recoverable from the estimated future cash flows expected to result from its use and eventual disposition. The factors considered by management in performing this assessment include current operating results, trends and prospects, the use of the property, and the effects of health, demand, competition, and other economic factors.

The estimated useful lives of the class of assets for the current and comparative periods are as follows:

Classification	Useful live
Vehicles	5 years
Equipment	7 years

F-26

Racehorses

Racehorses are recorded at cost. The cost of the thoroughbred racehorses includes the purchase price, sourcing fees and brokerage fees. Thoroughbred racehorse assets are depreciated using the straight-line method over 36 months with no estimated salvage value. A racehorse is treated as placed in service upon its acquisition by the Company.

Revenue Recognition

The Company adopted Topic 606 on January 1, 2018. Topic 606 requires an entity to perform a five‐step assessment for each contract with customers which includes identifying the contract, identifying the performance obligations, determining the transaction price, allocating the transaction price, and recognizing revenue when the performance obligations are satisfied.  Purse winnings represent revenues earned from winning thoroughbred races, and syndication fees represent revenues earned for monthly maintenance fees of syndicated horses.

Advertising

Advertising costs are expensed as they are incurred. These expenses totaled $ 55,100 and $ 35,019 for the years ended 2020 and 2019, respectively.

Use of Estimates 

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from Company estimates.

Risks and Uncertainties

Operational risk – The ability of the Company to generate net earnings and become profitable is based, in part, on its ability to win races. Failure to execute on its strategy to hire experienced trainers and purchase quality horses could have a material adverse effect on the financial condition of the Company.

Concentration risk – The Company’s main sources of income are purse winnings and syndication fees. If the market for horse racing declines, the Company may be unable to return positive results or attract additional sources of capital to continue its operations.

COVID 19 risk – The ongoing COVID-19 pandemic has caused a broad impact globally. While the potential economic impact brought by, and the duration of, COVID-19 may be difficult to access or predict, the pandemic and any resulting recession or economic slowdown could reduce the Company’s ability to generate net income.

F-27

Recent Accounting Pronouncements 

The Financial Accounting Standards Board (“FASB”) issues updates to amend the authoritative literature in ASC. There have been several updates to date that amend the original text of ASC. Management believes that those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable or (iv) are not expected to have a significant impact on the financial statements, except those disclosed below.

NOTE 3 – REVENUE RECOGNITION

Disaggregation of Revenues

In the following table, revenues are disaggregated by timing of satisfaction of performance obligations for the periods ended December 31:

	2020		2019
Performance obligations satisfied at a point in time	$	316,949	$	90,167
Performance obligations satisfied over time		-		-
Total Revenues	$	316,949	$	90,167

Revenues from performance obligations satisfied at a point in time consist of purse winnings and syndication fees. The Company does not have revenues from performance obligations satisfied over time.

Contract Balances

As of December 31, 2020 and 2019, there were no contract assets or liabilities related to the timing of revenue transactions.

Performance Obligations

For purse winnings, the Company determined that there is one performance obligation, and revenues are recognized at the point in time when the service has been delivered and the performance obligation has been met which is generally determined at the completion of each race.

NOTE 4 – INCOME TAXES

The Company complies with FASB ASC 740 for accounting for uncertainty in income taxes recognized in a company’s financial statements, which prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. FASB ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. Based on the Company’s evaluation, it has been concluded that there are no significant uncertain tax positions requiring recognition in the Company’s financial statements. The Company believes that its income tax positions would be sustained on audit and does not anticipate any adjustments that would result in a material change to its financial position.

F-28

Deferred income tax assets and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income.

In assessing its ability to realize its deferred tax assets, management considers whether it is more likely than not that some portion or all the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled projected future taxable income and tax planning strategies in making this assessment. Based upon this analysis, management determined that a full valuation allowance was required at each year-end.

Major components of deferred tax assets and liabilities consist of the following at December 31, 2020 and 2019:

	2020			2019
Unused net operating loss carryforward	$	1,156,000		$	896,000
Less: valuation allowance		(1,156,000	)		(896,000	)
Deferred tax asset, net	$	-		$	-

For the years ended December 31, 2020 and 2019, the Company has no current income tax expense or benefit.

NOTE 5 – RELATED PARTY TRANSACTIONS

The Company engages Michelle Nihei Racing Stables LLC (“Nihei Stables”) to provide training services. Ms. Nihei is the spouse of the Company’s President.

The Company incurred the following expenses for the years ended December 31, 2020 and 2019:

	2020		2019
Nihei Stables – training	$	283,437	$	252,514

As of December 31, 2020, and 2019, the Company has no amounts payable to or receivable from any related party, except as discussed in Note 10.

F-29

NOTE 6 – LONG‑TERM ASSETS

Long-term assets consist of the following at December 31, 2020 and 2019 as follows:

	2020			2019
Racehorses:
Acquisition cost	$	563,350		$	249,411
Accumulated depreciation		(174,788	)		(87,370	)
Net book value	$	388,562		$	162,041
Property and Equipment:
Acquisition cost	$	249,472		$	123,950
Accumulated depreciation		(42,989	)		(7,330	)
Net book value	$	206,483		$	116,620

Depreciation expense totaled $ 143,347 and $ 86,972 for the years ended December 31, 2020 and 2019, respectively.

NOTE 7 – INVESTMENT IN STALLION SHARES

In November 2020, the Company invested $ 85,000 for a fractional interest for the stallion, Global Campaign. The amount was funded by an initial cash payment of $ 42,500 and the remaining was financed with a note due in November 2021. As a fractional owner, the Company is obligated to pay its proportionate share of expenses to maintain the stallion. Additionally, the Company is entitled to a proportionate share of profits.

NOTE 8 – LEASES

The Company maintained an operating lease for corporate offices and maintains a finance lease for use of their ranch. The Company is the lessee in a lease contract when it obtains the right to control the asset. Right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the lease, both of which are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. Leases with a lease term of 12 months or less at inception are not recorded on the consolidated balance sheets and are expensed on a straight-line basis over the lease term in the consolidated statements of operations.

The Company determines the lease term by assuming the exercise of renewal options that are reasonably certain. As most of the Company’s leases do not provide an implicit interest rate, the Company uses local incremental borrowing rates based on the information available at the commencement date in determining the present value of future payments. When the Company’s contracts contain lease and non‑lease components, it accounts for both components as a single lease component.

The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use assets, other current liabilities, and operating lease liabilities in the Company’s consolidated balance sheets. Finance leases are included in property and equipment, and other long-term liabilities in its consolidated balance sheets.

F-30

Components and supplemental information for the years ended December 31, 2020 and 2019 are as follows:

	2020			2019
Components of lease expense:
Operating lease cost	$	-		$	21,150
Finance lease cost
Amortization of right-of-use assets	$	32,676		$	32,676
Interest on lease liabilities	$	110,273		$	75,857
Supplemental cash flow information relating to leases:
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	-		$	21,150
Operating cash flows from finance leases	$	110,273		$	75,857
Financing cash flows from finance leases	$	98,927		$	123,143
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	-		$	-
Finance leases	$	2,960,922		$	2,960,922
Remaining lease terms:
Finance leases	15 months			27 months
Weighted average discount rate:
Finance leases		4	%		4	%

Maturities of liabilities:
For the years ending December 31,	Finance Leases			Operating Leases
2021		202,000			-
2022		2,670,500			-
2023		-			-
2024		-			-
2025		-			-
Total lease payments		2,872,500			-
Less imputed interest		(133,448	)		-
Total	$	2,739,052		$	-

F-31

 
NOTE 9 – NOTES PAYABLE 

	2020		2019
Note payable to Kubota Credit Corp secured by a vehicle due in monthly installments of $231 including interest of 0%	$	6,447	$	9,123
Note payable to Kubota Credit Corp secured by a vehicle due in monthly installments of $333 including interest of 0%		15,961		-
Note payable to Marlin Bank secured by equipment due in monthly installments of $ 69 including interest of 18.32%		1,486		4,167
Note payable to U.S. Small Business Administration secured by substantially all of the assets of the Company due 12 months from the date of promissory note in monthly installments of $ 500 including interest of 3.75%.		102,300		-
Note payable to U.S. Small Business Administration's Paycheck Protection Program. Any portion not forgiven includes interest of 1.0%		6,951		-
Note payable to Winstar Farm LLC due in one installment of $ 42,500 on or before November 1, 2021 including interest of 4.0%, secured by the investment in stallion shares and personally guaranteed by the Company's President		42,500		-
Note payable to Huntington National Bank secured by a vehicle due in monthly installments of $ 882 including interest of 5.3%, personally guaranteed by the Company's President		51,635		-
Note payable to SE Toyota secured by a vehicle due in monthly installments of $ 918 including interest of 5.5%, personally guaranteed by the Company's President		40,870		50,512
		268,150		63,802
Less current maturities:		74,816		13,029
Total long-term maturities	$	193,334	$	50,773

Principal payments on notes payables are as follows:

2021	$	74,816
2022		27,323
2023		26,131
2024		26,076
2025 and beyond		113,804
	$	268,150

Interest expense related to notes payable for the years ended December 31, 2020 and 2019 amounted to $ 13,779 and $ 4,066, respectively.

F-32

NOTE 10 – DUE TO SHAREHOLDER

The amounts due to shareholder are owed to the Company’s President. These represent unpaid salary and non-interest-bearing loans. The loans are considered long‑term and classified accordingly. The balances at December 31, 2020 and 2019 were $ 358,070  and $ 212,518, respectively.

NOTE 11 – SHARES OF STOCK

The Company is authorized to issue 250,000,000 shares (par value of $ 0.0001) which consists of 200,000,000 Class A common shares, 25,000,000 Class B common shares and 25,000,000 shares of preferred stock. The shares are issued to both accredited investors under Regulation D and sophisticated investors with access to information through a subscription agreement.

The balances at December 31, 2020 and 2019 as follows:

Class A common shares:

	2020			2019
Balance, beginning of year		43,298,793			41,554,593
Issued		4,896,650			1,774,200
Repurchased		-			-
Balance, end of year		48,195,443			43,298,793
Average shares outstanding		45,747,118			42,426,693
Earnings (loss) per share	$	(0.04	)	$	(0.04	)

There were 10,000,000 Class B common shares issued to the Company's President and no preferred shares issued and outstanding as at December 31, 2020 and 2019.

NOTE 12 – COMMITMENTS AND CONTINGENCIES

Legal Matters - Company is not currently involved with and does not know of any pending or threatening litigation against the Company or its management.

NOTE 13 – CORONAVIRUS

In March 2020, the World Health Organization declared the coronavirus disease (COVID‐19) a global pandemic. This highly contagious disease has spread worldwide affecting workforces, customers, economies, and financial markets globally, potentially leading to an economic downturn. It has also disrupted the normal operations of many businesses. As governments and private sectors respond to this evolving threat, their actions, and restrictions they have or may impose, could further adversely impact business operations.

F-33

NOTE 14 – SUBSEQUENT EVENTS 

Management has evaluated subsequent events through April 28, 2021, the date the financial statements were available for issuance. Based on this evaluation, other than the disclosure below, no additional material events were identified which require adjustment or disclosure in the financial statements.

The Company received approval on its Regulation A Offering Circular on March 10, 2021 by the Securities and Exchange Commission. Additionally, during 2021, the Company raised $ 642,432 in capital to continue funding operations consisting of $ 500,000 from an existing shareholder under a Regulation D agreement and $ 142,432 from a crowdfunding offering with Republic, an online crowdfunding platform.

F-34

PART III – EXHIBITS

Exhibit No.	Description
EX1A-2.1#	Amended and Restated Articles of Incorporation of Tropical Racing, Inc.
EX1A-2.3#	Bylaws of Tropical Racing, Inc.
EX1A-4.1#	Form of Subscription Agreement
EX1A-4.2#	Form of Warrant
EX1A-4.3#	Form of 2020 Bridge Offering Subscription Agreement
EX1A-6.1#	2020 Equity Incentive Plan of Tropical Racing, Inc.
EX1A-6.2#	Employment Agreement, dated January 1, 2018, between Tropical Racing, Inc. and Troy Levy
EX1A-6.3#	Engagement Agreement, dated August 13, 2020, between Tropical Racing, Inc. and Sunny Sharma
EX1A-6.4#	Broker Dealer Agreement, dated August 28, 2020, between Tropical Racing, Inc. and Dalmore Group, LLC
EX1A-6.5#	Purchase Option Agreement, dated March 15, 2019, between Tropical Racing, Inc. and Grassy Springs Farm, LLC
EX1A-6.6#	SBA Loan #64991967906, dated March 16, 2020, between Tropical Racing, Inc. and the Small Business Administration
EX1A-6.7#	SBA Loan #7175647906, dated June 17, 2020, between Circle 8 Ranch and the Small Business Administration
EX1A-6.8#	Paycheck Protection Program Promissory Note and Agreement, dated June 19, 2020, between Tropical Racing, Inc. and Wells Fargo
EX1A 6.9†	Amended and Restated Employment Agreement, dated February 22, 2022, between Tropical Racing, Inc. and Troy Levy
EX1A 6.10†	Series Seed Preferred Stock Purchase Agreement, dated October 21, 2021, between Tropical Racing, Inc. and Game of Silks, Inc.
EX1A-10.1#	Power of Attorney (included on signature page)
EX1A-11.1†	Consent of Independent Auditor
EX1A-12.1†	Opinion of Legal Counsel

† Filed herewith. 

# Previously filed

59

SIGNATURES

Pursuant to the requirements of Regulation A+, the issuer certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form 1-A and has duly caused this offering statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Versailles, State of Kentucky, on March 11, 2022.

Tropical Racing, Inc.
By:	/s/ Troy Levy
	Name: Troy Levy
	Title:   President and Chief Executive Officer

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Troy Levy, his true and lawful attorney-in-fact and agent, with full power of substitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments to this Form 1-A offering statement, and to file the same with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and ratifying and confirming all that said attorney-in-fact and agent or his substitute or substitutes may lawfully do or cause to be done by virtue hereof. 

This offering statement has been signed by the following persons in the capacities and on the dates indicated. 

/s/ Troy Levy	Date: March 11, 2022
Name: Troy Levy Title: President, Chief Executive Officer and Director
/s/ Sunny Sharma	Date: March 11, 2022
Name: Sunny Sharma Title: Interim Chief Financial Officer
/s/ Troy Levy as Attorney-in-Fact	Date: March 11, 2022
Name: Ronald Kapphahn Title: Director

60

EX1A-6 MAT CTRCT.9

EXHIBIT 6.9

EXECUTION VERSION

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (“Agreement”) is entered into and effective as of this 22^nd day of February 2022 (the “Effective Date”), by and between TROPICAL RACING, INC., a Florida corporation (the “Corporation”), and TROY LEVY (hereinafter, the “Executive”). This Agreement supersedes and supplants the original Employment Agreement, dated January 1, 2018, between the parties.

W I T N E S S E T H:

WHEREAS, the Corporation desires to employ the Executive as Chief Executive Officer of the Corporation and the Executive desires to be employed by the Corporation on the terms and conditions contained herein;

WHEREAS, the Corporation desires to amend and restate the prior employment agreement with Executive as Chief Executive Officer on the terms and conditions contained herein;

WHEREAS, the Corporation has been represented by Greenberg Traurig, P.A. (the “Firm”) during the negotiation and preparation of this Agreement; and

WHEREAS, the Executive acknowledges that the Firm represents only the Corporation and that he has been provided the opportunity to retain his own independent legal counsel.

NOW, THEREFORE, for and in consideration of the premises hereof and the mutual covenants contained herein, the parties hereto hereby covenant and agree as follows:

1. Definitions. When used in this Agreement, the following terms shall have the following meanings:

(a) “Accrued Rights” means: (i) all accrued but unpaid Base Salary through the end of the Executive’s last date of employment; (ii) any unpaid or unreimbursed expenses incurred and due under Section 5(a), to the extent incurred prior to Executive’s last date of employment; and (iii) any accrued but unpaid benefits provided under the Corporation’s employee benefit plans pursuant to Section 5(b), subject to and in accordance with the terms of those plans.

(b) “Base Salary” means the salary provided for in Section 4(a).

(c) “Board” means the Board of Directors of the Corporation.

1

EXECUTION VERSION

(d) “Cause” means (a) the unlawful use or possession of illegal drugs by the Executive while performing any of his duties or responsibilities under this Agreement or performing his duties and responsibilities while intoxicated; (b) fraud, embezzlement, theft, or material dishonesty with respect to the Corporation or a Related Entity; (c) willful and continued failure to perform, or gross negligence in the performance of, the Executive’s duties and responsibilities; (d) the Executive’s material breach of any of the material terms of this Agreement and, if the material breach is curable, the failure to cure such material breach within thirty (30) days of the Corporation’s notice of such breach; (e) conviction of, or plea of guilty or nolo contendere to, a felony or any crime involving fraud, dishonesty or moral turpitude or which has an adverse monetary effect upon the Corporation’s business; (f) the Executive’s material breach of his fiduciary duties as an officer, trustee, or director; (g) the Executive’s willful and deliberate misconduct which is intended to have, has, or could be reasonably expected to have, a material adverse effect upon the business, interests or reputation of the Corporation or any of its Related Entities; or (h) the Executive’s willful refusal or willful failure to carry out a lawful and reasonable written directive of the Board.

(e) “Confidential Information” means all trade secrets and information about the Corporation or any Related Entity or its business disclosed to the Executive or known by the Executive as a consequence of or through the position of his employment with the Corporation or any Related Entity (including information conceived, originated, discovered or developed by the Executive and information acquired by the Corporation or any Related Entity from others) prior to or during the Term of Employment, and not generally or publicly known (other than as a result of disclosure by the Executive in breach of this Agreement). Confidential Information includes, but is not limited to, such information related to the Corporation’s or any Related Entity’s current and potential members, shareholders, and other investors, including their identities and contact information, and the Corporation’s financial condition, prospects, technology, customers, suppliers, sources of leads and methods of doing business.

(f) “Disability” means a permanent and total disability (within the meaning of Section 22(e) of the Internal Revenue Code of 1986, as amended (the “Code”)), as determined by a medical doctor satisfactory to the Board.

(g) “Related Entity” means any direct or indirect subsidiary of the Corporation, direct or indirect parent of the Corporation, and any business, corporation, partnership, limited liability company or other entity designated by the Board in which the Corporation, its parent or a subsidiary holds a substantial ownership interest, directly or indirectly or for which the Corporation provides services.

(h) “Term of Employment” means the period during which the Executive shall be employed by the Corporation pursuant to the terms of this Agreement.

(i) “Termination Date” means the date on which the Term of Employment ends.

2. Employment.

(a) Employment and Term. The Corporation hereby agrees to employ the Executive and the Executive hereby agrees to serve the Corporation during the Term of Employment on the terms and conditions set forth herein.

2

EXECUTION VERSION

(b) Duties of Executive. During the Term of Employment, the Executive shall serve as Chief Executive Officer of the Corporation. As Chief Executive Officer, the Executive shall report to the Board, or such other person or body as the Board directs in writing, and shall have the duties and responsibilities commensurate with his position. The Executive shall at all times perform his duties and responsibilities honestly, diligently, in good faith and to the best of his ability. Unless the Board otherwise consents, approves or directs in writing, the Executive shall observe and comply with (i) all of the rules, regulations, policies and procedures established by the Corporation, (ii) any code of conduct that applies to the officers and management of the Corporation, and (iii) all applicable laws, rules and regulations imposed on the Corporation by any governmental or regulatory authorities from time to time. Except as set forth below, the Executive’s employment by the Corporation shall be full-time and the Executive agrees that he will devote substantially all of his business attention and energies to the performance of his obligations hereunder.

Executive acknowledges and agrees that Executive owes a fiduciary duty of loyalty, fidelity, and allegiance to act at all times in the best interests of the Corporation and to do no act which would, directly or indirectly, injure the Corporation’s business, interests, or reputation. In keeping with Executive’s fiduciary duties to the Corporation, Executive agrees that Executive shall not become involved in a conflict of interest with the Corporation or its Related Entities, or upon discovery thereof, allow such a conflict to continue. Moreover, Executive shall not engage in any activity that might involve a possible conflict of interest without first obtaining written approval from the Board.

The Corporation recognizes that Executive may engage in or continue to engage in outside activities that do not involve a conflict of interest, such as serving on community boards or the boards of professional or trade organizations, volunteering for community organizations or professional or trade organizations, managing personal investments, or engaging in charitable activities, without the prior consent of the Corporation.

3. Term. The term of employment under this Agreement, and the employment of the Executive hereunder, shall commence on the Effective Date and shall expire on the (Third) anniversary of the Effective Date (the “Initial Term”) unless sooner terminated in accordance with Section 6. At the end of the Initial Term and each of the first three Renewal Terms (as defined below), the term of employment automatically shall renew for successive three (3) year terms (each a “Renewal Term”) (subject to earlier termination as provided in Section 6), unless the Corporation (as determined in the discretion of the Board) or the Executive determines not to renew the Agreement and delivers written notice to the other party at least sixty (60) days prior to the expiration of the Initial Term or the applicable Renewal Term of its or his election not to renew the term of employment. In that event, the Agreement and Executive’s employment shall be terminated as of the end of the applicable Initial Term or Renewal Term and the Corporation shall have no further obligations to Executive other than the Accrued Rights.

4. Compensation.

(a) Base Salary. During the Term of Employment, the Executive shall initially receive a base salary of $260,000 per calendar year. The Base Salary shall be payable in installments consistent with the Corporation’s normal payroll schedule, subject to applicable withholding and other taxes. The Board shall annually review Executive’s Base Salary and may choose to increase the Base Salary, but it may not reduce it unless there is across-the-board salary reduction for other employees of the Corporation.

3

EXECUTION VERSION

(b) Bonus. For each calendar year of the Term of Employment in which the Corporation is profitable, the Executive may be eligible to receive a performance-based cash annual bonus (the “Bonus”). However, the decision to provide any Bonus, related performance milestones and metrics, and the amount and terms of any Bonus shall be in the sole and absolute discretion of the Board. For the avoidance of doubt, the Executive shall not be eligible for Bonus in calendar years during which the Corporation is not profitable, as determined by the Board.

(c) Automobile Allowance. The Executive shall receive an automobile allowance for lease or purchase of an automobile, including insurance, parking, taxes, fuel, and any other automobile-related expenses, of $1800 per month. This allowance may be increased by the Board but may not be reduced unless there is across-the-board salary and/or expense reduction for other employees of the Corporation.

(d) Change in Control Bonus. In the event of a change in control, pursuant to which there is a change in the majority ownership of the Corporation or a change in the effective control of the Corporation, or a change in the ownership of a substantial portion of the Corporation’s assets, the Corporation shall pay Executive a bonus equal to 104 weeks’ Base Salary within thirty (30) days of the change in control, provided Executive is not terminated with Cause and does not resign prior to date the bonus is scheduled to be paid.

5. Expense Reimbursement and Other Benefits.

(a) Reimbursement of Expenses. Upon the submission of proper substantiation by the Executive, and subject to such rules and guidelines as the Corporation may from time to time adopt, the Corporation shall reimburse the Executive for all reasonable expenses actually paid or incurred by the Executive during the Term of Employment in the course of and pursuant to the business of the Corporation. The Executive shall account to the Corporation in writing for all expenses for which reimbursement is sought and shall supply to the Corporation copies of all relevant invoices, receipts or other evidence reasonably requested by the Corporation.

(b) Compensation/Benefit Programs. During the Term of Employment, the Executive shall be entitled to participate in such medical insurance, Section 125 plans, 401(k) plans, pension and profit-sharing plans and other benefit programs as set forth in any employee handbook of the Corporation or as may be approved from time to time by the Corporation for the benefit of the employees of the Corporation that the Corporation determines to be of similar rank and status to the Executive, subject to the general eligibility and participation provisions set forth in such plans and applicable law.

(c) Vacation and Personal Days. The Executive shall be entitled to 30 vacation and personal days or as may be approved from time to time by the Board.

4

EXECUTION VERSION

6. Termination.

(a) Executive’s employment with the Corporation under this Agreement shall be terminated prior to the end of the Term in accordance with the provisions of this Section 6, (i) automatically on the date of Executive’s death, (ii) at any time by the Corporation in the event of Executive’s Disability, (iii) at any time by the Corporation upon written notice to Executive with or without Cause, or (iv) voluntarily at any time by Executive upon ninety days’ advance written notice to the Corporation.

(b) Termination by the Corporation for Cause, as a result of Death or Disability, or Voluntary Resignation by Executive. If the Corporation terminates this Agreement and Executive’s employment hereunder for Cause, if this Agreement and Executive’s employment hereunder are terminated because of Executive’s death or Disability, or if Executive terminates this Agreement and voluntarily resigns employment hereunder, Executive shall be entitled to receive only the Accrued Rights.

(c) Termination by the Corporation without Cause during Initial Term. If the Corporation terminates this Agreement and Executive’s employment hereunder without Cause (other than by reason of death or Disability) during the Initial Term, Executive shall be entitled to receive only the following: (i) the Accrued Rights; and (2) a severance benefit equal to eighteen (18) months Base Salary, less applicable withholdings, which benefit shall be paid in equal installment payments in accordance with the Corporation’s established payroll procedures, beginning with the first payroll cycle after the thirtieth (30th) day following Executive’s termination date, provided the release referred to in Section 6(e) and a form of which is attached as Exhibit A has been received by the Corporation.

(d) Termination by the Corporation without Cause during Renewal Term. If the Corporation terminates this Agreement and Executive’s employment hereunder without Cause (other than by reason of death or Disability) during any Renewal Term, Executive shall be entitled to receive only the following: (i) the Accrued Rights; and (2) a severance benefit equal to twelve (12) months Base Salary, less applicable withholdings, which benefit shall be paid in equal installment payments in accordance with the Corporation’s established payroll procedures, beginning with the first payroll cycle after the thirtieth (30th) day following Executive’s termination date, provided the release referred to in Section 6(e) and a form of which is attached as Exhibit A has been received by the Corporation.

(e) Any payments due to Executive under Sections 6(b), 6(c) and 6(d) shall be conditioned upon Executive’s execution of a general release of claims in the form agreed to by the Executive and the Corporation and attached hereto as Exhibit A that becomes irrevocable within thirty (30) days of the Termination Date. If the foregoing release is executed and delivered and no longer subject to revocation as provided in the preceding sentence, then such payments or benefits shall be made or commence upon the thirtieth (30^th) day following the Termination Date. The first such cash payment shall include payment of all amounts that otherwise would have been due prior thereto under the terms of this Agreement had such payments commenced immediately upon the Termination Date, and any payments made thereafter shall continue as provided herein.

(f) Board and Officer Resignations. Upon termination of Executive’s employment hereunder for any reason, Executive shall be deemed to have resigned, effective as of the date of such termination and to the extent applicable, from all Board or Officer positions held with the Corporation and any Related Entities.

5

EXECUTION VERSION

(g) Executive’s Continuing Obligations. Termination of Executive’s employment hereunder for any reason shall not terminate Executive’s obligations under Section 7, each of which shall survive such termination.

(h) Assistance by Executive. Following Executive’s termination for any reason, Executive shall provide to the Corporation reasonable levels of assistance in answering questions concerning the business of the Corporation, transition of responsibility, or litigation, provided that all out of pocket expenses Executive reasonably incurs in connection with such assistance shall be fully and promptly reimbursed by the Corporation, and any such assistance shall not interfere or conflict with the obligations which Executive may owe to any other employer.

7. Restrictive Covenants.

(a) Non-Competition. Executive agrees that he will not, directly or indirectly, compete with the Corporation by providing to any company that is in a Competing Business (defined below) anywhere in the United States or anytime during the Term of Employment services substantially similar to the services provided by the Corporation at the time of termination. “Competing Business” means any business operating within the equine industry or in activities related thereto.

(b) Non-Solicitation. Without the written consent of the Corporation, Executive agrees that during the Term of Employment and for a period of two (2) years after the Termination Date, Executive shall not: (a) directly or indirectly induce any customer, client, shareholder, member or investor of the Corporation to participate in any investment opportunity unrelated to the Corporation; (b) directly or indirectly request or advise any customer, client, shareholder, member or investor of the Corporation to withdraw, curtail or cancel their business with the Corporation or interfere, directly or indirectly, with the relationship between the customer, client, shareholder, member or investor and the Corporation in any manner; (c) directly or indirectly disclose to any other person, partnership, corporation or association, the names or addresses of any of the customers, clients, shareholders, members or investors of the Corporation; or (d) induce or attempt to induce any employee, agent or former employee or agent of the Corporation to leave the employ of the Corporation, or hire any such employee, agent or former employee or agent in any business or capacity. Notwithstanding the foregoing, the above subsections (a) — (c) shall only apply to any customer, client, shareholder, member, investor, natural person, company or other entity that qualifies as Confidential Information which, for the avoidance of doubt, includes any information regarding customers, clients, shareholders, members or investors transmitted verbally during discussions between the parties hereto or in writing by the Corporation to the Executive, and vice versa, and excludes a customer, client, shareholder, member or investor, with which or whom the Executive has previously or is currently conducting business including without limitation the parties enumerated on the Annex A hereto. In addition, the above subsection (d) shall not apply to any person responding to any general solicitation for employment such as, but not limited to, newspaper or trade publication advertisements or public job board postings, provided that he or she has not been directly solicited by the Executive or anyone acting as an agent for or on behalf of the Executive.

6

EXECUTION VERSION

(c) Non-Disparagement. During the Term of Employment and for a period of five (5) years after the Termination Date, the Executive agrees not to make or cause to be made, directly or indirectly, any statement to any person disparaging the Corporation or any of its owners, directors, officers, affiliates or executives, or reflecting falsely on the character, business judgment, business practices or business reputation of the Corporation or any of its owners, directors, officers, affiliates or executives except as otherwise required by law or as necessary to enforce the terms of this Agreement or defend a claim regarding the terms of this Agreement.

(d) Confidential Information. Executive agrees that during the Term of Employment and for a period of five (5) years after the Termination Date or as long as the Corporation’s information remains confidential, whichever is longer, the Executive shall not at any time divulge, communicate, use to the detriment of the Corporation or for the benefit of any other person or persons, or misuse in any way, any Confidential Information pertaining to the business of the Corporation. Any Confidential Information or data now or hereafter acquired by the Executive with respect to the business of the Corporation (which shall include, but not be limited to, information concerning the Corporation’s current and potential investor base, including their identities and personal information, and the Corporation’s financial condition, prospects, technology, customers, suppliers, sources of leads and methods of doing business) shall be deemed a valuable, special and unique asset of the Corporation that is received by the Executive in confidence and as a fiduciary, and the Executive shall remain a fiduciary to the Corporation with respect to all of such information. Notwithstanding the foregoing, nothing herein shall be deemed to restrict the Executive from disclosing Confidential Information as required to perform his duties under this Agreement or to the extent required by law. If any person or authority makes a demand on the Executive purporting to legally compel him to divulge any Confidential Information at any time, either during the Term of this Agreement or thereafter, the Executive immediately shall give notice of the demand to the Corporation so that the Corporation may first assess whether to challenge the demand prior to the Executive’s divulging of such Confidential Information. The Executive shall not divulge such Confidential Information until the Corporation either has concluded not to challenge the demand, or has exhausted its challenge, including appeals, if any. Upon request by the Corporation, the Executive shall deliver promptly to the Corporation upon termination of his services for the Corporation, or at any time thereafter as the Corporation may request, all memoranda, notes, records, reports, manuals, drawings, designs, computer files in any media and other documents (and all copies thereof) containing such Confidential Information.

Notwithstanding Executive’s obligations in this Agreement and otherwise, Executive understands that, as provided by the Federal Defend Trade Secrets Act, Executive will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret made: (1) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or (2) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.

8. Representations and Warranties of Executive. The Executive represents and warrants to the Corporation that Executive is free to enter into the Agreement and that Executive has no prior or other obligations or commitments of any kind to anyone that would in any way hinder or interfere with his or her acceptance of, or the full, uninhibited and faithful performance of, Executive’s employment hereunder or the exercise of best efforts as an employee of the Corporation.

7

EXECUTION VERSION

9. Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the internal laws of the State of Florida, without regard to principles of conflict of laws.

10. Jurisdiction and Venue. The parties acknowledge that a substantial portion of the negotiations, anticipated performance and execution of this Agreement occurred or shall occur in Miami-Dade County, Florida, and Broward County, Florida and that, therefore, without limiting the jurisdiction or venue of any other federal or state courts, each of the parties irrevocably and unconditionally (i) agrees that any suit, action or legal proceeding arising out of or relating to this Agreement which is expressly permitted by the terms of this Agreement to be brought in a court of law, shall be brought in the courts of record of the State of Florida in Miami-Dade County, Broward County, or the court of the United States, Southern District of Florida; (ii) consents to the jurisdiction of each such court in any such suit, action or proceeding; (iii) waives any objection which it or he may have to the laying of venue of any such suit, action or proceeding in any of such courts; and (iv) agrees that service of any court papers may be effected on such party by mail, as provided in this Agreement, or in such other manner as may be provided under applicable laws or court rules in such courts.

11. Entire Agreement. This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and, upon its effectiveness, shall supersede all prior agreements, understandings and arrangements, both oral and written, between the Executive and the Corporation (or any of its affiliates) with respect to such subject matter. This Agreement may not be modified in any way unless by a written instrument signed by both the Corporation and the Executive.

12. Survival. The respective rights and obligations of the parties hereunder shall survive any termination of the Executive’s employment hereunder to the extent necessary to the intended preservation of such rights and obligations, including without limitation, Executive’s obligations under Sections 6(h) and 7.

13. Remedies. It is intended that, in view of the nature of the Corporation’s business, the restrictions contained in Section 7 above are considered reasonable and necessary to protect the Corporation’s legitimate business interests and that any violation of these restrictions would result in irreparable injury to the Corporation. In the event of a breach or threatened breach by Executive of any restrictive covenant contained herein, the Corporation shall be entitled to a temporary restraining order and injunctive relief. Nothing contained herein shall be construed as prohibiting the Corporation from pursuing any other remedies available to it for any breach or threatened breach of these restrictive covenants, including, without limitation, the recoupment and other remedies specified in the Agreement. The covenants and restrictions contained in Section 7 shall each be construed as independent of any other provisions in the Agreement, and the existence of any claim or cause of action by Executive against the Corporation, whether predicated on the Agreement or otherwise, shall not constitute a defense to the enforcement by the Corporation of such covenants and restrictions. In the event of the violation by Executive of any of the covenants contained in Section 7, the terms of each such covenant so violated shall be automatically extended from the date on which Executive permanently ceases such violation for a period equal to the period in which Executive was in breach of the covenant or for a period of twelve (12) months from the date of the entry by a court of competent jurisdiction of an order or judgment enforcing such covenant(s), whichever period is later

8

EXECUTION VERSION

14. Notices. All notices required or permitted to be given hereunder shall be in writing and shall be personally delivered by courier, sent by registered or certified mail, return receipt requested or sent by confirmed facsimile transmission addressed as set forth herein. Notices personally delivered, sent by facsimile or sent by overnight courier shall be deemed given on the date of delivery and notices mailed in accordance with the foregoing shall be deemed given upon the earlier of receipt by the addressee, as evidenced by the return receipt thereof, or three (3) days after deposit in the U.S. mail. Notice shall be sent (i) if to the Corporation, addressed to 1740 Grassy Springs Road, Versailles, KY, 40383, and (ii) if to the Executive, to his address as reflected on the payroll records of the Corporation, or to such other address as either party shall request by notice to the other in accordance with this provision.

15. Benefits; Binding Effect. This Agreement shall be for the benefit of and binding upon the parties hereto and their respective heirs, personal representatives, legal representatives, successors and, where permitted and applicable, assigns, including, without limitation, any successor to the Corporation, whether by merger, consolidation, sale of stock, sale of assets or otherwise.

16. Severability. The invalidity of any one or more of the words, phrases, sentences, clauses, provisions, sections or articles contained in this Agreement shall not affect the enforceability of the remaining portions of this Agreement or any part thereof, all of which are inserted conditionally on their being valid in law, and, in the event that any one or more of the words, phrases, sentences, clauses, provisions, sections or articles contained in this Agreement shall be declared invalid, this Agreement shall be construed as if such invalid word or words, phrase or phrases, sentence or sentences, clause or clauses, provisions or provisions, section or sections or article or articles had not been inserted. If such invalidity is caused by length of time or size of area, or both, the otherwise invalid provision will be considered to be reduced to a period or area which would cure such invalidity.

17. Waivers. The waiver by either party hereto of a breach or violation of any term or provision of this Agreement shall not operate nor be construed as a waiver of any subsequent breach or violation.

18. Section Headings. The article, section and paragraph headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

19. No Third Party Beneficiary. Nothing expressed or implied in this Agreement is intended, or shall be construed, to confer upon or give any person other than the Corporation, the parties hereto and their respective heirs, personal representatives, legal representatives, successors and permitted assigns, any rights or remedies under or by reason of this Agreement.

20. Assignment. Neither party may assign or transfer this Agreement or any rights or obligations hereunder without the prior consent of the other party.

9

EXECUTION VERSION

21. Code Section 409A.

(a) General. The intent of the parties is that the payments and benefits under this Agreement comply with or be exempt from Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations and guidance promulgated thereunder (collectively, “Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. Each payment under this Agreement, including each installment payment, shall be considered a separate and distinct payment. For purposes of this agreement, each payment is intended to be excepted from Section 409A to the maximum extent provided as follows: (i) each payment made within the applicable 2½ month period specified in Treas. Reg. § 1.409A-1(b)(4) is intended to be excepted under the short-term deferral exception; (ii) post- termination medical benefits are intended to be excepted under the medical benefits exceptions as specified in Treas. Reg. § 1.409A-1(b)(9)(v)(B); and (iii) to the extent payments are made as a result of an involuntary separation, each payment that is not otherwise excepted under the short- term deferral exception or medical benefits exception is intended to be excepted under the involuntary pay exception as specified in Treas. Reg. § 1.409A-1(b)(9)(iii). The Executive shall have no right to designate the date of any payment under this Agreement. Except as otherwise permitted under Section 409A, no payment hereunder shall be accelerated or deferred unless such acceleration or deferral would not result in additional tax or interest pursuant to Section 409A.

(b) Separation from Service. Notwithstanding anything in this Agreement to the contrary, any compensation or benefits payable under this Agreement that is designated under this Agreement as payable upon Executive’s termination of employment shall be payable only upon Executive’s “separation from service” with the Corporation and all of its controlled group members within the meaning of Section 409A and Treas. Reg. § 1.409A-1(h). Whether Executive has a separation from service will be determined based on all of the facts and circumstances and in accordance with the guidance issued under Section 409A.

(c) Specified Employee. Notwithstanding anything in this Agreement to the contrary, if Executive is deemed by the Corporation at the time of Executive’s Separation from Service to be a “specified employee” for purposes of Section 409A, to the extent delayed commencement of any portion of the benefits to which Executive is entitled under this Agreement is required in order to avoid a prohibited distribution under Section 409A, such portion of Executive’s benefits shall not be provided to Executive prior to the earlier of: (i) the expiration of the six-month period measured from the date of Executive’s Separation from Service with the Corporation or (ii) the date of Executive’s death. Upon the first business day following the expiration of the applicable Section 409A period, all payments deferred pursuant to the preceding sentence shall be paid in a lump sum to Executive (or Executive’s estate or beneficiaries), and any remaining payments due to Executive under this Agreement shall be paid as otherwise provided in this Agreement.

(d) Expense Reimbursements. Except as otherwise expressly provided in this Agreement, all taxable reimbursements of expenses, in-kind benefits and/or cash allowances/premiums provided or paid by the Corporation to the Executive under this Agreement shall be made in accordance with and subject to the following terms and conditions: (i) reimbursements shall only be made to the extent that the expense was actually incurred and reasonably substantiated; (ii) no reimbursement of any expense incurred in one taxable year will affect the amount available for reimbursement in any other taxable year; (iii) reimbursements of eligible expenses shall be made on or before the last day of the Executive's taxable year following the taxable year in which the expense was incurred; and (iv) the right to reimbursement shall not be subject to liquidation or exchange for another benefit. To the extent required by applicable law, the Corporation will annually report as taxable wages and/or impute income to the Executive the value of any taxable benefits and/or payments to the Executive.

10

EXECUTION VERSION

(e) Acknowledgment. Notwithstanding any provision of this Agreement to the contrary, Executive acknowledges and agrees that the Corporation and its employees, officers, directors, and any subsidiaries and affiliates shall not be liable for, and nothing provided or contained in this Agreement will be construed to obligate or cause the Corporation and/or its employees, officers, directors, subsidiaries and affiliates to be liable for, any tax, interest or penalties imposed on Executive related to or arising with respect to any violation of Section 409A.

22. Independent Review by Counsel; Rule of Construction. Corporation and Executive agree that they have mutually prepared this Agreement through the process of negotiation and the involvement, to the extent desired, of independent counsel of their own choice. As such, it will be construed as a whole according to its fair terms. It will not be construed strictly for or against either party as the principal draftsman thereof.

23. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together shall constitute one and the same instrument and agreement.

[signatures on following page]

11

EXECUTION VERSION

IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first above written.

CORPORATION: TROPICAL RACING, INC., a Florida corporation
By:	/s/ Ronald Kapphahn
Name:	Ronald Kapphahn
Title:	Director and Authorized Representative
EXECUTIVE:
/s/ Troy Levy
Troy Levy

[Tropical Racing, Inc. Employment Agreement]

12

EXECUTION VERSION

EXHIBIT A

FORM OF RELEASE

GENERAL RELEASE OF CLAIMS

1. [___________] (“Executive”), for himself and his family, heirs, executors, administrators, legal representatives and their respective successors and assigns, in exchange for the consideration received pursuant to Section Error! Reference source not found. of the Employment Agreement to which this release is attached as Exhibit A (the “Employment Agreement”), does hereby release and forever discharge Tropical Racing, Inc. (the “Corporation”), its subsidiaries, affiliated companies, successors and assigns, and its current or former directors, officers, employees, shareholders or agents in such capacities (collectively with the Corporation, the “Released Parties”) from any and all actions, causes of action, suits, claims and demands whatsoever, for or by reason of any matter, cause or thing whatsoever, whether known or unknown including, but not limited to, all claims under any applicable laws arising under or in connection with Executive’s employment or termination thereof, whether for tort, breach of express or implied employment contract, wrongful discharge, intentional infliction of emotional distress, or defamation or injuries incurred on the job or incurred as a result of loss of employment. Executive acknowledges that the Corporation encouraged him to consult with an attorney of his choosing, and through this General Release of Claims encourages him to consult with his attorney with respect to possible claims under the Age Discrimination in Employment Act (“ADEA”) and that he understands that the ADEA is a Federal statute that, among other things, prohibits discrimination on the basis of age in employment and employee benefits and benefit plans. Without limiting the generality of the release provided above, Executive expressly waives any and all claims under ADEA that he may have as of the date hereof. Executive further understands that by signing this General Release of Claims he is in fact waiving, releasing and forever giving up any claim under the ADEA as well as all other laws within the scope of this paragraph 1 that may have existed on or prior to the date hereof. Notwithstanding anything in this paragraph 1 to the contrary, this General Release of Claims shall not apply to (i) any rights or claims that may arise as a result of events occurring after the date this General Release of Claims is executed, (ii) any indemnification rights Executive may have as a former officer or director of the Corporation or its subsidiaries or affiliated companies and (iii) any claims for benefits under any directors’ and officers’ liability policy maintained by the Corporation or its subsidiaries or affiliated companies in accordance with the terms of such policy.

2. Executive represents that he has not filed against the Released Parties any complaints, charges, or lawsuits arising out of his employment, or any other matter arising on or prior to the date of this General Release of Claims, and covenants and agrees that he will never individually or with any person file, or commence the filing of, any charges, lawsuits, complaints or proceedings with any governmental agency, or against the Released Parties with respect to any of the matters released by Executive pursuant to paragraph 1 hereof (a “Proceeding”); provided, however, Executive shall not have relinquished his right to commence a Proceeding to challenge whether Executive knowingly and voluntarily waived his rights under ADEA.

13

EXECUTION VERSION

3. Executive hereby acknowledges that the Corporation has informed him that he has up to twenty-one (21) days to sign this General Release of Claims and he may knowingly and voluntarily waive that twenty-one (21) day period by signing this General Release of Claims earlier. Executive also understands that he shall have seven (7) days following the date on which he signs this General Release of Claims within which to revoke it by providing a written notice of his revocation to the Corporation.

4. Executive acknowledges that this General Release of Claims will be governed by and construed and enforced in accordance with the internal laws of the State of Florida applicable to contracts made and to be performed entirely within such State.

5. Executive acknowledges that he has read this General Release of Claims, that he has been advised that he should consult with an attorney before he executes this general release of claims, and that he understands all of its terms and executes it voluntarily and with full knowledge of its significance and the consequences thereof.

6. This General Release of Claims shall take effect on the eighth day following Executive’s execution of this General Release of Claims unless Executive’s written revocation is delivered to the Corporation within seven (7) days after such execution.

[__________]

__________________, 20___

_______________

14

EX1A-6 MAT CTRCT.10

EXHIBIT 6.10

GAME OF SILKS, INC.

SERIES SEED PREFERRED STOCK PURCHASE AGREEMENT

October 21, 2021

TABLE OF CONTENTS

		Page
Section 1 Authorization, Sale and Issuance		1
1.1	Authorization	1
1.2	Sale and Issuance of Shares	1
Section 2 Closing Dates and Delivery		1
2.1	Closing	1
2.2	Delivery	2
Section 3 Representations and Warranties of the Company		2
3.1	Organization, Good Standing and Qualification	2
3.2	Subsidiaries	2
3.3	Capitalization	2
3.4	Authorization	3
3.5	Intellectual Property	3
3.6	Title to Properties and Assets; Liens	4
3.7	Compliance with Other Instruments	4
3.8	Litigation	4
3.9	Governmental Consent	4
3.10	Permits	5
3.11	Offering	5
3.12	No Bad Actor Disqualification	5
3.13	Brokers or Finders	5
Section 4 Representations and Warranties of the Investors		5
4.1	No Registration	5
4.2	Investment Intent	5
4.3	Investment Experience	6
4.4	Speculative Nature of Investment	6
4.5	Access to Data	6
4.6	Accredited Investor	6
4.7	Residency	6
4.8	Rule 144	6
4.9	No Public Market	7
4.1	Authorization	7
4.11	Brokers or Finders	7
4.12	Tax Advisors	7
4.13	Legends	8
4.14	No Bad Actor Disqualification Events	8
Section 5 Conditions to Investors Obligations to Close		8
5.1	Representations and Warranties	8
5.2	Covenants	8
5.3	Blue Sky	8
5.4	Certificate of Incorporation	8
5.5	Stockholders Agreement. The Company and each Investor (other than the Investor relying upon this condition to excuse such Purchaser s performance hereunder) shall have executed and delivered the Stockholders Agreement.	8
5.6	Compliance Certificate	9

-i-

TABLE OF CONTENTS

(continued)

Section 6 Conditions to Company s Obligation to Close		9
6.1	Representations and Warranties	9
6.2	Covenants	9
6.3	Compliance with Securities Laws	9
6.4	Certificate of Incorporation	9
6.5	Stockholders Agreement. Each Investor shall have executed and delivered the Stockholders Agreement.	9
Section 7 Certain Restrictions		9
7.1	Restrictions on Transfer	9
7.2	Market Stand-Off Agreement	11
7.3	Delay of Registration	11
Section 8 Miscellaneous		11
8.1	Amendment	11
8.2	Notices	12
8.3	Governing Law	12
8.4	Brokers or Finders	13
8.5	Expenses	13
8.6	Survival	13
8.7	Successors and Assigns	13
8.8	Entire Agreement	13
8.9	Delays or Omissions	13
8.10	Severability	13
8.11	Counterparts	14
8.12	Telecopy Execution and Delivery	14
8.13	Jurisdiction; Venue	14
8.14	Further Assurances	14
8.15	Attorney s Fees	14
8.16	Jury Trial	14

-ii-

EXHIBITS

A	Schedule of Investors
B	Certificate of Incorporation
C	Stockholders Agreement
D	Compliance Certificate

-iii-

GAME OF SILKS, INC.

SERIES Seed PREFERRED STOCK PURCHASE AGREEMENT

This Series Seed Preferred Stock Purchase Agreement (this “Agreement”) is dated as of October 21, 2021, and is between Game of Silks, Inc., a Delaware corporation (the “Company”), and the persons and entities (each, an “Investor” and collectively, the “Investors”) listed on the Schedule of Investors attached as Exhibit A (the “Schedule of Investors”).

SECTION 1

 
AUTHORIZATION, SALE AND ISSUANCE

1.1 Authorization.  The Company has authorized (a) the sale and issuance of up to 3,333,332 shares (the “Shares”) of the Company’s Series Seed Preferred Stock, par value $0.00001 per share (the “Series Seed Preferred”), having the rights, privileges, preferences and restrictions set forth in the amended and restated certificate of incorporation of the Company, in substantially the form of Exhibit B (the “Certificate of Incorporation”) and (b) the reservation of shares of Common Stock for issuance upon conversion of the Shares (the “Conversion Shares”).

1.2 Sale and Issuance of Shares.  Subject to the terms and conditions of this Agreement, each Investor agrees, severally and not jointly, to purchase, and the Company agrees to sell and issue to each Investor, the number of Shares set forth in the column designated “Number of Series Seed Shares” opposite such Investor’s name on the Schedule of Investors, at a cash purchase price of $1.50 per share (the “Purchase Price”). The Company’s agreement with each Investor is a separate agreement, and the sale and issuance of the Shares to each Investor is a separate sale and issuance.

SECTION 2
 
CLOSING DATES AND DELIVERY

2.1 Closing. 

(a) The purchase, sale and issuance of the Shares shall take place at one or more closings (each of which is referred to in this Agreement as a “Closing”). The initial Closing (the “Initial Closing”) shall take place shall take place remotely via the exchange of documents and signatures at 10:00 a.m. Eastern Time on the date of this Agreement, or such other date as the Company and Investors representing a majority of the Shares to be sold in the Initial Closing shall agree.

(b) If less than all of the Shares are sold and issued at the Initial Closing, then, subject to the terms and conditions of this Agreement, the Company may sell and issue at one or more subsequent closings (each, a “Subsequent Closing”), within 75 days after the Initial Closing, up to the balance of the unissued Shares to such persons or entities as may be approved by the Company in its sole discretion; provided, that 400,000 Shares shall be reserved for the issuance and sale to Tropical Racing, Inc. (“Tropical”) at Subsequent Closings, which shall be purchased in two tranches of 200,000 Shares (i) on or before the date that is thirty (30) days following the date hereof and (ii) on or before the date that is sixty (60) days following the date hereof, respectively. In the event that Tropical does not purchase the Shares on or before any such date, the Company may provide notice to Tropical demanding the purchase of such Shares. Upon receipt of such notice, Tropical shall have 10 business days to purchase such Shares and, in the event that Tropical does not purchase such Shares following such 10 business day period, the Company may sell such Shares to any other Purchaser without Tropical’s approval. Any such sale and issuance in a Subsequent Closing shall be on the same terms and conditions as those contained herein, and such persons or entities shall, upon execution and delivery of the relevant signature pages, become parties to, and be bound by, this Agreement and that certain Stockholders Agreement, dated as of October 18, 2021, by and among the Company, the Investors, and certain other stockholders of the Company, attached hereto as Exhibit C (as may be amended and/or amended and restated from time to time, the “Stockholders Agreement”) without the need for an amendment to this Agreement except to add such person’s or entity’s name to the Schedule of Investors, and shall have the rights and obligations of an Investor hereunder as of the date of the applicable Subsequent Closing. Each Subsequent Closing shall take place at such date, time and place as shall be approved by the Company and the Investors representing a majority of the Shares to be sold in such Subsequent Closing.

(c) Immediately after each Closing, the Schedule of Investors will be amended to list the Investors purchasing Shares hereunder and the number of Shares issued to each Investor hereunder at each such Closing.

-1-

2.2 Delivery. Following each Closing, the Company will deliver to each Investor in such Closing a certificate registered in such Investor’s name representing the number of Shares that such Investor is purchasing in such Closing (or such other representation of their ownership if shares are uncertificated) against payment of the purchase price therefor as set forth in the column designated “Purchase Price” opposite such Investor’s name on the Schedule of Investors, by (a) check payable to the Company, (b) wire transfer in accordance with the Company’s instructions, (c) cancellation of indebtedness or (d) any combination of the foregoing. In the event that payment by an Investor is made, in whole or in part, by cancellation of indebtedness, then such Investor shall surrender to the Company for cancellation at the Closing any evidence of indebtedness or shall execute an instrument of cancellation in form and substance acceptable to the Company.

SECTION 3
 
REPRESENTATIONS AND WARRANTIES OF THE COMPANY

The Company hereby represents and warrants to the Investors as of the Closing as follows:

3.1 Organization, Good Standing and Qualification. The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. The Company has the requisite corporate power and authority to own and operate its properties and assets, to carry on its business as presently conducted, to execute and deliver the Agreements, to issue and sell the Shares and the Conversion Shares and to perform its obligations pursuant to the Agreements and the Certificate of Incorporation. The Company is presently qualified to do business as a foreign corporation in each jurisdiction where the failure to be so qualified could reasonably be expected to have a material adverse effect on the Company’s financial condition or business as now conducted (a “Material Adverse Effect”).

3.2 Subsidiaries. The Company does not own or control, directly or indirectly, any interest in any corporation, partnership, limited liability company, association or other business entity.

3.3 Capitalization.

(a) Immediately prior to the Initial Closing, the authorized capital stock of the Company will consist of 15,500,000 shares of Common Stock, of which 10,000,000 shares are issued and outstanding and 3,333,332 shares of Preferred Stock, all of which are designated Series Seed Preferred and none of which are issued and outstanding. The Common Stock and the Series Seed Preferred shall have the rights, preferences, privileges and restrictions set forth in the Certificate of Incorporation.

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(b) The outstanding shares have been duly authorized and validly issued in compliance with applicable laws, and are fully paid and nonassessable.

(c) The Company has reserved:

(i) the Shares for issuance pursuant to this Agreement;

(ii) shares of Common Stock (as may be adjusted in accordance with the provisions of the Certificate of Incorporation) for issuance upon conversion of the Shares; and

(iii) 1,500,000 shares of Common Stock for issuance to officers, directors, employees and consultants of the Company pursuant to its 2021 Equity Incentive Plan duly adopted by the Board of Directors and approved by the Company stockholders (the “Stock Plan”);

(d) All issued and outstanding shares of the Company’s Common Stock (i) have been duly authorized and validly issued and are fully paid and nonassessable, and (ii) were issued in compliance with all applicable state and federal laws concerning the issuance of securities.

(e) The Shares, when issued and delivered and paid for in compliance with the provisions of this Agreement, will be validly issued, fully paid and nonassessable. The Conversion Shares have been duly and validly reserved and, when issued in compliance with the provisions of this Agreement, the Certificate of Incorporation and applicable law, will be validly issued, fully paid and nonassessable. The Shares and the Conversion Shares will be free of any liens or encumbrances, other than any liens or encumbrances created by or imposed upon the Investors; provided, however, that the Shares and the Conversion Shares are subject to restrictions on transfer under U.S. state and/or federal securities laws and as set forth herein. The Shares and the Conversion Shares are not subject to any preemptive rights or rights of first refusal.

(f) Except for the conversion privileges of the Series Seed Preferred or as otherwise described in this Agreement, there are no options, warrants or other rights to purchase any of the Company’s authorized and unissued capital stock, other than as set forth in the Stockholders Agreement.

3.4 Authorization. All corporate action on the part of the Company and its directors, officers and stockholders necessary for the authorization, execution and delivery of the Agreements by the Company, the authorization, sale, issuance and delivery of the Shares and the Conversion Shares, and the performance of all of the Company’s obligations under the Agreements has been taken or will be taken prior to the Initial Closing. The Agreements, when executed and delivered by the Company, shall constitute valid and binding obligations of the Company, enforceable in accordance with their terms, except (i) as limited by laws of general application relating to bankruptcy, insolvency and the relief of debtors, and (ii) as limited by rules of law governing specific performance, injunctive relief or other equitable remedies and by general principles of equity.

3.5 Intellectual Property.  

(a) Intellectual Property Rights. Neither the operations of the Company as currently conducted nor any product or service of the Company infringes or violates any patent, copyright, trademark, trade secret or other intellectual property rights (“Intellectual Property”) of any third party, provided that the foregoing representation is made to the knowledge of the Company (without having conducted any special investigation or patent search) with respect to patents. The Company has not received any communication alleging, or that would put the Company on notice, that the Company is or may be infringing or violating any of the Intellectual Property of any other person or entity.

(b) Proprietary Information and Invention Assignment. Each person that was or is an officer or employee of the Company has executed a confidential information and invention assignment agreement.

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3.6 Title to Properties and Assets; Liens. The Company has good and marketable title to its properties and assets, and has good title to all its leasehold interests, in each case subject to no material mortgage, pledge, lien, lease, encumbrance or charge, other than (i) liens for current taxes not yet due and payable, (ii) liens imposed by law and incurred in the ordinary course of business for obligations not past due, (iii) liens in respect of pledges or deposits under workers’ compensation laws or similar legislation, and (iv) liens, encumbrances and defects in title which do not in any case materially detract from the value of the property subject thereto or have a Material Adverse Effect, and which have not arisen otherwise than in the ordinary course of business. With respect to the property and assets it leases, the Company is in compliance with such leases in all material respects and, to its knowledge, holds a valid leasehold interest free of any liens, claims or encumbrances, subject to clauses (i)-(iv) above.

3.7 Compliance with Other Instruments. The Company is not in violation of any material term of its certificate of incorporation or bylaws, each as amended to date, or, to the Company’s knowledge, in any material respect of any term or provision of any material mortgage, indebtedness, indenture, contract, agreement, instrument, judgment, order or decree to which it is party or by which it is bound which would have a Material Adverse Effect. To the Company’s knowledge, the Company is not in violation of any federal or state statute, rule or regulation applicable to the Company the violation of which would have a Material Adverse Effect. The execution and delivery of the Agreements by the Company, the performance by the Company of its obligations pursuant to the Agreements, and the issuance of the Shares and the Conversion Shares, will not result in any material violation of, or materially conflict with, or constitute a material default under, the Company’s certificate of incorporation or bylaws, each as amended to date, or any of its agreements, nor, to the Company’s knowledge, result in the creation of any material mortgage, pledge, lien, encumbrance or charge upon any of the properties or assets of the Company.

3.8 Litigation. There are no actions, suits, proceedings or investigations pending against the Company or its properties (nor has the Company received written notice of any threat thereof) before any court or governmental agency that questions the validity of the Agreements or the right of the Company to enter into them, or the right of the Company to perform its obligations contemplated thereby, or that, either individually or in the aggregate, if determined adversely to the Company, would or could reasonably be expected to have a Material Adverse Effect or result in any change in the current equity ownership of the Company. The Company is not a party or subject to the provisions of any order, writ, injunction, judgment or decree of any court or government agency or instrumentality.

3.9 Governmental Consent. No consent, approval or authorization of or designation, declaration or filing with any governmental authority on the part of the Company is required in connection with the valid execution and delivery of this Agreement, or the offer, sale or issuance of the Shares and the Conversion Shares, or the consummation of any other transaction contemplated by this Agreement, except (i) filing of the Certificate of Incorporation with the office of the Secretary of State of the State of Delaware, (ii) the filing of such notices as may be required under the Securities Act of 1933, as amended (the “Securities Act”) and (iii) such filings as may be required under applicable state securities laws.

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3.10 Permits. The Company has all franchises, permits, licenses, and any similar authority necessary for the conduct of its business as now being conducted by it, the lack of which would have a Material Adverse Effect, and believes it can obtain, without undue burden or expense, any similar authority for the conduct of its business as presently planned to be conducted. The Company is not in default in any material respect under any of such franchises, permits, licenses or other similar authority.

3.11 Offering. Subject to the accuracy of the Investors’ representations and warranties in Section 4, the offer, sale and issuance of the Shares to be issued in conformity with the terms of this Agreement and the issuance of the Conversion Shares, constitute transactions exempt from the registration requirements of Section 5 of the Securities Act.

3.12 No “Bad Actor” Disqualification. The Company has exercised reasonable care, in accordance with SEC rules and guidance, to determine whether any Covered Person (as defined below) is subject to any of the “bad actor” disqualifications described in Rule 506(d)(1)(i) through (viii) under the Securities Act (“Disqualification Events”). To the Company’s knowledge, no Covered Person is subject to a Disqualification Event, except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3) under the Securities Act. The Company has complied, to the extent applicable, with any disclosure obligations under Rule 506(e) under the Securities Act. “Covered Persons” are those persons specified in Rule 506(d)(1) under the Securities Act, including the Company; any predecessor or affiliate of the Company; any director, executive officer, other officer participating in the offering, general partner or managing member of the Company; any beneficial owner of 20% or more of the Company’s outstanding voting equity securities, calculated on the basis of voting power; any promoter (as defined in Rule 405 under the Securities Act) connected with the Company in any capacity at the time of the sale of the Shares; and any person that has been or will be paid (directly or indirectly) remuneration for solicitation of purchasers in connection with the sale of the Shares (a “Solicitor”), any general partner or managing member of any Solicitor, and any director, executive officer or other officer participating in the offering of any Solicitor or general partner or managing member of any Solicitor.

3.13 Brokers or Finders. The Company has not incurred, and will not incur, directly or indirectly, as a result of any action taken by the Company, any liability for brokerage or finders’ fees or agents’ commissions or any similar charges in connection with this Agreement or any of the transactions contemplated hereby.

SECTION 4
REPRESENTATIONS AND WARRANTIES OF THE INVESTORS

Each Investor hereby, severally and not jointly, represents and warrants to the Company as follows:

4.1 No Registration. The Investor understands that the Shares and the Conversion Shares, have not been, and will not be, registered under the Securities Act by reason of a specific exemption from the registration provisions of the Securities Act, the availability of which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of the Investor’s representations as expressed herein or otherwise made pursuant hereto.

4.2 Investment Intent. The Investor is acquiring the Shares and the Conversion Shares for investment for its own account, not as a nominee or agent, and not with the view to, or for resale in connection with, any distribution thereof, and that the Investor has no present intention of selling, granting any participation in, or otherwise distributing the same. The Investor further represents that it does not have any contract, undertaking, agreement or arrangement with any person or entity to sell, transfer or grant participation to such person or entity or to any third person or entity with respect to any of the Shares or the Conversion Shares.

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4.3 Investment Experience. The Investor has substantial experience in evaluating and investing in private placement transactions of securities in companies similar to the Company and acknowledges that the Investor can protect its own interests. The Investor has such knowledge and experience in financial and business matters so that the Investor is capable of evaluating the merits and risks of its investment in the Company.

4.4 Speculative Nature of Investment. The Investor understands and acknowledges that the Company has a limited financial and operating history and that an investment in the Company is highly speculative and involves substantial risks. The Investor can bear the economic risk of the Investor’s investment and is able, without impairing the Investor’s financial condition, to hold the Shares and the Conversion Shares for an indefinite period of time and to suffer a complete loss of the Investor’s investment.

4.5 Access to Data. The Investor has had an opportunity to ask questions of, and receive answers from, the officers of the Company concerning the Agreements, the exhibits and schedules attached hereto and thereto and the transactions contemplated by the Agreements, as well as the Company’s business, management and financial affairs, which questions were answered to its satisfaction. The Investor believes that it has received all the information the Investor considers necessary or appropriate for deciding whether to purchase the Shares and the Conversion Shares. The Investor understands that such discussions, as well as any information issued by the Company, were intended to describe certain aspects of the Company’s business and prospects, but were not necessarily a thorough or exhaustive description. The Investor acknowledges that any business plans prepared by the Company have been, and continue to be, subject to change and that any projections included in such business plans or otherwise are necessarily speculative in nature, and it can be expected that some or all of the assumptions underlying the projections will not materialize or will vary significantly from actual results. The Investor also acknowledges that it is relying solely on its own counsel and not on any statements or representations of the Company or its agents for legal advice with respect to this investment or the transactions contemplated by the Agreements.

4.6 Accredited Investor. The Investor is an “accredited investor” within the meaning of Regulation D, Rule 501(a), promulgated by the Securities and Exchange Commission under the Securities Act and shall submit to the Company such further assurances of such status as may be reasonably requested by the Company. The Investor has furnished or made available any and all information requested by the Company or otherwise necessary to satisfy any applicable verification requirements as to “accredited investor” status. Any such information is true, correct, timely and complete.

4.7 Residency. The residency of the Investor (or, in the case of a partnership or corporation, such entity’s principal place of business) is correctly set forth on the Schedule of Investors.

4.8 Rule 144. The Investor acknowledges that the Shares and the Conversion Shares must be held indefinitely unless subsequently registered under the Securities Act or an exemption from such registration is available. The Investor is aware of the provisions of Rule 144 promulgated under the Securities Act which permit resale of shares purchased in a private placement subject to the satisfaction of certain conditions, which may include, among other things, the availability of certain current public information about the Company; the resale occurring not less than a specified period after a party has purchased and paid for the security to be sold; the number of shares being sold during any three-month period not exceeding specified limitations; the sale being effected through a “brokers’ transaction,” a transaction directly with a “market maker” or a “riskless principal transaction” (as those terms are defined in the Securities Act or the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder); and the filing of a Form 144 notice, if applicable. The Investor understands that the current public information referred to above is not now available and the Company has no present plans to make such information available. The Investor acknowledges and understands that notwithstanding any obligation under this Agreement, the Company may not be satisfying the current public information requirement of Rule 144 at the time the Investor wishes to sell the Shares or the Conversion Shares, and that, in such event, the Investor may be precluded from selling such securities under Rule 144, even if the other applicable requirements of Rule 144 have been satisfied. The Investor acknowledges that, in the event the applicable requirements of Rule 144 are not met, registration under the Securities Act or an exemption from registration will be required for any disposition of the Shares or the underlying Common Stock. The Investor understands that, although Rule 144 is not exclusive, the Securities and Exchange Commission has expressed its opinion that persons proposing to sell restricted securities received in a private offering other than in a registered offering or pursuant to Rule 144 will have a substantial burden of proof in establishing that an exemption from registration is available for such offers or sales and that such persons and the brokers who participate in the transactions do so at their own risk.

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4.9 No Public Market. The Investor understands and acknowledges that no public market now exists for any of the securities issued by the Company and that the Company has made no assurances that a public market will ever exist for the Company’s securities.

4.10 Authorization.

(a) The Investor has all requisite power and authority to execute and deliver the Agreements, to purchase the Shares hereunder and to carry out and perform its obligations under the terms of the Agreements. All action on the part of the Investor necessary for the authorization, execution, delivery and performance of the Agreements, and the performance of all of the Investor’s obligations under the Agreements, has been taken or will be taken prior to the Closing.

(b) The Agreements, when executed and delivered by the Investor, will constitute valid and legally binding obligations of the Investor, enforceable in accordance with their terms except: (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, and (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies or by general principles of equity.

(c) No consent, approval, authorization, order, filing, registration or qualification of or with any court, governmental authority or third person is required to be obtained by the Investor in connection with the execution and delivery of the Agreements by the Investor or the performance of the Investor’s obligations hereunder or thereunder.

4.11 Brokers or Finders. The Investor has not engaged any brokers, finders or agents, and neither the Company nor any other Investor has, nor will, incur, directly or indirectly, as a result of any action taken by the Investor, any liability for brokerage or finders’ fees or agents’ commissions or any similar charges in connection with the Agreements.

4.12 Tax Advisors. The Investor has reviewed with its own tax advisors the U.S. federal, state, local and foreign tax consequences of this investment and the transactions contemplated by the Agreements. With respect to such matters, the Investor relies solely on such advisors and not on any statements or representations of the Company or any of its agents, written or oral. The Investor understands that it (and not the Company) shall be responsible for its own tax liability that may arise as a result of this investment or the transactions contemplated by the Agreements.

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4.13 Legends. The Investor understands and agrees that the certificates evidencing the Shares or the Conversion Shares, or any other securities issued in respect of the Shares or the Conversion Shares upon any stock split, stock dividend, recapitalization, merger, consolidation or similar event, shall bear the following legend (in addition to any legend required by this Agreement or under applicable state securities laws):

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SUCH ACT AND/OR APPLICABLE STATE SECURITIES LAWS, OR UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL OR OTHER EVIDENCE, REASONABLY SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.”

4.14 No “Bad Actor” Disqualification Events. Neither (i) the Investor, (ii) any of its directors, executive officers, other officers that may serve as a director or officer of any company in which it invests, general partners or managing members, nor (iii) any beneficial owner of the Company’s voting equity securities (in accordance with Rule 506(d) of the Securities Act) held by the Investor is subject to any Disqualification Event (as defined in Section 3.12), except for Disqualification Events covered by Rule 506(d)(2)(ii) or (iii) or (d)(3) under the Securities Act and disclosed reasonably in advance of the Closing in writing in reasonable detail to the Company.

SECTION 5

CONDITIONS TO INVESTORS’ OBLIGATIONS TO CLOSE

Each Investor’s obligation to purchase the Shares at a Closing is subject to the fulfillment on or before the Closing of each of the following conditions, unless waived in writing by the applicable Investor purchasing the Shares in such Closing:

5.1 Representations and Warranties. The representations and warranties made by the Company in Section 3 shall be true and correct in all material respects as of the date of the Closing.

5.2 Covenants. The Company shall have performed or complied with all covenants, agreements and conditions contained in this Agreement to be performed or complied with by the Company on or prior to the Closing in all material respects.

5.3 Blue Sky. The Company shall have obtained all necessary Blue Sky law permits and qualifications, or have the availability of exemptions therefrom, required by any state for the offer and sale of the Shares and the Conversion Shares.

5.4 Certificate of Incorporation. The Certificate of Incorporation shall have been duly authorized, executed and filed with and accepted by the Secretary of State of the State of Delaware.

5.5 Stockholders Agreement. The Company and each Investor (other than the Investor relying upon this condition to excuse such Purchaser’s performance hereunder) shall have executed and delivered the Stockholders Agreement.

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5.6 Compliance Certificate. The Company shall have delivered to counsel to the Investors a certificate executed by the Chief Executive Officer, President or Chief Financial Officer of the Company on behalf of the Company, in substantially the form of Exhibit D, certifying the satisfaction of the conditions to closing listed in Sections 5.1 and 5.2.

SECTION 6

CONDITIONS TO COMPANY’S OBLIGATION TO CLOSE

The Company’s obligation to sell and issue the Shares at each Closing is subject to the fulfillment on or before such Closing of the following conditions, unless waived in writing by the Company:

6.1 Representations and Warranties. The representations and warranties made by the Investors in such Closing in Section 4 shall be true and correct when made and shall be true and correct as of the date of such Closing.

6.2 Covenants. The Investors shall have performed or complied with all covenants, agreements and conditions contained in the Agreements to be performed or complied with by the Investors on or prior to the date of such Closing.

6.3 Compliance with Securities Laws. The Company shall be satisfied that the offer and sale of the Shares and the Conversion Shares shall be qualified or exempt from registration or qualification under all applicable federal and state securities laws (including receipt by the Company of all necessary blue sky law permits and qualifications required by any state, if any).

6.4 Certificate of Incorporation. The Certificate of Incorporation shall have been duly authorized, executed and filed with and accepted by the Secretary of State of the State of Delaware.

6.5 Stockholders Agreement. Each Investor shall have executed and delivered the Stockholders Agreement.

SECTION 7

 
CERTAIN RESTRICTIONS

7.1 Restrictions on Transfer.

(a) The holder (each a “Holder”) of each certificate representing Shares or Conversion Shares (such Shares or Conversion Shares, the “Securities”) by acceptance thereof agrees to comply in all respects with the provisions of this Section 7. Each Holder agrees not to make any sale, assignment, transfer, pledge or other disposition of all or any portion of the Securities, or any beneficial interest therein, unless and until the transferee thereof has agreed in writing for the benefit of the Company to take and hold such Securities subject to, and to be bound by, the terms and conditions set forth in this Agreement, including, without limitation, this Section 7, and:

(i) There is then in effect a registration statement under the Securities Act covering such proposed disposition and the disposition is made in accordance with the registration statement; or

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(ii) The Holder shall have given prior written notice to the Company of the Holder’s intention to make such disposition and shall have furnished the Company with a detailed description of the manner and circumstances of the proposed disposition, and, if requested by the Company, the Holder shall have furnished the Company, at the Holder’s expense, with (i) an opinion of counsel reasonably satisfactory to the Company to the effect that such disposition will not require registration of such Securities under the Securities Act or (ii) a “no action” letter from the Securities and Exchange Commission or any other federal agency at the time administering the Securities Act (the “Commission”) to the effect that the transfer of such securities without registration will not result in a recommendation by the staff of the Commission that action be taken with respect thereto, whereupon the holder of such Securities shall be entitled to transfer such Securities in accordance with the terms of the notice delivered by the Holder to the Company. It is agreed that the Company will not require opinions of counsel for transactions made pursuant to Rule 144, except in unusual circumstances.

(b) Notwithstanding the provisions of Section 7.1, no such registration statement, opinion of counsel or “no action” letter shall be necessary for (i) a transfer not involving a change in beneficial ownership, or (ii) transactions involving the distribution without consideration of Securities by any Holder to (x) a parent, subsidiary or other affiliate of the Holder, if the Holder is a corporation, (y) any of the Holder’s partners, members or other equity owners, or retired partners, retired members or other equity owners, or to the estate of any of the Holder’s partners, members or other equity owners or retired partners, retired members or other equity owners, or (z) a venture capital fund that is controlled by or under common control with one or more general partners or managing members of, or shares the same management company with, the Holder; provided, in each case, that the Holder shall give written notice to the Company of the Holder’s intention to effect such disposition and shall have furnished the Company with a detailed description of the manner and circumstances of the proposed disposition.

(c) Each Investor agrees not to make any sale, assignment, transfer, pledge or other disposition of any securities of the Company, or any beneficial interest therein, to any person other than the Company unless and until the proposed transferee confirms to the reasonable satisfaction of the Company that neither the proposed transferee nor any of its directors, executive officers, other officers that may serve as a director or officer of any company in which it invests, general partners or managing members nor any person that would be deemed a beneficial owner of those securities (in accordance with Rule 506(d) of the Securities Act) is subject to any Disqualification Events, except as set forth in Rule 506(d)(2)(ii) or (iii) or (d)(3) under the Securities Act and disclosed, reasonably in advance of the transfer, in writing in reasonable detail to the Company.

(d) The Company shall not be obligated to recognize any attempted sale, assignment, transfer, pledge or other disposition of all or any portion of the Securities, or any beneficial interest therein, made other than in compliance with the terms and conditions of this Agreement. The Holders consent to the Company making a notation on its records and giving instructions to any transfer agent of the Securities in order to implement the restrictions on transfer established in this Agreement.

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7.2 Market Stand-Off Agreement. 

(a) Each Holder shall not sell or otherwise transfer, make any short sale of, grant any option for the purchase of, or enter into any hedging or similar transaction with the same economic effect as a sale, of any Common Stock (or other securities) of the Company held by such Holder (other than those included in the registration) during the period from the filing of the registration statement for the Company’s first public offering filed under the Securities Act that includes securities to be sold on behalf of the Company to the public in an underwritten public offering under the Securities Act through the end of the 180-day period following the effective date of the registration statement (or such other period as may be requested by the Company or an underwriter to accommodate regulatory restrictions on (i) the publication or other distribution of research reports and (ii) analyst recommendations and opinions, including, but not limited to, the restrictions contained in NYSE Rule 472(f)(4), or any successor provisions or amendments thereto), provided that: all officers and directors of the Company are bound by and have entered into similar agreements and the Company uses commercially reasonable efforts to cause holders of at least one percent (1%) of the Company’s voting securities to enter into and be bound by similar agreements. The obligations described in this Section 7.2 shall not apply to a registration relating solely to employee benefit plans on Form S-l or Form S-8 or similar forms that may be promulgated in the future, or a registration relating solely to a transaction on Form S-4 or similar forms that may be promulgated in the future. The Company may impose stop-transfer instructions and may stamp each such certificate with the legend set forth in Section 7.2(b) with respect to the shares of Common Stock (or other securities) subject to the foregoing restriction until the end of such one hundred eighty (180) day (or other) period. Each Holder agrees to execute a market standoff agreement with said underwriters in customary form consistent with the provisions of this Section 7.2(a).

(b) Each certificate representing Securities shall be stamped or otherwise imprinted with a legend substantially similar to the following (in addition to any legend required under applicable state securities laws):

“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE, INCLUDING A LOCK-UP PERIOD IN THE EVENT OF A PUBLIC OFFERING, AS SET FORTH IN A Series Seed Preferred Stock Purchase AGREEMENT AMONG THE COMPANY AND THE ORIGINAL HOLDERS OF THESE SHARES, COPIES OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE COMPANY.”

7.3 Delay of Registration.  No Holder shall have any right to take any action to restrain, enjoin, or otherwise delay any registration as the result of any controversy that might arise with respect to the interpretation or implementation of this Section 7.

SECTION 8

MISCELLANEOUS

8.1 Amendment.  Except as expressly provided herein, neither this Agreement nor any term hereof may be amended, waived, discharged or terminated other than by a written instrument referencing this Agreement and signed by the Company and the Investors holding a majority of the Common Stock issued or issuable upon conversion of the Shares issued pursuant to this Agreement (excluding any of such shares that have been sold to the public or pursuant to Rule 144); provided, however, that Investors purchasing shares in a Closing after the Initial Closing may become parties to this Agreement in accordance with Section 2.1 without any amendment of this Agreement pursuant to this paragraph or any consent or approval of any other Investor; and provided, further, that if any amendment, waiver, discharge or termination operates in a manner that treats any Investor different from other Investors, the consent of such Investor shall also be required for such amendment, waiver, discharge or termination. Any such amendment, waiver, discharge or termination effected in accordance with this paragraph shall be binding upon each holder of any securities purchased under this Agreement at the time outstanding (including securities into which such securities have been converted or exchanged or for which such securities have been exercised) and each future holder of all such securities. Each Investor acknowledges that by the operation of this paragraph, the holders of a majority of the Common Stock issued or issuable upon conversion of the Shares issued pursuant to this Agreement (excluding any of such shares that have been sold to the public or pursuant to Rule 144) will have the right and power to diminish or eliminate all rights of such Investor under this Agreement.

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8.2 Notices. All notices and other communications required or permitted hereunder shall be in writing and shall be mailed by registered or certified mail, postage prepaid, sent by facsimile or electronic mail (if to an Investor or any other holder of Company securities) or otherwise delivered by hand, messenger or courier service addressed:

(a) if to an Investor, to the Investor’s address, facsimile number or electronic mail address as shown in the Company’s records, as may be updated in accordance with the provisions hereof;

(b) if to any other holder of any Shares or Conversion Shares, to such address, facsimile number or electronic mail address as shown in the Company’s records, or, until any such holder so furnishes an address, facsimile number or electronic mail address to the Company, then to the address of the last holder of such Shares or Conversion Shares for which the Company has contact information in its records; or

(c) if to the Company, to the attention of the Chief Executive Officer or Chief Financial Officer of the Company at 5550 Glades Road #532, Boca Raton, FL 33431, or at such other current address as the Company shall have furnished to the Investors, with a copy (which shall not constitute notice) to Greenberg Traurig, P.A., 401 East Las Olas Boulevard, Suite 2000, Fort Lauderdale, FL 33301, Attention: Rebecca G. DiStefano, Email: distefanor@gtlaw.com.

Each such notice or other communication shall for all purposes of this Agreement be treated as effective or having been given (i) if delivered by hand, messenger or courier service, when delivered (or if sent via a nationally-recognized overnight courier service, freight prepaid, specifying next-business-day delivery, one business day after deposit with the courier), or (ii) if sent via mail, at the earlier of its receipt or five days after the same has been deposited in a regularly-maintained receptacle for the deposit of the United States mail, addressed and mailed as aforesaid, or (iii) if sent via facsimile, upon confirmation of facsimile transfer or, if sent via electronic mail, upon confirmation of delivery when directed to the relevant electronic mail address, if sent during normal business hours of the recipient, or if not sent during normal business hours of the recipient, then on the recipient’s next business day. In the event of any conflict between the Company’s books and records and this Agreement or any notice delivered hereunder, the Company’s books and records will control absent fraud or error.

Subject to the limitations set forth in Delaware General Corporation Law §232(e), each Investor or other security holder consents to the delivery of any notice to stockholders given by the Company under the Delaware General Corporation Law or the Company’s certificate of incorporation or bylaws by (i) facsimile telecommunication to the facsimile number set forth on Exhibit A (or to any other facsimile number for the Investor or other security holder in the Company’s records), (ii) electronic mail to the electronic mail address set forth on Exhibit A (or to any other electronic mail address for the Investor or other security holder in the Company’s records), (iii) posting on an electronic network together with separate notice to the Investor or other security holder of such specific posting or (iv) any other form of electronic transmission (as defined in the Delaware General Corporation Law) directed to the Investor or other security holder. This consent may be revoked by an Investor or other security holder by written notice to the Company and may be deemed revoked in the circumstances specified in Delaware General Corporation Law §232.

8.3 Governing Law. This Agreement shall be governed in all respects by the internal laws of the State of Delaware as applied to agreements entered into among Delaware residents to be performed entirely within Delaware, without regard to principles of conflicts of law.

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8.4 Brokers or Finders. The Company shall indemnify and hold harmless each Investor from any liability for any commission or compensation in the nature of a brokerage or finder’s fee or agent’s commission (and the costs and expenses of defending against such liability or asserted liability) for which such Investor or any of its constituent partners, members, officers, directors, employees or representatives is responsible to the extent such liability is attributable to any inaccuracy or breach of the representations and warranties contained in Section 3.13, and each Investor agrees to indemnify and hold harmless the Company and each other Investor from any liability for any commission or compensation in the nature of a brokerage or finder’s fee or agent’s commission (and the costs and expenses of defending against such liability or asserted liability) for which the Company, any other Investor or any of their constituent partners, members, officers, directors, employees or representatives is responsible to the extent such liability is attributable to any inaccuracy or breach of the representations and warranties contained in Section 4.11.

8.5 Expenses. The Company and the Investors shall each pay their own expenses in connection with the transactions contemplated by this Agreement.

8.6 Survival. The representations, warranties, covenants and agreements made in this Agreement shall survive any investigation made by any party hereto and the closing of the transactions contemplated hereby.

8.7 Successors and Assigns. This Agreement, and any and all rights, duties and obligations hereunder, shall not be assigned, transferred, delegated or sublicensed by any Investor without the prior written consent of the Company. Any attempt by an Investor without such permission to assign, transfer, delegate or sublicense any rights, duties or obligations that arise under this Agreement shall be void. Subject to the foregoing and except as otherwise provided herein, the provisions of this Agreement shall inure to the benefit of, and be binding upon, the successors, assigns, heirs, executors and administrators of the parties hereto.

8.8 Entire Agreement. This Agreement, including the exhibits attached hereto, constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and thereof. No party shall be liable or bound to any other party in any manner with regard to the subjects hereof or thereof by any warranties, representations or covenants except as specifically set forth herein or therein.

8.9 Delays or Omissions. Except as expressly provided herein, no delay or omission to exercise any right, power or remedy accruing to any party to this Agreement upon any breach or default of any other party under this Agreement shall impair any such right, power or remedy of such non-defaulting party, nor shall it be construed to be a waiver of any such breach or default, or an acquiescence therein, or of or in any similar breach or default thereafter occurring, nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the part of any party of any breach or default under this Agreement, or any waiver on the part of any party of any provisions or conditions of this Agreement, must be in writing and shall be effective only to the extent specifically set forth in such writing. All remedies, either under this Agreement or by law or otherwise afforded to any party to this Agreement, shall be cumulative and not alternative.

8.10 Severability.  If any provision of this Agreement becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable or void, portions of such provision, or such provision in its entirety, to the extent necessary, shall be severed from this Agreement, and such court will replace such illegal, void or unenforceable provision of this Agreement with a valid and enforceable provision that will achieve, to the extent possible, the same economic, business and other purposes of the illegal, void or unenforceable provision. The balance of this Agreement shall be enforceable in accordance with its terms.

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8.11 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be enforceable against the parties actually executing such counterparts, and all of which together shall constitute one instrument.

8.12 Telecopy Execution and Delivery. A facsimile, telecopy or other reproduction of this Agreement may be executed by one or more parties hereto and delivered by such party by facsimile or any similar electronic transmission device pursuant to which the signature of or on behalf of such party can be seen. Such execution and delivery shall be considered valid, binding and effective for all purposes. At the request of any party hereto, all parties hereto agree to execute and deliver an original of this Agreement as well as any facsimile, telecopy or other reproduction hereof.

8.13 Jurisdiction; Venue. The parties, by their execution of this Agreement, hereby irrevocably submit to the in persona jurisdiction of the state courts of the State of Florida and of the United States District Courts that are located in Palm Beach County, Florida, for the purpose of any suit, action or other proceeding arising out of or based upon this Agreement.

8.14 Further Assurances. Each party hereto agrees to execute and deliver, by the proper exercise of its corporate, limited liability company, partnership or other powers, all such other and additional instruments and documents and do all such other acts and things as may be necessary to more fully effectuate this Agreement.

8.15 Attorney’s Fees. In the event that any suit or action is instituted to enforce any provisions in this Agreement, the prevailing party in such dispute shall be entitled to recover from the losing party such reasonable fees and expenses of attorneys and accountants, which shall include, without limitation, all fees, costs and expenses of appeals.

8.16 Jury Trial. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING (WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATED TO THIS AGREEMENT.

(signature page follows)

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The parties are signing this Series Seed Preferred Stock Purchase Agreement as of the date stated in the introductory clause.

Game of Silks, Inc. a Delaware corporation
By:	/s/ Daniel Nissanoff
	Daniel Nissanoff,
	President and Chief Executive Officer

Game of Silks, Inc.

Series Seed Preferred Stock Purchase Agreement

The parties are signing this Series Seed Preferred Stock Purchase Agreement as of the date stated in the introductory clause.

INVESTOR TROPICAL RACING, INC.
By:	/s/ Troy Levy
Name:	Troy Levy
Title:	Chief Executive Officer

Game of Silks, Inc.

Series Seed Preferred Stock Purchase Agreement

The parties are signing this Series Seed Preferred Stock Purchase Agreement as of the date stated in the introductory clause.

INVESTOR

(Print investor name)

(Signature)

(Print name of signatory, if signing for an entity)

(Print title of signatory, if signing for an entity)

Game of Silks, Inc.

Compliance Certificate

EX1A-11 CONSENT.1

EXHIBIT 11.1

Consent of Independent Registered Public Accounting Firm

We consent to the use of our report dated April 28, 2021, in the Regulation A Offering Statement (Form 1-A) of Tropical Racing Inc. and Subsidiaries.

Friedman CPA Group

Certified Public Accountants

Mach 11, 2022

Plantation, Florida

EX1A-12 OPN CNSL.1

EXHIBIT 12.1

March 11, 2022

Board of Directors

Tropical Racing Inc.

1740 Grassy Springs Road

Versailles, Kentucky 40383

Re:       Offering Circular on Form 1-A Post Qualification Amendment No. 1

Dear Board Members:

            You have requested our opinion with respect to certain matters in connection with the filing by Tropical Racing Inc. (the “Company”), of an Offering Circular on Form 1-A Post Qualification Amendment No. 1 (as amended or supplemented, the “Offering Circular”) with the Securities and Exchange Commission (the “Commission”).  The Offering Circular is filed pursuant to Regulation A under the Securities Act of 1933, as amended (the “Act”).

This opinion is submitted pursuant to the applicable rules of the Commission in connection with the qualification of the Offering Circular and the offering by the Company of up to 5,880,000 units (the “Units”) consisting of 5,880,000 shares of the Company’s Class A common stock, par value $.0001 per share (each share, a “Class A Share” and, together, the “Class A Shares”) and 5,880,000 Warrants (each whole warrant, a “Warrant” and collectively, the “Warrants”) exercisable for up to 5,880,000 Class A Shares underlying such Warrants (each, a “Warrant Share” and collectively, the “Warrant Shares”). Each Unit contains a Class A Share and a Warrant and is offered at a purchase price of $3.50 per Unit. One Warrant is required to purchase one additional Warrant Share at an exercise price of $5.00 per Warrant, subject to certain adjustments.

In connection with this opinion, we have examined and relied upon original, certified, conformed, photostat or other copies of (a) the Articles of Incorporation, as amended, and Bylaws of the Company; (b) resolutions of the Board of Directors of the Company authorizing the issuance of the Units, the Class A Shares, the Warrants and the Warrant Shares; (c) the Offering Circular and the exhibits thereto; (d) the agreements, instruments and documents pursuant to which the Units, the Class A Shares, the Warrants and the Warrant Shares were or are to be issued; (e) applicable provisions of the corporate laws of the State of Florida and published judicial and administrative interpretations thereof; and (f) such other matters of law as we have deemed necessary for the expression of the opinion herein contained.  In all such examinations, we have assumed the genuineness of all signatures on original documents, and the conformity to originals or certified documents of all copies submitted to us as conformed, photostat or other copies. In passing upon certain corporate records and documents of the Company, we have necessarily assumed the correctness and completeness of the statements made or included therein by the Company, and we express no opinion thereon.

Tropical Racing Inc.

March 11, 2022

Page 2

Based upon and subject to and limited by the foregoing, we are of the opinion that when the Offering Circular has been qualified by order of the Commission, the Class A Shares, the Warrants and the Warrant Shares, when issued and sold in accordance with the terms and conditions contemplated by and upon the terms and conditions set forth in the Offering Circular and that certain Subscription Agreement, a form which is attached to the Offering Circular as Exhibit 4.1, and upon receipt by the Company of the agreed upon consideration therefor, will be legally issued, fully paid and non-assessable. We are further of the opinion that the Units and the Warrants, when sold in accordance with the foregoing terms and conditions and the Subscription Agreement, will be binding obligations of the Company under the laws of the state of Florida.

The foregoing opinion is limited to the federal laws of the United States and the Florida Statutes, and we express no opinion as to the effect of the laws of any other jurisdiction. The foregoing reference to the Florida Statutes includes the statutory provisions and also all reported judicial decisions interpreting such laws.

This opinion has been prepared for use in connection with the Offering Circular, and this opinion may not be relied upon for any other purpose without our express written consent. Our opinion expressed herein is limited to the matters stated and no opinion is implied or may be inferred beyond the matters expressly stated herein.

We hereby consent to the filing of this opinion as an exhibit to the Offering Circular. In giving such permission, we do not admit hereby that we come within the category of persons whose consent is required under Section 7 of the Act, or the rules and regulations of the Commission thereunder. This opinion is expressed as of the date hereof, and we disclaim any undertaking to advise you of any subsequent changes in the facts stated or assumed herein or of any subsequent changes in applicable law.

Sincerely,

/s/ Greenberg Traurig, P.A.

GREENBERG TRAURIG, P.A.