Piermont Valley Acquisition Corp 8-K, filed Oct 2, 2026
Piermont Valley Acquisition Corp (CMCAF)
About this 8-K
Piermont Valley Acquisition Corp filed this 8-K on October 2, 2026, reporting on events of September 30, 2026.
Items reported
- Item 1.01: Entered into a material agreement
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
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Securities registered pursuant to section 12(b) of the Act:
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Item 1.01. Entry Into a Material Definitive Agreement.
On September 30, 2026, Piermont Valley Acquisition Corp., a Cayman Islands exempted company ("Piermont"), entered into a Securities Purchase Agreement (the "PIPE Securities Purchase Agreement") with Tigerless AI Holdings Inc., a Nevada corporation (“Pubco”), Tigerless Health, Inc., a New York corporation (“Tigerless”) and Capstan Point, LLC (the "PIPE Investor"). The PIPE Securities Purchase Agreement was entered into in connection with the previously announced business combination contemplated by the Agreement and Plan of Merger, dated as of April 17, 2026 (the "Business Combination Agreement"), by and among Piermont, Pubco, Tigerless, Tigerless Merger Sub 1 Corp. and Tigerless Merger Sub 2 Corp. The transactions contemplated by the Business Combination Agreement are referred to herein as the "Business Combination," and the closing of the Business Combination is referred to herein as the "Closing."
PIPE Securities Purchase Agreement
The PIPE Securities Purchase Agreement provides for Pubco to issue and sell to the PIPE Investor an aggregate of 5,000 shares of Pubco’s Series A Convertible Preferred Stock, par value $0.00001 per share (the "Series A Preferred Stock"), at a purchase price of $1,000 per share, equal to the stated value of such shares and without original issue discount, for aggregate gross proceeds of $5.0 million (the "PIPE Financing"). The offer and sale of the Series A Preferred Stock is being made without general solicitation or general advertising in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the "Securities Act"), and Rule 506(b) of Regulation D promulgated thereunder.
The purchase price will be funded in two tranches following the Closing. At the first closing, scheduled for the first business day following the Closing, Pubco will issue 3,500 shares of Series A Preferred Stock and receive $3.5 million. At the second closing, scheduled for the ninetieth business day following the Closing, Pubco will issue an additional 1,500 shares of Series A Preferred Stock and receive $1.5 million. The PIPE Investor’s second-tranche commitment is binding and is not subject to market-price, trading-volume, financing, due-diligence-out or discretionary conditions. However, it is subject to the continuing closing conditions in the PIPE Securities Purchase Agreement, including, among others, specified representations and covenants remaining true and correct and satisfied, no continuing Triggering Event or Pubco Default (each as defined in the PIPE Securities Purchase Agreement), continued listing of Pubco Class A Common Stock on The Nasdaq Stock Market LLC ("Nasdaq"), required registration-statement filings and any stockholder approval required under Nasdaq rules. If specified curable failures are continuing when the second PIPE closing would otherwise occur, the date of the second closing may be extended, but generally not more than 30 trading days.
As a condition to the first closing, Pubco must deliver evidence that the Business Combination Agreement has been amended, or that the applicable parties have granted a waiver, sufficient to permit the post-Closing funding schedule contemplated by the PIPE Securities Purchase Agreement. The PIPE Securities Purchase Agreement may be terminated in specified circumstances, including if the Closing has not occurred by the outside date set forth therein, subject to the terms of the PIPE Securities Purchase Agreement.
Series A Preferred Stock
The rights and preferences of the Series A Preferred Stock will be set forth in a Certificate of Designations to be filed with the Nevada Secretary of State before the first PIPE closing (the "Certificate of Designations"). Each share of Series A Preferred Stock will rank senior to Pubco’s Class A Common Stock and Class B Common Stock with respect to dividends, distributions and payments upon liquidation, dissolution or winding up. Dividends will not accrue unless declared by Pubco’s board of directors, except that default dividends will accrue following a Triggering Event as described below. The liquidation preference per share will be the greater of the applicable Conversion Amount (as defined below) and the amount the holder would receive on an as-converted basis.
Conversion
Each share of Series A Preferred Stock will be convertible at the holder’s option. The number of shares of Pubco Class A Common Stock issuable upon conversion will equal the applicable "Conversion Amount" divided by the applicable "Conversion Price." The Conversion Amount generally will equal 110% of stated value, plus declared and unpaid dividends and other amounts owed under the transaction documents. The Conversion Price will be the lower of (i) $10.00 and (ii) 93% of the lowest daily volume-weighted average price of Pubco Class A Common Stock during the five trading days immediately preceding conversion, subject to a floor price.
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The initial floor price will be $2.00. On the date all shares issuable upon conversion are freely tradable pursuant to an effective resale registration statement or Rule 144 under the Securities Act without volume or manner-of-sale limitations, and every six months thereafter, the floor price will automatically reset lower, and only lower, to 20% of the lower of (x) the closing price on the immediately preceding trading day and (y) the average closing price during the five trading days ending on the immediately preceding trading day, in each case subject to applicable Nasdaq rules. At a $10.00 Conversion Price, the 5,000 shares of Series A Preferred Stock would initially be convertible into at least 550,000 shares of Pubco Class A Common Stock; at the initial $2.00 floor price, they would initially be convertible into approximately 2,750,000 shares, in each case before declared dividends, Triggering Event adjustments or other amounts. If the floor price resets below $2.00, a larger number of shares could become issuable.
Conversions will initially be subject to a 4.99% beneficial-ownership limitation. A holder may decrease that percentage or increase it to a percentage not exceeding 9.99%, provided that any increase will become effective only on the sixty-first day after notice. Pubco also will be required to reserve at least 200% of the number of shares then necessary to convert all outstanding shares of Series A Preferred Stock at the applicable floor price, without giving effect to conversion limitations.
Triggering Events and Redemption Rights
The Certificate of Designations will contain customary and negotiated Triggering Events relating to, among other matters, failures to maintain required resale registration, trading or Nasdaq listing failures, failures to timely deliver conversion shares or remove legends, certain payment failures, specified defaults on indebtedness, bankruptcy and insolvency events, judgments, material breaches of the transaction documents, delinquent Exchange Act reporting, a material adverse effect and certain restrictions imposed by The Depository Trust Company. Upon a Triggering Event, the stated value of each outstanding share of Series A Preferred Stock will increase by 15% on a one-time basis and a 5% annual default dividend will begin to accrue while the Triggering Event continues. If a Triggering Event remains uncured, a holder also may require Pubco to apply up to 25% of the gross cash proceeds of each subsequent debt or equity financing to redeem shares of Series A Preferred Stock. During specified Triggering Events, a holder may use an alternate conversion price that may be lower than the otherwise applicable Conversion Price, subject to the applicable floor-price provisions.
Pubco may redeem all or a portion of the outstanding shares of Series A Preferred Stock for cash at 110% of the stated value being redeemed plus declared and unpaid dividends and other amounts then owed, on at least 15 business days’ notice, subject to the holder’s continuing right to convert before payment and provided no Triggering Event is continuing. In specified fundamental transactions, the successor entity generally must assume the Series A Preferred Stock or Pubco must redeem it at the applicable optional-redemption price; if the transaction results in Pubco no longer being publicly traded on a national securities exchange, each holder may elect cash redemption.
Closing Fee Shares
As a one-time closing fee, one or more existing stockholders of Tigerless and/or Piermont are obligated to transfer an aggregate of 2,000,000 shares of Pubco Class A Common Stock to the PIPE Investor (the "Closing Fee Shares"). Immediately prior to the Closing, the transferring holders will deliver only the maximum number of Closing Fee Shares that can be delivered without causing the PIPE Investor and its attribution parties to exceed 4.99% beneficial ownership. Thereafter, within one trading day after each written notice from the PIPE Investor certifying its then-current beneficial ownership, the transferring holders must deliver the maximum additional number of remaining Closing Fee Shares that can be received without exceeding the 4.99% cap, until all 2,000,000 Closing Fee Shares have been delivered. Because the Closing Fee Shares will be transferred by existing holders, their transfer will not itself increase the number of Pubco shares outstanding.
Registration Rights and Leak-Out Restrictions
Pubco has agreed to reimburse up to $25,000 of the PIPE Investor’s reasonable documented legal and diligence expenses at the first PIPE closing. Pubco also must file, within 30 calendar days after the first PIPE closing, a resale registration statement covering 200% of the maximum number of shares issuable upon conversion at the initial floor price, together with the Closing Fee Shares to the extent they are not then freely tradable. Pubco must use its best efforts to cause that registration statement to become effective no later than 30 days after the filing deadline if the Securities and Exchange Commission (the "SEC") does not review it and no later than 60 days after the filing deadline if the SEC reviews it, subject to specified exceptions. Additional registration statements will be required if the shares covered by effective registration statements later become insufficient because of, among other things, a reset of the floor price.
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If specified registration deadlines are missed or the PIPE Investor is unable to use an effective prospectus, subject to stated exceptions, Pubco must pay cash liquidated damages equal to 5% of the purchase price paid for the then-outstanding shares of Series A Preferred Stock when the registration event occurs and an additional 5% for each 30-day period that the event continues, prorated for partial periods. Unpaid liquidated damages will bear interest at 18% per year, subject to the maximum lawful rate. Pubco may suspend use of a resale prospectus for specified material nonpublic-information periods of up to 10 consecutive days and 20 aggregate days in any 365-day period. The PIPE Investor also will have specified demand and piggyback registration rights.
Until the earlier of termination of the PIPE Securities Purchase Agreement and completion of the second PIPE closing, the PIPE Investor will be subject to daily leak-out restrictions on open-market sales of Closing Fee Shares and shares received upon conversion. The PIPE Investor nevertheless may sell on any trading day a number of shares not exceeding the greater of (i) $75,000 divided by the prior trading day’s closing price and (ii) 8% of the trading volume on the day of sale. After that period, the contractual leak-out restriction will terminate, subject to applicable securities laws.
Other Covenants
For so long as any shares of Series A Preferred Stock remain outstanding, the Certificate of Designations will restrict, among other things, cash dividends and repurchases of junior or parity securities and the issuance of senior or parity preferred securities without the required holders’ consent. The Series A Preferred Stock generally will have no voting rights except for protective votes specified in the Certificate of Designations and voting rights required under Nevada law. Pubco must use the proceeds from the PIPE Financing for working capital, growth initiatives, transaction expenses and general corporate purposes.
The foregoing descriptions of the PIPE Securities Purchase Agreement and the Certificate of Designations do not purport to be complete and are qualified in their entirety by reference to the PIPE Securities Purchase Agreement and the form of Certificate of Designations included therein, which are filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
Cautionary Note Regarding Forward-Looking Statements
This Current Report on Form 8-K and the exhibits filed herewith contain "forward-looking statements" within the meaning of the federal securities laws with respect to the Business Combination and the PIPE Financing, including statements regarding the anticipated timing of the Closing and the PIPE closings, the expected proceeds of the PIPE Financing, the listing of Pubco Class A Common Stock on Nasdaq, the filing and effectiveness of resale registration statements, the issuance or transfer of securities and the expected use of proceeds. These forward-looking statements generally are identified by words such as "expect," "estimate," "project," "anticipate," "intend," "plan," "may," "will," "could," "should," "believe," "potential," "future" and similar expressions.
These forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from expected results. These risks and uncertainties include, among others: the failure to satisfy the conditions to the consummation of the Business Combination or the PIPE Financing; the inability to obtain required stockholder or regulatory approvals; the failure of Pubco Class A Common Stock to be listed or remain listed on Nasdaq; the inability to timely file or cause to become effective required resale registration statements; the occurrence of a Triggering Event or Pubco Default; fluctuations in the market price and trading volume of Pubco Class A Common Stock; dilution resulting from conversions of the Series A Preferred Stock, including following a decrease in the floor price; the occurrence of events that may permit termination of the Business Combination Agreement or the PIPE Securities Purchase Agreement; costs related to the Business Combination and the PIPE Financing; changes in applicable laws or regulations; and other risks and uncertainties described in Piermont’s filings with the SEC and in the proxy statement/prospectus relating to the Business Combination when available.
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Piermont, Pubco and Tigerless caution readers not to place undue reliance upon any forward-looking statements, which speak only as of the date made. None of Piermont, Pubco or Tigerless undertakes or accepts any obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Additional Information and Where to Find It
This Current Report on Form 8-K is not a proxy statement or solicitation of a proxy, consent or authorization with respect to any securities or in respect of the Business Combination and does not constitute an offer to sell, buy or exchange, or the solicitation of an offer to sell, buy or exchange, any securities or the solicitation of any vote or approval in any jurisdiction, nor shall there be any sale, purchase or exchange of securities or solicitation of any vote or approval in any jurisdiction in contravention of applicable law.
In connection with the Business Combination, Pubco intends to file with the SEC a registration statement on Form S-4, which will include a prospectus of Pubco and a proxy statement of Piermont (the "Proxy Statement/Prospectus"). Piermont intends to mail the definitive Proxy Statement/Prospectus to its shareholders in connection with the Business Combination. INVESTORS AND SECURITYHOLDERS OF PIERMONT ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS AND OTHER RELEVANT DOCUMENTS FILED OR TO BE FILED WITH THE SEC CAREFULLY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT PUBCO, PIERMONT, TIGERLESS, THE BUSINESS COMBINATION, THE PIPE FINANCING AND RELATED MATTERS. Investors and securityholders will be able to obtain free copies of the Proxy Statement/Prospectus, when available, and other documents filed with the SEC by Pubco and Piermont through the website maintained by the SEC at www.sec.gov.
Participants in the Solicitation
Pubco, Piermont, Tigerless and certain of their respective directors, executive officers and employees may be considered participants in the solicitation of proxies in connection with the Business Combination. Information regarding the persons who may, under the rules of the SEC, be deemed participants in the solicitation of Piermont’s shareholders in connection with the Business Combination, including a description of their respective direct and indirect interests, by security holdings or otherwise, will be included in the Proxy Statement/Prospectus described above when it is filed with the SEC. Additional information regarding Piermont’s directors and executive officers can be found in Piermont’s filings with the SEC. These documents are available free of charge as described above.
No Offer or Solicitation
This Current Report on Form 8-K does not constitute (i) a solicitation of a proxy, consent or authorization with respect to any securities or in respect of the Business Combination, (ii) an offer to sell or the solicitation of an offer to buy any securities or (iii) a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of the Securities Act or an applicable exemption from registration.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. |
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| Form of Certificate of Designations of Series A Convertible Preferred Stock. | |
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104 |
| Cover Page Interactive Data File (embedded within the Inline XBRL document). |
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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| PIERMONT VALLEY ACQUISITION CORP |
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Dated: October 2, 2026 | By: | /s/ Wei Qian |
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| Wei Qian |
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| Chairman and Chief Executive Officer |
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EXHIBIT 4.1
CERTIFICATE OF DESIGNATIONS OF
SERIES A CONVERTIBLE PREFERRED STOCK OF
TIGERLESS AI HOLDINGS INC.
I, Zikang Wu, hereby certify that I am the Chief Executive Officer of Tigerless AI Holdings Inc. (the “Company”), a corporation organized and existing under the Nevada Revised Statutes (the “NRS”), and further do hereby certify:
That pursuant to the authority expressly conferred upon the Board of Directors of the Company (the “Board”) by the Company’s Articles of Incorporation, as amended (the “Articles of Incorporation”), and Section 78.1955 of the NRS, the Board on September 28, 2026 adopted the following resolution determining it desirable and in the best interests of the Company and its stockholders for the Company to create a series of one hundred thousand (100,000) shares of preferred stock designated as “Series A Convertible Preferred Stock”, none of which shares have been issued:
RESOLVED, that pursuant to the authority vested in the Board of this Company, in accordance with the provisions of the Articles of Incorporation, a series of preferred stock, par value $0.00001 per share, of the Company be and hereby is created, and that the designation and number of shares thereof and the voting and other powers, preferences and relative, participating, optional or other rights of the shares of such series and the qualifications, limitations and restrictions thereof are as follows:
TERMS OF SERIES A CONVERTIBLE PREFERRED STOCK
1. Designation and Number of Shares. There shall hereby be created and established a series of preferred stock of the Company designated as “Series A Convertible Preferred Stock” (the “Series A Convertible Preferred Stock”). The authorized number of shares of Series A Convertible Preferred Stock (the “Preferred Shares”) shall be one hundred thousand (100,000) shares. Each Preferred Share shall have a par value of $0.00001 per share. Capitalized terms not defined herein shall have the meaning as set forth in Section 31 below.
2. Ranking. Except to the extent that the holders of at least a majority of the outstanding Preferred Shares (the “Required Holders”) expressly consent to the creation or issuance of Parity Stock (as defined below) or Senior Preferred Stock (as defined below) in accordance with Section 16, all shares of capital stock of the Company shall be junior in rank to all Preferred Shares with respect to the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company (such junior stock is referred to herein collectively as “Junior Stock”). For the avoidance of doubt, the Preferred Shares will, with respect to dividend rights and rights on liquidation, winding-up and dissolution, rank (A) junior to any Senior Preferred Stock approved in accordance herewith, (B) on parity with any Parity Stock approved in accordance herewith and (C) senior to the Junior Stock, including the Common Stock. The rights of all such shares of Junior Stock shall be subject to the rights, powers, preferences and privileges of the Preferred Shares. Without limiting any other provision of this Certificate of Designations, without the prior express consent of the Required Holders, voting separately as a single class, the Company shall not hereafter authorize or issue any additional or other shares of capital stock (other than Preferred Shares in accordance with the Securities Purchase Agreement) that are (i) of senior rank to the Preferred Shares in respect of the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company (collectively, the “Senior Preferred Stock”) or (ii) of pari passu rank to the Preferred Shares in respect of the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company (collectively, the “Parity Stock”). Except as otherwise provided in Section 6, in the event of the merger or consolidation of the Company with or into another corporation, the Preferred Shares shall maintain their relative rights, powers, designations, privileges and preferences provided for herein and no such merger or consolidation shall result inconsistent therewith.
3. Dividends. From and after the first date of issuance of any Preferred Shares (the “Initial Issuance Date”), each holder of a Preferred Share (each, a “Holder” and collectively, the “Holders”) shall be entitled to receive dividends only when, as and if declared by the Board out of funds legally available therefor. No dividends shall accrue on the Preferred Shares unless and until declared by the Board. Any declared and unpaid dividends shall be included in the Conversion Amount and in any redemption or liquidation amount payable in respect of the Preferred Shares as provided herein.
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4. Conversion. At any time after the Initial Issuance Date, each Preferred Share shall be convertible into validly issued, fully paid and non-assessable shares of Common Stock (the “Conversion Shares”), on the terms and conditions set forth in this Section 4.
(a) Holder’s Conversion Right. Subject to the provisions of Section 4(d), at any time or times on or after the Initial Issuance Date, each Holder shall be entitled to convert any portion of the outstanding Preferred Shares held by such Holder into validly issued, fully paid and non-assessable Conversion Shares in accordance with Section 4(c) at the Conversion Rate (as defined below). The Company shall not issue any fraction of a share of Common Stock upon any conversion. If the issuance would result in the issuance of a fraction of a share of Common Stock, the Company shall round such fraction of a share of Common Stock up to the nearest whole share. The Company shall pay any and all transfer, stamp, issuance and similar taxes, costs and expenses (including, without limitation, fees and expenses of the Transfer Agent) that may be payable with respect to the issuance and delivery of Common Stock upon conversion of any Preferred Shares.
(b) Conversion Rate. Except as otherwise provided herein, the number of Conversion Shares issuable upon conversion of any Preferred Share pursuant to this Section 4 shall be determined by dividing (x) the Conversion Amount of such Preferred Share by (y) the Conversion Price (the “Conversion Rate”).
(i) For purposes of this Certificate of Designations, the term “Conversion Amount” means, with respect to each Preferred Share, as of the applicable date of determination, the sum of (1) 110% of the Stated Value thereof, plus (2) any Additional Amount thereon as of such date of determination, plus (3) any other amounts thereon owed to such Holder pursuant to this Certificate of Designations or any other Transaction Document.
(ii) For purposes of this Certificate of Designations, the term “Conversion Price” means, with respect to each Preferred Share, as of any Conversion Date or other date of determination, the lower of (x) $10.00 and (y) the Market Price as of such date, subject to the Floor Price and adjustment as provided herein.
(c) Mechanics of Conversion. The conversion of each Preferred Share shall be conducted in the following manner:
(i) Optional Conversion. To convert one or more Preferred Shares into Conversion Shares on any date (a “Conversion Date”), a Holder shall deliver (whether via electronic mail or otherwise), for receipt on or prior to 11:59 p.m., New York time, on such date, a copy of an executed notice of conversion of the Preferred Share(s) subject to such conversion in the form attached hereto as Exhibit I (the “Conversion Notice”) to the Company. If required by Section 4(c)(iii), within three (3) Trading Days following a conversion of any such Preferred Shares as aforesaid, such Holder shall surrender to a nationally recognized overnight delivery service for delivery to the Company the original certificates, if any, representing the Preferred Shares (the “Preferred Share Certificates”) so converted as aforesaid (or an indemnification undertaking with respect to the Preferred Shares in the case of its loss, theft or destruction as contemplated by Section 18). On the date of receipt of a Conversion Notice, the Company shall transmit to such Holder and the Transfer Agent by electronic mail a confirmation of receipt of such Conversion Notice and representation as to whether such shares of Common Stock may then be resold pursuant to Rule 144 under the 1933 Act (or a successor rule thereto) (collectively, “Rule 144”), in the form attached hereto as Exhibit II, which confirmation shall constitute an instruction to the Transfer Agent to process such Conversion Notice in accordance with the terms set forth herein. On or before the first (1st) Trading Day following each date on which the Company has received a Conversion Notice (or such earlier date as required pursuant to the 1934 Act or other applicable law, rule or regulation for the settlement of a trade initiated on the applicable Conversion Date of such shares of Common Stock issuable pursuant to such Conversion Notice) (the “Share Delivery Deadline”), the Company shall (1) provided that the Transfer Agent is participating in the Fast Automated Securities Transfer Program (“FAST”) and such shares of Common Stock may be sold by such Holder pursuant to Rule 144 or an effective registration statement (the “Resale Eligibility Conditions”), cause the Transfer Agent to credit such aggregate number of shares of Common Stock to which such Holder shall be entitled to such Holder’s or its designee’s balance account with DTC through its Deposit/Withdrawal at Custodian system, or (2) if the Transfer Agent is not participating in FAST or the Resale Eligibility Conditions are not satisfied, issue and deliver (via reputable overnight courier) to the address as specified in the Conversion Notice, a certificate, registered in the name of such Holder or its designee, for the number of shares of Common Stock to which such Holder shall be entitled, which certificate shall bear any restrictive legend required by applicable securities laws. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender any Preferred Share Certificate to the Company until such Holder has converted all of the Preferred Shares represented by such Preferred Share Certificate. All conversions of Preferred Shares shall be effected in accordance with this Certificate of Designations and the Irrevocable Transfer Agent Instructions (as defined in the Securities Purchase Agreement), including the applicable FAST/DWAC delivery mechanics and any legal opinion reasonably required by the Transfer Agent in connection therewith.
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(ii) Company’s Failure to Timely Convert. If the Company shall fail, for any reason or for no reason, on or prior to the applicable Share Delivery Deadline, if the Transfer Agent is not participating in FAST or the Resale Eligibility Conditions are not satisfied, to issue and deliver to such Holder (or its designee) a certificate for the number of Conversion Shares to which such Holder is entitled and register such Conversion Shares on the Company’s share register or, if the Transfer Agent is participating in FAST and the Resale Eligibility Conditions are satisfied, to credit such Holder’s or its designee’s balance account with DTC for such number of Conversion Shares to which such Holder is entitled upon such Holder’s conversion of any Conversion Amount (as the case may be) (each, a “Conversion Failure”), then, in addition to all other remedies available to such Holder, the Company shall pay to such Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Conversion Shares (based on the applicable Conversion Price) subject to such Conversion Failure, the sum of (1) $10 per Trading Day (increasing to $25 per Trading Day on the second (2nd) Trading Day after such Delivery Failure and on each Trading Day thereafter) until such Conversion Shares are delivered or such Holder rescinds the applicable Conversion Notice, and if on or after such Share Delivery Deadline such Holder acquires (in an open market transaction or otherwise) shares of Common Stock corresponding to all or any portion of the number of Conversion Shares issuable upon such conversion that such Holder is entitled to receive from the Company and has not received from the Company in connection with such Conversion Failure (a “Buy-In”), then, in addition to all other remedies available to such Holder, the Company shall, within one (1) Business Day after receipt of such Holder’s request and in such Holder’s discretion, either: (I) pay cash to such Holder in an amount equal to such Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so acquired (including, without limitation, by any other Person in respect, or on behalf, of such Holder) (the “Buy-In Price”), at which point the Company’s obligation to so issue and deliver such certificate (and to issue such Conversion Shares) or credit to the balance account of such Holder or such Holder’s designee, as applicable, with DTC for the number of Conversion Shares to which such Holder is entitled upon such Holder’s conversion hereunder (as the case may be) (and to issue such Conversion Shares) shall terminate and the conversion shall be deemed to have been completed, or (II) promptly honor its obligation to so issue and deliver to such Holder a certificate or certificates representing such Conversion Shares or credit the balance account of such Holder or such Holder’s designee, as applicable, with DTC for the number of Conversion Shares to which such Holder is entitled upon such Holder’s conversion hereunder (as the case may be) and pay cash to such Holder in an amount equal to the excess (if any) of the Buy-In Price over the product of (x) such number of shares of Common Stock multiplied by (y) the lowest Closing Sale Price of the Common Stock on any Trading Day during the period commencing on the date of the applicable Conversion Notice and ending on the date of such issuance and payment under this clause (II) (each, a “Buy-In Payment Amount”). Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity, including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver certificates representing Conversion Shares (or to electronically deliver such Conversion Shares) upon the conversion of the Preferred Shares as required pursuant to the terms hereof.
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(iii) Registration; Book-Entry. At the time of issuance of any Preferred Shares hereunder, the applicable Holder may, by written request (including by electronic-mail) to the Company, elect to receive such Preferred Shares in the form of one or more Preferred Share Certificates or in Book-Entry form. The Company (or the Transfer Agent, as custodian for the Preferred Shares) shall maintain a register (the “Register”) for the recordation of the names and addresses of the Holders of each Preferred Share and the Stated Value of the Preferred Shares and whether the Preferred Shares are held by such Holder in Preferred Share Certificates or in Book-Entry form (the “Registered Preferred Shares”). The entries in the Register shall be conclusive and binding for all purposes absent manifest error. The Company and each Holder of the Preferred Shares shall treat each Person whose name is recorded in the Register as the owner of a Preferred Share for all purposes (including, without limitation, the right to receive payments and dividends hereunder) notwithstanding notice to the contrary. A Registered Preferred Share may be assigned, transferred or sold only by registration of such assignment or sale on the Register. Upon its receipt of a written request to assign, transfer or sell one or more Registered Preferred Shares by such Holder thereof, the Company shall record the information contained therein in the Register and issue one or more new Registered Preferred Shares in the same aggregate Stated Value as the Stated Value of the surrendered Registered Preferred Shares to the designated assignee or transferee pursuant to Section 18, provided that if the Company does not so record an assignment, transfer or sale (as the case may be) of such Registered Preferred Shares within one (1) Business Day of such a request, then the Register shall be automatically deemed updated to reflect such assignment, transfer or sale (as the case may be). Notwithstanding anything to the contrary set forth in this Section 4, following conversion of any Preferred Shares in accordance with the terms hereof, the applicable Holder shall not be required to physically surrender such Preferred Shares held in the form of a Preferred Share Certificate to the Company unless (A) the full or remaining number of Preferred Shares represented by the applicable Preferred Share Certificate are being converted (in which event such certificate(s) shall be delivered to the Company as contemplated by this Section 4(c)(iii)) or (B) such Holder has provided the Company with prior written notice (which notice may be included in a Conversion Notice) requesting reissuance of Preferred Shares upon physical surrender of the applicable Preferred Share Certificate. Each Holder and the Company shall maintain records showing the Stated Value and Dividends converted and/or paid (as the case may be) and the dates of such conversions and/or payments (as the case may be) or shall use such other method, reasonably satisfactory to such Holder and the Company, so as not to require physical surrender of a Preferred Share Certificate upon conversion. If the Company does not update the Register to record such Stated Value and Dividends converted and/or paid (as the case may be) and the dates of such conversions and/or payments (as the case may be) within one (1) Business Day of such occurrence, then the Register shall be automatically deemed updated to reflect such occurrence. In the event of any dispute or discrepancy, the records of the Holder establishing the number of Preferred Shares to which the record holder is entitled shall be controlling and determinative in the absence of manifest error. A Holder and any transferee or assignee, by acceptance of a certificate, acknowledge and agree that, by reason of the provisions of this paragraph, following conversion of any Preferred Shares, the number of Preferred Shares represented by such certificate may be less than the number of Preferred Shares stated on the face thereof. Each Preferred Share Certificate shall bear the following legend:
ANY TRANSFEREE OR ASSIGNEE OF THIS CERTIFICATE SHOULD CAREFULLY REVIEW THE TERMS OF THE CORPORATION’S CERTIFICATE OF DESIGNATIONS RELATING TO THE SHARES OF SERIES A CONVERTIBLE PREFERRED STOCK REPRESENTED BY THIS CERTIFICATE, INCLUDING SECTION 4(c)(iii) THEREOF. THE NUMBER OF SHARES OF SERIES A CONVERTIBLE PREFERRED STOCK REPRESENTED BY THIS CERTIFICATE MAY BE LESS THAN THE NUMBER OF SHARES OF SERIES A CONVERTIBLE PREFERRED STOCK STATED ON THE FACE HEREOF PURSUANT TO SECTION 4(c)(iii) OF THE CERTIFICATE OF DESIGNATIONS RELATING TO THE SHARES OF SERIES A CONVERTIBLE PREFERRED STOCK REPRESENTED BY THIS CERTIFICATE.
(iv) Pro Rata Conversion; Disputes. In the event that the Company receives a Conversion Notice from more than one Holder for the same Conversion Date and the Company can convert some, but not all, of such Preferred Shares submitted for conversion, the Company shall convert from each Holder electing to have Preferred Shares converted on such date a pro rata amount of such Holder’s Preferred Shares submitted for conversion on such date based on the number of Preferred Shares submitted for conversion on such date by such Holder relative to the aggregate number of Preferred Shares submitted for conversion on such date. In the event of a dispute as to the number of Conversion Shares issuable to a Holder in connection with a conversion of Preferred Shares, the Company shall issue to such Holder the number of Conversion Shares not in dispute and resolve such dispute in accordance with Section 23. If a Conversion Notice delivered to the Company would result in a breach of Section 4(d) below, and the applicable Holder does not elect in writing to withdraw, in whole, such Conversion Notice, the Company shall hold such Conversion Notice in abeyance until such time as such Conversion Notice may be satisfied without violating Section 4(d) below (with such calculations thereunder made as of the date such Conversion Notice was initially delivered to the Company).
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(d) Limitations on Conversion. The Company shall not effect the conversion of any of the Preferred Shares held by a Holder, and such Holder shall not have the right to convert any of the Preferred Shares held by such Holder pursuant to the terms and conditions of this Certificate of Designations and any such conversion shall be null and void and treated as if never made, to the extent that after giving effect to such conversion, such Holder together with the other Attribution Parties collectively would beneficially own in excess of 4.99% (the “Maximum Percentage”) of the shares of Common Stock outstanding immediately after giving effect to such conversion. For purposes of the foregoing sentence, the aggregate number of shares of Common Stock beneficially owned by such Holder and the other Attribution Parties shall include the number of shares of Common Stock held by such Holder and all other Attribution Parties plus the number of shares of Common Stock issuable upon conversion of the Preferred Shares with respect to which the determination of such sentence is being made, but shall exclude shares of Common Stock which would be issuable upon (A) conversion of the remaining, nonconverted Preferred Shares beneficially owned by such Holder or any of the other Attribution Parties and (B) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation, any convertible notes, convertible preferred stock or warrants, including the Preferred Shares) beneficially owned by such Holder or any other Attribution Party subject to a limitation on conversion or exercise analogous to the limitation contained in this Section 4(d). For purposes of this Section 4(d), beneficial ownership shall be calculated in accordance with Section 13(d) of the 1934 Act. For the avoidance of doubt, the calculation of the Maximum Percentage shall take into account the concurrent exercise and/or conversion, as applicable, of the unexercised or unconverted portion of any other securities of the Company beneficially owned by such Holder and/or any other Attribution Party, as applicable. For purposes of determining the number of outstanding shares of Common Stock a Holder may acquire upon the conversion of such Preferred Shares without exceeding the Maximum Percentage, such Holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the Company’s most recent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form 8-K or other public filing with the SEC, as the case may be, (y) a more recent public announcement by the Company or (z) any other written notice by the Company or the Transfer Agent, if any, setting forth the number of shares of Common Stock outstanding (the “Reported Outstanding Share Number”). If the Company receives a Conversion Notice from a Holder at a time when the actual number of outstanding shares of Common Stock is less than the Reported Outstanding Share Number, the Company shall notify such Holder in writing of the number of shares of Common Stock then outstanding and, to the extent that such Conversion Notice would otherwise cause such Holder’s beneficial ownership, as determined pursuant to this Section 4(d), to exceed the Maximum Percentage, such Holder must notify the Company of a reduced number of shares of Common Stock to be purchased pursuant to such Conversion Notice. For any reason at any time, upon the written or oral request of any Holder, the Company shall within one (1) Business Day confirm orally and in writing or by electronic mail to such Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including such Preferred Shares, by such Holder and any other Attribution Party since the date as of which the Reported Outstanding Share Number was reported. In the event that the issuance of shares of Common Stock to a Holder upon conversion of such Preferred Shares results in such Holder and the other Attribution Parties being deemed to beneficially own, in the aggregate, more than the Maximum Percentage of the number of outstanding shares of Common Stock (as determined under Section 13(d) of the 1934 Act), the number of shares so issued by which such Holder’s and the other Attribution Parties’ aggregate beneficial ownership exceeds the Maximum Percentage (the “Excess Shares”) shall be deemed null and void and shall be cancelled ab initio, and such Holder shall not have the power to vote or to transfer the Excess Shares. Upon delivery of a written notice to the Company, any Holder may from time to time increase (with such increase not effective until the sixty-first (61st) day after delivery of such notice) or decrease the Maximum Percentage of such Holder to any other percentage not in excess of 9.99% as specified in such notice; provided, that (i) any such increase in the Maximum Percentage will not be effective until the sixty-first (61st) day after such notice is delivered to the Company and (ii) any such increase or decrease will apply only to such Holder and the other Attribution Parties and not to any other Holder that is not an Attribution Party of such Holder. For purposes of clarity, the shares of Common Stock issuable to a Holder pursuant to the terms of this Certificate of Designations in excess of the Maximum Percentage shall not be deemed to be beneficially owned by such Holder for any purpose including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the 1934 Act. No prior inability to convert such Preferred Shares pursuant to this paragraph shall have any effect on the applicability of the provisions of this paragraph with respect to any subsequent determination of convertibility. The provisions of this paragraph shall not be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 4(d) to the extent necessary to correct this paragraph (or any portion of this paragraph) which may be defective or inconsistent with the intended beneficial ownership limitation contained in this Section 4(d) or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitation contained in this paragraph may not be amended, modified or waived and shall apply to a successor holder of such Preferred Shares.
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(e) Right of Alternate Conversion.
(i) Alternate Conversion Upon a Triggering Event. Subject to Section 4(d), at any time after the earlier of a Holder’s receipt of a Triggering Event Notice (as defined below) and such Holder becoming aware of a Triggering Event (such earlier date, the “Alternate Conversion Right Commencement Date”) and ending (such ending date, the “Alternate Conversion Right Expiration Date”, and each such period, an “Alternate Conversion Right Period”) on the date such Triggering Event is cured, such Holder may, at such Holder’s option, by delivery of a Conversion Notice to the Company (the date of any such Conversion Notice, each an “Alternate Conversion Date”), convert all, or any number of Preferred Shares (such Conversion Amount of the Preferred Shares to be converted pursuant to this Section 4(e)(i), the “Triggering Event Conversion Amount” and together with each Alternate Optional Conversion Amount, each, an “Alternate Conversion Amount”) into shares of Common Stock at the Alternate Conversion Price (each, a “Triggering Event Conversion”, and together with each Alternate Optional Conversion, each an “Alternate Conversion”).
(ii) Mechanics of Alternate Conversion. On any Alternate Conversion Date, a Holder may voluntarily convert any number of Preferred Shares held by such Holder pursuant to Section 4(c) (with “Alternate Conversion Price” replacing “Conversion Price” for all purposes hereunder with respect to such Alternate Conversion and, solely with respect to the calculation of the number of shares of Common Stock issuable upon conversion of any Conversion Amount of Preferred Shares in a Triggering Event Conversion, with no change to clause (1) of the definition of “Conversion Amount” above with respect to such Triggering Event Conversion) by designating in the Conversion Notice delivered pursuant to this Section 4(e) of this Certificate of Designations that such Holder is electing to use the Alternate Conversion Price for such conversion; provided, that in the event of the Conversion Floor Price Condition, on the applicable Alternate Conversion Date, the Stated Value of the remaining Preferred Shares of such Holder shall automatically increase, pro rata, by the applicable Alternate Conversion Floor Amount or, at the Company’s option, the Company shall deliver the applicable Alternate Conversion Floor Amount in cash to such applicable Holder on the applicable Alternate Conversion Date. Notwithstanding anything to the contrary in this Section 4(e)(ii), but subject to Section 4(d), until the Company delivers to such Holder the shares of Common Stock to which such Holder is entitled pursuant to the applicable Alternate Conversion of such Holder’s Preferred Shares, such Preferred Shares may be converted by such Holder into shares of Common Stock pursuant to Section 4(c) without regard to this Section 4(e)(ii). In the event of an Alternate Conversion pursuant to this Section 4(e)(ii) of all, or any portion, of any Preferred Shares of a Holder, such Holder’s damages would be uncertain and difficult to estimate because of the parties’ inability to predict future interest rates and the uncertainty of the availability of a suitable substitute investment opportunity for such Holder. Accordingly, any redemption premium due under this Section 4(e)(ii), together the Alternate Conversion Price used in such Alternate Conversion, as applicable, is intended by the parties to be, and shall be deemed, a reasonable estimate of, such Holder’s actual loss of its investment opportunity and not as a penalty.
5. Triggering Events.
(a) General. Unless waived by a Holder, each of the following events shall constitute a “Triggering Event”:
(i) while the Company is required to maintain a Registration Statement effective pursuant to Section 5.4 of the Securities Purchase Agreement, the effectiveness of that Registration Statement lapses for any reason (including the issuance of a stop order) or the Registration Statement or the prospectus contained therein is unavailable to any Holder for the resale of all Registrable Securities in accordance with Section 5.4 of the Securities Purchase Agreement, and such lapse or unavailability continues for ten (10) consecutive days or for more than twenty (20) days in the aggregate during any 365-day period, provided, that no Triggering Event shall occur under this clause (i) if, and for so long as, all Registrable Securities may be sold by the Holders without volume or manner-of-sale limitations pursuant to Rule 144;
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(ii) the suspension from trading or the failure of the Common Stock to be trading or listed (as applicable) on an Eligible Market for a period of two (2) consecutive Trading Days (other than any suspension or limitation of trading applicable generally to securities listed or quoted on the applicable Eligible Market);
(iii) the Company’s (A) failure to cure a Conversion Failure by delivery of the required number of shares of Common Stock within three (3) Trading Days after the applicable Conversion Date or exercise date (as the case may be) or (B) intention not to comply, as required, with a request for conversion of any Preferred Shares into shares of Common Stock that is requested in accordance with the provisions of this Certificate of Designations, other than pursuant to Section 4(d) hereof;
(iv) if a Holder’s Authorized Share Allocation (as defined in Section 11(a) below) is less than the number of shares of Common Stock that such Holder would be entitled to receive upon a conversion, in full, of all of the Preferred Shares then held by such Holder (without regard to any limitations on the conversion of the Preferred Shares set forth herein) and the Company fails to comply with its obligations under Section 11(b) with respect thereto; provided, that no Triggering Event shall occur under this clause (iv) for so long as the Company is taking the actions required by, and is otherwise in compliance with, Section 11(b);
(v) the Company at any time terminates, replaces, or removes its transfer agent, or appoints, engages, or otherwise uses any successor or replacement transfer agent, unless, as a condition to and prior to the effectiveness of any such change, such successor or replacement transfer agent (i) delivers to the Holder duly executed Irrevocable Transfer Agent Instructions substantially similar in form and substance to those in Exhibit B of the Securities Purchase Agreement; and (ii) is a participant in good standing in the DTC Fast Automated Securities Transfer program, provided, that the Company shall provide written notice to the Holders of any replacement of its transfer agent; provided further, that no Triggering Event shall occur solely as a result of a failure to satisfy clause (ii) if the Company engages a transfer agent that is a participant in good standing in the DTC Fast Automated Securities Transfer program within two (2) Business Days;
(vi) the Company’s failure to pay to any Holder any amount when and as due under this Certificate of Designations, the Securities Purchase Agreement or any other Transaction Document, except only if such failure remains uncured for a period of at least five (5) Trading Days;
(vii) the Company fails to remove any restrictive legend on any certificate or any shares of Common Stock issued to the applicable Holder upon conversion or exercise (as the case may be) of any Securities acquired by such Holder under the Transaction Documents as and when required by such Securities or the Securities Purchase Agreement, as applicable, and such failure continues for a period of three (3) Trading Days, unless otherwise then prohibited by applicable federal securities laws;
(viii) the occurrence of any default under, redemption of or acceleration prior to maturity of at least an aggregate of $250,000 of Indebtedness;
(ix) bankruptcy, insolvency, reorganization or liquidation proceedings or other proceedings for the relief of debtors shall be instituted by or against the Company or any Subsidiary and, if instituted against the Company or any Subsidiary by a third party, shall not be dismissed within thirty (30) days of their initiation;
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(x) the commencement by the Company or any Subsidiary of a voluntary case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree, order, judgment or other similar document in respect of the Company or any Subsidiary in an involuntary case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable federal, state or foreign law, or the consent by it to the filing of such petition or to the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Company or any Subsidiary or of any substantial part of its property, or the making by it of an assignment for the benefit of creditors, or the execution of a composition of debts, or the occurrence of any other similar federal, state or foreign proceeding, or the admission by it in writing of its inability to pay its debts generally as they become due, the taking of corporate action by the Company or any Subsidiary in furtherance of any such action or the taking of any action by any Person to commence a Uniform Commercial Code foreclosure sale or any other similar action under federal, state or foreign law;
(xi) the entry by a court of (i) a decree, order, judgment or other similar document in respect of the Company or any Subsidiary of a voluntary or involuntary case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization or other similar law or (ii) a decree, order, judgment or other similar document adjudging the Company or any Subsidiary as bankrupt or insolvent, or approving as properly filed a petition seeking liquidation, reorganization, arrangement, adjustment or composition of or in respect of the Company or any Subsidiary under any applicable federal, state or foreign law or (iii) a decree, order, judgment or other similar document appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Company or any Subsidiary or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance of any such decree, order, judgment or other similar document or any such other decree, order, judgment or other similar document unstayed and in effect for a period of sixty (60) consecutive days;
(xii) a final judgment or judgments for the payment of money aggregating in excess of $250,000 are rendered against the Company and/or any of its Subsidiaries and which judgments are not, within thirty (30) days after the entry thereof, bonded, discharged, settled or stayed pending appeal, or are not discharged within thirty (30) days after the expiration of such stay; provided, however, any judgment which is covered by insurance or an indemnity from a credit worthy party shall be deducted in calculating the $250,000 amount set forth above so long as the Company provides each Holder a written statement from such insurer or indemnity provider (which written statement shall be reasonably satisfactory to the Required Holders) to the effect that such judgment is covered by insurance or an indemnity and the Company or such Subsidiary (as the case may be) will receive the proceeds of such insurance or indemnity within thirty (30) days of the issuance of such judgment;
(xiii) the Company and/or any Subsidiary, individually or in the aggregate, either (i) fails to pay, when due, or within any applicable grace period, any payment with respect to any Indebtedness in excess of $250,000 due to any third party (other than payments contested by the Company and/or such Subsidiary (as the case may be) in good faith by proper proceedings and with respect to which adequate reserves have been set aside for the payment thereof in accordance with GAAP) or is otherwise in breach or violation of any agreement for monies owed or owing in an amount in excess of $250,000, which breach or violation permits the other party thereto to declare a default or otherwise accelerate amounts due thereunder, or (ii) suffer to exist any other circumstance or event that would, with or without the passage of time or the giving of notice, result in a default or event of default under any agreement binding the Company or any Subsidiary, which default or event of default would or is likely to have a material adverse effect on the business, assets, operations (including results thereof), liabilities, properties, condition (including financial condition) or prospects of the Company or any of its Subsidiaries, individually or in the aggregate;
(xiv) other than as specifically set forth in another clause of this Section 5(a), the Company or any Subsidiary breaches any representation or warranty or any covenant or other term or condition of any Transaction Document in any material respect, except, in the case of a breach of a covenant or other term or condition that is curable, only if such breach remains uncured for a period of ten (10) Business Days;
(xv) the Company’s failure to file the Registration Statement and have it declared effective pursuant to and in accordance with the terms and conditions of Section 5.4 of the Securities Purchase Agreement (including any additional Registration Statement required to be filed thereunder);
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(xvi) the Company’s failure to comply with the reporting requirements of the 1934 Act (including but not limited to becoming delinquent in its filings), which failure continues for a period of five (5) consecutive Business Days; and/or the Company shall cease to be subject to the reporting requirements of the 1934 Act for a period of one (1) or more Business Days;
(xvii) any Material Adverse Effect occurs;
(xviii) any provision of any Transaction Document shall at any time for any reason (other than pursuant to the express terms thereof) cease to be valid and binding on or enforceable against the Company, or the validity or enforceability thereof shall be contested, directly or indirectly, by the Company or any Subsidiary, or a proceeding shall be commenced by the Company or any Subsidiary or any Governmental Authority having jurisdiction over any of them, seeking to establish the invalidity or unenforceability thereof or the Company or any of its Subsidiaries shall deny in writing that it has any liability or obligation purported to be created under one or more Transaction Documents;
(xix) there shall be any SEC or judicial stop trade order or trading suspension stop-order or any restriction in place with the transfer agent for the Common Stock restricting the trading of such Common Stock, which order or restriction remains in effect for a period of five (5) consecutive Trading Days;
(xx) the DTC places any restrictions on transactions in the Common Stock or the Common Stock is no longer tradeable through the Depository Trust Company Fast Automated Securities Transfer program, which restriction or ineligibility continues for a period of five (5) consecutive Trading Days; or
(xxi) if the Company is required to seek the approval of its stockholders pursuant to Section 5.19 of the Securities Purchase Agreement, the Company’s failure to comply with the terms of such Section 5.19.
(b) Notice of a Triggering Event. Upon the occurrence of a Triggering Event with respect to the Preferred Shares, the Company shall within one (1) Business Day deliver written notice thereof via electronic mail and overnight courier (with next day delivery specified) (a “Triggering Event Notice”) to each Holder.
(c) Remedies. Upon the occurrence of any Triggering Event, the Stated Value of each outstanding Preferred Share shall be increased by fifteen percent (15%) (the “Default Premium”), and such increased amount shall thereafter constitute the Stated Value of such share for all purposes of this Certificate of Designations (including, without limitation, for purposes of the conversion provisions of Section 4); provided, that the Stated Value of any share shall not be increased pursuant to a Triggering Event on more than one occasion. Additionally, upon the occurrence and continuance of each and any Triggering Event, dividends on the Preferred Shares shall automatically accrue at the annual rate of 5% (“Default Dividend”), and shall be payable monthly in cash, or at the option of the Company, by adding the amount of such dividend to the Stated Value of each outstanding Preferred Share (which increased amount shall thereafter constitute the Stated Value of such share for all purposes of this Certificate of Designations). The Default Premium and Default Dividend shall be in addition to, and not in lieu of, any other rights or remedies available to the Holders under this Certificate of Designations, at law or in equity. If a Triggering Event remains uncured, a Holder may also require the Company, by written notice to the Company in accordance with this Certificate of Designations, to apply up to twenty-five percent (25%) of the gross cash proceeds of each financing (whether debt, equity or otherwise) consummated by the Company after the date of such Triggering Event to the redemption of such Holder’s Preferred Shares for cash at a price per Preferred Share equal to the Company Optional Redemption Price (calculated as of the date of such redemption), with such proceeds to be applied pro rata among all Holders exercising such right based on the number of Preferred Shares then held by each such Holder.
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6. Rights Upon Fundamental Transactions.
(a) Assumption; Redemption in Lieu of Assumption. The Company shall not enter into or be party to a Fundamental Transaction unless, at the option of the Company, either (i) the Successor Entity assumes in writing all of the obligations of the Company under this Certificate of Designations and the other Transaction Documents in accordance with the provisions of this Section 6(a) pursuant to written agreements in form and substance reasonably satisfactory to the Required Holders, including agreements to deliver to each holder of Preferred Shares in exchange for such Preferred Shares a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Certificate of Designations, including, without limitation, having a stated value and dividend rate equal to the stated value and dividend rate of the Preferred Shares held by the Holders and having similar ranking to the Preferred Shares (and the execution and delivery of such written assumption, and the delivery of a security satisfying the requirements of this clause (i), shall be deemed to satisfy this Section 6(a) without any requirement that any such agreement, instrument or security be satisfactory to, or consented to or approved by, any Holder or the Required Holders), or (ii) all outstanding Preferred Shares are redeemed in full in cash at or prior to the consummation of such Fundamental Transaction at a price per Preferred Share equal to the Company Optional Redemption Price (calculated as of the date of consummation of such Fundamental Transaction), in which case no assumption or exchange security pursuant to clause (i) shall be required. Notwithstanding the foregoing, if, as a result of the Fundamental Transaction, the common stock of the Company (or the securities issued in exchange therefor in the Fundamental Transaction) will not be listed on a national securities exchange following consummation of such transaction, or the Fundamental Transaction will otherwise result in the Company ceasing to be publicly traded on a national securities exchange, each Holder may, at its sole option and by written notice to the Company, elect to have all or any portion of the Preferred Shares held by such Holder redeemed in full in cash at or prior to the consummation of such Fundamental Transaction at the price per Preferred Share specified in clause (ii) above. Upon the occurrence of any Fundamental Transaction to which clause (i) of the first sentence of this Section 6(a) applies, the Successor Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Certificate of Designations and the other Transaction Documents referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Certificate of Designations and the other Transaction Documents with the same effect as if such Successor Entity had been named as the Company herein and therein. Notwithstanding the foregoing, any Holder may elect, at its sole option, by delivery of written notice to the Company to waive this Section 6(a) to permit the Fundamental Transaction without the assumption of the Preferred Shares. For the avoidance of doubt, no consent or approval of any Holder or the Required Holders shall be required for the Company to enter into or consummate any Fundamental Transaction effected in compliance with this Section 6(a). The provisions of this Section 6 shall apply similarly and equally to successive Fundamental Transactions and shall be applied without regard to any limitations on the conversion or redemption of the Preferred Shares.
7. Rights Upon Issuance of Purchase Rights and Other Corporate Events.
(a) Purchase Rights. In addition to any adjustments pursuant to Section 15 below, if at any time the Company grants, issues or sells any Options, Convertible Securities or rights to purchase stock, warrants, securities or other property pro rata to all or substantially all of the record holders of any class of Common Stock (the “Purchase Rights”), then each Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which such Holder could have acquired if such Holder had held the number of shares of Common Stock acquirable upon complete conversion of all the Preferred Shares (without taking into account any limitations or restrictions on the convertibility of the Preferred Shares and assuming for such purpose that all the Preferred Shares were converted at the Floor Price or Adjusted Floor Price, as applicable, as of the applicable record date) held by such Holder immediately prior to the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights; provided, however, to the extent that such Holder’s right to participate in any such Purchase Right would result in such Holder and the other Attribution Parties exceeding the Maximum Percentage, then such Holder shall not be entitled to participate in such Purchase Right to such extent of the Maximum Percentage (and shall not be entitled to beneficial ownership of such shares of Common Stock as a result of such Purchase Right (and beneficial ownership) to such extent of any such excess) and such Purchase Right to such extent shall be held in abeyance (and, if such Purchase Right has an expiration date, maturity date or other similar provision, such term shall be extended by such number of days held in abeyance, if applicable) for the benefit of such Holder until such time or times, if ever, as its right thereto would not result in such Holder and the other Attribution Parties exceeding the Maximum Percentage, at which time or times such Holder shall be granted such right (and any Purchase Right granted, issued or sold on such initial Purchase Right or on any subsequent Purchase Right held similarly in abeyance (and, if such Purchase Right has an expiration date, maturity date or other similar provision, such term shall be extended by such number of days held in abeyance, if applicable)) to the same extent as if there had been no such limitation.
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(b) Other Corporate Events. In addition to and not in substitution for any other rights hereunder, prior to the consummation of any Fundamental Transaction pursuant to which holders of shares of Common Stock are entitled to receive securities or other assets with respect to or in exchange for shares of Common Stock (a “Corporate Event”), the Company shall make appropriate provision to ensure that each Holder will thereafter have the right, at such Holder’s option, to receive upon a conversion of all the Preferred Shares held by such Holder (i) such securities or other assets (the “Corporate Event Consideration”) to which such Holder would have been entitled with respect to such shares of Common Stock had such shares of Common Stock been held by such Holder upon the consummation of such Corporate Event (without taking into account any limitations or restrictions on the convertibility of the Preferred Shares set forth in this Certificate of Designations) or (ii) in lieu of the shares of Common Stock otherwise receivable upon such conversion, such securities or other assets received by the holders of shares of Common Stock in connection with the consummation of such Corporate Event in such amounts as such Holder would have been entitled to receive had the Preferred Shares held by such Holder initially been issued with conversion rights for the form of such consideration (as opposed to shares of Common Stock) at a conversion rate for such consideration commensurate with the Conversion Rate. Any provision made pursuant to the preceding sentence shall be in form and substance reasonably satisfactory to the Required Holders. The provisions of this Section 7 shall apply similarly and equally to successive Corporate Events and shall be applied without regard to any limitations on the conversion or redemption of the Preferred Shares set forth in this Certificate of Designations.
8. Reserved.
9. Redemption at the Company’s Election.
(a) At any time, the Company shall have the right to redeem all, or any part, of the Preferred Shares then outstanding (the “Company Optional Redemption Amount”) on the Company Optional Redemption Date (each as defined below) (a “Company Optional Redemption”). The Preferred Shares subject to redemption pursuant to this Section 9 shall be redeemed by the Company in cash at a price (the “Company Optional Redemption Price”) equal to 110% of the sum of (i) the Stated Value being redeemed, (ii) any Additional Amount thereon as of the Company Optional Redemption Date and (iii) any other amounts thereon owed to such Holder pursuant to this Certificate of Designations or any other Transaction Document. The Company may exercise its right to require redemption under this Section 9 by delivering a written notice thereof by electronic mail and overnight courier to all, but not less than all, of the Holders (the “Company Optional Redemption Notice” and the date all of the Holders received such notice is referred to as the “Company Optional Redemption Notice Date”). The Company Optional Redemption Notice shall be irrevocable; provided that the Company Optional Redemption Notice may be conditioned upon the consummation of a refinancing transaction, a Fundamental Transaction or any other financing or strategic transaction specified in such notice. The Company Optional Redemption Notice shall (x) state the date on which the Company Optional Redemption shall occur (the “Company Optional Redemption Date”), which date shall be at least fifteen (15) Business Days following the Company Optional Redemption Notice Date, and (y) state the aggregate Stated Value of the Preferred Shares being redeemed from such Holder and all of the other Holders on the Company Optional Redemption Date. The Company shall deliver the applicable Company Optional Redemption Price to each Holder in cash on the applicable Company Optional Redemption Date. Notwithstanding anything herein to the contrary, at any time prior to the date the Company Optional Redemption Price is paid in full, the Company Optional Redemption Amount may be converted, in whole or in part, by any Holder into shares of Common Stock pursuant to Section 4. All Conversion Amounts converted by a Holder after the Company Optional Redemption Notice Date shall reduce the Company Optional Redemption Amount of the Preferred Shares of such Holder required to be redeemed on the Company Optional Redemption Date. In the event of the Company’s redemption of any of the Preferred Shares under this Section 9, a Holder’s damages would be uncertain and difficult to estimate because of the parties’ inability to predict future interest rates and the uncertainty of the availability of a suitable substitute investment opportunity for such Holder. Accordingly, any redemption premium due under this Section 9 is intended by the parties to be, and shall be deemed, a reasonable estimate of such Holder’s actual loss of its investment opportunity and not as a penalty. For the avoidance of doubt, the Company shall have no right to effect a Company Optional Redemption if any Triggering Event has occurred and is continuing, but any Triggering Event shall have no effect upon any Holder’s right to convert Preferred Shares in its discretion.
(b) If the Company elects to cause a Company Optional Redemption of the Preferred Shares pursuant to Section 9(a) above, then it must simultaneously take the same action with respect to all Holders on a pro rata basis.
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10. Noncircumvention. The Company hereby covenants and agrees that the Company will not, by amendment of its Articles of Incorporation, bylaws or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Certificate of Designations, and will at all times in good faith carry out all the provisions of this Certificate of Designations and take all action as may be required to protect the rights of the Holders hereunder. Without limiting the generality of the foregoing or any other provision of this Certificate of Designations or the other Transaction Documents, the Company (a) shall not increase the par value of any shares of Common Stock receivable upon the conversion of any Preferred Shares above the Conversion Price then in effect, (b) shall take all such actions as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and non-assessable shares of Common Stock upon the conversion of Preferred Shares and (c) shall, so long as any Preferred Shares are outstanding, take all action necessary to reserve and keep available out of its authorized and unissued shares of Common Stock, solely for the purpose of effecting the conversion of the Preferred Shares, the maximum number of shares of Common Stock as shall from time to time be necessary to effect the conversion of the Preferred Shares then outstanding (without regard to any limitations on conversion contained herein). Notwithstanding anything herein to the contrary, if after the sixty (60) calendar day anniversary of the Initial Issuance Date, each Holder is not permitted to convert such Holder’s Preferred Shares in full for any reason (other than pursuant to restrictions set forth in Section 4(d) hereof), the Company shall use its best efforts to promptly remedy such failure, including, without limitation, obtaining such consents or approvals as necessary to effect such conversion into shares of Common Stock.
11. Authorized Shares.
(a) Reservation. So long as any Preferred Shares remain outstanding, the Company shall at all times reserve at least 200% of the number of shares of Common Stock as shall from time to time be necessary to effect the conversion, including without limitation Alternate Conversions, of all of the Preferred Shares then outstanding (assuming for purposes hereof that (x) the Preferred Shares are convertible at the Floor Price or Adjusted Floor Price, as applicable, then in effect and (y) any such conversion shall not take into account any limitations on conversion of the Preferred Shares set forth herein) (the “Required Reserve Amount”). The Required Reserve Amount (including, without limitation, each increase in the number of shares so reserved) shall be allocated pro rata among the Holders based on the number of Preferred Shares held by each Holder on the Initial Issuance Date or increase in the number of reserved shares, as the case may be (the “Authorized Share Allocation”). In the event that a Holder shall sell or otherwise transfer any of such Holder’s Preferred Shares, each transferee shall be allocated a pro rata portion of such Holder’s Authorized Share Allocation. Any shares of Common Stock reserved and allocated to any Person that ceases to hold any Preferred Shares shall be allocated to the remaining Holders of Preferred Shares pro rata based on the number of Preferred Shares then held by the Holders. Notwithstanding the foregoing, a Holder may allocate its Authorized Share Allocation to any other securities of the Company held by such Holder (or any of its designees) by delivery of written notice to the Company.
(b) Insufficient Authorized Shares. If, notwithstanding Section 11(a) and not in limitation thereof, at any time while any of the Preferred Shares remain outstanding the Company does not have a sufficient number of authorized and unreserved shares of Common Stock to satisfy its obligation to reserve for issuance upon conversion of the Preferred Shares at least a number of shares of Common Stock equal to the Required Reserve Amount (an “Authorized Share Failure”), then the Company shall promptly take all action necessary to increase the Company’s authorized shares of Common Stock to an amount sufficient to allow the Company to reserve the Required Reserve Amount for the Preferred Shares then outstanding (or deemed outstanding pursuant to Section 11(a) above). Without limiting the generality of the foregoing sentence, as soon as practicable after the date of the occurrence of an Authorized Share Failure, but in no event later than thirty (30) days after the occurrence of such Authorized Share Failure, the Company shall hold a meeting of its stockholders for the approval of an increase in the number of authorized shares of Common Stock. If the requisite stockholder approval is not obtained at any meeting of stockholders held pursuant to this Section 11(b), the Company shall, within five (5) Business Days following such meeting, commence all actions necessary to seek such approval again and shall continue to seek such approval at successive meetings of stockholders until such approval is obtained. The Company shall file the preliminary proxy statement or other applicable solicitation materials for each subsequent meeting as promptly as practicable, but in no event later than twenty (20) calendar days following the immediately preceding meeting, and shall cause each subsequent meeting to be held as promptly as permitted under applicable law and SEC rules. In connection with such meeting, the Company shall provide each stockholder with a proxy statement and shall use its best efforts to solicit its stockholders’ approval of such increase in authorized shares of Common Stock and to cause its Board to recommend to the stockholders that they approve such proposal. Notwithstanding the foregoing, if at any such time of an Authorized Share Failure, the Company is able to obtain the written consent of a majority of the shares of its issued and outstanding shares of Common Stock to approve the increase in the number of authorized shares of Common Stock, the Company shall satisfy this obligation by obtaining such consent and submitting for filing with the SEC an Information Statement on Schedule 14C. In the event that the Company is prohibited from issuing shares of Common Stock to a Holder upon any conversion due to the failure by the Company to have sufficient shares of Common Stock available out of the authorized but unissued shares of Common Stock (such unavailable number of shares of Common Stock, the “Authorized Failure Shares”), in lieu of delivering such Authorized Failure Shares to such Holder, the Company shall pay cash in exchange for the redemption of such portion of the Conversion Amount of the Preferred Shares convertible into such Authorized Failure Shares at a price equal to the sum of (i) the product of (x) such number of Authorized Failure Shares and (y) the greatest Closing Sale Price of the Common Stock on any Trading Day during the period commencing on the date such Holder delivers the applicable Conversion Notice with respect to such Authorized Failure Shares to the Company and ending on the date of such issuance and payment under this Section 11(b); and (ii) to the extent such Holder purchases (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by such Holder of Authorized Failure Shares, any brokerage commissions and other out-of-pocket expenses, if any, of such Holder incurred in connection therewith. Nothing contained in Section 11(a) or this Section 11(b) shall limit any obligations of the Company under any provision any of the Transaction Documents.
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12. Voting Rights. The holders of the Preferred Shares shall have no voting power and no right to vote on any matter at any time, either as a separate series or class or together with any other series or class of share of capital stock, and shall not be entitled to call a meeting of such holders for any purpose nor shall they be entitled to participate in any meeting of the holders of Common Stock, except as provided in this Section 12 and Section 16 or as otherwise required by the NRS. To the extent that under the NRS the vote of the holders of the Preferred Shares, voting separately as a class or series, as applicable, is required to authorize a given action of the Company, the affirmative vote or consent of the Required Holders of the Preferred Shares, voting together in the aggregate and not in separate series unless required under the NRS, represented at a duly held meeting at which a quorum is presented or by written consent of the Required Holders (except as otherwise may be required under the NRS), voting together in the aggregate and not in separate series unless required under the NRS, shall constitute the approval of such action by both the class or the series, as applicable. Holders of the Preferred Shares shall be entitled to written notice of all stockholder meetings or written consents (and copies of proxy materials and other information sent to stockholders) with respect to which they would be entitled to vote, which notice would be provided pursuant to the Company’s bylaws (the “Bylaws”) and the NRS.
13. Covenants. Without the prior consent of the Required Holders:
(a) Restriction on Redemption and Cash Dividends. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly, redeem, repurchase or declare or pay any cash dividend or distribution on any of its Junior Stock or Parity Stock (other than as required by this Certificate of Designations).
(b) Preservation of Existence, Etc. The Company shall maintain and preserve, and cause each of its Subsidiaries to maintain and preserve, its existence, rights and privileges, and become or remain, and cause each of its Subsidiaries to become or remain, duly qualified and in good standing in each jurisdiction in which the character of the properties owned or leased by it or in which the transaction of its business makes such qualification necessary, except where the failure to become or remain duly qualified or in good standing could not reasonably be expected to result in a Material Adverse Effect.
(c) Maintenance of Properties, Etc. The Company shall maintain and preserve, and cause each of its Subsidiaries to maintain and preserve, all of its material properties which are necessary or useful in the proper conduct of its business in good working order and condition, ordinary wear and tear excepted, and comply, and cause each of its Subsidiaries to materially comply, at all times with the provisions of all leases to which it is a party as lessee or under which it occupies property, so as to prevent any loss or forfeiture thereof or thereunder.
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(d) Maintenance of Intellectual Property. The Company will, and will cause each of its Subsidiaries to, take all action necessary or advisable to maintain all of the Intellectual Property Rights of the Company and/or any of its Subsidiaries that are necessary or material to the conduct of its business in full force and effect.
(e) Maintenance of Insurance. The Company shall maintain, and cause each of its Subsidiaries to maintain, insurance with responsible and reputable insurance companies or associations (including, without limitation, comprehensive general liability, hazard, rent and business interruption insurance) with respect to its properties (including all real properties leased or owned by it) and business, in such amounts and covering such risks as is required by any Governmental Authority having jurisdiction with respect thereto or as is carried generally in accordance with sound business practice by companies in similar businesses similarly situated.
(f) Restricted Issuances. The Company shall not, directly or indirectly, without the prior written consent of the Required Holders, (i) issue any Preferred Shares (other than in accordance with the Securities Purchase Agreement or in compliance with Section 2 of this Certificate of Designation), or (ii) issue any securities that rank senior or pari passu to the Preferred Shares or any other securities that would cause a breach or default under this Certificate of Designations. For the avoidance of doubt, except as expressly set forth in the immediately preceding sentence or elsewhere in this Certificate of Designations, nothing herein shall require the consent of, or grant any consent or approval right to, any Holder with respect to the issuance by the Company of any shares of Common Stock, Options, Convertible Securities or other securities, the incurrence or guarantee of any Indebtedness, or any other equity or debt financing or capital-raising transaction of the Company or any Subsidiary.
14. Liquidation, Dissolution, Winding-Up. In the event of a Liquidation Event, the Holders shall be entitled to receive in cash out of the assets of the Company, whether from capital or from earnings available for distribution to its stockholders (the “Liquidation Funds”), before any amount shall be paid to the holders of any of shares of Junior Stock, but pari passu with any Parity Stock then outstanding, an amount per Preferred Share equal to the greater of (A) the Conversion Amount of such Preferred Share (with no change to clause (1) of the definition thereof) on the date of such payment and (B) the amount per share such Holder would receive if such Holder converted such Preferred Share into Common Stock immediately prior to the date of such payment, provided that if the Liquidation Funds are insufficient to pay the full amount due to the Holders and holders of shares of Parity Stock, then each Holder and each holder of Parity Stock shall receive a percentage of the Liquidation Funds equal to the full amount of Liquidation Funds payable to such Holder and such holder of Parity Stock as a liquidation preference, in accordance with their respective certificate of designations (or equivalent), as a percentage of the full amount of Liquidation Funds payable to all holders of Preferred Shares and all holders of shares of Parity Stock. To the extent necessary, the Company shall cause such actions to be taken by each of its Subsidiaries so as to enable, to the maximum extent permitted by law, the proceeds of a Liquidation Event to be distributed to the Holders in accordance with this Section 14. All the preferential amounts to be paid to the Holders under this Section 14 shall be paid or set apart for payment before the payment or setting apart for payment of any amount for, or the distribution of any Liquidation Funds of the Company to the holders of shares of Junior Stock in connection with a Liquidation Event as to which this Section 14 applies.
15. Distribution of Assets. In addition to any adjustments pursuant to Section 7 and Section 8, if the Company shall declare or make any dividend or other distributions of its assets (or rights to acquire its assets) to any or all holders of shares of Common Stock, by way of return of capital or otherwise (including without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (the “Distributions”), then each Holder, as holders of Preferred Shares, will be entitled to such Distributions as if such Holder had held the number of shares of Common Stock acquirable upon complete conversion of the Preferred Shares (without taking into account any limitations or restrictions on the convertibility of the Preferred Shares and assuming for such purpose that all the Preferred Shares were converted at the Alternate Conversion Price as of the applicable record date) immediately prior to the date on which a record is taken for such Distribution or, if no such record is taken, the date as of which the record holders of Common Stock are to be determined for such Distributions (provided, however, that to the extent that such Holder’s right to participate in any such Distribution would result in such Holder and the other Attribution Parties exceeding the Maximum Percentage, then such Holder shall not be entitled to participate in such Distribution to such extent of the Maximum Percentage (and shall not be entitled to beneficial ownership of such shares of Common Stock as a result of such Distribution (and beneficial ownership) to such extent of any such excess) and the portion of such Distribution shall be held in abeyance for the benefit of such Holder until such time or times as its right thereto would not result in such Holder and the other Attribution Parties exceeding the Maximum Percentage, at which time or times, if any, such Holder shall be granted such Distribution (and any Distributions declared or made on such initial Distribution or on any subsequent Distribution held similarly in abeyance) to the same extent as if there had been no such limitation).
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16. Vote to Change the Terms of or Issue Preferred Shares. In addition to any other rights provided by law, except where the vote or written consent of the holders of a greater number of shares is required by law or by another provision of the Articles of Incorporation, without first obtaining the affirmative vote at a meeting duly called for such purpose or the written consent without a meeting of the Required Holders, voting together as a single class, the Company shall not: (a) amend or repeal any provision of, or add any provision to, its Articles of Incorporation (other than this Certificate of Designations, which is covered by Section 30) or bylaws, or file any certificate of designations or articles of amendment of any series of shares of preferred stock, if such action would adversely alter or change in any respect the preferences, rights, privileges or powers, or restrictions provided for the benefit of the Preferred Shares hereunder, regardless of whether any such action shall be by means of amendment to the Articles of Incorporation or by merger, consolidation or otherwise, other than as contemplated hereby or in accordance with the Securities Purchase Agreement; provided, that the authorization, creation or issuance of any Senior Preferred Stock, Parity Stock or Junior Stock in accordance with this Certificate of Designations (including Section 2), and the filing of any certificate of designations or articles of amendment with respect thereto, shall not, in and of itself, be deemed to adversely alter or change the preferences, rights, privileges or powers of, or the restrictions provided for the benefit of, the Preferred Shares; provided the Company complies with any applicable Required Holders consent obligations hereunder; (b) create or authorize (by reclassification or otherwise), or issue, any new class or series of Senior Preferred Stock or Parity Stock unless the Required Holders have consented thereto in accordance with Section 2 hereof; (c) purchase, repurchase or redeem any shares of Junior Stock, other than pursuant to the terms of the Company’s equity incentive plans and options and other equity awards granted under such plans; (d) pay dividends or make any other distribution on any shares of Junior Stock; (e) increase or decrease the authorized number of shares of Series A Convertible Preferred Stock, other than as contemplated hereby or in accordance with the Securities Purchase Agreement; (f) issue any Preferred Shares, other than as contemplated hereby or in accordance with the Securities Purchase Agreement; or (g) without limiting any provision of Section 10, whether or not prohibited by the terms of the Preferred Shares, circumvent a right of the Preferred Shares hereunder.
17. Transfer of Preferred Shares. A Holder may offer, sell or transfer some or all of its Preferred Shares without the consent of the Company subject to applicable securities laws and Section 9.4 of the Securities Purchase Agreement.
18. Reissuance of Preferred Share Certificates and Book Entries.
(a) Transfer. If any Preferred Shares are to be transferred, the applicable Holder shall surrender the applicable Preferred Share Certificate to the Company (or, if the Preferred Shares are held in Book-Entry form, a written instruction letter to the Company), whereupon the Company will forthwith issue and deliver upon the order of such Holder a new Preferred Share Certificate (in accordance with Section 18(d)) (or evidence of the transfer of such Book-Entry), registered as such Holder may request, representing the outstanding number of Preferred Shares being transferred by such Holder and, if less than the entire outstanding number of Preferred Shares is being transferred, a new Preferred Share Certificate (in accordance with Section 18(d)) to such Holder representing the outstanding number of Preferred Shares not being transferred (or evidence of such remaining Preferred Shares in a Book-Entry for such Holder). Such Holder and any assignee, by acceptance of the Preferred Share Certificate or evidence of Book-Entry issuance, as applicable, acknowledge and agree that, by reason of the provisions of Section 4(c)(iii) following conversion or redemption of any of the Preferred Shares, the outstanding number of Preferred Shares represented by the Preferred Share Certificates or Book-Entry may be less than the number of Preferred Shares stated on the face of the Preferred Share Certificates or Book-Entry.
(b) Lost, Stolen or Mutilated Preferred Share Certificate. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of a Preferred Share Certificate (as to which a written certification and the indemnification contemplated below shall suffice as such evidence), and, in the case of loss, theft or destruction, of any indemnification undertaking by the applicable Holder to the Company in customary and reasonable form and, in the case of mutilation, upon surrender and cancellation of such Preferred Share Certificate, the Company shall execute and deliver to such Holder a new Preferred Share Certificate (in accordance with Section 18(d)) representing the applicable outstanding number of Preferred Shares.
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(c) Preferred Share Certificate and Book-Entries Exchangeable for Different Denominations and Forms. Each Preferred Share Certificate is exchangeable, upon the surrender hereof by the applicable Holder at the principal office of the Company, for a new Preferred Share Certificate or Preferred Share Certificate(s) or new Book-Entry (in accordance with Section 18(d)) representing, in the aggregate, the outstanding number of the Preferred Shares in the original Preferred Share Certificate, and each such new Preferred Share Certificate and/or new Book-Entry, as applicable, will represent such portion of such outstanding number of Preferred Shares from the original Preferred Share Certificate as is designated in writing by such Holder at the time of such surrender. Each Book-Entry may be exchanged into one or more new Preferred Share Certificates or split by the applicable Holder by delivery of a written notice to the Company into two or more new Book-Entries (in accordance with Section 18(d)) representing, in the aggregate, the outstanding number of the Preferred Shares in the original Book-Entry, and each such new Book-Entry and/or new Preferred Share Certificate, as applicable, will represent such portion of such outstanding number of Preferred Shares from the original Book-Entry as is designated in writing by such Holder at the time of such surrender.
(d) Issuance of New Preferred Share Certificate or Book-Entry. Whenever the Company is required to issue a new Preferred Share Certificate or a new Book-Entry pursuant to the terms of this Certificate of Designations, such new Preferred Share Certificate or new Book-Entry (i) shall represent, as indicated on the face of such Preferred Share Certificate or in such Book-Entry, as applicable, the number of Preferred Shares remaining outstanding (or in the case of a new Preferred Share Certificate or new Book-Entry being issued pursuant to Section 18(a) or Section 18(c), the number of Preferred Shares designated by such Holder) which, when added to the number of Preferred Shares represented by the other new Preferred Share Certificates or other new Book-Entry, as applicable, issued in connection with such issuance, does not exceed the number of Preferred Shares remaining outstanding under the original Preferred Share Certificate or original Book-Entry, as applicable, immediately prior to such issuance of new Preferred Share Certificate or new Book-Entry, as applicable, and (ii) shall have an issuance date, as indicated on the face of such new Preferred Share Certificate or in such new Book-Entry, as applicable, which is the same as the issuance date of the original Preferred Share Certificate or in such original Book-Entry, as applicable.
19. Remedies, Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Certificate of Designations shall be cumulative and in addition to all other remedies available under this Certificate of Designations and any of the other Transaction Documents, at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit any Holder’s right to pursue actual and consequential damages for any failure by the Company to comply with the terms of this Certificate of Designations. The Company covenants to each Holder that there shall be no characterization concerning this instrument other than as expressly provided herein. Amounts set forth or provided for herein with respect to payments, conversion and the like (and the computation thereof) shall be the amounts to be received by a Holder and shall not, except as expressly provided herein, be subject to any other obligation of the Company (or the performance thereof). The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holders and that the remedy at law for any such breach may be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach, each Holder shall be entitled, in addition to all other available remedies, to specific performance and/or temporary, preliminary and permanent injunctive or other equitable relief from any court of competent jurisdiction in any such case without the necessity of proving actual damages and without posting a bond or other security. The Company shall provide all information and documentation to a Holder that is requested by such Holder to enable such Holder to confirm the Company’s compliance with the terms and conditions of this Certificate of Designations.
20. Payment of Collection, Enforcement and Other Costs. If (a) any Preferred Shares are placed in the hands of an attorney for collection or enforcement or is collected or enforced through any legal proceeding or a Holder otherwise takes action to collect amounts due under this Certificate of Designations with respect to the Preferred Shares or to enforce the provisions of this Certificate of Designations or (b) there occurs any bankruptcy, reorganization, receivership of the Company or other proceedings affecting Company creditors’ rights and involving a claim under this Certificate of Designations, then the Company shall pay the costs reasonably incurred by such Holder for such collection, enforcement or action or in connection with such bankruptcy, reorganization, receivership or other proceeding, including, without limitation, attorneys’ fees and disbursements. The Company expressly acknowledges and agrees that no amounts due under this Certificate of Designations with respect to any Preferred Shares shall be affected, or limited, by the fact that the purchase price paid for each Preferred Share was less than the original Stated Value thereof.
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21. Construction; Headings. This Certificate of Designations shall be deemed to be jointly drafted by the Company and the Holders and shall not be construed against any such Person as the drafter hereof. The headings of this Certificate of Designations are for convenience of reference and shall not form part of, or affect the interpretation of, this Certificate of Designations. Unless the context clearly indicates otherwise, each pronoun herein shall be deemed to include the masculine, feminine, neuter, singular and plural forms thereof. The terms “including,” “includes,” “include” and words of like import shall be construed broadly as if followed by the words “without limitation.” The terms “herein,” “hereunder,” “hereof” and words of like import refer to this entire Certificate of Designations instead of just the provision in which they are found. Unless expressly indicated otherwise, all section references are to sections of this Certificate of Designations. Terms used in this Certificate of Designations and not otherwise defined herein, but defined in the other Transaction Documents, shall have the meanings ascribed to such terms on the Initial Issuance Date in such other Transaction Documents unless otherwise consented to in writing by the Required Holders.
22. Failure or Indulgence Not Waiver. No failure or delay on the part of a Holder in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privilege. In addition, the exercise of any right or remedy of a Holder at law or equity or under this Certificate of Designations or any of the Transaction Documents shall not be deemed to be an election of such Holder’s rights or remedies under such documents or at law or equity. No waiver shall be effective unless it is in writing and signed by an authorized representative of the waiving party. This Certificate of Designations shall be deemed to be jointly drafted by the Company and all Holders and shall not be construed against any Person as the drafter hereof. Notwithstanding the foregoing, nothing contained in this Section 22 shall permit any waiver of any provision of Section 4(d).
23. Dispute Resolution.
(a) Submission to Dispute Resolution.
(i) In the case of a dispute relating to a Closing Bid Price, a Closing Sale Price, a Conversion Price, an Alternate Conversion Price, a VWAP or a fair market value or the arithmetic calculation of a Conversion Rate, or the applicable redemption price (as the case may be) (including, without limitation, a dispute relating to the determination of any of the foregoing), the Company or the applicable Holder (as the case may be) shall submit the dispute to the other party via electronic mail (A) if by the Company, within two (2) Business Days after the occurrence of the circumstances giving rise to such dispute or (B) if by such Holder at any time after such Holder learned of the circumstances giving rise to such dispute. If such Holder and the Company are unable to promptly resolve such dispute relating to such Closing Bid Price, such Closing Sale Price, such Conversion Price, such Alternate Conversion Price, such VWAP or such fair market value, or the arithmetic calculation of such Conversion Rate or such applicable redemption price (as the case may be), at any time after the second (2nd) Business Day following such initial notice by the Company or such Holder (as the case may be) of such dispute to the Company or such Holder (as the case may be), then such Holder may, with the consent of the Company (not to be unreasonably withheld, conditioned or delayed), select an independent, reputable investment bank to resolve such dispute.
(ii) Such Holder and the Company shall each deliver to such investment bank (A) a copy of the initial dispute submission so delivered in accordance with the first sentence of this Section 23 and (B) written documentation supporting its position with respect to such dispute, in each case, no later than 5:00 p.m. (New York time) by the fifth (5th) Business Day immediately following the date on which such Holder selected such investment bank (the “Dispute Submission Deadline”) (the documents referred to in the immediately preceding clauses (A) and (B) are collectively referred to herein as the “Required Dispute Documentation”) (it being understood and agreed that if either such Holder or the Company fails to so deliver all of the Required Dispute Documentation by the Dispute Submission Deadline, then the party who fails to so submit all of the Required Dispute Documentation shall no longer be entitled to (and hereby waives its right to) deliver or submit any written documentation or other support to such investment bank with respect to such dispute and such investment bank shall resolve such dispute based solely on the Required Dispute Documentation that was delivered to such investment bank prior to the Dispute Submission Deadline). Unless otherwise agreed to in writing by both the Company and such Holder or otherwise requested by such investment bank, neither the Company nor such Holder shall be entitled to deliver or submit any written documentation or other support to such investment bank in connection with such dispute (other than the Required Dispute Documentation).
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(iii) The Company and the Holder shall cause such investment bank to determine the resolution of such dispute and notify the Company and the Holder of such resolution no later than ten (10) Business Days immediately following the Dispute Submission Deadline. The fees and expenses of such investment bank shall be borne solely by the Company, and such investment bank’s resolution of such dispute shall be final and binding upon all parties absent manifest error. During the pendency of any dispute pursuant to this Section 23, the Company shall timely perform all obligations under this Certificate of Designations that are not the subject of such dispute, and no such dispute shall excuse or delay any conversion, payment, redemption or other performance to the extent not dependent upon the matter in dispute.
(b) Miscellaneous. The Company and each Holder acknowledge and agree that the procedures in this Section 23 constitute a binding expert-determination mechanism for the valuation and calculation disputes described herein and not an agreement to arbitrate. The terms of this Certificate of Designations and the other applicable Transaction Documents shall serve as the basis for the investment bank’s determination. The investment bank may make the findings and calculations reasonably necessary to resolve the submitted dispute, and its determination shall be final and binding absent manifest error. Nothing in this Section 23 limits either party’s right to seek temporary, preliminary or permanent injunctive relief or to enforce the expert determination in the courts specified in Section 26.
24. Notices; Currency; Payments.
(a) Notices.
(i) Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Certificate of Designations must be in writing and will be deemed to have been delivered on the earliest of: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by electronic mail (provided that such sent email is kept on file (whether electronically or otherwise) by the sending party and the sending party does not receive an automatically generated message from the recipient’s email server that such e-mail could not be delivered to such recipient); or (iii) one (1) Business Day after deposit with an overnight courier service with next day delivery specified, in each case, properly addressed to the party to receive the same. Notwithstanding the foregoing, any notice, consent, waiver or other communication delivered by any method other than electronic mail shall also be sent by electronic mail to the applicable recipient at the e-mail address specified herein. The mailing address and e-mail address for any such communications to the Company shall be: Tigerless AI Holdings Inc., [ADDRESS], Attention: Zikang Wu, Chief Executive Officer, e-mail address: [EMAIL], or such other mailing address and/or e-mail address as the Company has specified by written notice given to each of the Holders in accordance with this Section 24(a) not later than five (5) days prior to the effectiveness of such change. The mailing address and e-mail address for any such communications to any Holder shall be as set forth on such Holder’s respective signature page to the Securities Purchase Agreement, or such other mailing address and/or e-mail address as such Holder has specified by written notice given to the Company in accordance with this Section 24(a) not later than five (5) days prior to the effectiveness of such change. Written confirmation of receipt (A) given by the recipient of such notice, consent, waiver or other communication, (B) mechanically or electronically generated by the sender’s e-mail containing the time, date and recipient’s e-mail or (C) provided by an overnight courier service shall be rebuttable evidence of personal service, receipt by e-mail or receipt from an overnight courier service in accordance with clause (i), (ii) or (iii) above, respectively.
(ii) The Company shall provide each Holder with prompt written notice by electronic mail of all actions taken pursuant to this Certificate of Designations, including in reasonable detail a description of such action and the reason therefore. Without limiting the generality of the foregoing, the Company shall give written notice to each Holder (i) immediately upon any adjustment of the Conversion Price, setting forth in reasonable detail, and certifying, the calculation of such adjustment and (ii) at least fifteen (15) days prior to the date on which the Company closes its books or takes a record (A) with respect to any dividend or distribution upon the Common Stock, or (B) for determining rights to vote with respect to any Fundamental Transaction, dissolution or liquidation, provided in each case that such information shall be made known to the public prior to or in conjunction with such notice being provided to such Holder.
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(b) Currency. All dollar amounts referred to in this Certificate of Designations are in United States Dollars (“U.S. Dollars”), and all amounts owing under this Certificate of Designations shall be paid in U.S. Dollars. All amounts denominated in other currencies (if any) shall be converted into the U.S. Dollar equivalent amount in accordance with the Exchange Rate on the date of calculation. “Exchange Rate” means, in relation to any amount of currency to be converted into U.S. Dollars pursuant to this Certificate of Designations, the U.S. Dollar exchange rate as published in the Wall Street Journal on the relevant date of calculation (it being understood and agreed that where an amount is calculated with reference to, or over, a period of time, the date of calculation shall be the final date of such period of time).
(c) Payments. Whenever any payment of cash is to be made by the Company to any Person pursuant to this Certificate of Designations, unless otherwise expressly set forth herein, such payment shall be made in lawful money of the United States of America by wire transfer of immediately available funds pursuant to wire transfer instructions provided by such Person to the Company in writing, provided that if no wire transfer instructions have been so provided, such payment may be made by certified check drawn on the account of the Company and sent via overnight courier service to such Person at such address as previously provided to the Company in writing (which address, in the case of each of the Holders, shall initially be the address for notice).. Whenever any amount expressed to be due by the terms of this Certificate of Designations is due on any day which is not a Business Day, the same shall instead be due on the next succeeding day which is a Business Day.
25. Waiver of Notice. To the extent permitted by law, the Company hereby irrevocably waives demand, notice, presentment, protest and all other demands and notices in connection with the delivery, acceptance, performance, default or enforcement of this Certificate of Designations and the Securities Purchase Agreement.
26. Governing Law. This Certificate of Designations shall be construed and enforced in accordance with, and all questions concerning the construction, validity, interpretation and performance of this Certificate of Designations shall be governed by, the internal laws of the State of Nevada and the NRS. Except as otherwise required by Section 23 above, the Company hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in New York County, New York, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Nothing contained herein (i) shall be deemed or operate to preclude any Holder from bringing suit or taking other legal action against the Company in any other jurisdiction to collect on the Company’s obligations to such Holder, to realize on any collateral or other security for such obligations, or to enforce a judgment or other court ruling in favor of such Holder or (ii) shall limit, or be deemed or construed to limit, any provision of Section 23 above. THE COMPANY AND EACH HOLDER HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS CERTIFICATE OF DESIGNATIONS OR ANY TRANSACTION CONTEMPLATED HEREBY.
27. Judgment Currency.
(a) If for the purpose of obtaining or enforcing judgment against the Company in any court in any jurisdiction it becomes necessary to convert into any other currency (such other currency being hereinafter in this Section 27 referred to as the “Judgment Currency”) an amount due in U.S. Dollars under this Certificate of Designations, the conversion shall be made at the Exchange Rate prevailing on the Trading Day immediately preceding:
(i) the date actual payment of the amount due, in the case of any proceeding in the courts of New York or in the courts of any other jurisdiction that will give effect to such conversion being made on such date: or
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(ii) the date on which the foreign court determines, in the case of any proceeding in the courts of any other jurisdiction (the date as of which such conversion is made pursuant to this Section 27(a)(ii) being hereinafter referred to as the “Judgment Conversion Date”).
(b) If in the case of any proceeding in the court of any jurisdiction referred to in Section 27(a)(ii) above, there is a change in the Exchange Rate prevailing between the Judgment Conversion Date and the date of actual payment of the amount due, the applicable party shall pay such adjusted amount as may be necessary to ensure that the amount paid in the Judgment Currency, when converted at the Exchange Rate prevailing on the date of payment, will produce the amount of US dollars which could have been purchased with the amount of Judgment Currency stipulated in the judgment or judicial order at the Exchange Rate prevailing on the Judgment Conversion Date.
(c) Any amount due from the Company under this provision shall be due as a separate debt and shall not be affected by judgment being obtained for any other amounts due under or in respect of this Certificate of Designations.
28. Severability. If any provision of this Certificate of Designations is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect the validity of the remaining provisions of this Certificate of Designations so long as this Certificate of Designations as so modified continues to express, without material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).
29. Maximum Payments. Nothing contained herein shall be deemed to establish or require the payment of a rate of interest or other charges in excess of the maximum permitted by applicable law. In the event that the rate of interest required to be paid or other charges hereunder exceed the maximum permitted by such law, any payments in excess of such maximum shall be applied to reduce other amounts then owing by the Company to the applicable Holder and, only to the extent no such amounts remain outstanding, refunded to the Company.
30. Stockholder Matters; Amendment.
(a) Stockholder Matters. Any stockholder action, approval or consent required, desired or otherwise sought by the Company pursuant to the NRS, the Articles of Incorporation, this Certificate of Designations or otherwise with respect to the issuance of Preferred Shares may be effected by written consent of the Company’s stockholders or at a duly called meeting of the Company’s stockholders, all in accordance with the applicable rules and regulations of the NRS. This provision is intended to comply with the applicable sections of the NRS permitting stockholder action, approval and consent affected by written consent in lieu of a meeting.
(b) Amendment. Except for Section 4(d) and this Section 30(b), which may not be amended, modified or waived hereunder, and except for an increase or decrease in the authorized number of shares of Series A Convertible Preferred Stock as contemplated hereby or in accordance with the Securities Purchase Agreement, which may be approved by the Board, this Certificate of Designations or any provision hereof may be amended by obtaining the affirmative vote at a meeting duly called for such purpose, or written consent without a meeting in accordance with the NRS, of the Required Holders, voting separate as a single class, and with such other stockholder approval, if any, as may then be required pursuant to the NRS and the Articles of Incorporation; provided, however, and notwithstanding anything this Certificate of Designations or the Transaction Documents to the contrary, no provision of the Preferred Shares or this Certificate of Designations shall be amended, modified or waived, and no consent, approval, objection, determination or selection shall be made by the Required Holders thereunder or hereunder, in each case, to the extent any such amendment, modification, waiver, consent, approval, objection, determination or selection would adversely affect any rights of any Holder of the Preferred Shares (for the avoidance of doubt, excluding the payment by the Company or any of its Subsidiaries of any legal fees and/or expenses of any Holder in connection therewith), unless any such Holder shall have previously consented in writing to such amendment, modification, waiver, consent, approval, objection, determination or selection. Except (a) to the extent otherwise expressly provided in this Certificate of Designations or the Articles of Incorporation with respect to voting or approval rights of a particular class or series of capital stock or (b) to the extent otherwise provided pursuant to the NRS, the holders of each outstanding class or series of shares of the Company shall not be entitled to vote as a separate voting group on any amendment to the terms of this Certificate of Designations with respect to which such class or series would otherwise be entitled under the NRS to vote as a separate voting group.
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31. Certain Defined Terms. For purposes of this Certificate of Designations, the following terms shall have the following meanings:
(a) “1933 Act” means the Securities Act of 1933, as amended, and the rules and regulations thereunder.
(b) “1934 Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.
(c) “Additional Amount” means, as of the applicable date of determination, with respect to each Preferred Share, all declared and unpaid Dividends on such Preferred Share.
(d) “Adjusted Floor Price” means, as determined on an Adjustment Date, twenty percent (20%) of the lower of (x) the closing price of the Common Stock on the Principal Market (as reported by the Principal Market) as of the Trading Day ended immediately prior to such applicable Adjustment Date and (y) the quotient of (I) the sum of the closing price of the Common Stock on the Principal Market (as reported by the Principal Market) on each Trading Day of the five (5) Trading Day period ended on, and including, the Trading Day ended immediately prior to such applicable Adjustment Date, divided by (II) five (5). All such determinations shall be appropriately adjusted for any stock split, stock dividend, stock combination or other similar transaction during any such measuring period.
(e) “Adjustment Right” means any right granted with respect to any securities issued in connection with, or with respect to, any issuance or sale of shares of Common Stock (other than rights of the type described in Section 7(a) hereof) that could result in a decrease in the net consideration received by the Company in connection with, or with respect to, such securities (including, without limitation, any cash settlement rights, cash adjustment or other similar rights).
(f) “Affiliate” or “Affiliated” means, with respect to any Person, any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 405 under the 1933 Act.
(g) “Alternate Conversion Floor Amount” means an amount equal to the product obtained by multiplying (A) the VWAP on the day the Holder delivers the applicable Conversion Notice and (B) the difference obtained by subtracting (I) the number of shares of Common Stock delivered (or to be delivered) to the Holder on the applicable Share Delivery Deadline with respect to such Alternate Conversion from (II) the quotient obtain by dividing (x) the applicable Conversion Amount that the Holder has elected to be the subject of the applicable Alternate Conversion, by (y) the applicable Alternate Conversion Price without giving effect to clause (ii)(x) of such definition.
(h) “Alternate Conversion Price” means, with respect to any Alternate Conversion that price which shall be the lower of (i) the applicable Conversion Price as in effect on the applicable Conversion Date of the applicable Alternate Conversion, and (ii) the greater of (x) the Floor Price or the Adjusted Floor Price, as applicable, and (y) 90% of the lowest VWAP of the Common Stock during the ten (10) consecutive Trading Day period ending and including the Trading Day immediately preceding the delivery or deemed delivery of the applicable Conversion Notice (such period, the “Alternate Conversion Measuring Period”). All such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification or similar transaction that proportionately decreases or increases the Common Stock during such Alternate Conversion Measuring Period.
(i) “Approved Stock Plan” means any employee benefit plan or agreement which has been approved by the Board prior to or subsequent to the Closing Date pursuant to which shares of Common Stock and standard options to purchase Common Stock may be issued to any employee, officer, consultant or director for services provided to the Company in their capacity as such.
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(j) “Attribution Parties” means, collectively, the following Persons and entities: (i) any investment vehicle, including, any funds, feeder funds or managed accounts, currently, or from time to time after the Initial Issuance Date, directly or indirectly managed or advised by a Holder’s investment manager or any of its Affiliates or principals, (ii) any direct or indirect Affiliates of such Holder or any of the foregoing, (iii) any Person acting or who could be deemed to be acting as a Group together with such Holder or any of the foregoing and (iv) any other Persons whose beneficial ownership of the Company’s Common Stock would or could be aggregated with such Holder’s and the other Attribution Parties for purposes of Section 13(d) of the 1934 Act. For clarity, the purpose of the foregoing is to subject collectively such Holder and all other Attribution Parties to the Maximum Percentage.
(k) Reserved.
(l) “Bloomberg” means Bloomberg, L.P.
(m) “Book-Entry” means each entry on the Register evidencing one or more Preferred Shares held by a Holder in lieu of a Preferred Share Certificate issuable hereunder.
(n) “Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any Governmental Authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York generally are open for use by customers on such day.
(o) “Closing Bid Price” and “Closing Sale Price” means, for any security as of any date, the last closing bid price and last closing trade price, respectively, for such security on the Principal Market, as reported by Bloomberg, or, if the Principal Market begins to operate on an extended hours basis and does not designate the closing bid price or the closing trade price (as the case may be) then the last bid price or last trade price, respectively, of such security prior to 4:00:00 p.m., New York time, as reported by Bloomberg, or, if the Principal Market is not the principal securities exchange or trading market for such security, the last closing bid price or last trade price, respectively, of such security on the principal securities exchange or trading market where such security is listed or traded as reported by Bloomberg, or if the foregoing do not apply, the last closing bid price or last trade price, respectively, of such security in the over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg, or, if no closing bid price or last trade price, respectively, is reported for such security by Bloomberg, the average of the bid prices, or the ask prices, respectively, of any market makers for such security as reported in The Pink Open Market (or a similar organization or agency succeeding to its functions of reporting prices). If the Closing Bid Price or the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing bases, the Closing Bid Price or the Closing Sale Price (as the case may be) of such security on such date shall be the fair market value as mutually determined by the Company and the Required Holders. If the Company and the Required Holders are unable to agree upon the fair market value of such security, then such dispute shall be resolved in accordance with the procedures in Section 23. All such determinations shall be appropriately adjusted for any stock splits, stock dividends, stock combinations, recapitalizations or other similar transactions during such period.
(p) “Common Stock” means (i) the Company’s Class A common stock, par value $0.00001 per share, and (ii) any capital stock into which such Class A common stock shall have been changed or any share capital resulting from a reclassification of such common shares.
(q) “Contingent Obligation” means, as to any Person, any direct or indirect liability, contingent or otherwise, of that Person with respect to any Indebtedness, lease, dividend or other obligation of another Person if the primary purpose or intent of the Person incurring such liability, or the primary effect thereof, is to provide assurance to the obligee of such liability that such liability will be paid or discharged, or that any agreements relating thereto will be complied with, or that the holders of such liability will be protected (in whole or in part) against loss with respect thereto.
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(r) “Conversion Floor Price Condition” means that the relevant Alternate Conversion Price is being determined based on clause (ii)(x) of such definition.
(s) “Convertible Securities” means any stock or other security (other than Options) that is at any time and under any circumstances, directly or indirectly, convertible into, exercisable or exchangeable for, or which otherwise entitles the holder thereof to acquire, any shares of Common Stock.
(t) Reserved.
(u) Reserved.
(v) “Eligible Market” means The New York Stock Exchange, the NYSE American, the Nasdaq Global Select Market, the Nasdaq Global Market, or the Nasdaq Capital Market.
(w) Reserved.
(x) “Effective Registration Date” means the date on which all shares of Common Stock underlying the Preferred Shares are freely tradable pursuant to an effective registration statement or Rule 144 under the 1933 Act without volume or manner-of-sale limitations.
(y) “Event Market Price” means, with respect to any Stock Combination Event Date, the quotient determined by dividing (x) the sum of the VWAP of the Common Stock for each of the five (5) Trading Days with the lowest VWAP of the Common Stock during the nine (9) consecutive Trading Day period ending and including the Trading Day immediately preceding the tenth (10th) Trading Day after such Stock Combination Event Date, divided by (y) five (5).
(z) “Securities Purchase Agreement” means that certain Securities Purchase Agreement by and among the Company, Piermont Valley Acquisition Corp., Tigerless Health, Inc. and the initial Holders of Preferred Shares, as amended from time to time in accordance with its terms.
(aa) “Closing Date” means the First Closing Date, as defined in the Securities Purchase Agreement.
(bb) [reserved]
(cc) “Floor Price” means initially $2.00 (as adjusted for stock splits, stock dividends, stock combinations, recapitalizations and similar events); provided that on the Effective Registration Date and every six (6) months thereafter (each, an “Adjustment Date”), the Floor Price shall automatically reset lower, and only lower, to the Adjusted Floor Price determined as of such Adjustment Date, subject in all cases to the rules and regulations of the Principal Market.
(dd) “Fundamental Transaction” means (A) that the Company shall, directly or indirectly, including through subsidiaries, Affiliates or otherwise, in one or more related transactions, (i) consolidate or merge with or into (whether or not the Company is the surviving corporation) another Subject Entity, or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially all of the properties or assets of the Company or any of its “significant subsidiaries” (as defined in Rule 1-02 of Regulation S-X) to one or more Subject Entities, or (iii) make, or allow one or more Subject Entities to make, or allow the Company to be subject to or have its Common Stock be subject to or party to one or more Subject Entities making, a purchase, tender or exchange offer that is accepted by the holders of at least either (x) 50% of the outstanding Common Stock, (y) 50% of the outstanding Common Stock calculated as if any Common Stock held by all Subject Entities making or party to, or Affiliated with any Subject Entities making or party to, such purchase, tender or exchange offer were not outstanding; or (z) such number of shares of Common Stock such that all Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such purchase, tender or exchange offer, become collectively the beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of at least 50% of the outstanding Common Stock, or (iv) consummate a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with one or more Subject Entities whereby all such Subject Entities, individually or in the aggregate, acquire, either (x) at least 50% of the outstanding Common Stock, (y) at least 50% of the outstanding Common Stock calculated as if any Common Stock held by all the Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such stock purchase agreement or other business combination were not outstanding; or (z) such number of shares of Common Stock such that the Subject Entities become collectively the beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of at least 50% of the outstanding Common Stock, or (v) reorganize, recapitalize or reclassify its Common Stock, (B) that the Company shall, directly or indirectly, including through subsidiaries, Affiliates or otherwise, in one or more related transactions, allow any Subject Entity individually or the Subject Entities in the aggregate to be or become the “beneficial owner” (as defined in Rule 13d-3 under the 1934 Act), directly or indirectly, whether through acquisition, purchase, assignment, conveyance, tender, tender offer, exchange, reduction in outstanding Common Stock, merger, consolidation, business combination, reorganization, recapitalization, spin-off, scheme of arrangement, reorganization, recapitalization or reclassification or otherwise in any manner whatsoever, of either (x) at least 50% of the aggregate ordinary voting power represented by issued and outstanding Common Stock, (y) at least 50% of the aggregate ordinary voting power represented by issued and outstanding Common Stock not held by all such Subject Entities as of the Initial Issuance Date calculated as if any Common Stock held by all such Subject Entities were not outstanding, or (z) a percentage of the aggregate ordinary voting power represented by issued and outstanding Common Stock or other equity securities of the Company sufficient to allow such Subject Entities to effect a statutory short form merger or other transaction requiring other stockholders of the Company to surrender their Common Stock without approval of the stockholders of the Company or (C) directly or indirectly, including through subsidiaries, Affiliates or otherwise, in one or more related transactions, the issuance of or the entering into any other instrument or transaction structured in a manner to circumvent, or that circumvents, the intent of this definition in which case this definition shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this definition to the extent necessary to correct this definition or any portion of this definition which may be defective or inconsistent with the intended treatment of such instrument or transaction.
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(ee) “GAAP” means United States generally accepted accounting principles, consistently applied.
(ff) “Governmental Authority” means any federal, foreign, state, county, municipal, provincial, or local governmental authority, court, judicial body, arbitration tribunal, government or self-regulatory organization, commission, tribunal or organization, or any regulatory, administrative, or other agency, or any political or other subdivision, department, commission, board, bureau, branch, division, ministry, or instrumentality of any of the foregoing.
(gg) “Group” means a “group” as that term is used in Section 13(d) of the 1934 Act and as defined in Rule 13d-5 thereunder.
(hh) “Indebtedness” means of any Person means, without duplication (A) all indebtedness for borrowed money, (B) all obligations issued, undertaken or assumed as the deferred purchase price of property or services, including, without limitation, “capital leases” in accordance with GAAP, consistently applied for the periods covered thereby (other than trade payables entered into in the ordinary course of business consistent with past practice), (C) all reimbursement or payment obligations with respect to letters of credit, surety bonds and other similar instruments, (D) all obligations evidenced by notes, bonds, debentures or similar instruments, including obligations so evidenced incurred in connection with the acquisition of property, assets or businesses, (E) all indebtedness created or arising under any conditional sale or other title retention agreement, or incurred as financing, in either case with respect to any property or assets acquired with the proceeds of such indebtedness (even though the rights and remedies of the seller or bank under such agreement in the event of default are limited to repossession or sale of such property), (F) all monetary obligations under any leasing or similar arrangement which, in connection with GAAP, consistently applied for the periods covered thereby, is classified as a capital lease, (G) all indebtedness referred to in clauses (A) through (F) above secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any mortgage, deed of trust, lien, pledge, charge, security interest or other encumbrance of any nature whatsoever in or upon any property or assets (including accounts and contract rights) with respect to any asset or property owned by any Person, even though the Person which owns such assets or property has not assumed or become liable for the payment of such indebtedness, and (H) all Contingent Obligations in respect of indebtedness or obligations of others of the kinds referred to in clauses (A) through (G) above.
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(ii) “Intellectual Property Rights” means, with respect to the Company and its Subsidiaries, all of their rights or licenses to use all trademarks, trade names, service marks, service mark registrations, service names, original works of authorship, patents, patent rights, copyrights, inventions, licenses, approvals, governmental authorizations, trade secrets and other intellectual property rights and all applications and registrations therefor.
(jj) “Investment” means any beneficial ownership (including stock, partnership or limited liability company interests) of or in any Person, or any loan, advance or capital contribution to any Person or the acquisition of all, or substantially all, of the assets of another Person or the purchase of any assets of another Person for greater than the fair market value of such assets.
(kk) “Liquidation Event” means, whether in a single transaction or series of transactions, the voluntary or involuntary liquidation, dissolution or winding up of the Company or such Subsidiaries the assets of which constitute all or substantially all of the assets of the business of the Company and its Subsidiaries, taken as a whole.
(ll) Reserved.
(mm) “Market Price” means 93% of the lowest daily VWAP during the five (5) Trading Day period immediately prior to the applicable Conversion Date or other date of determination.
(nn) “Material Adverse Effect” means any material adverse effect on the business, properties, assets, liabilities, operations, results of operations, condition (financial or otherwise) or prospects of the Company and its Subsidiaries, taken as a whole, or on the transactions contemplated hereby or on the other Transaction Documents, or by the agreements and instruments to be entered into in connection therewith, or on the authority or ability of the Company to perform its obligations under the Transaction Documents.
(oo) “Options” means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible Securities.
(pp) “Parent Entity” of a Person means an entity that, directly or indirectly, controls the applicable Person and whose common stock or equivalent equity security is quoted or listed on an Eligible Market, or, if there is more than one such Person or Parent Entity, the Person or Parent Entity with the largest public market capitalization as of the date of consummation of the Fundamental Transaction.
(qq) “Permitted Equity Issuances” means bona fide sales by the Company of Common Stock pursuant to an at-the-market offering program or equity line of credit approved by the Board and permitted under the Transaction Documents.
(rr) [reserved]
(ss) “Permitted Liens” means (i) any Lien for taxes not yet due or delinquent or being contested in good faith by appropriate proceedings for which adequate reserves have been established in accordance with GAAP, (ii) any statutory Lien arising in the ordinary course of business by operation of law with respect to a liability that is not yet due or delinquent, (iii) any Lien created by operation of law, such as materialmen’s liens, mechanics’ liens and other similar liens, arising in the ordinary course of business with respect to a liability that is not yet due or delinquent or that are being contested in good faith by appropriate proceedings, (iv) Liens (A) upon or in any equipment acquired or held by the Company or any of its Subsidiaries to secure the purchase price of such equipment or Indebtedness incurred solely for the purpose of financing the acquisition or lease of such equipment, or (B) existing on such equipment at the time of its acquisition, provided that the Lien is confined solely to the property so acquired and improvements thereon, and the proceeds of such equipment, in either case, with respect to Indebtedness in an aggregate amount not to exceed $250,000, (v) Liens incurred in connection with the extension, renewal or refinancing of the Indebtedness secured by Liens of the type described in clause (iv) above, provided that any extension, renewal or replacement Lien shall be limited to the property encumbered by the existing Lien and the principal amount of the Indebtedness being extended, renewed or refinanced does not increase, (vi) Liens in favor of customs and revenue authorities arising as a matter of law to secure payments of custom duties in connection with the importation of goods, and (vii) Liens arising from judgments, decrees or attachments in circumstances not constituting a Triggering Event, (viii) Liens with respect to the Preferred Shares.
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(tt) “Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization, any other entity or a government or any department or agency thereof.
(uu) Reserved.
(vv) “Principal Market” means, as of any time of determination, the principal trading market, if any, in which the shares of Common Stock then trade.
(ww) Reserved.
(xx) “SEC” means the United States Securities and Exchange Commission or the successor thereto.
(yy) “Securities” has the meaning set forth in the Securities Purchase Agreement.
(zz) “Stated Value” shall mean $1,000 per share, subject to adjustment for stock splits, stock dividends, recapitalizations, reorganizations, reclassifications, combinations, subdivisions or other similar events occurring after the Initial Issuance Date with respect to the Preferred Shares.
(aaa) “Stock Combination Event” means the occurrence at any time and from time to time on or after the Closing Date of any stock split, stock dividend, stock combination recapitalization or other similar transaction involving the Common Stock.
(bbb) “Subject Entity” means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.
(ccc) “Subsidiary” shall have the meaning set forth in the Securities Purchase Agreement.
(ddd) “Successor Entity” means the Person (or, if so elected by the Required Holders, the Parent Entity) formed by, resulting from or surviving any Fundamental Transaction or the Person (or, if so elected by the Required Holders, the Parent Entity) with which such Fundamental Transaction shall have been entered into.
(eee) “Trading Day” means, as applicable, (x) with respect to all price or trading volume determinations relating to the Common Stock, any day on which the Common Stock is traded on the Principal Market, or, if the Principal Market is not the principal trading market for the Common Stock, then on the principal securities exchange or securities market on which the Common Stock is then traded, provided that “Trading Day” shall not include any day on which the Common Stock is scheduled to trade on such exchange or market for less than 4.5 hours or any day that the Common Stock is suspended from trading during the final hour of trading on such exchange or market (or if such exchange or market does not designate in advance the closing time of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York time) unless such day is otherwise designated as a Trading Day in writing by the Holder or (y) with respect to all determinations other than price determinations relating to the Common Stock, any day on which The Nasdaq (or any successor thereto) is open for trading of securities.
(fff) “Transaction Documents” means the Securities Purchase Agreement, this Certificate of Designations and each other agreement or instrument entered into or delivered by the Company or any Holder in connection with the transactions contemplated by the Securities Purchase Agreement, in each case as amended from time to time in accordance with its terms.
(ggg) Reserved.
(hhh) “VWAP” means, for any security as of any date, the dollar volume-weighted average price for such security on the Principal Market (or, if the Principal Market is not the principal trading market for such security, then on the principal securities exchange or securities market on which such security is then traded), during the period beginning at 9:30 a.m., New York time, and ending at 4:00 p.m., New York time, as reported by Bloomberg through its “VAP” function (set to 09:30 start time and 16:00 end time) or, if the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter market on the electronic bulletin board for such security during the period beginning at 9:30 a.m., New York time, and ending at 4:00 p.m., New York time, as reported by Bloomberg, or, if no dollar volume-weighted average price is reported for such security by Bloomberg for such hours, the average of the highest closing bid price and the lowest closing ask price of any of the market makers for such security as reported in The Pink Open Market (or a similar organization or agency succeeding to its functions of reporting prices). If the VWAP cannot be calculated for such security on such date on any of the foregoing bases, the VWAP of such security on such date shall be the fair market value as mutually determined by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value of such security, then such dispute shall be resolved in accordance with the procedures in Section 23. All such determinations shall be appropriately adjusted for any stock dividend, stock split, stock combination, recapitalization or other similar transaction during such period.
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32. Disclosure. Upon receipt or delivery by the Company of any notice in accordance with the terms of this Certificate of Designations, unless the Company has in good faith determined that the matters relating to such notice do not constitute material, non-public information relating to the Company or any of its Subsidiaries, the Company shall on or prior to 9:00 am, New York city time on the Business Day immediately following such notice delivery date, publicly disclose such material, non-public information on a Current Report on Form 8-K or otherwise. In the event that the Company believes that a notice contains material, non-public information relating to the Company or any of its Subsidiaries, the Company so shall indicate to the applicable Holder explicitly in writing in such notice (or promptly (but no later than the next Business Day) following receipt of notice from such Holder, as applicable), and in the absence of any such written indication in such notice (or notification from the Company promptly (but no later than the next Business Day) following receipt of notice from such Holder), such Holder shall be entitled to presume that information contained in the notice does not constitute material, non-public information relating to the Company or any of its Subsidiaries. Nothing contained in this Section 32 shall limit any obligations of the Company, or any rights of any Holder, under Section 5.6 of the Securities Purchase Agreement.
33. Absence of Trading and Disclosure Restrictions. The Company acknowledges and agrees that no Holder is a fiduciary or agent of the Company and that, in the absence of a written non-disclosure agreement signed by an officer of such Holder, no Holder has a contractual obligation under this Certificate of Designations to maintain the confidentiality of information provided by the Company or to refrain from trading the Company’s securities. Notwithstanding the foregoing, each Holder remains subject at all times to applicable federal and state securities laws, and nothing in this Certificate of Designations authorizes any Holder to trade while aware of material nonpublic information or to disclose information in violation of Applicable Law. When a Holder is not aware of material nonpublic information, this Certificate of Designations does not restrict such Holder from trading the Company’s securities.
RESOLVED, FURTHER, that the chairman of the board, the chief executive officer, the president or any vice-president, and the secretary or any assistant secretary, of the Corporation be and they hereby are authorized and directed to prepare and file this Certificate of Designation of Preferences, Rights and Limitations in accordance with the foregoing resolution and the provisions of Nevada law.
IN WITNESS WHEREOF, the undersigned has executed this Certificate this ___ day of __________, 2026.
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EXHIBIT I
TIGERLESS AI HOLDINGS INC.
CONVERSION NOTICE
Reference is made to the Certificate of Designations of the Articles of Incorporation of Tigerless AI Holdings Inc., a Nevada corporation (the “Company”), establishing the terms, preferences and rights of the Series A Convertible Preferred Stock, $0.00001 par value (the “Preferred Shares”), of the Company (the “Certificate of Designations”). In accordance with and pursuant to the Certificate of Designations, the undersigned hereby elects to convert the number of Preferred Shares indicated below into shares of Class A common stock, $0.00001 par value per share (the “Common Stock”), of the Company, as of the date specified below.
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Please issue the Common Stock into which the applicable Preferred Shares are being converted to Holder, or for its benefit, as follows:
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EXHIBIT II
ACKNOWLEDGMENT
The Company hereby acknowledges this Conversion Notice, (a) certifies that the above indicated number of shares of Common Stock [are][are not] eligible to be resold by the applicable Holder either (i) pursuant to Rule 144 of the 1933 Act (subject to such Holder’s execution and delivery to the Company of a customary Rule 144 representation letter) or (ii) pursuant to an effective and available registration statement and (b) hereby directs ____________________ to issue the above indicated number of shares of Common Stock in accordance with the Transfer Agent Instructions dated __________, 2026 from the Company and acknowledged and agreed to by ____________________.
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EXHIBIT 10.1
SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT (this “Agreement”) is dated as of September 30, 2026 (the “Execution Date”), by and among (i) Tigerless AI Holdings Inc., a Nevada corporation (“Pubco” and, from and after the Merger Closing, the “Company”), (ii) Piermont Valley Acquisition Corp., a Cayman Islands exempted company (“Piermont”), (iii) Tigerless Health, Inc., a New York corporation (“Tigerless” and, together with Piermont and Pubco, the “Seller Parties”), and (iv) the purchaser identified on the signature page hereto (including its successors and permitted assigns, the “Purchaser”). The Seller Parties and the Purchaser are sometimes referred to herein individually as a “Party” and collectively as the “Parties.”
RECITALS
WHEREAS, Piermont, Tigerless, Pubco and certain merger subsidiaries have entered into that certain Agreement and Plan of Merger, dated as of April 17, 2026 (as amended, restated, supplemented or otherwise modified from time to time, the “Merger Agreement”), pursuant to which, among other things, Piermont and Tigerless will become wholly owned subsidiaries of Pubco and Pubco will become the publicly traded parent company of the combined enterprise (the “Mergers”);
WHEREAS, in connection with the Mergers, Pubco desires to issue and sell to the Purchaser, and the Purchaser desires to purchase from Pubco, an aggregate of 5,000 shares (the “Preferred Shares”) of Pubco’s Series A Convertible Preferred Stock, par value $0.00001 per share (the “Series A Preferred Stock”), having an aggregate stated value of $5,000,000, upon the terms and subject to the conditions set forth herein;
WHEREAS, the rights, preferences, powers, restrictions and limitations of the Series A Preferred Stock will be set forth in the Certificate of Designations of Series A Convertible Preferred Stock substantially in the form previously agreed by the Parties and attached as Exhibit A (the “Certificate of Designations”);
WHEREAS, the Preferred Shares will be convertible into shares of Pubco’s Class A common stock, par value $0.00001 per share (the “Common Stock”), and Pubco has agreed to register for resale the shares of Common Stock issuable upon conversion of the Preferred Shares and otherwise issuable pursuant to the Transaction Documents (collectively, the “Registrable Securities”); and
WHEREAS, the Parties intend that the purchase and sale of the Preferred Shares will be effected in two fundings following consummation of the Mergers, as more particularly provided herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
ARTICLE I
DEFINITIONS; CONSTRUCTION
Section 1.1 Defined Terms. As used in this Agreement, the following terms have the meanings set forth below. Capitalized terms used but not otherwise defined herein have the meanings assigned to them in the Certificate of Designations.
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“Affiliate” has the meaning set forth in Rule 405 under the Securities Act.
“Agreement” has the meaning set forth in the preamble.
“Applicable Law” means any federal, state, local or foreign law, statute, ordinance, rule, regulation, order, judgment, decree or governmental requirement applicable to the relevant Person, property or activity.
“Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks in New York, New York are authorized or required by law to close.
“Certificate of Designations” has the meaning set forth in the recitals.
“Closing Fee Shares” means 2,000,000 shares of Common Stock that will be acquired by the Purchaser from the Transferring Holders.
“Commission” or “SEC” means the United States Securities and Exchange Commission.
“Common Stock” has the meaning set forth in the recitals.
“Effective Registration Date” means the first date on which all Registrable Securities then outstanding or issuable upon conversion of the Preferred Shares may be resold by the Purchaser pursuant to an effective Registration Statement or Rule 144 without volume or manner-of-sale limitations.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Excusable Delay” means, with respect to any obligation of Pubco to deliver Closing Fee Shares, to cause a Registration Statement to be filed or declared effective or to perform any other obligation under the Transaction Documents, any failure or delay in performance to the extent resulting from causes outside Pubco’s reasonable control (including any act, omission, delay or system malfunction of the Transfer Agent, DTC, the Purchaser or the Purchaser’s broker or custodian, the Principal Market, the Commission or any other governmental authority, or any general suspension of trading or settlement), provided that (a) Pubco has timely completed all actions, and delivered all instructions, notices, stock powers, certificates, opinions, documents and payments, required to be completed or delivered by it or its counsel in order for such obligation to be performed, (b) Pubco has notified the Purchaser in writing of such cause promptly (and in any event within one (1) Trading Day) after becoming aware of it, and (c) Pubco uses its reasonable best efforts to cause such obligation to be performed as promptly as practicable. An Excusable Delay shall not include any failure or delay to the extent attributable to any act or omission of Pubco, any other Seller Party or any of their respective Affiliates.
“Fee Share Cure Period” means, with respect to any installment of Closing Fee Shares (including the Initial Fee Shares) not delivered on the date due under Section 2.4, the period of five (5) Trading Days immediately following such due date (or, if the failure to deliver results from an Excusable Delay, the period of five (5) Trading Days immediately following the cessation of such Excusable Delay).
“First Closing” means the consummation of the purchase and sale of the First Tranche Preferred Shares under Section 2.2.
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“First Closing Date” means the first Business Day following the Merger Closing, or such other date as the Parties may agree in writing.
“First Tranche Preferred Shares” means 3,500 Preferred Shares having an aggregate Stated Value and Purchase Price of $3,500,000.
“Leak-Out Restrictions” means the restrictions set forth in Section 5.13.
“Losses” means claims, losses, liabilities, damages, judgments, penalties, fines, amounts paid in settlement, costs and reasonable documented out-of-pocket expenses, including reasonable attorneys’ fees and disbursements.
“Material Adverse Effect” means any event, change, circumstance or effect that, individually or in the aggregate, has had or would reasonably be expected to have a material adverse effect on (a) the business, assets, liabilities, financial condition or results of operations of Pubco, Tigerless and their Subsidiaries, taken as a whole, or (b) the authority or ability of any Seller Party to perform its material obligations under the Transaction Documents; provided that the customary public-company and industry-wide exclusions set forth in the Merger Agreement shall apply, mutatis mutandis, except to the extent disproportionately affecting Pubco, Tigerless and their Subsidiaries.
“Merger Closing” means the consummation of the transactions contemplated by the Merger Agreement.
“Principal Market” means Nasdaq or, if the Common Stock is not then listed on Nasdaq, the principal U.S. securities exchange or market on which the Common Stock is traded.
“Purchase Price” means $1,000 per Preferred Share and $5,000,000 in the aggregate, with no original issue discount.
“Registration Statement” means one or more registration statements filed with the Commission covering the resale of the Registrable Securities.
“Rule 144” means Rule 144 promulgated under the Securities Act, as amended or interpreted from time to time.
“Second Closing” means the consummation of the purchase and sale of the Second Tranche Preferred Shares under Section 2.3.
“Second Closing Date” means the ninetieth (90th) Business Day following the Merger Closing, or such earlier date as the Parties may agree in writing, in each case as such date may be extended pursuant to Section 2.3.
“Second Tranche Preferred Shares” means 1,500 Preferred Shares having an aggregate Stated Value and Purchase Price of $1,500,000.
“Securities” means the Preferred Shares, the Conversion Shares, the Closing Fee Shares and any other securities issued or issuable to the Purchaser under the Transaction Documents.
“Securities Act” means the Securities Act of 1933, as amended.
“Stated Value” means $1,000 per Preferred Share.
“Subsidiary” means, with respect to a Person, any entity of which such Person directly or indirectly owns or controls a majority of the voting power or equity interests.
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“Trading Day” means any day on which the Principal Market is open for trading.
“Transaction Documents” means this Agreement, the Certificate of Designations, the Irrevocable Transfer Agent Instructions, each closing certificate and all other agreements, instruments and documents executed or delivered in connection herewith.
“Transfer Agent” means Continental Stock Transfer & Trust Company, the transfer agent for the Common Stock.
“Transferring Holders” mean the stockholders of Tigerless and/or Piermont that transfer the Closing Fee Shares to the Purchaser.
“VWAP” has the meaning set forth in the Certificate of Designations.
Section 1.2 Construction. Unless the context otherwise requires: (a) words in the singular include the plural and vice versa; (b) “including” means “including without limitation”; (c) references to Articles, Sections, Exhibits and Schedules are to this Agreement; (d) references to a law include amendments and successor provisions; (e) “or” is not exclusive; (f) the words “hereof,” “herein” and “hereunder” refer to this Agreement as a whole; and (g) no presumption or burden of proof will arise favoring or disfavoring any Party by virtue of authorship.
ARTICLE II
PURCHASE AND SALE; CLOSINGS
Section 2.1 Commitment to Purchase and Sell. Upon the terms and subject to the conditions of this Agreement, Pubco agrees to issue and sell to the Purchaser, and the Purchaser irrevocably commits to purchase from Pubco, 5,000 Preferred Shares for the Purchase Price. The Preferred Shares shall be issued at par for the Purchase Price without original issue discount. As set forth more fully in the Certificate of Designations, each Preferred Share is convertible at the Purchaser’s election into Common Stock based on a Conversion Amount equal to 110% of its Stated Value plus other amounts then due, at a Conversion Price equal to the lower of (a) $10.00 and (b) 93% of the lowest daily VWAP during the five Trading Days immediately preceding conversion, subject to an initial Floor Price of $2.00 that automatically resets to 20% of the applicable market price on the Effective Registration Date and every six months thereafter, and subject to the beneficial-ownership limitations set forth in the Certificate of Designations, including Section 4(d) thereof.
Section 2.2 First Closing. At the First Closing, subject to the satisfaction (or written waiver by the Purchaser) of the conditions set forth in Section 6.1, (a) Pubco shall issue to the Purchaser the First Tranche Preferred Shares in book-entry form, registered in the name of the Purchaser, and (b) the Purchaser shall pay $3,500,000 by wire transfer of immediately available funds to the account designated by Pubco at least two Business Days before the First Closing Date.
Section 2.3 Second Closing. At the Second Closing, subject to all of the conditions set forth in Section 6.2 having been satisfied and remaining satisfied as of the Second Closing Date (or having been waived in writing by the Purchaser), (a) Pubco shall issue to the Purchaser the Second Tranche Preferred Shares in book-entry form, registered in the name of the Purchaser, and (b) the Purchaser shall pay $1,500,000 by wire transfer of immediately available funds to the account designated by Pubco at least two Business Days before the Second Closing Date. The Purchaser’s obligation to fund the Second Closing is a binding commitment and is not subject to market-price, trading-volume, financing, due-diligence-out or discretionary conditions. If, on the date that would otherwise be the Second Closing Date, any condition set forth in Section 6.2 is not satisfied solely because (i) a failure to deliver an installment of Closing Fee Shares is then within the applicable Fee Share Cure Period or is then the subject of a continuing Excusable Delay, or (ii) a breach or failure that would constitute a Pubco Default is then within an applicable cure period under Section 7.3, then the Second Closing Date shall be extended, without further action by any Party, to the second (2nd) Trading Day following the date on which such failure or breach is cured, and the Purchaser’s obligation to fund the Second Closing shall continue in full force and effect; provided that the Second Closing Date shall not be extended pursuant to this sentence to a date more than [thirty (30)] Trading Days after the date that would otherwise have been the Second Closing Date.
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Section 2.4 Closing Fee Shares. The Closing Fee Shares shall be delivered to Purchaser by the Transferring Holders as follows: (a) immediately prior to the Merger Closing, the Transferring Holders shall transfer to the Purchaser the greatest number of Closing Fee Shares (the “Initial Fee Shares”) that, immediately after giving effect to such delivery, would not result in the Purchaser, together with its Attribution Parties, beneficially owning (as determined in accordance with Section 13(d) of the Exchange Act and Section 4(d) of the Certificate of Designations) in excess of 4.99% of the shares of Common Stock outstanding immediately after the Merger Closing (the “Fee Share Cap”); and (b) thereafter, within one (1) Trading Day after each written notice from the Purchaser (which the Purchaser may deliver from time to time and which shall certify the Purchaser’s then-current beneficial ownership), the Transferring Holders shall deliver to the Purchaser the greatest number of remaining undelivered Closing Fee Shares that would not, after giving effect to such delivery, cause the Purchaser to exceed the Fee Share Cap, until all 2,000,000 Closing Fee Shares have been delivered (the Purchaser may rely on the Reported Outstanding Share Number, as defined in the Certificate of Designations, for this purpose). Pubco and the Transfer Agent shall be entitled to rely conclusively on the Purchaser’s certification of its beneficial ownership contained in each such notice, and no delivery of Closing Fee Shares made in good-faith reliance thereon shall constitute a breach of this Agreement or the Certificate of Designations by Pubco. Delivery of the Initial Fee Shares is an absolute condition to the Purchaser’s obligation to fund either Closing. The Closing Fee Shares are fully earned upon delivery and shall not be subject to clawback, setoff or refund except where the Purchaser fails to fund the Second Closing at a time when all conditions to the Second Closing have been satisfied or waived.
Section 2.5 Closing Deliveries by the Seller Parties. At or before the First Closing, and where applicable, at or before the Second Closing, the Seller Parties shall deliver: (a) this Agreement duly executed by each Seller Party; (b) evidence that the Certificate of Designations has been duly filed with and accepted by the Nevada Secretary of State and remains in effect; (c) evidence of delivery of the Initial Fee Shares (and, at the Second Closing, of all other Closing Fee Shares then required to have been delivered under Section 2.4) to the Purchaser by DWAC credit to the account designated by the Purchaser, without restrictive legend or stop-transfer instruction, together with written confirmation from the Transfer Agent to that effect; (d) an officer’s certificate certifying satisfaction of the conditions in Section 6.1; (e) a secretary’s certificate attaching organizational documents, authorizing resolutions, incumbency certificates and good-standing certificates; (f) Irrevocable Transfer Agent Instructions duly executed by Pubco and by the Transfer Agent; (g) a legal opinion of counsel to Pubco, in form and substance customary for transactions of this type and reasonably satisfactory to the Purchaser, subject to customary assumptions, qualifications and limitations and, as to matters of fact, based on certificates of officers of Pubco and of the transferring stockholders, covering organization, authorization, enforceability, valid issuance and, with respect to the Closing Fee Shares, that the issuance of such shares to the transferring stockholders was registered under the Securities Act on Pubco’s registration statement on Form S-4 and that, assuming the accuracy of the representations of the transferring stockholders and of the Purchaser referred to in Section 3.3, such shares are not “restricted securities” under Rule 144 and may be transferred to the Purchaser without restrictive legend; (h) a completed IRS Form W-9; and (i) wire instructions certified by an authorized officer. At the Second Closing, Pubco shall deliver bring-down certificates and evidence of issuance of the Second Tranche Preferred Shares.
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The Seller Parties shall also deliver at or before the First Closing evidence reasonably satisfactory to the Purchaser that the Merger Agreement has been amended or the applicable parties have granted a waiver sufficient to permit the funding schedule set forth in Sections 2.2 and 2.3 without a breach of Section 7.10 of the Merger Agreement.
Section 2.6 Closing Deliveries by the Purchaser. At or before the First Closing, the Purchaser shall deliver this Agreement duly executed, a completed accredited-investor questionnaire, its wire payment under Section 2.2 and a completed IRS Form W-9 or applicable IRS Form W-8. At the Second Closing, the Purchaser shall deliver its wire payment under Section 2.3.
Section 2.7 No Escrow; Legal Fees. Unless otherwise agreed in writing, funds shall be paid directly to Pubco. At the First Closing, Pubco shall reimburse the Purchaser for its reasonable, documented out-of-pocket legal and diligence fees and expenses incurred in connection with the transactions, not to exceed $25,000 in the aggregate. Such reimbursement is in addition to the Purchase Price and shall not reduce the number or Stated Value of Preferred Shares issued.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLER PARTIES
Each Seller Party represents and warrants the following to the Purchaser as of the Execution Date, the First Closing Date, and the Second Closing Date, solely with respect to itself and, where expressly applicable, its Subsidiaries. From and after the Merger Closing, Pubco confirms and assumes the obligations of the Seller Parties under this Article III.
Section 3.1 Organization and Qualification. Each Seller Party and each material Subsidiary is duly organized, validly existing and in good standing under the laws of its jurisdiction of organization and has all requisite power and authority to own its properties and conduct its business. Each is duly qualified in every jurisdiction where failure to qualify would reasonably be expected to have a Material Adverse Effect.
Section 3.2 Authorization; Enforcement. Each Seller Party has full power and authority to execute and deliver the Transaction Documents to which it is a party and to perform its obligations thereunder. All necessary corporate, shareholder and other action has been taken. Each Transaction Document constitutes a legal, valid and binding obligation of each Seller Party that is a party thereto, enforceable in accordance with its terms, subject to bankruptcy, insolvency and general equitable principles.
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Section 3.3 Valid Issuance of Securities. The Preferred Shares have been duly authorized by Pubco and, when issued and paid for in accordance herewith, will be validly issued, fully paid and nonassessable and free of preemptive or similar rights. The Conversion Shares and any Closing Fee Shares newly issued by Pubco have been duly authorized and, when issued in accordance with the Transaction Documents, will be validly issued, fully paid and nonassessable; any Closing Fee Shares transferred by legacy Tigerless stockholders will have been validly issued, fully paid and nonassessable and will have been issued to such stockholders pursuant to Pubco’s registration statement on Form S-4 declared effective by the Commission; based on the written representations of the transferring stockholders (copies of which shall be delivered to the Purchaser at or before the First Closing), no transferring stockholder is, or has been during the three months preceding such delivery, an Affiliate of Pubco, Piermont or Tigerless; and, assuming the accuracy of such representations and of the representations of the Purchaser in Article IV, such Closing Fee Shares will not constitute “restricted securities” (as defined in Rule 144) and, upon delivery to the Purchaser, may be resold by the Purchaser without restrictive legend and without volume or manner-of-sale limitations under Rule 144 (subject only to the Leak-Out Restrictions and to the Purchaser’s compliance with applicable securities laws). In each case, the applicable Securities will be delivered free and clear of all Liens created by any Seller Party or transferring stockholder. Pubco has reserved from its duly authorized capital stock the number of shares of Common Stock required by the Certificate of Designations.
Section 3.4 No Conflicts; Consents. The execution, delivery and performance of the Transaction Documents, issuance of the Securities and consummation of the transactions will not (a) violate any organizational document, (b) conflict with or result in a default, acceleration, termination right or lien, mortgage, or encumbrance (a “Lien”) under any material agreement, (c) violate Applicable Law or any order, or (d) require any consent or filing, except filings under federal and state securities laws, the filing of the Certificate of Designations, Principal Market notifications and consents already obtained.
Section 3.5 Capitalization. The capitalization of Pubco immediately following the Merger Closing will be as set forth in the definitive proxy statement/prospectus for the Merger, as updated by a written capitalization schedule delivered to the Purchaser before the First Closing. Except as disclosed in Exhibit 3.5, there are no outstanding options, warrants, convertible securities, preemptive rights, registration rights, voting agreements or obligations to issue or repurchase equity securities.
Section 3.6 SEC Reports; Financial Statements. Piermont has timely filed all reports required under the Exchange Act during the preceding two years, and, following the Merger Closing, Pubco will be current in its SEC reporting obligations. Such reports complied in all material respects with applicable requirements and did not contain an untrue statement of material fact or omit a material fact required to make the statements not misleading. The included financial statements fairly present, in all material respects, the financial position and results of the applicable issuer in conformity with GAAP, subject in interim periods to normal year-end adjustments.
Section 3.7 Absence of Certain Changes. Since the date of the latest audited financial statements of Piermont and Tigerless included or incorporated in the SEC reports or the proxy statement/prospectus relating to the Merger, except as disclosed in subsequent SEC reports or the Merger Agreement, there has not occurred a Material Adverse Effect, and neither Piermont nor Tigerless has taken any action outside the ordinary course that would materially impair the transactions contemplated hereby.
Section 3.8 No Undisclosed Liabilities. No Seller Party or Subsidiary has liabilities required by GAAP to be reflected on a balance sheet or disclosed in the notes thereto, except liabilities so reflected or disclosed, liabilities incurred in the ordinary course since the applicable balance-sheet date, transaction expenses and liabilities that would not reasonably be expected to have a Material Adverse Effect.
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Section 3.9 Litigation. There is no action, suit, inquiry, investigation or proceeding pending or, to the knowledge of the Seller Parties, threatened that challenges the Transaction Documents or would reasonably be expected to have a Material Adverse Effect. No Seller Party is subject to an outstanding order that materially restricts its business or the transactions.
Section 3.10 Compliance with Laws; Permits. Each Seller Party and Subsidiary is in material compliance with Applicable Law and possesses all material permits necessary to conduct its business. No Seller Party has received an uncured written notice alleging material noncompliance.
Section 3.11 Title to Assets. Tigerless and its Subsidiaries have good and marketable title to, or valid leasehold interests in, all material real and personal property used in their businesses, free of Liens other than customary permitted liens that do not materially impair use.
Section 3.12 Intellectual Property. Tigerless and its Subsidiaries own or possess sufficient rights to use all intellectual property material to their businesses. To Tigerless’s knowledge, the conduct of their businesses does not materially infringe the rights of others, and no material claim is pending or threatened. Tigerless and its Subsidiaries take commercially reasonable measures to protect material intellectual property and confidential information.
Section 3.13 Data Privacy and Cybersecurity. Tigerless and its Subsidiaries maintain commercially reasonable information-security, cybersecurity, privacy and data-protection policies and controls appropriate to their businesses and are in material compliance with applicable privacy and data-security laws. During the preceding three years, there has been no material data breach or cybersecurity incident that has not been remediated and appropriately disclosed.
Section 3.14 Taxes. All material tax returns required to be filed have been timely filed, all material taxes due have been paid or adequately reserved, and no material tax audit or deficiency is pending or, to the knowledge of the Seller Parties, threatened, except as disclosed in the SEC reports.
Section 3.15 Employees; Benefit Plans. Tigerless and its Subsidiaries are in material compliance with applicable employment and labor laws. Each material employee benefit plan has been maintained in material compliance with its terms and Applicable Law, and no event has occurred that would reasonably be expected to create material liability under ERISA.
Section 3.16 Environmental Matters. Tigerless and its Subsidiaries are in material compliance with applicable environmental laws and have no material environmental liability, except as disclosed in the SEC reports or the proxy statement/prospectus relating to the Merger.
Section 3.17 Insurance. Tigerless and its Subsidiaries maintain insurance coverage with financially sound insurers in amounts and against risks reasonably customary for similarly situated businesses, and no material policy is subject to pending cancellation other than in connection with ordinary-course renewals.
Section 3.18 Regulatory Matters. To the extent applicable to their businesses, Tigerless and its Subsidiaries are in material compliance with healthcare, insurance, consumer-protection, licensing and reimbursement laws and have not received any uncured written notice of a material violation.
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Section 3.19 Foreign Corrupt Practices; Sanctions; AML. No Seller Party, Subsidiary or, to their knowledge, director, officer, employee or agent acting on their behalf has violated the Foreign Corrupt Practices Act, anti-bribery laws, anti-money-laundering laws or economic sanctions administered by OFAC. No Seller Party or Subsidiary is a Person that is the subject or target of any sanctions administered or enforced by OFAC, the U.S. Department of State, the United Nations Security Council, the European Union or His Majesty’s Treasury (a “Sanctioned Person”), or that is located, organized or resident in a country or territory that is the subject of comprehensive sanctions.
Section 3.20 Transactions with Affiliates. Except as disclosed in Exhibit 3.20, no officer, director or 5% stockholder has a material direct or indirect interest in any transaction with a Seller Party required to be disclosed under Item 404 of Regulation S-K.
Section 3.21 Investment Company; Shell Company. Pubco is not, and immediately after receipt of applicable portion of the Purchase Price in each Closing will not be, an “investment company” required to register under the Investment Company Act of 1940. Immediately following the consummation of the Merger Closing, Pubco will not be a “shell company” (as defined in Rule 12b-2 under the Exchange Act).
Section 3.22 Listing and DTC Eligibility. At the First Closing, the Common Stock will be approved for listing on the Nasdaq, subject only to official notice of issuance, and will be eligible for clearance and settlement through DTC. No proceeding to suspend or terminate such listing or eligibility will be pending or threatened in writing.
Section 3.23 Private Placement. Assuming the accuracy of the Purchaser’s representations, the offer and sale by Pubco of the Preferred Shares are exempt from registration under Section 4(a)(2) of the Securities Act and Rule 506(b) of Regulation D. Neither Pubco nor any Person acting on its behalf has engaged in general solicitation or general advertising in connection with the offering.
Section 3.24 No Integrated Offering. No Seller Party or any Affiliate thereof has offered or sold securities in a manner that would cause this offering to be integrated with another offering so as to require registration of the Preferred Shares or stockholder approval under the rules of the Principal Market, except for any approval obtained before the First Closing. As of the Execution Date and the First Closing Date, no approval of the stockholders of Pubco or Piermont under the rules of the Principal Market (including Nasdaq Listing Rule 5635) is required for the issuance of the Securities in full (without regard to any beneficial-ownership limitation, but after giving effect to any limitation on the aggregate number of shares of Common Stock issuable under the Certificate of Designations that is intended to comply with such rules), or any such approval has been validly obtained and remains in effect. If, after the First Closing, the Principal Market determines, or Pubco reasonably concludes, that any such approval is required, Pubco’s obligations with respect thereto shall be governed exclusively by Section 5.19 and Section 6.2(j), and neither such determination nor Pubco’s compliance with Section 5.19 shall constitute a breach of this Section 3.24 or any other representation or warranty herein, or a Pubco Default.
Section 3.25 Brokers and Finders. No broker, finder, placement agent or investment banker is entitled to any fee or commission from the Purchaser in connection with the transactions by reason of an arrangement made by a Seller Party. Pubco is solely responsible for any fee payable to a broker engaged by a Seller Party.
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Section 3.26 No Material Nonpublic Information. Except for information concerning this transaction that will be publicly disclosed in accordance with Section 5.6, no Seller Party has provided the Purchaser with material nonpublic information.
Section 3.27 Full Disclosure. The written information furnished by or on behalf of the Seller Parties to the Purchaser in connection with the transactions, taken as a whole and together with the SEC reports, does not contain any untrue statement of material fact or omit a material fact necessary to make the statements therein, in light of the circumstances in which made, not misleading; provided that no representation is made concerning projections except that they were prepared in good faith based on assumptions believed reasonable when made.
Section 3.28 Business Combination Matters. As of the Execution Date, the Merger Agreement is in full force and effect and constitutes a valid and binding obligation of each Seller Party that is a party thereto; no Seller Party is in material breach thereof; and no Seller Party has waived any condition or amended the Merger Agreement in a manner that would reasonably be expected to be materially adverse to the Purchaser or the Securities. The registration statement and proxy statement/prospectus relating to the Merger, when filed, and each amendment or supplement thereto, will comply in all material respects with Applicable Law and will not contain an untrue statement of a material fact or omit a material fact necessary to make the statements therein, in light of the circumstances in which made, not misleading. On or before the Merger Closing, all stockholder and regulatory approvals required to consummate the Merger will have been obtained, all conditions to the Merger Closing will have been satisfied or validly waived, and the Seller Parties will have obtained an amendment or waiver of Section 7.10 of the Merger Agreement sufficient to permit the funding schedule set forth in Sections 2.2 and 2.3 of this Agreement.
Section 3.29 Internal Controls; Sarbanes-Oxley Act. Piermont has established and maintains the disclosure controls and procedures and internal control over financial reporting required by Applicable Law and is in compliance in all material respects with the applicable requirements of the Sarbanes-Oxley Act of 2002. Tigerless, Pubco and their Subsidiaries maintain systems of internal accounting controls reasonably designed to provide reasonable assurance that transactions are executed in accordance with management’s authorization, transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain accountability for assets, and access to assets is permitted only in accordance with management’s authorization. Except as disclosed in Exhibit 3.29, no Seller Party has been advised by its independent registered public accounting firm of any material weakness in internal control over financial reporting that remains unremediated.
Section 3.30 Material Contracts. Each contract required to be filed as an exhibit to Piermont’s SEC reports or disclosed as a material contract in the Merger Agreement or the proxy statement/prospectus relating to the Merger is in full force and effect and constitutes a valid and binding obligation of Piermont or Tigerless, as applicable, and, to the knowledge of the applicable Seller Party, each counterparty thereto, subject to bankruptcy, insolvency and general equitable principles. Neither Piermont nor Tigerless is in material default under any such contract, and, to the knowledge of the applicable Seller Party, no counterparty is in material default thereunder, except in each case as disclosed in Exhibit 3.30.
Section 3.31 No Disqualification Events. None of the Seller Parties, any predecessor or affiliated issuer, any director or executive officer, any other officer participating in the offering, any beneficial owner of twenty percent (20%) or more of Pubco’s outstanding voting equity securities, calculated on the basis of voting power, or any promoter connected with a Seller Party in any capacity at the time of sale is subject to any disqualification event described in Rule 506(d)(1)(i) through (viii) under the Securities Act, except for an event covered by Rule 506(d)(2) or (d)(3), as disclosed in Exhibit 3.31.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
Section 4.1 Organization; Authority. The Purchaser is duly organized, validly existing and in good standing under the laws of its jurisdiction of organization and has full power and authority to execute, deliver and perform this Agreement. This Agreement has been duly authorized and constitutes its legal, valid and binding obligation, subject to bankruptcy, insolvency and general equitable principles.
Section 4.2 Investment Intent. The Purchaser is acquiring the Preferred Shares for its own account, for investment and not with a present view to or for distributing them in violation of the Securities Act; provided that the Purchaser retains the right to dispose of the Securities in compliance with Applicable Law and the Leak-Out Restrictions.
Section 4.3 Accredited Investor; Sophistication. The Purchaser is an “accredited investor” within Rule 501(a) of Regulation D, has sufficient knowledge and experience to evaluate the merits and risks of the investment, can bear the economic risk of a complete loss, and has had an opportunity to ask questions and obtain information it reasonably requested.
Section 4.4 Reliance. The Purchaser has relied on its own review and on the express representations and warranties contained in the Transaction Documents and not on any other representation. Nothing herein waives any claim for fraud or intentional misrepresentation.
Section 4.5 No General Solicitation. The Purchaser was not offered the Preferred Shares through general solicitation or general advertising.
Section 4.6 Brokers. No broker or finder is entitled to compensation from any Seller Party based on an arrangement made by the Purchaser.
Section 4.7 Sanctions and Source of Funds. Neither the Purchaser nor, to its knowledge, any controlling Person is a Sanctioned Person. To the Purchaser’s knowledge, the funds used to pay the Purchase Price are not derived from unlawful activity, and the Purchaser is in compliance in all material respects with anti-money-laundering laws applicable to the Purchaser.
Section 4.8 Residence. The Purchaser’s jurisdiction of residence or organization is set forth on its signature page.
Section 4.9 Independent Decision. The Purchaser has independently evaluated the investment and acknowledges that the Preferred Shares are speculative and involve substantial risk.
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Section 4.10 Trust Account Waiver. The Purchaser acknowledges that Piermont has established a trust account for the benefit of its public shareholders and that, before the Merger Closing, funds held in that account may be released only as described in Piermont’s organizational documents and SEC reports. The Purchaser irrevocably waives any right, title, interest or claim of any kind against the trust account, and agrees not to seek recourse against the trust account, in each case solely with respect to any claim arising out of this Agreement or the transactions contemplated hereby. This waiver does not limit (a) any right of the Purchaser arising from ownership of Piermont securities independently of this Agreement, including a validly exercised redemption right, (b) any claim against assets held outside the trust account or funds released from the trust account following the Merger Closing, or (c) any right to enforce this Agreement after the Merger Closing.
ARTICLE V
COVENANTS
Section 5.1 Use of Proceeds. Pubco shall use the net proceeds for working capital, growth initiatives, transaction expenses and general corporate purposes and not for (a) dividends or repurchases of Junior Stock, (b) settlement of related-party liabilities outside the ordinary course, or (c) any activity that violates Applicable Law.
Section 5.2 Reservation and Listing of Common Stock. Pubco shall at all times reserve the number of shares of Common Stock required under the Certificate of Designations. It shall promptly apply to list all Conversion Shares and Closing Fee Shares on the Principal Market and use best efforts to maintain such listing and DTC eligibility while any Preferred Shares or Registrable Securities remain outstanding.
Section 5.3 Transfer Agent Instructions; Legends. Pubco shall deliver irrevocable instructions directing the Transfer Agent to issue the Securities in accordance with the Transaction Documents. Certificates or book entries may bear a Securities Act legend until the applicable shares are registered or eligible for resale under Rule 144 without volume or manner-of-sale limitations. Upon satisfaction of those conditions and delivery of customary representations reasonably requested by counsel, Pubco shall cause the legend to be removed within two Trading Days, without requiring a legal opinion from the Purchaser unless reasonably required by the Transfer Agent and not supplied by Pubco counsel.
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Section 5.4 Registration Rights. Pubco shall prepare and file, no later than thirty (30) calendar days after the First Closing Date (the “Filing Deadline”), a Registration Statement covering the resale of a number of shares of Common Stock equal to 200% of the maximum number of Registrable Securities issuable upon conversion in full of the Preferred Stock at the initial Floor Price (without regard to any conversion limitations) (plus without limiting Pubco’s obligations under Section 2.4, the Closing Fee Shares, if and to the extent not then freely tradable by the Purchaser without restriction), and shall use its best efforts to cause the Registration Statement to be declared effective as soon as practicable, but no later than thirty (30) calendar days after the Filing Deadline if not reviewed by the Commission, and no later than sixty (60) calendar days after the Filing Deadline if reviewed (the “Effectiveness Deadline”). If the number of shares of Common Stock covered by effective Registration Statements is at any time less than 200% of the number of Registrable Securities issuable upon conversion in full of the Preferred Stock at the then-current Floor Price, Pubco shall file an additional Registration Statement covering the resale of the shortfall within fifteen (15) calendar days after written notice thereof from the Purchaser (an “Additional Filing Deadline”), and shall use its best efforts to cause such additional Registration Statement to be declared effective as soon as practicable, but no later than thirty (30) calendar days after the Additional Filing Deadline if not reviewed by the Commission, and no later than sixty (60) calendar days after the Additional Filing Deadline if reviewed (an “Additional Effectiveness Deadline”). If: (i) any Registration Statement required to be filed pursuant to this Section 5.4 is not filed with the Commission on or prior to the Filing Deadline or the applicable Additional Filing Deadline; (ii) any Registration Statement is not declared effective by the Commission on or prior to the Effectiveness Deadline or the applicable Additional Effectiveness Deadline; (iii) after a Registration Statement is declared effective, the Purchaser is unable to use the prospectus included therein to resell its Registrable Securities for any reason (other than during a Grace Period); or (iv) Pubco fails for any reason to satisfy the current public information requirement under Rule 144 (each, a “Registration Event”, and the date on which any Registration Event occurs, an “Event Date”), then, as partial relief for the damages to the Purchaser by reason thereof (which the Parties agree are not capable of precise quantification), Pubco shall pay to the Purchaser an amount in cash equal to five percent (5.0%) of the aggregate Purchase Price paid for the Preferred Shares then outstanding, and an additional five percent (5.0%) of such aggregate Purchase Price on each thirty (30)-day anniversary of the Event Date (prorated for any period of less than thirty (30) days) until the applicable Registration Event is cured (such payments, the “Liquidated Damages”). The Liquidated Damages shall be paid within two (2) Trading Days after the Event Date and within two (2) Trading Days after each subsequent thirty (30)-day anniversary until the applicable Registration Event is cured. If Pubco fails to pay any Liquidated Damages when due, Pubco shall pay interest thereon at a rate of eighteen percent (18%) per annum (or such lesser maximum rate permitted by Applicable Law) until paid in full. Pubco’s obligation to pay Liquidated Damages is a continuing obligation and shall not terminate until all unpaid Liquidated Damages have been paid, notwithstanding that the Preferred Shares may have been converted, redeemed or cancelled. The Liquidated Damages are in addition to, and not in lieu of, any other remedies available to the Purchaser under the Transaction Documents, at law or in equity. Notwithstanding the foregoing, no Registration Event shall be deemed to have occurred, and no Liquidated Damages (or interest thereon) shall accrue, (A) under clause (ii) above, for any period during which the failure of a Registration Statement to be declared effective results from the review of, or comments on, such Registration Statement by the Commission or its staff (including any period following Pubco’s request for acceleration of effectiveness), provided that Pubco has filed such Registration Statement on or before the applicable Filing Deadline or Additional Filing Deadline, responds to each comment of the Commission’s staff within [ten (10)] Business Days after receipt thereof (or such longer period as is reasonably required to prepare any financial statements or other information requested by the Commission’s staff), and requests acceleration of effectiveness within two (2) Business Days after being notified that the Commission has no further comments or will not review such Registration Statement, or (B) with respect to any Registration Event, for any period during which such Registration Event results from an Excusable Delay or from the Purchaser’s failure to timely furnish the information required of it under this Section 5.4; provided, in each case, that Pubco continues to use its best efforts to cure the applicable Registration Event as promptly as practicable. Notwithstanding the foregoing, if the Commission or applicable Commission rules, regulations or interpretations (including Rule 415) limit the number of shares that may be included in any Registration Statement, or Pubco is not eligible under applicable rules and regulations of the Commission or the requirements of the applicable registration form to register the full number of shares otherwise required by this Section, Pubco shall include the maximum number of shares permitted, shall not be deemed in breach of this Section as a result, and shall register the excluded shares on one or more additional Registration Statements as promptly as Pubco is permitted to do so. Pubco shall notify the Purchaser in writing within one (1) Business Day after (x) any Registration Statement is declared effective, (y) the issuance of any stop order or the suspension of the effectiveness of any Registration Statement or of the qualification of the Registrable Securities in any jurisdiction, or (z) the occurrence of any event as a result of which the prospectus contains an untrue statement of a material fact or omits a material fact required to be stated therein or necessary to make the statements therein not misleading, and shall promptly prepare and file any supplement or amendment necessary to correct the same. Pubco shall keep each Registration Statement continuously effective and the prospectus current until the earlier of (a) the date all Registrable Securities have been sold and (b) the date all Registrable Securities may be sold under Rule 144 without volume or manner-of-sale limitations; provided that Pubco may suspend use of the prospectus for up to ten (10) consecutive calendar days (and no more than twenty (20) calendar days in the aggregate in any 365-day period) if its board of directors determines in good faith that continued use would require premature disclosure of material non-public information (each such period, a “Grace Period”); provided, further, that Pubco shall promptly notify the Purchaser in writing of the commencement and termination of each Grace Period (without disclosing the content of such information). Pubco shall bear all registration expenses other than the Purchaser's underwriting discounts, selling commissions and legal fees in excess of $5,000 for review of any registration filing. The Purchaser shall timely furnish customary selling-stockholder information and comply with prospectus-delivery requirements, and no material delay attributable to the Purchaser's failure to do so shall constitute a breach by Pubco.
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Section 5.5 Demand and Piggyback Registration. If the Registration Statement required by Section 5.4 is not effective when Registrable Securities remain outstanding (or does not cover the resale of all Registrable Securities required to be covered pursuant to Section 5.4), the Purchaser may make written demands that Pubco file a registration statement covering such securities, and Pubco shall use best efforts to file within twenty (20) calendar days. If Pubco proposes to register Common Stock for its own account or another holder’s account, other than on Form S-4 or S-8 or a similar form, it shall give the Purchaser at least ten (10) calendar days’ prior written notice and include all Registrable Securities requested by the Purchaser, subject to customary underwriter cutbacks; provided that, in the event of any such cutback, the Registrable Securities requested to be included shall be included in priority to any securities to be registered for the account of Pubco or any other holder, other than securities held by Persons having registration rights under any registration rights agreement in effect on the Execution Date or to be entered into at the Merger Closing as contemplated by the Merger Agreement, in each case as identified in Exhibit 3.5 (the “Existing Registration Rights Agreements”), which securities shall have such priority relative to the Registrable Securities as is required by the terms of the Existing Registration Rights Agreements as in effect on the Execution Date (or, in the case of any such agreement to be entered into at the Merger Closing, in the form contemplated by the Merger Agreement as of the Execution Date), it being understood that nothing in this Section 5.5 shall require Pubco to breach any Existing Registration Rights Agreement.
Section 5.6 Public Disclosure. No later than 9:00 a.m. New York time on the fourth Business Day after the Execution Date, the Seller Parties shall publicly disclose the material terms of the transactions by filing or furnishing a Current Report on Form 8-K or other appropriate public filing, attaching the material Transaction Documents if required. Upon such disclosure, the Seller Parties shall have disclosed all material nonpublic information provided to the Purchaser. No Seller Party shall thereafter provide material nonpublic information to the Purchaser without its prior written consent and an agreement specifying the cleansing date.
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Section 5.7 SEC Reports; Rule 144. While any Preferred Shares or Registrable Securities remain outstanding, Pubco shall timely file all reports required by the Exchange Act, maintain current public information under Rule 144, and furnish the Purchaser, upon reasonable request, a written statement as to its compliance.
Section 5.8 Form D and Blue Sky. Pubco shall timely file a Form D with respect to the sale of the Preferred Shares and make all filings and take all actions reasonably necessary to qualify the Securities for sale under applicable state securities laws, excluding any requirement to qualify to do business or consent to general service of process where it is not otherwise subject.
Section 5.9 Equal Treatment; Amendments. Pubco shall not amend, waive or modify any material economic term of the Preferred Shares for another holder without offering the Purchaser the same treatment. No consideration shall be offered or paid to any holder to amend or waive a provision unless offered pro rata to all affected holders.
Section 5.10 Corporate Existence; Compliance. Pubco shall preserve its corporate existence and material rights, maintain material permits and insurance, and comply in all material respects with Applicable Law, except as otherwise permitted by the Certificate of Designations.
Section 5.11 Further Assurances and Due Diligence. Before each Closing, the Seller Parties shall provide the Purchaser and its advisors reasonable access to information and personnel for confirmatory due diligence, subject to confidentiality obligations and privilege. No such investigation limits any representation, warranty or remedy. Each Party shall execute further documents and take further actions reasonably necessary to carry out the Transaction Documents.
Section 5.12 Fees and Expenses. Except as provided in Section 2.7 and Article VIII, each Party shall bear its own fees and expenses. Pubco shall pay all transfer-agent fees, filing fees, listing fees, stamp and issuance taxes and similar charges relating to issuance of the Securities.
Section 5.13 Leak-Out Restrictions. Unless waived in writing by Pubco, on any Trading Day the Purchaser shall not effect, prior to the earlier of the date of (a) the termination of this Agreement, and (b) the consummation of the Second Closing, any direct or indirect (including, but not limited to, short sales or hedging transactions), open-market sales of Common Stock received as Closing Fee Shares or upon conversion of Preferred Shares; provided, however, that Purchaser may sell an amount of such shares on any given trading day that does not exceed the greater of (i) $75,000 divided by the closing price on the trading day prior to such given trading day; and (ii) 8% of the trading volume on the date of trading. The Purchaser shall use commercially reasonable efforts to provide, upon reasonable request, a daily trading report sufficient to confirm compliance, without disclosing proprietary strategy.
Section 5.14 No Restriction on Trading. Except for the Leak-Out Restrictions, compliance with securities laws and any written confidentiality agreement voluntarily entered into by the Purchaser, nothing in the Transaction Documents restricts the Purchaser from trading any security. Pubco acknowledges and agrees that neither the Purchaser nor any equity holder, director, officer, or affiliates thereof is a fiduciary of Pubco and has no duty to refrain from trading while not in possession of material nonpublic information.
Section 5.15 Prepayment and Redemption. Pubco may redeem all or any portion of the outstanding Preferred Shares upon fifteen (15) Business Days’ prior written notice for cash equal to 110% of the outstanding Stated Value being redeemed plus all other amounts then due, strictly in accordance with the Certificate of Designations. The Purchaser may convert any Preferred Shares subject to redemption at any time before payment in full.
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Section 5.16 Integration with Certificate of Designations. Pubco shall perform all covenants in the Certificate of Designations, including conversion, reservation, adjustment, beneficial-ownership limitation, redemption, triggering-event and protective-vote provisions. If an inconsistency exists concerning the rights, preferences or limitations of the Preferred Shares, the Certificate of Designations controls; for contractual obligations among the Parties, this Agreement controls.
Section 5.17 Closing Fee Source. If Closing Fee Shares are transferred by legacy Tigerless stockholders, the Seller Parties shall obtain and deliver executed transfer documents, representations of authority and title, and any necessary consents. Failure by a transferring stockholder does not excuse Pubco’s obligation to deliver the full number of Closing Fee Shares.
Section 5.18 Tax Treatment. The Parties shall report the issuance of the Preferred Shares and Closing Fee Shares consistently with their form and substance under the Transaction Documents unless otherwise required by a final determination of a taxing authority. Pubco makes no representation concerning the Purchaser’s tax consequences.
Section 5.19 Stockholder Approval. If at any time the Principal Market determines, or Pubco otherwise concludes, that approval of Pubco’s stockholders is required under the rules of the Principal Market for the issuance of any of the Securities, Pubco shall promptly notify the Purchaser and shall seek such approval at the next meeting of its stockholders (or, if permitted, by written consent) and, if not obtained, at each subsequent annual or special meeting until obtained. Failure by Pubco to comply with this Section 5.19 shall constitute a Pubco Default; provided that the failure of Pubco’s stockholders to grant any such approval, notwithstanding Pubco’s compliance with this Section 5.19, shall not constitute a Pubco Default, a Triggering Event or a breach of any representation, warranty or covenant hereunder, and the Purchaser’s sole remedy in respect thereof shall be the condition set forth in Section 6.2(j).
ARTICLE VI
CONDITIONS TO CLOSING
Section 6.1 Conditions to the Purchaser’s Obligations at the First Closing. The Purchaser’s obligation to fund the First Closing is subject to satisfaction or written waiver by the Purchaser of the following: (a) the Merger Closing has occurred in accordance with the Merger Agreement, and any amendment or waiver required to permit the funding schedule set forth in Sections 2.2 and 2.3 has become effective, in each case without any other amendment materially adverse to the Purchaser or the Securities; (b) the Seller Parties’ representations and warranties are true and correct in all respects (and those qualified by materiality are true and correct in all respects) as of the First Closing; (c) the Seller Parties have performed and complied with, in all respects, all covenants and other obligations required to be performed or complied with by them under the Transaction Documents by the First Closing; (d) no Material Adverse Effect has occurred since the Execution Date; (e) no law or order prohibits the transactions; (f) the Certificate of Designations has been filed and is effective; (g) the Closing Fee Shares have been delivered as required by Section 2.4; (h) the Common Stock is listed on the Nasdaq and not suspended; (i) Pubco has sufficient authorized and reserved Common Stock, as specified in the Certificate of Designations; and (j) the deliveries in Sections 2.5 and 2.7 have been made.
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Section 6.2 Conditions to the Purchaser’s Obligations at the Second Closing. The Purchaser’s obligation to fund the Second Closing is subject only to: (a) the First Closing having occurred; (b) the fundamental representations in Sections 3.1 through 3.4 and 3.23 being true and correct in all respects, and all other representations and warranties of the Seller Parties being true and correct in all material respects, in each case as of the Second Closing Date; (c) no Triggering Event under the Certificate of Designations having occurred that is continuing and has not been cured (within any applicable cure period) or waived; (d) Pubco having performed and complied with, in all material respects, all covenants and other obligations required to be performed or complied with by it under the Transaction Documents at or before the Second Closing Date, including its payment, issuance, registration, listing and public-reporting obligations; (e) no law or order prohibiting the Second Closing; (f) Pubco having delivered the required bring-down documents; (g) Pubco’s Common Stock is listed on Nasdaq and trading thereof has not been suspended and no delisting notice has been received by Pubco from Nasdaq; (h) no Pubco Default having occurred that is continuing (it being understood that no event shall constitute a Pubco Default for purposes of this clause (h) until the expiration of any applicable cure period under Section 2.4 or Section 7.3 without cure, and that any Pubco Default that has been cured or waived shall be disregarded); (i) all registration statements required to be filed under the terms of this Agreement prior to the time of the Second Closing have been filed and, to the extent the applicable Effectiveness Deadline or Additional Effectiveness Deadline has occurred prior to the Second Closing Date, are effective (other than to the extent the failure to be effective is excused under Section 5.4); (j) if (and only if) approval of Pubco’s stockholders is required under the rules of the Principal Market for the issuance of any of the Securities (without regard to any beneficial-ownership limitation, but after giving effect to any limitation on the aggregate number of shares of Common Stock issuable under the Certificate of Designations that is intended to comply with such rules), such approval having been obtained (it being understood that this clause (j) shall be deemed satisfied if no such approval is required or if such approval has been obtained); and (k) Pubco having delivered each installment of the Closing Fee Shares required to have been delivered under Section 2.4 on or before the Second Closing Date, and no failure to deliver any such installment when due having continued beyond the applicable Fee Share Cure Period. For purposes of this Section 6.2, any failure to deliver Closing Fee Shares that is cured within the Fee Share Cure Period, or that occurs during the continuance of an Excusable Delay, shall be disregarded and shall not constitute a failure of any condition set forth in this Section 6.2 (including clauses (b), (c), (d), (h) and (k)). A decline in the market price or trading volume of the Common Stock, standing alone, is not a failure of a condition.
Section 6.3 Conditions to Pubco’s Obligations. Pubco’s obligation at each Closing is subject to: (a) the Purchaser’s representations being true and correct in all material respects; (b) the Purchaser having performed its material obligations due at such Closing; and (c) no law or order prohibiting the Closing.
Section 6.4 Frustration of Conditions. No Party may rely on failure of a condition if such failure was principally caused by that Party’s breach or failure to use commercially reasonable efforts to cause the condition to be satisfied.
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ARTICLE VII
TERMINATION; EVENTS OF DEFAULT; REMEDIES
Section 7.1 Termination Before First Closing. This Agreement may be terminated before the First Closing (a) by mutual written consent, (b) by either the Purchaser or the Seller Parties, acting jointly, if the Merger Agreement is validly terminated, (c) by the Purchaser if the First Closing has not occurred by December 31, 2026 (the “Outside Date”), unless principally caused by the Purchaser’s breach (provided that the Purchaser may extend the Outside Date by up to 30 days in its sole discretion if the First Closing has not occurred by such date), or (d) by either non-breaching Party if another Party materially breaches and fails to cure within ten Business Days after written notice, if curable. Termination does not affect accrued rights, confidentiality, expense reimbursement, indemnification or provisions intended to survive.
Section 7.2 Purchaser Failure to Fund. If all conditions to a Closing have been satisfied or waived and the Purchaser fails to timely fund, Pubco may seek specific performance or terminate the unfunded commitment after five Business Days’ written notice. Pubco’s remedies are subject to its duty to mitigate and do not include consequential or punitive damages, except for fraud or willful misconduct.
Section 7.3 Pubco Default. A “Pubco Default” occurs upon: (a) failure to issue Preferred Shares or deliver Conversion Shares when due, subject to applicable cure periods in the Certificate of Designations; (b) failure to pay any amount when due that continues for three Business Days; (c) material breach of a Transaction Document that is not curable, or continues for ten Business Days, if curable; (d) any representation or warranty of a Seller Party in a Transaction Document proving to have been false in any material respect when made (or, in the case of any representation or warranty qualified by materiality or Material Adverse Effect, false in any respect when made); (e) bankruptcy, insolvency, receivership or similar proceedings involving Pubco; (f) suspension or delisting of the Common Stock for more than one Trading Day, other than a general market suspension; or (g) invalidity or repudiation of a material Transaction Document. Any event constituting a Triggering Event under the Certificate of Designations shall also constitute a Pubco Default hereunder; provided that the remedies with respect to such Triggering Event shall be governed by the remedies therein. Each Pubco Default under clauses (a) through (g) above, Section 2.4 or Section 5.19 (but not a Pubco Default arising solely by reason of the immediately preceding sentence), once it has occurred and any applicable cure period under this Agreement has expired without cure, shall also constitute a Triggering Event under the Certificate of Designations (and the Certificate of Designations shall so provide), entitling the Purchaser to the remedies set forth therein in addition to the remedies provided in this Agreement; provided that (i) no event shall constitute a Pubco Default or a Triggering Event to the extent, and for so long as, it results from an Excusable Delay, and (ii) the Purchaser shall not be entitled to recover under both this Agreement and the Certificate of Designations for the same loss, and any liquidated damages and interest paid under Section 2.4 or Section 5.4 in respect of a failure shall be credited against any damages, default amounts or premiums payable under the Certificate of Designations in respect of the same failure and period.
Section 7.4 Remedies. Upon a Pubco Default, the Purchaser may exercise all rights under the Transaction Documents and Applicable Law, including specific performance, conversion, redemption where expressly provided, damages and reimbursement of reasonable enforcement costs. Remedies are cumulative. No delay or omission operates as a waiver.
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Section 7.5 Specific Performance. The Parties acknowledge that monetary damages may be inadequate and that each Party is entitled to specific performance and injunctive relief to enforce this Agreement without proving actual damages or posting bond, in addition to other remedies.
ARTICLE VIII
INDEMNIFICATION
Section 8.1 Indemnification by the Seller Parties. The Seller Parties, jointly and severally through the Merger Closing and Pubco thereafter, shall indemnify, defend and hold harmless the Purchaser, its Affiliates and their respective directors, officers, partners, members, managers, employees, agents and controlling Persons (collectively, the "Purchaser Indemnified Parties") from and against any and all Losses arising out of or relating to (a) any breach of any representation, warranty, covenant or agreement made by any Seller Party in any Transaction Document, (b) any untrue statement or alleged untrue statement of a material fact contained in any Registration Statement or prospectus, or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances in which they were made, not misleading, except to the extent, but only to the extent, that such untrue statement, alleged untrue statement, omission or alleged omission is based solely upon written information regarding the Purchaser furnished by the Purchaser expressly for use therein, or (c) any action, suit, claim, inquiry, investigation or proceeding, whether commenced or threatened, by any Person (including any stockholder of Pubco and Pubco itself) arising out of or relating to the authorization, execution, delivery, performance or enforcement of any Transaction Document, the transactions contemplated thereby, or the acquisition, purchase, ownership, conversion, disposition or status of any Securities, except, in each case, to the extent that such Losses are finally judicially determined by a court of competent jurisdiction to have been proximately and solely caused by the fraud, gross negligence or willful misconduct of such Purchaser Indemnified Party.
Section 8.2 Indemnification Procedures. Promptly after receipt by a Purchaser Indemnified Party of notice of the commencement or threatened commencement of any action, suit, claim, inquiry, investigation or proceeding for which such Purchaser Indemnified Party may seek indemnification hereunder, such Purchaser Indemnified Party shall notify the Seller Parties in writing; provided that the failure to so notify the Seller Parties shall not relieve the Seller Parties or Pubco, as applicable, of any liability hereunder except to the extent materially prejudiced by such failure. The applicable Purchaser Indemnified Party shall have the right to control the defense, settlement and compromise of any such action, suit, claim, inquiry, investigation or proceeding with counsel of its choosing reasonably satisfactory to Pubco, and the Seller Parties or Pubco, as applicable, shall pay the reasonable fees and expenses of such counsel and all other reasonable costs of such defense as and when incurred. The Seller Parties or Pubco, as applicable, shall advance such fees, costs and expenses within five (5) Business Days after receipt of reasonable documentation thereof. Amounts so advanced shall not be repayable by any Purchaser Indemnified Party except to the extent it is finally judicially determined by a court of competent jurisdiction that the related Losses were proximately and solely caused by the fraud, gross negligence or willful misconduct of such Purchaser Indemnified Party. Pubco may participate in such defense with counsel of its own choosing and at its own expense. No Purchaser Indemnified Party shall settle or compromise any such action, suit, claim, inquiry, investigation or proceeding without the prior written consent of Pubco, which consent shall not be unreasonably withheld, conditioned or delayed and shall be deemed given if Pubco does not object in writing within five (5) Business Days after receipt of written notice of the proposed settlement or compromise; provided that no Purchaser Indemnified Party shall enter into any settlement or compromise that includes an admission of wrongdoing or liability by any Seller Party or imposes any non-monetary obligation on any Seller Party without Pubco's prior written consent.
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Section 8.3 Direct Claims. The indemnification obligations set forth in this Article VIII shall apply to direct claims between or among any Seller Party and any Purchaser Indemnified Party, including any claim asserted by any Seller Party against a Purchaser Indemnified Party, and shall not be limited to third-party claims. For the avoidance of doubt, and notwithstanding Section 9.12, the Losses indemnifiable under this Article VIII expressly include reasonable attorneys' fees, disbursements and other costs and expenses incurred by any Purchaser Indemnified Party in connection with any action, suit, claim, inquiry, investigation or proceeding between or among any Seller Party, on the one hand, and any Purchaser Indemnified Party, on the other hand, arising out of or relating to any Transaction Document or the transactions contemplated thereby. With respect to any direct claim for indemnification, the Purchaser Indemnified Party shall provide the Seller Parties or Pubco, as applicable, with written notice describing in reasonable detail the basis for such claim; provided that any failure or delay in providing such notice shall not relieve the Seller Parties or Pubco, as applicable, of their obligations hereunder except to the extent materially prejudiced thereby.
Section 8.4 Contribution. If the indemnification provided for in this Article VIII is unavailable or insufficient to hold harmless a Purchaser Indemnified Party in respect of any Losses for which indemnification is provided herein, then the Seller Parties or Pubco, as applicable, on the one hand, and the applicable Purchaser Indemnified Party, on the other hand, shall contribute to the amount paid or payable as a result of such Losses in such proportion as is appropriate to reflect the relative fault of the Seller Parties or Pubco, as applicable, and such Purchaser Indemnified Party in connection with the acts, statements or omissions that resulted in such Losses, as well as any other relevant equitable considerations. Notwithstanding anything to the contrary contained herein, in no event shall the aggregate amount required to be contributed by the Purchaser or any Purchaser Indemnified Party pursuant to this Section 8.4 exceed the net gain actually realized by the Purchaser from the Securities giving rise to such Losses, after deducting all expenses incurred by the Purchaser or such Purchaser Indemnified Party in connection with the applicable claim and any amounts previously paid by the Purchaser or any Purchaser Indemnified Party in respect thereof. No Person guilty of fraudulent misrepresentation within the meaning of Section 11(f) of the Securities Act shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation.
Section 8.5 Enforcement; Cumulative Remedies. The Seller Parties or Pubco, as applicable, shall reimburse each Purchaser Indemnified Party for all reasonable documented out-of-pocket fees and expenses, including reasonable attorneys' fees and disbursements, incurred in connection with the collection or enforcement of any amounts payable or rights arising under this Article VIII. The indemnification and contribution obligations contained in this Article VIII shall survive the execution and delivery of the Transaction Documents, each Closing, any investigation made by or on behalf of any Purchaser Indemnified Party and any transfer or disposition of the Securities. The rights and remedies provided in this Article VIII are cumulative and are in addition to, and not exclusive of, any other rights or remedies available to any Purchaser Indemnified Party under any Transaction Document, at law or in equity.
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Section 8.6 Survival. Notwithstanding any investigation made by or on behalf of any Purchaser Indemnified Party, and notwithstanding any Purchaser Indemnified Party's knowledge (however obtained) of any breach or inaccuracy, each representation and warranty of the Seller Parties contained in the Transaction Documents shall survive the execution and delivery of the Transaction Documents, each Closing and any transfer or disposition of the Securities, and shall remain in full force and effect until the later of (a) the sixth (6th) anniversary of the latest date on which such representation or warranty was made or deemed made and (b) the expiration of the statute of limitations applicable to a claim for breach of contract under the law specified in Section 9.2. Each covenant and agreement of the Seller Parties contained in the Transaction Documents shall survive each Closing in accordance with its terms and, in the case of any covenant or agreement required to be performed at or after a Closing, until fully performed and thereafter until expiration of the statute of limitations applicable to a claim for breach thereof. No provision of this Agreement shall be construed to shorten any statute of limitations otherwise applicable to any claim, and nothing in this Article VIII shall limit or restrict any claim based on fraud or intentional misrepresentation.
ARTICLE IX
MISCELLANEOUS
Section 9.1 Notices. All notices shall be in writing and delivered by email, together with optional personal delivery, or nationally recognized overnight courier delivery, and shall be deemed given upon receipt when transmitted by email before 5:00 p.m. New York time without a delivery-failure notice (otherwise the next Business Day). Notices shall be sent to the addresses on the signature pages, with a copy to the applicable counsel identified there (via email), or to an updated address given by notice. If any other form of notice delivery is required by contract or law, delivery shall only be deemed complete upon email copy of same being received by the receiving party.
Section 9.2 Governing Law. This Agreement and all claims arising out of or relating hereto shall be governed by the internal laws of the State of New York, without regard to conflict-of-laws principles. Matters concerning the corporate existence of Pubco or the validity and relative rights of its capital stock shall be governed by mandatory Nevada corporate law.
Section 9.3 Arbitration; Jurisdiction; Jury Trial Waiver. Each Party irrevocably submits, for purposes of any action to compel arbitration under this Section 9.3, to confirm or enforce any arbitral award, or to obtain provisional, injunctive or equitable relief (including under Section 7.5), to the exclusive jurisdiction of the state and federal courts located in New York County, New York, waives objections based on venue or inconvenient forum, and consents to service by the notice methods herein. EACH PARTY KNOWINGLY AND IRREVOCABLY WAIVES TRIAL BY JURY IN ANY ACTION ARISING OUT OF OR RELATING TO THE TRANSACTION DOCUMENTS. Each Party agrees that all legal proceedings concerning the interpretation, enforcement and defense of the transactions contemplated by any of the Transaction Documents (whether brought against a Party or its respective Affiliates, directors, officers, stockholders, employees or agents) shall be commenced exclusively by arbitration administered by Mediation and Civil Arbitration, Inc. d/b/a RapidRuling (www.rapidruling.com) (“RapidRuling”) in accordance with its Commercial Arbitration Rules effective at the time a claim is made (the “Rules”), and judgment on the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof. Arbitrators shall be appointed by RapidRuling. The place of arbitration shall be New York, New York, and any hearing shall be held via video or telephone conference. The Parties agree that no objection shall be taken to the decision, order or award of the tribunal following any such hearing on the basis that the hearing was held by video or telephone conference. The Parties consent to electronic service of process, with service to be made to the following email addresses: Pubco: [●], with a copy to bross@graubard.com; and the Purchaser: [●], with a copy to [●]. All such service of process may come from the opposing Party’s email address listed here or from efile@rapidruling.com. The Parties shall list all said email addresses as “safe senders” (or other whitelist) and are responsible to check their “SPAM” and “junk” type incoming messages on a daily basis. In any such arbitration award, the arbitrator shall require the breaching Party (if any), as finally determined by the arbitrator, to pay the non-breaching Party’s costs and expenses (including such non-breaching Party’s reasonable attorneys’ fees, arbitration costs, court costs and other expenses) associated with enforcing the Transaction Documents and collecting any award or judgment related thereto.
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Section 9.4 Assignment. No Seller Party may assign this Agreement or its obligations without the Purchaser’s prior written consent. The Purchaser may assign all or part of its rights with a transfer of corresponding Securities to an Affiliate or other permitted transferee that agrees in writing to be bound. No assignment releases the assignor from accrued obligations unless the other Parties consent.
Section 9.5 Successors and Assigns; No Third-Party Beneficiaries. This Agreement binds and benefits the Parties and their permitted successors and assigns. Except for indemnified parties under Article VIII, no other Person is a third-party beneficiary.
Section 9.6 Amendments and Waivers. This Agreement may be amended only by a writing signed by the Seller Parties and the Purchaser. A waiver is effective only in writing and only for the specific instance. No course of dealing constitutes a waiver.
Section 9.7 Entire Agreement. The Transaction Documents constitute the entire agreement concerning their subject matter and supersede the preliminary term sheet and all prior discussions and agreements, except any confidentiality agreement that expressly survives.
Section 9.8 Severability. If a provision is held invalid or unenforceable, it shall be modified to the minimum extent necessary to make it enforceable while preserving intent, and the remaining provisions remain effective.
Section 9.9 Counterparts; Electronic Signatures. This Agreement may be executed in counterparts, each deemed an original and together one instrument. PDF and electronic signatures have the same effect as originals.
Section 9.10 No Partnership or Agency. Nothing creates a partnership, joint venture, fiduciary, agency or similar relationship. The Purchaser acts solely as an arm’s-length purchaser.
Section 9.11 Further Assurances. Each Party shall execute documents and take actions reasonably requested to effect the intent of this Agreement.
Section 9.12 Expenses of Enforcement. The prevailing Party in a final, nonappealable action to enforce a Transaction Document is entitled to reasonable attorneys’ fees and costs, without duplication of Article VIII; provided that nothing in this Section 9.12 shall limit, reduce or condition any amount payable to a Purchaser Indemnified Party under Article VIII..
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Section 9.13 Confidentiality. Until public disclosure under Section 5.6, each Party shall keep the transaction and nonpublic information confidential, subject to disclosures to advisors bound by confidentiality, financing sources, regulators, courts or as required by law. If legally permitted, the disclosing Party shall give prior notice and seek confidential treatment.
Section 9.14 Headings; Interpretation. Headings are for convenience only. The Parties and their counsel have jointly negotiated the Agreement, and no rule construing ambiguities against a drafter applies.
Section 9.15 Independent Nature of Purchaser’s Obligations. If additional purchasers execute separate purchase agreements, the obligations of each purchaser are several and not joint, and no purchaser is responsible for another purchaser’s performance. Nothing creates a “group” for purposes of Section 13(d) of the Exchange Act.
Section 9.16 Maximum Payments. No amount payable shall exceed the maximum lawful amount. Any excess shall be applied to reduce lawful amounts owed or refunded.
Section 9.17 Business Days. If an action is due on a day that is not a Business Day, it is due on the next Business Day, except where the Certificate of Designations expressly provides otherwise.
[Signature Pages Follow]
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SIGNATURE PAGE TO
SECURITIES PURCHASE AGREEMENT
IN WITNESS WHEREOF, the Parties have executed this Securities Purchase Agreement as of the Execution Date.
TIGERLESS AI HOLDINGS INC.
| By: | /s/ Zikang Wu |
|
| Name: | Zikang Wu |
|
| Title: | Chief Executive Officer |
|
Address: 450 7th Avenue, Suite 905, New York, New York 10123
Email: [EMAIL]
With a copy to: Graubard Miller, 405 Lexington Avenue, 44th Floor, New York, New York 10174, Attention: Brian L. Ross, Esq., Email: bross@graubard.com
PIERMONT VALLEY ACQUISITION CORP.
| By: | /s/ Wei Qian |
|
| Name: | Wei Qian |
|
| Title: | Chief Executive Officer |
|
Address: 732 S 6th Street, #5386, Las Vegas, Nevada 89101
Email: [EMAIL]
TIGERLESS HEALTH, INC.
| By: | /s/ Zikang Wu |
|
| Name: | Zikang Wu |
|
| Title: | Chief Executive Officer |
|
Address: 450 7th Avenue, Suite 905, New York, New York 10123
Email: [EMAIL]
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PURCHASER SIGNATURE PAGE TO
SECURITIES PURCHASE AGREEMENT
Capstan Point, LLC
| By: | /s/ Yin Liang |
|
| Name: | Yin Liang |
|
| Title: | Manager |
|
Jurisdiction of Organization: Delaware
Address: 8 The Green, Suite #27074, Dover, DE 19901
Email: __________________________________________________
Tax ID: _________________________________________________
Name in Which Preferred Shares Should Be Registered: Capstan Point, LLC
DTC Participant/Account Information (if applicable): ______________________________
Purchase Commitment: $5,000,000
First Closing Purchase Price: $3,500,000
Second Closing Purchase Price: $1,500,000
With a copy to Purchaser’s counsel:
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SCHEDULE I
PURCHASER AND FUNDING SCHEDULE
| Purchaser |
| Preferred Shares |
|
| Total Purchase Price |
|
| First Tranche Shares |
|
| First Tranche Price |
|
| Second Tranche Shares |
|
| Second Tranche Price |
| ||||||
| Capstan Point, LLC |
|
| 5,000 |
|
| $ | 5,000,000 |
|
|
| 3,500 |
|
| $ | 3,500,000 |
|
|
| 1,500 |
|
| $ | 1,500,000 |
|
Note: The Closing Fee Shares are in addition to the Preferred Shares and Purchase Price shown above.
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EXHIBIT A
FORM OF CERTIFICATE OF DESIGNATIONS
The Certificate of Designations of Series A Convertible Preferred Stock of Tigerless AI Holdings Inc. is the separately delivered form agreed by the Parties and incorporated herein by reference. At the First Closing, the filed Certificate of Designations shall be identical in all material respects to that agreed form, except for completion of dates, officer information and other ministerial filing information.
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EXHIBIT B
FORM OF IRREVOCABLE TRANSFER AGENT INSTRUCTIONS
TIGERLESS AI HOLDINGS INC.
[●]
AUTHORIZATION LETTER
Dated: [●], 2026
By electronic mail ([●])
Continental Stock Transfer & Trust Company
1 State Street, 30th Floor, New York, New York 10004
Re: Irrevocable Transfer Agent Instructions — Tigerless AI Holdings Inc.
[NTD: PARTIES TO CONFIRM NUMBERS BELOW]
Ladies and Gentlemen:
Reference is made to the transfer agency and registrar services agreement (the “Transfer Agreement”) between Tigerless AI Holdings Inc. (the “Company”) and Continental Stock Transfer & Trust Company and to that certain Securities Purchase Agreement, dated as of [●], 2026 (as amended, restated, supplemented or otherwise modified from time to time, the “Securities Purchase Agreement”), by and among the Company, a Nevada corporation, Piermont Valley Acquisition Corp., a Cayman Islands exempted company, Tigerless Health, Inc., a New York corporation, and the purchaser signatory thereto (the “Purchaser”). Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Securities Purchase Agreement or, if not defined therein, in the Certificate of Designations. Continental Stock Transfer & Trust Company, in its capacity as transfer agent and registrar for the Class A common stock, par value $0.00001 per share, of the Company (the “Common Stock”) and for the Series A Convertible Preferred Stock, par value $0.00001 per share, of the Company (the “Preferred Stock”), is referred to herein as the “Transfer Agent.”
In connection with the transactions contemplated by the Securities Purchase Agreement and the other Transaction Documents, the Company has agreed (i) to issue to the Purchaser an aggregate of 5,000 shares of Preferred Stock (the “Preferred Shares”) in two tranches at the First Closing and the Second Closing and(ii) to issue, or to reserve for issuance, shares of Common Stock upon conversion of the Preferred Shares (the “Conversion Shares”). The Conversion Shares are referred to herein, collectively, as the “Securities Shares.” This letter constitutes the Company’s irrevocable instructions to the Transfer Agent with respect to the Preferred Shares and the Securities Shares (these “Instructions”).
The Company hereby irrevocably authorizes and directs the Transfer Agent as follows:
1. Issuance of Preferred Stock at Closings. On the First Closing Date, the Transfer Agent is hereby authorized and instructed, without any further act, instruction, consent or confirmation of the Company being required, to issue and record on the Company’s stock ledger 3,500 Preferred Shares in book-entry (uncertificated) form registered in the name of the Purchaser, and on the Second Closing Date to issue and record on the Company’s stock ledger an additional 1,500 Preferred Shares in book-entry (uncertificated) form registered in the name of the Purchaser, and in each case to deliver to the Purchaser a statement of holding evidencing such issuance. Such Preferred Shares shall bear a notation of the restrictive legend set forth in Section 7. The Company shall deliver written notice of each of the First Closing Date and the Second Closing Date to the Transfer Agent, with a copy to the Purchaser.
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2. Share Reserve. The Company has directed the Transfer Agent to reserve, and the Transfer Agent shall reserve and keep available at all times, free of preemptive or similar rights, from the Company’s duly authorized and unissued Common Stock, a number of shares of Common Stock equal to not less than 200% of the number of shares of Common Stock necessary to effect the conversion in full of the Preferred Shares then outstanding (without regard to any beneficial-ownership or other limitations on conversion) at the Floor Price or Adjusted Floor Price, as applicable, then in effect as set forth in the Certificate of Designations, which the Company represents is initially [●] shares of Common Stock (the “Share Reserve”). The Company and the Purchaser will have equal and independent authority to increase the Share Reserve so that the number of shares of Common Stock reserved is at all times not less than the amount described in the preceding sentence. The Transfer Agent shall not use the Share Reserve for any purpose other than the issuance of Conversion Shares in accordance with these Instructions. If at any time the Share Reserve is insufficient, the Company shall promptly take all corporate action necessary to authorize and reserve a sufficient number of shares of Common Stock, including obtaining any required stockholder or board authorization.
3. Issuance of Conversion Shares. Upon the Transfer Agent’s receipt from the Purchaser or the Company of (a) a Conversion Notice under the Certificate of Designations (an “Issuance Notice”), and (b) any other documentation expressly required by these Instructions, the Transfer Agent shall, no later than twenty-four (24) hours after such receipt, issue and deliver the number of shares of Common Stock specified in such Issuance Notice to or upon the order of the Purchaser, without any further act, instruction, consent or confirmation of the Company being required. In addition, upon the Transfer Agent’s receipt of a written notice from the Purchaser stating that the Company has failed to timely deliver shares of Common Stock and that the Purchaser is entitled to additional shares of Common Stock pursuant to the buy-in or other failure-to-deliver remedies set forth in the Certificate of Designations, the Transfer Agent is hereby authorized and instructed to issue and deliver to the Purchaser the number of additional shares of Common Stock specified in such notice, without any further act, instruction, consent or confirmation of the Company being required. The Transfer Agent shall issue shares of Common Stock pursuant to these Instructions notwithstanding any threatened or pending dispute, claim or proceeding between the Company and the Purchaser relating to the Certificate of Designations or the Securities Purchase Agreement, unless, prior to the applicable issuance deadline, the Transfer Agent has received a court order expressly prohibiting such issuance, together with a certified copy thereof.
4. Redemption of Preferred Stock. Upon the Transfer Agent’s receipt of written notice from the Company, duly countersigned by the Purchaser (the Purchaser’s signature not to be unreasonably withheld), or from the Purchaser, confirming that the Company has paid to the Purchaser the Company Optional Redemption Price for Preferred Shares redeemed pursuant to Section 9 of the Certificate of Designations (a “Redemption Notice”), the Transfer Agent is hereby authorized and instructed, without any further act, instruction, consent or confirmation of the Company being required, to record the cancellation of the number of Preferred Shares specified in such Redemption Notice on the Company’s stock ledger. Nothing in this Section shall require the Transfer Agent to make, hold, or disburse any redemption payment, which the Company shall pay directly to the Purchaser.
5. Electronic Delivery. If the conditions for unlegended issuance set forth in Section 7 are satisfied, the Transfer Agent shall deliver such shares of Common Stock electronically by crediting the account of the Purchaser’s prime broker with the Depository Trust Company (“DTC”) through its Deposit/Withdrawal at Custodian (“DWAC”) system. If such conditions are not satisfied, the Transfer Agent shall deliver certificated shares of Common Stock bearing the legend set forth in Section 7 to the address specified in the applicable Issuance Notice.
6. Restrictive Legend. Except as provided in Section 7, all Preferred Shares and Securities Shares shall bear a restrictive legend in substantially the following form:
“THIS SECURITY HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY SUCH SECURITIES.”
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7. Unlegended Shares; Removal of Legend. The Transfer Agent shall issue Securities Shares free of any restrictive legend, and (as applicable) shall remove any restrictive legend from outstanding Securities Shares and deliver them via DWAC, promptly and in no event later than twenty-four (24) hours following its receipt of a request from the Purchaser accompanied by the items specified below, provided that any of the following conditions have been satisfied:
(a) a registration statement covering the resale of such Securities Shares has been declared effective by the Commission under the Securities Act and such Securities Shares are subject thereto, accompanied by an opinion of counsel to the Company in form and substance reasonably satisfactory to the Transfer Agent, which opinion shall be delivered in accordance with Section 8;
(b) such Securities Shares are eligible for resale by the Purchaser pursuant to Rule 144 under the Securities Act without volume or manner-of-sale restrictions, accompanied by a customary representation letter from the Purchaser and an opinion of counsel to the Company in form and substance reasonably satisfactory to the Transfer Agent, which the Company shall cause its counsel to deliver in accordance with Section 8; or
(c) such Securities Shares may be sold, assigned or transferred pursuant to an effective registration statement or another available exemption from the registration requirements of the Securities Act, accompanied by an opinion of counsel to the Company in form and substance reasonably satisfactory to the Transfer Agent, which opinion shall be delivered in accordance with Section 8.
8. Company and Counsel Cooperation. The Company shall, at its expense, cause its legal counsel to deliver to the Transfer Agent all legal opinions reasonably requested by the Transfer Agent in connection with the issuance of unlegended Securities Shares or the removal of any restrictive legend in accordance with Section 2 or Section 7, and the Company hereby authorizes such counsel to rely on these Instructions and on the Transaction Documents in rendering any such opinion. The Transfer Agent shall be entitled to rely conclusively on any such opinion of counsel without independent investigation. If the Company fails or refuses to cause its counsel to deliver any such requested opinion within one (1) Trading Day of such request, the Purchaser may cause its own counsel to deliver such opinion to the Transfer Agent, and the Transfer Agent shall treat such opinion as an opinion delivered by the Company’s counsel for all purposes under these Instructions. From and after the first such failure by the Company, the Purchaser may thereafter cause its own counsel to deliver any such requested opinion to the Transfer Agent without regard to, and without waiting for the expiration of, the foregoing one (1) Trading Day period, and the Transfer Agent shall treat such opinion as an opinion delivered by the Company’s counsel for all purposes under these Instructions.
9. Irrevocable Instructions. The Company acknowledges and agrees that the Purchaser is relying upon these Instructions in entering into the Transaction Documents and that these Instructions are an inducement to the Purchaser to consummate the transactions contemplated thereby. Accordingly, these Instructions are irrevocable and may not be amended, modified, rescinded or supplemented, and no instruction inconsistent herewith shall be given to the Transfer Agent by the Company, in each case without the prior written consent of the Purchaser, which shall not be unreasonably withheld. The Transfer Agent shall not be bound by any contrary or inconsistent instruction from the Company unless accompanied by the written consent required by the preceding sentence. The Company further covenants that it shall not terminate, replace or remove the Transfer Agent, or appoint any successor or replacement transfer agent with respect to the Preferred Shares or the Securities Shares, unless, as a condition to and prior to the effectiveness of any such change, the successor or replacement transfer agent executes and delivers to the Purchaser irrevocable instructions substantially in the form of these Instructions. The Company’s obligations under these Instructions shall survive, and shall be binding upon the Company notwithstanding, any such termination, replacement or appointment.
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10. Indemnification of Transfer Agent. The Company agrees to indemnify and hold harmless the Transfer Agent and its officers, directors, employees and agents from and against any and all losses, claims, damages, liabilities and expenses (including reasonable attorneys’ fees) arising out of or in connection with the Transfer Agent’s performance of its duties in accordance with these Instructions, except to the extent finally determined to have resulted from the Transfer Agent’s gross negligence, willful misconduct or bad faith. The terms of the Transfer Agreement and any other separate transfer agent services agreement between the Company and the Transfer Agent shall remain in full force and effect, provided that, to the extent of any conflict with respect to the Preferred Shares or the Securities Shares, these Instructions shall govern. The Company hereby waives, and covenants not to commence or maintain, any claim, action or proceeding against the Transfer Agent arising out of or relating to the Transfer Agent’s compliance with these Instructions or with any notice, direction or instruction delivered by the Purchaser in accordance with these Instructions, except to the extent finally determined to have resulted from the Transfer Agent’s gross negligence, willful misconduct or bad faith.
11. Third-Party Beneficiary. The Purchaser is an express, intended third-party beneficiary of these Instructions and shall be entitled to enforce these Instructions against the Company and the Transfer Agent as if a party hereto.
12. Counterparts. These Instructions may be executed in counterparts (including by electronic transmission or electronic signature), each of which shall be deemed an original and all of which together shall constitute one and the same instrument.
Please acknowledge your agreement to, and acceptance of, these Instructions by countersigning below.
Very truly yours,
TIGERLESS AI HOLDINGS INC.
| By: |
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| Name: | Zikang Wu |
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| Title: | Chief Executive Officer |
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Acknowledged and agreed, and accepted as irrevocable instructions, as of the date first written above:
CONTINENTAL STOCK TRANSFER & TRUST COMPANY,
as Transfer Agent
| By: |
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| Name: | [NAME] |
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| Title: | [TITLE] |
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EXHIBIT C
ACCREDITED INVESTOR QUESTIONNAIRE
The undersigned represents that it is an “accredited investor” under Rule 501(a) of Regulation D because it satisfies one or more of the following categories (check all that apply):
[ ] A bank, registered broker-dealer, investment adviser, insurance company, registered investment company, business development company or small business investment company described in Rule 501(a)(1).
[ ] A private business development company described in Rule 501(a)(2).
[ ] An organization described in Section 501(c)(3) of the Internal Revenue Code, corporation, partnership or limited liability company, not formed for the specific purpose of acquiring the Securities, with total assets exceeding $5,000,000.
[ ] An entity in which all equity owners are accredited investors.
[ ] A trust with total assets exceeding $5,000,000, not formed for the specific purpose of acquiring the Securities, whose investment is directed by a sophisticated person.
[ ] An entity owning investments in excess of $5,000,000, not formed for the specific purpose of acquiring the Securities.
[ ] A family office with at least $5,000,000 in assets under management, not formed for the specific purpose of acquiring the Securities, whose investment is directed by a knowledgeable person.
[ ] Another category under Rule 501(a): ____________________________________________.
The undersigned agrees to provide reasonable supporting information upon request and certifies that the foregoing is true and complete.
[PURCHASER NAME]
| By: |
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| Name: | [NAME] |
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| Title: | [TITLE] |
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EXHIBIT D
FORM OF CLOSING CERTIFICATE
The undersigned, the duly authorized Chief Executive Officer of Tigerless AI Holdings Inc. (the “Company”), certifies pursuant to the Securities Purchase Agreement dated as of __________, 2026 (the “Purchase Agreement”) that, as of the [First/Second] Closing Date:
1. The representations and warranties of the Seller Parties in the Purchase Agreement are true and correct to the standard required by Section [6.1/6.2].
2. The Seller Parties have performed all covenants and obligations required to be performed at or before this Closing.
3. No law or order prohibits the Closing.
4. No Material Adverse Effect has occurred [and no Triggering Event has occurred and is continuing].
5. The Certificate of Designations remains duly filed, valid and effective.
6. The Company has sufficient authorized and reserved shares of Common Stock to satisfy the Transaction Documents.
7. The Common Stock remains listed on the Nasdaq and eligible for DTC settlement.
TIGERLESS AI HOLDINGS INC.
| By: |
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| Name: | Zikang Wu |
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| Title: | Chief Executive Officer |
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