CNTM 8-K
ConnectM Technology Solutions, Inc. (CNTM)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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Item 1.01 Entry into a Material Definitive Agreement.
Convertible Promissory Notes
Between the dates of November 26, 2024 and December 15, 2025, ConnectM Technology Solutions, Inc. (the “Company,” “our,” and “ConnectM”) entered into a series of Convertible Promissory Notes (each, a “Note” and collectively, the “Notes”) with multiple investors (each being a “Purchaser” or collectively “Purchasers”). The terms of the Notes were identical, except with respect to maturity dates, conversion price, the Purchaser name, date of issuance, and the principal amount invested, and the maturity dates.
The following Purchasers’ Notes had maturity dates between 30 - 40 days after issuance. The conversion prices were between $1.00 - $1.10 per share. The Purchaser name, date of issuance, and principal amount invested for each of the Notes are as follows:
| ● | GreenPicks Partners LLC on November 26, 2024 with $200,000 principal invested; |
| ● | Win-Light Global Co. Ltd. on December 3, 2024 with $400,000 principal invested; |
| ● | Arumilli LLC on March 17, 2025 with $250,000 principal invested; and |
| ● | Win-Light Global Co. Ltd. on March 17, 2025 with $250,000 principal invested. |
The following Purchasers’ Notes had maturity dates of 180 days after issuance. The conversion price was $1.10 per share. The Purchaser name, date of issuance, and principal amount invested for each of the Notes are as follows:
| ● | Ryan Fant on January 20, 2025 with $250,000 principal invested; |
| ● | John C. Gillian on January 22, 2025 with $50,000 principal invested; |
| ● | Christopher J. Joyce on January 23, 2025 with $100,000 principal invested; |
| ● | Patrick J. McCarthy on January 25, 2025 with $150,000 principal invested; |
| ● | Iffat Hussain on January 26, 2025 with $50,000 principal invested; |
| ● | Corey T. Lee on January 29, 2025 with $1,000,000 principal invested; |
| ● | Zachary Espelund on February 4, 2025 with $150,000 principal invested; and |
| ● | Kedar Muley on February 11, 2025 with $50,000 principal invested.; |
The following Purchasers’ Notes had maturity dates of 210 days after issuance. The conversion price was the lower of (a) $0.25 or (b) principal and interest divided by 90% of the lowest daily volume weighted average price (“VWAP”) of the common stock during the 3 trading day period prior to the measurement date. Purchaser name, date of issuance, and principal amount invested for each of the Notes are as follows:
| ● | Sameer Desai on May 26, 2025 with $156,000 invested*; |
| ● | Umesh Goradia on June 9, 2025 with $500,000 principal invested; |
| ● | Umesh Goradia on July 11, 2025 with $500,000 principal invested; |
| ● | Ashish Kulkarni on August 6, 2025 with $200,000 principal invested; |
| ● | Ashish Kulkarni on August 17, 2025 with $200,000 principal invested; |
| ● | Mahesh Kumar Navani Revocable Trust on August 29, 2025 with $500,000 invested |
| ● | Adv Health Technologies Ltd. on September 10, 2025 with $500,000 invested; |
| ● | Ashish Kulkarni on October 8, 2025 with $250,000 principal invested. |
| ● | Adv Health Technologies Ltd on November 25, 2025 with $500,000 invested; |
| ● | Umesh Goradia on December 2, 2025 with $250,000 invested; |
| ● | Mahesh Kumar Navani Revocable Trust on December 8, 2025 with $1,000,000 invested; |
| ● | Umesh Goradia on December 8, 2025 with $250,000 invested; and |
| ● | Vivek Bijoriya on December 8, 2025 with $50,000 invested. |
* Mr. Desai’s note was convertible solely at a price equal to 90% of the lowest daily VWAP of the Company’s common stock during the 3 trading days prior to the applicable measurement date and did not include the $0.25 per share conversion price floor applicable to the other notes.
The following Purchasers’ Notes had maturity dates of 365 days after issuance. The conversion price was $1.15. Purchaser name, date of issuance, and principal amount invested for each of the Notes are as follows:
| ● | Iffat Hussain on March 5, 2025 with $200,000 principal invested; |
| ● | Md Rabiul Hassan on March 21, 2025 with $30,000 invested; |
| ● | Ashish Kulkarni on April 1, 2025 with $150,000 principal invested; |
| ● | Software Ventures FZCO on April 1, 2025 with $100,000 invested; |
| ● | Md Rabiul Hassan on April 4, 2025 with $20,000 invested; and |
| ● | Kaseeb Billah on April 8, 2025 with $100,000 invested. |
The material terms of the Notes are set forth below:
| (a) | Maturity. The maturity date of the Notes are the amount of days after issuance as noted above, with any unpaid principal and interest paid at that time being payable on that date. |
| (b) | Interest. Interest shall accrue on any unpaid balance of the Notes after Maturity at a rate of 20% per annum. |
| (c) | Purpose. Monies loaned from the Purchaser to the Company as evidenced by the Notes shall be used by the Company for working capital purposes. |
| (d) | Events of Default. Events of default of the Notes include voluntary or involuntary actions by the Company resulting in a failure to perform obligations of conversion, including but not limited to: bankruptcy, insolvency, reorganization, liquidation, or other voluntary corporate actions made by the Company which may interfere with the obligations of conversion of the Notes. |
| (e) | Mechanics of Conversion. Not later than three business days after the Company’s receipt of a Notice of Conversion of the outstanding principal or interest, the Company shall deliver, or cause to be delivered, to the presenting Purchaser, a certificate or certificates representing the conversion of the Note or a portion thereof into common shares of the Company. Any Shares eligible for resale under Rule 144 shall have the restrictive legend removed at the cost of the Company. |
| (f) | Reserve. The Company shall, at all times, use reasonable efforts to keep in reserve the number of shares needed to affect the conversion of the Notes. |
| (g) | Covenants. Any shares issued upon conversion of the Notes when so issued, will be validly issued, fully paid and nonassessable and free from all taxes, liens and charges with respect to the issuance thereof. |
| (h) | Waivers, Liability, Notices, Construction, Severability, Amendments. The Notes contain customary representations, warranties, conditions and indemnification obligations of the parties. The representations, warranties and covenants contained in such agreements were made only for purposes of such agreements and as of specific dates, were solely for the benefit of the parties to such agreements and may be subject to limitations agreed upon by the contracting parties. |
| (i) | Successors and Assigns. The rights and obligations of the Company and the Purchasers are binding upon and benefit the successors, assigns, heirs, administrators and transferees of any party hereto (by operation of law or otherwise) with the prior written consent of the other party hereto and any attempted assignment without the required consent shall be void. |
| (j) | Transfer of Note or Issuable Securities. With respect to any sale or other disposition of the Notes, the Purchaser shall give written notice to the Company prior thereto, together with a written opinion, unless waived by the Company to the effect that such sale or other distribution may be effected without registration or qualification under any U.S. federal or state law then in effect. Upon receiving such written notice, the Company, as promptly as practicable, shall notify the Purchaser and the Purchaser may sell or otherwise dispose of their respective Note in accordance with the terms of the note delivered to the Company. |
The foregoing description of the Notes is not complete and is qualified in its entirety by reference to the form of the Note which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Business Loans and Lines of Credit
| 1. | On October 23, 2025, the Company entered into a funding agreement with Labrys Fund II, LP, an investment fund, pursuant to which we issued a convertible promissory note in the principal amount of $275,000 (the “October 23 Note”). The October 23 Note included a 10% original issue discount, resulting in net proceeds of $250,000, and carries a one-time interest charge of 10%. The October 23 Note matures 12 months from issuance and provides monthly amortization payments beginning 180 days after the issue date, with the right to prepay without penalty on the schedule set forth in the October 23 Note. After the 180-day period (or earlier upon an event of default), the holder may convert all or a portion of the outstanding balance into shares of our common stock at a conversion price equal to 75% of the lowest closing bid price during the 15 trading days immediately prior to the conversion date. In connection with the October 23 Note, we delivered irrevocable instructions to our transfer agent to reserve a sufficient number of shares of our common stock (initially 5,723,214 shares, subject to increase) to ensure that adequate shares are available for any future conversions under the October 23 Note. The proceeds are being used for working capital and general corporate purposes. The foregoing description of the October 23 Note is not complete and is qualified in its entirety by reference to the form of the Note which is filed as Exhibit 10.2 to this Current Report on Form 8-K and is incorporated herein by reference. |
| 2. | In October 2025, the Company entered into a new funding relationship with Vanquish Funding Group Inc. (“Vanquish”), a lender. On October 1, 2025, October 7, 2025, and November 28, 2025 the Company and Vanquish entered into Securities Purchase Agreements for the sale of bridge notes with the aggregate principal amount of $230,160,$160,160, and $230,160 respectively. In connection with the Securities Purchase Agreements, the Company issued (a) on October 1, 2025, a promissory note in the principal amount of $230,160 with an original issue discount of $24,660 and a one-time interest charge of 12%, maturing on July 30, 2026,(b) on October 7, 2025, a second promissory note in the principal amount of $160,160 with an original issue discount of $17,160, also carrying a 12% one-time interest charge and maturing on August 15, 2026 and (c) on November 28, 2025, a third promissory note in the principal amount of $230,160 with an original issue discount of $24,660 and a one-time interest charge of 12%, maturing on August 31, 2026. All three loans are unsecured and permit early repayment without penalty. The foregoing descriptions of the Securities Purchase Agreements and corresponding promissory notes are not complete and are qualified in their entirety by reference to the agreements which are filed as Exhibits 10.3,10.4, and 10.10 to this Current Report on Form 8-K and are incorporated herein by reference. |
| 3. | On October 23, 2025, Bourque Heating & Cooling Co., Inc. (“Borque”), a subsidiary of the Company entered into a Business Loan and Security Agreement with Finwise Bank, a lender, under which Bourque received total funding of $250,000, with 33% simple interest on the total funding amount. The agreement provides for 63 payments of $5,2777.80 due each business week until the total specified payback amount of $332,500 is satisfied. The funding is unsecured and does not carry traditional interest; instead, repayment is structured as a sale of a portion of future receivables at a discount. The proceeds from this financing are being used for working capital and general corporate purposes, including operating cash flow management and near-term growth initiatives. The foregoing description of the Business Loan and Security Agreement is not complete and is qualified in its entirety by reference to the agreement which is filed as Exhibit 10.5 to this Current Report on Form 8-K and is incorporated herein by reference. |
| 4. | On October 27, 2025, the Company entered into a Business Line of Credit Agreement with Blue Sky Electric, Inc., a lender, providing the Company with borrowing capacity of up to $43,100. As of date of this Report, the Company had drawn $42,000 under the line of credit. In accordance with the agreement, the outstanding balance will be repaid in 12 equal monthly installments. The foregoing description of the Business Line of Credit is not complete and is qualified in its entirety by reference to the agreement which is filed as Exhibit 10.6 to this Current Report on Form 8-K and is incorporated herein by reference. |
| 5. | On November 4, 2025, Bourque, entered into a Revenue Purchase Agreement with NewCo Capital Group VI, LLC, a lender, under which Bourque received funding of $140,000. The agreement provides for repayment through weekly remittances of $5,025, based on a fixed percentage (9%) of our receivables until the total specified payback amount of $201,000 is satisfied. The funding is unsecured and does not carry traditional interest; instead, repayment is structured as a sale of a portion of future receivables at a discount. The proceeds from these financings are being used for working capital and general corporate purposes, including operating cash flow management and near-term growth initiatives. The foregoing description of the Revenue Purchase Agreement is not complete and is qualified in its entirety by reference to the agreement which is filed as Exhibit 10.7 to this Current Report on Form 8-K and is incorporated herein by reference. |
| 6. | On November 7, 2025, Aurai LLC, a subsidiary of the Company, entered into an Agreement of Purchase and Sale of Future Receivable with Nebula Asset Holdings LLC, a lender, under which the Company received total funding of $60,000. The agreement provides for repayment through 20 weekly remittances of $5,400 based on a fixed percentage (15%) of our receivables until the total specified payback amount of $81,000 is satisfied. The funding is unsecured and does not carry traditional interest; instead, repayment is structured as a sale of a portion of future receivables at a discount. The proceeds from these financings are being used for working capital and general corporate purposes, including operating cash flow management and near-term growth initiatives. The foregoing description of the Agreement of Purchase and Sale of Future Receivable is not complete and is qualified in its entirety by reference to the agreement which is filed as Exhibit 10.8 to this Current Report on Form 8-K and is incorporated herein by reference. |
| 7. | On November 13, 2025, the Company entered into a Sale of Future Receipts Agreement with Ace Funding Source, a lender, under which the Company received total funding of $150,000. The agreement provides for repayment through weekly remittances (initially $7,000) based on a fixed percentage (7.47%) of our receivables until the total specified payback amount of $210,000 is satisfied. The funding is unsecured and does not carry traditional interest; instead, repayment is structured as a sale of a portion of future receivables at a discount. The proceeds from this financing are being used for working capital and general corporate purposes, including operating cash flow management and near-term growth initiatives. The foregoing description of the Business Line of Credit is not complete and is qualified in its entirety by reference to the agreement which is filed as Exhibit 10.9 to this Current Report on Form 8-K and is incorporated herein by reference. |
| 8. | On November 23, 2025, ConnectM Babione, LLC, a subsidiary of the Company, entered into a Term Loan Agreement with WebBank, a lender, pursuant to which ConnectM Babione received total funding of $175,000. The loan bears interest at a fixed rate of 17% per annum, has a 24-month term and provides for equal monthly payments of approximately $8,649.92 until maturity. The funding is unsecured, and the proceeds are being used for working capital and general corporate purposes, including operating cash flow management and near-term growth initiatives. The foregoing description of the Term Loan Agreement is not complete and is qualified in its entirety by reference to the agreement, which is filed as Exhibit 10.11 to this Current Report on Form 8-K and is incorporated herein by reference. |
Amperics Asset Purchase Agreement
On November 3, 2025, the Company entered into and closed on an Asset Purchase Agreement (the “Asset Purchase Agreement”) with Amperics Inc., a Delaware corporation (“Parent”), and Amperics Holdings LLC, a California limited liability company and wholly owned subsidiary of Parent (“Seller,” and together with Parent, the “Seller Parties”).
The Seller Parties are engaged in the business of nanotechnology-based energy storage solutions (the “Business”). Under the Asset Purchase Agreement, the Company agreed to acquire from Seller certain assets used in the Business (the “Assets”) and to assume certain specified liabilities of Seller related to the Business (the “Assumed Liabilities,” and together with the acquisition of the Assets, the “Transaction”).
At the closing of the Transaction (the “Closing”), as consideration for the Assets and the assumption of the Assumed Liabilities, the Company issued to Seller 2,700,000 shares of the Company’s common stock, par value $0.0001 per share (the “Payment Shares”). The Payment Shares were issued in book-entry form in the name of Seller. The Seller Parties received customary piggyback registration rights with respect to the Payment Shares.
The Assets acquired by the Company include, among other things, (i) rights under specified contracts related to the Business, (ii) specified intellectual property and proprietary information, (iii) copies of certain books and records relating to the Business, and (iv) the goodwill of the Business. The Company assumed only certain obligations of Seller under the assumed contracts and assigned intellectual property that arise and accrue after the Closing and do not relate to pre-Closing breaches or defaults. All remaining liabilities of the Seller Parties and the Business remain with the Seller Parties.
The Asset Purchase Agreement contains customary representations, warranties, covenants and indemnification provisions for a transaction of this type, including interim operating restrictions, efforts to obtain consents, and reciprocal indemnification provisions subject to customary survival periods, baskets and caps.
The foregoing summary of the Asset Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the Asset Purchase Agreement filed as Exhibit 2.1 to this Current Report on Form 8-K.
Geo Impex Exchange and Acquisition Agreement
On November 3, 2025, the Company entered into and consummated an Exchange and Acquisition Agreement (the Acquisition Agreement”) by and among the Company, ConnectM India Pvt Ltd., an Indian private limited company and wholly owned subsidiary of the Company (“ConnectM India” and, together with the Company, the “ConnectM Parties”), Geo Impex LLC, a Delaware limited liability company (“Geo Impex”), Global Impex LLC, a Delaware limited liability company (“Global Impex”), Geo Impex & Logistics Pvt Ltd., an Indian private limited company (“Geo Impex India”), and Marsh CDM Services Pvt Ltd., an Indian private limited company (“Marsh CDM” and, together with Geo Impex, Global Impex and Geo Impex India, the “Geo Impex Parties”).
Prior to entry into the Acquisition Agreement, Geo Impex owned 100% of the membership interests of Global Impex, and Global Impex owned 5,574,005 equity shares of Geo Impex India, representing approximately 48.01% of the equity interests of Geo Impex India. Marsh CDM, a wholly owned subsidiary of Geo Impex, owned 4,436,111 equity shares of Geo Impex India, representing approximately 38.21% of the equity interests of Geo Impex India.
At the Closing, (i) Geo Impex sold and transferred to the Company all of the issued and outstanding membership interests of Global Impex (the “Membership Interests”) and (ii) Marsh CDM sold and transferred to ConnectM India its 4,436,111 equity shares of Geo Impex India (the “Marsh CDM/Geo Impex India Shares”).
In consideration for the acquisition of the Membership Interests, the Company issued to Geo Impex 33,300,000 shares of the Company’s common stock (the “Exchange Shares”). In consideration for the acquisition of the Marsh CDM/Geo Impex India Shares, ConnectM India issued to Marsh CDM a promissory note of ConnectM India in the initial principal amount of INR 70,000,000 (approximately $788,900) (the “Note”). The Note is fixed-principal and does not include price-protection or similar variable features.
In connection with closing, the parties took required actions to reconstitute the board of Geo Impex India to consist of directors nominated by ConnectM India and to appoint related officers.
The Acquisition Agreement contains customary representations, warranties, and covenants, including interim operating restrictions, no-shop provisions, obligations to obtain required approvals and consents, and reciprocal indemnification provisions subject to negotiated survival, basket and cap limitations. Geo Impex represented that it is an accredited investor acquiring the Exchange Shares for investment purposes.
The foregoing summary of the Asset Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the Asset Purchase Agreement filed as Exhibit 2.3 to this Current Report on Form 8-K.
Item 2.01 Completion of Acquisition or Disposition of Assets
On November 3, 2025, the Company completed each of the transaction described under Item 1.01, which is incorporated herein by reference.
Pursuant to the Asset Purchase Agreement, the Company acquired the Assets and issued the Payment Shares to the Seller.
Pursuant to the Acquisition Agreement, the Company acquired all of the Membership Interests and ConnectM India acquired all of the March CDM/Geo Impex India Shares, issuing the consideration described above.
As a result of the Acquisition Agreement, Global Impex became a wholly owned subsidiary of the Company, and the Company, through Global Impex and Connect M India, indirectly and directly holds a majority of the outstanding equity of Geo Impex India.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth above in Item 1.01 of this Current Report on Form 8-K with respect to Notes is incorporated by reference
herein.
Item 3.02 Unregistered Sales of Equity Securities.
Convertible Shares
Following the issuance of the Notes, the Company issued an aggregate of 21,194,562 shares of common stock upon conversion of the Notes during the three months ended September 30, 2025, as follows (collectively, the “Conversions”):
| ● | 1,500,521 shares of common stock issued to GreenPicks Partners LLC on September 16, 2025; |
| ● | 2,991,157 shares of common stock issued to Win-Light Global Co. Ltd. on September 16, 2025; |
| ● | 1,775,342 shares of common stock issued to Ryan Fant on September 24, 2025; |
| ● | 365,068 shares of common stock issued to John C. Gillian on September 16, 2025; |
| ● | 710,137 shares of common stock issued to Christopher J. Joyce on September 16, 2025; |
| ● | 1,065,205 shares of common stock issued to Patrick J. McCarthy on September 16, 2025; |
| ● | 355,068 shares of common stock issued to Iffat Hussain on September 16, 2025; |
| ● | 7,101,370 shares of common stock issued to Corey T. Lee on September 16, 2025; |
| ● | 355,068 shares of common stock issued to Kedar Muley on September 16, 2025; |
| ● | 1,420,274 shares of common stock issued to Iffat Hussain on September 16, 2025; |
| ● | 1,777,676 shares of common stock issued to Arumilli LLC on September 16, 2025; and, |
| ● | 1,777,676 shares of common stock issued to Win-Light Global Co. Ltd. on September 16, 2025. |
The Company also issued an aggregate of 18,308,534 shares of common stock upon conversion of the Notes after the period ended September 30, 2025, as follows:
| ● | 710,137 shares of common stock issued to Software Ventures FZCO on October 22, 2025; |
| ● | 142,027 shares of common stock issued to Md Rabiul Hassan on October 22, 2025; |
| ● | 710,137 shares of common stock issued to Kaseeb Billah on October 22, 2025; |
| ● | 470,450 shares of common stock issued to Ashish Kulkarni on November 3, 2025; |
| ● | 470,450 shares of common stock issued to Umesh Goradia on November 3, 2025;3,035,008 shares of common stock issued to Umesh Goradia on November 25, 2025; |
| ● | 2,986,301 shares of common stock issued to Umesh Goradia on November 25, 2025; |
| ● | 1,178,691 shares of common stock issued to Ashish Kulkarni on November 25, 2025; |
| ● | 1,171,994 shares of common stock issued to Ashish Kulkarni on November 25, 2025; |
| ● | 2,096,438 shares of common stock issued to Maheshkumar Navani Revocable Trust on November 25, 2025; |
| ● | 2,893,455 shares of common stock issued to Adv Health Technologies Ltd. on November 25, 2025; |
| ● | 1,425,419 shares of common stock issued to Ashish Kulkarni on November 25, 2025; |
| ● | 170,219 shares of common stock issued to Md Rabiul Hassan on November 25, 2025; and |
| ● | 847,808 shares of common stock issued to Ashish Kulkarni on November 25, 2025. |
The common stock issued pursuant to the Conversions were issued without prior registration in reliance upon the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and Rule 506(d) of Regulation D thereunder. Each of the Purchasers represented to the Company that they are an “accredited investor” within the meaning of Rule 501(a) under the Securities Act.
Payment and Exchange Shares
The information set forth in Items 1.01 with respect to the issuance of the Payment Shares and the Exchange Shares is incorporated herein by reference.
On November 3, 2025, the Company issued:
| - | 2,700,000 Payment Shares to Seller in connection with the Asset Purchase Agreement; and |
| - | 33,300,000 Exchange Shares to Geo Impex in connection with the Acquisition Agreement. |
Each issuance was made in a private placement transaction exempt from registration under the Securities Act of 1933, as amended, in reliance on Section 4(a)(2) and Regulation D thereunder. Each recipient represented that it is an accredited investor acquiring the securities for investment purposes and not with a view to distribution. Appropriate restrictive legends and transfer limitations will be applied.
Issued and Outstanding Stock
Following the issuances noted in this Item 3.02, as of December 15, 2025, the Company had 151,812,318 shares of common stock issued and outstanding.
Item 9.01 Financial Statement and Exhibits.
(d) Exhibits.
SIGNATURES
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.
Dated: December 16, 2025
| ConnectM Technology Solutions, Inc. | ||
| By: | /s/ Bhaskar Panigrahi | |
| Name: | Bhaskar Panigrahi | |
| Title: | Chief Executive Officer | |
Exhibit 2.1
Asset Purchase Agreement
By and Among
ConnectM Technology Solutions, Inc.;
Amperics Inc.
and
Amperics Holdings LLC
TABLE OF CONTENTS
| Page | ||
| ARTICLE I. | Definitions and Interpretation | 1 |
| Section 1.01 | Definitions | 1 |
| Section 1.02 | Interpretation | 7 |
| ARTICLE II. | The Transactions | 7 |
| Section 2.01 | Purchase and Sale | 7 |
| Section 2.02 | Assets | 7 |
| Section 2.03 | Excluded Assets | 8 |
| Section 2.04 | Liabilities | 8 |
| Section 2.05 | Consideration | 9 |
| Section 2.06 | Closing | 9 |
| Section 2.07 | Required Vote | 10 |
| Section 2.08 | Closing Deliverables | 10 |
| ARTICLE III. | Conditions to the Closing | 11 |
| Section 3.01 | Condition to the Obligations of the Parties | 11 |
| Section 3.02 | Conditions to Obligations of the Seller Parties | 12 |
| Section 3.03 | Conditions to Obligations of ConnectM | 12 |
| ARTICLE IV. | Representations and Warranties of the Seller Parties | 13 |
| Section 4.01 | Organization and Power | 13 |
| Section 4.02 | Due Authorization; Enforceability | 13 |
| Section 4.03 | No Conflict; Consents | 14 |
| Section 4.04 | Accredited Investor | 14 |
| Section 4.05 | Compliance with Laws | 15 |
| Section 4.06 | Business; Title to and Sufficiency of the Assets | 16 |
| Section 4.07 | Litigation | 17 |
| Section 4.08 | Contracts | 17 |
| Section 4.09 | Intellectual Property | 17 |
| Section 4.10 | Related Party Transactions | 18 |
| Section 4.11 | Customer and Supplier Relations | 18 |
| Section 4.12 | Warranties | 18 |
| Section 4.13 | No Broker or Finder | 18 |
| ARTICLE V. | Representations and Warranties of ConnectM | 19 |
| Section 5.01 | Organization and Power of ConnectM | 19 |
| Section 5.02 | Due Authorization; Enforceability | 19 |
| Section 5.03 | No Conflict; Consents | 19 |
| Section 5.04 | No Broker or Finder | 19 |
| ARTICLE VI. | Registration Rights | 20 |
| Section 6.01 | Piggyback Registration Rights | 20 |
| Section 6.02 | Notification | 21 |
| Section 6.03 | Information | 21 |
| Section 6.04 | Fees and Expenses | 21 |
| i |
| ARTICLE VII. | Certain Covenants and Agreements | 22 |
| Section 7.01 | Records | 22 |
| Section 7.02 | Notices of Certain Events | 22 |
| Section 7.03 | Access to Information | 22 |
| Section 7.04 | Consents of Third Parties | 22 |
| Section 7.05 | Non-Assignable Contracts | 23 |
| Section 7.06 | Misdirected Payments | 23 |
| Section 7.07 | No-Shop | 23 |
| Section 7.08 | Affirmative Covenants | 24 |
| Section 7.09 | Negative Covenants | 25 |
| Section 7.10 | Effect of Knowledge on Indemnification | 26 |
| Section 7.11 | Further Assurances | 26 |
| Section 7.12 | Confidential Information | 26 |
| ARTICLE VIII. | Termination | 26 |
| Section 8.01 | Termination | 26 |
| Section 8.02 | Effect of Termination | 27 |
| Section 8.03 | Default by ConnectM | 27 |
| Section 8.04 | Default by Seller Parties | 27 |
| Section 8.05 | Expenses | 27 |
| ARTICLE IX. | Survival; Indemnification | 28 |
| Section 9.01 | Survival | 28 |
| Section 9.02 | Indemnification by the Seller Parties | 28 |
| Section 9.03 | Indemnification by ConnectM | 29 |
| Section 9.04 | Indemnification Procedures | 29 |
| Section 9.05 | Payments | 31 |
| Section 9.06 | Certain Limitations | 31 |
| Section 9.07 | Tax Treatment of Indemnification Payments | 31 |
| Section 9.08 | Effect of Investigation | 31 |
| Section 9.09 | Exclusive Remedy | 32 |
| ARTICLE X. | Miscellaneous | 32 |
| Section 10.01 | Notices | 32 |
| Section 10.02 | Governing Law | 33 |
| Section 10.03 | Jurisdiction | 33 |
| Section 10.04 | Waiver of Jury Trial | 33 |
| Section 10.05 | Specific Performance | 34 |
| Section 10.06 | Limitation on Damages | 34 |
| Section 10.07 | Attorneys’ Fees | 34 |
| Section 10.08 | Public Announcements and Filings | 34 |
| Section 10.09 | Third-Party Beneficiaries | 34 |
| Section 10.10 | Expenses | 34 |
| Section 10.11 | Entire Agreement | 34 |
| Section 10.12 | Construction | 35 |
| Section 10.13 | Amendment or Waiver | 35 |
| ii |
| Section 10.14 | Commercially Reasonable Efforts | 35 |
| Section 10.15 | Successors and Assigns | 35 |
| Section 10.16 | Counterparts | 36 |
Exhibits
| Exhibit A | Assets |
| Exhibit B | Bill of Sale and Assignment and Assumption Agreement |
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Asset Purchase Agreement
This Asset Purchase Agreement (this “Agreement”) is dated as of 3rd November, 2025 (the “Effective Date”), and is entered into by and among (a) ConnectM Technology Solutions, Inc., a Delaware corporation (“ConnectM”); (b) Amperics Inc., a Delaware corporation (“Parent”); and (c) Amperics Holdings LLC, a California limited liability company and a wholly owned subsidiary of Parent (the “Seller”). Each of Parent and Seller may be referred to herein collectively as the “Seller Parties” and each individually as a “Seller Party”. ConnectM, Parent and Seller may be referred to herein individually as a “Party” and collectively as the “Parties”.
BACKGROUND
WHEREAS, Parent and Seller are involved in the business of nanotechnology-based energy storage solutions (the “Business”);
WHEREAS, ConnectM desires to acquire from Seller certain assets of Seller, and to assume certain liabilities of Seller, in each case related to the Business, as further set forth herein, in exchange for the issuance to Seller of certain shares of common stock, par value $0.0001 per share, of ConnectM (the “Common Stock”);
NOW THEREFORE, in consideration of the foregoing and the representations, warranties, covenants, agreements and conditions contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound, the Parties hereto agree as follows:
ARTICLE I. Definitions and Interpretation
Section 1.01 Definitions. In addition to the other terms defined herein, the following terms shall have the following meanings:
| (a) | “Acquisition Inquiry” means an inquiry, indication of interest or request for nonpublic information that could reasonably be expected to lead to an Acquisition Proposal. |
| (b) | “Acquisition Transaction” means any transaction or series of related transactions with a Person or “group” (as defined in the Exchange Act and the rules promulgated thereunder) concerning any (i) merger, consolidation, business combination, share exchange, joint venture or similar transaction involving any Seller Party pursuant to which such Person or “group” would own 5% or more of the consolidated assets, revenues or net income of any Seller Party, (ii) sale, lease, license or other disposition directly or indirectly by merger, consolidation, business combination, share exchange, joint venture or otherwise, of assets of any Seller Party representing 5% or more of the consolidated assets, revenues or net income of any Seller Party, (iii) issuance or sale or other disposition (including by way of merger, consolidation, business combination, share exchange, joint venture or similar transaction) of any Equity Securities of any Seller Party, (iv) transaction or series of transactions in which any Person or “group” would acquire beneficial ownership or the right to acquire beneficial ownership of any Equity Securities of any Seller Party, including without limitation any of Transferred Shares, (v) action to make the provisions of any “fair price”, “moratorium”, “control share acquisition”, “business combination” or other similar anti-takeover statute or regulation inapplicable to any transaction, or (vi) any combination of any of the foregoing. |
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| (c) | “Action” means any action, suit, arbitration, proceeding or investigation by or before any court, any governmental or other regulatory or administrative agency or commission or any arbitration tribunal. |
| (d) | “Affiliate” of any specified Person means any other Person directly or indirectly Controlling or Controlled by or under direct or indirect common Control with such specified Person. |
| (e) | “Business Day” means any day except Saturday, Sunday or any day on which banks are generally not open for business in the State of Delaware. |
| (f) | “Code” means the United States Internal Revenue Code of 1986, as amended. |
| (g) | “Confidential Information” means any data or information of either Seller, Party, as it relates to the Business (including trade secrets), that is valuable to the operation of the Business and not generally known to the public or competitors. |
| (h) | “ConnectM Fundamental Representations” means the representations and warranties of ConnectM as set forth in Section 5.01 and Section 5.02. |
| (i) | “Contracts” means any written agreement, arrangement or legally enforceable commitment (including any purchase orders, statements of work, or other similar documents) to which the Seller is a party or is bound as of the Closing Date that is related to the Business. |
| (j) | “Control” means, when used with respect to any specified Person, the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise. |
| (k) | “Customer” means each customer from which Seller has received in the aggregate more than $10,000 during the 12-month period ended December 31, 2024. |
| (l) | “DGCL” means the Delaware General Corporation Law, as in place from time to time. |
| (m) | “Employee Benefit Plan” means with respect to any Person (i) each plan, fund, program, agreement, arrangement or scheme that is at any time sponsored or maintained or required to be sponsored or maintained by such Person or to which such Person makes or has made, or has or has had an obligation to make, contributions, or to which such Person has or may have any liability (fixed, contingent or otherwise), providing for employee benefits or for the remuneration, direct or indirect, of the employees, former employees, directors, officers, managers, consultants, independent contractors, contingent workers or leased employees of such Person or the dependents of any of them, including each deferred compensation, bonus, incentive compensation, pension, retirement, stock purchase, stock option and other equity-based compensation plan, or “welfare plan” (within the meaning of Section 3(1) of ERISA, determined without regard to whether such plan is subject to ERISA), (ii) each “pension plan” (within the meaning of Section 3(2) of ERISA, determined without regard to whether such plan is subject to ERISA), (iii) each severance, retention or change in control plan or agreement, each plan or agreement providing health, vacation, summer hours, supplemental unemployment benefit, hospitalization insurance, medical, dental, or legal benefit, and (iv) each other employee benefit plan, fund, program, agreement, arrangement or scheme, whether funded or unfunded, or whether written or oral. |
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| (n) | “Employment Agreement” means any employment contract, consulting agreement, termination or severance agreement, salary continuation agreement, change of control agreement, non-compete agreement or any other agreement respecting the terms and conditions of employment or payment of compensation, or of a consulting or independent contractor relationship in respect to any current or former officer, employee, consultant or independent contractor for which the Seller has any obligation. |
| (o) | “Equity Security” means, in respect of any Person, (a) any capital stock or similar security, (b) any security convertible into or exchangeable for any security described in clause (a), (c) any option, warrant, or other right to purchase or otherwise acquire any security described in clauses (a), (b), or (c), and, (d) any “equity security” within the meaning of the Exchange Act. |
| (p) | “ERISA Affiliate” means any Person (whether incorporated or unincorporated) that together with the Seller would be deemed a “single employer” under Section 4001 of ERISA or Section 414 of the Code. |
| (q) | “ERISA” means the United States Employee Retirement Income Security Act of 1974, as amended, and the rules and regulations promulgated thereunder. |
| (r) | “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder. |
| (s) | “GAAP” means generally accepted accounting principles in the United States, consistently applied. |
| (t) | “Governmental Entity” means any federal, state, local or foreign government, any political subdivision thereof, or any arbitrator, court, administrative or regulatory agency, department, instrumentality, body or commission or other governmental authority or agency, domestic or foreign. |
| (u) | “Indebtedness” means, without duplication, with respect to any Person, all obligations (including all obligations in respect of principal, accrued interest, penalties, breakage costs, fees and premiums) of such Person (a) for borrowed money; (b) evidenced by notes, bonds, debentures, factoring, hedging or swap arrangements or similar contracts or instruments; (c) for the deferred purchase price of assets, property, goods or services (other than trade payables, or accruals incurred in the Ordinary Course), including earn-out payments, and with respect to any conditional sale, title retention, consignment or similar arrangements; (d) under capital leases or leases that are or will be required to be capitalized in accordance with GAAP; (e) for any unpaid severance owed to former employees or any deferred compensation payments (including the employer portion of any employment or payroll taxes related thereto); (f) any accrued but unpaid Tax liability; (g) for deferred revenue; (h) for any customer deposits or credits; (i) by which such Person assured a creditor against loss, including letters of credit and bankers’ acceptances, in each case to the extent drawn upon or payable and not contingent; (j) secured by (or for which the holder of such indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on any property owned by such Person in the Ordinary Course; (k) for amounts payable with respect to accrued or unaccrued warranty claims; (l) for any accrued unpaid bonuses; and (m) in the nature of guarantees of the obligations described in clauses (a) through (l) above of any other Person. |
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| (v) | “Intellectual Property” means any or all of the following and all intellectual property and proprietary rights, registered or unregistered, arising out of or associated therewith: (i) all United States of America, international and foreign patents and applications therefor and all reissues, divisions, renewals, extensions, provisionals, continuations and continuations-in-part thereof; (ii) all inventions (whether patentable or not), invention disclosures, improvements, mask works, trade secrets, proprietary information, know-how, technology, technical data and customer lists, and all documentation relating to any of the foregoing throughout the world; (iii) all works of authorship (whether copyrightable or not), all copyrights, copyright registrations and applications therefor, and all other rights corresponding thereto throughout the world; (iv) all industrial designs and any registrations and applications therefor throughout the world, including the goodwill connected with the use of and symbolized by the foregoing; (v) all internet uniform resource locators, domain names, social media profiles and identifiers, web addresses and websites, trade names, logos, slogans, designs, trade dress, common law trademarks and service marks, trademark and service mark and trade dress registrations and applications therefor throughout the world; (vi) all computer software, databases and data collections and all rights therein throughout the world; (vii) all moral and economic rights of authors and inventors, however denominated, throughout the world; and (viii) any similar or equivalent rights to any of the foregoing anywhere in the world. |
| (w) | “Knowledge of the Seller” means the knowledge of any director or executive officer of any Seller Party, after reasonable inquiry and the exercise of reasonable diligence with respect to the matters at hand. |
| (x) | “Laws” mean all statutes, laws, rules, codes, regulations, rulings, restrictions, ordinances, orders, decrees, approvals, directives, judgments, injunctions, writs, awards and decrees of, or issued by, any Governmental Entity. |
| (y) | “Liens” mean all mortgages, liens, pledges, security interests, charges, claims, restrictions and encumbrances of any nature whatsoever. |
| (z) | “Material Adverse Effect” means any event, occurrence, fact, condition or change that is, or could reasonably be expected to become, individually or in the aggregate, materially adverse to (a) the business, results of operations, condition (financial or otherwise) or assets of the affected Party, or (b) the ability of the affected Party to consummate the Transactions on a timely basis; provided, however, that “Material Adverse Effect” shall not include any event, occurrence, fact, condition, or change, directly or indirectly, arising out of or attributable to: (i) any changes, conditions or effects in the United States economy or securities or financial markets in general; (ii) changes, conditions or effects that generally affect the industries in which the affected Party operates; (iii) any change, effect or circumstance resulting from an action required or permitted by this Agreement; or (iv) conditions caused by acts of terrorism or war (whether or not declared); provided further, however, that any event, occurrence, fact, condition, or change referred to in clauses (i), (ii) or (iv) immediately above shall be taken into account in determining whether a Material Adverse Effect has occurred to the extent that such event, occurrence, fact, condition, or change has a disproportionate effect on the affected Party compared to other participants in the industries in which the affected Party conducts its business. |
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| (aa) | “Non-Assignable Contracts” means a contract included in the Assumed Contracts that requires third party consents for assignment that has not been obtained by the Seller as of the Closing. |
| (bb) | “Order” means any decree, order, judgment, writ, award, injunction, rule or consent of or by a Governmental Entity. |
| (cc) | “Ordinary Course” means the ordinary course of business consistent with past practice of the Seller Parties with respect to the Business. |
| (dd) | “Organizational Documents” means, with respect to any Person, its certificate of incorporation or articles of incorporation, bylaws, memorandum and articles of association, operating agreement or similar organizational documents, in each case, as amended. |
| (ee) | “Permitted Liens” means (i) Liens for Taxes not yet due and payable, (ii) statutory Liens of landlords, and (iii) Liens of carriers, warehousemen, mechanics, materialmen and repairmen incurred in the Ordinary Course and not yet delinquent. |
| (ff) | “Person” means any individual, corporation, partnership, joint venture, limited liability company, trust, unincorporated organization or Governmental Entity. |
| (gg) | “Products” means any and all products developed, provided, marketed, or sold by the Seller in connection with the Business. |
| (hh) | “Release” means any actual release, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, abandonment, disposing or allowing to escape or migrate into or through the environment (including, without limitation, ambient air (indoor or outdoor), surface water, groundwater, land surface or subsurface strata or within any building, structure, facility or fixture). |
| (ii) | “Representatives” means, as to any Person, such Person’s Affiliates and the respective managers, directors, officers, employees, independent contractors, consultants, advisors (including financial advisors, counsel and accountants), agents and other legal representatives of such Person or its Affiliates. |
| (jj) | “SEC” means the United States Securities and Exchange Commission. |
| (kk) | “Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations thereunder. |
| (ll) | “Seller Benefit Plan” means each Employee Benefit Plan sponsored or maintained or required to be sponsored or maintained at any time by the Seller or Parent or to which the Seller or Parent makes or has made, or have or have had an obligation to make, contributions at any time with respect to any employee or other personnel of Seller or Parent. |
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| (mm) | “Seller Fundamental Representations” means the representations and warranties as set forth in Section 4.01, Section 4.02 and Section 4.04. |
| (nn) | “Seller Intellectual Property” means all Intellectual Property owned by or purportedly owned by or licensed to the Seller. |
| (oo) | “Seller Material Adverse Effect” means a Material Adverse Effect on Seller, or Parent, or a Material Adverse Effect on any of the Assets or on Assumed Liabilities. |
| (pp) | “Seller Transaction Expenses” means (i) the legal, accounting, financial advisory, and other advisory, transaction or consulting fees and expenses incurred by any Seller Party in connection with the Transactions and the planning, negotiation and documentation thereof; (ii) the aggregate amount payable (including “success fees” or bonuses, severance payments, and any amounts payable to offset any excise Taxes imposed under Section 4999 of the Code and any related income Taxes) by the Seller (A) to any third party as a result of the transactions contemplated by this Agreement or (B) to or for the benefit of current or former officers, directors or employees of the Seller, including (I) accrued and unpaid bonuses, (II) amounts payable (whether prior to, on or following the Closing Date) pursuant to any applicable agreement (whether written or oral) or other governing document or policy as a result of the transactions contemplated by this Agreement, and (III) employer-side payroll taxes; and (v) any transfer, sales, use, stamp, registration or other similar Taxes or recording fees payable as a result of the Transactions payable by the Seller Parties hereunder, in each case to the extent not paid prior to the Closing Date. |
| (qq) | “Services” means any and all services performed, provided, offered or marketed by the Seller in connection with the Business. |
| (rr) | “Software” means all computer software programs, together with any error corrections, updates, modifications, or enhancements thereto, in both machine-readable form and human-readable form, including all Application Program Interfaces, technical specifications, design requirements, user guides, operation manuals, comments and any procedural code. |
| (ss) | “Supplier” means each supplier that Seller has paid in the aggregate more than $10,000 during the 12-month period ended December 31, 2024. |
| (tt) | “Tax Authority” or “Tax Authorities” means the IRS and any Governmental Entity having jurisdiction over Taxes. |
| (uu) | “Taxes” means all taxes, assessments, charges, duties, fees, levies and other governmental charges (including interest, penalties or additions associated therewith), including income, franchise, capital stock, real property, personal property, tangible, withholding, employment, payroll, social security, social contribution, unemployment compensation, unclaimed property, escheat, disability, transfer, sales, use, excise, license, occupation, registration, stamp, premium, environmental, customs duties, alternative or add-on minimum, estimated, gross receipts, value-added and all other taxes of any kind imposed by any Governmental Entity. |
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| (vv) | “Transactions” means the transactions as contemplated by the Transaction Documents. |
| (ww) | “Transaction Documents” means this Agreement, the Bill of Sale, and any other agreement entered into by and between the Parties hereunder or with respect to the Transactions and the consummation thereof. |
| (xx) | “United States” means the United States of America. |
Section 1.02 Interpretation. Unless the express context otherwise requires (i) the words “hereof,” “herein,” and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provision of this Agreement; (ii) terms defined in the singular shall have a comparable meaning when used in the plural, and vice versa; (iii) the terms “Dollars” and “$” mean United States Dollars; (iv) references herein to a specific Section, Subsection, Recital or Exhibit shall refer, respectively, to Sections, Subsections, Recitals or Exhibits of this Agreement; (v) wherever the word “include,” “includes,” or “including” is used in this Agreement, it shall be deemed to be followed by the words “without limitation”; (vi) references herein to any gender shall include each other gender; (vii) references herein to any Person shall include such Person’s heirs, executors, personal Representatives, administrators, successors and assigns; provided, however, that nothing contained in this Section 1.02 is intended to authorize any assignment or transfer not otherwise permitted by this Agreement; (viii) references herein to a Person in a particular capacity or capacities shall exclude such Person in any other capacity; (ix) references herein to any Contract or agreement (including this Agreement) mean such Contract or agreement as amended, supplemented or modified from time to time in accordance with the terms thereof; (x) with respect to the determination of any period of time, the word “from” means “from and including” and the words “to” and “until” each means “to but excluding”; (xi) references herein to any Law or any license mean such Law or license as amended, modified, codified, reenacted, supplemented or superseded in whole or in part, and in effect from time to time; and (xii) references herein to any Law shall be deemed also to refer to all rules and regulations promulgated thereunder.
ARTICLE II. The Transactions.
Section 2.01 Purchase and Sale. Subject to the terms and conditions of this Agreement, on the Closing Date and as of the Closing Date, the Seller will grant, sell, assign, transfer, convey and deliver to ConnectM, and ConnectM will purchase and acquire from the Seller, free and clear of all Liens, other than Permitted Liens, all of the Seller’s right, title and interest in and to the Business and the Assets, and ConnectM will assume the Assumed Liabilities.
Section 2.02 Assets. The “Assets” means the following assets, properties and rights of the Seller, as further identified on Exhibit A attached hereto with respect to certain categories below, and other than the Excluded Assets:
| (a) | all rights under the Contracts set forth on Exhibit A (the “Assumed Contracts”); |
| (b) | the Seller Intellectual Property as set forth on Exhibit A (the “Assigned Intellectual Property”); |
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| (c) | copies of all information, files, correspondence, records, data, plans, reports, contracts, recorded knowledge, including customer, supplier, member, price and mailing lists, and all accounting or other books and records of the Seller in whatever media retained or stored, including computer programs and disks relating to the Business (collectively, “Purchased Records”); and |
| (d) | the goodwill of the Business. |
Section 2.03 Excluded Assets. Notwithstanding anything to the contrary set forth in this Agreement, the Assets will not include the following assets properties and rights of the Seller or Parent (collectively, the “Excluded Assets”): (a) cash, cash equivalents and marketable securities; (b) Organizational Documents or minute and equity record books of any Seller Party; (c) income tax returns and reports of any Seller Party; (d) corporate seals, checkbooks and cancelled checks of any Seller Party; (e) all rights, claims and causes of action relating to any Excluded Asset or Excluded Liability; (f) all equity interests of any Seller Party and any of their respective Affiliates; (g) all refunds of any Tax that is an Excluded Liability; (h) all written communications, including emails, relating to the Excluded Assets, Excluded Liabilities and negotiations related to the Transactions; (i) all Seller Benefit Plans and all Employment Agreements held by the Seller or Parent; (j) all rights of the Seller Parties under this Agreement, and all other Transaction Documents; (k) all insurance policies of the Seller Parties and all rights, claims or causes of action of the Seller and/or Parent arising under such insurance policies; and (l) all rights of the Seller and/or Parent under contracts or agreements that are not Assumed Contracts.
Section 2.04 Liabilities.
| (a) | Assumed Liabilities. On the terms and subject to the conditions of the Agreement, as of the Closing Date, ConnectM will assume only the Assumed Liabilities, to the extent not satisfied or extinguished as of the Closing Date. The “Assumed Liabilities” means, subject to Section 2.04(b), only (i) the obligations of the Seller under the Assumed Contracts to the extent arising and accruing from and after the Closing Date and not relating to a breach or default by the Seller or Parent or a failure to perform timely, in each case, prior to the Closing Date; and (ii) the obligations of the Seller with respect to the Assigned Intellectual Property to the extent arising and accruing from and after the Closing Date. |
| (b) | Excluded Liabilities. Except for the Assumed Liabilities, it is expressly understood and agreed that ConnectM will not assume, and will not be liable for, any liabilities or obligations of either Seller Party or the Business as set forth below in the definition of “Excluded Liabilities”, and, as between Purchase on the one hand, and the Seller Parties, on the other hand, the Seller Parties will retain responsibility for all Excluded Liabilities. For purposes herein, “Excluded Liabilities” means (i) any and all liabilities and obligations arising from or relating to the Business or the Assets prior to the Closing Date; (ii) the obligations of the Seller Parties under the Assumed Contracts to the extent arising and accruing prior to the Closing Date and relating to a breach or default by any Seller Party or a failure to perform timely, in each case, prior to the Closing Date; (iii) the obligations of the Seller Parties with respect to the Assigned Intellectual Property to the extent arising and accruing prior to the Closing Date; (iv) any and all liabilities and obligations for Taxes, including relating to (A) any liability or obligation for the unpaid Taxes of either Seller Party with respect to any period, or (B) any Taxes arising out of or relating to events which have occurred, or Services or Products, or the operation of either Seller Party or the Business or the ownership of the Assets prior to the Closing Date; (v) any Indebtedness of either Seller Party; (vi) any and all liabilities or obligations pertaining to an Excluded Asset; (vii) any and all liabilities or obligations arising under or relating to any former operations of either Seller Party or predecessor entities thereof that have been discontinued or disposed of prior to the Closing Date; (viii) any and all liabilities or obligations arising under or relating to any Seller Benefit Plan, (B) any Employee Benefit Plan pursuant to any applicable Law that imposes liability on a “controlled group” or similar basis (within the meaning of Section 4001 or ERISA or Section 414 of the Code), as a result of either Seller Party, or any of their Affiliates, being an ERISA Affiliate prior to the Closing Date with respect to any other Person, or (C) any Employment Agreements held by either Seller Party; (ix) any and all liabilities or obligations for accrued vacation and other paid personal leave time arising and accruing prior to the Closing Date; (x) any and all liabilities or obligations arising out of or relating to (A) claims made in pending or future suits, actions, investigations, or other legal, governmental or administrative proceedings or (B) claims based on violations of Law, breach of contract, employment practices, or environmental, health and safety matters, or any other actual or alleged failure of either Seller Party to perform any obligation, in each case arising out of, or relating to, (I) events that have occurred, (II) Services or Products or (III) the operation of either Seller Party or the Business, in each case, prior to the Closing Date; (xii) any Seller Transaction Expenses; (xii) any and all liabilities or obligations relating to any non-compliance by either Seller Party with any bulk-sales laws; and (xii) any and all liabilities or obligations arising out of claims, actions, litigation, or proceedings arising out of or relating to any of the foregoing, and all costs and expenses in connection therewith. |
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Section 2.05 Consideration.
| (a) | The consideration for the acquisition of the Assets and the assumption of the Assumed Liabilities shall be the issuance to Seller of, subject to the provisions of Section 2.05(b), 2,700,000 shares of Common Stock (the “Payment Shares”). |
| (b) | The number of Payment Shares to be issued to Seller at the Closing as set forth in Section 2.05(a) shall be equitably adjusted for any forward stock split or reverse stock split of the Common Stock occurring following the Effective Date and prior to the Closing. By way of example and not limitation in the event that following the Effective Date and prior to the Closing, ConnectM undertakes a 2-for-1 forward split of the Common Stock, wherein each share of Common Stock is split into two shares of Common Stock, the number of Payment Shares as set forth in Section 2.05(a) shall be increased by 100%, and in the event that following the Effective Date and prior to the Closing ConnectM undertakes a 1-for-2 reverse split of the Common Stock, wherein each two shares of Common Stock are combined into one share of Common Stock, the number of Payment Shares as set forth in Section 2.05(a) shall be reduced by 50%. The adjustments as set forth in this Section 2.05(a) shall be undertaken each time that a transaction as set forth in this Section 2.05(a) is consummated following the Effective Date and prior to the Closing. |
Section 2.06 Closing. The closing of the Transactions (the “Closing”) will occur on the second Business Day following the satisfaction, or waiver by the Party for whom such condition to Closing exists, of the conditions to the Closing as set forth in Article III, or such other date as may be agreed to by the Parties, each in their sole discretion (the “Closing Date”).
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Section 2.07 Required Vote. As promptly as practicable after the Effective Date, Seller and Parent shall prepare such documents as required to obtain the approval and adoption of this Agreement, the Transaction Documents and the Transactions by the Parent as the sole member of the Seller, and by the stockholders of Parent in accordance with Parent’s Organizational Documents and applicable Law (collectively, the “Required Approvals”).
Section 2.08 Closing Deliverables.
| (a) | At the Closing, ConnectM shall: |
| (i) | Record the Seller in the books and records of ConnectM as the beneficial owner of the Payment Shares (which Payment Shares shall be recorded in book entry form and shall not be certificated); |
| (ii) | Deliver to Seller a copy of the Bill of Sale and Assignment and Assumption Agreement, in the form as attached hereto as Exhibit B (the “Bill of Sale”) duly executed by an authorized officer of ConnectM; |
| (iii) | Deliver to the Seller Parties a certificate of a duly authorized officer of ConnectM dated as of the Closing Date, in form and substance reasonably satisfactory to the Seller Parties (A) certifying the name, title and true signature of each officer of each ConnectM executing or authorized to execute any Transaction Documents, and such other documents, instruments and certifications required or contemplated hereby or thereby, (B) attaching a certificate of good standing and legal existence of ConnectM issued by the Secretary of State of the State of Delaware and dated as of a date no earlier than three Business Days prior to the Closing Date; and (C) certifying that the matters set forth in Section 3.02(a) and Section 3.02(b) are true and correct; and |
| (iv) | Deliver to the Seller Parties such other documents as the Seller Parties may reasonably request for the purpose of evidencing the accuracy of ConnectM’s representations and warranties; evidencing the performance by ConnectM of, or the compliance by ConnectM with, any covenant or obligation required to be performed or complied with by ConnectM; or otherwise facilitating the consummation or performance of any of the Transactions. |
| (b) | At the Closing, the Seller Parties shall deliver to ConnectM: |
| (i) | A copy of the Bill of Sale, duly executed by an authorized officer of the Seller, and such other deeds of conveyance, assurances, transfers, assignments instruments as may be reasonably required by ConnectM to complete the Transactions; |
| (ii) | a non-foreign affidavit duly executed by the Seller sufficient to satisfy the requirements for establishing an exemption from withholding under Section 1445 of the Code, and any other similar federal, state or local taxation requirements, to the extent applicable; |
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| (iii) | a certificate of a duly authorized officer of each Seller Party dated as of the Closing Date, in form and substance satisfactory to ConnectM (A) certifying the name, title and true signature of each officer of each Seller Party executing or authorized to execute any Transaction Document, and such other documents, instruments and certifications required or contemplated hereby or thereby, (B) attaching and a certificate of good standing and legal existence of each Seller Party issued by the applicable Governmental Authority, and each and dated as of a date no earlier than three Business Days prior to the Closing Date; (C) certifying that the matters set forth in Section 3.03(a), Section 3.03(b) and Section 3.03(c) are true and correct; and (D) providing reasonable evidence of receipt of the Required Approvals; and |
| (iv) | such other documents as ConnectM may reasonably request for the purpose of evidencing the accuracy of the Seller Parties’ representations and warranties; evidencing the performance by the Seller Parties of, or the compliance by the Seller Parties with, any covenant or obligation required to be performed or complied with by any of the Seller Parties; or otherwise facilitating the consummation or performance of any of the Transactions. |
| (c) | At and following the Closing, each of the Parties shall execute, acknowledge, and deliver (or shall ensure to be executed, acknowledged, and delivered), any and all certificates, financial statements, schedules, agreements, resolutions, rulings or other instruments required by this Agreement to be so delivered at or prior to the Closing, together with such other items as may be reasonably requested by the Parties hereto and their respective legal counsel in order to effectuate or evidence Transactions. |
ARTICLE III. Conditions to the Closing
Section 3.01 Condition to the Obligations of the Parties. The obligations of all of the Parties to consummate the Closing are subject to the satisfaction of all the following conditions on or before the Outside Closing Date (as defined below):
| (a) | No Governmental Entity shall have enacted, issued, promulgated, enforced or entered any Law (whether temporary, preliminary or permanent) or Order that is then in effect and which has the effect of making the transactions or agreements contemplated by this Agreement illegal or which otherwise prevents or prohibits consummation of the transactions contemplated by this Agreement and no Governmental Entity shall have imposed any terms or conditions on the transactions contemplated herein which would reasonably be expected to materially impact the operations of the Parties following the Closing. |
| (b) | There shall not be any Action brought by a third party that is not an Affiliate of the Parties to enjoin or otherwise restrict the consummation of the Closing. |
| (c) | The Required Approvals shall have been received. |
| (d) | All consents required to be obtained from or made with any Governmental Entity in order to consummate the Transactions shall have been obtained or made. |
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Section 3.02 Conditions to Obligations of the Seller Parties. The obligations of the Seller Parties to consummate the Closing is subject to the satisfaction, or the waiver at each such Party’s sole and absolute discretion, of all the following further conditions:
| (a) | ConnectM shall have duly performed all of its obligations hereunder required to be performed by it at or prior to the Closing Date (as defined below) in all material respects, unless the applicable obligation has a materiality qualifier in which case it shall be duly performed in all respects. |
| (b) | All of the representations and warranties of ConnectM contained in Article V which are not qualified by materiality shall be true and correct in all material respects on and as of the Effective Date and on and as of the Closing Date as if made on the Closing Date, and those representations and warranties of ConnectM contained in Article V which are qualified by materiality, and the ConnectM Fundamental Representations, shall be true and correct in all respects on and as of the Effective Date and on and as of the Closing Date as if made on the Closing Date, except for (i) those representations and warranties other than the ConnectM Fundamental Representations that address matters only as of a particular date, which representations and warranties shall have been true and correct in all material respects, or in all respects, as applicable, and (ii) other than with respect to the ConnectM Fundamental Representations, any failures to be true and correct that (without giving effect to any qualifications or limitations as to materiality), individually or in the aggregate, have not had and would not reasonably be expected to have a Material Adverse Effect on ConnectM. |
| (c) | The Seller Parties shall not have terminated this Agreement pursuant to the provisions of Section 8.01. |
Section 3.03 Conditions to Obligations of ConnectM. The obligations of ConnectM to consummate the Closing is subject to the satisfaction, or the waiver at ConnectM’s sole discretion, of all of the following further conditions:
| (a) | Each of the Seller Parties shall have duly performed all of its obligations hereunder required to be performed by it at or prior to the Closing Date in all material respects, unless the applicable obligation has a materiality qualifier in which case it shall be duly performed in all respects. |
| (b) | All of the representations and warranties of each of the Seller Parties contained in Article IV which are not qualified by materiality or Seller Material Adverse Effect shall be true and correct in all material respects on and as of the Effective Date and on and as of the Closing Date as if made on the Closing Date, those representations and warranties of the Seller Parties contained in Article IV which are qualified by materiality or Seller Material Adverse Effect, and the Seller Fundamental Representations, shall be true and correct in all respects on and as of the Effective Date and on and as of the Closing Date as if made on the Closing Date, except for (i) those representations and warranties other than the Seller Fundamental Representations that address matters only as of a particular date, which representations and warranties shall have been true and correct in all material respects, or in all respects, as applicable, and (ii) other than with respect to the Seller Fundamental Representations, any failures to be true and correct that (without giving effect to any qualifications or limitations as to materiality or Seller Material Adverse Effect), individually or in the aggregate, have not had and would not reasonably be expected to have a Seller Material Adverse Effect. |
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| (c) | No Seller Material Adverse Effect shall have occurred between the Effective Date and the Closing Date. |
| (d) | If determined to be required by the Board of Directors of ConnectM in its sole discretion, the consent of the stockholders of ConnectM for this Agreement and the consummation of the Transactions shall have been obtained and shall be remaining in full force and effect. |
ARTICLE IV. Representations and Warranties of the Seller Parties
In order to induce ConnectM to enter into this Agreement and consummate the Transactions, the Seller Parties, jointly and severally, and except as set forth in the Seller Disclosure Schedules as delivered by the Seller Parties to ConnectM on the Effective Date (the “Disclosure Schedules”), represent and warrant to ConnectM as follows:
Section 4.01 Organization and Power.
| (a) | The Seller is a limited liability company, validly existing and in good standing under the laws of the State of California. The Seller has all necessary power and authority to own, lease and operate its properties and conduct the Business as it is presently being conducted, to execute and deliver this Agreement and the other Transaction Documents to which the Seller is or will be a party and to consummate the Transactions and to perform each of its obligations under the Transaction Documents. The Seller has heretofore made available to ConnectM correct and complete copies of its Organizational Documents as currently in effect. Section 4.01(a) of the Disclosure Schedules sets forth each jurisdiction where the Seller is qualified or registered as a foreign company to transact business. The Seller is duly qualified or registered as a foreign company to transact business under the Laws of each jurisdiction where the character of its activities or the location of the properties owned or leased by it requires such qualification or registration, except where the failure of such qualification or registration would not reasonably be expected to be material to the Business. |
| (b) | The Parent is a corporation validly existing and in good standing under the laws of the State of Delaware. The Parent has all necessary power and authority to own, lease and operate its properties and conduct its business as it is presently being conducted, to execute and deliver this Agreement and the other Transaction Documents to which the Parent is or will be a party and to consummate the Transactions and to perform each of its obligations under the Transaction Documents. The Parent is duly qualified or registered as a foreign company to transact business under the Laws of each jurisdiction where the character of its activities or the location of the properties owned or leased by it requires such qualification or registration, except where the failure of such qualification or registration would not reasonably be expected to be material to the operations of the Parent. Parent is the sole member of the Seller. |
Section 4.02 Due Authorization; Enforceability. The execution and delivery of this Agreement and each of the Transaction Documents by each of the Seller Parties and the performance by t each of the Seller Parties of the obligations hereunder and thereunder and the consummation of the Transactions have been duly and validly authorized by all necessary action of each Seller Party, subject to receipt of the Required Approvals. This Agreement and each of the Transaction Documents to which either Seller Party is a party constitutes, or will constitute, when executed and delivered, a valid and binding agreement of the such Seller Party, enforceable against such Seller Party in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and other laws relating to or affecting the enforcement of creditors’ rights and remedies generally and the availability of specific performance or other equitable remedies.
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Section 4.03 No Conflict; Consents. Neither the execution and delivery of this Agreement nor the consummation of the Transactions will (a) conflict with or result in any breach of any provision of the organizational documents of either Seller Party, (b) require any filing with, or the obtaining of any permit, authorization, consent or approval of, any Governmental Entity, (c) violate or conflict with, constitute a breach of or result in a default under, or give rise to any right of termination, cancellation, acceleration or loss of benefit under, any of the terms, conditions or provisions of any Assumed Contract or (d) violate in any respect any Law, order, injunction or decree applicable to either Seller Party or any Assets.
Section 4.04 Accredited Investor.
| (a) | Seller is acquiring the Payment Shares at the Closing for investment for Seller’s own account and not as a nominee or agent. |
| (b) | Seller represents and warrants that Seller (i) can bear the economic risk of Seller’s investment in the Payment Shares, and (ii) possesses such knowledge and experience in financial and business matters that Seller is capable of evaluating the merits and risks of the investment in ConnectM and Payment Shares. |
| (c) | Seller represents that it is an “accredited investor” (an “Accredited Investor”) as that term is defined in Rule 501 of Regulation D (“Regulation D”) promulgated by the SEC under Section 4(a)(2) of the Securities Act, and that Seller understands and acknowledges that ConnectM is relying upon such representation to qualify for the exemption from the registration requirements of the Securities Act pursuant to Rule 506 of Regulation D, and that any certificate representing the Payment Shares shall be endorsed with the following legends, in addition to any other legend required to be placed thereon by applicable federal or state securities Laws: |
“THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE 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 (TOGETHER WITH THE RULES AND REGULATIONS THEREUNDER, 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.”
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| (d) | Seller acknowledges that neither the SEC nor the securities regulatory body of any other jurisdiction, has received, considered or passed upon the accuracy or adequacy of the information and representations made in this Agreement. |
| (e) | Seller acknowledges that it has carefully reviewed such information as Seller has deemed necessary to evaluate an investment in ConnectM and the Payment Shares. Seller acknowledges that Seller has been furnished all materials that it has requested relating to ConnectM and the issuance of the Payment Shares hereunder, and that Seller has been afforded the opportunity to ask questions of ConnectM’s representatives to obtain any information necessary to verify the accuracy of any representations or information made or given to Seller. |
| (f) | Seller understands that the Payment Shares may not be sold, transferred, or otherwise disposed of without registration under the Securities Act or an exemption therefrom, and that in the absence of an effective registration statement covering the Payment Shares or any available exemption from registration under the Securities Act, the Payment Shares may have to be held indefinitely. Seller understands that (i) the sale or re-sale of the Payment Shares has not been and is not being registered under the Securities Act or any applicable state securities Laws, and the Payment Shares may not be transferred unless (a) the Payment Shares are sold pursuant to an effective registration statement under the Securities Act, (b) Seller shall have delivered to ConnectM, at the cost of Seller, an opinion of counsel that shall be in form, substance and scope customary for opinions of counsel in comparable transactions to the effect that the Payment Shares to be sold or transferred may be sold or transferred pursuant to an exemption from such registration, which opinion shall be accepted by ConnectM, (c) the Payment Shares are sold or transferred to an Affiliate of Seller who agree to sell or otherwise transfer the Payment Shares only in accordance with this Section 4.04 and who is an Accredited Investor, (d) the Payment Shares are sold pursuant to Rule 144 promulgated under the Securities Act (“Rule 144”)), or (e) the Payment Shares are sold pursuant to Regulation S under the Securities Act (or a successor rule) (“Regulation S”), and Seller shall have delivered to ConnectM, at the cost of Seller, an opinion of counsel that shall be in form, substance and scope customary for opinions of counsel in corporate transactions, which opinion shall be accepted by ConnectM; and (ii) any sale of such Payment Shares made in reliance on Rule 144 may be made only in accordance with the terms of said Rule and further, if said Rule is not applicable, any re-sale of such Payment Shares under circumstances in which the seller (or the Person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the Securities Act) may require compliance with some other exemption under the Securities Act or the rules and regulations of the SEC thereunder. |
| (g) | Seller agrees that, notwithstanding anything contained herein to the contrary, the warranties, representations, agreements and covenants of Seller under this Section 4.04 shall survive the Closing for the period set forth in Section 9.01. |
Section 4.05 Compliance with Laws.
| (a) | The Seller is (and has been at all times during the past five (5) years) in compliance with all applicable Laws in all material respects. The Seller has not been charged with and has not received any notice of being in violation of, or is not, to the Knowledge of the Seller, under any investigation with respect to, any applicable Law, agency agreement, penalty or fine entered by any Governmental Entity relating to the operations of the Business or to any of the Assets. |
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| (b) | The Seller is not currently a party or subject to any Contract with any Governmental Entity. The Seller is not debarred or suspended from doing business with any Governmental Entity. |
| (c) | No Product or Service provided by the Seller has been, directly or indirectly, sold to or performed on behalf of any Person in the Crimea Region of Ukraine, the so-called Donetsk People’s Republic, the so-called Luhansk People’s Republic, Cuba, Iran, North Korea, Syria, Kherson and Zaporizhzhia or any covered region of Ukraine identified pursuant to Executive Order 14065 or any other country against which the United States maintains economic sanctions or an arms embargo. |
| (d) | The Seller is in compliance, and has complied, with applicable anti-corruption Laws, including the U.S. Foreign Corrupt Practices Act and similar Laws of those countries in which the Seller conducts business in all material respects, and, to the Knowledge of the Seller, there are no unresolved investigations or claims concerning any liability of the Seller with respect to such Laws. The Seller is in compliance, and has complied, with the applicable provisions of the U.S. Bank Secrecy Act and USA PATRIOT Act of 2001, as amended, and other applicable foreign Laws relating to anti-money laundering and similar matters in all material respects. |
| (e) | The Seller is (and has been at all times during the past five (5) years) in compliance with all economic sanctions and anti-boycott Laws in all material respects, including the Laws and regulations administered by the U.S. Customs and Border Protection and U.S. Customs and Immigration Service, the Arms Export Control Act and the International Traffic in Arms Regulations, the Export Control Reform Act and the Export Administration Regulations, the Laws and regulations administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control, and Section 999 of the Internal Revenue Code. |
Section 4.06 Business; Title to and Sufficiency of the Assets.
| (a) | The Seller has, and is transferring to ConnectM good, valid and marketable title to the Assets, free and clear of all Liens (other than Permitted Liens) as of the Closing. There are no outstanding rights, options, agreements or commitments giving any Person any right to require the Seller to sell, lease or otherwise dispose of any of the Assets. |
| (b) | The Assets (i) constitute all of the assets, tangible and intangible, of any nature whatsoever, necessary and sufficient to operate the Business in the manner presently operated by the Seller, and (ii) include all of the operating assets of the Business. No part of the Business is operated through any entity other than the Seller. The Assets are adequate for the purposes for which such assets are currently used or are held for use, conform in all material respects to all Laws applicable thereto, and with respect to the tangible Assets, are in good repair and operating condition (subject to normal wear and tear). There are no facts or conditions affecting the Assets which could, individually or in the aggregate, interfere with the use or operation thereof as currently used or operated, or their adequacy for such use. |
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| (c) | No Person other than the Seller owns any equipment or other tangible personal property or assets situated on the premises of the Business, except for the leased items that are subject to personal property leases that are included in the Assets. |
Section 4.07 Litigation. There are no (and in the past five (5) years there has not been any) claims, actions, suits, proceedings or investigations pending or, to the Knowledge of the Seller, threatened before any Governmental Entity, brought by or against the Seller or any of its officers, directors, employees, agents or Affiliates involving, affecting or relating to the Assets, the Business, or the Transactions, nor, to Knowledge of the Seller, does there exist any fact which might reasonably be expected to give rise to any such suit, proceeding, dispute or investigation. None of the items set forth in Section 4.07 of the Disclosure Schedules, if any, finally determined adversely, is reasonably likely, individually or in the aggregate, to have a material effect upon the Business. Neither the Seller nor any of the Assets are subject to any order, writ, judgment, award, injunction or decree of any Governmental Entity or arbitrator.
Section 4.08 Contracts
| (a) | Correct and complete copies of all Assumed Contracts have been made available to ConnectM by the Seller. |
| (b) | All of the Assumed Contracts are in full force and effect and are legal, valid, binding and enforceable against the parties thereto in accordance with their terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and other laws relating to or affecting the enforcement of creditors’ rights and remedies generally and the availability of specific performance or other equitable remedies. No breach, default or event of breach or default by the Seller, or, to the Knowledge of the Seller, any other party thereto, exists under any of the Assumed Contracts and, to the Knowledge of the Seller, no event has occurred or circumstance exists which, with the delivery of notice, the passage of time or both, would constitute a breach or default under an Assumed Contract on the part of the Seller, nor, to the Knowledge of the Seller, on the part of the other party thereto. The Seller is not participating in any discussions or negotiations regarding modification of or amendment to any Assumed Contract. |
Section 4.09 Intellectual Property.
| (a) | (i) The Seller owns and possesses all right, title and interest in the Assigned Intellectual Property, free and clear of all Liens (other than Permitted Liens); (ii) there are no judgments, consents, settlements, decrees, orders, injunctions, or rulings impairing the validity, use, ownership, or enforceability of any of the Assigned Intellectual Property, or finding any of the Assigned Intellectual Property to be invalid or unenforceable; (iii) there are no proceedings pending or, to the Knowledge of the Seller, threatened, that challenge or impair the validity, use, ownership, or enforceability of the Assigned Intellectual Property; and (iv) the maintenance fees necessary to maintain the Assigned Intellectual Property through the Effective Date have been paid, and through the Closing Date will have been paid. |
| (b) | (i) Neither the use of the Assigned Intellectual Property as currently used by the Seller infringes, misappropriates or violates the rights of any Person in any Assigned Intellectual Property, (ii) the Seller has not received any written notice in the past five (5) years alleging any of the same, and (iii) to the Knowledge of the Seller no actions or claims are threatened against the Seller alleging any of the same. |
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| (c) | (i) There are no claims, proceedings, actions, suits, hearings, arbitrations, to the Knowledge of the Seller, investigations, charges, complaints, demands or similar actions currently pending or, to the Knowledge of the Seller, threatened, or that have been brought in the past five (5) years, by the Seller against any Person alleging infringement, misappropriation, or violation of any Assigned Intellectual Property; and (ii) to the Knowledge of the Seller, no Person is currently infringing upon, misappropriating, or otherwise violating any of the Assigned Intellectual Property. |
| (d) | The Assigned Intellectual Property includes all of the Intellectual Property used in the conduct of the Business, and there are no other items of Intellectual Property that are material to the Business. |
Section 4.10 Related Party Transactions. Other than as set forth herein, (a) no employee or Parent, (b) no Person with whom any such employee or Parent has any direct or indirect relation by blood, marriage or adoption or owns any beneficial interest, or (c) any Affiliate of any of the foregoing or any current or former Affiliate of the Seller has any interest in: (i) any contract, arrangement or understanding with, or relating to, the Seller, the Business, the Assets or the Assumed Liabilities, (ii) any loan, arrangement, understanding, agreement or contract for or relating to the Seller, the Business or the Assets or (iii) any property (real, personal or mixed), tangible or intangible, used or currently intended to be used by the Seller in the Business.
Section 4.11 Customer and Supplier Relations. Section 4.11 of the Disclosure Schedules contains a correct and complete list of the names and addresses of the Customers and Suppliers, and the amount of sales to each Customer or purchases from each such Supplier during the twelve (12) month period ended as of December 31, 2024. The Seller maintains good relations with each of its Customers and Suppliers and, to the Knowledge of the Seller, no event has occurred that could materially and adversely affect the Business’ relations with any Customer or Supplier. No Customer or Supplier has during the last twelve (12) months cancelled, terminated or, to the Knowledge of the Seller, made any threat to cancel or otherwise terminate any of its contracts with the Seller, to increase or decrease its usage or supply of the Business’ Services or Products, or to otherwise make any changes to the terms of its Contracts with the Seller that could be adverse to the Business. The Seller has no Knowledge to the effect that any current Customer or Supplier may terminate or materially alter its business relations with the Business, either as a result of the Transactions or otherwise.
Section 4.12 Warranties. The Seller does not make any express warranty or guaranty as to Products or Services (a “Warranty”), and there is no pending or, to the Knowledge of the Seller, threatened claim alleging any breach of any Warranty. The Seller has no exposure to, or liability under, any Warranty (a) beyond that which is typically assumed in the ordinary course of business by Persons engaged in businesses comparable in size and scope of the Seller, or (b) that would be material to the Business.
Section 4.13 No Broker or Finder. No Seller Party has engaged, and shall not have any liability for, any investment banker, finder, broker or sales agent or any other Person in connection with the origin, negotiation, execution, delivery or performance of any Transaction Document to which it is a party, or the Transactions.
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ARTICLE V. Representations and Warranties of ConnectM
In order to induce the Seller Parties to enter into this Agreement and consummate the Transactions, ConnectM represents and warrants to the Seller Parties as follows:
Section 5.01 Organization and Power of ConnectM. ConnectM is a corporation validly existing and in good standing under the laws of the State of Delaware. ConnectM has all necessary power and authority to own, lease and operate its properties and conduct its business as it is presently being conducted, to execute and deliver this Agreement and the other Transaction Documents to which ConnectM is or will be a party and to consummate the Transactions and to perform each of its obligations under the Transaction Documents. The Organizational Documents of ConnectM are including in the filings made by ConnectM with the SEC. ConnectM is duly qualified or registered as a foreign company to transact business under the Laws of each jurisdiction where the character of its activities or the location of the properties owned or leased by it requires such qualification or registration, except where the failure of such qualification or registration would not reasonably be expected to be material to the operations of ConnectM.
Section 5.02 Due Authorization; Enforceability. The execution and delivery of this Agreement and each of the Transaction Documents by ConnectM and the performance by ConnectM of the obligations hereunder and thereunder and the consummation of the Transactions have been duly and validly authorized by all necessary action of such ConnectM’s board of directors. This Agreement and each of the Transaction Documents to which ConnectM is a party constitutes, or will constitute, when executed and delivered, a valid and binding agreement of ConnectM, enforceable against ConnectM in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and other laws relating to or affecting the enforcement of creditors’ rights and remedies generally and the availability of specific performance or other equitable remedies, subject to the receipt of any approvals as referenced in Section 3.03(d), if determined to be required as set forth therein.
Section 5.03 No Conflict; Consents. The execution and delivery by ConnectM of the Transaction Documents to which ConnectM is a party and the consummation by ConnectM of the Transactions do not and will not: (a) violate or result in a breach of any of the terms or provisions of any instrument, document or agreement to which ConnectM is a party or by which ConnectM is bound; (b) violate any order, writ, injunction, decree, judgment, ruling, law, rule or regulation of any federal, state, county, municipal or foreign court or governmental authority applicable to ConnectM; or (c) violate or conflict with any provision of the organizational or other governing documents of ConnectM, in each case, in a manner that would be reasonably likely to prohibit, restrict or delay the performance of the Transactions by ConnectM.
Section 5.04 No Broker or Finder. ConnectM has not engaged, and shall not have any liability for, any investment banker, finder, broker or sales agent or any other Person in connection with the origin, negotiation, execution, delivery or performance of any Transaction Document to which it is a party, or the Transactions.
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ARTICLE VI. Registration Rights
Section 6.01 Piggyback Registration Rights.
| (a) | Registration Rights. If at any time while Seller remains the holder of any of the Payment Shares, ConnectM proposes to file any registration statement under the Securities Act with respect to the Common Stock (a “Registration Statement”) for its own account or for shareholders of ConnectM for their account (or by ConnectM and by shareholders of ConnectM), other than a Registration Statement (i) filed in connection with any employee stock option or other benefit plan, (ii) for a dividend reinvestment plan or (iii) in connection with a merger or acquisition, then ConnectM shall (x) give written notice of such proposed filing to Seller as soon as practicable but in no event less than ten (10) days before the anticipated filing date of the Registration Statement, which notice shall describe the amount and type of securities to be included in such Registration Statement, the intended method(s) of distribution, and the name of the proposed managing underwriter or underwriters, if any, of the offering, and (y) offer to Seller in such notice the opportunity to register the sale of such number of Payment Shares as Seller may request in writing within five (5) days following receipt of such notice (a “Piggyback Registration”). The Company shall cause such Payment Shares to be included in such registration and shall cause the managing underwriter or underwriters of a proposed underwritten offering to permit the Payment Shares requested to be included in a Piggyback Registration on the same terms and conditions as any similar securities of ConnectM and to permit the sale or other disposition of such Payment Shares in accordance with the intended method(s) of distribution thereof. If Seller proposes to distribute its Payment Shares through a Piggyback Registration that involves an underwriter or underwriters, then it shall enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such Piggyback Registration. |
| (b) | Limitations. If a Piggyback Registration is initiated as a primary underwritten offering on behalf of ConnectM and the managing underwriter advises ConnectM and Seller and the holders of any other shares of Common Stock which are also shares of Common Stock which are subject to registration rights under an agreement similar to this Article VI (if any holders of such shares of Common Stock have elected to include such shares of Common Stock in such Piggyback Registration) in writing that in its reasonable and good faith opinion the number of shares of Common Stock proposed to be included in such registration, including all Payment Shares and all other shares of Common Stock proposed to be included in such underwritten offering, exceeds the number of shares of Common Stock which can be sold in such offering and/or that the number of shares of Common Stock proposed to be included in any such registration or takedown would adversely affect the price per share of the Common Stock to be sold in such offering, ConnectM shall include in such registration (i) first, the shares of Common Stock that ConnectM proposes to sell; and (ii) the shares of Common Stock requested to be included therein by Seller and the other holders of shares of Common Stock which are subject to registration rights under an agreement similar to this Article VI, allocated among Seller and such other holders pro rata based on the number of Payment Shares held by Seller and shares of Common Stock held by such other holders. |
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| (c) | Withdrawal. Seller may elect to withdraw Seller’s request for inclusion of Payment Shares in any Piggyback Registration by giving written notice to ConnectM of such request to withdraw prior to the effectiveness of the Registration Statement. The Company (whether on its own determination or as the result of a withdrawal by persons making a demand pursuant to written contractual obligations) may withdraw a Registration Statement at any time prior to the effectiveness of such Registration Statement. |
Section 6.02 Notification. The Company shall notify Seller at any time when a prospectus relating to the Payment Shares is required to be delivered under the Securities Act, upon discovery that, or upon the happening of any event as a result of which, the prospectus included in such Registration Statement, as then in effect, includes an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing. At the request of Seller, ConnectM shall also prepare, file and furnish to Seller a reasonable number of copies of a supplement to or an amendment of such prospectus as may be necessary so that, as thereafter delivered to Seller, such prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing. Seller shall not offer or sell any Payment Shares covered by the Registration Statement after receipt of such notification until the receipt of such supplement or amendment.
Section 6.03 Information. The Company may request that Seller furnish ConnectM such information with respect to Seller and Seller’s proposed distribution of the Payment Shares pursuant to the Registration Statement as ConnectM may from time to time reasonably request in writing or as shall be required by law or by the SEC or any securities market or securities exchange in connection therewith, and Seller shall furnish ConnectM with such information as a condition of the exercise of Seller’s rights pursuant to this Article VI.
Section 6.04 Fees and Expenses. All fees and expenses incident to the performance of or compliance with Section 6.01 by ConnectM shall be borne by ConnectM whether or not any Payment Shares are sold pursuant to a Registration Statement. The fees and expenses referred to in the foregoing sentence shall include, without limitation, (i) all registration and filing fees (including, without limitation, fees and expenses of ConnectM’s counsel and independent registered public accountants) (A) with respect to filings made with the SEC, (B) with respect to filings required to be made with any trading market on which the Common Stock is then listed for trading, (C) in compliance with applicable state securities or Blue Sky laws reasonably agreed to by ConnectM in writing (including, without limitation, fees and disbursements of counsel for ConnectM in connection with Blue Sky qualifications or exemptions of the Payment Shares) and (D) with respect to any filing that may be required to be made by any broker through which Seller of Payment Shares intends to make sales of Payment Shares with the Financial Industry Regulatory Authority, (ii) printing expenses, (iii) messenger, telephone and delivery expenses, (iv) fees and disbursements of counsel for ConnectM, (v) Securities Act liability insurance, if ConnectM so desires such insurance, and (vi) fees and expenses of all other persons or entities retained by ConnectM in connection with the consummation of the transactions contemplated by this Agreement. In addition, ConnectM shall be responsible for all of its internal expenses incurred in connection with the consummation of the transactions contemplated by this Agreement (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), the expense of any annual audit and the fees and expenses incurred in connection with the listing of the Payment Shares on any securities exchange as required hereunder. In no event shall ConnectM be responsible for any broker or similar commissions of Seller.
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ARTICLE VII. Certain Covenants and Agreements
Section 7.01 Records. The Seller Parties and ConnectM hereby agree to preserve for a period of seven (7) years following the Closing, all records in their respective possession relating to any of the Assets, the Business or the Transactions. If any of the Parties hereto need access to such records in the possession of any other Party hereto for the preparation of federal and state tax returns, each such Party will allow representatives of each other Party access to such records for the purpose of obtaining information for use as aforesaid, and will permit such other Party to make extracts and copies thereof as may be reasonably necessary or convenient and, if required for such purpose, to have access to and possession of original documents. The Seller Parties hereby agree to preserve originals of all Purchased Records for a period of seven (7) years following the Closing. If ConnectM desires access to the Purchased Records, the Seller Parties will allow representatives of ConnectM access to such Purchased Records and will permit representatives of ConnectM to make extracts and copies thereof as may be reasonably necessary or convenient and, if required, to have access to and possession of original documents, in each case at the cost of ConnectM.
Section 7.02 Notices of Certain Events. In addition to any other notice required to be given by the terms of this Agreement, each of the Parties shall promptly notify each of the other Parties of:
| (a) | any notice or other communication from any Person alleging that the consent of such Person is or may be required in connection with any of the Transactions; |
| (b) | any notice or other communication from any governmental or regulatory agency or authority in connection with the Transactions; and |
| (c) | any actions, suits, claims, investigations or proceedings commenced or, to its knowledge threatened against, relating to or involving or otherwise affecting such Party that, if pending on the date of this Agreement, would have been required to have been disclosed pursuant hereto or that relates to the consummation of the Transactions. |
Section 7.03 Access to Information. Following the Effective Date, until consummation of the Transactions or the earlier termination of this Agreement, the Seller Parties shall give to ConnectM and its authorized representatives full and complete access to the books and records, Contracts, facilities and personnel of the Seller Parties as ConnectM and its authorized representatives may request so that ConnectM may complete its due diligence investigation of the Seller Parties and the Assets. The Seller Parties agree to provide ConnectM and its authorized representatives with access to any information in any of their possession or control that contains information generated by any Seller Party regarding any Seller Party relative to its financial, operational, and/or regulatory condition (present, past, or prospective). If ConnectM, in its sole discretion, at any time prior to the Closing determines that its due diligence review of the Assets is not satisfactory to ConnectM, then ConnectM may terminate this Agreement upon notice to the Seller Parties.
Section 7.04 Consents of Third Parties. Each of the Parties will give any notices to third parties, and will use its commercially reasonable efforts to obtain any third-party consents, that the other Parties reasonably may request in connection with this Agreement. Each of the Parties will give any notices to, make any filings with, and use its commercially reasonable efforts to obtain any authorizations, consents, and approvals of governments and governmental agencies in connection with the matters in this Agreement.
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Section 7.05 Non-Assignable Contracts. The Seller will, during the remaining term of each Non-Assignable Contract, use commercially reasonable efforts to (a) obtain the consent of the applicable third party, (b) make the benefit of each such Non-Assignable Contracts available to ConnectM following the Closing, and (c) enforce following the Closing, at the request of ConnectM and at the expense and for the account of ConnectM, any right of the Seller arising from such Non-Assignable Contracts against the other party or parties thereto (including the right to elect or terminate any such Non-Assignable Contract in accordance with the terms thereof). The Seller Parties will not take any action or suffer any omission that would limit or restrict or terminate the benefits to ConnectM of any such Non-Assignable Contract. With respect to any such Non-Assignable Contract as to which the necessary approval or consent for the assignment or transfer to ConnectM is obtained following the Closing, the Seller will transfer such Non-Assignable Contract to ConnectM by execution and delivery of an instrument of conveyance reasonably satisfactory to ConnectM and the Seller Parties within three (3) Business Days following receipt of such approval or consent.
Section 7.06 Misdirected Payments. If the Seller Parties or any of their Affiliates receives any payment related to the Business or any Asset after the Closing Date, the Seller agrees to promptly remit (or cause to be promptly remitted) such funds to ConnectM. If ConnectM or any Affiliate of ConnectM receives any payment related to any Excluded Asset after the Closing Date, ConnectM agrees to promptly remit (or cause to be promptly remitted) such funds to the Seller.
Section 7.07 No-Shop.
| (a) | From the Effective Date until the first to occur of the Closing or the termination of this Agreement in accordance with its terms, no Seller Party shall, and each Seller Party shall cause the Representatives of each Seller Party not to, directly or indirectly: |
| (i) | solicit, initiate, knowingly encourage or knowingly facilitate the making, submission or announcement of any Acquisition Proposal or Acquisition Inquiry; |
| (ii) | furnish any non-public information regarding any Seller Party to any Person who has made an Acquisition Proposal or an Acquisition Inquiry; |
| (iii) | engage in discussions or negotiations with any Person who has made any Acquisition Proposal or Acquisition Inquiry; |
| (iv) | approve, endorse or recommend any Acquisition Proposal or Acquisition Inquiry; |
| (v) | withdraw or propose to withdraw its approval and recommendation in favor of this Agreement and the Transactions; or |
| (vi) | enter into any letter of intent, agreement in principle, merger, acquisition, purchase or joint venture agreement or other similar agreement for any Acquisition Transaction. |
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| (b) | From the Effective Date until the first to occur of the Closing or the termination of this Agreement in accordance with its terms, no Seller Party shall (i) approve or recommend, or propose publicly to approve or recommend, any Acquisition Proposal, (ii) take any action to make the provisions of any “fair price”, “moratorium”, “control share acquisition”, “business combination” or other similar anti-takeover statute or regulation inapplicable to any transaction contemplated by an Acquisition Proposal related to any Seller Party, or (iii) approve or recommend, or propose publicly to approve or recommend, or cause or authorize any Seller Party to enter into, any letter of intent, agreement in principle, merger, acquisition, purchase or joint venture agreement or Contract or other instrument in respect of or relating to an Acquisition Proposal. |
| (c) | Each Seller Party shall promptly, within 36 hours, advise ConnectM orally and in writing of any Acquisition Proposal or Acquisition Inquiry (including the identity of the Person making or submitting such Acquisition Proposal or Acquisition Inquiry and the terms thereof and all material modifications thereto) that is made or submitted by any Person during the period beginning on the Effective Date until the Closing or the termination of this Agreement in accordance with its terms. Each Seller Party shall keep ConnectM reasonably informed on a current basis of any material developments in the status and terms of any such Acquisition Proposal or Acquisition Inquiry (including whether such Acquisition Proposal or Acquisition Inquiry has been withdrawn or rejected and any material change to the terms thereof). |
| (d) | Each Seller Party shall immediately cease and cause to be terminated any discussions existing as of the Effective Date with any Person that relate to any Acquisition Proposal or Acquisition Inquiry proposed on or prior to the Effective Date. Each Seller Party acknowledges and agree that any actions taken by or at the direction of a Representative of any Seller Party that, if taken by any Seller Party, would constitute a breach or violation of this Section 7.07 will be deemed to constitute a breach and violation of this Section 7.07 by such Seller Party. |
Section 7.08 Affirmative Covenants. Between the Effective Date and the Closing Date or earlier termination of this Agreement in accordance with its terms, and except as otherwise contemplated by this Agreement or as ConnectM shall otherwise consent in writing in advance, each Seller Party shall, and shall cause each of their Representatives to:
| (a) | conduct the business of each Seller Party only in the Ordinary Course of Business and will use commercially reasonable best efforts to maintain and preserve the assets of each Seller Party, preserve intact the current business organization of each Seller Party, and maintain the relations and goodwill with customers, creditors, employees, agents, and others having business relationships with each Seller Party; |
| (b) | furnish to ConnectM true, correct and complete copies of all records, documentation and other information in its possession as ConnectM may reasonably request concerning any Seller Part; |
| (c) | cause all Contracts to which any Seller Party is a party to be performed to the extent required to be performed as of the Closing Date in full; |
| (d) | cooperate with ConnectM with respect to all filings, permits or consents that ConnectM elects to make or obtain or is required by Law or other Persons to make or obtain in connection with the Transactions; |
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| (e) | provide notice to ConnectM as promptly as reasonably practicable upon becoming aware of any event or occurrence capable of causing a material impact on the business of any Seller Party; and |
| (f) | use commercially reasonable efforts to cause the conditions precedent in Section 3.01(c) to be satisfied. |
Section 7.09 Negative Covenants. Between the Effective Date and the Closing Date or earlier termination of this Agreement in accordance with its terms, and except as otherwise contemplated by this Agreement or as ConnectM shall otherwise consent in writing in advance, no Seller Party will, and each Seller Party will cause each of their Representatives not to, directly or indirectly:
| (a) | dispose of any individual capital asset, and will not incur, create or assume any Lien on any individual capital asset, in each case with a value in excess of $5,000, and provided that such disposition will not materially impact the operation of the business of any Seller Party or result in a Seller Material Adverse Effect; |
| (b) | take any action which could be reasonably expected to prevent or materially delay the consummation of the Transactions; |
| (c) | enter into any new material line of business or commit to any material capital expenditure outside of the Ordinary Course of Business; |
| (d) | (1) issue, authorize or propose the issuance of any Equity Security of any Seller Party, (2) adopt a plan of complete or partial liquidation or resolutions providing for or authorizing such liquidation or a dissolution, merger, consolidation, restructuring, recapitalization or other reorganization, or (3) make any distribution of, or directly or indirectly repurchase, redeem or otherwise acquire, any Equity Security of any Seller Party; |
| (e) | amend any of Organizational Documents of any Seller Party; |
| (f) | make or announce any increase in salaries, bonuses or other compensation or fringe benefits payable or to become payable, or grant, announce, or increase any termination or severance, retention, change-of-control or similar payments, to any present or former employee, officer, director, agent or independent contractor of any Seller Party, or engage in any material reduction in force or promote any employee to or at or above the level of officer or senior management; |
| (g) | enter into any Contract that, if such Contract had been in effect on the Effective Date, would have been a material to the operations of any Seller Party, amend or terminate any contract that is material to the operations of any Seller Party or waive or cancel any material right thereunder, other than in the Ordinary Course of Business; |
| (h) | sell, lease or otherwise transfer, or create or incur any lien on the assets, securities, property, interests or businesses of any Seller Party other than in the Ordinary Course of Business; |
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| (i) | create, incur, or assume any indebtedness or trade debt outside of the Ordinary Course of Business; |
| (j) | change any method of accounting or accounting practice or accounting policy used by any Seller Party, other than such changes required by GAAP or requirements of Law; |
| (k) | acquire any business or Person, by merger, consolidation or otherwise, in a single transaction or a series of related transactions; or |
| (l) | agree to take any of the foregoing actions, except as expressly contemplated by this Agreement and the other agreements expressly contemplated hereby. |
Section 7.10 Effect of Knowledge on Indemnification. The right to indemnification, reimbursement or other remedy based upon any representations, warranties, covenants and obligations set forth in this Agreement shall not be affected by any investigation conducted with respect to, or any knowledge acquired (or capable of being acquired) at any time, whether before or after the execution and delivery of this Agreement, with respect to the accuracy or inaccuracy of or compliance with any such representation, warranty, covenant or obligation. The waiver of any condition based upon the accuracy of any representation or warranty, or on the performance of or compliance with any covenant or obligation, shall not affect the right to indemnification, reimbursement or other remedy based upon such representations, warranties, covenants or obligations.
Section 7.11 Further Assurances. Following the Effective Date and following the Closing, or until the earlier termination of this Agreement in accordance with its terms, each of the Parties shall, and shall cause their respective Affiliates to, execute and deliver such additional documents, instruments, conveyances and assurances and take such further actions as may be reasonably required to carry out the provisions hereof and give effect to the Transactions.
Section 7.12 Confidential Information. The Seller Parties will hold in confidence at all times after the Closing all Confidential Information, and will not disclose, publish or make use of Confidential Information at any time after the Closing without the prior written consent of ConnectM, except as may be required by applicable Laws.
ARTICLE VIII. Termination
Section 8.01 Termination. This Agreement may be terminated and the transactions contemplated herein may be abandoned at any time prior to the Closing as follows:
| (a) | By the mutual agreement of the Parties, each in their sole discretion; |
| (b) | by the Seller Parties, acting jointly, or by ConnectM, if there shall be in effect a final non-appealable order, judgment, injunction or decree entered by or with any Governmental Entity restraining, enjoining or otherwise prohibiting the consummation of the Transactions; |
| (c) | by ConnectM if there shall have been a breach in any material respect of any representation, warranty, covenant or agreement on the part of any Seller Party set forth in this Agreement and such breach has not been cured within ten (10) days after receipt of notice of such breach by the Seller Parties (a “Seller Party Default”); |
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| (d) | by the Seller Parties, acting jointly, if there shall have been a breach in any material respect of any representation, warranty, covenant or agreement on the part of ConnectM set forth in this Agreement and such breach has not been cured within ten (10) days after receipt of notice of such breach by ConnectM (a “ConnectM Default”); |
| (e) | By any Party in the event that the Closing of the transactions contemplated hereunder has not occurred by December 19, 2025 (the “Outside Closing Date”), provided, however, the right to terminate this Agreement under this Section 8.01(e) shall not be available to a Party if the breach or violation by such Party or its Affiliates of any representation, warranty, covenant or obligation under this Agreement was the cause of, or resulted in, the failure of the Closing to occur on or before the Outside Date; or |
| (f) | by written notice by ConnectM to the Seller Parties, if there shall have been a Seller Material Adverse Effect following the Effective Date which is uncured for at least twenty (20) Business Days after written notice of such Seller Material Adverse Effect is provided by ConnectM to the Seller Parties. |
Section 8.02 Effect of Termination. In the event of termination of this Agreement pursuant to this Article VIII, this Agreement (other than this Article VIII and Article X, which shall each survive and shall remain in full force and effect) shall become void and of no further force or effect with no liability on the part of any Party; provided, however, that any such termination shall not relieve any Party from liability for actual damages to the other Parties resulting from a material breach of this Agreement by such Party.
Section 8.03 Default by ConnectM. If ConnectM fails to perform any of its obligations under this Agreement, the Seller Parties shall be entitled to bring an action for specific performance, damages or a combination of specific performance and damages. No remedy conferred upon any Seller Party is intended to be exclusive of any other remedy provided for in this Agreement, and each remedy provided to the Seller Parties in this Agreement will be cumulative and in addition to every other remedy available to the Seller Parties under this Agreement. No single or partial exercise of any remedy will preclude any other or further exercise thereof. This provision shall be in addition to the Seller Parties’ remedies under Section 9.03 if the Closing occurs.
Section 8.04 Default by Seller Parties. If any Seller Party fails to perform any of their respective obligations under this Agreement, ConnectM shall be entitled to bring an action for specific performance, damages or a combination of specific performance and damages. No remedy conferred upon ConnectM is intended to be exclusive of any other remedy provided for in this Agreement, and each remedy provided to ConnectM in this Agreement will be cumulative and in addition to every other remedy available to ConnectM under this Agreement. No single or partial exercise of any remedy will preclude any other or further exercise thereof. This provision shall be in addition to ConnectM’s remedies under Section 9.02 if the Closing occurs.
Section 8.05 Expenses. In the event the Closing does not occur, other than as specifically set forth herein, any out-of-pocket expenses (including all fees and expenses of counsel, accountants, investment bankers, financial advisors, financing sources, experts and consultants to a Party hereto or any of its Affiliates) incurred by a Party or on its behalf in connection with or related to the authorization, preparation, negotiation, execution or performance of this Agreement or any Transaction Document and all other matters related to the consummation of this Agreement incurred in connection with this Agreement and the Transactions shall be paid by the Party incurring such expenses.
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ARTICLE IX. Survival; Indemnification
Section 9.01 Survival.
| (a) | Subject to the limitations and other provisions of this Agreement, the representations and warranties of the Parties contained herein shall survive the Closing and shall remain in full force and effect until the date that is eighteen (18) months after the Closing Date; provided, that the Seller Fundamental Representations and ConnectM Fundamental Representations shall survive the Closing for a period of five (5) years. Notwithstanding the preceding sentence, any indemnification claim commenced prior to any such expiration shall remain as a valid claim until finally resolved in accordance with the provisions herein. Any claim, for indemnification or otherwise, based upon or arising out of the breach or alleged breach of a representation or warranty must be brought before the expiration of the applicable survival period, or it will be deemed waived. |
| (b) | All covenants and agreements of the Parties contained herein shall survive the Closing for a period of five (5) years or for the period specified therein. Notwithstanding the preceding sentence, any claim commenced prior to any such expiration shall remain as a valid claim until finally resolved in accordance with the provisions herein. |
| (c) | Any claim arising out of or in connection with this Agreement must be brought, if at all, within five years after the Closing Date, or within such shorter period as may be specified with respect to a particular claim, or it will be deemed waived and released. |
Section 9.02 Indemnification by the Seller Parties. Subject to the provisions of this Article IX, if the Closing occurs, the Seller Parties hereby covenant and agree with ConnectM that the Seller Parties, jointly and severally, shall indemnify ConnectM and its directors, officers, employees and Affiliates, and each of their respective Representatives, successors and assigns (individually, an “ConnectM Indemnified Party”), and hold them harmless from, against and in respect of any and all Losses incurred by any ConnectM Indemnified Party resulting from (i) any misrepresentation, breach of any representation or warranty of any Seller Party in this Agreement or the non-fulfillment in any material respect of any agreement, covenant or obligation by any Seller Party made in this Agreement (including without limitation any Exhibit or Schedule hereto and any certificate or instrument delivered in connection herewith) or (ii) (ii) with respect to the agreements of the Parties as set forth in Article VI, arising out of or relating to (1) any untrue or alleged untrue statement of a material fact contained in a Registration Statement, any related prospectus or any form of prospectus or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or relating to any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein (in the case of any such prospectus or supplement thereto, in light of the circumstances under which they were made) not misleading or (2) any violation or alleged violation by ConnectM of the Securities Act, the Exchange Act or any state securities law, or any rule or regulation thereunder, in connection with the performance of its obligations under Article VI, but only to the extent that such untrue statements or omissions are based upon information regarding Seller furnished to ConnectM by any party for use therein..
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Section 9.03 Indemnification by ConnectM. Subject to the provisions of this Article IX, if the Closing occurs, ConnectM hereby covenants and agrees with the Seller Parties that ConnectM shall indemnify each Seller Party (each a “Seller Impex Indemnified Party” and collectively, the “Seller Impex Indemnified Parties”) and hold them harmless from, against and in respect of any and all Losses incurred by any Seller Impex Indemnified Party resulting from any misrepresentation, breach of any representation or warranty in this Agreement or the non-fulfillment in any material respect of any agreement, covenant or obligation by ConnectM made in this Agreement (including without limitation any Exhibit or Schedule hereto and any certificate or instrument delivered in connection herewith).
Section 9.04 Indemnification Procedures. The Party making a claim under this Article IX is referred to as the “Indemnified Party” and the Party against whom such claims are asserted under this Article IX is referred to as the “Indemnifying Party.”
| (a) | Third-Party Claims. If any Indemnified Party receives notice of the assertion or commencement of any Action made or brought by any Person who is not a party to this Agreement or an Affiliate of a party to this Agreement or a Representative of the foregoing (a “Third-Party Claim”) against such Indemnified Party with respect to which the Indemnifying Party is obligated to provide indemnification under this Agreement, the Indemnified Party shall give the Indemnifying Party reasonably prompt written notice thereof, but in any event not later than thirty (30) calendar days after receipt of such notice of such Third-Party Claim, which notice shall describe the indemnification claim in reasonable detail; include the justification for the demand with reasonable specificity; include copies of all available material written evidence; and, if reasonably practical, indicate the estimated amount of damages. The failure to give such prompt written notice shall not, however, relieve the Indemnifying Party of its indemnification obligations, except and only to the extent that the Indemnifying Party forfeits rights or defenses by reason of such failure. Such notice by the Indemnified Party shall describe the Third-Party Claim in reasonable detail, shall include copies of all material written evidence thereof and shall indicate the estimated amount, if reasonably practicable, of the Loss that has been or may be sustained by the Indemnified Party. The Indemnifying Party shall have the right to participate in, or by giving written notice to the Indemnified Party, to assume the defense of any Third-Party Claim at the Indemnifying Party’s expense and by the Indemnifying Party’s own counsel, and the Indemnified Party shall cooperate in good faith in such defense. In the event that the Indemnifying Party assumes the defense of any Third-Party Claim, subject to Section 9.04(b), it shall have the right to take such action as it deems necessary to avoid, dispute, defend, appeal or make counterclaims pertaining to any such Third-Party Claim in the name and on behalf of the Indemnified Party. The Indemnified Party shall have the right to participate in the defense of any Third-Party Claim with counsel selected by it subject to the Indemnifying Party’s right to control the defense thereof, provided that the fees and disbursements of such counsel shall be at the expense of the Indemnified Party. |
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| (b) | Settlement of Third-Party Claims. Notwithstanding any other provision of this Agreement, the Indemnifying Party shall not enter into settlement of any Third-Party Claim without the prior written consent of the Indemnified Party, except as provided in this Section 8.04(b). If a firm offer is made to settle a Third-Party Claim without leading to liability or the creation of a financial or other obligation on the part of the Indemnified Party and provides, in customary form, for the unconditional release of each Indemnified Party from all liabilities and obligations in connection with such Third-Party Claim and the Indemnifying Party desires to accept and agree to such offer, the Indemnifying Party shall give written notice to that effect to the Indemnified Party. If the Indemnified Party consents to such firm offer the Indemnifying Party may settle the Third-Party Claim upon the terms set forth in such firm offer to settle such Third-Party Claim. If the Indemnified Party objects to such offer, or does not provide a response to such firm offer within ten days after its receipt of such notice (in which case the Indemnified Party shall be deemed to not have consented to such offer), the Indemnified Party shall thereafter assume the defense of such Third-Party Claim and shall continue to contest or defend such Third-Party Claim and in such event the maximum liability of the Indemnifying Party as to such Third-Party Claim shall not exceed the amount of such settlement offer. If the Indemnified Party has assumed the defense pursuant to this Section 8.04(b), the Indemnified Party shall not agree to any settlement without the written consent of the Indemnifying Party (which consent shall not be unreasonably withheld or delayed). |
| (c) | Direct Claims. Any Action by an Indemnified Party on account of a Loss which does not result from a Third-Party Claim (a “Direct Claim”) shall be asserted by the Indemnified Party giving the Indemnifying Party reasonably prompt written notice thereof, but in any event not later than thirty (30) calendar days after the Indemnified Party becomes aware of such Direct Claim, which notice shall describe the indemnification claim in reasonable detail; include the justification for the demand with reasonable specificity; include copies of all available material written evidence; and, if reasonably practical, indicate the estimated amount of damages. The failure to give such prompt written notice shall not, however, relieve the Indemnifying Party of its indemnification obligations, except and only to the extent that the Indemnifying Party forfeits rights or defenses by reason of such failure. Such notice by the Indemnified Party shall describe the Direct Claim in reasonable detail, shall include copies of all material written evidence thereof and shall indicate the estimated amount, if reasonably practicable, of the Loss that has been or may be sustained by the Indemnified Party. The Indemnifying Party shall have thirty (30) calendar days after its receipt of such notice to respond in writing to such Direct Claim. The Indemnified Party shall allow the Indemnifying Party and its professional advisors to investigate the matter or circumstance alleged to give rise to the Direct Claim, and whether and to what extent any amount is payable in respect of the Direct Claim and the Indemnified Party shall assist the Indemnifying Party’s investigation by giving such information and assistance as the Indemnifying Party or any of its professional advisors may reasonably request. If the Indemnifying Party does not so respond within such thirty (30) calendar day period, the Indemnifying Party shall be deemed to have accepted liability for such claim, in which case the Indemnified Party shall be free to pursue such remedies as may be available to the Indemnified Party on the terms and subject to the provisions of this Agreement. |
| (d) | Cooperation. Upon a reasonable request made by the Indemnifying Party, each Indemnified Party seeking indemnification hereunder in respect of any Direct Claim, hereby agrees to consult with the Indemnifying Party and act reasonably to take actions reasonably requested by the Indemnifying Party in order to attempt to reduce the amount of Losses in respect of such Direct Claim. Any costs or expenses associated with taking such actions shall be included as Losses hereunder. |
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Section 9.05 Payments. Upon a determination of liability under this Article IX, the Indemnifying Party shall pay or cause to be paid to the Indemnified Party the amount so determined within five (5) Business Days after the date of such determination. If there should be a dispute as to the amount or manner of determination of any indemnity obligation owed under this Agreement, the Indemnifying Party shall nevertheless pay when due such portion, if any, of the obligation that is not subject to dispute. Upon the payment in full of any amounts due under this Article VIII with respect to any claim, the Indemnifying Party shall be subrogated to the rights of the Indemnified Party against any Person with respect to the subject matter of such claim.
Section 9.06 Certain Limitations. The indemnification provided for in Section 9.02 and Section 9.3 shall be subject to the following limitations:
| (a) | The Seller Parties shall not be liable to ConnectM Indemnified Parties for indemnification under Section 9.02 (other than with respect to a claim for indemnification based upon, arising out of, with respect to or by reason of fraud or any inaccuracy in or breach of any of the Seller Fundamental Representations (the “Basket Exclusions”) until the aggregate amount of all Losses in respect of indemnification under Section 9.02 (other than those based upon, arising out of, with respect to or by reason of the Basket Exclusions) exceeds $10,000 (the “Basket”), in which event the Seller Parties shall be required to pay or be liable for all such Losses in excess of the Basket. |
| (b) | The Parties acknowledge and agree that the maximum liability of the Seller Parties, on the one hand, and ConnectM, on the other hand, for indemnification pursuant to this Article IX shall be the sum of $750,000 (the “Cap”), and neither the Seller Parties, on the one hand, or ConnectM, on the other hand, shall have any liability to the other in excess of the Cap. |
Section 9.07 Tax Treatment of Indemnification Payments. All indemnification payments made under this Agreement shall be treated by the Parties as an adjustment to the consideration paid hereunder unless otherwise required by applicable Laws.
Section 9.08 Effect of Investigation. The representations, warranties and covenants of the Indemnifying Party, and the Indemnified Party’s right to indemnification with respect thereto, shall not be affected or deemed waived by reason of any investigation, ) made at any time, whether before or after the execution and delivery of this Agreement, with respect to the accuracy or inaccuracy of or compliance with any such representation, warranty, covenant or obligation, and made by or on behalf of the Indemnified Party (including by any of its Representatives) or by reason of the fact that the Indemnified Party or any of its Representatives knew or should have known that any such representation or warranty is, was or might be inaccurate. The waiver of any condition based upon the accuracy of any representation or warranty, or on the performance of or compliance with any covenant or obligation, shall not affect the right to indemnification, reimbursement or other remedy based upon such representations, warranties, covenants or obligations.
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Section 9.09 Exclusive Remedy. In the event that the Closing occurs, the indemnification provisions contained in this Article IX shall be the sole and exclusive remedy of the Parties with respect to the Transactions for any and all breaches or alleged breaches of any representations, warranties, covenants or agreements of the Parties or any other provision of this Agreement or arising out of the Transactions, except (i) with respect to any equitable remedy to which such Party may be entitled to with respect to any claims or causes of action arising from the breach of any covenants or agreement of a Party that is to be performed subsequent to the Closing Date, or (ii) with respect to a Party, an actual and intentional fraud with respect to this Agreement and the Transactions. In furtherance of the foregoing, each Party hereto, for itself and on behalf of its Affiliates, hereby waives, from and after the Closing, to the fullest extent permitted under applicable Laws and except as otherwise specified in this Article IX or in Section 10.05, any and all rights, claims and causes of action it may have against any other Party hereto relating to the subject matter of this Agreement or any other agreement, certificate or other document or instrument delivered pursuant to this Agreement, arising under or based upon any applicable Laws.
ARTICLE X. Miscellaneous
Section 10.01 Notices.
| (a) | Any notice or other communications required or permitted hereunder shall be in writing and shall be sufficiently given if personally delivered to it or sent by email, overnight courier or registered mail or certified mail, postage prepaid, addressed as follows: |
if to ConnectM, to:
ConnectM Technology Solutions, Inc.
Attn: Bhaskar Panigrahi
2 Mount Royal Avenue, Suite 550
Marlborough, Massachusetts 01752
Email: [email protected]
With a copy, which shall not constitute notice, to:
Anthony, Linder & Cacomanolis, PLLC
Attn: John Cacomanolis
1700 Palm Beach Lakes Blvd., Suite 820
West Palm Beach, FL 33401
Email: [email protected]
If to any Seller Party, to:
Amperics Holdings LLC.
Attn: Bala Padmakumar
419 Webster Street
Monterey, CA 93940
Email: [email protected]
| (b) | Any Party may change its address for notices hereunder upon notice to each other Party in the manner for giving notices hereunder. |
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| (c) | Any notice hereunder shall be deemed to have been given (i) upon receipt, if personally delivered, (ii) on the day after dispatch, if sent by overnight courier, (iii) upon dispatch, if transmitted by email with return receipt requested and received and (iv) three (3) days after mailing, if sent by registered or certified mail. |
Section 10.02 Governing Law. This Agreement, and all matters based upon, arising out of or relating in any way to the Transactions, including, without limitation, tort claims, statutory claims and contract claims, shall be interpreted, construed, governed and enforced under and in accordance with the substantive and procedural Laws of the State of Delaware in each case as in effect from time to time and as the same may be amended from time to time, and as applied to agreements performed wholly within the State of Delaware.
Section 10.03 Jurisdiction. ANY LEGAL SUIT, ACTION OR PROCEEDING ARISING OUT OF OR BASED UPON THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREIN SHALL BE INSTITUTED SOLELY IN THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA OR THE COURTS OF THE STATE OF MASSACHUSETTES, IN EACH CASE LOCATED IN MIDDLESEX COUNTY, MASSACHUSETTES, AND EACH PARTY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF SUCH COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING. SERVICE OF PROCESS, SUMMONS, NOTICE OR OTHER DOCUMENT BY MAIL TO SUCH PARTY’S ADDRESS SET FORTH HEREIN SHALL BE EFFECTIVE SERVICE OF PROCESS FOR ANY SUIT, ACTION OR OTHER PROCEEDING BROUGHT IN ANY SUCH COURT. THE PARTIES IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY OBJECTION TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR ANY PROCEEDING IN SUCH COURTS AND IRREVOCABLY WAIVE AND AGREE NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
Section 10.04 Waiver of Jury Trial. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS, THE PERFORMANCE THEREOF OR THE FINANCINGS CONTEMPLATED THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 10.04. EACH OF THE PARTIES ACKNOWLEDGE THAT EACH HAS BEEN REPRESENTED IN CONNECTION WITH THE SIGNING OF THE WAIVER ABOVE BY INDEPENDENT LEGAL COUNSEL SELECTED BY THE RESPECTIVE PARTY AND THAT SUCH PARTY HAS DISCUSSED THE LEGAL CONSEQUENCES AND IMPORT OF THIS WAIVER WITH LEGAL COUNSEL. EACH OF THE PARTIES FURTHER ACKNOWLEDGE THAT EACH HAS READ AND UNDERSTANDS THE MEANING OF SUCH WAIVER AND GRANTS THIS WAIVER KNOWINGLY, VOLUNTARILY, WITHOUT DURESS AND ONLY AFTER CONSIDERATION OF THE CONSEQUENCES OF THIS WAIVER WITH LEGAL COUNSEL.
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Section 10.05 Specific Performance. The Parties agree that irreparable damage would occur if any provision of this Agreement were not performed in accordance with the terms hereof and that the Parties shall be entitled to specific performance of the terms hereof, in addition to any other remedy to which they are entitled at Laws or in equity.
Section 10.06 Limitation on Damages. In no event will any Party be liable to any other Party under or in connection with this Agreement or in connection with the Transactions for special, general, indirect or consequential damages, including damages for lost profits or lost opportunity, even if the Party sought to be held liable has been advised of the possibility of such damages.
Section 10.07 Attorneys’ Fees. In the event that any Party institutes any action or suit to enforce this Agreement or to secure relief from any default hereunder or breach hereof, the prevailing Party shall be reimbursed by the losing Party for all costs, including reasonable attorneys’ fees, incurred in connection therewith and in enforcing or collecting any judgment rendered therein.
Section 10.08 Public Announcements and Filings. Unless required by applicable Laws or regulatory authority, or the rules and regulations of any securities market on which the securities of ConnectM are listed or available for trading, none of the Parties will issue any report, statement or press release to the general public, trade or trade press, or to any third party (other than its advisors and representatives in connection with Transactions) or file any document, relating to this Agreement and Transactions, except as may be mutually agreed by the Parties. Copies of any such filings, public announcements or disclosures, including any announcements or disclosures mandated by Laws or regulatory authorities, shall be delivered to each Party prior to the release thereof.
Section 10.09 Third-Party Beneficiaries. This Agreement is strictly between the Parties and, except as specifically provided, no director, officer, stockholder, member, employee, agent, independent contractor or any other Person shall be deemed to be a third-Party beneficiary of this Agreement.
Section 10.10 Expenses. Except as specifically set forth herein, whether or not the Transactions are consummated, each of the Parties will bear their own respective expenses, including without limitation the fees and expenses of its legal, accounting and financial advisors, incurred in connection with the Exchange or any of the other Transactions.
Section 10.11 Entire Agreement. This Agreement and the other Transaction Documents represent the entire agreement between the Parties relating to the subject matter thereof and supersede all prior agreements, understandings and negotiations, written or oral, with respect to such subject matter. If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction. Upon such determination that any term or other provision is invalid, illegal or unenforceable, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in a mutually acceptable manner in order that the Transactions be consummated as originally contemplated to the greatest extent possible.
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Section 10.12 Construction. The table of contents and headings contained in this Agreement are for reference purposes only and will not affect in any way the meaning or interpretation of this Agreement.
Section 10.13 Amendment or Waiver.
| (a) | This may be amended, modified, superseded, terminated or cancelled, and any of the terms, covenants, representations, warranties or conditions hereof may be waived, only by a written instrument executed by both of the Parties, provided that any of the conditions in Article III may be waived by the Party for whose benefit such condition exists. |
| (b) | Every right and remedy provided herein shall be cumulative with every other right and remedy, whether conferred herein, at law, or in equity, and may be enforced concurrently herewith, and no waiver by any Party of the performance of any obligation by another Party shall be construed as a waiver of the same or any other default then, theretofore, or thereafter occurring or existing. |
| (c) | Neither any failure or delay in exercising any right or remedy hereunder or in requiring satisfaction of any condition herein nor any course of dealing shall constitute a waiver of or prevent any Party from enforcing any right or remedy or from requiring satisfaction of any condition. No notice to or demand on a Party waives or otherwise affects any obligation of that Party or impairs any right of the Party giving such notice or making such demand, including any right to take any action without notice or demand not otherwise required by this Agreement. No exercise of any right or remedy with respect to a breach of this Agreement shall preclude exercise of any other right or remedy, as appropriate to make the aggrieved Party whole with respect to such breach, or subsequent exercise of any right or remedy with respect to any other breach. |
Section 10.14 Commercially Reasonable Efforts. Subject to the terms and conditions herein provided, each Party shall use its commercially reasonable efforts to perform or fulfill all conditions and obligations to be performed or fulfilled by it under this Agreement so that Transactions shall be consummated as soon as practicable. Each Party also agrees that it shall use its commercially reasonable efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary, proper or advisable under applicable Laws and regulations to consummate and make effective this Agreement and the Transactions.
Section 10.15 Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the Parties and their respective successors and permitted assigns. No Party shall have any power or any right to assign or transfer, in whole or in part, this Agreement, or any of its rights or any of its obligations hereunder, including, without limitation, any right to pursue any claim for damages pursuant to this Agreement or the transactions contemplated herein, or to pursue any claim for any breach or default of this Agreement, or any right arising from the purported assignor’s due performance of its obligations hereunder, including by merger, consolidation, operation of law, or otherwise, without the prior written consent of the other Parties and any such purported assignment in contravention of the provisions herein shall be null and void and of no force or effect. Other than as specifically set forth herein, including in Article IX, nothing in this Agreement shall confer on any Person other than the Parties, and their respective successors and assigns, any rights, remedies, obligations, or Liabilities under or by reason of this Agreement.
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Section 10.16 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original and all of which taken together shall be but a single instrument. A signed copy of this Agreement delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.
[Signature Pages Follow]
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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date.
| ConnectM Technology Solutions, Inc. | ||
| By: | /s/ Bhaskar Panigrahi | |
| Name: | Bhaskar Panigrahi | |
| Title: | Chief Executive Officer | |
| Amperics Inc. | ||
| By: | /s/ Bala Padmakumar | |
| Name: | Bala Padmakumar | |
| Title: | Board of Directors | |
| Amperics Holdings LLC | ||
| By: | /s/ Bala Padmakumar | |
| Name: | Bala Padmakumar | |
| Title: | Managing Partner | |
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Exhibit A
Assets
Assumed Contracts :
| · | QSolar – Under negotiation. |
| · | Assigned Intellectual Property/Proprietary information |
| o | - Proprietary technology related to |
| ■ | Pseudocapacitors |
| ■ | Conductive Ink Formulations |
| ■ | Production techniques |
| ■ | Product specifications |
| · | Single Supercapacitor Cells |
| · | Supercapacitor Modules |
| · | Hybrid modules |
| ■ | Marketing collateral |
| o | Patents |
Exhibit A – Page 1
| AMPERICS PORTFOLIO | ||||||||||||
| REF. # | TYPE | STATUS | SERIAL # | TITLE | FILING DATE |
SOURCE | NOTES | CRITICAL DATE |
AGENTS | License | Tech ID | Atty Dkt |
| AMP01 | PCT | Filed | PCT/US2009/053527 | HIERARCHICAL NANOWIRE COMPOSITES FOR ELECTROCHEMICAL ENERGY STORAGE | 8/12/2009 | UCLA (Lu) | Conductive / Oxide Nanowire Interpenetrating Network | O'Banion (O'banion) | UCLA | 2009-058-2 | UC09-058-2FP | |
| P | Expired | 61/089,221 | Carbon nanotubes supported Vanadium oxide nanowire composites for electrochemical supercapacitor | 8/15/2008 | UCLA (Lu) | 8/15/2009 | Venable (Daley) | UCLA | 2009-058-2 | 58086-262775 | ||
| AMP02 | P | Filed | 61/232,899 | SUPERCAPACITORS WITH MULTIPLE NANOWIRE NETWORK ELECTRODES AND METHODS OF FABRICATING THE SAME | 8/11/2009 | Amperics | Asymmetric supercapacitor embodiments | 8/11/2010 | O'Banion (O'banion) | UC10-077-1 | ||
| AMP03 | PCT | Filed | PCT/US2009/055910 | CHARGE STORAGE DEVICE ARCHITECTURE FOR INCREASING ENERGY AND POWER DENSITY | 9/3/2009 | UCLA (Gruner) | Hybrid electrodes w/EDLC and redox materials on contact w/electrolyte & CC | O'Banion (O'banion) | UCLA | UC09-086-2FP | ||
| P | Expired | 61/094,353 | Charge Storage Device Architecture for Increased Energy and Power Density | 9/4/2008 | UCLA (Gruner) | 9/4/2009 | UCLA | 2009-086-1 | ||||
| AMP04 | NP | Filed | 12/576,937 | CHARGE STORAGE DEVICES CONTAINING CARBON NANOTUBE FILMS AS ELECTRODES AND CHARGE COLLECTORS | 10/9/2009 | UCLA (Gruner) | O'Banion (O'banion) | UCLA | UC07-520-2US | |||
| PCT | Expired | PCT/US2008/004593 | CHARGE STORAGE DEVICES CONTAINING CARBON NANOTUBE FILMS AS ELECTRODES AND CHARGE COLLECTORS | 4/10/2008 | UCLA (Gruner) | Venable (Daley) | UCLA | 2007-520-1 | UC07-520 | |||
| P1 | Expired | 60/907,587 | 4/10/2007 | UCLA (Gruner) | ||||||||
| P2 | Expired | 60/929,809 | 7/13/2007 | UCLA (Gruner) | ||||||||
| AMP05 | P | Filed | 61/143,653 | Charge Storage Device Architecture for Increased Energy and Power Density | 1/9/2009 | UCLA (Dunn) | Nanoparticle electrodes with tailored pore size | 1/11/2010 | O'Banion (O'banion) | UCLA | UC09-392-1 | |
| AMP06 | P | Expired | 61/260,217 | HIERARCHICAL CARBON MONOLITH SUPERCAPACITOR | 11/11/2009 | Madrid (del Monte) | HCMs with tailored bimodal pore size | 11/11/2010 | Catalyst IP Group | |||
| AMP07 | NP | Filed | 13/079,773 | TERNARY OXIDE SUPERCAPACITOR ELECTRODES | 4/4/2011 | Amperics | Ternary oxide electrodes | Catalyst IP Group | ||||
| P | Expired | 61/320703 | TERNARY OXIDE SUPERCAPACITOR ELECTRODES | 4/3/2010 | Amperics | Ternary oxide electrodes | 4/3/2011 | Catalyst IP Group | ||||
| AMP08 | NP | Filed | 13/089,299 | CHARGE STORAGE DEVICE ARCHITECTURE FOR INCREASING ENERGY AND POWER DENSITY | 4/18/2011 | Amperics | Three-component electrode (CNT, oxide, activated carbon composite structure) | Catalyst IP Group | ||||
| P | Expired | 61/325326 | CHARGE STORAGE DEVICE ARCHITECTURE FOR INCREASING ENERGY AND POWER DENSITY | 4/18/2010 | Amperics | Three-component electrode (CNT, oxide, activated carbon composite structure) | 4/18/2011 | Catalyst IP Group | ||||
Exhibit A – Page 2
Exhibit B
Bill of Sale and Assignment and Assumption Agreement
(Attached)
Exhibit 2.2
Bill of Sale and Assignment and Assumption Agreement
Dated as of 3rd November, 2025
This Bill of Sale and Assignment and Assumption Agreement (this “Bill of Sale”) is made and entered into as of the date set forth above (the “Closing Date”), by Amperics Holdings LLC, a California limited liability company (“Seller”) and ConnectM Technology Solutions, Inc., a Delaware corporation (the “Buyer”). The Seller and the Buyer may be referred to herein collectively as the “Parties” and each individually as a “Party”.
WHEREAS, Buyer, Seller and Amperics Inc., a Delaware corporation and the sole member of Seller (“Parent”) have entered into that certain Asset Purchase Agreement, dated as of October [ ], 2025 (“Agreement”), providing for Buyer to purchase from Seller certain assets and to assume from Seller certain liabilities;
WHEREAS, Seller desires to convey, transfer, assign, deliver, and contribute to Buyer all of Seller’s right, title, and interest in and to such assets, as further defined herein, and Buyer desires to accept all of Seller’s rights, title and interest in and to such assets; and
WHEREAS, Seller desires to convey, transfer, assign, deliver, and contribute to Buyer such liabilities, as further defined herein, and Buyer is willing to assume such liabilities;
NOW, THEREFORE, in consideration of $10 paid by the Buyer to the Seller, and the premises and of the terms and conditions herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, each intending to be legally bound, hereby agree as follows:
Article I. General Provisions.
Section 1.01 Definitions. Capitalized terms used herein without definition shall have the meanings given in the Agreement.
Section 1.02 Sale of Assets; Assignment of Contracts and Intellectual Property.
| (a) | Assets Generally. Seller hereby sells, grants, conveys, assigns, transfers and delivers to Buyer any and all of Seller’s right, title and interest in and to (i) (1) the assets as set forth on Exhibit 1 attached hereto; (2) copies of all information, files, correspondence, records, data, plans, reports, contracts, recorded knowledge, including customer, supplier, member, price and mailing lists, and all accounting or other books and records of the Seller in whatever media retained or stored, including computer programs and disks relating to the Business; and (3) the goodwill of the Business (collectively, the “Assets”); (ii) any state or common law rights in the Assets and the right of priority, together the right to sue for and collect, for its own use, all income, royalties, and damages hereafter due or payable to Seller with respect to the Assets, including without limitation, damages and payments for past, present, and future infringement or misappropriation of the Assets; and (iii) all of Seller’s other rights, title, and interest in the Assets, in each case free and clear of all Liens other than Permitted Liens. Such sale, transfer, conveyance and assignment shall be effective on the Closing Date. |
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| (b) | Assumed Contracts and Assigned Intellectual Property. In furtherance of the provisions of Section 1.02(a), effective as of the Closing Date, Seller hereby assigns, transfers and conveys to Buyer the Assumed Contracts and the Assigned Intellectual Property and any and all of Seller’s right, title and interest in and to the Assumed Contracts and the Assigned Intellectual Property including, without limitation, all rights, benefits and advantages of the Seller to be derived therefrom and all burdens, obligations and liabilities to be derived thereunder, in consideration of the premises set forth herein. Hereafter, Seller disclaims any further interest in the Assumed Contracts or the Assigned Intellectual Property, and the Seller shall be replaced by the Buyer for all purposes of the Assumed Contracts, and the Assumed Contracts are each hereby deemed amended to the extent required to give effect thereto. Buyer hereby expressly accepts the assignment and transfer of the Assumed Contracts and the Assigned Intellectual Property, and promises to observe and perform all services and obligations required under the Assumed Contracts, for as long as each Assumed Contract remains in full force and effect. Buyer hereby expressly assumes all of Seller’s rights and obligations related to the Assumed Contracts in accordance with the terms and conditions hereof and thereof. |
Section 1.03 Assumption of Liabilities.
| (a) | Effective as of the Closing Date, in accordance with the terms and subject to the conditions of this Bill of Sale, Seller hereby absolutely, unconditionally and irrevocably transfers, conveys, grants, sets over, delivers and assigns to Buyer, all of Seller’s right, title, benefit, privilege and interest in, to and under the following liabilities: (i) the obligations of the Seller under the Assumed Contracts to the extent arising and accruing from and after the Closing Date and not relating to a breach or default by the Seller or Parent or a failure to perform timely, in each case, prior to the Closing Date; and (ii) the obligations of the Seller with respect to the Assigned Intellectual Property to the extent arising and accruing from and after the Closing Date (the “Assumed Liabilities”). |
| (b) | Effective as of the Closing Date, in accordance with the terms and subject to the conditions of this Bill of Sale, Buyer shall, and Buyer hereby does, assume, and Buyer shall thereafter pay, perform and discharge in due course, all of the Assumed Liabilities. |
Section 1.04 Additional Provisions.
| (a) | The Parties acknowledge and agree that the Assets exclude the Excluded Assets and the Assumed Liabilities exclude the Excluded Liabilities. |
| (b) | The Seller covenants and agrees that in the event that (i) the Assets or other rights covered in this Bill of Sale cannot be transferred or assigned by it without the consent of or notice to a third party and in respect of which any necessary consent or notice has not as of the date hereof been given or obtained, or (ii) the Assets or rights are non-assignable by their nature and will not pass by this Bill of Sale, the beneficial interest in and to the same will in any event pass to the Buyer, as the case may be; and the Seller covenants and agrees (a) to hold, and hereby declares that it holds, such property, Assets or rights in trust for, and for the benefit of, the Buyer, (b) to cooperate with the Buyer in the Buyer’s efforts to obtain and to secure such consent and give such notice as may be required to effect a valid transfer or transfers of such Assets or rights, (c) to cooperate with the Buyer in any reasonable interim arrangement to secure for the Buyer the practical benefits of such Assets pending the receipt of the necessary consent or approval, and (d) to make or complete such transfer or transfers as soon as reasonably possible. Seller covenants and agrees to warrant and defend title to the Assets sold against any person, firm, corporation or association. |
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| (c) | Seller hereby constitutes and appoints Buyer, its successors and assigns, the true and lawful attorney and attorneys of Seller, with full power of substitution in the name and stead of Seller, but on behalf and for the benefit of Seller, its successors and assigns, to demand and receive any and all of the Assets hereby sold, conveyed, transferred, assigned and delivered to Buyer, and to give receipts and releases for same, and any part thereof, and from time to time to institute and prosecute in the name of Seller, or otherwise, for the benefit of Buyer, its successors or assigns, any and all proceedings at law, in equity or otherwise, that Buyer, its successors and assigns, may deem proper in order to collect or reduce to possession any of such Assets, or to enforce any claim or right of any kind in respect thereof, and to do all acts and things in relation to such Assets that Buyer, its successors and assigns, shall deem desirable, Seller hereby declaring that the foregoing powers are coupled with an interest and are not revocable and shall not be revoked by Seller. |
| (d) | Seller hereby agrees that from time to time, at the request of Buyer and without further consideration, it will, execute, acknowledge and deliver such further instruments of conveyance, transfer and assignment and will take any other action that Buyer reasonably deems necessary or proper to more effectively convey, transfer, and vest in Buyer all of Seller’s right, title, and interest in and to the Assets as set forth hereunder. |
| (e) | Any individual, partnership, corporation or other entity may rely, without further inquiry, upon the powers and rights herein granted to the Buyer and upon any notarization, certification, verification or affidavit by any notary public of any state relating to the authorization, execution and delivery of this Bill of Sale or to the authenticity of any copy, conformed or otherwise, hereof. |
| (f) | All of the terms and provisions of this Bill of Sale will be binding upon the Seller and its permitted successors and permitted assigns and will inure to the benefit of the Buyer and its permitted successors and permitted assigns. |
Article II. Miscellaneous.
Section 2.01 Construction. Unless the context of this Bill of Sale otherwise clearly requires, (a) references to the plural include the singular, and references to the singular include the plural, (b) references to any gender include the other genders, (c) the words “include,” “includes” and “including” do not limit the preceding terms or words and will be deemed to be followed by the words “without limitation”, (d) the term “or” has the inclusive meaning represented by the phrase “and/or”, (e) the terms “hereof”, “herein”, “hereunder”, “hereto” and similar terms in this Bill of Sale refer to this Bill of Sale as a whole and not to any particular provision of this Bill of Sale, (f) the terms “day” and “days” mean and refer to calendar day(s), (g) the terms “year” and “years” mean and refer to calendar year(s) and (h) the word “extent” in the phrase “to the extent” mean the degree to which a subject or other thing extends, and such phrase will not mean simply “if”. Unless otherwise set forth herein, references in this Bill of Sale to (i) any document, instrument or agreement (including this Bill of Sale) (A) includes and incorporates all exhibits, schedules and other attachments thereto, (B) includes all documents, instruments or agreements issued or executed in replacement thereof and (C) means such document, instrument or agreement, or replacement or predecessor thereto, as amended, modified or supplemented from time to time in accordance with its terms and in effect at any given time, and (ii) a particular Law (as hereinafter defined) means such Law as amended, modified, supplemented or succeeded, from time to time and in effect at any given time. All Article, Section, Exhibit and Schedule references herein are to Articles, Sections, Exhibits and Schedules of this Bill of Sale, unless otherwise specified. All accounting terms not specifically defined herein will be construed in accordance with GAAP. Unless otherwise set forth herein, the settlement of all payments hereunder will be made in Dollars. Where the term “made available” is used in this Bill of Sale, it means, with respect to any document or information, that the same has been made available or otherwise accessible to Buyer by means of the virtual data room established by the Seller not less than three (3) Business Days prior to the date of this Bill of Sale. The headings in this Bill of Sale are included for purposes of convenience only and shall not affect the construction or interpretation of any of its provisions
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Section 2.02 Entire Agreement; Amendment; Waiver. This Agreement and the other Transaction Documents constitute the entire agreement between the Parties pertaining to the subject matter contained herein and supersede all prior agreements, representations and understandings, both written and oral, of the Parties and the rights and remedies of the Parties with respect to the subject matter of this Bill of Sale will be governed by the express terms hereof. No supplement, modification or amendment of this Bill of Sale will be binding unless executed in writing by all of the Parties. No waiver of any of the provisions of this Bill of Sale will be deemed or will constitute a waiver of any other provision, whether or not similar, nor will any waiver constitute a continuing waiver. No waiver will be binding unless executed in writing by the Party making the waiver. This Bill of Sale will be binding on and will inure to the benefit of the Parties and their respective permitted legal representatives, heirs, permitted successors and permitted assigns.
Section 2.03 Third Party Beneficiaries. Other than as specifically set forth herein, neither this Bill of Sale nor any provision hereof confers any benefit or right upon or may be enforced by any Person not a signatory hereto and there are no third-party beneficiaries hereof.
Section 2.04 Investigation by Parties. No investigations made by or on behalf of any Party or any of their respective authorized agents at any time will have the effect of waiving, diminishing the scope of or otherwise affecting any representation, warranty or covenant made by any other Party in or pursuant to this Bill of Sale.
Section 2.05 Expenses. Except as otherwise specifically set forth herein or in the Agreement, each Party shall be responsible for its own costs, fees and expenses regarding this Bill of Sale or the Transactions, including all of the fees and expenses incurred by such Party in connection with the preparation, execution and delivery of this Bill of Sale and all of such Party’s legal, accounting and other professional fees.
Section 2.06 Notices. All notices hereunder shall be sent in accordance with the provisions of the Agreement.
Section 2.07 Governing Law. This Bill of Sale, and all matters based upon, arising out of or relating in any way to this Bill of Sale including, without limitation, tort claims, statutory claims and contract claims, shall be interpreted, construed, governed and enforced under and in accordance with the substantive and procedural Laws of the State of Delaware in each case as in effect from time to time and as the same may be amended from time to time, and as applied to agreements performed wholly within the State of Delaware.
Section 2.08 Jurisdiction.
ANY LEGAL SUIT, ACTION OR PROCEEDING ARISING OUT OF OR BASED UPON THIS BILL OF SALE OR THE TRANSACTIONS CONTEMPLATED HEREIN SHALL
BE INSTITUTED SOLELY IN THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA OR THE COURTS OF THE STATE OF MASSACHUSETTES, IN EACH
CASE LOCATED IN MIDDLESEX COUNTY, MASSACHUSETTES, AND EACH PARTY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF SUCH COURTS IN
ANY SUCH SUIT, ACTION OR PROCEEDING. SERVICE OF PROCESS, SUMMONS, NOTICE OR OTHER DOCUMENT BY MAIL TO SUCH PARTY’S ADDRESS SET
FORTH HEREIN SHALL BE EFFECTIVE SERVICE OF PROCESS FOR ANY SUIT, ACTION OR OTHER PROCEEDING BROUGHT IN ANY SUCH COURT. THE PARTIES IRREVOCABLY
AND UNCONDITIONALLY WAIVE ANY OBJECTION TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR ANY PROCEEDING IN SUCH COURTS AND IRREVOCABLY WAIVE
AND AGREE NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT
IN AN INCONVENIENT FORUM.
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Section 2.09 Waiver of Jury Trial. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS BILL OF SALE OR THE TRANSACTIONS, THE PERFORMANCE THEREOF OR THE FINANCINGS CONTEMPLATED THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS BILL OF SALE BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 2.09. EACH OF THE PARTIES ACKNOWLEDGE THAT EACH HAS BEEN REPRESENTED IN CONNECTION WITH THE SIGNING OF THE WAIVER ABOVE BY INDEPENDENT LEGAL COUNSEL SELECTED BY THE RESPECTIVE PARTY AND THAT SUCH PARTY HAS DISCUSSED THE LEGAL CONSEQUENCES AND IMPORT OF THIS WAIVER WITH LEGAL COUNSEL. EACH OF THE PARTIES FURTHER ACKNOWLEDGE THAT EACH HAS READ AND UNDERSTANDS THE MEANING OF SUCH WAIVER AND GRANTS THIS WAIVER KNOWINGLY, VOLUNTARILY, WITHOUT DURESS AND ONLY AFTER CONSIDERATION OF THE CONSEQUENCES OF THIS WAIVER WITH LEGAL COUNSEL.
Section 2.10 Specific Performance. Each Party acknowledges that the rights of each Party to consummate the Transactions are unique, recognizes and affirms that in the event of a breach of this Bill of Sale by any Party, money damages may be inadequate and the non-breaching Parties may have not adequate remedy at law, and agree that irreparable damage would occur in the event that any of the provisions of this Bill of Sale were not performed by an applicable Party in accordance with their specific terms or were otherwise breached. Accordingly, each Party shall be entitled to seek an injunction or restraining order to prevent breaches of this Bill of Sale and to seek to enforce specifically the terms and provisions hereof, without the requirement to post any bond or other security or to prove that money damages would be inadequate, this being in addition to any other right or remedy to which such Party may be entitled under this Bill of Sale, at law or in equity.
Section 2.11 No Consequential Damages. IN NO EVENT WILL ANY PARTY BE LIABLE TO ANY OTHER PARTY UNDER OR IN CONNECTION WITH THIS BILL OF SALE OR IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED HEREIN FOR SPECIAL, GENERAL, INDIRECT, CONSEQUENTIAL, OR PUNITIVE OR EXEMPLARY DAMAGES, INCLUDING DAMAGES FOR LOST PROFITS OR LOST OPPORTUNITY, EVEN IF THE PARTY SOUGHT TO BE HELD LIABLE HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGE.
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Section 2.12 Exhibits. All exhibits, schedules and attachments to this Bill of Sale and all exhibits, schedules and attachments thereto are hereby incorporated by reference into this Bill of Sale and hereby made a part hereof (whether or not physically attached hereto or thereto).
Section 2.13 Assignment. No Party may assign its rights or delegate its duties under this Bill of Sale without the prior written consent of the other Party, whether by operation of law or otherwise, and any attempted assignment in contravention of this provision shall be null and void and of no force or effect. This Bill of Sale will be binding upon and will inure to the benefit of the Parties and their respective permitted successors and permitted assigns, and any reference to a Party will also be a reference to the permitted successors and permitted assigns thereof.
Section 2.14 Severability. If any provision of this Bill of Sale is capable of two constructions, only one of which would render the provision valid, legal and enforceable, the provision will have the meaning which so renders it valid, legal and enforceable. If any provision of this Bill of Sale or the application of any provision hereof to any person or circumstance is determined to be invalid, unenforceable or illegal under present or future laws, such determination will not affect any other provision of this Bill of Sale or the application of such provision to any other person or circumstance, all of which will remain in full force and effect. If any provision of this Bill of Sale is deemed invalid, illegal or unenforceable, the Parties hereby agree to submit to as similar a provision as possible that is valid, legal and enforceable.
Section 2.15 No Recourse. No past, present or future director, officer, employee, incorporator, member, partner, stockholder, subsidiary, affiliate, controlling party, entity under common control, ownership or management, vendor, service provider, agent, attorney or representative of the Buyer or any of the Buyer’s Affiliates will have any liability for (a) any obligations or liabilities of the Buyer relating to or arising from this Bill of Sale or (b) any claim against the Buyer based on, in respect of, or by reason of, the Transactions. No past, present or future director, officer, employee, incorporator, member, partner, shareholder, subsidiary, affiliate, entity under common control, ownership or management, vendor, service provider, agent, attorney or representative of the Seller, Parent or Parent or any of the their respective Affiliates will have any liability for (x) any obligations or liabilities of Seller, Parent or Parent relating to or arising from this Bill of Sale or (y) any claim against the Seller, Parent or Parent based on, in respect of, or by reason of, the Transactions.
Section 2.16 Drafting. The Parties acknowledge and confirm that they and/or their respective attorneys have participated jointly in the review and revision of this Bill of Sale and that it has not been written solely by any one Party or counsel for any one Party. The Parties therefore stipulate and agree that the rule of construction to the effect that any ambiguities are to be or may be resolved against the drafting Party will not be employed in the interpretation of this Bill of Sale to favor any Party against another.
Section 2.17 Survival. The provisions of this Article II shall survive the Closing Date for a period of two years thereafter.
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Section 2.18 Counterparts; Copies. This Bill of Sale and any amendments hereto may be executed by the Parties in several counterparts, all of which together will constitute one agreement binding on all Parties, notwithstanding that all Parties may not have signed the same counterpart. This Bill of Sale and any amendments thereto may be executed by the Parties in several copies each of which will be deemed an original and it will not be necessary, when making proof of this Bill of Sale, to account for or produce more than one original of such copies. Any signature delivered by a Party by facsimile or PDF transmission will be deemed to be an original signature thereto.
[signatures follow on next page]
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IN WITNESS WHEREOF, the Parties have caused this Bill of Sale to be executed by their respective duly authorized officers as of the Closing Date.
| ConnectM Technology Solutions, Inc. | ||
| By: | /s/ Bhaskar Panigrahi | |
| Name: | Bhaskar Panigrahi | |
| Title: | Chief Executive Officer | |
| Amperics Holdings LLC | ||
| By: | /s/ Bala Padmakumar | |
| Name: | Bala Padmakumar | |
| Title: | Managing Partner | |
Exhibit 1 – Page 8
Exhibit 1
Assets
Assumed Contracts :
· QSolar – Under negotiation.
· Assigned Intellectual Property/Proprietary information
o - Proprietary technology related to
§ Pseucapacitors
§ Conductive Ink Formulations
§ Production techniques
§ Product specifications
· Single Supercapacitor Cells
· Supercapacitor Modules
· Hybrid modules
§ Marketing collateral
o Patents
Exhibit 1 – Page 1
| AMPERICS PORTFOLIO | ||||||||||||
| REF. # | TYPE | STATUS | SERIAL # | TITLE | FILING
DATE |
SOURCE | NOTES | CRITICAL DATE |
AGENTS | License | Tech ID | Atty Dkt |
| AMP01 | PCT | Filed | PCT/US2009/053527 | HIERARCHICAL NANOWIRE COMPOSITES FOR ELECTROCHEMICAL ENERGY STORAGE | 8/12/2009 | UCLA (Lu) | Conductive / Oxide Nanowire Interpenetrating Network | O'Banion (O'banion) | UCLA | 2009-058-2 | UC09-058-2FP | |
| P | Expired | 61/089,221 | Carbon nanotubes supported Vanadium oxide nanowire composites for electrochemical supercapacitor | 8/15/2008 | UCLA (Lu) | 8/15/2009 | Venable (Daley) | UCLA | 2009-058-2 | 58086-262775 | ||
| AMP02 | P | Filed | 61/232,899 | SUPERCAPACITORS WITH MULTIPLE NANOWIRE NETWORK ELECTRODES AND METHODS OF FABRICATING THE SAME | 8/11/2009 | Amperics | Asymmetric supercapacitor embodiments | 8/11/2010 | O'Banion (O'banion) | UC10-077-1 | ||
| AMP03 | PCT | Filed | PCT/US2009/055910 | CHARGE STORAGE DEVICE ARCHITECTURE FOR INCREASING ENERGY AND POWER DENSITY | 9/3/2009 | UCLA (Gruner) | Hybrid electrodes w/ EDLC and redox materials on contact w/ electrolyte & CC | O'Banion (O'banion) | UCLA | UC09-086-2FP | ||
| P | Expired | 61/094,353 | Charge Storage Device Architecture for Increased Energy and Power Density | 9/4/2008 | UCLA (Gruner) | 9/4/2009 | UCLA | 2009-086-1 | ||||
| AMP04 | NP | Filed | 12/576,937 | CHARGE STORAGE DEVICES CONTAINING CARBON NANOTUBE FILMS AS ELECTRODES AND CHARGE COLLECTORS | 10/9/2009 | UCLA (Gruner) | O'Banion (O'banion) | UCLA | UC07-520-2US | |||
| PCT | Expired | PCT/US2008/004593 | CHARGE STORAGE DEVICES CONTAINING CARBON NANOTUBE FILMS AS ELECTRODES AND CHARGE COLLECTORS | 4/10/2008 | UCLA (Gruner) | Venable (Daley) | UCLA | 2007-520-1 | UC07-520 | |||
| P1 | Expired | 60/907,587 | 4/10/2007 | UCLA (Gruner) | ||||||||
| P2 | Expired | 60/929,809 | 7/13/2007 | UCLA (Gruner) | ||||||||
| AMP05 | P | Filed | 61/143,653 | Charge Storage Device Architecture for Increased Energy and Power Density | 1/9/2009 | UCLA (Dunn) | Nanoparticle electrodes with tailored pore size | 1/11/2010 | O'Banion (O'banion) | UCLA | UC09-392-1 | |
| AMP06 | P | Expired | 61/260,217 | HIERARCHICAL CARBON MONOLITH SUPERCAPACITOR | 11/11/2009 | Madrid (del Monte) | HCMs with tailored bimodal pore size | 11/11/2010 | Catalyst IP Group | |||
| AMP07 | NP | Filed | 13/079,773 | TERNARY OXIDE SUPERCAPACITOR ELECTRODES | 4/4/2011 | Amperics | Ternary oxide electrodes | Catalyst IP Group | ||||
| P | Expired | 61/320703 | TERNARY OXIDE SUPERCAPACITOR ELECTRODES | 4/3/2010 | Amperics | Ternary oxide electrodes | 4/3/2011 | Catalyst IP Group | ||||
| AMP08 | NP | Filed | 13/089,299 | CHARGE STORAGE DEVICE ARCHITECTURE FOR INCREASING ENERGY AND POWER DENSITY | 4/18/2011 | Amperics | Three- component electrode (CNT, oxide, activated carbon composite structure) | Catalyst IP Group | ||||
| P | Expired | 61/325326 | CHARGE STORAGE DEVICE ARCHITECTURE FOR INCREASING ENERGY AND POWER DENSITY | 4/18/2010 | Amperics | Three- component electrode (CNT, oxide, activated carbon composite structure) | 4/18/2011 | Catalyst IP Group | ||||
Exhibit 1 – Page 2
Exhibit 2.3
Exchange and Acquisition Agreement
BY AND AMONG
ConnectM Technology Solutions, Inc.;
ConnectM India Pvt Ltd.;
Geo Impex LLC;
Global Impex LLC;
Geo Impex & Logistics Pvt Ltd.;
AND
Marsh CDM Services Pvt Ltd.
Table of Contents
| Article I. Definitions and Interpretation | 2 | |
| Section 1.01 | Defined Terms | 2 |
| Section 1.02 | Interpretation | 5 |
| Article II. The Transactions | 6 | |
| Section 2.01 | Exchanges and Acquisitions | 6 |
| Section 2.02 | Closing | 6 |
| Section 2.03 | Closing Deliverables | 7 |
| Section 2.04 | Directors and Officers at the Closing | 8 |
| Section 2.05 | Adjustments for Stock Splits | 8 |
| Article III. Conditions Precedent to the Closing | 8 | |
| Section 3.01 | Conditions to the Obligations of the ConnectM Parties | 8 |
| Section 3.02 | Conditions to the Obligations of the Geo Impex Parties | 10 |
| Article IV. Representations and Warranties of the Geo Impex Parties | 10 | |
| Section 4.01 | Organization and Qualification | 10 |
| Section 4.02 | Organizational Documents | 11 |
| Section 4.03 | Authorization of Agreement; Etc. | 11 |
| Section 4.04 | No Conflict | 12 |
| Section 4.05 | Global Impex Equity Interests | 12 |
| Section 4.06 | Geo Impex India Equity Interests | 12 |
| Section 4.07 | Accredited Investor; Etc. | 13 |
| Section 4.08 | No Operations | 15 |
| Section 4.09 | Liabilities | 15 |
| Section 4.10 | Litigation and Proceedings | 15 |
| Section 4.11 | General Compliance | 15 |
| Section 4.12 | Compliance with Laws; Permits | 16 |
| Section 4.13 | Contracts | 16 |
| Section 4.14 | Bank Accounts; Power of Attorney | 17 |
| Section 4.15 | Disclosure | 17 |
| Section 4.16 | Intellectual Property | 17 |
| Section 4.17 | Condition and Sufficiency of Assets | 18 |
| Section 4.18 | Accounts Receivable | 18 |
| Section 4.19 | Title | 18 |
| Section 4.20 | Insurance | 19 |
| Section 4.21 | Taxes | 19 |
| Section 4.22 | Transactions with Affiliates | 20 |
| Section 4.23 | Foreign Corrupt Practices | 21 |
| Section 4.24 | Money Laundering | 21 |
| Section 4.25 | Illegal or Unauthorized Payments; Political Contributions | 21 |
| Section 4.26 | Environmental Laws | 21 |
| Section 4.27 | Investment Company | 21 |
| Section 4.28 | No Disqualification Events | 22 |
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| Section 4.29 | No Brokers | 22 |
| Section 4.30 | Disclosure | 22 |
| Article V. Representations and Warranties of the ConnectM Parties | 22 | |
| Section 5.01 | Organization | 22 |
| Section 5.02 | Power and Authority | 23 |
| Section 5.03 | Authorization of Agreement; Etc. | 23 |
| Section 5.04 | No Conflict | 23 |
| Section 5.05 | Approval of Agreement and of Issuance of Shares | 23 |
| Section 5.06 | No Brokers | 23 |
| Section 5.07 | Disclosure | 23 |
| Article VI. Covenants and Additional Agreements of the Parties | 24 | |
| Section 6.01 | Notices of Certain Events | 24 |
| Section 6.02 | Access to Information | 24 |
| Section 6.03 | Consents of Third Parties | 24 |
| Section 6.04 | No-Shop | 24 |
| Section 6.05 | Affirmative Covenants | 25 |
| Section 6.06 | Negative Covenants | 26 |
| Section 6.07 | Effect of Knowledge on Indemnification | 27 |
| Section 6.08 | Further Assurances | 28 |
| Article VII. Termination | 28 | |
| Section 7.01 | Termination | 28 |
| Section 7.02 | Effect of Termination | 28 |
| Section 7.03 | Default by ConnectM Parties | 28 |
| Section 7.04 | Default by Geo Impex Parties | 29 |
| Article VIII. Survival; Indemnification | 29 | |
| Section 8.01 | Survival | 29 |
| Section 8.02 | Indemnification by Geo Impex | 29 |
| Section 8.03 | Indemnification by ConnectM | 30 |
| Section 8.04 | Indemnification Procedures | 30 |
| Section 8.05 | Payments | 32 |
| Section 8.06 | Certain Limitations | 32 |
| Section 8.07 | Tax Treatment of Indemnification Payments | 32 |
| Section 8.08 | Effect of Investigation | 32 |
| Section 8.09 | Exclusive Remedy | 33 |
| Article IX. Miscellaneous | 33 | |
| Section 9.01 | Notices | 33 |
| Section 9.02 | Governing Law | 34 |
| Section 9.03 | Jurisdiction | 34 |
| Section 9.04 | Waiver of Jury Trial | 35 |
| Section 9.05 | Specific Performance | 35 |
| Section 9.06 | Limitation on Damages | 35 |
| Section 9.07 | Attorneys’ Fees | 35 |
| Section 9.08 | Public Announcements and Filings | 35 |
| Section 9.09 | Third-Party Beneficiaries | 36 |
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| Section 9.10 | Expenses | 36 |
| Section 9.11 | Entire Agreement | 36 |
| Section 9.12 | Construction | 36 |
| Section 9.13 | Amendment or Waiver | 36 |
| Section 9.14 | Commercially Reasonable Efforts | 37 |
| Section 9.15 | Successors and Assigns | 37 |
| Section 9.16 | Counterparts | 37 |
Exhibits
| Exhibit A | Promissory Note |
| Exhibit B | Assignment of Membership Interests |
| Exhibit C | Stock Power for Marsh CDM/Geo Impex India Shares1 |
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Exchange And Acquisition Agreement
Dated as of 3rd November 2025
This Exchange and Acquisition Agreement (this “Agreement”) is entered into as of the date first set forth above (the “Effective Date”), by and among (i) ConnectM Technology Solutions, Inc., a Delaware corporation (“ConnectM”); (ii) ConnectM India Pvt Ltd., an Indian private limited company and a wholly owned subsidiary of ConnectM (“ConnectM India”); (iii) Geo Impex LLC, a Delaware limited liability company (“Geo Impex”); (iv) Global Impex LLC, a Delaware limited liability company (“Global Impex”), (v) Geo Impex & Logistics Pvt Ltd., an Indian private limited company (“Geo Impex India”); and (vi) Marsh CDM Services Pvt Ltd., an Indian private limited company (“Marsh CDM”). Each of Connect M and ConnectM India may be referred to herein collectively as the “ConnectM Parties” and each individually as a “ConnectM Party”. Each of Geo Impex, Global Impex, Geo Impex India and Marsh CDM may be referred to herein collectively as the “Geo Impex Parties” and each individually as a “Geo Impex Party”. Each of the ConnectM Parties and the Geo Impex Parties may be referred to herein collectively as the “Parties” and each individually as a “Party.”
Recitals:
WHEREAS, Geo Impex is the sole member of Global Impex, holding 100% of the membership interests of Global Impex, being comprised of [units, etc.]2 (the “Membership Interests”);
WHEREAS, Global Impex is a holder of shares of [common stock]3 of Geo Impex India (the “Geo Impex India Shares”), being the registered and beneficial holder of 5,574,005 Geo Impex India Shares, representing 48.01% of the equity interests of Geo Impex India;
WHEREAS, ConnectM desires to acquire from Geo Impex all of the Membership Interests, in exchange for the issuance to Geo Impex of certain shares of common stock, par value $0.0001 per share, of ConnectM (the “Common Stock”);
WHEREAS, Geo Impex is the sole shareholder of Marsh CDM, and Marsh CDM is the registered and beneficial holder of 4,436,111 Geo Impex India Shares, representing 38.21% of the equity interests of Geo Impex India (the “Marsh CDM/Geo Impex India Shares”);
WHEREAS, ConnectM India desires to acquire from Marsh CDM all of the Marsh CDM/Geo Impex India Shares, in exchange for the issuance by ConnectM India to Marsh CDM of a promissory note of ConnectM India;
WHEREAS the transactions as set forth above and in this Agreement overall are referred to collectively, as the “Transactions”);
WHEREAS, this Agreement is being entered into for the purpose of setting forth the terms and conditions of the Transactions;
NOW THEREFORE, on the stated premises and for and in consideration of the mutual covenants and agreements hereinafter set forth and the mutual benefits to the Parties to be derived here from, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and intending to be legally bound hereby, the Parties hereby agree as follows:
Article I. Definitions And Interpretation
Section 1.01 Defined Terms. In addition to the other terms defined herein, for purposes of this Agreement, the following terms shall have the following meanings:
| (a) | “Acquisition Inquiry” means an inquiry, indication of interest or request for nonpublic information that could reasonably be expected to lead to an Acquisition Proposal. |
| (b) | “Acquisition Transaction” means any transaction or series of related transactions with a Person or “group” (as defined in the Exchange Act and the rules promulgated thereunder) concerning any (i) merger, consolidation, business combination, share exchange, joint venture or similar transaction involving any Geo Impex Party pursuant to which such Person or “group” would own 5% or more of the consolidated assets, revenues or net income of any Geo Impex Party, (ii) sale, lease, license or other disposition directly or indirectly by merger, consolidation, business combination, share exchange, joint venture or otherwise, of assets of any Geo Impex Party representing 5% or more of the consolidated assets, revenues or net income of any Geo Impex Party, (iii) issuance or sale or other disposition (including by way of merger, consolidation, business combination, share exchange, joint venture or similar transaction) of any Equity Securities of any Geo Impex Party, (iv) transaction or series of transactions in which any Person or “group would acquire beneficial ownership of, right, title or interest in, or the right to acquire beneficial ownership of, any Equity Securities of any Geo Impex Party, including without limitation any of shares of Geo Impex India held by Global Impex or the Marsh CDM/Geo Impex India Shares, (v) action to make the provisions of any “fair price”, “moratorium”, “control share acquisition”, “business combination” or other similar anti-takeover statute or regulation inapplicable to any transaction, or (vi) any combination of any of the foregoing. |
| (c) | “Action” means any claim, action, cause of action, demand, lawsuit, arbitration, inquiry, audit, notice of violation, proceeding, litigation, citation, summons, subpoena or investigation of any nature, civil, criminal, administrative, regulatory or otherwise, whether at law or in equity. |
| (d) | “Affiliate” of a Person means any other Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such Person, and the term “control” (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by Contract or otherwise. |
| (e) | “Board of ConnectM” means the Board of Directors of Connect M. |
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| (f) | “Business Day” shall mean any day on which commercial banks are generally open for business in Delaware. |
| (g) | “Contracts” means all contracts, leases, deeds, mortgages, licenses, instruments, notes, commitments, undertakings, indentures, joint ventures and all other agreements, commitments and legally binding arrangements, whether written or oral. |
| (h) | “Derivatives” means any options, warrants, convertible securities or other rights, agreements, arrangements or commitments of any character relating to the Equity Securities of Global Impex or obligating Global Impex to issue or sell any of its Equity Securities. |
| (i) | “Encumbrance” means any charge, claim, community property interest, pledge, condition, equitable interest, lien (statutory or other), option, security interest, mortgage, easement, encroachment, right of way, right of first refusal, or restriction of any kind, including any restriction on use, voting, transfer, receipt of income or exercise of any other attribute of ownership in the amount of $1,000 or more. |
| (j) | “Enforceability Exceptions” means (a) applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and other similar Laws of general application affecting enforcement of creditors’ rights generally and (b) general principles of equity. |
| (k) | “Equity Security” means, in respect of any Person, (a) any capital stock or similar security, (b) any security convertible into or exchangeable for any security described in clause (a), (c) any option, warrant, or other right to purchase or otherwise acquire any security described in clauses (a), (b), or (c), and, (d) any “equity security” within the meaning of the Exchange Act. |
| (l) | “Exchange Act” means the Securities Exchange Act of 1934, as amended. |
| (m) | “GAAP” means United States generally accepted accounting principles as in effect from time to time. |
| (n) | “Governmental Authority” means any federal, state, local or foreign government or political subdivision thereof, or any agency or instrumentality of such government or political subdivision, or any self-regulated organization or other non-governmental regulatory authority or quasi-governmental authority (to the extent that the rules, regulations or orders of such organization or authority have the force of Law), or any arbitrator, court or tribunal of competent jurisdiction. |
| (o) | “Governmental Authorization” means any (a) consent, license, registration, or permit issued, granted, given, or otherwise made available by or under the authority of any Governmental Authority or pursuant to any Law; or (b) right under any Contract with any Governmental Authority. |
| (p) | “Governmental Order” means any order, writ, judgment, injunction, decree, stipulation, determination or award entered by or with any Governmental Authority. |
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| (q) | “Intellectual Property” means all of the following and similar intangible property and related proprietary rights, interests and protections, however arising, pursuant to the Laws of any jurisdiction throughout the world: (i) trademarks, service marks, trade names, brand names, logos, trade dress and other proprietary indicia of goods and services, whether registered or unregistered, and all registrations and applications for registration of such trademarks, including intent-to-use applications, all issuances, extensions and renewals of such registrations and applications and the goodwill connected with the use of and symbolized by any of the foregoing; (ii) internet domain names, whether or not trademarks, registered in any top-level domain by any authorized private registrar or Governmental Authority; (iii) original works of authorship in any medium of expression, whether or not published, all copyrights (whether registered or unregistered), all registrations and applications for registration of such copyrights, and all issuances, extensions and renewals of such registrations and applications; (iv) confidential information, formulas, designs, devices, technology, know-how, research and development, inventions, methods, processes, compositions and other trade secrets, whether or not patentable; and (v) patented and patentable designs and inventions, all design, plant and utility patents, letters patent, utility models, pending patent applications and provisional applications and all issuances, divisions, continuations, continuations-in-part, reissues, extensions, reexaminations and renewals of such patents and applications. |
| (r) | “INR” means Indian Rupees. |
| (s) | “Knowledge of Geo Impex” means the actual knowledge, assuming due inquiry, of any director, manager or executive officer of any Geo Impex Party. |
| (t) | “Law” means any statute, law, ordinance, regulation, rule, code, order, constitution, treaty, common law, judgment, decree, other requirement or rule of law of any Governmental Authority. |
| (u) | “Losses” means losses, damages, liabilities, deficiencies, Actions, judgments, interest, awards, penalties, fines, costs or expenses of whatever kind, including reasonable attorneys’ fees and the cost of enforcing any right to indemnification hereunder and the cost of pursuing any insurance providers; provided, however, that “Losses” shall not include (i) punitive damages, except in the case of fraud or to the extent actually awarded to a Governmental Authority or other third party or (ii) lost profits or consequential damages, in any case. |
| (v) | “Material Adverse Effect” means any event, occurrence, fact, condition or change that is, or could reasonably be expected to become, individually or in the aggregate, materially adverse to (a) the business, results of operations, condition (financial or otherwise) or assets of the affected Party, or (b) the ability of the affected Party to consummate the Transactions on a timely basis; provided, however, that “Material Adverse Effect” shall not include any event, occurrence, fact, condition, or change, directly or indirectly, arising out of or attributable to: (i) any changes, conditions or effects in the United States economy or securities or financial markets in general; (ii) changes, conditions or effects that generally affect the industries in which the affected Party operates; (iii) any change, effect or circumstance resulting from an action required or permitted by this Agreement; or (iv) conditions caused by acts of terrorism or war (whether or not declared); provided further, however, that any event, occurrence, fact, condition, or change referred to in clauses (i), (ii) or (iv) immediately above shall be taken into account in determining whether a Material Adverse Effect has occurred to the extent that such event, occurrence, fact, condition, or change has a disproportionate effect on the affected Party compared to other participants in the industries in which the affected Party conducts its business. |
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| (w) | “Ordinary Course of Business” means an action which is taken in the ordinary course of the normal day-to-day operations of the Person taking such action consistent with the past practices of such Person, is not required to be authorized by the board of directors of such Person (or by any Person or group of Persons exercising similar authority) and is similar in nature and magnitude to actions customarily taken, without any authorization by the board of directors (or by any Person or group of Persons exercising similar authority), in the ordinary course of the normal day-to-day operations of other Persons that are in the same line of business as such Person. |
| (x) | “Organizational Documents”, as to any Person, means the Certificate of Incorporation, Articles of Incorporation, Bylaws, Certificate of Formation, Operating Agreement, Shareholders’ Agreement and other similar or constating or operative entity documents of such Person, as applicable. |
| (y) | “Permits” means all permits, licenses, franchises, approvals, authorizations, registrations, certificates, variances and similar rights obtained, or required to be obtained, from Governmental Authorities. |
| (z) | “Person” means an individual, corporation, partnership, joint venture, limited liability company, Governmental Authority, unincorporated organization, trust, association or other entity. |
| (aa) | “Representative” means, with respect to any Person, any and all directors, officers, employees, consultants, financial advisors, counsel, accountants and other agents of such Person. |
| (bb) | “Tax Return” means any return, declaration, report, claim for refund, information return or statement or other document relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof. |
| (cc) | “Taxes” means all federal, state, local, foreign and other income, gross receipts, sales, use, production, ad valorem, transfer, franchise, registration, profits, license, lease, service, service use, withholding, payroll, employment, unemployment, estimated, excise, severance, environmental, stamp, occupation, premium, property (real or personal), real property gains, windfall profits, customs, duties or other taxes, fees, assessments or charges of any kind whatsoever, together with any interest, additions or penalties with respect thereto and any interest in respect of such additions or penalties. |
Section 1.02 Interpretation. Unless the express context otherwise requires (i) the words “hereof,” “herein,” and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provision of this Agreement; (ii) terms defined in the singular shall have a comparable meaning when used in the plural, and vice versa; (iii) the terms “Dollars” and “$” mean United States Dollars; (iv) references herein to a specific Section, Subsection, Recital or Exhibit shall refer, respectively, to Sections, Subsections, Recitals or Exhibits of this Agreement; (v) wherever the word “include,” “includes,” or “including” is used in this Agreement, it shall be deemed to be followed by the words “without limitation”; (vi) references herein to any gender shall include each other gender; (vii) references herein to any Person shall include such Person’s heirs, executors, personal Representatives, administrators, successors and assigns; provided, however, that nothing contained in this Section 1.02 is intended to authorize any assignment or transfer not otherwise permitted by this Agreement; (viii) references herein to a Person in a particular capacity or capacities shall exclude such Person in any other capacity; (ix) references herein to any Contract or agreement (including this Agreement) mean such Contract or agreement as amended, supplemented or modified from time to time in accordance with the terms thereof; (x) with respect to the determination of any period of time, the word “from” means “from and including” and the words “to” and “until” each means “to but excluding”; (xi) references herein to any Law or any license mean such Law or license as amended, modified, codified, reenacted, supplemented or superseded in whole or in part, and in effect from time to time; and (xii) references herein to any Law shall be deemed also to refer to all rules and regulations promulgated thereunder.
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Article II. The Transactions
Section 2.01 Exchanges and Acquisitions.
| (a) | On the terms and subject to the conditions set forth in this Agreement, at the Closing (as defined below): |
| (i) | Geo Impex shall sell, assign, transfer and deliver to ConnectM, free and clear of all security interests, liens, pledges, encumbrances, charges, restrictions or known claims of any kind, nature, or description, all of the Membership Interests; and |
| (ii) | Marsh CDM shall sell, assign, transfer and deliver to ConnectM India, free and clear of all security interests, liens, pledges, encumbrances, charges, restrictions or known claims of any kind, nature, or description, all of the Marsh CDM/Geo Impex India Shares. |
| (b) | In consideration for the acquisition of the Membership Interests pursuant to Section 2.01(a)(i), at the Closing, ConnectM shall issue to Geo Impex, subject to the provisions of Section 2.05, Thirty Three Million Three Hundred Thousand (33,300,000) shares of Common Stock (the “Exchange Shares”). |
| (c) | In consideration for the acquisition of the Marsh CDM/Geo Impex India Shares pursuant to Section 2.01(a)(ii), at the Closing, ConnectM India shall issue and deliver to Marsh CDM a promissory note of ConnectM India in the initial principal amount of INR 70,000,000, which promissory note shall be substantially in the form as attached hereto as Exhibit A (the “Note”). |
| (d) | Geo Impex shall be responsible for the payment of any and all Taxes that may be imposed on Geo Impex pursuant to the Transactions, including, without limitation, as a result of the receipt of the Exchange Shares or the Note. |
Section 2.02 Closing. The closing of the Transactions as set forth in Section 2.01 (the “Closing”) shall occur on the third Business Day (as defined below) following the satisfaction, or waiver by the Party or Parties for whose benefit the condition(s) exist, of the conditions to closing as set forth in Article III, or such or such other date as the Parties shall agree (such date, the “Closing Date”).
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Section 2.03 Closing Deliverables.
| (a) | At the Closing, ConnectM, on behalf of itself and ConnectM India, shall: |
| (i) | Deliver to Geo Impex an Assignment of Membership Interests, in the form as attached hereto as Exhibit B (the “Assignment”) duly executed by an authorized officer of ConnectM; |
| (ii) | Record Geo Impex in the books and records of ConnectM as the beneficial owner of the Exchange Shares (which Exchange Shares shall be recorded in book entry form and shall not be certificated); |
| (iii) | Deliver to Marsh CDM a copy of the Note, duly executed by an authorized officer of ConnectM India; |
| (iv) | Deliver to Geo Impex a certificate of the Secretary of ConnectM, dated as of the Closing Date, in form and substance satisfactory to Geo Impex, certifying that the matters set forth in Section 3.02(a) are true and correct; and |
| (v) | Deliver to Geo Impex such other documents as Geo Impex may reasonably request for the purpose of evidencing the accuracy of the ConnectM Parties’ representations and warranties; evidencing the performance by the ConnectM Parties of, or the compliance by the ConnectM Parties with, any covenant or obligation required to be performed or complied with by any of the ConnectM Parties; or otherwise facilitating the consummation or performance of any of the Transactions. |
| (b) | At the Closing, Geo Impex, on behalf of itself and the other Geo Impex Parties, shall deliver to ConnectM: |
| (i) | a certificate of a duly authorized officer of each Geo Impex Party dated as of the Closing Date, in form and substance satisfactory to ConnectM (A) certifying the name, title and true signature of each officer of each Geo Impex Party executing or authorized to execute this Agreement, the Transaction Documents, and such other documents, instruments and certifications required or contemplated hereby or thereby, (B) attaching and certifying (i) a true, correct and complete copy of Organizational Documents of each Geo Impex Party as of the Closing, certified by the applicable Governmental Authority, and (ii) a certificate of good standing and legal existence of each Geo Impex Party issued by the applicable Governmental Authority, and each dated as of a date no earlier than three Business Days prior to the Closing Date; and (C) certifying that the matters set forth in Section 3.01(a), Section 3.01(b) and Section 3.01(e) are true and correct; |
| (ii) | the Assignment duly executed by an authorized officer or manager of Geo Impex, sufficient to transfer the Membership Interests to ConnectM; |
| (iii) | A copy of the Note, duly executed by an authorized officer of Marsh CDM; |
| (iv) | A stock power in the form as attached hereto as Exhibit C, or such other instruments of transfer as required to transfer the Marsh CDM/Geo Impex India Shares to ConnectM India, duly executed by an authorized officer of Marsh CDM; |
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| (v) | Reasonable evidence of completion of the actions as set forth in Section 2.04; and |
| (vi) | such other documents as ConnectM may reasonably request for the purpose of evidencing the accuracy of the Geo Impex Parties’ representations and warranties; evidencing the performance by the Geo Impex Parties of, or the compliance by the Geo Impex Parties with, any covenant or obligation required to be performed or complied with by any of the Geo Impex Parties; or otherwise facilitating the consummation or performance of any of the Transactions. |
| (c) | At and following the Closing, each of the Parties shall execute, acknowledge, and deliver (or shall ensure to be executed, acknowledged, and delivered), any and all certificates, financial statements, schedules, agreements, resolutions, rulings or other instruments required by this Agreement to be so delivered at or prior to the Closing, together with such other items as may be reasonably requested by the Parties hereto and their respective legal counsel in order to effectuate or evidence Transactions as set forth in Section 2.01. |
Section 2.04 Directors and Officers at the Closing. At the Closing, the Parties shall undertake such actions as required to cause the [Board] of Geo Impex India to be comprised of [3] persons nominated by ConnectM India, to be [Board of Directors], and to name those persons to the positions as officers and directors of Geo Impex India as determined by ConnectM India, and all other current directors and officers of Geo Impex India shall resign.
Section 2.05 Adjustments for Stock Splits. The number of Exchange Shares as to be issued to Geo Impex at the Closing as set forth in Section 2.01(b) shall be equitably adjusted for any forward stock split or reverse stock split of the Common Stock occurring following the Effective Date and prior to the Closing. By way of example and not limitation in the event that following the Effective Date and prior to the Closing, ConnectM undertakes a 2-for-1 forward split of the Common Stock, wherein each share of Common Stock is split into two shares of Common Stock, the number of Exchange Shares as set forth in Section 2.01(b) shall be increased by 100%, and in the event that following the Effective Date and prior to the Closing ConnectM undertakes a 1-for-2 reverse split of the Common Stock, wherein each two shares of Common Stock are combined into one share of Common Stock, the number of Exchange Shares as set forth in Section 2.01(b) shall be reduced by 50%. The adjustments as set forth in this Section 2.05 shall be undertaken each time that a transaction as set forth in this Section 2.05 is consummated following the Effective Date and prior to the Closing.
Article III. Conditions Precedent To The Closing
Section 3.01 Conditions to the Obligations of the ConnectM Parties. The obligations of ConnectM and ConnectM India to consummate the Closing are subject to the satisfaction, or waiver by ConnectM in its sole discretion, as of and on the Closing Date, of the following conditions:
| (a) | Accuracy of Representations and Performance of Covenants. Each of the representations and warranties made by the Geo Impex Parties herein shall be true and correct in all material respects, other than representations and warranties which are qualified by materiality and the representations and warranties as set forth in Section 4.01, Section 4.03, Section 4.05, Section 4.06 and Section 4.07, each of which shall be true and correct in all respect, in each case, as of the Closing Date as if made on such date, and each of the Geo Impex Parties shall have performed or complied with all covenants and conditions required by this Agreement to be performed or complied with by it prior to or at the Closing. |
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| (b) | No Material Adverse Effect. There shall not have occurred any Material Adverse Effect with respect to any of the Geo Impex Parties since the Effective Date. |
| (c) | Due Diligence Review. ConnectM shall have completed its due diligence review and examination of the Geo Impex Parties, the Membership Interests and the Marsh CDM/Geo Impex India Shares, in each case to its satisfaction in its sole discretion. |
| (d) | No Governmental Prohibition. No order, statute, rule, regulation, executive order, injunction, stay, decree, judgment or restraining order shall have been enacted, entered, promulgated or enforced by any court or governmental or regulatory authority or instrumentality that prohibits the consummation of Transactions, and ConnectM shall have obtained the approval of any Governmental Authorities, and of any securities exchange or securities market on which the securities of ConnectM are listed or available for trading, as required in order to consummate the Transactions. |
| (e) | Consents. All consents, approvals, waivers or amendments pursuant to all Contracts, licenses, Permits, trademarks and other intangibles in connection with the Transactions, or required for the Closing to occur, or for the continued operation of Geo Impex India after the Closing Date on the basis as presently operated, shall have been obtained. |
| (f) | Stockholder Approval. If determined to be required by the ConnectM Board in its sole discretion, the consent of the stockholders of ConnectM for this Agreement and the consummation of the Transactions shall have been obtained and shall be remaining in full force and effect. |
| (g) | Financial Statements. Geo Impex shall have delivered to ConnectM audited financial statements of Global Impex and of Geo Impex India for the years ended December 31, 2024 and 2023, including balance sheets at December 31, 2024 and 2023, prepared in accordance with GAAP, together with a report of the auditors of Global Impex and of Geo Impex India thereon, and such interim financial statements, in such form that will to enable ConnectM, to file a Form 8-K with the SEC reporting the acquisition of Global Impex and of shares of Geo Impex India in accordance with the applicable requirements of the Exchange Act. |
| (h) | Absence of Litigation. There shall be no actions, suits, proceedings or governmental investigations or inquiries pending or, to any Party’s knowledge, threatened against any Party which would prevent or materially and adversely affect the consummation of the Transactions. |
| (i) | Other Items. ConnectM shall have received further documents, certificates, or instruments relating to Transactions as it may reasonably request, and such information regarding the Geo Impex Parties and their operations as ConnectM shall deem reasonably necessary for inclusion in the reports to be filed by ConnectM with the SEC. |
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Section 3.02 Conditions to the Obligations of the Geo Impex Parties. The obligations of the Geo Impex Parties to consummate the Closing are subject to the satisfaction, or waiver by Geo Impex in its sole discretion, as of and on the Closing Date, of the following conditions:
| (a) | Accuracy of Representations and Performance of Covenants. Each of the representations and warranties made by the ConnectM Parties herein shall be true and correct in all material respects, other than representations and warranties which are qualified by materiality, each of which shall be true and correct in all respect, in each case, as of the Closing Date as if made on such date, and each of the ConnectM Parties shall have performed or complied with all covenants and conditions required by this Agreement to be performed or complied with by it prior to or at the Closing |
| (b) | No Governmental Prohibition. No order, statute, rule, regulation, executive order, injunction, stay, decree, judgment or restraining order shall have been enacted, entered, promulgated or enforced by any court or governmental or regulatory authority or instrumentality that prohibits the consummation of Transactions. |
| (c) | Absence of Litigation. There shall be no actions, suits, proceedings or governmental investigations or inquiries pending or, to any Party’s knowledge, threatened against any Party which would prevent or materially and adversely affect the consummation of the Transactions. |
| (d) | Other Items. Geo Impex shall have received further documents, certificates, or instruments relating to Transactions as it may reasonably request. |
Article IV. Representations And Warranties Of The Geo Impex Parties
As an inducement to the consummation of the Transactions, the Geo Impex Parties, jointly and severally, represent and warrant to the ConnectM Parties, except as set forth in the schedules of exceptions to the representations of Global Impex Parties as delivered to ConnectM on the Effective Date (“Disclosure Schedules”), as of the Effective Date and the Closing Date, as follows:
Section 4.01 Organization and Qualification.
| (a) | Geo Impex is a limited liability company, duly organized, validly existing, and in good standing under the Laws of the State of Delaware and has the power and is duly authorized under all applicable Laws, regulations, ordinances and orders of public authorities, to carry on its business in all material respects as it is now being conducted. Geo Impex has not qualified to do business in any State other than Delaware. To the Knowledge of Geo Impex, no proceeding has been instituted in any jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail the power and authority or qualification of Geo Impex within such jurisdiction. |
| (b) | Global Impex is a limited liability company, duly organized, validly existing, and in good standing under the Laws of the State of Delaware and has the power and is duly authorized under all applicable Laws, regulations, ordinances and orders of public authorities, to carry on its business in all material respects as it is now being conducted. Global Impex has not qualified to do business in any State other than Delaware. To the Knowledge of Geo Impex, no proceeding has been instituted in any jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail the power and authority or qualification of Global Impex within such jurisdiction. |
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| (c) | Marsh CDM is a private limited company, duly organized, validly existing, and in good standing under the Laws of India and has the power and is duly authorized under all applicable Laws, regulations, ordinances and orders of public authorities, to carry on its business in all material respects as it is now being conducted. Marsh CDM has not qualified to do business in any jurisdiction other than India. To the Knowledge of Geo Impex, no proceeding has been instituted in any jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail the power and authority or qualification of Marsh CDM within such jurisdiction. |
| (d) | Geo Impex India is a private limited company, duly organized, validly existing, and in good standing under the Laws of India and has the power and is duly authorized under all applicable Laws, regulations, ordinances and orders of public authorities, to carry on its business in all material respects as it is now being conducted. Geo Impex India has not qualified to do business in any jurisdiction other than India. To the Knowledge of Geo Impex, no proceeding has been instituted in any jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail the power and authority or qualification of Geo Impex India within such jurisdiction. |
Section 4.02 Organizational Documents.
| (a) | The Certificate of Formation and limited liability company operating agreement of Geo Impex (collectively, the “Geo Impex Organizational Documents”) are set forth in Section 4.02(a) of Disclosure Schedules. Geo Impex has taken all actions required by Laws, the Geo Impex Organizational Documents, or otherwise to authorize the execution and delivery of this Agreement. Geo Impex has full power, authority, and legal capacity to execute this Agreement and to consummate the Transactions. |
| (b) | The Certificate of Formation and limited liability company operating agreement of Global Impex (collectively, the “Global Impex Organizational Documents”) are set forth in Section 4.02(b) of Disclosure Schedules. Global Impex has taken all actions required by Laws, the Global Impex Organizational Documents, or otherwise to authorize the execution and delivery of this Agreement. Global Impex has full power, authority, and legal capacity to execute this Agreement and to consummate the Transactions. |
| (c) | Marsh CDM has taken all actions required by Laws, the Organizational Documents of Marsh CDM, or otherwise to authorize the execution and delivery of this Agreement. Marsh CDM has full power, authority, and legal capacity to execute this Agreement and to consummate the Transactions. |
| (d) | The Organizational Documents of Geo Impex India (collectively, the “Geo Impex India Organizational Documents”) are set forth in Section 4.02(d) of Disclosure Schedules. Geo Impex India has taken all actions required by Laws, the Geo Impex India Organizational Documents, or otherwise to authorize the execution and delivery of this Agreement. Geo Impex India has full power, authority, and legal capacity to execute this Agreement and to consummate the Transactions. |
Section 4.03 Authorization of Agreement; Etc. The execution, delivery and performance of this Agreement by each Geo Impex Party, and the consummation of Transactions, have been duly authorized by each member or shareholder(s) of such Geo Impex Party and by any other Persons as required. This Agreement has been duly executed and delivered on behalf of each Geo Impex Party. This Agreement constitutes a valid and binding obligation of each Geo Impex Party enforceable in accordance with its terms, except that such enforcement may be limited by the Enforceability Exceptions, and subject to the qualification that the availability of equitable remedies is subject to the discretion of the court before which any proceeding therefore may be brought.
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Section 4.04 No Conflict. The execution of this Agreement and the consummation of the Transactions (i) will not violate any provision of any Organizational Documents of any Geo Impex Party; (ii) will not, with or without notice, lapse of time or both, result in the breach of any term or provision of, constitute a default under, or terminate, accelerate or modify the terms of any indenture, mortgage, deed of trust, or other material agreement, or instrument to which any Geo Impex Party is a party or to which any of its assets, properties or operations are subject; (iii) violate any provision of Laws, statute, rule, regulation or executive order to which any Geo Impex Party is subject; or (iv) violate any judgment, order, writ or decree of any court applicable to any Geo Impex Party.
Section 4.05 Global Impex Equity Interests.
| (a) | The only Equity Securities of Global Impex are the Membership Interests, all of which are owned by Geo Impex. None of the outstanding Membership Interests were issued in violation of the preemptive or other rights of any members, shareholders or other Person. |
| (b) | There are no outstanding or authorized Derivatives with respect to Global Impex. Global Impex does not have outstanding or authorized any stock appreciation, phantom stock, profit participation or similar rights. There are no voting trusts, stockholder agreements, member agreements proxies or other agreements or understandings in effect with respect to the voting or transfer of any of the Membership Interests. |
| (c) | Geo Impex is the record and beneficial owner of, and has good title to the Membership Interests, with the right and authority to sell and deliver the Membership Interests, free and clear of all liens, claims, charges, encumbrances, pledges, mortgages, security interests, options, rights to acquire, proxies, voting trusts or similar agreements, restrictions on transfer or adverse claims of any nature whatsoever (collectively, “Liens”). None of the Membership Interests is subject to pre-emptive or similar rights, either pursuant to any Organizational Document of any Geo Impex Party, requirement of Laws or any Contract, and Geo Impex does not have any pre-emptive rights or similar rights to purchase or receive any Membership Interests or other interests in Global Impex. Geo Impex has the power and authority to transfer the Membership Interests to ConnectM as contemplated pursuant to the terms of this Agreement and upon delivery of any certificate or certificates duly assigned, representing the same as herein contemplated and/or upon registering ConnectM or its designee as the new owner of the Membership Interests in the records maintained by Global Impex listing the names of members and their respective ownership of Membership Interests, ConnectM or its designee will receive good title to the Membership Interests, free and clear of all Liens. |
Section 4.06 Geo Impex India Equity Interests.
| (a) | None of the Geo Impex India Shares held by Global Impex or the Marsh CDM/Geo Impex India Shares were issued in violation of the preemptive or other rights of any members, shareholders or other Person. |
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| (b) | There are no outstanding or authorized Derivatives with respect to Geo Impex India. Geo Impex India does not have outstanding or authorized any stock appreciation, phantom stock, profit participation or similar rights. There are no voting trusts, stockholder agreements, member agreements proxies or other agreements or understandings in effect with respect to the voting or transfer of any of the Geo Impex India Shares. |
| (c) | Global Impex is the record and beneficial owner of, and has good title to 5,574,005 Geo Impex India Shares, free and clear of all Liens. The Geo Impex India Shares held by Global Impex represent 48.01% of the equity interests of Geo Impex India. As of the Closing, none of the Geo Impex India Shares held by Global Impex is subject to pre-emptive or similar rights, either pursuant to any Organizational Document of any Geo Impex Party, requirement of Laws or any Contract, and Global Impex does not have any pre-emptive rights or similar rights to purchase or receive any Geo Impex India Shares or other interests in Geo Impex India. |
| (d) | Marsh CDM is the record and beneficial owner of, and has good title to the Marsh CDM/Geo Impex India Shares, free and clear of all Liens. The Marsh CDM/Geo Impex India Shares represent 38.21% of the equity interests of Geo Impex India. None of the Marsh CDM/Geo Impex India Shares is subject to pre-emptive or similar rights, either pursuant to any Organizational Document of any Geo Impex Party, requirement of Laws or any Contract, and Marsh CDM does not have any pre-emptive rights or similar rights to purchase or receive any Geo Impex India Shares or other interests in Geo Impex India. |
Section 4.07 Accredited Investor; Etc.
| (a) | Geo Impex is acquiring the Exchange Shares and the Note (such Exchange Shares and the Note collectively the “Connect M Securities”) for investment for Geo Impex’s own account and not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and Geo Impex has no present intention of selling, granting any participation in, or otherwise distributing the same. Geo Impex further represents that it does not have any Contract, undertaking, agreement or arrangement with any Person to sell, transfer or grant participation to such Person or to any third Person, with respect to any of the Connect M Securities. |
| (b) | Geo Impex represents and warrants that Geo Impex (i) can bear the economic risk of Geo Impex’s investment in the Connect M Securities, and (ii) possesses such knowledge and experience in financial and business matters that Geo Impex is capable of evaluating the merits and risks of the investment in ConnectM, the Connect M Securities, ConnectM India and the Note. |
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| (c) | Geo Impex represents that it is an “accredited investor” (an “Accredited Investor”) as that term is defined in Rule 501 of Regulation D (“Regulation D”) promulgated by the Securities and Exchange Commission (“SEC”) under Section 4(a)(2) of the Securities Act of 1933, as amended (“Securities Act”), and that Geo Impex understands and acknowledges that ConnectM and ConnectM India are relying upon such representation to qualify for the exemption from the registration requirements of the Securities Act pursuant to Rule 506 of Regulation D, and that any certificate representing the Connect M Securities shall be endorsed with the following legends, in addition to any other legend required to be placed thereon by applicable federal or state securities Laws: |
“THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE 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 (TOGETHER WITH THE RULES AND REGULATIONS THEREUNDER, 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.”
| (d) | Geo Impex acknowledges that neither the SEC nor the securities regulatory body of any other jurisdiction, has received, considered or passed upon the accuracy or adequacy of the information and representations made in this Agreement. |
| (e) | Geo Impex acknowledges that it has carefully reviewed such information as Geo Impex has deemed necessary to evaluate an investment in ConnectM, ConnectM India and the Connect M Securities. Geo Impex acknowledges that Geo Impex has been furnished all materials that it has requested relating to ConnectM and ConnectM India and the issuance of the Connect M Securities hereunder, and that Geo Impex has been afforded the opportunity to ask questions of ConnectM’s and ConnectM India’s representatives to obtain any information necessary to verify the accuracy of any representations or information made or given to Geo Impex. |
| (f) | Geo Impex understands that the Connect M Securities may not be sold, transferred, or otherwise disposed of without registration under the Securities Act or an exemption therefrom, and that in the absence of an effective registration statement covering the Connect M Securities or any available exemption from registration under the Securities Act, the Connect M Securities may have to be held indefinitely. Geo Impex understands that (i) the sale or re-sale of the Connect M Securities has not been and is not being registered under the Securities Act or any applicable state securities Laws, and the Connect M Securities may not be transferred unless (a) the Connect M Securities are sold pursuant to an effective registration statement under the Securities Act, (b) Geo Impex shall have delivered to ConnectM, at the cost of Geo Impex, an opinion of counsel that shall be in form, substance and scope customary for opinions of counsel in comparable transactions to the effect that the Connect M Securities to be sold or transferred may be sold or transferred pursuant to an exemption from such registration, which opinion shall be accepted by ConnectM, (c) the Connect M Securities are sold or transferred to an Affiliate of Geo Impex who agree to sell or otherwise transfer the Connect M Securities only in accordance with this Section 4.07(f) and who is an Accredited Investor, (d) the Connect M Securities are sold pursuant to Rule 144 promulgated under the Securities Act (“Rule 144”)), or (e) the Connect M Securities are sold pursuant to Regulation S under the Securities Act (or a successor rule) (“Regulation S”), and Geo Impex shall have delivered to ConnectM, at the cost of Geo Impex, an opinion of counsel that shall be in form, substance and scope customary for opinions of counsel in corporate transactions, which opinion shall be accepted by ConnectM; (ii) any sale of such Connect M Securities made in reliance on Rule 144 may be made only in accordance with the terms of said Rule and further, if said Rule is not applicable, any re-sale of such Connect M Securities under circumstances in which the seller (or the Person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the Securities Act) may require compliance with some other exemption under the Securities Act or the rules and regulations of the SEC thereunder; and (iii) neither ConnectM nor any other Person is under any obligation to register such Connect M Securities under the Securities Act or any state securities Laws or to comply with the terms and conditions of any exemption thereunder (in each case). |
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| (g) | Geo Impex agrees that, notwithstanding anything contained herein to the contrary, the warranties, representations, agreements and covenants of Geo Impex under this Section 4.07 shall survive the Closing for the period set forth in Section 8.01. |
Section 4.08 No Operations. Neither Global Impex nor Marsh CDM has any operations and has not undertaken any activities other than their respective ownership of Geo Impex India Shares as set forth herein.
Section 4.09 Liabilities. Section 4.09 of Disclosure Schedules sets forth, as of the Effective Date, separately, (i) a true, correct and complete list of all outstanding loans, lines of credit and other indebtedness incurred by any of Global Impex or Geo Impex India (each, a “Target Company” and collectively, the “Target Companies”) inclusive of any outstanding loans, lines of credit and other indebtedness incurred by any Target Company, the repayment obligations for which are secured by any of any Target Company’s assets; (ii) with respect to each loan described in the foregoing clause, the remaining amounts due thereunder as of the Effective Date and (iii) any other Liabilities of any Target Company. For purposes herein, “Liabilities” means any liabilities, obligations or commitments of any nature whatsoever, asserted or unasserted, known or unknown, absolute or contingent, accrued or unaccrued, matured or unmatured or otherwise, including without limitation any penalties, interest and/or excise Tax as may be applicable.
Section 4.10 Litigation and Proceedings. There are no actions, suits, proceedings, or investigations pending or, to the Knowledge of Geo Impex, threatened, by or against any Target Company or affecting any Target Company or its respective properties, at law or in equity, before any court or other governmental agency or instrumentality, domestic or foreign, or before any arbitrator of any kind. No Target Company has any knowledge of any material default on its part with respect to any judgment, order, injunction, decree, award, rule, or regulation of any court, arbitrator, or governmental agency or instrumentality or of any circumstances which, after reasonable investigation, would result in the discovery of such a default.
Section 4.11 General Compliance. No Target Company to its knowledge is (i) in default under or in violation of (and no event has occurred that has not been waived that, with notice, lapse of time or both, would result in a default by any Target Company under), nor has any Target Company received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default or violation has been waived); (ii) in violation of any judgment, decree or order of any court, arbitrator or other governmental authority; or (iii) or has not been, in violation of any statute, rule, ordinance or regulation of any governmental authority, including without limitation all foreign, federal, state and local Laws relating to Taxes, registration as a charitable organization, and employment and labor matters, except in each case as could not have or reasonably be expected to result in a Material Adverse Effect on any Target Company.
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Section 4.12 Compliance with Laws; Permits.
| (a) | Each Target Company has complied in all material respects, and are now complying in all material respects, with all Laws applicable to it or its respective business, properties or assets. All prior issuances of securities of each Target Company have been either registered under the Securities Act or other applicable Law, or exempt from registration. |
| (b) | All material Permits required for each Target Company to conduct its business have been obtained by it and are valid and in full force and effect, except as would reasonably be expected to result in a Material Adverse Effect on such Target Company. All fees and charges with respect to such Permits have been paid in full. To the Knowledge of Geo Impex, no event has occurred that, with or without notice or lapse of time or both, would reasonably be expected to result in the revocation, suspension, lapse or limitation of any Permit material to the operations of any Target Company. No Target Company has received any notice of proceedings relating to the revocation or modification of any such Permit |
| (c) | No Target Company is, or has been, and the past and present officers, members, managers and affiliates of any Target Company are not and have not, been the subject of, nor does any officer, member, manager or affiliate of any Target Company have any reason to believe that any Target Company or any of its officers, members, managers or affiliates will be the subject of (i) any civil or criminal proceeding or investigation by any federal or state agency alleging a violation of Laws, or (ii) any civil, criminal or administrative investigation or proceeding brought by any Governmental Authority. |
Section 4.13 Contracts.
| (a) | Section 4.13(a) of Disclosure Schedules contains a list of all Contracts, agreements, franchises, license agreements, debt instruments or other commitments to which any Target Company is a party or by which it or any of its assets, products, technology, or properties are bound. In the case of oral agreements, Section 4.13(a) of Disclosure Schedules contains a description thereof. |
| (b) | All Contracts, agreements, franchises, license agreements, and other commitments to which any Target Company is a party or by which its properties are bound and which are material to the operations of such Target Company are valid and enforceable by such Target Company in all respects, except as limited by bankruptcy and insolvency Laws and by other Laws affecting the rights of creditors generally. |
| (c) | Each Target Company owns, licenses or has rights to use any and all intellectual property and technology used in such Target Company’s business, and to its knowledge such Target Company’s use of such intellectual property or technology does not infringe upon the intellectual property rights of any third party; and |
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| (d) | Except as included or described in Section 4.13(a) of Disclosure Schedules, no Target Company is a party to any oral or written (i) Contract for the employment of any officer or employee; (ii) profit sharing, bonus, deferred compensation, stock option, severance pay, pension benefit or retirement plan; (iii) agreement, Contract, or indenture relating to the borrowing of money; (iv) guaranty of any obligation; (vi) collective bargaining agreement; or (vii) agreement with any present or former officer or manager of any Target Company, which, in each case cannot be terminated by such Target Company on notice of no more than 10 (10) days at a cost of no more than $5,000. |
Section 4.14 Bank Accounts; Power of Attorney. Section 4.14 of Disclosure Schedules sets forth a true and complete list of (i) all accounts with banks, money market mutual funds or securities or other financial institutions maintained by any Target Company within the past twelve (12) months, the account numbers thereof, and all Persons authorized to sign or act on behalf of such Target Company; (ii) all safe deposit boxes and other similar custodial arrangements maintained by any Target Company within the past twelve (12) months; (iii) the check ledger for the last twelve (12) months, and (iv) the names of all Persons holding powers of attorney from any Target Company or who are otherwise authorized to act on behalf of any Target Company with respect to any matter, other than its officers and managers, and a summary of the terms of such powers or authorizations.
Section 4.15 Disclosure. Each Target Company maintains a system of internal accounting controls appropriate for its size. There is no transaction, arrangement, or other relationship between any Target Company and an unconsolidated or other off balance sheet entity that is not disclosed by such Target Company in its financial statements or otherwise that would be reasonably likely to have a Material Adverse Effect on such Target Company.
Section 4.16 Intellectual Property.
| (a) | Each Target Company owns or possess adequate rights or licenses to use all material trademarks, trade names, service marks, service mark registrations, service names, patents, patent rights, copyrights, inventions, licenses, approvals, governmental authorizations, trade secrets and rights necessary to conduct its businesses as now conducted. None of such Target Company’s material Intellectual Property has expired or terminated, or, by the terms and conditions thereof, could expire or terminate within two years from the Effective Date. To the Knowledge of Geo Impex there is no infringement by any Target Company of any material Intellectual Property of others, or of any such development of similar or identical trade secrets or technical information by others, and there is no claim, action or proceeding being made or brought against, or to the Knowledge of Geo Impex, being threatened against, any Target Company regarding the infringement of any Intellectual Property, which could reasonably be expected to have a Material Adverse Effect on any Target Company. |
| (b) | Without limiting the generality of the foregoing, each Target Company has entered into binding (except to the extent that the enforceability thereof may be limited by the Enforceability Exceptions), written agreements with every current and former employee of such Target Company, and with every current and former independent contractor, whereby such employees and independent contractors (i) assign to such Target Company any ownership interest and right they may have in Intellectual Property owned by such Target Company; and (ii) acknowledge such Target Company’s exclusive ownership of all Intellectual Property owned by such Target Company. Geo Impex has provided ConnectM with true and complete copies of all such agreements. To the Knowledge of Geo Impex, each Target Company is in material compliance with all legal requirements applicable to Intellectual Property owned by such Target Company and such Target Company’s ownership and use thereof. |
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| (c) | All required filings and fees related to the Intellectual Property owned by any Target Company that are either subject to any issuance, registration, application or other filing by, to or with any Governmental Authority or authorized private registrar in any jurisdiction (collectively, the “Intellectual Property Registrations”) have been timely filed with and paid to the relevant Governmental Authorities and authorized registrars, and all Intellectual Property Registrations are otherwise in good standing. Geo Impex has provided ConnectM with true and complete copies of file histories, documents, certificates, office actions, correspondence and other materials related to all Intellectual Property Registrations. |
| (d) | Each Target Company has taken all reasonable measures to protect and preserve its rights in Intellectual Property owned by such Target Company and the confidentiality of all trade secrets owned, exploited, held for exploitation, appropriated or otherwise obtained or possessed by such Target Company. |
Section 4.17 Condition and Sufficiency of Assets. Except for ordinary wear and tear, the buildings, plants, structures, furniture, fixtures, machinery, equipment, vehicles and other items of tangible personal property of each Target Company are structurally sound, are in good operating condition and repair, and are adequate for the uses to which they are being put, and none of such buildings, plants, structures, furniture, fixtures, machinery, equipment, vehicles and other items of tangible personal property is in need of maintenance or repairs except for ordinary, routine maintenance and repairs that are not material in nature or cost. The buildings, plants, structures, furniture, fixtures, machinery, equipment, vehicles and other items of tangible personal property currently owned or leased by each Target Company, together with all other properties and assets of such Target Company, are sufficient for the conduct of such Target Company’s business as conducted as of the Closing and constitute all of the rights, property and assets necessary to conduct the business of each Target Company as conducted as of the Closing.
Section 4.18 Accounts Receivable. The accounts receivable reflected on the books and records of each Target Company and the accounts receivable arising after the date thereof (a) have arisen from bona fide transactions entered into by such Target Company involving the sale of goods or the rendering of services in the Ordinary Course of Business; (b) constitute only valid, undisputed claims of such Target Company not subject to claims of set-off or other defenses or counterclaims other than normal cash discounts accrued in the Ordinary Course of Business; and (c) are collectible in full within ninety (90) calendar days after billing.
Section 4.19 Title. Each Target Company has good and marketable title in fee simple to all real property owned by it, or leases such real property pursuant to valid and in-force lease agreements, and has good and marketable title in all personal property owned by it that is material to the business of such Target Company, in each case free and clear of all Liens and, except for Liens as do not materially affect the value of such property and do not materially interfere with the use made and proposed to be made of such property by such Target Company and Liens for the payment of federal, state or other Taxes, the payment of which is neither delinquent nor subject to penalties. Any real property and facilities held under lease by any Target Company is held under valid, subsisting and enforceable leases with which such Target Company is in compliance with such exceptions as are not material and do not interfere with the use made and proposed to be made of such property and buildings by such Target Company.
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Section 4.20 Insurance. Each Target Company is insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as management of such Target Company believes to be prudent and customary in the businesses in which such Target Company is engaged. No Target Company has been refused any insurance coverage sought or applied for, and no Target Company has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would not materially and adversely affect the condition, financial or otherwise, or the earnings, business or operations of such Target Company, taken as a whole.
Section 4.21 4Taxes.
| (a) | Global Impex has elected to be taxed as an “C” corporation. |
| (b) | No Target Party is subject to taxation in the United States or in any State. |
| (c) | Each Target Company has paid all Taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations, except those being contested in good faith and has set aside on its books provision reasonably adequate for the payment of all Taxes for periods subsequent to the periods to which such returns, reports or declarations apply. There are no unpaid Taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of each Target Company know of no basis for any such claim. All Tax Returns required to be filed on or before the Closing Date by each Target Company have been, or will be, timely filed. Such Tax Returns are, or will be, true, complete and correct in all material respects. All Taxes due and owing by any Target Company (whether or not shown on any Tax Return) have been, or will be, timely paid. Each Target Company has withheld and paid each Tax required to have been withheld and paid in connection with amounts paid or owing to any employee, independent contractor, creditor, customer, shareholder or other party, and complied with all information reporting and backup withholding provisions of applicable Law. |
| (d) | No claim has been made by any taxing authority in any jurisdiction where any Target Company does not file Tax Returns that it is, or may be, subject to Tax by that jurisdiction. No extensions or waivers of statutes of limitations have been given or requested with respect to any Taxes of any Target Company. The amount of each Target Company’s liability for unpaid Taxes for all periods does not, in the aggregate, exceed the amount of accruals for Taxes (excluding reserves for deferred Taxes) reflected on the financial statements of such Target Company. All deficiencies asserted, or assessments made, against any Target Company as a result of any examinations by any taxing authority have been fully paid. No Target Company is a party to any Action by any taxing authority. To the Knowledge of Geo Impex, there are no pending or threatened Actions by any taxing authority against any Target Company. |
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| (e) | There are no Encumbrances for Taxes (other than for current Taxes not yet due and payable) upon the assets of any Target Company. |
| (f) | No Target Company is a party to, or bound by, any Tax indemnity, Tax-sharing or Tax allocation agreement. No Target Company is a party to, or bound by, any closing agreement or offer in compromise with any taxing authority. No private letter rulings, technical advice memoranda or similar agreement or rulings have been requested, entered into or issued by any taxing authority with respect to any Target Company. |
| (g) | No Target Company is, and has not been, a member of an affiliated, combined, consolidated or unitary Tax group for Tax purposes. No Target Company has any Liability for Taxes of any Person (other than itself) under Treasury Regulations Section 1.1502-6 (or any corresponding provision of state, local or foreign Law), as transferee or successor, by Contract or otherwise. No Target Company has agreed to make, nor is it required to make, any adjustment under Sections 481(a) or 263A of the Code or any comparable provision of state, local or foreign Tax Laws by reason of a change in accounting method or otherwise. No Target Company has taken any action that could defer a Liability for Taxes of such Target Company from any period prior to the Closing to any period following the Closing. |
| (h) | Neither Geo Impex nor Global Impex is a “foreign person” as that term is used in Treasury Regulations Section 1.1445-2. No Target Company is, and has never been, a United States real property holding corporation (as defined in Section 897(c)(2) of the Code) during the applicable period specified in Section 897(c)(1)(a) of the Code. No Target Company has been a “distributing corporation” or a “controlled corporation” in connection with a distribution described in Section 355 of the Code. No Target Company is, and has not been, a party to, or a promoter of, a “reportable transaction” within the meaning of Section 6707A(c)(1) of the Code and Treasury Regulations Section 1.6011-4(b). There is currently no limitation on the utilization of net operating losses, capital losses, built-in losses, tax credits or similar items of any Target Company under Sections 269, 382, 383, 384 or 1502 of the Code and the Treasury Regulations thereunder (and comparable provisions of state, local or foreign Law). |
| (i) | No Target Company has entered into a gain recognition agreement pursuant to Treasury Regulations Section 1.367(a)-8. No Target Company has transferred an intangible the transfer of which would be subject to the rules of Section 367(d) of the Code. |
| (j) | None of the assets of any Target Company is property that such Target Company is required to treat as being owned by any other person pursuant to the so-called “safe harbor lease” provisions of former Section 168(f)(8) of the Internal Revenue Code of 1954, as amended. |
Section 4.22 Transactions with Affiliates. None of the members, managers or officers or directors of any Target Company and, to the Knowledge of Geo Impex, none of the employees of any Target Company, is presently a party to any transaction with any Target Company (other than for services as employees, officers and directors), including any Contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments to or from any officer, director or such employee or, to the Knowledge of Geo Impex, any entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee or partner, in each case in excess of the lesser of (i) $120,000 or (ii) one percent of the average of any Target Company’s total assets at year-end for the last two completed fiscal years, other than for (i) payment of salary or consulting fees for services rendered, (ii) reimbursement for expenses incurred on behalf of any Target Company and (iii) other employee benefits, including stock option agreements under any stock option plan of any Target Company.
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Section 4.23 Foreign Corrupt Practices. No Target Company, nor, to the Knowledge of Geo Impex, any agent or other Person acting on behalf of any Target Company, has (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by any Target Company (or made by any Person acting on its behalf of which any Target Company is aware) which is in violation of Law, or (iv) violated in any material respect any provision of the Foreign Corrupt Practices Act of 1977, as amended.
Section 4.24 Money Laundering. Each Target Company is in compliance with, and has not previously violated, the USA PATRIOT ACT of 2001 and all other applicable U.S. and non-U.S. anti-money laundering Laws and regulations, including, but not limited to, the Laws, regulations and Executive Orders and sanctions programs administered by the U.S. Office of Foreign Assets Control, including, but not limited, to (i) Executive Order 13224 of September 23, 2001 entitled, “Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism” (66 Fed. Reg. 49079 (2001)); and (ii) any regulations contained in 31 CFR, Subtitle B, Chapter V.
Section 4.25 Illegal or Unauthorized Payments; Political Contributions. No Target Company nor, to the Knowledge of Geo Impex, any of the officers, directors, employees, agents or other representatives of any Target Company or any other business entity or enterprise with which any Target Company is or has been affiliated or associated, has, directly or indirectly, made or authorized any payment, contribution or gift of money, property, or services, whether or not in contravention of applicable Law, (a) as a kickback or bribe to any Person or (b) to any political organization, or the holder of or any aspirant to any elective or appointive public office except for personal political contributions not involving the direct or indirect use of funds of a Target Company.
Section 4.26 Environmental Laws. To Knowledge of Geo Impex, each Target Company (i) is in compliance with any and all applicable foreign, federal, state and local Laws and regulations relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants or contaminants (“Environmental Laws”), (ii) has received all Permits, licenses or other approvals required of it under applicable Environmental Laws to conduct its respective businesses and (iii) is in compliance with all terms and conditions of any such Permit, license or approval, except where, in each of the three foregoing clauses, the failure to so comply could not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on such Target Company.
Section 4.27 Investment Company. No Target Company is an “investment company” within the meaning of the Investment Company Act of 1940, as amended.
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Section 4.28 No Disqualification Events. None of any Target Company, any of their respective predecessors, any affiliated issuer, any director, executive officer, other officer of any Target Company, any beneficial owner of 20% or more of any Target Company’s outstanding voting equity securities, calculated on the basis of voting power, nor any promoter (as that term is defined in Rule 405 under the Securities Act) connected with any Target Company in any capacity at the time of sale (each, an “Issuer Covered Person”) is subject to any of the “Bad Actor” disqualifications described in Rule 506(d)(1)(i) to (viii) under the Securities Act (a “Disqualification Event”), except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3) under the Securities Act. Each Target Company has exercised reasonable care to determine whether any Issuer Covered Person is subject to a Disqualification Event.
Section 4.29 No Brokers. No Geo Impex Party has retained any broker or finder in connection with any of the Transactions, and has not incurred or agreed to pay, or taken any other action that would entitle any Person to receive, any brokerage fee, finder’s fee or other similar fee or commission with respect to any of the Transactions.
Section 4.30 Disclosure. All disclosure provided to ConnectM regarding the Geo Impex Parties, their respective business and Transactions, including Disclosure Schedules to this Agreement, furnished by or on behalf of any Geo Impex Party with respect to the representations and warranties made herein are true and correct with respect to such representations and warranties and do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading. Each Geo Impex Party acknowledges and agrees that no ConnectM Party has made, nor is any ConnectM Party making, any representations or warranties with respect to Transactions other than those specifically set forth herein.
Article V. Representations And Warranties Of The ConnectM Parties
As an inducement to, and to obtain the reliance of the Geo Impex Parties, ConnectM represents and warrants, as of the Effective Date and as of the Closing Date, as follows:
Section 5.01 Organization.
| (a) | ConnectM is a corporation duly incorporated, validly existing, and in good standing under the Laws of Delaware and has the corporate power and is duly authorized under all applicable Laws, regulations, ordinances, and orders of public authorities to carry on its business in all material respects as it is now being conducted. The execution and delivery of this Agreement does not, and the consummation of Transactions will not, violate any provision of ConnectM’s certificate of incorporation or by-laws. ConnectM has taken all action required by Laws, its certificate of incorporation and by-laws, or otherwise to authorize the execution and delivery of this Agreement, and ConnectM has full power, authority, and legal right and has taken all action required by Laws, its certificate of incorporation and by-laws, or otherwise to consummate the transactions herein contemplated. |
| (b) | ConnectM India is private limited company, duly organized, validly existing, and in good standing under the Laws of India and has the power and is duly authorized under all applicable Laws, regulations, ordinances and orders of public authorities, to carry on its business in all material respects as it is now being conducted. ConnectM India has not qualified to do business in any jurisdiction other than India. To the knowledge of ConnectM, no proceeding has been instituted in any jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail the power and authority or qualification of ConnectM India within such jurisdiction. |
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Section 5.02 Power and Authority. Each ConnectM Party has all requisite power and authority to execute, deliver and perform its obligations under this Agreement and to consummate the Transactions.
Section 5.03 Authorization of Agreement; Etc. The execution, delivery and performance of this Agreement by each ConnectM Party, and the consummation of Transactions, have been duly authorized by Board of ConnectM. This Agreement has been duly executed and delivered on behalf of each ConnectM Party. This Agreement constitutes a valid and binding obligation of each ConnectM Party enforceable in accordance with its terms, except that such enforcement may be limited by the Enforceability Exceptions, and subject to the qualification that the availability of equitable remedies is subject to the discretion of the court before which any proceeding therefore may be brought.
Section 5.04 No Conflict. The execution of this Agreement and the consummation of the Transactions (i) will not violate any provision of the Organizational Documents of any ConnectM Party; (ii) will not, with or without notice, lapse of time or both, result in the breach of any term or provision of, constitute a default under, or terminate, accelerate or modify the terms of any indenture, mortgage, deed of trust, or other material agreement, or instrument to which any ConnectM Party is a party or to which any of its assets, properties or operations are subject; (iii) violate any provision of Laws, statute, rule, regulation or executive order to which any ConnectM Party is subject; or (iv) violate any judgment, order, writ or decree of any court applicable to any ConnectM Party.
Section 5.05 Approval of Agreement and of Issuance of Shares. The Board of ConnectM has authorized the execution and delivery of this Agreement by ConnectM and has approved this Agreement and the issuance of the Exchange Shares.
Section 5.06 No Brokers. No ConnectM Party has retained any broker or finder in connection with any of the Transactions, and no ConnectM Party has incurred or agreed to pay, or taken any other action that would entitle any Person to receive, any brokerage fee, finder’s fee or other similar fee or commission with respect to any of the Transactions.
Section 5.07 Disclosure. All disclosure provided to Geo Impex regarding the ConnectM Parties, their respective business and Transactions, furnished by or on behalf of any ConnectM Party with respect to the representations and warranties made herein are true and correct and do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading. Each ConnectM Party acknowledges and agrees that the Geo Impex Parties have not made, nor are the Geo Impex Parties making, any representations or warranties with respect to Transactions other than those specifically set forth herein.
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Article VI. Covenants And Additional Agreements Of The Parties
Section 6.01 Notices of Certain Events. In addition to any other notice required to be given by the terms of this Agreement, each of the Parties shall promptly notify each of the other Parties of:
| (a) | any notice or other communication from any Person alleging that the consent of such Person is or may be required in connection with any of the Transactions; |
| (b) | any notice or other communication from any governmental or regulatory agency or authority in connection with the Transactions; and |
| (c) | any actions, suits, claims, investigations or proceedings commenced or, to its knowledge threatened against, relating to or involving or otherwise affecting such Party that, if pending on the date of this Agreement, would have been required to have been disclosed pursuant hereto or that relates to the consummation of the Transactions. |
Section 6.02 Access to Information. Following the Effective Date, until consummation of the Transactions or the earlier termination of this Agreement, the Geo Impex Parties shall give to ConnectM and its authorized representatives full and complete access to the books and records, Contracts, facilities and personnel of the Geo Impex Parties as ConnectM and its authorized representatives may request so that ConnectM may complete its due diligence investigation of the Geo Impex Parties. The Geo Impex Parties agree to provide ConnectM and its authorized representatives with access to any information in any of their possession or control that contains information generated by any Geo Impex Party regarding any Geo Impex Party relative to its financial, operational, and/or regulatory condition (present, past, or prospective). If ConnectM, in its sole discretion, at any time prior to the Closing determines that its due diligence review of any Geo Impex Party is not satisfactory to ConnectM, then ConnectM may terminate this Agreement upon notice to Geo Impex.
Section 6.03 Consents of Third Parties. Each of the Parties will give any notices to third parties, and will use its commercially reasonable efforts to obtain any third-party consents, that the other Parties reasonably may request in connection with this Agreement. Each of the Parties will give any notices to, make any filings with, and use its commercially reasonable efforts to obtain any authorizations, consents, and approvals of governments and governmental agencies in connection with the matters in this Agreement.
Section 6.04 No-Shop.
| (a) | From the Effective Date until the first to occur of the Closing or the termination of this Agreement in accordance with its terms, no Geo Impex Party shall, and each Geo Impex Party shall cause the Representatives of each Geo Impex Party not to, directly or indirectly: |
| (i) | solicit, initiate, knowingly encourage or knowingly facilitate the making, submission or announcement of any Acquisition Proposal or Acquisition Inquiry; |
| (ii) | furnish any non-public information regarding any Target Company to any Person who has made an Acquisition Proposal or an Acquisition Inquiry; |
| (iii) | engage in discussions or negotiations with any Person who has made any Acquisition Proposal or Acquisition Inquiry; |
| (iv) | approve, endorse or recommend any Acquisition Proposal or Acquisition Inquiry; |
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| (v) | withdraw or propose to withdraw its approval and recommendation in favor of this Agreement and the Transactions; or |
| (vi) | enter into any letter of intent, agreement in principle, merger, acquisition, purchase or joint venture agreement or other similar agreement for any Acquisition Transaction. |
| (b) | From the Effective Date until the first to occur of the Closing or the termination of this Agreement in accordance with its terms, no Geo Impex Party shall (i) approve or recommend, or propose publicly to approve or recommend, any Acquisition Proposal, (ii) take any action to make the provisions of any “fair price”, “moratorium”, “control share acquisition”, “business combination” or other similar anti-takeover statute or regulation inapplicable to any transaction contemplated by an Acquisition Proposal related to any Geo Impex Party, or (iii) approve or recommend, or propose publicly to approve or recommend, or cause or authorize any Geo Impex Party to enter into, any letter of intent, agreement in principle, merger, acquisition, purchase or joint venture agreement or Contract or other instrument in respect of or relating to an Acquisition Proposal. |
| (c) | Each Geo Impex Party shall promptly, within 36 hours, advise ConnectM orally and in writing of any Acquisition Proposal or Acquisition Inquiry (including the identity of the Person making or submitting such Acquisition Proposal or Acquisition Inquiry and the terms thereof and all material modifications thereto) that is made or submitted by any Person during the period beginning on the Effective Date until the Closing or the termination of this Agreement in accordance with its terms. Each Geo Impex Party shall keep ConnectM reasonably informed on a current basis of any material developments in the status and terms of any such Acquisition Proposal or Acquisition Inquiry (including whether such Acquisition Proposal or Acquisition Inquiry has been withdrawn or rejected and any material change to the terms thereof). |
| (d) | Each Geo Impex Party shall immediately cease and cause to be terminated any discussions existing as of the Effective Date with any Person that relate to any Acquisition Proposal or Acquisition Inquiry proposed on or prior to the Effective Date. Each Geo Impex Party acknowledges and agree that any actions taken by or at the direction of a Representative of any Geo Impex Party that, if taken by any Geo Impex Party, would constitute a breach or violation of this Section 6.04 will be deemed to constitute a breach and violation of this Section 6.04 by such Geo Impex Party. |
Section 6.05 Affirmative Covenants. Between the Effective Date and the Closing Date or earlier termination of this Agreement in accordance with its terms, and except as otherwise contemplated by this Agreement or as ConnectM shall otherwise consent in writing in advance, each Geo Impex Party shall, and shall cause each of their Representatives to:
| (a) | conduct the business of each Geo Impex Party only in the Ordinary Course of Business and will use commercially reasonable best efforts to maintain and preserve the assets of each Geo Impex Party, preserve intact the current business organization of each Geo Impex Party, and maintain the relations and goodwill with customers, creditors, employees, agents, and others having business relationships with each Geo Impex Party; |
| (b) | provide ConnectM and its Representatives and agents reasonable access to the books and financial records of each Geo Impex Party at any time during normal business hours prior to the Closing Date, at ConnectM’s sole cost and expense, to perform any inspections or evaluations and observe any meetings of management of any Geo Impex Party which ConnectM reasonably deems necessary or appropriate, other than any such meetings or portions thereof which relate to this Agreement or Transactions; |
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| (c) | furnish to ConnectM true, correct and complete copies of all records, documentation and other information in its possession as ConnectM may reasonably request concerning any Geo Impex Part; |
| (d) | permit ConnectM to, without any obligation to do so, contact any Governmental Authority about any Permits, or Governmental Authorizations concerning any Geo Impex Party; |
| (e) | cause all Contracts to which any Geo Impex Party is a party to be performed to the extent required to be performed as of the Closing Date in full; |
| (f) | cooperate with ConnectM with respect to all filings, permits or consents that ConnectM elects to make or obtain or is required by Law or other Persons to make or obtain in connection with the Transactions; |
| (g) | provide notice to ConnectM as promptly as reasonably practicable upon becoming aware of any event or occurrence capable of causing a material impact on the business of any Geo Impex Party; and |
| (h) | use commercially reasonable efforts to cause the conditions precedent in Article III to be satisfied. |
Section 6.06 Negative Covenants. Between the Effective Date and the Closing Date or earlier termination of this Agreement in accordance with its terms, and except as otherwise contemplated by this Agreement or as ConnectM shall otherwise consent in writing in advance, no Geo Impex Party will, and each Geo Impex Party will cause each of their Representatives not to, directly or indirectly:
| (a) | Amend existing insurance coverage applicable to any Geo Impex Party so long as such insurance is available at commercially reasonable rates; |
| (b) | dispose of any individual capital asset, and will not incur, create or assume any Lien on any individual capital asset, in each case with a value in excess of $5,000, and provided that such disposition will not materially impact the operation of the business of any Geo Impex Party or result in a Material Adverse Effect on any Geo Impex Party; |
| (c) | take any action which could be reasonably expected to prevent or materially delay the consummation of the Transactions; |
| (d) | enter into any new material line of business or commit to any material capital expenditure outside of the Ordinary Course of Business; |
| (e) | (1) issue, authorize or propose the issuance of any Equity Security of any Geo Impex Party, (2) adopt a plan of complete or partial liquidation or resolutions providing for or authorizing such liquidation or a dissolution, merger, consolidation, restructuring, recapitalization or other reorganization, or (3) make any distribution of, or directly or indirectly repurchase, redeem or otherwise acquire, any Equity Security of any Geo Impex Party; |
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| (f) | amend any of Organizational Documents of any Geo Impex Party; |
| (g) | make or announce any increase in salaries, bonuses or other compensation or fringe benefits payable or to become payable, or grant, announce, or increase any termination or severance, retention, change-of-control or similar payments, to any present or former employee, officer, director, agent or independent contractor of any Geo Impex Party, or engage in any material reduction in force or promote any employee to or at or above the level of officer or senior management; |
| (h) | enter into any Contract that, if such Contract had been in effect on the Effective Date, would have been a material to the operations of any Geo Impex Party, amend or terminate any contract that is material to the operations of any Geo Impex Party or waive or cancel any material right thereunder, other than in the Ordinary Course of Business; |
| (i) | sell, lease or otherwise transfer, or create or incur any lien on the assets, securities, property, interests or businesses of any Geo Impex Party other than in the Ordinary Course of Business; |
| (j) | create, incur, or assume any indebtedness or trade debt outside of the Ordinary Course of Business; |
| (k) | change any method of accounting or accounting practice or accounting policy used by any Geo Impex Party, other than such changes required by GAAP or requirements of Law; |
| (l) | settle or compromise any material claims against any Geo Impex Party; |
| (m) | make, revoke or change any Tax election, file any amended Tax Returns, settle or compromise any Tax liability or surrender any refund, waive any statute of limitations with respect to assessment of any Tax or incur any Tax liability outside of the Ordinary Course of Business in each case other than as required by any requirements of Law; |
| (n) | acquire any business or Person, by merger, consolidation or otherwise, in a single transaction or a series of related transactions; or |
| (o) | agree to take any of the foregoing actions, except as expressly contemplated by this Agreement and the other agreements expressly contemplated hereby. |
Section 6.07 Effect of Knowledge on Indemnification. The right to indemnification, reimbursement or other remedy based upon any representations, warranties, covenants and obligations set forth in this Agreement shall not be affected by any investigation conducted with respect to, or any knowledge acquired (or capable of being acquired) at any time, whether before or after the execution and delivery of this Agreement, with respect to the accuracy or inaccuracy of or compliance with any such representation, warranty, covenant or obligation. The waiver of any condition based upon the accuracy of any representation or warranty, or on the performance of or compliance with any covenant or obligation, shall not affect the right to indemnification, reimbursement or other remedy based upon such representations, warranties, covenants or obligations.
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Section 6.08 Further Assurances. Following the Effective Date and following the Closing, or until the earlier termination of this Agreement in accordance with its terms, each of the Parties shall, and shall cause their respective Affiliates to, execute and deliver such additional documents, instruments, conveyances and assurances and take such further actions as may be reasonably required to carry out the provisions hereof and give effect to the Transactions.
Article VII. Termination
Section 7.01 Termination. This Agreement may be terminated at any time before the Closing Date as follows:
| (a) | by mutual written consent of each of the Parties, each in their sole discretion; |
| (b) | by the Geo Impex Parties, acting jointly, or by the ConnectM Parties, acting jointly, if there shall be in effect a final non-appealable order, judgment, injunction or decree entered by or with any governmental authority restraining, enjoining or otherwise prohibiting the consummation of the Transactions; |
| (c) | by the ConnectM Parties, acting jointly, if there shall have been a breach in any material respect of any representation, warranty, covenant or agreement on the part of any Geo Impex Party set forth in this Agreement and such breach has not been cured within ten (10) days after receipt of notice of such breach by Geo Impex (a “Geo Impex Default”); |
| (d) | by the Geo Impex Parties, acting jointly, if there shall have been a breach in any material respect of any representation, warranty, covenant or agreement on the part of any ConnectM Party set forth in this Agreement and such breach has not been cured within ten (10) days after receipt of notice of such breach by ConnectM (an “ConnectM Default”); |
| (e) | by either the Geo Impex Parties, acting jointly, or by the ConnectM Parties, acting jointly, if the Closing has not occurred by within 180 days of the Effective Date, provided, however, that (i) if the Closing has not occurred by such date due to a breach of this Agreement by any ConnectM Party, the ConnectM Parties shall not have the right to terminate this Agreement pursuant to this Section 7.01(e) and (ii) if the Closing has not occurred by such date due to a breach of this Agreement by any Geo Impex Party, the Geo Impex Parties shall not have the right to terminate this Agreement pursuant to this Section 7.01(e); or |
| (f) | pursuant to the provisions of Section 6.02. |
Section 7.02 Effect of Termination. In the event of termination of this Agreement pursuant to this Article VII, this Agreement (other than this Article VII and Article IX, which shall each survive and shall remain in full force and effect) shall become void and of no further force or effect with no liability on the part of any Party; provided, however, that any such termination shall not relieve any Party from liability for actual damages to the other Parties resulting from a material breach of this Agreement by such Party.
Section 7.03 Default by ConnectM Parties. If any ConnectM Party fails to perform any of its obligations under this Agreement, the Geo Impex Parties shall be entitled to bring an action for specific performance, damages or a combination of specific performance and damages. No remedy conferred upon any Geo Impex Party is intended to be exclusive of any other remedy provided for in this Agreement, and each remedy provided to the Geo Impex Parties in this Agreement will be cumulative and in addition to every other remedy available to the Geo Impex Parties under this Agreement. No single or partial exercise of any remedy will preclude any other or further exercise thereof. This provision shall be in addition to the Geo Impex Parties’ remedies under Section 8.03 if the Closing occurs.
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Section 7.04 Default by Geo Impex Parties. If any Geo Impex Party fails to perform any of their respective obligations under this Agreement, the ConnectM Parties shall be entitled to bring an action for specific performance, damages or a combination of specific performance and damages. No remedy conferred upon any ConnectM Party is intended to be exclusive of any other remedy provided for in this Agreement, and each remedy provided to any ConnectM Party in this Agreement will be cumulative and in addition to every other remedy available to the ConnectM Parties under this Agreement. No single or partial exercise of any remedy will preclude any other or further exercise thereof. This provision shall be in addition to the ConnectM Parties’ remedies under Section 8.02 if the Closing occurs.
Article VIII. Survival; indemnification
Section 8.01 Survival.
| (a) | Subject to the limitations and other provisions of this Agreement, the representations and warranties of the Parties contained herein shall survive the Closing and shall remain in full force and effect until the date that is eighteen (18) months after the Closing Date; provided, that the representations and warrants set forth in Section 4.05, Section 4.06 and Section 4.07 (the “Surviving Representations”) shall survive the Closing for a period of five (5) years. Notwithstanding the preceding sentence, any indemnification claim commenced prior to any such expiration shall remain as a valid claim until finally resolved in accordance with the provisions herein. Any claim, for indemnification or otherwise, based upon or arising out of the breach or alleged breach of a representation or warranty must be brought before the expiration of the applicable survival period, or it will be deemed waived. |
| (b) | All covenants and agreements of the Parties contained herein shall survive the Closing for a period of five (5) years or for the period specified therein. Notwithstanding the preceding sentence, any claim commenced prior to any such expiration shall remain as a valid claim until finally resolved in accordance with the provisions herein. |
| (c) | Any claim arising out of or in connection with this Agreement must be brought, if at all, within five years after the Closing Date, or within such shorter period as may be specified with respect to a particular claim, or it will be deemed waived and released. |
Section 8.02 Indemnification by Geo Impex. Subject to the provisions of this Article VIII, if the Closing occurs, Geo Impex and Marsh CDM, jointly and severally, hereby covenant and agree with the ConnectM Parties that Geo Impex and Marsh CDM shall, jointly and severally. indemnify each ConnectM Party and their respective directors, officers, employees and Affiliates, and each of their respective Representatives, successors and assigns (individually, an “ConnectM Indemnified Party”), and hold them harmless from, against and in respect of any and all Losses incurred by any ConnectM Indemnified Party resulting from any misrepresentation, breach of any representation or warranty of any Geo Impex Party in this Agreement or the non-fulfillment in any material respect of any agreement, covenant or obligation by any Geo Impex Party made in this Agreement (including without limitation any Exhibit or Schedule hereto and any certificate or instrument delivered in connection herewith).
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Section 8.03 Indemnification by ConnectM. Subject to the provisions of this Article VIII, if the Closing occurs, ConnectM hereby covenants and agrees with the Geo Impex Parties that ConnectM shall indemnify each Geo Impex Party (each a “Geo Impex Indemnified Party” and collectively, the “Geo Impex Indemnified Parties”) and hold them harmless from, against and in respect of any and all Losses incurred by any Geo Impex Indemnified Party resulting from any misrepresentation, breach of any representation or warranty in this Agreement or the non-fulfillment in any material respect of any agreement, covenant or obligation by any ConnectM Party made in this Agreement (including without limitation any Exhibit or Schedule hereto and any certificate or instrument delivered in connection herewith).
Section 8.04 Indemnification Procedures. The Party making a claim under this Article VIII is referred to as the “Indemnified Party” and the Party against whom such claims are asserted under this Article VIII is referred to as the “Indemnifying Party.”
| (a) | Third-Party Claims. If any Indemnified Party receives notice of the assertion or commencement of any Action made or brought by any Person who is not a party to this Agreement or an Affiliate of a party to this Agreement or a Representative of the foregoing (a “Third-Party Claim”) against such Indemnified Party with respect to which the Indemnifying Party is obligated to provide indemnification under this Agreement, the Indemnified Party shall give the Indemnifying Party reasonably prompt written notice thereof, but in any event not later than thirty (30) calendar days after receipt of such notice of such Third-Party Claim, which notice shall describe the indemnification claim in reasonable detail; include the justification for the demand with reasonable specificity; include copies of all available material written evidence; and, if reasonably practical, indicate the estimated amount of damages. The failure to give such prompt written notice shall not, however, relieve the Indemnifying Party of its indemnification obligations, except and only to the extent that the Indemnifying Party forfeits rights or defenses by reason of such failure. Such notice by the Indemnified Party shall describe the Third-Party Claim in reasonable detail, shall include copies of all material written evidence thereof and shall indicate the estimated amount, if reasonably practicable, of the Loss that has been or may be sustained by the Indemnified Party. The Indemnifying Party shall have the right to participate in, or by giving written notice to the Indemnified Party, to assume the defense of any Third-Party Claim at the Indemnifying Party’s expense and by the Indemnifying Party’s own counsel, and the Indemnified Party shall cooperate in good faith in such defense. In the event that the Indemnifying Party assumes the defense of any Third-Party Claim, subject to Section 8.04(b), it shall have the right to take such action as it deems necessary to avoid, dispute, defend, appeal or make counterclaims pertaining to any such Third-Party Claim in the name and on behalf of the Indemnified Party. The Indemnified Party shall have the right to participate in the defense of any Third-Party Claim with counsel selected by it subject to the Indemnifying Party’s right to control the defense thereof, provided that the fees and disbursements of such counsel shall be at the expense of the Indemnified Party. |
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| (b) | Settlement of Third-Party Claims. Notwithstanding any other provision of this Agreement, the Indemnifying Party shall not enter into settlement of any Third-Party Claim without the prior written consent of the Indemnified Party, except as provided in this Section 8.04(b). If a firm offer is made to settle a Third-Party Claim without leading to liability or the creation of a financial or other obligation on the part of the Indemnified Party and provides, in customary form, for the unconditional release of each Indemnified Party from all liabilities and obligations in connection with such Third-Party Claim and the Indemnifying Party desires to accept and agree to such offer, the Indemnifying Party shall give written notice to that effect to the Indemnified Party. If the Indemnified Party consents to such firm offer the Indemnifying Party may settle the Third-Party Claim upon the terms set forth in such firm offer to settle such Third-Party Claim. If the Indemnified Party objects to such offer, or does not provide a response to such firm offer within ten days after its receipt of such notice (in which case the Indemnified Party shall be deemed to not have consented to such offer), the Indemnified Party shall thereafter assume the defense of such Third-Party Claim and shall continue to contest or defend such Third-Party Claim and in such event the maximum liability of the Indemnifying Party as to such Third-Party Claim shall not exceed the amount of such settlement offer. If the Indemnified Party has assumed the defense pursuant to this Section 8.04(b), the Indemnified Party shall not agree to any settlement without the written consent of the Indemnifying Party (which consent shall not be unreasonably withheld or delayed). |
| (c) | Direct Claims. Any Action by an Indemnified Party on account of a Loss which does not result from a Third-Party Claim (a “Direct Claim”) shall be asserted by the Indemnified Party giving the Indemnifying Party reasonably prompt written notice thereof, but in any event not later than thirty (30) calendar days after the Indemnified Party becomes aware of such Direct Claim, which notice shall describe the indemnification claim in reasonable detail; include the justification for the demand with reasonable specificity; include copies of all available material written evidence; and, if reasonably practical, indicate the estimated amount of damages. The failure to give such prompt written notice shall not, however, relieve the Indemnifying Party of its indemnification obligations, except and only to the extent that the Indemnifying Party forfeits rights or defenses by reason of such failure. Such notice by the Indemnified Party shall describe the Direct Claim in reasonable detail, shall include copies of all material written evidence thereof and shall indicate the estimated amount, if reasonably practicable, of the Loss that has been or may be sustained by the Indemnified Party. The Indemnifying Party shall have thirty (30) calendar days after its receipt of such notice to respond in writing to such Direct Claim. The Indemnified Party shall allow the Indemnifying Party and its professional advisors to investigate the matter or circumstance alleged to give rise to the Direct Claim, and whether and to what extent any amount is payable in respect of the Direct Claim and the Indemnified Party shall assist the Indemnifying Party’s investigation by giving such information and assistance as the Indemnifying Party or any of its professional advisors may reasonably request. If the Indemnifying Party does not so respond within such thirty (30) calendar day period, the Indemnifying Party shall be deemed to have accepted liability for such claim, in which case the Indemnified Party shall be free to pursue such remedies as may be available to the Indemnified Party on the terms and subject to the provisions of this Agreement. |
| (d) | Cooperation. Upon a reasonable request made by the Indemnifying Party, each Indemnified Party seeking indemnification hereunder in respect of any Direct Claim, hereby agrees to consult with the Indemnifying Party and act reasonably to take actions reasonably requested by the Indemnifying Party in order to attempt to reduce the amount of Losses in respect of such Direct Claim. Any costs or expenses associated with taking such actions shall be included as Losses hereunder. |
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Section 8.05 Payments. Upon a determination of liability under this Article VIII, the Indemnifying Party shall pay or cause to be paid to the Indemnified Party the amount so determined within five (5) Business Days after the date of such determination. If there should be a dispute as to the amount or manner of determination of any indemnity obligation owed under this Agreement, the Indemnifying Party shall nevertheless pay when due such portion, if any, of the obligation that is not subject to dispute. Upon the payment in full of any amounts due under this Article VIII with respect to any claim, the Indemnifying Party shall be subrogated to the rights of the Indemnified Party against any Person with respect to the subject matter of such claim.
Section 8.06 Certain Limitations. The indemnification provided for in Section 8.02 and Section 8.03 shall be subject to the following limitations:
| (a) | Geo Impex shall not be liable to the ConnectM Indemnified Parties for indemnification under Section 8.02 (other than with respect to a claim for indemnification based upon, arising out of, with respect to or by reason of fraud or any inaccuracy in or breach of any of the Surviving Representations (the “Geo Impex Basket Exclusions”)) until the aggregate amount of all Losses in respect of indemnification under Section 8.02 (other than those based upon, arising out of, with respect to or by reason of the Geo Impex Basket Exclusions) exceeds $10,000 (the “Basket”), in which event Geo Impex shall be required to pay or be liable for all such Losses in excess of the Basket. |
| (b) | ConnectM shall not be liable to Geo Impex Indemnified Parties for indemnification under and Section 8.03 until the aggregate amount of all Losses in respect of indemnification under Section 8.03 exceeds the Basket, in which event ConnectM shall be required to pay or be liable for all such Losses in excess of the Basket. |
| (c) | The Parties acknowledge and agree that the maximum liability of Geo Impex, on the one hand, and ConnectM, on the other hand, for indemnification pursuant to this Article VIII shall be the sum of $11,920,000 (the “Cap”), and neither Geo Impex, on the one hand, or ConnectM, on the other hand, shall have any liability to the other in excess of the Cap. |
Section 8.07 Tax Treatment of Indemnification Payments. All indemnification payments made under this Agreement shall be treated by the Parties as an adjustment to the consideration paid hereunder unless otherwise required by applicable Laws.
Section 8.08 Effect of Investigation. The representations, warranties and covenants of the Indemnifying Party, and the Indemnified Party’s right to indemnification with respect thereto, shall not be affected or deemed waived by reason of any investigation, ) made at any time, whether before or after the execution and delivery of this Agreement, with respect to the accuracy or inaccuracy of or compliance with any such representation, warranty, covenant or obligation, and made by or on behalf of the Indemnified Party (including by any of its Representatives) or by reason of the fact that the Indemnified Party or any of its Representatives knew or should have known that any such representation or warranty is, was or might be inaccurate. The waiver of any condition based upon the accuracy of any representation or warranty, or on the performance of or compliance with any covenant or obligation, shall not affect the right to indemnification, reimbursement or other remedy based upon such representations, warranties, covenants or obligations.
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Section 8.09 Exclusive Remedy. In the event that the Closing occurs, the indemnification provisions contained in this Article VIII shall be the sole and exclusive remedy of the Parties with respect to the Transactions for any and all breaches or alleged breaches of any representations, warranties, covenants or agreements of the Parties or any other provision of this Agreement or arising out of the Transactions, except (i) with respect to any equitable remedy to which such Party may be entitled to with respect to any claims or causes of action arising from the breach of any covenants or agreement of a Party that is to be performed subsequent to the Closing Date, or (ii) with respect to a Party, an actual and intentional fraud with respect to this Agreement and the Transactions. In furtherance of the foregoing, each Party hereto, for itself and on behalf of its Affiliates, hereby waives, from and after the Closing, to the fullest extent permitted under applicable Laws and except as otherwise specified in this Article VIII or in Section 9.05, any and all rights, claims and causes of action it may have against any other Party hereto relating to the subject matter of this Agreement or any other agreement, certificate or other document or instrument delivered pursuant to this Agreement, arising under or based upon any applicable Laws.
Article IX. Miscellaneous
Section 9.01 Notices.
| (a) | Any notice or other communications required or permitted hereunder shall be in writing and shall be sufficiently given if personally delivered to it or sent by email, overnight courier or registered mail or certified mail, postage prepaid, addressed as follows: |
if to any ConnectM Party, or if to Geo Impex India or Global Impex following the Closing, to:
ConnectM Technology Solutions, Inc.
Attn: Bhaskar Panigrahi
2 Mount Royal Avenue, Suite 550
Marlborough, Massachusetts 01752
Email: [email protected]
With a copy, which shall not constitute notice, to:
Anthony, Linder & Cacomanolis, PLLC
Attn: John Cacomanolis
1700 Palm Beach Lakes Blvd., Suite 820
West Palm Beach, FL 33401
Email: [email protected]
If to Geo Impex or Marsh CDM, or if to Geo Impex India or Global Impex prior to the Closing, to:
Geo Impex LLC
Attn: Tejesh Kodali
IT CORPZ INC
510 Thornall St, suite 135
Edison, NJ 08837
Email: [email protected]
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With a copy to:
Marsh CDM Services Pvt Ltd.
Attn: Vikas Dongarkar
# 6-2-975, Flat No. B-409, Kushal Towers, Khairatabad, Hyderabad – 500004, State of Telangana
Email: [email protected]
With a copy, which shall not constitute notice, to:
[__________________]
[__________________]
[__________________]
Email: [__________________]
| (b) | Any Party may change its address for notices hereunder upon notice to each other Party in the manner for giving notices hereunder. |
| (c) | Any notice hereunder shall be deemed to have been given (i) upon receipt, if personally delivered, (ii) on the day after dispatch, if sent by overnight courier, (iii) upon dispatch, if transmitted by email with return receipt requested and received and (iv) three (3) days after mailing, if sent by registered or certified mail. |
Section 9.02 Governing Law. Agreement, and all matters based upon, arising out of or relating in any way to the Transactions, including, without limitation, tort claims, statutory claims and contract claims, shall be interpreted, construed, governed and enforced under and in accordance with the substantive and procedural Laws of the State of Delaware in each case as in effect from time to time and as the same may be amended from time to time, and as applied to agreements performed wholly within the State of Delaware. Notwithstanding the foregoing, to the extent required to give effect thereto, the sale of the Geo Impex India Shares shall be governed by the Laws of India.
Section 9.03 Jurisdiction. ANY LEGAL SUIT, ACTION OR PROCEEDING ARISING OUT OF OR BASED UPON THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREIN SHALL BE INSTITUTED SOLELY IN THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA OR THE COURTS OF THE STATE OF MASSACHUSETTES, IN EACH CASE LOCATED IN MIDDLESEX COUNTY, MASSACHUSETTES, AND EACH PARTY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF SUCH COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING. SERVICE OF PROCESS, SUMMONS, NOTICE OR OTHER DOCUMENT BY MAIL TO SUCH PARTY’S ADDRESS SET FORTH HEREIN SHALL BE EFFECTIVE SERVICE OF PROCESS FOR ANY SUIT, ACTION OR OTHER PROCEEDING BROUGHT IN ANY SUCH COURT. THE PARTIES IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY OBJECTION TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR ANY PROCEEDING IN SUCH COURTS AND IRREVOCABLY WAIVE AND AGREE NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
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Section 9.04 Waiver of Jury Trial. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS, THE PERFORMANCE THEREOF OR THE FINANCINGS CONTEMPLATED THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.04. EACH OF THE PARTIES ACKNOWLEDGE THAT EACH HAS BEEN REPRESENTED IN CONNECTION WITH THE SIGNING OF THE WAIVER ABOVE BY INDEPENDENT LEGAL COUNSEL SELECTED BY THE RESPECTIVE PARTY AND THAT SUCH PARTY HAS DISCUSSED THE LEGAL CONSEQUENCES AND IMPORT OF THIS WAIVER WITH LEGAL COUNSEL. EACH OF THE PARTIES FURTHER ACKNOWLEDGE THAT EACH HAS READ AND UNDERSTANDS THE MEANING OF SUCH WAIVER AND GRANTS THIS WAIVER KNOWINGLY, VOLUNTARILY, WITHOUT DURESS AND ONLY AFTER CONSIDERATION OF THE CONSEQUENCES OF THIS WAIVER WITH LEGAL COUNSEL.
Section 9.05 Specific Performance. The Parties agree that irreparable damage would occur if any provision of this Agreement were not performed in accordance with the terms hereof and that the Parties shall be entitled to specific performance of the terms hereof, in addition to any other remedy to which they are entitled at Laws or in equity.
Section 9.06 Limitation on Damages. in no event will any party be liable to any other party under or in connection with this agreement or in connection with the transactions for special, general, indirect or consequential damages, including damages for lost profits or lost opportunity, even if the party sought to be held liable has been advised of the possibility of such damages.
Section 9.07 Attorneys’ Fees. In the event that any Party institutes any action or suit to enforce this Agreement or to secure relief from any default hereunder or breach hereof, the prevailing Party shall be reimbursed by the losing Party for all costs, including reasonable attorneys’ fees, incurred in connection therewith and in enforcing or collecting any judgment rendered therein.
Section 9.08 Public Announcements and Filings. Unless required by applicable Laws or regulatory authority, or the rules and regulations of any securities market on which the securities of ConnectM are listed or available for trading, none of the Parties will issue any report, statement or press release to the general public, trade or trade press, or to any third party (other than its advisors and representatives in connection with Transactions) or file any document, relating to this Agreement and Transactions, except as may be mutually agreed by the Parties. Copies of any such filings, public announcements or disclosures, including any announcements or disclosures mandated by Laws or regulatory authorities, shall be delivered to each Party prior to the release thereof.
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Section 9.09 Third-Party Beneficiaries. This Agreement is strictly between the Parties and, except as specifically provided, no director, officer, stockholder, member (other than Geo Impex), employee, agent, independent contractor or any other Person shall be deemed to be a third-Party beneficiary of this Agreement.
Section 9.10 Expenses. Except as specifically set forth herein, whether or not the Transactions are consummated, each of the Parties will bear their own respective expenses, including without limitation the fees and expenses of its legal, accounting and financial advisors, incurred in connection with the Exchange or any of the other Transactions.
Section 9.11 Entire Agreement. This Agreement and the other Transaction Documents represent the entire agreement between the Parties relating to the subject matter thereof and supersede all prior agreements, understandings and negotiations, written or oral, with respect to such subject matter. If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction. Upon such determination that any term or other provision is invalid, illegal or unenforceable, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in a mutually acceptable manner in order that the Transactions be consummated as originally contemplated to the greatest extent possible.
Section 9.12 Construction. The table of contents and headings contained in this Agreement are for reference purposes only and will not affect in any way the meaning or interpretation of this Agreement.
Section 9.13 Amendment or Waiver.
| (a) | This may be amended, modified, superseded, terminated or cancelled, and any of the terms, covenants, representations, warranties or conditions hereof may be waived, only by a written instrument executed by both of the Parties, provided that any of the conditions in Article III may be waived by the Party for whose benefit such condition exists. |
| (b) | Every right and remedy provided herein shall be cumulative with every other right and remedy, whether conferred herein, at law, or in equity, and may be enforced concurrently herewith, and no waiver by any Party of the performance of any obligation by another Party shall be construed as a waiver of the same or any other default then, theretofore, or thereafter occurring or existing. |
| (c) | Neither any failure or delay in exercising any right or remedy hereunder or in requiring satisfaction of any condition herein nor any course of dealing shall constitute a waiver of or prevent any Party from enforcing any right or remedy or from requiring satisfaction of any condition. No notice to or demand on a Party waives or otherwise affects any obligation of that Party or impairs any right of the Party giving such notice or making such demand, including any right to take any action without notice or demand not otherwise required by this Agreement. No exercise of any right or remedy with respect to a breach of this Agreement shall preclude exercise of any other right or remedy, as appropriate to make the aggrieved Party whole with respect to such breach, or subsequent exercise of any right or remedy with respect to any other breach. |
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Section 9.14 Commercially Reasonable Efforts. Subject to the terms and conditions herein provided, each Party shall use its commercially reasonable efforts to perform or fulfill all conditions and obligations to be performed or fulfilled by it under this Agreement so that Transactions shall be consummated as soon as practicable. Each Party also agrees that it shall use its commercially reasonable efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary, proper or advisable under applicable Laws and regulations to consummate and make effective this Agreement and the Transactions.
Section 9.15 Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the Parties and their respective successors and permitted assigns. No Party shall have any power or any right to assign or transfer, in whole or in part, this Agreement, or any of its rights or any of its obligations hereunder, including, without limitation, any right to pursue any claim for damages pursuant to this Agreement or the transactions contemplated herein, or to pursue any claim for any breach or default of this Agreement, or any right arising from the purported assignor’s due performance of its obligations hereunder, including by merger, consolidation, operation of law, or otherwise, without the prior written consent of the other Parties and any such purported assignment in contravention of the provisions herein shall be null and void and of no force or effect. Other than as specifically set forth herein, including in Article VIII, nothing in this Agreement shall confer on any Person other than the Parties, and their respective successors and assigns, any rights, remedies, obligations, or Liabilities under or by reason of this Agreement.
Section 9.16 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original and all of which taken together shall be but a single instrument. A signed copy of this Agreement delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.
[Signature Pages Follow]
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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date.
| ConnectM Technology Solutions, Inc. | ||
| By: | /s/ Bhaskar Panigrahi | |
| Name: | Bhaskar Panigrahi | |
| Title: | Chief Executive Officer | |
| ConnectM India Pvt Ltd. | ||
| By: | /s/ Girish Subramanya | |
| Name: | Girish Subramanya | |
| Title: | Managing Director | |
| Geo Impex LLC | ||
| By: | /s/ Tejesh Kodali | |
| Name: | Tejesh Kodali | |
| Title: | President | |
| Global Impex LLC | ||
| By: | /s/ Tejesh Kodali | |
| Name: | Tejesh Kodali | |
| Title: | President | |
| Marsh CDM Services Pvt Ltd. | ||
| By: | /s/ Vikas Dongarkar | |
| Name: | Vikas Dongarkar | |
| Title: | Director | |
| Geo Impex & Logistics Pvt Ltd. | ||
| By: | /s/ Ranjan Swain | |
| Name: | Ranjan Swain | |
| Title: | Managing Director | |
| 38 |
Exhibit A
Promissory Note
(Attached)
Exhibit B
Assignment of Membership Interests
(Attached)
Exhibit C
Stock Power for Marsh CDM/Geo Impex India Shares
(Attached)
Exhibit 10.1
THIS CONVERTIBLE PROMISSORY NOTE (THIS “NOTE”) AND THE SECURITIES INTO WHICH IT MAY BE CONVERTED HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER THE SECURITIES LAWS OF ANY STATE. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE. THIS NOTE HAS BEEN ACQUIRED FOR INVESTMENT ONLY AND MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED EXCEPT AS PERMITTED UNDER THE SECURITIES ACT AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE MAKER MAY REQUIRE AN OPINION OF COUNSEL REASONABLY SATISFACTORY IN FORM, SCOPE AND SUBSTANCE TO THE MAKER TO THE EFFECT THAT ANY SALE OR OTHER DISPOSITION IS IN COMPLIANCE WITH THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS.
CONVERTIBLE PROMISSORY NOTE
| Total Principal Amount: $[ ] | Dated as of [ ] |
FOR VALUE RECEIVED and subject to the terms and conditions set forth herein, ConnectM Technology Solutions, Inc., a Delaware corporation (the “Maker”), promises to pay to [ ] residing at [ ]or its registered assigns or successors in interest (the “Payee”), the Principal Amount (as defined below) in lawful money of the United States of America, on the terms and conditions described below. All payments on this Note shall be made by check or wire transfer of immediately available funds or as otherwise determined by the Maker to such account as the Payee may from time to time designate by written notice in accordance with the provisions of this Note.
1. Principal. The initial principal balance of this Note of $[ ], shall be funded on the date hereof by the Payee (the “Principal Amount”). Any unpaid Principal Amount and interest accrued thereon not converted pursuant to Section 7 hereof, shall be payable on the date that is [ ] days from the date hereof (the “Maturity Date”), unless accelerated upon the occurrence of an Event of Default (as defined below). Any balance under the Note may be prepaid at any time. Under no circumstances shall any individual, including but not limited to any officer, director, employee or shareholder of the Maker, be obligated personally for any obligations or liabilities of the Maker hereunder.
2. Interest. Interest shall accrue on the unpaid principal balance of this Note at the rate of twenty percent (20%) per annum.
3. Application of Payments. All payments shall be applied first to payment in full of any costs incurred in the collection of any sum due under this Note, including (without limitation) reasonable attorney’s fees, then to the payment in full of any late charges and finally to the reduction of the unpaid principal balance of this Note.
4. Purpose. The Maker shall apply the amounts advanced by the Payee under this Note towards the Maker’s working capital requirements.
5. Events of Default. Each of the following shall constitute an event of default (“Event of Default”):
(a) Failure to Perform Obligations. Failure by the Maker to perform its obligations with respect to the conversion of the Principal Amount of this Note into Conversion Shares (as defined below) pursuant to Section 7 hereof or to otherwise satisfy its obligations under this Note.
(b) Voluntary Bankruptcy, Etc. The commencement by the Maker of a voluntary case under any applicable bankruptcy, insolvency, reorganization, rehabilitation or other similar law, or the consent by it to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other similar official) of the Maker or for any substantial part of its property, or the making by it of any assignment for the benefit of creditors, or the failure of the Maker generally to pay its debts as such debts become due, or the taking of corporate action by the Maker in furtherance of any of the foregoing.
(c) Involuntary Bankruptcy, Etc. The entry of a decree or order for relief by a court having jurisdiction in the premises in respect of the Maker in an involuntary case under any applicable bankruptcy, insolvency or other similar law, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar official) of the Maker or for any substantial part of its property, or ordering the winding-up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of sixty (60) consecutive days.
6. Remedies.
(a) Upon the occurrence of an Event of Default specified in Section 5(a) hereof, the Payee may, by written notice to the Maker, declare this Note to be due immediately and payable, whereupon the unpaid Principal Amount of this Note, and all other amounts payable hereunder, shall become immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived, anything contained herein or in the documents evidencing the same to the contrary notwithstanding.
(b) Upon the occurrence of an Event of Default specified in Section 5(b) and Section 5(c), the unpaid principal balance of this Note, and all other sums payable with regard to this Note, shall automatically and immediately become due and payable, in all cases without any action on the part of the Payee.
7. Voluntary Conversion.
(a) Conversion. At any time and from time to time, commencing on the date hereof, through the date that is 210 days from the date hereof, the outstanding Principal Amount and any interest accrued thereon under the Note shall be convertible, at the option of the Payee, into that number of fully paid and non-assessable shares (the “Conversion Shares”) of Common Stock, par value $0.0001 per share of the Company equal to [ ].
As to any fraction of a share of Common Stock which the Note holder would otherwise be entitled to acquire upon such conversion, the Company will either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the fair market value of a share of Common Stock as determined in good faith by the Board, or round up to the next whole share of Common Stock.
(b) Conversion Procedure. Not later than three (3) business days after the Company’s receipt of the Conversion Notice (the “Share Delivery Date”), the Company shall deliver, or cause to be delivered, to the Payee a certificate or certificates representing the Conversion Shares, which, on or after the date on which the resale of such Conversion Shares are covered by and are being sold pursuant to an effective Registration Statement or such Conversion Shares are eligible to be sold under Rule 144 without the need for current public information and the Company has received an opinion of counsel to such effect acceptable to the Company (which opinion the Company will be responsible for obtaining at its own cost) shall be free of restrictive legends and trading restrictions (other than those which may then be required by federal securities laws) representing the number of Conversion Shares being acquired or being sold, as the case may be, upon the conversion of this Note. All certificate or certificates required to be delivered by the Company under this Section 7(b) shall be delivered electronically through DTC or another established clearing corporation performing similar functions, unless the Company or its Transfer Agent does not have an account with DTC and/or is not participating in the DTC/FAST System, in which case the Company shall issue and deliver to the address as specified in such Notice of Conversion a certificate (or certificates), registered in the name of the Payee or its designee, for the number of Conversion Shares to which the Payee shall be entitled. If the Conversion Shares are not being sold pursuant to an effective Registration Statement or if the Conversion Date is prior to the date on which such Conversion Shares are eligible to be sold under Rule 144 without the need for current public information, the Conversion Shares shall bear a restrictive legend in the following form, as appropriate:
“THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT.”
(c) Reservation of Shares Issuable Upon Conversion. The Company shall at all times reserve and keep available out of its authorized but unissued Common Stock, solely for the purpose of effecting the conversion of this Note such number of Conversion Shares as shall from time to time be sufficient to effect the conversion of the Note; and if at any time the number of authorized but unissued Common Stock shall not be sufficient to effect the conversion of the entire outstanding Principal Amount of this Note, without limitation of such other remedies as shall be available to the Payee, the Company will use its reasonable best efforts to take such corporate action as may, in the opinion of counsel, be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purposes.
(d) Fractional Shares. No fractional shares or scrip representing fractional shares shall be issued upon the conversion of this Note. As to any fraction of a share that the Payee would otherwise be entitled to purchase upon such conversion, the Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Conversion Price or round up to the next whole share.
8. Covenants of the Maker. The Maker covenants that any Conversion Shares issuable upon conversion of the Note, when so issued, will be validly issued, fully paid and nonassessable and free from all taxes, liens and charges with respect to the issuance thereof.
9. Waivers. The Maker and all endorsers and guarantors of, and sureties for, this Note waive presentment for payment, demand, notice of dishonor, protest, and notice of protest with regard to the Note, all errors, defects and imperfections in any proceedings instituted by the Payee under the terms of this Note, and all benefits that might accrue to the Maker by virtue of any present or future laws exempting any property, real or personal, or any part of the proceeds arising from any sale of any such property, from attachment, levy or sale under execution, or providing for any stay of execution, exemption from civil process, or extension of time for payment; and the Maker agrees that any real estate that may be levied upon pursuant to a judgment obtained by virtue hereof, on any writ of execution issued hereon, may be sold upon any such writ in whole or in part in any order desired by the Payee.
10. Unconditional Liability. The Maker hereby waives all notices in connection with the delivery, acceptance, performance, default, or enforcement of the payment of this Note, and agrees that its liability shall be unconditional, without regard to the liability of any other party, and shall not be affected in any manner by any indulgence, extension of time, renewal, waiver or modification granted or consented to by the Payee, and consents to any and all extensions of time, renewals, waivers, or modifications that may be granted by the Payee with respect to the payment or other provisions of this Note, and agrees that additional makers, endorsers, guarantors, or sureties may become parties hereto without notice to the Maker or affecting the Maker’s liability hereunder.
11. Notices. All notices, statements or other documents which are required or contemplated by this Note shall be: (i) in writing and delivered personally or sent by first class registered or certified mail, overnight courier service or facsimile or electronic transmission to the address designated in writing, (ii) by facsimile to the number most recently provided to such party or such other address or fax number as may be designated in writing by such party or (iii) by electronic mail, to the electronic mail address most recently provided to such party or such other electronic mail address as may be designated in writing by such party. Any notice or other communication so transmitted shall be deemed to have been given on the day of delivery, if delivered personally, on the business day following receipt of written confirmation, if sent by facsimile or electronic transmission, one (1) business day after delivery to an overnight courier service or five (5) days after mailing if sent by mail.
12. Construction. THIS NOTE SHALL BE GOVERNED AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS THEREOF.
13. Severability. Any provision contained in this Note which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.
15. Amendment; Waiver. Any amendment hereto or waiver of any provision hereof may be made with, and only with, the written consent of the Maker and the Payee.
16. Successors and Assigns. Subject to the restrictions on transfer in Section 18 and Section 19 the rights and obligations of the Maker and the Payee hereunder shall be binding upon and benefit the successors, assigns, heirs, administrators and transferees of any party hereto (by operation of law or otherwise) with the prior written consent of the other party hereto and any attempted assignment without the required consent shall be void.
17. Transfer of this Note or Securities Issuable on Conversion. With respect to any sale or other disposition of this Note or Conversion Shares, the Payee shall give written notice to the Maker prior thereto, describing briefly the manner thereof, together with a written opinion (unless waived by the Maker) reasonably satisfactory to the Maker in form and substance from counsel reasonably satisfactory to the Maker to the effect that such sale or other distribution may be effected without registration or qualification under any U.S. federal or state law then in effect. Upon receiving such written notice and reasonably satisfactory opinion and/or certificate (unless waived by the Maker), or other evidence, and such written acknowledgement, the Maker, as promptly as practicable, shall notify the Payee that the Payee may sell or otherwise dispose of this Note or Conversion Securities, all in accordance with the terms of the note delivered to the Maker. If a determination has been made pursuant to this Section 17 that the opinion of counsel for the Payee or other evidence is not reasonably satisfactory to the Maker, the Maker shall so notify the Payee promptly after such determination has been made. Any Note thus transferred shall bear a legend as to the applicable restrictions on transferability in order to ensure compliance with the Securities Act, unless in the opinion of counsel for the Maker such legend is not required in order to ensure compliance with the Securities Act. The Maker may issue stop transfer instructions to its transfer agent in connection with such restrictions. Subject to the foregoing, transfers of this Note shall be registered upon registration on the books maintained for such purpose by or on behalf of the Maker. Prior to presentation of this Note for registration of transfer, the Maker shall treat the registered holder hereof as the owner and holder of this Note for the purpose of receiving all payments of principal hereon and for all other purposes whatsoever, whether or not this Note shall be overdue and the Maker shall not be affected by notice to the contrary.
18. Acknowledgment. The Payee is acquiring this Note for investment for its own account, not as a nominee or agent, and not with a view to, or for resale in connection with, any distribution thereof in violation of applicable securities laws. The Payee understands that the acquisition of this Note involves substantial risk. The Payee has experience as an investor in securities of companies and acknowledges that it is able to fend for itself, can bear the economic risk of its investment in this Note, and has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of this investment in this Note and protecting its own interests in connection with this investment.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the Maker, intending to be legally bound hereby, has caused this Note to be duly executed by the undersigned as of the day and year first written above.
| ConnectM Technology Solutions, Inc., a Delaware Corporation | |||
| By: | |||
| Name: Bhaskar Panigrahi | |||
| Title: Chief Executive Officer | |||
Agreed and acknowledged as of the date first written above:
| By: | |||
| Name: [ ] | |||
| Address: [ ] | |||
| Title: [ ] | |||
Annex A
[FORM OF NOTICE OF CONVERSION]
| To: | [Name and Address of Conversion Agent/the Company] |
The undersigned holder of this Note hereby exercises the option to convert this Note, into shares of Common Stock in accordance with the terms of the Note, and directs that the shares of Common Stock issuable and deliverable upon such conversion be issued and delivered to the Payee unless a different name has been indicated below. If any shares of Common Stock are to be issued in the name of a person other than the undersigned, the undersigned will pay all documentary, stamp or similar issue or transfer taxes in connection with such issuance. Capitalized terms used herein but not defined shall have the meanings ascribed to such terms in the Note.
| Dated: | |||
| Signature | |||
| Signature Guarantee | |||
| [Signature(s) must be guaranteed by an eligible guarantor institution (banks, stock brokers, savings and loan associations and credit unions) with membership in an approved signature guarantee medallion program pursuant to Securities and Exchange Commission Rule 17Ad-15 if shares of Common Stock are to be issued, or Notes are to be delivered, other than to and in the name of the registered holder.] |
| Fill in for registration of shares if to be issued,and Notes if to be delivered, other than to and in the name of the registered holder: |
| (Name) | |
| (Street Address) | |
| (City, State and Zip Code) | |
| Please print name and address | |
| Principal amount, together with accrued but unpaid interest on, the Note to be converted (if less than all): | |
| $__________ | |
| Number of Conversion Shares: _______________ | |
| NOTICE: The above signature of the Payee hereof must correspond with the name as written upon the face of the Note in every particular without alteration or enlargement or any change whatever. | |
| Social Security or Other Taxpayer Identification Number: |
Exhibit 10.2
LABRYS FUND II, LP
145 Tremont Street, Suite 201-1408, Boston, MA 02111
| Tel: 781/729-0720 | Date: 10/23/2025 |
Discussion Purposes Only & Confidential
TERM SHEET IS NULL AND VOID IF NOT RETURNED WITHIN 48 HOURS OF THE DATE HEREOF
This Term Sheet sets forth the indicative terms pursuant to which, subject to certain conditions set forth herein and in definitive documentation, the Investor(s) would purchase certain securities of the Issuer, and the Issuer would sell such securities to the Investor(s). The terms and conditions set forth herein are subject to change and this Term Sheet does not constitute an offer. The issuance and sale of such securities is subject to, among other things, completion of due diligence to the satisfaction of the Investor(s) and their counsel, the preparation of definitive documentation to effect the transactions that is mutually satisfactory to each party and, in the case of the Investor(s), that the Investor(s) shall have determined that subsequent to the date hereof and prior to the closing of the transactions, there shall have been no material adverse developments relating to the business, assets, operations, properties, condition or prospects of the Issuer and its subsidiaries, taken as a whole.
| Issuer: | ConnectM Technology Solutions, Inc., Ticker: OTCQB: CNTM (the “Company”) | |
| Investor: | Labrys Fund II, LP (“Labrys II”). | |
| Principal Amount: | $275,000.00 Promissory Note (“Note”). | |
| Original Issue Discount (OID): | $25,000. Representing a ten percent (10%) Original Issue Discount (“OID”). | |
| Purchase Price: | Company nets $250,000.00 before fees. | |
| Maturity Date: | The Note will mature twelve (12) months after Note execution date (“Issuance”), subject to acceleration following default. | |
| Coupon: | A one-time interest charge of ten percent (10%) (the “Guaranteed Interest”) shall be applied on the Issuance Date to the principal amount ($275,000.00 * 10% = $27,500.00). | |
| Pre-Payment Terms: | The Company shall have the right exercisable on not more than three (3) Trading Days prior written notice to the Investor to prepay the outstanding Principal Amount and interest then due under this Note, in full based on the below schedule: | |
| The period beginning on the Issue Date and ending on the date which is sixty (60) days following the Issue Date at 95%, The period beginning on date which is sixty-one (61) days following the Issue Date and ending on the date which is ninety (90) days following the Issue Date at 96%, The period beginning on date which is ninety- one (91) days following the Issue Date and ending on the date which is one hundred fifty (150) days following the Issue Date at 97% and the period beginning on date which is one hundred fifty- one (151) days following the Issue Date and ending on the date which is one hundred eighty (180) days following the Issue Date at 98% of the total amount then due. |
| Page 1 | 4 |
LABRYS FUND II, LP
145 Tremont Street, Suite 201-1408, Boston, MA 02111
| Tel: 781/729-0720 | Date: 10/23/2025 |
Discussion Purposes Only & Confidential
| Amortization Payment: | Guaranteed Interest and outstanding principal, subject to adjustment, shall be paid monthly (each, an “Amortization Payment”). First payment due one hundred eighty (180) calendar days from the Issuance Date in the amount of $43,214.28 with six (6) subsequent payments each month thereafter in the amount of $43,214.28 (a total payback to the Investor of $302,500). The Company has the right to accelerate payments or prepay in full at any time with no prepayment penalty. | |
| Conversion Price: | The Conversion Price shall mean 75% multiplied by the lowest closing bid price for the Common Stock during the fifteen (15) Trading Days prior to the Conversion Date (representing a discount rate of 25%); subject to adjustment. | |
| Conversion Date: | Immediately following the last of the following to occur, (i) the date which is one hundred eighty (180) days following the date hereof; and (ii) the occurrence of an Event of Default, the Holder shall have the right, to convert all or any portion of the then outstanding and unpaid Principal Amount, OID, and Interest (including any Default Interest) into fully paid and non-assessable shares of the Company’s Common Stock. | |
| Commitment Shares: | None. | |
| Closing Date: | On or about one week from the date of this Term Sheet. Contingent upon fully signed definitive documents and further review of the Company’s filings. | |
| Additional Investment Right: | TA Termination Authorization. |
| Page 2 | 4 |
LABRYS FUND II, LP
145 Tremont Street, Suite 201-1408, Boston, MA 02111
| Tel: 781/729-0720 | Date: 10/23/2025 |
Discussion Purposes Only & Confidential
| Warrants: | None | |
| Legal Amounts: | Upon Closing, the Company will be obligated to pay the amount of $3,750.00 to Anthony P, LLC (the “Escrow Agent”) to prepare documentation for the proposed transaction. | |
| Reservation of Conversion Shares at Transfer Agent: | Initially, 7,503,875 shares, but at all times three times (3x) coverage based off the Guaranteed Interest and Principal Amount divided by the Default Conversion Price one day prior to closing (the “Reservation”) so that enough shares are necessary to fully convert the Note (including interest or default amounts, if applicable) shall be reserved by the Company and its Transfer Agent at Issuance. | |
| Definitive Documents: | The definitive documents shall contain such additional provisions, including without limitation representations, warranties, covenants, agreements and remedies, as are typical for transactions of this type. Documents may include one or all of the following: Convertible Note; Convertible Note Purchase Agreement; Irrevocable Transfer Agent Instructions; Instructions and Authorization to Transfer Agent; Officer's Certificate; Board Resolutions; Certificate of Good Standing. | |
| Governing Law and Jurisdiction: | Delaware law; Massachusetts jurisdiction. | |
| Confidentiality: | The Company acknowledges the confidentiality of this term sheet and agrees not to distribute or discuss with any third party the contents contained herein and agrees to use it best efforts to prevent its dissemination of such contents. In addition the Company agrees that it will not disclose, and will not include in any public announcement, the name of the investor(s), unless expressly agreed to by the Investor(s) or unless and until such disclosure is required by law or applicable regulation, and then only to the extent of such requirement. In the event that such disclosure is required by law or applicable regulation, the Company shall provide notice of such disclosed to the Investor(s). |
| Page 3 | 4 |
LABRYS FUND II, LP
145 Tremont Street, Suite 201-1408, Boston, MA 02111
| Tel: 781/729-0720 | Date: 10/23/2025 |
Discussion Purposes Only & Confidential
Neither this Term Sheet nor any discussion or negotiation of the proposed transaction constitutes an agreement or obligation on the part of any person to purchase securities of the Company or enter into any agreement to purchase securities of the Company. Any such agreement or obligation shall arise with respect to a particular Investor solely upon execution and delivery to the Issuer by such Investor of definitive documents acceptable to such Investor.
| Issuer: | ||
| ConnectM Technology Solutions, Inc | ||
| By: | /s/ Bhaskar Panigrahi | |
| Name: Bhaskar Panigrahi | ||
| Title: Chief Executive Officer | ||
| Page 4 | 4 |
Exhibit 10.3
Funding date
Time:
DISBURSEMENT AUTHORIZATION
| TO: | Vanquish Funding Group Inc. |
| FROM: | ConnectM Technology Solutions, Inc. |
| Tranche #__ -________ (CNTM)
Bridge Note 2 Mount Royal Avenue, Suite 550 Marlborough, Massachusetts 01752 |
|
| DATE: | October 1, 2025 |
| RE: | Disbursement of Funds for the Purchase of Securities |
In connection with the funding of an aggregate of $230,160.00 (which includes an Original Issue Discount of $24,660.00) pursuant to that certain Securities Purchase Agreement dated as of October 1, 2025 (the "Agreement"), you are hereby directed to disburse such funds as follows:
| 1. | $188,000.00 to ConnectM Technology Solutions, Inc. (the “Company”) in accordance with the wire transfer instructions attached as Schedule A hereto; |
| 1. | $12,000.00 to Digital Offering LLC, a registered Broker/Dealer and member FINRA/SIPC, in accordance with the wire transfer instructions attached as Schedule B hereto; |
| 2. | $2,000.00 to Naidich Wurman LLP for legal fee reimbursement; and |
| 3. | $3,500.00 to be retained by Vanquish Funding Group Inc. for a due diligence fee. |
Upon receipt of such funds, you may release from escrow the Note, the Purchase Agreement and the instructions to Transfer Agent (each as defined in the Agreement).
| /s/ Bhaskar Panigrahi | |
| Bhaskar Panigrahi | |
| Chief Executive Officer |
Schedule A
Bank Name: TBD
Account Name:
Swift Code:
Routing #:
Account#:
Bank Address:
Schedule B
Wiring Instructions:
Chase Bank
30202 Crown Valley Parkway
Laguna Niguel, CA 92677
ABA Routing #: 322271627
Credit Account #: 682012870
Account Name: Digital Offering LLC
EIN: 46-0619588
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT.
THE ISSUE PRICE OF THIS NOTE IS $230,160.00
THE ORIGINAL ISSUE DISCOUNT IS $24,660.00
| Principal Amount: $230,160.00 | Issue Date: October 1, 2025 |
| Purchase Price: $205,500.00 |
PROMISSORY NOTE
FOR VALUE RECEIVED, ConnectM Technology Solutions, Inc., a Delaware corporation (hereinafter called the “Borrower”), hereby promises to pay to the order of Vanquish Funding Group Inc. a Virginia corporation, or registered assigns (the “Holder”) the sum of $230,160.00 together with any interest as set forth herein, on July 30, 2026 (the “Maturity Date”), and to pay interest on the unpaid principal balance hereof from the date hereof (the “Issue Date”) as set forth herein. This Note may not be prepaid in whole or in part except as otherwise explicitly set forth herein. Any amount of principal or interest on this Note which is not paid when due shall bear interest at the rate of twenty two percent (22%) per annum from the due date thereof until the same is paid (“Default Interest”). All payments due hereunder (to the extent not converted into common stock, $0.0001 par value per share (the “Common Stock”) in accordance with the terms hereof) shall be made in lawful money of the United States of America. All payments shall be made at such address as the Holder shall hereafter give to the Borrower by written notice made in accordance with the provisions of this Note. Each capitalized term used herein, and not otherwise defined, shall have the meaning ascribed thereto in that certain Securities Purchase Agreement dated the date hereof, pursuant to which this Note was originally issued (the “Purchase Agreement”).
This Note is free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the Borrower and will not impose personal liability upon the holder thereof.
The following terms shall apply to this Note:
ARTICLE I. GENERAL TERMS
1.1 Interest. A one-time interest charge of twelve percent (12%) (the “Interest Rate”) shall be applied on the Issuance Date to the Principal ($230,160.00 * twelve percent (12%) = $27,619.00). Interest hereunder shall be paid as set forth herein to the Holder or its assignee in whose name this Note is registered on the records of the Company regarding registration and transfers of Notes in cash or, in the Event of Default, at the Option of the Holder, converted into share of Common Stock as set forth herein.
1.2 Mandatory Monthly Payments. Accrued, unpaid interest and outstanding principal, subject to adjustment, shall be paid in five (5) payments as follows:
| Payment Date | Amount of Payment | |||
| March 30, 2026 | $ | 128,889.50 | ||
| April 30, 2026 | $ | 32,222.38 | ||
| May 30, 2026 | $ | 32,222.38 | ||
| June 30, 2026 | $ | 32,222.38 | ||
| July 30, 2026 | $ | 32,222.36 | ||
(a total payback to the Holder of $257,779.00).
The Company shall have a five (5) day grace period with respect to each payment. The Company has right to prepay in full at any time with no prepayment penalty. All payments shall be made by bank wire transfer to the Holder’s wire instructions, attached hereto as Exhibit A. For the avoidance of doubt, a missed payment shall be considered an Event of Default.
1.3 Prepayment Discount. Notwithstanding anything to the contrary contained in this Note, at any time during the period set forth on the table immediately following this paragraph (the “Prepayment Period”) or as otherwise agreed to between the Borrower and the Holder, the Borrower shall have the right, exercisable on not more than three (3) Trading Days prior written notice to the Holder of the Note to prepay the outstanding Note (principal and accrued interest), in full, in accordance with this Section 1.3. Any notice of prepayment hereunder (an “Optional Prepayment Notice”) shall be delivered to the Holder of the Note at its registered addresses and shall state: (1) that the Borrower is exercising its right to prepay the Note, and (2) the date of prepayment which shall be not more than three (3) Trading Days from the date of the Optional Prepayment Notice. On the date fixed for prepayment (the “Optional Prepayment Date”), the Borrower shall make payment of the Optional Prepayment Amount (as defined below) to Holder, or upon the direction of the Holder as specified by the Holder in a writing to the Borrower (which shall direction to be sent to Borrower by the Holder at least one (1) business day prior to the Optional Prepayment Date). If the Borrower exercises its right to prepay the Note, the Borrower shall make payment to the Holder of an amount in cash equal to the percentage (“Prepayment Percentage”) as set forth in the table immediately following this paragraph opposite the Prepayment Period, multiplied by the sum of the then outstanding principal amount of this Note plus any accrued and unpaid interest on the unpaid principal amount of this Note to the Optional Prepayment Date (the “Optional Prepayment Amount”).
| Prepayment Period | Prepayment Percentage |
| 1. The period beginning on the Issue Date and ending on the date which is ninety (90) days following the Issue Date. | 97% |
| 2. The period beginning on the date which is ninety-one (91) days following the Issue Date and ending on the date which is one hundred eighty (180) days following the Issue Date | 98% |
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ARTICLE II. CERTAIN COVENANTS
2.1 Sale of Assets. So long as the Borrower shall have any obligation under this Note, the Borrower shall not, without the Holder’s written consent, sell, lease or otherwise dispose of any significant portion of its assets outside the ordinary course of business. Any consent to the disposition of any assets may be conditioned on a specified use of the proceeds of disposition.
ARTICLE III. EVENTS OF DEFAULT
If any of the following events of default (each, an “Event of Default”) shall occur:
3.1 Failure to Pay Principal and Interest. The Borrower fails to pay the principal hereof or interest thereon when due on this Note, whether at maturity, upon acceleration or otherwise and such breach continues for a period of five (5) days after written notice from the Holder.
3.2 Conversion and the Shares. The Borrower fails to issue shares of Common Stock to the Holder (or announces or threatens in writing that it will not honor its obligation to do so) upon exercise by the Holder of the conversion rights of the Holder in accordance with the terms of this Note (following an Event of Default other than this Section 3.2), fails to transfer or cause its transfer agent to transfer (issue) (electronically or in certificated form) any certificate for shares of Common Stock issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note, the Borrower directs its transfer agent not to transfer or delays, impairs, and/or hinders its transfer agent in transferring (or issuing) (electronically or in certificated form) any certificate for shares of Common Stock to be issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note, or fails to remove (or directs its transfer agent not to remove or impairs, delays, and/or hinders its transfer agent from removing) any restrictive legend (or to withdraw any stop transfer instructions in respect thereof) on any certificate for any shares of Common Stock issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note (or makes any written announcement, statement or threat that it does not intend to honor the obligations described in this paragraph) and any such failure shall continue uncured (or any written announcement, statement or threat not to honor its obligations shall not be rescinded in writing) for three (3) business days after the Holder shall have delivered a Notice of Conversion. It is an obligation of the Borrower to remain current in its obligations to its transfer agent. It shall be an event of default of this Note, if a conversion of this Note is delayed, hindered or frustrated due to a balance owed by the Borrower to its transfer agent. If at the option of the Holder, the Holder advances any funds to the Borrower’s transfer agent in order to process a conversion, such advanced funds shall be paid by the Borrower to the Holder within forty-eight (48) hours of a demand from the Holder.
3.3 Breach of Covenants. The Borrower breaches any material covenant or other material term or condition contained in this Note and any collateral documents including but not limited to the Purchase Agreement and such breach continues for a period of twenty (20) days after written notice thereof to the Borrower from the Holder.
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3.4 Breach of Representations and Warranties. Any representation or warranty of the Borrower made herein or in any agreement, statement or certificate given in writing pursuant hereto or in connection herewith (including, without limitation, the Purchase Agreement), shall be false or misleading in any material respect when made and the breach of which has (or with the passage of time will have) a material adverse effect on the rights of the Holder with respect to this Note or the Purchase Agreement.
3.5 Receiver or Trustee. The Borrower or any subsidiary of the Borrower shall make an assignment for the benefit of creditors, or apply for or consent to the appointment of a receiver or trustee for it or for a substantial part of its property or business, or such a receiver or trustee shall otherwise be appointed.
3.6 Bankruptcy. Bankruptcy, insolvency, reorganization or liquidation proceedings or other proceedings, voluntary or involuntary, for relief under any bankruptcy law or any law for the relief of debtors shall be instituted by or against the Borrower or any subsidiary of the Borrower.
3.7 Delisting of Common Stock. The Borrower shall fail to maintain the listing of the Common Stock on the OTC Markets, Nasdaq National Market, the Nasdaq SmallCap Market, the New York Stock Exchange, or the NYSE American Stock Exchange.
3.8 Failure to Comply with the Exchange Act. If the Borrower is in breach of Section 3.1 hereof and the Borrower shall fail to comply with the reporting requirements of the Exchange Act and such failure occurs or is continuing at any time following the date which is 180 days from the date of this Note; and/or the Borrower shall cease to be subject to the reporting requirements of the Exchange Act.
3.9 Liquidation. Any dissolution, liquidation, or winding up of Borrower or any substantial portion of its business.
3.10 Cessation of Operations. Any cessation of operations by Borrower or Borrower admits it is otherwise generally unable to pay its debts as such debts become due, provided, however, that any disclosure of the Borrower’s ability to continue as a “going concern” shall not be an admission that the Borrower cannot pay its debts as they become due.
3.11 Financial Statement Restatement. The restatement of any financial statements filed by the Borrower with the SEC at any time after 180 days after the Issuance Date for any date or period until this Note is no longer outstanding, if the result of such restatement would, by comparison to the un-restated financial statement, have constituted a material adverse effect on the rights of the Holder with respect to this Note or the Purchase Agreement.
3.12 Replacement of Transfer Agent. In the event that the Borrower proposes to replace its transfer agent, the Borrower fails to provide, prior to the effective date of such replacement, a fully executed Irrevocable Transfer Agent Instructions in a form as initially delivered pursuant to the Purchase Agreement (including but not limited to the provision to irrevocably reserve shares of Common Stock in the Reserved Amount) signed by the successor transfer agent to Borrower and the Borrower.
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3.13 Cross-Default. Notwithstanding anything to the contrary contained in this Note or the other related or companion documents, a breach or default by the Borrower of any covenant or other term or condition contained in any of the Other Agreements, after the passage of all applicable notice and cure or grace periods, shall, at the option of the Holder, be considered a default under this Note and the Other Agreements, in which event the Holder shall be entitled (but in no event required) to apply all rights and remedies of the Holder under the terms of this Note and the Other Agreements by reason of a default under said Other Agreement or hereunder. “Other Agreements” means, collectively, all agreements and instruments between, among or by: (1) the Borrower, and, or for the benefit of, (2) the Holder and any affiliate of the Holder, including, without limitation, promissory notes; provided, however, the term “Other Agreements” shall not include the related or companion documents to this Note. Each of the loan transactions will be cross-defaulted with each other loan transaction and with all other existing and future debt of Borrower to the Holder. Furthermore, notwithstanding anything contained herein to the contrary or in any of the Other Agreements to the contrary, in the event of default of any Other Agreements and such Other Agreements are convertible into shares of Common Stock, Section 4.6 (d) Adjustment Due to Market Price hereof shall be applied to each such Other Agreement as if such section was included within such Other Agreement and the principal amount due with respect to such Other Agreement shall be adjusted accordingly.
Upon the occurrence and during the continuation of any Event of Default, the Note shall become immediately due and payable and the Borrower shall pay to the Holder, in full satisfaction of its obligations hereunder, an amount equal to 150% (“Default Percentage”) times the sum of (w) the then outstanding principal amount of this Note plus (x) accrued and unpaid interest on the unpaid principal amount of this Note to the date of payment plus (y) Default Interest, if any, on the amounts referred to in clauses (w) and/or (x) plus (z) any amounts owed to the Holder pursuant to Article IV hereof (the then outstanding principal amount of this Note to the date of payment plus the amounts referred to in clauses (x), (y) and (z) shall collectively be known as the “Default Amount”) and all other amounts payable hereunder shall immediately become due and payable, all without demand, presentment or notice, all of which hereby are expressly waived, together with all costs, including, without limitation, legal fees and expenses, of collection, and the Holder shall be entitled to exercise all other rights and remedies available at law or in equity. Notwithstanding anything to the contrary contained herein, in the event that following an Event of Default (other than Section 3.2), a default pursuant to Section 3.2 occurs, the Default Percentage shall be immediately adjusted to 200%.
If the Borrower fails to pay the Default Amount within five (5) business days of written notice that such amount is due and payable, then the Holder shall have the right at any time, to convert the balance owed pursuant to the note including the Default Amount into shares of common stock of the Company as set forth herein.
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ARTICLE IV. CONVERSION RIGHTS
4.1 Conversion Right. At any time following an Event of Default and not less than 180 days following the date of this Note, the Holder shall have the right, to convert all or any part of the outstanding and unpaid amount of this Note into fully paid and non-assessable shares of Common Stock, as such Common Stock exists on the Issue Date, or any shares of capital stock or other securities of the Borrower into which such Common Stock shall hereafter be changed or reclassified at the conversion price determined as provided herein (a “Conversion”); provided, however, that in no event shall the Holder be entitled to convert any portion of this Note in excess of that portion of this Note upon conversion of which the sum of (1) the number of shares of Common Stock beneficially owned by the Holder and its affiliates (other than shares of Common Stock which may be deemed beneficially owned through the ownership of the unconverted portion of the Notes or the unexercised or unconverted portion of any other security of the Borrower subject to a limitation on conversion or exercise analogous to the limitations contained herein) and (2) the number of shares of Common Stock issuable upon the conversion of the portion of this Note with respect to which the determination of this proviso is being made, would result in beneficial ownership by the Holder and its affiliates of more than 4.99% of the outstanding shares of Common Stock. For purposes of the proviso to the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Regulations 13D-G thereunder, except as otherwise provided in clause (1) of such proviso. The beneficial ownership limitations on conversion as set forth in the section may NOT be waived by the Holder. The number of shares of Common Stock to be issued upon each conversion of this Note shall be determined by dividing the Conversion Amount (as defined below) by the applicable Conversion Price then in effect on the date specified in the notice of conversion, in the form attached hereto as Exhibit B(the “Notice of Conversion”), delivered to the Borrower by the Holder in accordance with Section 4.4 below; provided that the Notice of Conversion is submitted by facsimile or e-mail (or by other means resulting in, or reasonably expected to result in, notice) to the Borrower before 6:00 p.m., New York, New York time on such conversion date (the “Conversion Date”); however, if the Notice of Conversion is sent after 6:00pm, New York, New York time the Conversion Date shall be the next business day. The term “Conversion Amount” means, with respect to any conversion of this Note, the sum of (1) the principal amount of this Note to be converted in such conversion plus (2) at the Holder’s option, accrued and unpaid interest, if any, on such principal amount at the interest rates provided in this Note to the Conversion Date, plus (3) at the Holder’s option, Default Interest, if any, on the amounts referred to in the immediately preceding clauses (1) and/or (2) plus (4) at the Holder’s option, any amounts owed to the Holder pursuant to Sections 4.4 hereof. Limitation shall no longer apply to limit the issuance of shares in conversion of this Note.
The Holder shall be entitled to deduct $1,500.00 from the conversion amount in each Notice of Conversion to cover Holder's deposit fees associated with each Notice of Conversion. Any additional expenses incurred by Holder with respect to the Borrower's transfer agent, for the issuance of the Common Stock into which this Note is convertible into, shall immediately and automatically be added to the balance of the Note at such time as the expenses are incurred by Holder.
4.1 Conversion Price. The conversion price (the “Conversion Price”) shall mean the greater of: (i) $0.05 (the “Fixed Conversion Price”); or (ii) 65% multiplied by the lowest Trading Price for the Common Stock during the ten (10) Trading Days prior to the Conversion Date (the “Variable Conversion Price”)(subject to equitable adjustments by the Borrower relating to the Borrower’s securities or the securities of any subsidiary of the Borrower, combinations, recapitalization, reclassifications, extraordinary distributions and similar events). “Trading Price” means, for any security as of any date, the closing bid price on the OTCQB, OTCQX, Pink Sheets electronic quotation system or applicable trading market (the “OTC”) as reported by a reliable reporting service (“Reporting Service”) designated by the Holder (i.e. Bloomberg) or, if the OTC is not the principal trading market for such security, the closing bid price of such security on the principal securities exchange or trading market where such security is listed or traded or, if no closing bid price of such security is available in any of the foregoing manners, the average of the closing bid prices of any market makers for such security that are listed in the “pink sheets”. If the Trading Price cannot be calculated for such security on such date in the manner provided above, the Trading Price shall be the fair market value as mutually determined by the Borrower and the holders of a majority in interest of the Notes being converted for which the calculation of the Trading Price is required in order to determine the Conversion Price of such Notes. “Trading Day” shall mean any day on which the Common Stock is tradable for any period on the OTC, or on the principal securities exchange or other securities market on which the Common Stock is then being traded.
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4.2 Authorized Shares. The Borrower covenants that during the period that the Note is outstanding, the Borrower will reserve from its authorized and unissued Common Stock a sufficient number of shares, free from preemptive rights, to provide for the issuance of Common Stock upon the full conversion of this Note issued pursuant to the Purchase Agreement. The Borrower is required at all times to have authorized and reserved four times the number of shares that is actually issuable upon full conversion of the Note (based on the Conversion Price of the Note in effect from time to time) (the “Reserved Amount”). The Reserved Amount shall be increased from time to time in accordance with the Borrower’s obligations hereunder. The Borrower represents that upon issuance, such shares will be duly and validly issued, fully paid and non-assessable. In addition, if the Borrower shall issue any securities or make any change to its capital structure which would change the number of shares of Common Stock into which the Notes shall be convertible at the then current Conversion Price, the Borrower shall at the same time make proper provision so that thereafter there shall be a sufficient number of shares of Common Stock authorized and reserved, free from preemptive rights, for conversion of the outstanding Note. The Borrower (i) acknowledges that it has irrevocably instructed its transfer agent to issue certificates for the Common Stock issuable upon conversion of this Note, and (ii) agrees that its issuance of this Note shall constitute full authority to its officers and agents who are charged with the duty of executing stock certificates to execute and issue the necessary certificates for shares of Common Stock in accordance with the terms and conditions of this Note.
If, at any time the Borrower does not maintain the Reserved Amount it will be considered an Event of Default under this Note.
4.3 Method of Conversion.
(a) Mechanics of Conversion. As set forth in Section 4.1 hereof, at any time following an Event of Default, the balance due pursuant to this Note may be converted by the Holder in whole or in part at any time from time to time after the Issue Date, by (A) submitting to the Borrower a Notice of Conversion (by facsimile, e-mail or other reasonable means of communication dispatched on the Conversion Date prior to 6:00 p.m., New York, New York time) and (B) subject to Section 4.4(b), surrendering this Note at the principal office of the Borrower (upon payment in full of any amounts owed hereunder).
(b) Surrender of Note Upon Conversion. Notwithstanding anything to the contrary set forth herein, upon conversion of this Note in accordance with the terms hereof, the Holder shall not be required to physically surrender this Note to the Borrower unless the entire unpaid principal amount of this Note is so converted. The Holder and the Borrower shall maintain records showing the principal amount so converted and the dates of such conversions or shall use such other method, reasonably satisfactory to the Holder and the Borrower, so as not to require physical surrender of this Note upon each such conversion.
(c) Delivery of Common Stock Upon Conversion. Upon receipt by the Borrower from the Holder of a facsimile transmission or e-mail (or other reasonable means of communication) of a Notice of Conversion meeting the requirements for conversion as provided in this Section 4.4, the Borrower shall issue and deliver or cause to be issued and delivered to or upon the order of the Holder certificates for the Common Stock issuable upon such conversion within three (3) business days after such receipt (the “Deadline”) (and, solely in the case of conversion of the entire unpaid principal amount hereof, surrender of this Note) in accordance with the terms hereof and the Purchase Agreement. Upon receipt by the Borrower of a Notice of Conversion, the Holder shall be deemed to be the holder of record of the Common Stock issuable upon such conversion, the outstanding principal amount and the amount of accrued and unpaid interest on this Note shall be reduced to reflect such conversion, and, unless the Borrower defaults on its obligations hereunder, all rights with respect to the portion of this Note being so converted shall forthwith terminate except the right to receive the Common Stock or other securities, cash or other assets, as herein provided, on such conversion. If the Holder shall have given a Notice of Conversion as provided herein, the Borrower’s obligation to issue and deliver the certificates for Common Stock shall be absolute and unconditional, irrespective of the absence of any action by the Holder to enforce the same, any waiver or consent with respect to any provision thereof, the recovery of any judgment against any person or any action to enforce the same, any failure or delay in the enforcement of any other obligation of the Borrower to the holder of record, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder of any obligation to the Borrower, and irrespective of any other circumstance which might otherwise limit such obligation of the Borrower to the Holder in connection with such conversion.
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(d) Delivery of Common Stock by Electronic Transfer. In lieu of delivering physical certificates representing the Common Stock issuable upon conversion, provided the Borrower is participating in the Depository Trust Company (“DTC”) Fast Automated Securities Transfer (“FAST”) program, upon request of the Holder and its compliance with the provisions set forth herein, the Borrower shall use its best efforts to cause its transfer agent to electronically transmit the Common Stock issuable upon conversion to the Holder by crediting the account of Holder’s Prime Broker with DTC through its Deposit and Withdrawal at Custodian (“DWAC”) system.
(e) Failure to Deliver Common Stock Prior to Deadline. Without in any way limiting the Holder’s right to pursue other remedies, including actual damages and/or equitable relief, the parties agree that if delivery of the Common Stock issuable upon conversion of this Note is not delivered by the Deadline due to action and/or inaction of the Borrower, the Borrower shall pay to the Holder $2,000 per day in cash, for each day beyond the Deadline that the Borrower fails to deliver such Common Stock (the “Fail to Deliver Fee”); provided; however that the Fail to Deliver Fee shall not be due if the failure is a result of a third party (i.e., transfer agent; and not the result of any failure to pay such transfer agent) despite the best efforts of the Borrower to effect delivery of such Common Stock. Such cash amount shall be paid to Holder by the fifth day of the month following the month in which it has accrued or, at the option of the Holder (by written notice to the Borrower by the first day of the month following the month in which it has accrued), shall be added to the principal amount of this Note, in which event interest shall accrue thereon in accordance with the terms of this Note and such additional principal amount shall be convertible into Common Stock in accordance with the terms of this Note. The Borrower agrees that the right to convert is a valuable right to the Holder. The damages resulting from a failure, attempt to frustrate, interference with such conversion right are difficult if not impossible to qualify. Accordingly, the parties acknowledge that the liquidated damages provision contained in this Section 4.4(e) are justified.
4.4 Concerning the Shares. The shares of Common Stock issuable upon conversion of this Note may not be sold or transferred unless: (i) such shares are sold pursuant to an effective registration statement under the Act or (ii) the Borrower or its transfer agent shall have been furnished with an opinion of counsel (which opinion shall be in form, substance and scope customary for opinions of counsel in comparable transactions) to the effect that the shares to be sold or transferred may be sold or transferred pursuant to an exemption from such registration (such as Rule 144 or a successor rule) (“Rule 144”); or (iii) such shares are transferred to an “affiliate” (as defined in Rule 144) of the Borrower who agrees to sell or otherwise transfer the shares only in accordance with this Section 4.5 and who is an Accredited Investor (as defined in the Purchase Agreement).
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Any restrictive legend on certificates representing shares of Common Stock issuable upon conversion of this Note shall be removed and the Borrower shall issue to the Holder a new certificate therefore free of any transfer legend if the Borrower or its transfer agent shall have received an opinion of counsel from Holder’s counsel, in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect that (i) a public sale or transfer of such Common Stock may be made without registration under the Act, which opinion shall be accepted by the Company so that the sale or transfer is effected; or (ii) in the case of the Common Stock issuable upon conversion of this Note, such security is registered for sale by the Holder under an effective registration statement filed under the Act; or otherwise may be sold pursuant to an exemption from registration. In the event that the Company does not reasonably accept the opinion of counsel provided by the Holder with respect to the transfer of Securities pursuant to an exemption from registration (such as Rule 144), it will be considered an Event of Default pursuant to this Note.
4.5 Effect of Certain Events.
(a) Effect of Merger, Consolidation, Etc. At the option of the Holder, the sale, conveyance or disposition of all or substantially all of the assets of the Borrower, the effectuation by the Borrower of a transaction or series of related transactions in which more than 50% of the voting power of the Borrower is disposed of, or the consolidation, merger or other business combination of the Borrower with or into any other Person (as defined below) or Persons when the Borrower is not the survivor shall be deemed to be an Event of Default (as defined in Article III) pursuant to which the Borrower shall be required to pay to the Holder upon the consummation of and as a condition to such transaction an amount equal to the Default Amount (as defined in Article III). “Person” shall mean any individual, corporation, limited liability company, partnership, association, trust or other entity or organization.
(b) Adjustment Due to Merger, Consolidation, Etc. If, at any time when this Note is issued and outstanding and prior to conversion of all of the Note, there shall be any merger, consolidation, exchange of shares, recapitalization, reorganization, or other similar event, as a result of which shares of Common Stock of the Borrower shall be changed into the same or a different number of shares of another class or classes of stock or securities of the Borrower or another entity, or in case of any sale or conveyance of all or substantially all of the assets of the Borrower other than in connection with a plan of complete liquidation of the Borrower, then the Holder of this Note shall thereafter have the right to receive upon conversion of this Note, upon the basis and upon the terms and conditions specified herein and in lieu of the shares of Common Stock immediately theretofore issuable upon conversion, such stock, securities or assets which the Holder would have been entitled to receive in such transaction had this Note been converted in full immediately prior to such transaction (without regard to any limitations on conversion set forth herein), and in any such case appropriate provisions shall be made with respect to the rights and interests of the Holder of this Note to the end that the provisions hereof (including, without limitation, provisions for adjustment of the Conversion Price and of the number of shares issuable upon conversion of the Note) shall thereafter be applicable, as nearly as may be practicable in relation to any securities or assets thereafter deliverable upon the conversion hereof. The Borrower shall not affect any transaction described in this Section 4.6(b) unless (a) it first gives, to the extent practicable, ten (10) days prior written notice (but in any event at least five (5) days prior written notice) of the record date of the special meeting of shareholders to approve, or if there is no such record date, the consummation of, such merger, consolidation, exchange of shares, recapitalization, reorganization or other similar event or sale of assets (during which time the Holder shall be entitled to convert this Note) and (b) the resulting successor or acquiring entity (if not the Borrower) assumes by written instrument the obligations of this Note. The above provisions shall similarly apply to successive consolidations, mergers, sales, transfers or share exchanges.
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(c) Adjustment Due to Distribution. If the Borrower shall declare or make any distribution of its assets (or rights to acquire its assets) to holders of Common Stock as a dividend, stock repurchase, by way of return of capital or otherwise (including any dividend or distribution to the Borrower’s shareholders in cash or shares (or rights to acquire shares) of capital stock of a subsidiary (i.e., a spin-off)) (a “Distribution”), then the Holder of this Note shall be entitled, upon any conversion of this Note after the date of record for determining shareholders entitled to such Distribution, to receive the amount of such assets which would have been payable to the Holder with respect to the shares of Common Stock issuable upon such conversion had such Holder been the holder of such shares of Common Stock on the record date for the determination of shareholders entitled to such Distribution.
(d) Adjustment Due to Market Price. If at any time the Market Price, as determined on the date of each conversion, is less than the Conversion Price, then the Default Amount due pursuant to this Note shall be increased immediately following each such conversion by the result of the Conversion Price minus the Market Price multiplied by the amount of shares of common stock being issued with respect to such conversion. “Market Price” shall mean the lowest closing bid price for the Common Stock during ten (10) Trading Days prior to the applicable date of conversion. “Trading Day” shall mean any day on which the Common Stock is tradable for any period on the trading market, or on the principal securities exchange or other securities market on which the Common Stock is then being traded. For example, the Conversion Price is $0.05 and if the Market Price is $0.01 and the amount of shares issued upon conversion is 10,000 shares, then the Default Amount shall be increased by $400.00 ($0.01 - $0.05 = $0.04 multiplied by 10,000 = 400.00) immediately following such conversion.
ARTICLE V. MISCELLANEOUS
5.1 Failure or Indulgence Not Waiver. No failure or delay on the part of the 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 privileges. All rights and remedies existing hereunder are cumulative to, and not exclusive of, any rights or remedies otherwise available.
5.2 Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by hand delivery, telegram, or electronic mail, addressed as set forth below or to such other address as such party shall have specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery or delivery by electronic mail, at the address or number designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall be:
If to the Borrower, to:
ConnectM Technology Solutions, Inc.
2 Mount Royal Avenue, Suite 550
Marlborough, Massachusetts 01752
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Attn: Bhaskar Panigrahi, Chief Executive Officer
Email: [email protected]
If to the Holder:
Vanquish Funding Group Inc.
1800 Diagonal Road, Suite 623
Alexandria VA 22314
Attn: Curt Kramer
e-mail: [email protected]
5.3 Amendments. This Note and any provision hereof may only be amended by an instrument in writing signed by the Borrower and the Holder. The term “Note” and all reference thereto, as used throughout this instrument, shall mean this instrument (and the other Notes issued pursuant to the Purchase Agreement) as originally executed, or if later amended or supplemented, then as so amended or supplemented.
5.4 Assignability. This Note shall be binding upon the Borrower and its successors and assigns, and shall inure to be the benefit of the Holder and its successors and assigns. Each transferee of this Note must be an “accredited investor” (as defined in Rule 501(a) of the Securities and Exchange Commission). Notwithstanding anything in this Note to the contrary, this Note may be pledged as collateral in connection with a bona fide margin account or other lending arrangement; and may be assigned by the Holder without the consent of the Borrower.
5.5 Cost of Collection. If default is made in the payment of this Note, the Borrower shall pay the Holder hereof costs of collection, including reasonable attorneys’ fees.
5.6 Governing Law. This Note shall be governed by and construed in accordance with the laws of the Commonwealth of Virginia without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Note shall be brought only in the Circuit Court of Fairfax County, Virginia or in the Alexandria Division of the United States District Court for the Eastern District of Virginia. The parties to this Note hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. The Borrower and Holder waive trial by jury. The Holder shall be entitled to recover from the Borrower its reasonable attorney's fees and costs. In the event that any provision of this Note or any other agreement delivered in connection herewith is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of any agreement. Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this Note, any agreement or any other document delivered in connection with this Note by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Note and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
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5.7 Purchase Agreement. By its acceptance of this Note, each party agrees to be bound by the applicable terms of the Purchase Agreement.
5.8 Remedies. The Borrower acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder, by vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the Borrower acknowledges that the remedy at law for a breach of its obligations under this Note will be inadequate and agrees, in the event of a breach or threatened breach by the Borrower of the provisions of this Note, that the Holder shall be entitled, in addition to all other available remedies at law or in equity, and in addition to the penalties assessable herein, to an injunction or injunctions restraining, preventing or curing any breach of this Note and to enforce specifically the terms and provisions thereof, without the necessity of showing economic loss and without any bond or other security being required.
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IN WITNESS WHEREOF, Borrower has caused this Note to be signed in its name by its duly authorized officer this on October 1, 2025
| ConnectM Technology Solutions, Inc. | ||
| By: | /s/ Bhaskar Panigrahi | |
| Bhaskar Panigrahi | ||
| Chief Executive Officer | ||
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EXHIBIT A – WIRE INSTRUCTIONS
[to be provided via email]
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EXHIBIT B -- NOTICE OF CONVERSION
The undersigned hereby elects to convert $__________________ principal amount of the Note (defined below) into that number of shares of Common Stock to be issued pursuant to the conversion of the Note (“Common Stock”) as set forth below, of ConnectM Technology Solutions, Inc., a Delaware corporation (the “Borrower”) according to the conditions of the convertible note of the Borrower dated as of October 1, 2025 (the “Note”), as of the date written below. No fee will be charged to the Holder for any conversion, except for transfer taxes, if any.
Box Checked as to applicable instructions:
| [ ] | The Borrower shall electronically transmit the Common Stock issuable pursuant to this Notice of Conversion to the account of the undersigned or its nominee with DTC through its Deposit Withdrawal Agent Commission system (“DWAC Transfer”). |
Name of DTC Prime Broker:
Account Number:
| [ ] | The undersigned hereby requests that the Borrower issue a certificate or certificates for the number of shares of Common Stock set forth below (which numbers are based on the Holder’s calculation attached hereto) in the name(s) specified immediately below or, if additional space is necessary, on an attachment hereto: |
| Date of conversion: | ||||
| Applicable Conversion Price: | $ | |||
| Number of shares of common stock to be issued pursuant to conversion of the Notes: | ||||
| Amount of Principal Balance due remaining under the Note after this conversion: |
| By: | |||
| Name: | |||
| Title: | |||
| Date: |
15
SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT (the “Agreement”), dated as of October 1, 2025, by and between ConnectM Technology Solutions, Inc., a Delaware corporation, with its address at 2 Mount Royal Avenue, Suite 550, Marlborough, Massachusetts 01752 (the “Company”), and Vanquish Funding Group Inc., a Virginia corporation, with its address at 1800 Diagonal Road, Suite 623, Alexandria VA 22314 (the “Buyer”).
WHEREAS:
A. The Company and the Buyer are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by the rules and regulations as promulgated by the United States Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the “1933 Act”); and
B. Buyer desires to purchase and the Company desires to issue and sell, upon the terms and conditions set forth in this Agreement, a bridge note of the Company, in the form attached hereto as Exhibit A, in the aggregate principal amount of $230,160.00 (including $24,660.00 of Original Issue Discount) (the “Note”) with additional tranches of financing of up to $1,700,000.00, in the aggregate, during the next twelve (12) months subject to further agreement by and between the Company and the Buyer.
NOW THEREFORE, the Company and the Buyer severally (and not jointly) hereby agree as follows:
1. Purchase and Sale of the Securities.
a. Purchase of the Securities. On the Closing Date (as defined below), the Company shall issue and sell to the Buyer and the Buyer agrees to purchase from the Company the Securities as is set forth immediately below the Buyer’s name on the signature pages hereto.
b. Form of Payment. On the Closing Date (as defined below), (i) the Buyer shall pay the purchase price for the Securities be issued and sold to it at the Closing (as defined below) (the “Purchase Price”) by wire transfer of immediately available funds to the Company, in accordance with the Company’s written wiring instructions, against delivery of the Securities, and (ii) the Company shall deliver such duly executed Note on behalf of the Company against delivery of such Purchase Price.
c. Closing Date. Subject to the satisfaction (or written waiver) of the conditions thereto set forth in Section 6 and Section 7 below, the date and time of the issuance and sale of the Securities pursuant to this Agreement (the “Closing Date”) shall be 12:00 noon, Eastern Standard Time on or about October 1, 2025, or such other mutually agreed upon time. The closing of the transactions contemplated by this Agreement (the “Closing”) shall occur on the Closing Date at such location as may be agreed to by the parties.
2. Buyer’s Representations and Warranties. The Buyer represents and warrants to the Company that:
a. Investment Purpose. As of the date hereof, the Buyer is purchasing the Note and the shares of Common Stock issuable upon conversion of or otherwise pursuant to the Note (such shares of Common Stock being collectively referred to herein as the “Conversion Shares” and, collectively with the Note, the “Securities”) for its own account and not with a present view towards the public sale or distribution thereof, except pursuant to sales registered or exempted from registration under the 1933 Act.
b. Accredited Investor Status. The Buyer is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D (an “Accredited Investor”).
c. Reliance on Exemptions. The Buyer understands that the Securities are being offered and sold to it in reliance upon specific exemptions from the registration requirements of United States federal and state securities laws and that the Company is relying upon the truth and accuracy of, and the Buyer’s compliance with, the representations, warranties, agreements, acknowledgments and understandings of the Buyer set forth herein in order to determine the availability of such exemptions and the eligibility of the Buyer to acquire the Securities.
d. Information. The Company has not disclosed to the Buyer any material nonpublic information and will not disclose such information unless such information is disclosed to the public prior to or promptly following such disclosure to the Buyer.
e. Legends. The Buyer understands that the Securities have not been registered under the 1933 Act; and may bear a restrictive legend in substantially the following form:
"THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER ANY STATE SECURITIES LAWS, AND MAY NOT BE PLEDGED, SOLD, ASSIGNED, HYPOTHECATED OR OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR (2) THE ISSUER OF SUCH SECURITIES RECEIVES AN OPINION OF COUNSEL TO THE BUYER OF SUCH SECURITIES, WHICH COUNSEL AND OPINION ARE REASONABLY ACCEPTABLE TO THE ISSUER’S TRANSFER AGENT, THAT SUCH SECURITIES MAY BE PLEDGED, SOLD, ASSIGNED, HYPOTHECATED OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS."
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The legend set forth above shall be removed and the Company shall issue a certificate without such legend to the Buyer of any Security upon which it is stamped, if, unless otherwise required by applicable state securities laws, (a) such Security is registered for sale under an effective registration statement filed under the 1933 Act or otherwise may be sold pursuant to an exemption from registration without any restriction as to the number of securities as of a particular date that can then be immediately sold, or (b) such Buyer provides the Company with an opinion of counsel, in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect that a public sale or transfer of such Security may be made without registration under the 1933 Act, which opinion shall be accepted by the Company so that the sale or transfer is effected. The Buyer agrees to sell all Securities, including those represented by a certificate(s) from which the legend has been removed, in compliance with applicable prospectus delivery requirements, if any. In the event that the Company does not reasonably accept the opinion of counsel that properly conforms to applicable securities laws provided by the Buyer with respect to the transfer of any Securities pursuant to an exemption from registration, such as Rule 144, at the Deadline, it will be considered an Event of Default pursuant to Section 3.2 of the Note.
f. Authorization; Enforcement. This Agreement has been duly and validly authorized. This Agreement has been duly executed and delivered on behalf of the Buyer, and this Agreement constitutes a valid and binding agreement of the Buyer enforceable in accordance with its terms.
3. Representations and Warranties of the Company. The Company represents and warrants to the Buyer that:
a. Organization and Qualification. The Company and each of its Subsidiaries (as defined below), if any, is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is incorporated, with full power and authority (corporate and other) to own, lease, use and operate its properties and to carry on its business as and where now owned, leased, used, operated and conducted. “Subsidiaries” means any corporation or other organization, whether incorporated or unincorporated, in which the Company owns, directly or indirectly, any equity or other ownership interest.
b. Authorization; Enforcement. (i) The Company has all requisite corporate power and authority to enter into and perform this Agreement, the Note and to consummate the transactions contemplated hereby and thereby and to issue the Securities, in accordance with the terms hereof and thereof, (ii) the execution and delivery of this Agreement, the Note by the Company and the consummation by it of the transactions contemplated hereby and thereby (including without limitation, the issuance of the Note has been duly authorized by the Company’s Board of Directors and no further consent or authorization of the Company, its Board of Directors, or its shareholders is required, (iii) this Agreement has been duly executed and delivered by the Company by its authorized representative, and such authorized representative is the true and official representative with authority to sign this Agreement and the other documents executed in connection herewith and bind the Company accordingly, and (iv) this Agreement constitutes, and upon execution and delivery by the Company of the Note, each of such instruments will constitute, a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms.
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c. Capitalization. As of the date hereof, the authorized common stock of the Company consists of 100,000,000 authorized shares of Common Stock, $0.0001 par value per share, of which 71,631,073 shares are issued and outstanding. All of such outstanding shares of capital stock are, or upon issuance will be, duly authorized, validly issued, fully paid and non-assessable.
d. Issuance of Shares. The Securities are duly authorized and reserved for issuance in accordance with its respective terms, will be validly issued, fully paid and non-assessable, and free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the Company and will not impose personal liability upon the Buyer thereof.
e. No Conflicts. The execution, delivery and performance of this Agreement, the Note by the Company and the consummation by the Company of the transactions contemplated hereby and thereby will not (i) conflict with or result in a violation of any provision of the Certificate of Incorporation or By-laws, or (ii) violate or conflict with, or result in a breach of any provision of, or constitute a default (or an event which with notice or lapse of time or both could become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture, patent, patent license or instrument to which the Company or any of its Subsidiaries is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities laws and regulations and regulations of any self-regulatory organizations to which the Company or its securities are subject) applicable to the Company or any of its Subsidiaries or by which any property or asset of the Company or any of its Subsidiaries is bound or affected (except for such conflicts, defaults, terminations, amendments, accelerations, cancellations and violations as would not, individually or in the aggregate, have a Material Adverse Effect). The businesses of the Company and its Subsidiaries, if any, are not being conducted, and shall not be conducted so long as the Buyer owns any of the Securities, in violation of any law, ordinance or regulation of any governmental entity. “Material Adverse Effect” means any material adverse effect on the business, operations, assets, financial condition or prospects of the Company or its Subsidiaries, if any, taken as a whole, or on the transactions contemplated hereby or by the agreements or instruments to be entered into in connection herewith.
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f. SEC Documents; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required to be filed by it with the SEC pursuant to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “1934 Act”) (all of the foregoing filed prior to the date hereof and all exhibits included therein and financial statements and schedules thereto and documents (other than exhibits to such documents) incorporated by reference therein, being hereinafter referred to herein as the “SEC Documents”). Upon written request the Company will deliver to the Buyer true and complete copies of the SEC Documents, except for such exhibits and incorporated documents. As of their respective dates or if amended, as of the dates of the amendments, the SEC Documents complied in all material respects with the requirements of the 1934 Act and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents, and none of the SEC Documents, at the time they were filed with the SEC, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. None of the statements made in any such SEC Documents is, or has been, required to be amended or updated under applicable law (except for such statements as have been amended or updated in subsequent filings prior the date hereof). As of their respective dates or if amended, as of the dates of the amendments, the financial statements of the Company included in the SEC Documents complied as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto. Such financial statements have been prepared in accordance with United States generally accepted accounting principles, consistently applied, during the periods involved and fairly present in all material respects the consolidated financial position of the Company and its consolidated Subsidiaries as of the dates thereof and the consolidated results of their operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments). The Company is subject to the reporting requirements of the 1934 Act.
g. Absence of Certain Changes. Since June 30, 2025, except as set forth in the SEC Documents, there has been no material adverse change and no material adverse development in the assets, liabilities, business, properties, operations, financial condition, results of operations, prospects or 1934 Act reporting status of the Company or any of its Subsidiaries.
h. Absence of Litigation. Except as set forth in the SEC Documents, there is no action, suit, claim, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the Company or any of its Subsidiaries, threatened against or affecting the Company or any of its Subsidiaries, or their officers or directors in their capacity as such, that could have a Material Adverse Effect. The Company and its Subsidiaries are unaware of any facts or circumstances which might give rise to any of the foregoing.
i. No Integrated Offering. Neither the Company, nor any of its affiliates, nor any person acting on its or their behalf, has directly or indirectly made any offers or sales in any security or solicited any offers to buy any security under circumstances that would require registration under the 1933 Act of the issuance of the Securities to the Buyer. The issuance of the Securities to the Buyer will not be integrated with any other issuance of the Company’s securities (past, current or future) for purposes of any shareholder approval provisions applicable to the Company or its securities.
j. No Brokers. Except for Digital Offering LLC, the Company has taken no action which would give rise to any claim by any person for brokerage commissions, transaction fees or similar payments relating to this Agreement or the transactions contemplated hereby.
k. No Investment Company. The Company is not, and upon the issuance and sale of the Securities as contemplated by this Agreement will not be an “investment company” required to be registered under the Investment Company Act of 1940 (an “Investment Company”). The Company is not controlled by an Investment Company.
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l. Breach of Representations and Warranties by the Company. If the Company breaches any of the material representations or warranties set forth in this Section 3 which is continuing after the applicable cure period as set forth in the Note, if any, and in addition to any other remedies available to the Buyer pursuant to this Agreement, it will be considered an Event of default under Section 4.4 of the Note.
4. COVENANTS.
a. Best Efforts. The Company shall use its reasonable commercial efforts to satisfy timely each of the conditions described in Section 7 of this Agreement.
b. Use of Proceeds. The Company shall use the proceeds for general working capital purposes.
c. Expenses. At the Closing, the Company’s obligation with respect to the transactions contemplated by this Agreement is to reimburse Buyer’ expenses shall be $5,500.00 for Buyer’s legal fees and due diligence fee.
d. Corporate Existence. So long as the Buyer beneficially owns any Note, the Company shall maintain its corporate existence and shall not sell all or substantially all of the Company’s assets, except with the prior written consent of the Buyer.
e. Breach of Covenants. If the Company breaches any of the material covenants set forth in this Section 4, and in addition to any other remedies available to the Buyer pursuant to this Agreement which is continuing after the applicable cure period as set forth in the Note, it will be considered an event of default under Section 4.4 of the Note.
f. Failure to Comply with the 1934 Act. So long as the Buyer beneficially owns the Note, the Company shall comply with the reporting requirements of the 1934 Act; and the Company shall continue to be subject to the reporting requirements of the 1934 Act.
g. The Buyer is Not a “Dealer”. The Buyer and the Company hereby acknowledge and agree that the Buyer has not: (i) acted as an underwriter; (ii) acted as a market maker or specialist; (iii) acted as “de facto” market maker; or (iv) conducted any other professional market activities such as providing investment advice, extending credit and lending securities in connection; and thus that the Buyer is not a “Dealer” as such term is defined in the 1934 Act.
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5. Transfer Agent Instructions. The Company shall issue irrevocable instructions to its transfer agent to issue certificates, registered in the name of the Buyer or its nominee, for the shares underlying any conversion of the Note upon default of the Note (the “Conversion Shares”) in such amounts as specified from time to time by the Buyer to the Company upon conversion of the Note in accordance with the terms thereof (the “Irrevocable Transfer Agent Instructions”). In the event that the Company proposes to replace its transfer agent, the Company shall provide, prior to the effective date of such replacement, a fully executed Irrevocable Transfer Agent Instructions in a form as initially delivered pursuant to this Agreement (including but not limited to the provision to irrevocably reserve shares of Common Stock in the Reserved Amount as such term is defined in the Note) signed by the successor transfer agent to Company and the Company. Prior to registration of the Conversion Shares under the 1933 Act or the date on which the Conversion Shares may be sold pursuant to an exemption from registration, all such certificates shall bear the restrictive legend specified in Section 2(e) of this Agreement. The Company warrants that: (i) no instruction other than the Irrevocable Transfer Agent Instructions referred to in this Section 5, will be given by the Company to its transfer agent and that the Securities shall otherwise be freely transferable on the books and records of the Company as and to the extent provided in this Agreement and the Note; (ii) it will not direct its transfer agent not to transfer or delay, impair, and/or hinder its transfer agent in transferring (or issuing)(electronically or in certificated form) any certificate for Conversion Shares to be issued to the Buyer upon conversion of or otherwise pursuant to the Note as and when required by the Note and this Agreement; and (iii) it will not fail to remove (or directs its transfer agent not to remove or impairs, delays, and/or hinders its transfer agent from removing) any restrictive legend (or to withdraw any stop transfer instructions in respect thereof) on any certificate for any Conversion Shares issued to the Buyer upon conversion of or otherwise pursuant to the Note as and when required by the Note and/or this Agreement. If the Buyer provides the Company and the Company’s transfer, at the cost of the Buyer, with an opinion of counsel in form, substance and scope customary for opinions in comparable transactions, to the effect that a public sale or transfer of such Securities may be made without registration under the 1933 Act, the Company shall permit the transfer, and, in the case of the Conversion Shares, promptly instruct its transfer agent to issue one or more certificates, free from restrictive legend, in such name and in such denominations as specified by the Buyer. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Buyer, by vitiating the intent and purpose of the transactions contemplated hereby. Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations under this Section 5 may be inadequate and agrees, in the event of a breach or threatened breach by the Company of the provisions of this Section, that the Buyer shall be entitled, in addition to all other available remedies, to an injunction restraining any breach and requiring immediate transfer, without the necessity of showing economic loss and without any bond or other security being required.
6. Conditions to the Company’s Obligation to Sell. The obligation of the Company hereunder to issue and sell the Securities to the Buyer at the Closing is subject to the satisfaction, at or before the Closing Date of each of the following conditions thereto, provided that these conditions are for the Company’s sole benefit and may be waived by the Company at any time in its sole discretion:
a. The Buyer shall have executed this Agreement and delivered the same to the Company.
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b. The Buyer shall have delivered the Purchase Price in accordance with Section 1(b) above.
c. The representations and warranties of the Buyer shall be true and correct in all material respects as of the date when made and as of the Closing Date as though made at that time (except for representations and warranties that speak as of a specific date), and the Buyer shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Buyer at or prior to the Closing Date.
d. No litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.
7. Conditions to The Buyer’s Obligation to Purchase. The obligation of the Buyer hereunder to purchase the Securities at the Closing is subject to the satisfaction, at or before the Closing Date of each of the following conditions, provided that these conditions are for the Buyer’s sole benefit and may be waived by the Buyer at any time in its sole discretion:
a. The Company shall have executed this Agreement and delivered the same to the Buyer.
b. The Company shall have delivered to the Buyer the duly executed Note, in accordance with Section 1(b) above.
c. The Irrevocable Transfer Agent Instructions, in form and substance satisfactory to the Buyer, shall have been delivered to and acknowledged in writing by the Company’s Transfer Agent.
d. The representations and warranties of the Company shall be true and correct in all material respects as of the date when made and as of the Closing Date as though made at such time (except for representations and warranties that speak as of a specific date) and the Company shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company at or prior to the Closing Date. The Buyer shall have received a certificate or certificates, executed by the chief executive officer of the Company, dated as of the Closing Date, to the foregoing effect and as to such other matters as may be reasonably requested by the Buyer including, but not limited to certificates with respect to the Board of Directors’ resolutions relating to the transactions contemplated hereby.
e. No litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.
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f. No event shall have occurred which could reasonably be expected to have a Material Adverse Effect on the Company including but not limited to a change in the 1934 Act reporting status of the Company or the failure of the Company to be timely in its 1934 Act reporting obligations.
8. Governing Law; Miscellaneous.
a. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Virginia without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Agreement shall be brought only in the Circuit Court of Fairfax County, Virginia or in the Alexandria Division of the United States District Court for the Eastern District of Virginia The parties to this Agreement hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. The Company and Buyer waive trial by jury. The Buyer shall be entitled to recover from the Company its reasonable attorney's fees and costs. In the event that any provision of this Agreement or any other agreement delivered in connection herewith is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of any agreement. Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this Agreement, the Note or any related document or agreement by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
b. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which shall constitute one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party.
c. Headings. The headings of this Agreement are for convenience of reference only and shall not form part of, or affect the interpretation of, this Agreement.
d. Severability. In the event that any provision of this Agreement is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any provision hereof which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision hereof.
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e. Entire Agreement; Amendments. This Agreement and the instruments referenced herein contain the entire understanding of the parties with respect to the matters covered herein and therein and, except as specifically set forth herein or therein, neither the Company nor the Buyer makes any representation, warranty, covenant or undertaking with respect to such matters. No provision of this Agreement may be waived or amended other than by an instrument in writing signed by the majority in interest of the Buyer.
f. Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by hand delivery, telegram, or facsimile, addressed as set forth below or to such other address as such party shall have specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery or delivery by facsimile, with accurate confirmation generated by the transmitting facsimile machine, at the address or number designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall be as set forth in the heading of this Agreement with a copy by fax only to (which copy shall not constitute notice) to Naidich Wurman LLP, 111 Great Neck Road, Suite 214, Great Neck, NY 11021, Attn: Allison Naidich, facsimile: 516-466-3555, e-mail: [email protected]. Each party shall provide notice to the other party of any change in address.
g. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns. Neither the Company nor the Buyer shall assign this Agreement or any rights or obligations hereunder without the prior written consent of the other. Notwithstanding the foregoing, the Buyer may assign its rights hereunder to any person that purchases Securities in a private transaction from the Buyer or to any of its “affiliates,” as that term is defined under the 1934 Act, without the consent of the Company.
h. Survival. The representations and warranties of the Company and the agreements and covenants set forth in this Agreement shall survive the closing hereunder notwithstanding any due diligence investigation conducted by or on behalf of the Buyer. The Company agrees to indemnify and hold harmless the Buyer and all their officers, directors, employees and agents for loss or damage arising as a result of or related to any breach or alleged breach by the Company of any of its representations, warranties and covenants set forth in this Agreement or any of its covenants and obligations under this Agreement, including advancement of expenses as they are incurred.
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i. Further Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as the other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.
j. No Strict Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction will be applied against any party.
k. Remedies. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Buyer by vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations under this Agreement will be inadequate and agrees, in the event of a breach or threatened breach by the Company of the provisions of this Agreement, that the Buyer shall be entitled, in addition to all other available remedies at law or in equity, and in addition to the penalties assessable herein, to an injunction or injunctions restraining, preventing or curing any breach of this Agreement and to enforce specifically the terms and provisions hereof, without the necessity of showing economic loss and without any bond or other security being required.
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IN WITNESS WHEREOF, the undersigned Buyer and the Company have caused this Agreement to be duly executed as of the date first above written.
| ConnectM Technology Solutions, Inc. | ||
| By: | /s/ Bhaskar Panigrahi | |
| Bhaskar Panigrahi | ||
| Chief Executive Officer | ||
| Vanquish Funding Group Inc. | ||
| By: | ||
| Curt Kramer | ||
| President | ||
| Aggregate Principal Amount of Note: | $ | 230,160.00 | ||
| Original Issue Discount | $ | 24,660.00 | ||
| Aggregate Purchase Price: | $ | 205,500.00 |
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CORPORATE RESOLUTION OF THE BOARD OF DIRECTORS
OF
CONNECTM TECHNOLOGY SOLUTIONS, INC.
I, the undersigned, do hereby certify that at a meeting of the Board of Directors of ConnectM Technology Solutions, Inc., a corporation organized under the laws of the State of Delaware (the “Corporation”), duly held on October 1, 2025 at , the following resolution, upon motions made, seconded and carried, was duly adopted and is now in full force and effect:
WHEREAS, the Board of Directors of the Corporation deem it in the best interests of the Corporation to enter into the Securities Purchase Agreement dated October 1, 2025 (the “Agreement”) with Vanquish Funding Group Inc., in connection with the issuance of a note of the Corporation, in the aggregate principal amount of $230,160.00 (the “Note”), convertible into shares of common stock solely in the event of default, $0.0001 par value per share, of the Company (the “Common Stock”), upon the terms and subject to the limitations and conditions set forth in such Note, along with an irrevocable letter agreement with Continental Stock Transfer & Trust Co., the Corporation’s transfer agent, with respect to the reserve of shares of common stock of the Corporation to be issued upon any conversion of the Note; the issuance of such shares of common stock in connection with a conversion of the Note; and the indemnification of Continental Stock Transfer & Trust Co. for all loss, liability, or expense in carrying out the authority and direction contained in the irrevocable letter agreement (the “Letter Agreement”);
NOW, THEREFORE, BE IT:
RESOLVED, that the Corporation is hereby authorized to enter into the Agreement, the Note and the Letter Agreement which provides in pertinent part: (i) reserve shares of common stock of the Corporation to be issued upon any conversion of the Note; (ii) issue such shares of common stock in connection with a conversion of the Note (issuance upon receipt of a notice of conversion of the holder of the Note) without any further action or confirmation by the Corporation; and the Corporation indemnifies Continental Stock Transfer & Trust Co. for all loss, liability, or expense in carrying out the authority and direction contained in the Letter Agreement:
RESOLVED, that any executive officer of the Corporation be, and hereby is, authorized, empowered and directed, from time to time, to take such additional action and to execute, certify and deliver to the transfer agent of the Corporation, as any appropriate or proper to implement the provisions of the foregoing resolutions:
I, the undersigned, do hereby certify that I am a member of the Board of Directors of the Corporation; that the attached is a true and correct copy of resolutions duly adopted and ratified at a meeting of the Board of Directors of the Corporation duly convened and held in accordance with its bylaws and the laws of the State of Delaware, as transcribed by me from the minutes; and that the same have not in any way been modified, repealed or rescinded and are in full force and effect.
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IN WITNESS WHEREOF, I have hereunto set my hands as a member of the Board of Directors of the Corporation.
| Dated: October 1, 2025 | /s/ Bhaskar Panigrahi |
| Bhaskar Panigrahi | |
| Member of the Board |
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OFFICER'S CERTIFICATE
The undersigned, Bhaskar Panigrahi, Chief Executive Officer of ConnectM Technology Solutions, Inc., a Delaware Corporation (the "Company"), in connection with the authorization and issuance of the Promissory Note of the Company in the amount of $230,160.00 in accordance with the Securities Purchase Agreement dated October 1, 2025 by and among the Company and Vanquish Funding Group Inc. (the "Purchase Agreement" terms not otherwise defined herein shall have the meaning ascribed to such terms in the Purchase Agreement), hereby certifies that:
1. I am the duly appointed Chief Executive Officer of the Company.
2. The representations and warranties made by the Company in Section 3 of the Purchase Agreement are true and correct in all material respects as of the date of this Officer's Certificate. The capitalization of the Company described in Section 3(c) of the Purchase Agreement has not changed as of the date hereof.
3. As of the date hereof, the Company has satisfied and duly performed all of the conditions and obligations specified in Section 7 of the Purchase Agreement to be satisfied on or prior to the Closing Date (as defined in the Purchase Agreement) or such conditions and obligations have been waived expressly in writing signed by the purchaser.
4. The Company has complied with or, if compliance prior to Closing (as defined in the Purchase Agreement) is not required, promptly following the Closing the Company will comply with, the filing requirements in respect of this transaction under (a) Regulation D under the Securities Act of 1933, as amended (the "1933 Act") (and applicable Blue Sky regulations) and (b) the Securities Exchange Act of 1934, as amended.
5. There has been no adverse change in the business, affairs, prospects, operations, properties, assets or condition of the Company since June 30, 2025, the date of the Company's most recent reviewed financial statements delivered to the Lender (as defined in the Purchase Agreement), other than losses and matters which would not, individually or in the aggregate, have a Material Adverse Effect (as defined in the Purchase Agreement).
6. The Company is qualified as a foreign corporation in all jurisdictions in which the Company owns or leases properties, or conducts any business except where failure of the Company to be so qualified would not have a Material Adverse Effect (as defined in the Purchase Agreement).
IN WITNESS WHEREOF, the undersigned has executed this Officer's Certificate as of October
| /s/ Bhaskar Panigrahi | |
| Bhaskar Panigrahi | |
| Chief Executive Officer |
ConnectM Technology Solutions, Inc.
October 1, 2025
Continental StockTransfer & Trust Co.
1 State Street Plaza, 30th Floor
New York, NY 10004
Ladies and Gentlemen:
ConnectM Technology Solutions, Inc., a Delaware corporation (the "Company") and Vanquish Funding Group Inc., a Virginia corporation (the "Lender") have entered into a Securities Purchase Agreement dated as of October 1, 2025 (the "Agreement") providing for the issuance of the Promissory Note in the principal amount of $230,160.00 (the "Note") which is convertible into common stock of the Company (“Common Stock”).
You are hereby irrevocably authorized and instructed to reserve a sufficient number of shares of Common Stock of the Company (initially, 8,852,307 shares) for issuance upon full conversion of the Note in accordance with the terms thereof. The amount of Common Stock so reserved may be increased, from time to time, upon the written instructions of the Company.
The ability to convert the Note in a timely manner is a material obligation of the Company pursuant to the Note. Provided you are acting as Transfer Agent at the time and provided no single issuance is greater than 4.99% of the issued and outstanding Common Stock of the Company, your firm is hereby irrevocably authorized and instructed to within two (2) Trading days issue shares of Common Stock of the Company to the Lender upon your receipt from the Lender of: (i) a notice of conversion (“Conversion Notice”) executed by the Lender with a copy concurrently delivered to the company, (ii) an opinion of the company’s counsel or counsel of the Lender, confirming that the Common Stock may be issued upon conversion of the Note without any transfer restrictions pursuant to an effective resale Registration Statement or pursuant to the exemption provided by Rule 144 (or any other available exemption) under the Federal Securities Act of 1933, as amended (the “Securities Act”), and (iii) copies of all supporting prospectus or Rule 144 documentation (a seller’s representation letter and a broker’s representation letter if the Common Stock has been held less than twelve months). Common Stock underlying each Conversion Notice should be issued, at the option of the Lender as specified in the Conversion Notice either (i) electronically by crediting the account of a Prime Broker with the Depository Trust Company through its Deposit Withdrawal at Custodian (“DWAC”) system provided the Lender causes its broker or bank to initiate a DWAC deposit or (ii) in certificated form without any restrictive legend which would restrict the transfer of the Common Stock, provided however that if such shares are not able to be sold under Rule 144 or any other exemption under the Securities Act and you have received an opinion from the Company’s or Lender’s counsel that the issuance of the Common Stock is exempt from registration under the Securities Act and when issued the Common Stock will be fully paid and non-assessable, then the issued certificates for such shares shall bear the following restrictive legend:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE SECURITIES MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER SAID ACT, OR AN OPINION OF COUNSEL IN FORM, SUBSTANCE AND SCOPE CUSTOMARY FOR OPINIONS OF COUNSEL IN COMPARABLE TRANSACTIONS, THAT REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT.
The Common Stock shall remain in the created reserve with the Transfer Agent until counsel to the Lender and an authorized officer of the Company provides joint written instructions to the Transfer Agent that the Common Stock or any part of them shall be taken out of the reserve and shall no longer be subject to the terms of these instructions.
The Company shall indemnify you and your officers, directors, principals, partners, agents and representatives, and hold each of them harmless from and against any and all loss, liability, damage, claim or expense (including the reasonable fees and disbursements of its attorneys) incurred by or asserted against you or any of them arising out of or in connection with the instructions set forth herein, the performance of your duties hereunder and otherwise in respect hereof, including the costs and expenses of defending yourself or themselves against any claim or liability including any claim which may be made or asserted by the Company, except that the Company shall not be liable hereunder as to matters in respect of which it is determined that you have acted with gross negligence or in bad faith. You shall have no liability to the Company and the Lender in respect of this if such action was taken or omitted to be taken in good faith, and you shall be entitled to rely in this regard and without liability on the advice of counsel, including counsel selected by you.
The Board of Directors of the Company has approved these irrevocable instructions and does hereby extend the Company’s irrevocable agreement to indemnify your firm for all loss, liability or expense in carrying out the authority and direction herein contained on the terms herein set forth.
The Company agrees that in the event that you resign as the Company’s transfer agent, the Company shall engage a suitable replacement transfer agent that will agree to serve as transfer agent for the Company within five (5) business days. The Company acknowledges that we will have the right to complete any issuance or conversion request received in good order prior to our resignation. It is also understood that you are permitted to resign without any stipulated conditions.
The Lender is intended to be and is a third party beneficiary hereof, and no amendment or modification to the instructions set forth herein may be made without the consent of the Lender.
Notwithstanding any other provision hereof, the Company and the Lender understand that you shall not be required to perform any issuance of the Common Stock if (a) such an issuance or transfer of Common Stock is in violation of any state or federal securities laws or regulations or (b) the issuance of the Common Stock is prohibited or stopped as required or directed by a court order from a court of competent jurisdiction. Additionally, Company and Lender understand that you shall not be required to perform any issuance of the Common Stock if Company is in default of its payment obligations under its agreement with you.
| Very truly yours, | |
| ConnectM Technology Solutions, Inc. | |
| /s/ Bhaskar Panigrahi | |
| Bhaskar Panigrahi | |
| Chief Executive Officer |
| Vanquish Funding Group Inc. | ||
| By: | /s/ Curt Kramer | |
| Curt Kramer | ||
| President | ||
| Acknowledged and Agreed: | ||
| Continental StockTransfer & Trust Co. | ||
| By: | ||
| Name: | ||
| Title: | ||
| Date: | ||
Exhibit 10.4
Funding date_________
Time:
DISBURSEMENT AUTHORIZATION
| TO: | Vanquish Funding Group Inc. |
| FROM: | ConnectM Technology Solutions, Inc. |
| Tranche #__ -________(CNTM) Bridge Note | |
| 2 Mount Royal Avenue, Suite 550 | |
| Marlborough, Massachusetts 01752 | |
| DATE: | October 7, 2025 |
| RE: | Disbursement of Funds for the Purchase of Securities |
In connection with the funding of an aggregate of $160,160.00 (including $17,160.00 of Original Issue Discount) pursuant to that certain Securities Purchase Agreement dated as of October 7, 2025 (the "Agreement"), you are hereby directed to disburse such funds as follows:
| 1. | $130,000.00 to ConnectM Technology Solutions, Inc. in accordance with the wire transfer instructions attached as Schedule A hereto; |
| 2. | $7,500.00 to Digital Offering LLC, a registered Broker/Dealer and member FINRA/SIPC, in accordance with the wire transfer instructions attached as Schedule B hereto; |
| 3. | $2,000.00 to Naidich Wurman LLP for legal fee reimbursement; and |
| 4. | $3,500.00 to be retained by Vanquish Funding Group Inc. for a due diligence fee. |
Upon receipt of such funds, you may release from escrow the Note, the Purchase Agreement and the instructions to Transfer Agent (each as defined in the Agreement).
| /s/ Bhaskar Panigrahi | |
| Bhaskar Panigrahi | |
| Chief Executive Officer |
Schedule A
| Bank Name: | "Name ConnectM Technology Solutions, Inc | |
| Account Name: | 2 Mount Royal Ave Ste 550 Marlborough, MA 01752 | |
| Swift Code: | Bank Info Bank of America, N.A. | |
| Routing #: | 100 West 33rd Street New York, NY 10001 | |
| Account#: | Account # 466006565743 | |
| Bank Address: | Routing Number (for ACH) 011000138 Routing Number (for Domestic Wire) 026009593 |
Schedule B
Wiring Instructions:
Chase Bank
30202 Crown Valley Parkway
Laguna Niguel, CA 92677
ABA Routing #: 322271627
Credit Account #: 682012870
Account Name: Digital Offering LLC
EIN: 46-0619588
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT.
THE ISSUE PRICE OF THIS NOTE IS $160,160.00
THE ORIGINAL ISSUE DISCOUNT IS $17,160.00
| Principal Amount: $160,160.00 | Issue Date: October 7, 2025 |
| Purchase Price: $143,000.00 |
PROMISSORY NOTE
FOR VALUE RECEIVED, ConnectM Technology Solutions, Inc., a Delaware corporation (hereinafter called the “Borrower”), hereby promises to pay to the order of Vanquish Funding Group Inc. a Virginia corporation, or registered assigns (the “Holder”) the sum of $160,160.00 together with any interest as set forth herein, on August 15, 2026 (the “Maturity Date”), and to pay interest on the unpaid principal balance hereof from the date hereof (the “Issue Date”) as set forth herein. This Note may not be prepaid in whole or in part except as otherwise explicitly set forth herein. Any amount of principal or interest on this Note which is not paid when due shall bear interest at the rate of twenty two percent (22%) per annum from the due date thereof until the same is paid (“Default Interest”). All payments due hereunder (to the extent not converted into common stock, $0.0001 par value per share (the “Common Stock”) in accordance with the terms hereof) shall be made in lawful money of the United States of America. All payments shall be made at such address as the Holder shall hereafter give to the Borrower by written notice made in accordance with the provisions of this Note. Each capitalized term used herein, and not otherwise defined, shall have the meaning ascribed thereto in that certain Securities Purchase Agreement dated the date hereof, pursuant to which this Note was originally issued (the “Purchase Agreement”).
This Note is free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the Borrower and will not impose personal liability upon the holder thereof.
The following terms shall apply to this Note:
ARTICLE I. GENERAL TERMS
1.1 Interest. A one-time interest charge of twelve percent (12%) (the “Interest Rate”) shall be applied on the Issuance Date to the Principal ($160,160.00 * twelve percent (12%) = $19,219.00). Interest hereunder shall be paid as set forth herein to the Holder or its assignee in whose name this Note is registered on the records of the Company regarding registration and transfers of Notes in cash or, in the Event of Default, at the Option of the Holder, converted into share of Common Stock as set forth herein.
1.2 Mandatory Monthly Payments. Accrued, unpaid interest and outstanding
principal, subject to adjustment, shall be paid in five (5) payments as follows:
| Payment Date | Amount of Payment | |||
| April 15, 2026 | $ | 89,689.50 | ||
| May 15, 2026 | $ | 22,422.38 | ||
| June 15, 2026 | $ | 22,422.38 | ||
| July 15, 2026 | $ | 22,422.38 | ||
| August 15, 2026 | $ | 22,422.36 | ||
(a total payback to the Holder of $179,379.00).
The Company shall have a five (5) day grace period with respect to each payment. The Company has right to prepay in full at any time with no prepayment penalty. All payments shall be made by bank wire transfer to the Holder’s wire instructions, attached hereto as Exhibit A. For the avoidance of doubt, a missed payment shall be considered an Event of Default.
1.3 Prepayment Discount. Notwithstanding anything to the contrary contained in
this Note, at any time during the period set forth on the table immediately following this paragraph (the “Prepayment Period”) or as otherwise agreed to between the Borrower and the Holder, the Borrower shall have the right, exercisable on not more than three (3) Trading Days prior written notice to the Holder of the Note to prepay the outstanding Note (principal and accrued interest), in full, in accordance with this Section 1.3. Any notice of prepayment hereunder (an “Optional Prepayment Notice”) shall be delivered to the Holder of the Note at its registered addresses and shall state: (1) that the Borrower is exercising its right to prepay the Note, and (2) the date of prepayment which shall be not more than three (3) Trading Days from the date of the Optional Prepayment Notice. On the date fixed for prepayment (the “Optional Prepayment Date”), the Borrower shall make payment of the Optional Prepayment Amount (as defined below) to Holder, or upon the direction of the Holder as specified by the Holder in a writing to the Borrower (which shall direction to be sent to Borrower by the Holder at least one (1) business day prior to the Optional Prepayment Date). If the Borrower exercises its right to prepay the Note, the Borrower shall make payment to the Holder of an amount in cash equal to the percentage (“Prepayment Percentage”) as set forth in the table immediately following this paragraph opposite the Prepayment Period, multiplied by the sum of the then outstanding principal amount of this Note plus any accrued and unpaid interest on the unpaid principal amount of this Note to the Optional Prepayment Date (the “Optional Prepayment Amount”).
| Prepayment Period | Prepayment Percentage |
| 1. The period beginning on the Issue Date and ending on the date which is ninety (90) days following the Issue Date. | 97% |
| 2. The period beginning on the date which is ninety-one (91) days following the Issue Date and ending on the date which is one hundred eighty (180) days following the Issue Date | 98% |
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ARTICLE II. CERTAIN COVENANTS
2.1 Sale of Assets. So long as the Borrower shall have any obligation under this Note, the Borrower shall not, without the Holder’s written consent, sell, lease or otherwise dispose of any significant portion of its assets outside the ordinary course of business. Any consent to the disposition of any assets may be conditioned on a specified use of the proceeds of disposition.
ARTICLE III. EVENTS OF DEFAULT
If any of the following events of default (each, an “Event of Default”) shall occur:
3.1 Failure to Pay Principal and Interest. The Borrower fails to pay the principal hereof or interest thereon when due on this Note, whether at maturity, upon acceleration or otherwise and such breach continues for a period of five (5) days after written notice from the Holder.
3.2 Conversion and the Shares. The Borrower fails to issue shares of Common Stock to the Holder (or announces or threatens in writing that it will not honor its obligation to do so) upon exercise by the Holder of the conversion rights of the Holder in accordance with the terms of this Note (following an Event of Default other than this Section 3.2), fails to transfer or cause its transfer agent to transfer (issue) (electronically or in certificated form) any certificate for shares of Common Stock issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note, the Borrower directs its transfer agent not to transfer or delays, impairs, and/or hinders its transfer agent in transferring (or issuing) (electronically or in certificated form) any certificate for shares of Common Stock to be issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note, or fails to remove (or directs its transfer agent not to remove or impairs, delays, and/or hinders its transfer agent from removing) any restrictive legend (or to withdraw any stop transfer instructions in respect thereof) on any certificate for any shares of Common Stock issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note (or makes any written announcement, statement or threat that it does not intend to honor the obligations described in this paragraph) and any such failure shall continue uncured (or any written announcement, statement or threat not to honor its obligations shall not be rescinded in writing) for three (3) business days after the Holder shall have delivered a Notice of Conversion. It is an obligation of the Borrower to remain current in its obligations to its transfer agent. It shall be an event of default of this Note, if a conversion of this Note is delayed, hindered or frustrated due to a balance owed by the Borrower to its transfer agent. If at the option of the Holder, the Holder advances any funds to the Borrower’s transfer agent in order to process a conversion, such advanced funds shall be paid by the Borrower to the Holder within forty-eight (48) hours of a demand from the Holder.
3.3 Breach of Covenants. The Borrower breaches any material covenant or other material term or condition contained in this Note and any collateral documents including but not limited to the Purchase Agreement and such breach continues for a period of twenty (20) days after written notice thereof to the Borrower from the Holder.
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3.4 Breach of Representations and Warranties. Any representation or warranty of the Borrower made herein or in any agreement, statement or certificate given in writing pursuant hereto or in connection herewith (including, without limitation, the Purchase Agreement), shall be false or misleading in any material respect when made and the breach of which has (or with the passage of time will have) a material adverse effect on the rights of the Holder with respect to this Note or the Purchase Agreement.
3.5 Receiver or Trustee. The Borrower or any subsidiary of the Borrower shall make an assignment for the benefit of creditors, or apply for or consent to the appointment of a receiver or trustee for it or for a substantial part of its property or business, or such a receiver or trustee shall otherwise be appointed.
3.6 Bankruptcy. Bankruptcy, insolvency, reorganization or liquidation proceedings or other proceedings, voluntary or involuntary, for relief under any bankruptcy law or any law for the relief of debtors shall be instituted by or against the Borrower or any subsidiary of the Borrower.
3.7 Delisting of Common Stock. The Borrower shall fail to maintain the listing of the Common Stock on the OTC Markets, Nasdaq National Market, the Nasdaq SmallCap Market, the New York Stock Exchange, or the NYSE American Stock Exchange.
3.8 Failure to Comply with the Exchange Act. If the Borrower is in breach of Section 3.1 hereof and the Borrower shall fail to comply with the reporting requirements of the Exchange Act and such failure occurs or is continuing at any time following the date which is 180 days from the date of this Note; and/or the Borrower shall cease to be subject to the reporting requirements of the Exchange Act.
3.9 Liquidation. Any dissolution, liquidation, or winding up of Borrower or any substantial portion of its business.
3.10 Cessation of Operations. Any cessation of operations by Borrower or Borrower admits it is otherwise generally unable to pay its debts as such debts become due, provided, however, that any disclosure of the Borrower’s ability to continue as a “going concern” shall not be an admission that the Borrower cannot pay its debts as they become due.
3.11 Financial Statement Restatement. The restatement of any financial statements filed by the Borrower with the SEC at any time after 180 days after the Issuance Date for any date or period until this Note is no longer outstanding, if the result of such restatement would, by comparison to the un-restated financial statement, have constituted a material adverse effect on the rights of the Holder with respect to this Note or the Purchase Agreement.
3.12 Replacement of Transfer Agent. In the event that the Borrower proposes to replace its transfer agent, the Borrower fails to provide, prior to the effective date of such replacement, a fully executed Irrevocable Transfer Agent Instructions in a form as initially delivered pursuant to the Purchase Agreement (including but not limited to the provision to irrevocably reserve shares of Common Stock in the Reserved Amount) signed by the successor transfer agent to Borrower and the Borrower.
3.13 Cross-Default. Notwithstanding anything to the contrary contained in this Note or the other related or companion documents, a breach or default by the Borrower of any covenant or other term or condition contained in any of the Other Agreements, after the passage of all applicable notice and cure or grace periods, shall, at the option of the Holder, be considered a default under this Note and the Other Agreements, in which event the Holder shall be entitled (but in no event required) to apply all rights and remedies of the Holder under the terms of this Note and the Other Agreements by reason of a default under said Other Agreement or hereunder. “Other Agreements” means, collectively, all agreements and instruments between, among or by: (1) the Borrower, and, or for the benefit of, (2) the Holder and any affiliate of the Holder, including, without limitation, promissory notes; provided, however, the term “Other Agreements” shall not include the related or companion documents to this Note. Each of the loan transactions will be cross-defaulted with each other loan transaction and with all other existing and future debt of Borrower to the Holder. Furthermore, notwithstanding anything contained herein to the contrary or in any of the Other Agreements to the contrary, in the event of default of any Other Agreements and such Other Agreements are convertible into shares of Common Stock, Section 4.6 (d) Adjustment Due to Market Price hereof shall be applied to each such Other Agreement as if such section was included within such Other Agreement and the principal amount due with respect to such Other Agreement shall be adjusted accordingly.
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Upon the occurrence and during the continuation of any Event of Default, the Note shall become immediately due and payable and the Borrower shall pay to the Holder, in full satisfaction of its obligations hereunder, an amount equal to 150% (“Default Percentage”) times the sum of (w) the then outstanding principal amount of this Note plus (x) accrued and unpaid interest on the unpaid principal amount of this Note to the date of payment plus (y) Default Interest, if any, on the amounts referred to in clauses (w) and/or (x) plus (z) any amounts owed to the Holder pursuant to Article IV hereof (the then outstanding principal amount of this Note to the date of payment plus the amounts referred to in clauses (x), (y) and (z) shall collectively be known as the “Default Amount”) and all other amounts payable hereunder shall immediately become due and payable, all without demand, presentment or notice, all of which hereby are expressly waived, together with all costs, including, without limitation, legal fees and expenses, of collection, and the Holder shall be entitled to exercise all other rights and remedies available at law or in equity. Notwithstanding anything to the contrary contained herein, in the event that following an Event of Default (other than Section 3.2), a default pursuant to Section 3.2 occurs, the Default Percentage shall be immediately adjusted to 200%.
If the Borrower fails to pay the Default Amount within five (5) business days of written notice that such amount is due and payable, then the Holder shall have the right at any time, to convert the balance owed pursuant to the note including the Default Amount into shares of common stock of the Company as set forth herein.
ARTICLE IV. CONVERSION RIGHTS
4.1 Conversion Right. At any time following an Event of Default and not less than 180 days following the date of this Note, the Holder shall have the right, to convert all or any part of the outstanding and unpaid amount of this Note into fully paid and non-assessable shares of Common Stock, as such Common Stock exists on the Issue Date, or any shares of capital stock or other securities of the Borrower into which such Common Stock shall hereafter be changed or reclassified at the conversion price determined as provided herein (a “Conversion”); provided, however, that in no event shall the Holder be entitled to convert any portion of this Note in excess of that portion of this Note upon conversion of which the sum of (1) the number of shares of Common Stock beneficially owned by the Holder and its affiliates (other than shares of Common Stock which may be deemed beneficially owned through the ownership of the unconverted portion of the Notes or the unexercised or unconverted portion of any other security of the Borrower subject to a limitation on conversion or exercise analogous to the limitations contained herein) and (2) the number of shares of Common Stock issuable upon the conversion of the portion of this Note with respect to which the determination of this proviso is being made, would result in beneficial ownership by the Holder and its affiliates of more than 4.99% of the outstanding shares of Common Stock. For purposes of the proviso to the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Regulations 13D-G thereunder, except as otherwise provided in clause (1) of such proviso. The beneficial ownership limitations on conversion as set forth in the section may NOT be waived by the Holder. The number of shares of Common Stock to be issued upon each conversion of this Note shall be determined by dividing the Conversion Amount (as defined below) by the applicable Conversion Price then in effect on the date specified in the notice of conversion, in the form attached hereto as Exhibit B(the “Notice of Conversion”), delivered to the Borrower by the Holder in accordance with Section 4.4 below; provided that the Notice of Conversion is submitted by facsimile or e-mail (or by other means resulting in, or reasonably expected to result in, notice) to the Borrower before 6:00 p.m., New York, New York time on such conversion date (the “Conversion Date”); however, if the Notice of Conversion is sent after 6:00pm, New York, New York time the Conversion Date shall be the next business day. The term “Conversion Amount” means, with respect to any conversion of this Note, the sum of (1) the principal amount of this Note to be converted in such conversion plus (2) at the Holder’s option, accrued and unpaid interest, if any, on such principal amount at the interest rates provided in this Note to the Conversion Date, plus (3) at the Holder’s option, Default Interest, if any, on the amounts referred to in the immediately preceding clauses (1) and/or (2) plus (4) at the Holder’s option, any amounts owed to the Holder pursuant to Sections 4.4 hereof. Limitation shall no longer apply to limit the issuance of shares in conversion of this Note.
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The Holder shall be entitled to deduct $1,500.00 from the conversion amount in each Notice of Conversion to cover Holder's deposit fees associated with each Notice of Conversion. Any additional expenses incurred by Holder with respect to the Borrower's transfer agent, for the issuance of the Common Stock into which this Note is convertible into, shall immediately and automatically be added to the balance of the Note at such time as the expenses are incurred by Holder.
4.1 Conversion Price. The conversion price (the “Conversion Price”) shall mean the greater of: (i) $0.05 (the “Fixed Conversion Price”); or (ii) 65% multiplied by the lowest Trading Price for the Common Stock during the ten (10) Trading Days prior to the Conversion Date (the “Variable Conversion Price”)(subject to equitable adjustments by the Borrower relating to the Borrower’s securities or the securities of any subsidiary of the Borrower, combinations, recapitalization, reclassifications, extraordinary distributions and similar events). “Trading Price” means, for any security as of any date, the closing bid price on the OTCQB, OTCQX, Pink Sheets electronic quotation system or applicable trading market (the “OTC”) as reported by a reliable reporting service (“Reporting Service”) designated by the Holder (i.e. Bloomberg) or, if the OTC is not the principal trading market for such security, the closing bid price of such security on the principal securities exchange or trading market where such security is listed or traded or, if no closing bid price of such security is available in any of the foregoing manners, the average of the closing bid prices of any market makers for such security that are listed in the “pink sheets”. If the Trading Price cannot be calculated for such security on such date in the manner provided above, the Trading Price shall be the fair market value as mutually determined by the Borrower and the holders of a majority in interest of the Notes being converted for which the calculation of the Trading Price is required in order to determine the Conversion Price of such Notes. “Trading Day” shall mean any day on which the Common Stock is tradable for any period on the OTC, or on the principal securities exchange or other securities market on which the Common Stock is then being traded.
4.2 Authorized Shares. The Borrower covenants that during the period that the Note is outstanding, the Borrower will reserve from its authorized and unissued Common Stock a sufficient number of shares, free from preemptive rights, to provide for the issuance of Common Stock upon the full conversion of this Note issued pursuant to the Purchase Agreement. The Borrower is required at all times to have authorized and reserved four times the number of shares that is actually issuable upon full conversion of the Note (based on the Conversion Price of the Note in effect from time to time) (the “Reserved Amount”). The Reserved Amount shall be increased from time to time in accordance with the Borrower’s obligations hereunder. The Borrower represents that upon issuance, such shares will be duly and validly issued, fully paid and non-assessable. In addition, if the Borrower shall issue any securities or make any change to its capital structure which would change the number of shares of Common Stock into which the Notes shall be convertible at the then current Conversion Price, the Borrower shall at the same time make proper provision so that thereafter there shall be a sufficient number of shares of Common Stock authorized and reserved, free from preemptive rights, for conversion of the outstanding Note. The Borrower (i) acknowledges that it has irrevocably instructed its transfer agent to issue certificates for the Common Stock issuable upon conversion of this Note, and (ii) agrees that its issuance of this Note shall constitute full authority to its officers and agents who are charged with the duty of executing stock certificates to execute and issue the necessary certificates for shares of Common Stock in accordance with the terms and conditions of this Note.
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If, at any time the Borrower does not maintain the Reserved Amount it will be considered an Event of Default under this Note.
4.3 Method of Conversion.
(a) Mechanics of Conversion. As set forth in Section 4.1 hereof, at any time following an Event of Default, the balance due pursuant to this Note may be converted by the Holder in whole or in part at any time from time to time after the Issue Date, by (A) submitting to the Borrower a Notice of Conversion (by facsimile, e-mail or other reasonable means of communication dispatched on the Conversion Date prior to 6:00 p.m., New York, New York time) and (B) subject to Section 4.4(b), surrendering this Note at the principal office of the Borrower (upon payment in full of any amounts owed hereunder).
(b) Surrender of Note Upon Conversion. Notwithstanding anything to the contrary set forth herein, upon conversion of this Note in accordance with the terms hereof, the Holder shall not be required to physically surrender this Note to the Borrower unless the entire unpaid principal amount of this Note is so converted. The Holder and the Borrower shall maintain records showing the principal amount so converted and the dates of such conversions or shall use such other method, reasonably satisfactory to the Holder and the Borrower, so as not to require physical surrender of this Note upon each such conversion.
(c) Delivery of Common Stock Upon Conversion. Upon receipt by the Borrower from the Holder of a facsimile transmission or e-mail (or other reasonable means of communication) of a Notice of Conversion meeting the requirements for conversion as provided in this Section 4.4, the Borrower shall issue and deliver or cause to be issued and delivered to or upon the order of the Holder certificates for the Common Stock issuable upon such conversion within three (3) business days after such receipt (the “Deadline”) (and, solely in the case of conversion of the entire unpaid principal amount hereof, surrender of this Note) in accordance with the terms hereof and the Purchase Agreement. Upon receipt by the Borrower of a Notice of Conversion, the Holder shall be deemed to be the holder of record of the Common Stock issuable upon such conversion, the outstanding principal amount and the amount of accrued and unpaid interest on this Note shall be reduced to reflect such conversion, and, unless the Borrower defaults on its obligations hereunder, all rights with respect to the portion of this Note being so converted shall forthwith terminate except the right to receive the Common Stock or other securities, cash or other assets, as herein provided, on such conversion. If the Holder shall have given a Notice of Conversion as provided herein, the Borrower’s obligation to issue and deliver the certificates for Common Stock shall be absolute and unconditional, irrespective of the absence of any action by the Holder to enforce the same, any waiver or consent with respect to any provision thereof, the recovery of any judgment against any person or any action to enforce the same, any failure or delay in the enforcement of any other obligation of the Borrower to the holder of record, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder of any obligation to the Borrower, and irrespective of any other circumstance which might otherwise limit such obligation of the Borrower to the Holder in connection with such conversion.
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(d) Delivery of Common Stock by Electronic Transfer. In lieu of delivering physical certificates representing the Common Stock issuable upon conversion, provided the Borrower is participating in the Depository Trust Company (“DTC”) Fast Automated Securities Transfer (“FAST”) program, upon request of the Holder and its compliance with the provisions set forth herein, the Borrower shall use its best efforts to cause its transfer agent to electronically transmit the Common Stock issuable upon conversion to the Holder by crediting the account of Holder’s Prime Broker with DTC through its Deposit and Withdrawal at Custodian (“DWAC”) system.
(e) Failure to Deliver Common Stock Prior to Deadline. Without in any way limiting the Holder’s right to pursue other remedies, including actual damages and/or equitable relief, the parties agree that if delivery of the Common Stock issuable upon conversion of this Note is not delivered by the Deadline due to action and/or inaction of the Borrower, the Borrower shall pay to the Holder $2,000 per day in cash, for each day beyond the Deadline that the Borrower fails to deliver such Common Stock (the “Fail to Deliver Fee”); provided; however that the Fail to Deliver Fee shall not be due if the failure is a result of a third party (i.e., transfer agent; and not the result of any failure to pay such transfer agent) despite the best efforts of the Borrower to effect delivery of such Common Stock. Such cash amount shall be paid to Holder by the fifth day of the month following the month in which it has accrued or, at the option of the Holder (by written notice to the Borrower by the first day of the month following the month in which it has accrued), shall be added to the principal amount of this Note, in which event interest shall accrue thereon in accordance with the terms of this Note and such additional principal amount shall be convertible into Common Stock in accordance with the terms of this Note. The Borrower agrees that the right to convert is a valuable right to the Holder. The damages resulting from a failure, attempt to frustrate, interference with such conversion right are difficult if not impossible to qualify. Accordingly, the parties acknowledge that the liquidated damages provision contained in this Section 4.4(e) are justified.
4.4 Concerning the Shares. The shares of Common Stock issuable upon conversion of this Note may not be sold or transferred unless: (i) such shares are sold pursuant to an effective registration statement under the Act or (ii) the Borrower or its transfer agent shall have been furnished with an opinion of counsel (which opinion shall be in form, substance and scope customary for opinions of counsel in comparable transactions) to the effect that the shares to be sold or transferred may be sold or transferred pursuant to an exemption from such registration (such as Rule 144 or a successor rule) (“Rule 144”); or (iii) such shares are transferred to an “affiliate” (as defined in Rule 144) of the Borrower who agrees to sell or otherwise transfer the shares only in accordance with this Section 4.5 and who is an Accredited Investor (as defined in the Purchase Agreement).
Any restrictive legend on certificates representing shares of Common Stock issuable upon conversion of this Note shall be removed and the Borrower shall issue to the Holder a new certificate therefore free of any transfer legend if the Borrower or its transfer agent shall have received an opinion of counsel from Holder’s counsel, in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect that (i) a public sale or transfer of such Common Stock may be made without registration under the Act, which opinion shall be accepted by the Company so that the sale or transfer is effected; or (ii) in the case of the Common Stock issuable upon conversion of this Note, such security is registered for sale by the Holder under an effective registration statement filed under the Act; or otherwise may be sold pursuant to an exemption from registration. In the event that the Company does not reasonably accept the opinion of counsel provided by the Holder with respect to the transfer of Securities pursuant to an exemption from registration (such as Rule 144), it will be considered an Event of Default pursuant to this Note.
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4.5 Effect of Certain Events.
(a) Effect of Merger, Consolidation, Etc. At the option of the Holder, the sale, conveyance or disposition of all or substantially all of the assets of the Borrower, the effectuation by the Borrower of a transaction or series of related transactions in which more than 50% of the voting power of the Borrower is disposed of, or the consolidation, merger or other business combination of the Borrower with or into any other Person (as defined below) or Persons when the Borrower is not the survivor shall be deemed to be an Event of Default (as defined in Article III) pursuant to which the Borrower shall be required to pay to the Holder upon the consummation of and as a condition to such transaction an amount equal to the Default Amount (as defined in Article III). “Person” shall mean any individual, corporation, limited liability company, partnership, association, trust or other entity or organization.
(b) Adjustment Due to Merger, Consolidation, Etc. If, at any time when this Note is issued and outstanding and prior to conversion of all of the Note, there shall be any merger, consolidation, exchange of shares, recapitalization, reorganization, or other similar event, as a result of which shares of Common Stock of the Borrower shall be changed into the same or a different number of shares of another class or classes of stock or securities of the Borrower or another entity, or in case of any sale or conveyance of all or substantially all of the assets of the Borrower other than in connection with a plan of complete liquidation of the Borrower, then the Holder of this Note shall thereafter have the right to receive upon conversion of this Note, upon the basis and upon the terms and conditions specified herein and in lieu of the shares of Common Stock immediately theretofore issuable upon conversion, such stock, securities or assets which the Holder would have been entitled to receive in such transaction had this Note been converted in full immediately prior to such transaction (without regard to any limitations on conversion set forth herein), and in any such case appropriate provisions shall be made with respect to the rights and interests of the Holder of this Note to the end that the provisions hereof (including, without limitation, provisions for adjustment of the Conversion Price and of the number of shares issuable upon conversion of the Note) shall thereafter be applicable, as nearly as may be practicable in relation to any securities or assets thereafter deliverable upon the conversion hereof. The Borrower shall not affect any transaction described in this Section 4.6(b) unless (a) it first gives, to the extent practicable, ten (10) days prior written notice (but in any event at least five (5) days prior written notice) of the record date of the special meeting of shareholders to approve, or if there is no such record date, the consummation of, such merger, consolidation, exchange of shares, recapitalization, reorganization or other similar event or sale of assets (during which time the Holder shall be entitled to convert this Note) and (b) the resulting successor or acquiring entity (if not the Borrower) assumes by written instrument the obligations of this Note. The above provisions shall similarly apply to successive consolidations, mergers, sales, transfers or share exchanges.
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(c) Adjustment Due to Distribution. If the Borrower shall declare or make any distribution of its assets (or rights to acquire its assets) to holders of Common Stock as a dividend, stock repurchase, by way of return of capital or otherwise (including any dividend or distribution to the Borrower’s shareholders in cash or shares (or rights to acquire shares) of capital stock of a subsidiary (i.e., a spin-off)) (a “Distribution”), then the Holder of this Note shall be entitled, upon any conversion of this Note after the date of record for determining shareholders entitled to such Distribution, to receive the amount of such assets which would have been payable to the Holder with respect to the shares of Common Stock issuable upon such conversion had such Holder been the holder of such shares of Common Stock on the record date for the determination of shareholders entitled to such Distribution.
(d) Adjustment Due to Market Price. If at any time the Market Price, as determined on the date of each conversion, is less than the Conversion Price, then the Default Amount due pursuant to this Note shall be increased immediately following each such conversion by the result of the Conversion Price minus the Market Price multiplied by the amount of shares of common stock being issued with respect to such conversion. “Market Price” shall mean the lowest closing bid price for the Common Stock during ten (10) Trading Days prior to the applicable date of conversion. “Trading Day” shall mean any day on which the Common Stock is tradable for any period on the trading market, or on the principal securities exchange or other securities market on which the Common Stock is then being traded. For example, the Conversion Price is $0.05 and if the Market Price is $0.01 and the amount of shares issued upon conversion is 10,000 shares, then the Default Amount shall be increased by $400.00 ($0.01 - $0.05 = $0.04 multiplied by 10,000 = 400.00) immediately following such conversion.
ARTICLE V. MISCELLANEOUS
5.1 Failure or Indulgence Not Waiver. No failure or delay on the part of the 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 privileges. All rights and remedies existing hereunder are cumulative to, and not exclusive of, any rights or remedies otherwise available.
5.2 Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by hand delivery, telegram, or electronic mail, addressed as set forth below or to such other address as such party shall have specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery or delivery by electronic mail, at the address or number designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall be:
If to the Borrower, to:
ConnectM Technology Solutions, Inc.
2 Mount Royal Avenue, Suite 550
Marlborough, Massachusetts 01752
Attn: Bhaskar Panigrahi, Chief Executive Officer
Email: [email protected]
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If to the Holder:
Vanquish Funding Group Inc.
1800 Diagonal Road, Suite 623
Alexandria VA 22314
Attn: Curt Kramer
e-mail: [email protected]
5.3 Amendments. This Note and any provision hereof may only be amended by an instrument in writing signed by the Borrower and the Holder. The term “Note” and all reference thereto, as used throughout this instrument, shall mean this instrument (and the other Notes issued pursuant to the Purchase Agreement) as originally executed, or if later amended or supplemented, then as so amended or supplemented.
5.4 Assignability. This Note shall be binding upon the Borrower and its successors and assigns, and shall inure to be the benefit of the Holder and its successors and assigns. Each transferee of this Note must be an “accredited investor” (as defined in Rule 501(a) of the Securities and Exchange Commission). Notwithstanding anything in this Note to the contrary, this Note may be pledged as collateral in connection with a bona fide margin account or other lending arrangement; and may be assigned by the Holder without the consent of the Borrower.
5.5 Cost of Collection. If default is made in the payment of this Note, the Borrower shall pay the Holder hereof costs of collection, including reasonable attorneys’ fees.
5.6 Governing Law. This Note shall be governed by and construed in accordance with the laws of the Commonwealth of Virginia without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Note shall be brought only in the Circuit Court of Fairfax County, Virginia or in the Alexandria Division of the United States District Court for the Eastern District of Virginia. The parties to this Note hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. The Borrower and Holder waive trial by jury. The Holder shall be entitled to recover from the Borrower its reasonable attorney's fees and costs. In the event that any provision of this Note or any other agreement delivered in connection herewith is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of any agreement. Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this Note, any agreement or any other document delivered in connection with this Note by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Note and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
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5.7 Purchase Agreement. By its acceptance of this Note, each party agrees to be bound by the applicable terms of the Purchase Agreement.
5.8 Remedies. The Borrower acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder, by vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the Borrower acknowledges that the remedy at law for a breach of its obligations under this Note will be inadequate and agrees, in the event of a breach or threatened breach by the Borrower of the provisions of this Note, that the Holder shall be entitled, in addition to all other available remedies at law or in equity, and in addition to the penalties assessable herein, to an injunction or injunctions restraining, preventing or curing any breach of this Note and to enforce specifically the terms and provisions thereof, without the necessity of showing economic loss and without any bond or other security being required.
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IN WITNESS WHEREOF, Borrower has caused this Note to be signed in its name by its duly authorized officer this on October 7, 2025
| ConnectM Technology Solutions, Inc. | ||
| By: | /s/ Bhaskar Panigrahi | |
| Bhaskar Panigrahi | ||
| Chief Executive Officer | ||
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EXHIBIT A – WIRE INSTRUCTIONS
[to be provided via email]
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EXHIBIT B -- NOTICE OF CONVERSION
The undersigned hereby elects to convert $__________________ principal amount of the Note (defined below) into that number of shares of Common Stock to be issued pursuant to the conversion of the Note (“Common Stock”) as set forth below, of ConnectM Technology Solutions, Inc., a Delaware corporation (the “Borrower”) according to the conditions of the convertible note of the Borrower dated as of October 7, 2025 (the “Note”), as of the date written below. No fee will be charged to the Holder for any conversion, except for transfer taxes, if any.
Box Checked as to applicable instructions:
| [ ] | The Borrower shall electronically transmit the Common Stock issuable pursuant to this Notice of Conversion to the account of the undersigned or its nominee with DTC through its Deposit Withdrawal Agent Commission system (“DWAC Transfer”). | |
| Name of DTC Prime Broker: | ||
| Account Number: | ||
| [ ] | The undersigned hereby requests that the Borrower issue a certificate or certificates for the number of shares of Common Stock set forth below (which numbers are based on the Holder’s calculation attached hereto) in the name(s) specified immediately below or, if additional space is necessary, on an attachment hereto: |
| Date of conversion: | ||||
| Applicable Conversion Price: | $ | |||
| Number of shares of common stock to be issued pursuant to conversion of the Notes: | ||||
| Amount of Principal Balance due remaining under the Note after this conversion: | ||||
| By: | |||
| Name: | |||
| Title: | |||
| Date: |
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SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT (the “Agreement”), dated as of October 7, 2025, by and between ConnectM Technology Solutions, Inc., a Delaware corporation, with its address at 2 Mount Royal Avenue, Suite 550, Marlborough, Massachusetts 01752 (the “Company”), and Vanquish Funding Group Inc., a Virginia corporation, with its address at 1800 Diagonal Road, Suite 623, Alexandria VA 22314 (the “Buyer”).
WHEREAS:
A. The Company and the Buyer are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by the rules and regulations as promulgated by the United States Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the “1933 Act”); and
B. Buyer desires to purchase and the Company desires to issue and sell, upon the terms and conditions set forth in this Agreement, a bridge note of the Company, in the form attached hereto as Exhibit A, in the aggregate principal amount of $160,160.00 (including $17,160.00 of Original Issue Discount) (the “Note”).
NOW THEREFORE, the Company and the Buyer severally (and not jointly) hereby agree as follows:
1. Purchase and Sale of the Securities.
a. Purchase of the Securities. On the Closing Date (as defined below), the Company shall issue and sell to the Buyer and the Buyer agrees to purchase from the Company the Securities as is set forth immediately below the Buyer’s name on the signature pages hereto.
b. Form of Payment. On the Closing Date (as defined below), (i) the Buyer shall pay the purchase price for the Securities be issued and sold to it at the Closing (as defined below) (the “Purchase Price”) by wire transfer of immediately available funds to the Company, in accordance with the Company’s written wiring instructions, against delivery of the Securities, and (ii) the Company shall deliver such duly executed Note on behalf of the Company against delivery of such Purchase Price.
c. Closing Date. Subject to the satisfaction (or written waiver) of the conditions thereto set forth in Section 6 and Section 7 below, the date and time of the issuance and sale of the Securities pursuant to this Agreement (the “Closing Date”) shall be 12:00 noon, Eastern Standard Time on or about October 8, 2025, or such other mutually agreed upon time. The closing of the transactions contemplated by this Agreement (the “Closing”) shall occur on the Closing Date at such location as may be agreed to by the parties.
2. Buyer’s Representations and Warranties. The Buyer represents and warrants to the Company that:
a. Investment Purpose. As of the date hereof, the Buyer is purchasing the Note and the shares of Common Stock issuable upon conversion of or otherwise pursuant to the Note (such shares of Common Stock being collectively referred to herein as the “Conversion Shares” and, collectively with the Note, the “Securities”) for its own account and not with a present view towards the public sale or distribution thereof, except pursuant to sales registered or exempted from registration under the 1933 Act.
b. Accredited Investor Status. The Buyer is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D (an “Accredited Investor”).
c. Reliance on Exemptions. The Buyer understands that the Securities are being offered and sold to it in reliance upon specific exemptions from the registration requirements of United States federal and state securities laws and that the Company is relying upon the truth and accuracy of, and the Buyer’s compliance with, the representations, warranties, agreements, acknowledgments and understandings of the Buyer set forth herein in order to determine the availability of such exemptions and the eligibility of the Buyer to acquire the Securities.
d. Information. The Company has not disclosed to the Buyer any material nonpublic information and will not disclose such information unless such information is disclosed to the public prior to or promptly following such disclosure to the Buyer.
e. Legends. The Buyer understands that the Securities have not been registered under the 1933 Act; and may bear a restrictive legend in substantially the following form:
"THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER ANY STATE SECURITIES LAWS, AND MAY NOT BE PLEDGED, SOLD, ASSIGNED, HYPOTHECATED OR OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR (2) THE ISSUER OF SUCH SECURITIES RECEIVES AN OPINION OF COUNSEL TO THE BUYER OF SUCH SECURITIES, WHICH COUNSEL AND OPINION ARE REASONABLY ACCEPTABLE TO THE ISSUER’S TRANSFER AGENT, THAT SUCH SECURITIES MAY BE PLEDGED, SOLD, ASSIGNED, HYPOTHECATED OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS."
The legend set forth above shall be removed and the Company shall issue a certificate without such legend to the Buyer of any Security upon which it is stamped, if, unless otherwise required by applicable state securities laws, (a) such Security is registered for sale under an effective registration statement filed under the 1933 Act or otherwise may be sold pursuant to an exemption from registration without any restriction as to the number of securities as of a particular date that can then be immediately sold, or (b) such Buyer provides the Company with an opinion of counsel, in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect that a public sale or transfer of such Security may be made without registration under the 1933 Act, which opinion shall be accepted by the Company so that the sale or transfer is effected. The Buyer agrees to sell all Securities, including those represented by a certificate(s) from which the legend has been removed, in compliance with applicable prospectus delivery requirements, if any. In the event that the Company does not reasonably accept the opinion of counsel that properly conforms to applicable securities laws provided by the Buyer with respect to the transfer of any Securities pursuant to an exemption from registration, such as Rule 144, at the Deadline, it will be considered an Event of Default pursuant to Section 3.2 of the Note.
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f. Authorization; Enforcement. This Agreement has been duly and validly authorized. This Agreement has been duly executed and delivered on behalf of the Buyer, and this Agreement constitutes a valid and binding agreement of the Buyer enforceable in accordance with its terms.
3. Representations and Warranties of the Company. The Company represents and warrants to the Buyer that:
a. Organization and Qualification. The Company and each of its Subsidiaries (as defined below), if any, is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is incorporated, with full power and authority (corporate and other) to own, lease, use and operate its properties and to carry on its business as and where now owned, leased, used, operated and conducted. “Subsidiaries” means any corporation or other organization, whether incorporated or unincorporated, in which the Company owns, directly or indirectly, any equity or other ownership interest.
b. Authorization; Enforcement. (i) The Company has all requisite corporate power and authority to enter into and perform this Agreement, the Note and to consummate the transactions contemplated hereby and thereby and to issue the Securities, in accordance with the terms hereof and thereof, (ii) the execution and delivery of this Agreement, the Note by the Company and the consummation by it of the transactions contemplated hereby and thereby (including without limitation, the issuance of the Note has been duly authorized by the Company’s Board of Directors and no further consent or authorization of the Company, its Board of Directors, or its shareholders is required, (iii) this Agreement has been duly executed and delivered by the Company by its authorized representative, and such authorized representative is the true and official representative with authority to sign this Agreement and the other documents executed in connection herewith and bind the Company accordingly, and (iv) this Agreement constitutes, and upon execution and delivery by the Company of the Note, each of such instruments will constitute, a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms.
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c. Capitalization. As of the date hereof, the authorized common stock of the Company consists of 100,000,000 authorized shares of Common Stock, $0.0001 par value per share, of which 94,726,710 shares are issued and outstanding. All of such outstanding shares of capital stock are, or upon issuance will be, duly authorized, validly issued, fully paid and non-assessable.
d. Issuance of Shares. The Securities are duly authorized and reserved for issuance in accordance with its respective terms, will be validly issued, fully paid and non-assessable, and free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the Company and will not impose personal liability upon the Buyer thereof.
e. No Conflicts. The execution, delivery and performance of this Agreement, the Note by the Company and the consummation by the Company of the transactions contemplated hereby and thereby will not (i) conflict with or result in a violation of any provision of the Certificate of Incorporation or By-laws, or (ii) violate or conflict with, or result in a breach of any provision of, or constitute a default (or an event which with notice or lapse of time or both could become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture, patent, patent license or instrument to which the Company or any of its Subsidiaries is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities laws and regulations and regulations of any self-regulatory organizations to which the Company or its securities are subject) applicable to the Company or any of its Subsidiaries or by which any property or asset of the Company or any of its Subsidiaries is bound or affected (except for such conflicts, defaults, terminations, amendments, accelerations, cancellations and violations as would not, individually or in the aggregate, have a Material Adverse Effect). The businesses of the Company and its Subsidiaries, if any, are not being conducted, and shall not be conducted so long as the Buyer owns any of the Securities, in violation of any law, ordinance or regulation of any governmental entity. “Material Adverse Effect” means any material adverse effect on the business, operations, assets, financial condition or prospects of the Company or its Subsidiaries, if any, taken as a whole, or on the transactions contemplated hereby or by the agreements or instruments to be entered into in connection herewith.
f. SEC Documents; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required to be filed by it with the SEC pursuant to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “1934 Act”) (all of the foregoing filed prior to the date hereof and all exhibits included therein and financial statements and schedules thereto and documents (other than exhibits to such documents) incorporated by reference therein, being hereinafter referred to herein as the “SEC Documents”). Upon written request the Company will deliver to the Buyer true and complete copies of the SEC Documents, except for such exhibits and incorporated documents. As of their respective dates or if amended, as of the dates of the amendments, the SEC Documents complied in all material respects with the requirements of the 1934 Act and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents, and none of the SEC Documents, at the time they were filed with the SEC, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. None of the statements made in any such SEC Documents is, or has been, required to be amended or updated under applicable law (except for such statements as have been amended or updated in subsequent filings prior the date hereof). As of their respective dates or if amended, as of the dates of the amendments, the financial statements of the Company included in the SEC Documents complied as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto. Such financial statements have been prepared in accordance with United States generally accepted accounting principles, consistently applied, during the periods involved and fairly present in all material respects the consolidated financial position of the Company and its consolidated Subsidiaries as of the dates thereof and the consolidated results of their operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments). The Company is subject to the reporting requirements of the 1934 Act.
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g. Absence of Certain Changes. Since June 30, 2025, except as set forth in the SEC Documents, there has been no material adverse change and no material adverse development in the assets, liabilities, business, properties, operations, financial condition, results of operations, prospects or 1934 Act reporting status of the Company or any of its Subsidiaries.
h. Absence of Litigation. Except as set forth in the SEC Documents, there is no action, suit, claim, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the Company or any of its Subsidiaries, threatened against or affecting the Company or any of its Subsidiaries, or their officers or directors in their capacity as such, that could have a Material Adverse Effect. The Company and its Subsidiaries are unaware of any facts or circumstances which might give rise to any of the foregoing.
i. No Integrated Offering. Neither the Company, nor any of its affiliates, nor any person acting on its or their behalf, has directly or indirectly made any offers or sales in any security or solicited any offers to buy any security under circumstances that would require registration under the 1933 Act of the issuance of the Securities to the Buyer. The issuance of the Securities to the Buyer will not be integrated with any other issuance of the Company’s securities (past, current or future) for purposes of any shareholder approval provisions applicable to the Company or its securities.
j. No Brokers. Except for Digital Offering LLC, the Company has taken no action which would give rise to any claim by any person for brokerage commissions, transaction fees or similar payments relating to this Agreement or the transactions contemplated hereby.
k. No Investment Company. The Company is not, and upon the issuance and sale of the Securities as contemplated by this Agreement will not be an “investment company” required to be registered under the Investment Company Act of 1940 (an “Investment Company”). The Company is not controlled by an Investment Company.
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l. Breach of Representations and Warranties by the Company. If the Company breaches any of the material representations or warranties set forth in this Section 3 which is continuing after the applicable cure period as set forth in the Note, if any, and in addition to any other remedies available to the Buyer pursuant to this Agreement, it will be considered an Event of default under Section 4.4 of the Note.
4. COVENANTS.
a. Best Efforts. The Company shall use its reasonable commercial efforts to satisfy timely each of the conditions described in Section 7 of this Agreement.
b. Use of Proceeds. The Company shall use the proceeds for general working capital purposes.
c. Expenses. At the Closing, the Company’s obligation with respect to the transactions contemplated by this Agreement is to reimburse Buyer’ expenses shall be $5,500.00 for Buyer’s legal fees and due diligence fee.
d. Corporate Existence. So long as the Buyer beneficially owns any Note, the Company shall maintain its corporate existence and shall not sell all or substantially all of the Company’s assets, except with the prior written consent of the Buyer.
e. Breach of Covenants. If the Company breaches any of the material covenants set forth in this Section 4, and in addition to any other remedies available to the Buyer pursuant to this Agreement which is continuing after the applicable cure period as set forth in the Note, it will be considered an event of default under Section 4.4 of the Note.
f. Failure to Comply with the 1934 Act. So long as the Buyer beneficially owns the Note, the Company shall comply with the reporting requirements of the 1934 Act; and the Company shall continue to be subject to the reporting requirements of the 1934 Act.
g. The Buyer is Not a “Dealer”. The Buyer and the Company hereby acknowledge and agree that the Buyer has not: (i) acted as an underwriter; (ii) acted as a market maker or specialist; (iii) acted as “de facto” market maker; or (iv) conducted any other professional market activities such as providing investment advice, extending credit and lending securities in connection; and thus that the Buyer is not a “Dealer” as such term is defined in the 1934 Act.
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5. Transfer Agent Instructions. The Company shall issue irrevocable instructions to its transfer agent to issue certificates, registered in the name of the Buyer or its nominee, for the shares underlying any conversion of the Note upon default of the Note (the “Conversion Shares”) in such amounts as specified from time to time by the Buyer to the Company upon conversion of the Note in accordance with the terms thereof (the “Irrevocable Transfer Agent Instructions”). In the event that the Company proposes to replace its transfer agent, the Company shall provide, prior to the effective date of such replacement, a fully executed Irrevocable Transfer Agent Instructions in a form as initially delivered pursuant to this Agreement (including but not limited to the provision to irrevocably reserve shares of Common Stock in the Reserved Amount as such term is defined in the Note) signed by the successor transfer agent to Company and the Company. Prior to registration of the Conversion Shares under the 1933 Act or the date on which the Conversion Shares may be sold pursuant to an exemption from registration, all such certificates shall bear the restrictive legend specified in Section 2(e) of this Agreement. The Company warrants that: (i) no instruction other than the Irrevocable Transfer Agent Instructions referred to in this Section 5, will be given by the Company to its transfer agent and that the Securities shall otherwise be freely transferable on the books and records of the Company as and to the extent provided in this Agreement and the Note; (ii) it will not direct its transfer agent not to transfer or delay, impair, and/or hinder its transfer agent in transferring (or issuing)(electronically or in certificated form) any certificate for Conversion Shares to be issued to the Buyer upon conversion of or otherwise pursuant to the Note as and when required by the Note and this Agreement; and (iii) it will not fail to remove (or directs its transfer agent not to remove or impairs, delays, and/or hinders its transfer agent from removing) any restrictive legend (or to withdraw any stop transfer instructions in respect thereof) on any certificate for any Conversion Shares issued to the Buyer upon conversion of or otherwise pursuant to the Note as and when required by the Note and/or this Agreement. If the Buyer provides the Company and the Company’s transfer, at the cost of the Buyer, with an opinion of counsel in form, substance and scope customary for opinions in comparable transactions, to the effect that a public sale or transfer of such Securities may be made without registration under the 1933 Act, the Company shall permit the transfer, and, in the case of the Conversion Shares, promptly instruct its transfer agent to issue one or more certificates, free from restrictive legend, in such name and in such denominations as specified by the Buyer. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Buyer, by vitiating the intent and purpose of the transactions contemplated hereby. Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations under this Section 5 may be inadequate and agrees, in the event of a breach or threatened breach by the Company of the provisions of this Section, that the Buyer shall be entitled, in addition to all other available remedies, to an injunction restraining any breach and requiring immediate transfer, without the necessity of showing economic loss and without any bond or other security being required.
6. Conditions to the Company’s Obligation to Sell. The obligation of the Company hereunder to issue and sell the Securities to the Buyer at the Closing is subject to the satisfaction, at or before the Closing Date of each of the following conditions thereto, provided that these conditions are for the Company’s sole benefit and may be waived by the Company at any time in its sole discretion:
a. The Buyer shall have executed this Agreement and delivered the same to the Company.
b. The Buyer shall have delivered the Purchase Price in accordance with Section 1(b) above.
c. The representations and warranties of the Buyer shall be true and correct in all material respects as of the date when made and as of the Closing Date as though made at that time (except for representations and warranties that speak as of a specific date), and the Buyer shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Buyer at or prior to the Closing Date.
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d. No litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.
7. Conditions to The Buyer’s Obligation to Purchase. The obligation of the Buyer hereunder to purchase the Securities at the Closing is subject to the satisfaction, at or before the Closing Date of each of the following conditions, provided that these conditions are for the Buyer’s sole benefit and may be waived by the Buyer at any time in its sole discretion:
a. The Company shall have executed this Agreement and delivered the same to the Buyer.
b. The Company shall have delivered to the Buyer the duly executed Note, in accordance with Section 1(b) above.
c. The Irrevocable Transfer Agent Instructions, in form and substance satisfactory to the Buyer, shall have been delivered to and acknowledged in writing by the Company’s Transfer Agent.
d. The representations and warranties of the Company shall be true and correct in all material respects as of the date when made and as of the Closing Date as though made at such time (except for representations and warranties that speak as of a specific date) and the Company shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company at or prior to the Closing Date. The Buyer shall have received a certificate or certificates, executed by the chief executive officer of the Company, dated as of the Closing Date, to the foregoing effect and as to such other matters as may be reasonably requested by the Buyer including, but not limited to certificates with respect to the Board of Directors’ resolutions relating to the transactions contemplated hereby.
e. No litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.
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f. No event shall have occurred which could reasonably be expected to have a Material Adverse Effect on the Company including but not limited to a change in the 1934 Act reporting status of the Company or the failure of the Company to be timely in its 1934 Act reporting obligations.
8. Governing Law; Miscellaneous.
a. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Virginia without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Agreement shall be brought only in the Circuit Court of Fairfax County, Virginia or in the Alexandria Division of the United States District Court for the Eastern District of Virginia The parties to this Agreement hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. The Company and Buyer waive trial by jury. The Buyer shall be entitled to recover from the Company its reasonable attorney's fees and costs. In the event that any provision of this Agreement or any other agreement delivered in connection herewith is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of any agreement. Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this Agreement, the Note or any related document or agreement by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
b. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which shall constitute one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party.
c. Headings. The headings of this Agreement are for convenience of reference only and shall not form part of, or affect the interpretation of, this Agreement.
d. Severability. In the event that any provision of this Agreement is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any provision hereof which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision hereof.
e. Entire Agreement; Amendments. This Agreement and the instruments referenced herein contain the entire understanding of the parties with respect to the matters covered herein and therein and, except as specifically set forth herein or therein, neither the Company nor the Buyer makes any representation, warranty, covenant or undertaking with respect to such matters. No provision of this Agreement may be waived or amended other than by an instrument in writing signed by the majority in interest of the Buyer.
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f. Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by hand delivery, telegram, or facsimile, addressed as set forth below or to such other address as such party shall have specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery or delivery by facsimile, with accurate confirmation generated by the transmitting facsimile machine, at the address or number designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall be as set forth in the heading of this Agreement with a copy by fax only to (which copy shall not constitute notice) to Naidich Wurman LLP, 111 Great Neck Road, Suite 214, Great Neck, NY 11021, Attn: Allison Naidich, facsimile: 516-466-3555, e-mail: [email protected]. Each party shall provide notice to the other party of any change in address.
g. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns. Neither the Company nor the Buyer shall assign this Agreement or any rights or obligations hereunder without the prior written consent of the other. Notwithstanding the foregoing, the Buyer may assign its rights hereunder to any person that purchases Securities in a private transaction from the Buyer or to any of its “affiliates,” as that term is defined under the 1934 Act, without the consent of the Company.
h. Survival. The representations and warranties of the Company and the agreements and covenants set forth in this Agreement shall survive the closing hereunder notwithstanding any due diligence investigation conducted by or on behalf of the Buyer. The Company agrees to indemnify and hold harmless the Buyer and all their officers, directors, employees and agents for loss or damage arising as a result of or related to any breach or alleged breach by the Company of any of its representations, warranties and covenants set forth in this Agreement or any of its covenants and obligations under this Agreement, including advancement of expenses as they are incurred.
i. Further Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as the other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.
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j. No Strict Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction will be applied against any party.
k. Remedies. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Buyer by vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations under this Agreement will be inadequate and agrees, in the event of a breach or threatened breach by the Company of the provisions of this Agreement, that the Buyer shall be entitled, in addition to all other available remedies at law or in equity, and in addition to the penalties assessable herein, to an injunction or injunctions restraining, preventing or curing any breach of this Agreement and to enforce specifically the terms and provisions hereof, without the necessity of showing economic loss and without any bond or other security being required.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the undersigned Buyer and the Company have caused this Agreement to be duly executed as of the date first above written.
| ConnectM Technology Solutions, Inc. | ||
| By: | /s/ Bhaskar Panigrahi | |
| Bhaskar Panigrahi | ||
| Chief Executive Officer | ||
| Vanquish Funding Group Inc. | ||
| By: | ||
| Curt Kramer | ||
| President | ||
| Aggregate Principal Amount of Note: | $ | 160,160.00 | ||
| Original Issue Discount | $ | 17,160.00 | ||
| Aggregate Purchase Price: | $ | 143,000.00 |
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CORPORATE RESOLUTION OF THE BOARD OF DIRECTORS
OF
CONNECTM TECHNOLOGY SOLUTIONS, INC.
I, the undersigned, do hereby certify that at a meeting of the Board of Directors of ConnectM Technology Solutions, Inc., a corporation organized under the laws of the State of Delaware (the “Corporation”), duly held on October 7, 2025 at , the following resolution, upon motions made, seconded and carried, was duly adopted and is now in full force and effect:
WHEREAS, the Board of Directors of the Corporation deem it in the best interests of the Corporation to enter into the Securities Purchase Agreement dated October 7, 2025 (the “Agreement”) with Vanquish Funding Group Inc., in connection with the issuance of a note of the Corporation, in the aggregate principal amount of $160,160.00 (the “Note”), convertible into shares of common stock solely in the event of default, $0.0001 par value per share, of the Company (the “Common Stock”), upon the terms and subject to the limitations and conditions set forth in such Note, along with an irrevocable letter agreement with Continental Stock Transfer & Trust Co., the Corporation’s transfer agent, with respect to the reserve of shares of common stock of the Corporation to be issued upon any conversion of the Note; the issuance of such shares of common stock in connection with a conversion of the Note; and the indemnification of Continental Stock Transfer & Trust Co. for all loss, liability, or expense in carrying out the authority and direction contained in the irrevocable letter agreement (the “Letter Agreement”);
NOW, THEREFORE, BE IT:
RESOLVED, that the Corporation is hereby authorized to enter into the Agreement, the Note and the Letter Agreement which provides in pertinent part: (i) reserve shares of common stock of the Corporation to be issued upon any conversion of the Note; (ii) issue such shares of common stock in connection with a conversion of the Note (issuance upon receipt of a notice of conversion of the holder of the Note) without any further action or confirmation by the Corporation; and the Corporation indemnifies Continental Stock Transfer & Trust Co. for all loss, liability, or expense in carrying out the authority and direction contained in the Letter Agreement:
RESOLVED, that any executive officer of the Corporation be, and hereby is, authorized, empowered and directed, from time to time, to take such additional action and to execute, certify and deliver to the transfer agent of the Corporation, as any appropriate or proper to implement the provisions of the foregoing resolutions:
I, the undersigned, do hereby certify that I am a member of the Board of Directors of the Corporation; that the attached is a true and correct copy of resolutions duly adopted and ratified at a meeting of the Board of Directors of the Corporation duly convened and held in accordance with its bylaws and the laws of the State of Delaware, as transcribed by me from the minutes; and that the same have not in any way been modified, repealed or rescinded and are in full force and effect.
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IN WITNESS WHEREOF, I have hereunto set my hands as a member of the Board of Directors of the Corporation.
| Dated: October 7, 2025 | |
| /s/ Bhaskar Panigrahi | |
| Bhaskar Panigrahi | |
| Member of the Board |
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OFFICER'S CERTIFICATE
The undersigned, Bhaskar Panigrahi, Chief Executive Officer of ConnectM Technology Solutions, Inc., a Delaware Corporation (the "Company"), in connection with the authorization and issuance of the Promissory Note of the Company in the amount of $160,160.00 in accordance with the Securities Purchase Agreement dated October 7, 2025 by and among the Company and Vanquish Funding Group Inc. (the "Purchase Agreement" terms not otherwise defined herein shall have the meaning ascribed to such terms in the Purchase Agreement), hereby certifies that:
1. I am the duly appointed Chief Executive Officer of the Company.
2. The representations and warranties made by the Company in Section 3 of the Purchase Agreement are true and correct in all material respects as of the date of this Officer's Certificate. The capitalization of the Company described in Section 3(c) of the Purchase Agreement has not changed as of the date hereof.
3. As of the date hereof, the Company has satisfied and duly performed all of the conditions and obligations specified in Section 7 of the Purchase Agreement to be satisfied on or prior to the Closing Date (as defined in the Purchase Agreement) or such conditions and obligations have been waived expressly in writing signed by the purchaser.
4. The Company has complied with or, if compliance prior to Closing (as defined in the Purchase Agreement) is not required, promptly following the Closing the Company will comply with, the filing requirements in respect of this transaction under (a) Regulation D under the Securities Act of 1933, as amended (the "1933 Act") (and applicable Blue Sky regulations) and (b) the Securities Exchange Act of 1934, as amended.
5. There has been no adverse change in the business, affairs, prospects, operations, properties, assets or condition of the Company since June 30, 2025, the date of the Company's most recent reviewed financial statements delivered to the Lender (as defined in the Purchase Agreement), other than losses and matters which would not, individually or in the aggregate, have a Material Adverse Effect (as defined in the Purchase Agreement).
6. The Company is qualified as a foreign corporation in all jurisdictions in which the Company owns or leases properties, or conducts any business except where failure of the Company to be so qualified would not have a Material Adverse Effect (as defined in the Purchase Agreement).
IN WITNESS WHEREOF, the undersigned has executed this Officer's Certificate as of October 7, 2025.
| /s/ Bhaskar Panigrahi | |
| Bhaskar Panigrahi | |
| Chief Executive Officer |
ConnectM Technology Solutions, Inc.
October 7, 2025
Continental StockTransfer & Trust Co.
1 State Street Plaza, 30th Floor
New York, NY 10004
Ladies and Gentlemen:
ConnectM Technology Solutions, Inc., a Delaware corporation (the "Company") and Vanquish Funding Group Inc., a Virginia corporation (the "Lender") have entered into a Securities Purchase Agreement dated as of October 7, 2025 (the "Agreement") providing for the issuance of the Promissory Note in the principal amount of $160,160.00 (the "Note") which is convertible into common stock of the Company (“Common Stock”).
You are hereby irrevocably authorized and instructed to reserve a sufficient number of shares of Common Stock of the Company (initially, 3,950,000 shares) for issuance upon full conversion of the Note in accordance with the terms thereof. The amount of Common Stock so reserved may be increased, from time to time, upon the written instructions of the Company.
The ability to convert the Note in a timely manner is a material obligation of the Company pursuant to the Note. Provided you are acting as Transfer Agent at the time and provided no single issuance is greater than 4.99% of the issued and outstanding Common Stock of the Company, your firm is hereby irrevocably authorized and instructed to within two (2) Trading days issue shares of Common Stock of the Company to the Lender upon your receipt from the Lender of: (i) a notice of conversion (“Conversion Notice”) executed by the Lender with a copy concurrently delivered to the company, (ii) an opinion of the company’s counsel or counsel of the Lender, confirming that the Common Stock may be issued upon conversion of the Note without any transfer restrictions pursuant to an effective resale Registration Statement or pursuant to the exemption provided by Rule 144 (or any other available exemption) under the Federal Securities Act of 1933, as amended (the “Securities Act”), and (iii) copies of all supporting prospectus or Rule 144 documentation (a seller’s representation letter and a broker’s representation letter if the Common Stock has been held less than twelve months). Common Stock underlying each Conversion Notice should be issued, at the option of the Lender as specified in the Conversion Notice either (i) electronically by crediting the account of a Prime Broker with the Depository Trust Company through its Deposit Withdrawal at Custodian (“DWAC”) system provided the Lender causes its broker or bank to initiate a DWAC deposit or (ii) in certificated form without any restrictive legend which would restrict the transfer of the Common Stock, provided however that if such shares are not able to be sold under Rule 144 or any other exemption under the Securities Act and you have received an opinion from the Company’s or Lender’s counsel that the issuance of the Common Stock is exempt from registration under the Securities Act and when issued the Common Stock will be fully paid and non-assessable, then the issued certificates for such shares shall bear the following restrictive legend:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE SECURITIES MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER SAID ACT, OR AN OPINION OF COUNSEL IN FORM, SUBSTANCE AND SCOPE CUSTOMARY FOR OPINIONS OF COUNSEL IN COMPARABLE TRANSACTIONS, THAT REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT.
The Common Stock shall remain in the created reserve with the Transfer Agent until counsel to the Lender and an authorized officer of the Company provides joint written instructions to the Transfer Agent that the Common Stock or any part of them shall be taken out of the reserve and shall no longer be subject to the terms of these instructions.
The Company shall indemnify you and your officers, directors, principals, partners, agents and representatives, and hold each of them harmless from and against any and all loss, liability, damage, claim or expense (including the reasonable fees and disbursements of its attorneys) incurred by or asserted against you or any of them arising out of or in connection with the instructions set forth herein, the performance of your duties hereunder and otherwise in respect hereof, including the costs and expenses of defending yourself or themselves against any claim or liability including any claim which may be made or asserted by the Company, except that the Company shall not be liable hereunder as to matters in respect of which it is determined that you have acted with gross negligence or in bad faith. You shall have no liability to the Company and the Lender in respect of this if such action was taken or omitted to be taken in good faith, and you shall be entitled to rely in this regard and without liability on the advice of counsel, including counsel selected by you.
The Board of Directors of the Company has approved these irrevocable instructions and does hereby extend the Company’s irrevocable agreement to indemnify your firm for all loss, liability or expense in carrying out the authority and direction herein contained on the terms herein set forth.
The Company agrees that in the event that you resign as the Company’s transfer agent, the Company shall engage a suitable replacement transfer agent that will agree to serve as transfer agent for the Company within five (5) business days. The Company acknowledges that we will have the right to complete any issuance or conversion request received in good order prior to our resignation. It is also understood that you are permitted to resign without any stipulated conditions.
The Lender is intended to be and is a third party beneficiary hereof, and no amendment or modification to the instructions set forth herein may be made without the consent of the Lender.
Notwithstanding any other provision hereof, the Company and the Lender understand that you shall not be required to perform any issuance of the Common Stock if (a) such an issuance or transfer of Common Stock is in violation of any state or federal securities laws or regulations or (b) the issuance of the Common Stock is prohibited or stopped as required or directed by a court order from a court of competent jurisdiction. Additionally, Company and Lender understand that you shall not be required to perform any issuance of the Common Stock if Company is in default of its payment obligations under its agreement with you.
| Very truly yours, | |
| ConnectM Technology Solutions, Inc. | |
| /s/ Bhaskar Panigrahi | |
| Bhaskar Panigrahi | |
| Chief Executive Officer |
| Vanquish Funding Group Inc. | ||
| By: | /s/ Curt Kramer | |
| Curt Kramer | ||
| President | ||
| Acknowledged and Agreed: | ||
| Continental StockTransfer & Trust Co. | ||
| By: | ||
| Name: | ||
| Title: | ||
| Date: | ||
Exhibit 10.5
BUSINESS LOAN AND SECURITY AGREEMENT
SUPPLEMENT
This Business Loan and Security Agreement Supplement is part of (and incorporated by reference into) the Business Loan and Security Agreement. Borrower should keep this important legal document for Borrower’s records.
| Borrower: | BOURQUE HEATING & COOLING CO., INC. dba - Bourque Heating & Cooling |
| Lender: | FinWise Bank |
Existing Balance to be Paid Off:
Amount of Existing Balance owed to any third party lender or provider of funding, which will be paid as of the Effective Date of this Loan Agreement and will be deducted from your Disbursement Amount |
$0.00 |
Existing Balance to be Consolidated:
Amount of Existing Balance owed to Lender in respect of an existing loan, which Existing Balance WILL NOT be paid off, but the Principal Portion of which will be Consolidated with the New Funding Amount as of the Effective Date of this Loan Agreement as set forth in the Total Funding Amount |
$0.00 |
Principal Portion of Existing Consolidated Balance:
Amount of Principal in respect of the Existing Consolidated Balance, which includes any accrued but unpaid fees |
$0.00 |
Interest Portion of Existing Consolidated Balance:
Amount of Interest in respect of the Existing Consolidated Balance |
$0.00 |
| New Funding Amount: | $250,000.00 |
Total Funding Amount:
The sum of the Principal Portion of Existing Consolidated Balance (if any) and the New Funding Amount |
$250,000.00 |
| Origination Fee | $10,000.00 |
Interest Charge in respect of the Total Funding Amount:
Dollar amount of interest that the Total Funding Amount will cost (does not include any Fees) |
$82,500.00 |
Total Repayment Amount:
Sum of Total Funding Amount and Interest Charge in Respect of the Total Funding Amount, when all payments are made on time |
$332,500.00 |
| Payment Schedule and Term: | 63.0 payments of $ 5,277.80 due each Business Week beginning on the first business day after the Disbursement Amount is disbursed. (collectively, the Weekly Repayment Amount”) “Business day” means any Monday through Friday, except for Federal Reserve holidays, and “Business Week” has a corresponding meaning. |
Disbursement Amount:
New Funding Amount less the Existing Paid Off Balance (if any), less the Origination Fee |
$240,000.00 |
Simple Interest Rate on Total Funding Amount:
(Interest rate paid on Amount of Loan if all payments made as scheduled. This Interest Rate is not an annualized interest rate) |
33.0% |
| Fees: | Returned Payment Fee: $25.00 |
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| Prepayment Discount Percentage: | A “Prepayment Discount Percentage” of 100% of the unpaid interest portion of the full balance then remaining on the Loan will apply with respect to this Loan to the extent that the Borrower prepays this Loan in whole in accordance with, and subject to, Section 10 of the Business Loan and Security Agreement. |
Interest Rate
The simple interest rate disclosed on this Business Loan and Security Agreement Supplement (the “Interest Rate”) is the rate of interest calculated by dividing the Amount of the New Funding Amount by the Interest Charge in respect of the New Funding Amount. This calculation assumes that all payments are made as scheduled. THIS SIMPLE INTEREST RATE DOES NOT INCLUDE ANY FEES AND IS NOT ANNUALIZED AND, THEREFORE, IS NOT AN ANNUAL PERCENTAGE RATE (“APR”).
The APR equals a single percentage number that represents the actual yearly cost of funds over the term of a loan and includes any fees or additional costs associated with the loan. The APR on this loan can be compared to the APR of other loan programs to give you a consistent means of comparing rates and programs to the extent programs have different loan terms and fee structures.
Attached to this Business Loan and Security Agreement Supplement is a SMART Box™ Capital Comparison Tool, which is provided to help you understand and assess the cost of your small business financing in a variety of different ways, in order to assist that understanding as fully as possible.
Loan Pricing Disclosure
Lender uses a system of risk-based pricing to determine Loan amounts, interest charges and fees. Risk-based pricing is a system that evaluates the risk factors of your application and adjusts the amount of the Loan, its term and the interest rate and discounts points up or down based on this risk evaluation.
Although Lender believes that its loan process provides expedited turnaround time and its underwriting process provides greater likelihood of approval of your loan, this loan may be a higher cost loan than loans that may be available through other lenders. You should fully consider all costs and fees associated with this loan and compare your available alternatives to this loan. You are encouraged to engage appropriate advisors to the extent you believe necessary to evaluate the terms of this loan.
ELECTRONIC SIGNATURE
Borrower and each Guarantor (as defined in the Business Loan and Security Agreement below) agree that any electronic signature provided to Lender in connection with the Business Loan and Security Agreement Supplement, the Business Loan and Security Agreement,, the Authorization Agreement for Direct Deposit (ACH Credit) and Direct Payments (ACH Debits), and any other agreement between the parties related to the subject matter contained therein shall have the same force and effect as a manual signature. As used herein, the term “electronic signature” means any electronic sound, symbol or process attached to or logically associated with a record and executed and adopted by a person or entity with the intent to sign such record on behalf of Borrower or Guarantor (as applicable).
LOAN FOR SPECIFIC PURPOSES ONLY
The proceeds of the requested Loan may solely be used for the specific purposes as set forth in the Use of Proceeds Certification of the Business Loan and Security Agreement. IN ADDITION, THE LOAN WILL NOT BE USED FOR PERSONAL, FAMILY OR HOUSEHOLD PURPOSES. Borrower understands that Borrower’s agreement not to use the Loan proceeds for personal, family or household purposes means that certain important duties imposed upon entities making loans for consumer/personal purposes, and certain important rights conferred upon consumers, pursuant to Federal or State law will not apply to this transaction.
CERTIFICATION RELATED TO BORROWER’S OWNERSHIP
If Borrower has an Existing Consolidated Balance owed to the Lender or Existing Paid Off Balance owed to a third party (each as defined above), by signing below, Borrower certifies and confirms that there have been no changes to its beneficial ownership since the initial funding related to the Existing Balance in question.
Please sign this document here:
| /s/ Mahesh Choudhury | |
| MAHESH CHOUDHURY |
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AUTHORIZATION AGREEMENT FOR
DIRECT DEPOSIT (ACH CREDIT) AND
DIRECT PAYMENTS (ACH DEBITS)
This Authorization Agreement for Direct Deposit (ACH Credit) and Direct Payments (ACH Debits) is part of (and incorporated by reference into) the Business Loan and Security Agreement. Borrower should keep this important legal document for Borrower’s records.
DISBURSMENT OF LOAN PROCEEDS. By signing below, Borrower authorizes Lender to disburse the Loan proceeds less the amount of any applicable fees upon Loan approval by initiating an ACH credit, wire transfer or similar means to the checking account indicated below (or a substitute checking account Borrower later identifies and is acceptable to Lender) (hereinafter referred to as the “Designated Checking Account”) in the Disbursement Amount set forth in the accompanying Business Loan and Security Agreement Supplement. This authorization to credit Loan proceeds to Borrower’s Designated Checking Account is to remain in full force and effect until (a) Lender has received written notification from Borrower of its termination in such time and in such manner as to afford Lender and Borrower’s depository bank a reasonable opportunity to act on it, or (b) Borrower has satisfied all of its obligations set forth in the Business Loan and Security Agreement.
AUTOMATIC PAYMENT PLAN. Enrollment in Lender’s Automatic Payment Plan, by signature of this Authorization Agreement, is required for Loan approval. By signing below, Borrower agrees to enroll in the Automatic Payment Plan and authorizes Lender to collect payments required under the terms of Borrower’s Business Loan and Security Agreement by initiating ACH debit entries to the Designated Checking Account in the amounts and on the dates provided in the Payment Schedule set forth in the accompanying Business Loan and Security Agreement Supplement. Borrower authorizes Lender to increase the amount of any scheduled ACH debit entry or assess multiple ACH debits for the amount of (i) any previously scheduled payment(s) that was not paid as provided in the payment schedule and (ii) any unpaid Fees. This authorization to debit Borrower’s Designated Checking Account is to remain in full force and effect until Lender has received written notification from Borrower of its termination in such time and in such manner as to afford Lender and Borrower’s depository bank a reasonable opportunity to act on it or Borrower has satisfied all of its obligations set forth in the Business Loan and Security Agreement. Lender may suspend or terminate Borrower’s enrollment in the Automatic Payment Plan immediately if Borrower fails to keep Borrower’s designated checking account in good standing or if there are insufficient funds in Borrower’s checking account to process any payment. If Borrower revokes the authorization or Lender suspends or terminates Borrower’s enrollment in the Automatic Payment Plan because of the inability to process debits to Borrower’s Designated Checking Account, Borrower will be in “Default” of the Business Loan and Security Agreement as such term is defined in Section 29 therein. Upon default, Borrower will remain responsible for making timely payments pursuant to the alternative payment methods described in the Business Loan and Security Agreement.
BUSINESS PURPOSE ACCOUNT. By signing below, Borrower attests that the Designated Checking Account was established for business purposes and not primarily for personal, family or household purposes.
ACCOUNT CHANGES. Borrower agrees to notify Lender promptly if there are any changes to the account and routing numbers of the Designated Checking Account.
MISCELLANEOUS. Lender is not responsible for any fees charged by Borrower’s bank as the result of credits or debits initiated under this agreement. The origination of ACH transactions to Borrower’s account must comply with the provisions of U.S. law.
| Depository Name: | CAPE COD 5 |
| Branch: |
| City: | State: | Zip: |
| Routing Number: | *****1078 | Account Number: | *****3322 |
| Print Business Account Holder Name: | MAHESH CHOUDHURY | Tax ID Number: | **-***6912 |
| Signature: | /s/ Mahesh Choudhury | Title: | Manager |
| Date: | 10/20/2025 |
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BUSINESS LOAN AND SECURITY AGREEMENT
SECTION 1. INTRODUCTION. This Business Loan and Security Agreement (“Agreement”) governs your business loan (“Loan”) from FinWise Bank. Please read it and keep it for your reference. In this Agreement, the words “you,” “your” and “Borrower” means each individual or entity that signs this Agreement or on whose behalf this Agreement is signed. The words “Lender,” “we,” “us”, and “our” mean FinWise Bank or its successor, assigns, agents, and servicers.
SECTION 2. EFFECTIVE DATE. This Agreement begins on the date we disburse the Disbursement Amount from Utah (the “Effective Date”). Borrower understands and agrees that Lender may postpone, without penalty, the disbursement of amounts to Borrower until (i) all required security interests have been perfected, (ii) Lender has completed its required diligence related to its “know your customer” obligations under federal law, (iii) Lender has received all required personal guarantees or other documentation; and (iv) Lender has reviewed all documents and information required in connection with underwriting the Loan and has approved the Loan for funding.
SECTION 3. AUTHORIZATION. Borrower agrees that the Loan made by Lender to Borrower shall be conclusively deemed to have been authorized by Borrower and to have been made pursuant to a duly authorized request on its behalf.
SECTION 4. LOAN FOR SPECIFIC PURPOSES ONLY. The proceeds of the requested Loan may solely be used for the specific purposes as set forth in the Use of Proceeds Certification contained in Section 49 below, and not for any other purpose, including personal, family or household purposes. Borrower and each Guarantor understands that Borrower’s agreement not to use the Loan proceeds for personal, family or household purposes means that certain important duties imposed upon entities making loans for consumer/personal purposes, and certain important rights conferred upon consumers, pursuant to federal or state law will not apply to the Loan or the Agreement. Borrower and each Guarantor also understand that Lender will be unable to confirm whether the use of the Loan conforms to this section. Borrower and each Guarantor agrees that a breach by Borrower of the provisions of this section will not affect Lender’s right to (i) enforce Borrower’s promise to pay for all amounts owed under this Agreement, regardless of the purpose for which the Loan is in fact obtained; or (ii) use any remedy legally available to Lender, even if that remedy would not have been available had the Loan been made for consumer purposes.
SECTION 5. DISBURSEMENT OF LOAN PROCEEDS AND MAINTENANCE OF BORROWER’S BANK ACCOUNT. If Borrower applied and is approved for a Loan, Borrower’s Loan will be disbursed, upon approval, as provided in the accompanying Authorization Agreement for Direct Deposit (ACH Credit) and Direct Payments (ACH Debits). Borrower agrees to maintain Direct Payments (ACH Debits) in its Designated Checking Account, which is the account that was reviewed in conjunction with underwriting and approval of this Loan (including keeping such account open until the Total Repayment Amount had been completely repaid. Any change to the Designated Checking Account must be approved in advance by Lender in its sole discretion.
SECTION 6. PROMISE TO PAY. Borrower agrees to pay Lender the Total Repayment Amount shown in the accompanying Business Loan and Security Agreement Supplement in accordance with the Payment Schedule shown in the Business Loan and Security Agreement Supplement. Borrower agrees to enroll in Lender’s Automatic Payment Plan and authorizes Lender to collect required payments as provided in the accompanying Authorization Agreement for Direct Deposit (ACH Credit) and Direct Payments (ACH Debits). Borrower attests that the Designated Checking Account was established by Borrower and the Loan proceeds will be used for business purposes only and not for personal, family, or household purposes.
SECTION 7. ALTERNATIVE PAYMENT METHODS. If Borrower knows that for any reason Lender will be unable to process a payment under Lender’s Automatic Payment Plan, then Borrower must either restore sufficient funds such that the missed payment can be collected as provided in the accompanying Authorization Agreement for Direct Deposit (ACH Credit) and Direct Payments (ACH Debits), provide funds in a manner approved by Lender which may include the acceptance of a check; or, if offered, make the missed payment by any pay-by-phone or on-line service that Lender may make available from time to time. All alternative payments must be made in good funds by check, money order, wire transfer, automatic transfer from an account at an institution offering such service, or other instrument in U.S. Dollars. Borrower understands and agrees that payments made at any other address than as specified by Lender may result in a delay in processing and/or crediting. If Borrower makes an alternative payment on Borrower’s Loan by any pay-by-phone or on-line service that Lender makes available while Borrower is enrolled in the Automatic Payment Plan, Lender may treat such payment as an additional payment and continue to process Borrower’s scheduled Automatic Payment Plan payments or may reduce any scheduled Automatic Payment Plan payment by the amount of any such additional payment received, in its sole discretion.
SECTION 8. APPLICATION OF PAYMENTS. Subject to applicable law, Lender reserves the right to apply payments to Borrower’s Loan in any manner Lender chooses in Lender’s sole discretion it being understood and agreed that any fees and interest will generally be paid during the earlier portion of the term.
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SECTION 9. POSTDATED CHECKS, RESTRICTED ENDORSEMENT CHECKS AND OTHER DISPUTED OR QUALIFIED PAYMENTS. Lender can accept late, postdated or partial payments without losing any of Lender’s rights under this Agreement (a postdated check is a check dated later than the day it was actually presented for payment). Lender is under no obligation to hold a postdated check and Lender reserves the right to process every item presented as if dated the same date received by Lender or Lender’s check processor unless Borrower gives Lender adequate notice and a reasonable opportunity to act on it. Except where such notice and opportunity is given, Borrower may not hold Lender liable for depositing any postdated check. Borrower agrees not to send Lender partial payments marked “paid in full,” “without recourse,” or similar language. If Borrower sends such a payment, Lender may accept it without losing any of Lender’s rights under this Agreement. All notices and written communications concerning postdated checks, restricted endorsement checks (including any check or other payment instrument that indicates that the payment constitutes “payment in full” of the amount owed or that is tendered with other conditions or limitations or as full satisfaction of a disputed amount) or any other disputed, nonconforming or qualified payments, must be mailed or delivered to Mulligan Funding, LLC, 4715 Viewridge Avenue, Suite 100, San Diego, CA 92123, Attn: Accounting Dept.
SECTION 10. PREPAYMENT. Borrower may prepay Borrower’s Loan in whole on any Business Day by paying Lender the sum total of the Total Repayment Amount, and any Returned Payment Fees, in each case as described in the accompanying Business Loan and Security Agreement Supplement less (i) any Loan payments made prior to such prepayment; and (ii) the product of (X) the percentage identified as the applicable Prepayment Discount Percentage in the accompanying Business Loan and Security Agreement Supplement; and (Y) the aggregate amount interest remaining on the Borrower’s Loan as of such date as determined by Lender’s records in accordance with Section 8, provided however that (a) at the time of the prepayment in question, Borrower’s account is current and in good standing, and Borrower is not in breach of any of the terms of The Agreement; (b) this discount shall only be applicable if the payment in question is made directly from the Designated Checking Account, and not from the account of any other lender which is a competitor of the Lender's; (c) the payment is not effectively funded by the receipt by the Borrower of a loan or advance provided by a direct competitor of the Lender’s. Borrower may prepay Borrower’s Loan in part on any Business Day and such payment shall be applied against the Total Repayment Amount, and any Returned Payment Fees, in each case as described in the accompanying Borrower’s Business Loan and Security Agreement Supplement.
SECTION 11. SECURITY INTEREST. Borrower and/or Guarantor hereby grants to Lender, the secured party hereunder, a continuing security interest in and to any and all “Collateral” as described below to secure payment and performance of all debts, liabilities and obligations of Borrower to Lender hereunder and also any and all other debts, liabilities and obligations of Borrower to Lender of every kind and description, direct or indirect, absolute or contingent, primary or secondary, due or to become due, now existing or hereafter arising, whether or not such obligations are related to the Loan described in this Agreement, by class, or kind, or whether or not contemplated by the parties at the time of the granting of this security interest, regardless of how they arise or by what agreement or instrument they may be evidenced or whether evidenced by any agreement or instrument, and includes obligations to perform acts and refrain from taking action as well as obligations to pay money including, without limitation, all interest, other fees and expenses (all hereinafter called “Obligations”). The Collateral includes the following property that Borrower (or Guarantor, if applicable pursuant to Section 12) now owns or shall acquire or create immediately upon the acquisition or creation thereof: (i) any and all amounts owing to Borrower now or in the future from any merchant processor(s) processing charges made by customers to Borrower via credit card or debit card transactions; and (ii) all other tangible and intangible personal property, including, but not limited to (a) cash and cash equivalents, (b) inventory, (c) equipment, (d) investment property, including certificated and uncertificated securities, securities accounts, security entitlements, commodity contracts and commodity accounts, (e) instruments, including promissory notes (f) chattel paper, including tangible chattel paper and electronic chattel paper, (g) documents, (h) letter of credit rights, (i) accounts, including accounts receivables, (j) deposit accounts, (k) commercial tort claims, (l) general intangibles, including payment intangibles and software and (m) as-extracted collateral as such terms may from time to time be defined in the Uniform Commercial Code. The security interest Borrower (or Guarantor, if applicable, pursuant to Section 12) grants includes all accessions, attachments, accessories, parts, supplies and replacements for the Collateral, all products, proceeds and collections thereof and all records and data relating thereto. Lender disclaims any security interest in household goods in which Lender is forbidden by law from taking a security interest.
SECTION 12. PROTECTING THE SECURITY INTEREST. Borrower and each Guarantor agrees that Lender and/or Lender’s Representative may file any financing statement, lien entry form or other document Lender and/or Lender’s Representative requires in order to perfect, amend or continue Lender’s security interest in the Collateral and Borrower and each Guarantor agrees to cooperate with Lender and Lender’s Representative as may be necessary to accomplish said filing and to do whatever Lender or Lender’s Representative deems necessary to protect Lender’s security interest in the Collateral. Borrower and each Guarantor agree that, if any Guarantor is a corporate entity, then Lender or Lender’s Representative may file any financing statement, lien entry form or other document against such Guarantor or its property that Lender and/or Lender’s Representative requires in order to perfect, amend or continue Lender’s security interest in the Collateral. Any such Guarantor agrees to cooperate with Lender and Lender’s Representative as may be necessary to accomplish said filing and to do whatever Lender and Lender’s Representative deems necessary to protect Lender’s security interest in the Collateral. In this Agreement, “Lender’s Representative” means any entity or individual that is designated by Lender to serve in such capacity.
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SECTION 13. LOCATION OF COLLATERAL; TRANSACTIONS INVOLVING COLLATERAL. Unless Lender has agreed otherwise in writing, Borrower agrees and warrants that (i) all Collateral (or records of the Collateral in the case of accounts, chattel paper and general intangibles) shall be located at Borrower’s address as shown in the application; (ii) except for inventory sold or accounts collected in the ordinary course of Borrower’s business, Borrower shall not sell, offer to sell, or otherwise transfer or dispose of the Collateral; (iii) no one else has any interest in or claim against the Collateral that Borrower has not already disclosed to Lender in writing prior to the Effective Date; (iv) Borrower shall not pledge, mortgage, encumber or otherwise permit the Collateral to be subject to any lien, security interest, encumbrance or charge, other than the security interest provided for in this Agreement without written consent of Lender; and (v) Borrower shall not sell, offer to sell, or otherwise transfer or dispose of the Collateral for less than the fair market value thereof. Borrower shall defend Lender’s rights in the Collateral against the claims and demands of all other persons. All proceeds from any unauthorized disposition of the Collateral shall be held in trust for Lender, shall not be co-mingled with any other funds and shall immediately be delivered to Lender. This requirement, however, does not constitute consent by Lender to any such disposition.
SECTION 14. TAXES, ASSESSMENTS AND LIENS. Borrower will complete and file all necessary federal, state and local tax returns and will pay when due all taxes, assessments, levies and liens upon the Collateral. Borrower shall provide evidence of such payments to Lender upon request.
SECTION 15. INSURANCE. Borrower shall procure and maintain such insurance as Lender may require with respect to its Collateral, real property, commercial liability, fire, theft, and other risks, in form, amounts and coverage reasonably acceptable to Lender and issued by a company reasonably acceptable to Lender naming Lender as loss payee. If Borrower at any time fails to obtain or maintain any insurance as required under this Agreement, Lender may at its option obtain such insurance as Lender deems appropriate at Borrower’s sole cost and expense. Borrower shall promptly notify Lender of any loss of or damage to the Collateral. Lender is under no obligation to purchase any particular type of amount of coverage. Borrower and each Guarantor acknowledge that the cost of any insurance coverage so obtained might significantly exceed the cost of insurance that Borrower could have obtained.
SECTION 16. REPAIRS AND MAINTENANCE. Borrower and each Guarantor agree to keep and maintain, and to cause others to keep and maintain, the Collateral in good order, repair and condition at all times while this Agreement remains in effect. Borrower further agrees to pay when due all claims for work done on, or services rendered or material furnished in connection with the Collateral so that no lien or encumbrance may ever attach to or be filed against the Collateral.
SECTION 17. INSPECTION OF COLLATERAL AND PLACE OF BUSINESS; USE OF PHOTOGRAPHS AND TESTIMONIALS. Lender and Lender’s designated representatives and agents shall have the right during Borrower’s normal business hours and at any other reasonable time to examine the Collateral wherever located and the interior and exterior of any Borrower’s place of business. During an examination of any Borrower’s place of business, Lender may examine, among other things, whether Borrower (i) has a place of business that is operational and separate from any personal residence; (ii) is open for business; (iii) has sufficient inventory to conduct Borrower’s business; or (iv) has one or more credit card terminals if Borrower processes credit card transactions. When performing an examination, Lender may photograph the interior and exterior of any Borrower place of business, including any signage, and may photograph any individual who has signed the Agreement (“Signatory”) unless the Signatory previously has notified Lender that he or she does not authorize Lender to photograph the Signatory. Lender may obtain testimonials from any Signatory, including testimonials on why Borrower needed the Loan and how the Loan has helped Borrower. Any photograph and testimonial will become and remain the sole property of Lender. Borrower and each Signatory grant Lender the irrevocable and permanent right to display and share any photograph and testimonial in all forms and media, including composite and modified representations, for all purposes, including but not limited to any trade or commercial purpose, with any Lender employees and agents and with the general public. Lender may, but is not required to, use the name of any Borrower and Signatory as a credit in connection with any photograph and testimonial. Borrower and each Signatory waive the right to inspect or approve versions of any photograph or testimonial or the written copy or other media that may be used in connection with same. Borrower and each Signatory release Lender from any claims that may arise regarding the use of any photograph or testimonial, including any claims of defamation, invasion of privacy or infringement of moral rights, rights of publicity or copyright.
SECTION 18. LENDER’S EXPENDITURES. If any action or proceeding is commenced that would materially affect Lender’s interest in the Collateral as described above and in the Personal Guaranty set forth in Section 48 (if applicable), or if Borrower fails to comply with any provision of this Agreement or any related documents, including but not limited to Borrower’s failure to discharge or pay when due any amounts Borrower is required to discharge or pay under this Agreement or any related documents, Lender on Borrower’s behalf may (but shall not be obligated to) take any action that Lender deems appropriate, including but not limited to discharging or paying all taxes, liens, security interest, encumbrances and other claims, at any time levied or placed on the Collateral and paying all costs for insuring, maintaining and preserving the Collateral. To the extent permitted by applicable law, all such expenses will become a part of the Obligations and, at Lender’s option, will: (i) be payable on demand; (ii) be added to the balance of the Loan and be apportioned among and be payable with any installment payments to become due during the remaining term of the Loan; or (iii) be treated as a balloon payment that will be due and payable at the Loan’s maturity. Such right shall be in addition to all other rights and remedies to which Lender may be entitled upon an Event of Default as described in Section 29.
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SECTION 19. BORROWER’S REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants that: (i) Borrower will comply with all laws, statutes, regulations and ordinances pertaining to the conduct of Borrower’s business and promises to hold Lender harmless from any damages, liabilities, costs, expenses (including attorneys’ fees) or other harm arising out of any violation thereof; (ii) Borrower’s principal executive office and the office where Borrower keeps its records concerning its accounts, contract rights and other property, is that shown in the application; (iii) Borrower is duly organized, licensed, validly existing and in good standing under the laws of its state of formation and shall hereafter remain in good standing in that state, and is duly qualified, licensed and in good standing in every other state in which it is doing business, and shall hereafter remain duly qualified, licensed and in good standing in every other state in which it is doing business, and shall hereafter remain duly qualified, licensed and in good standing in every other state in which the failure to qualify or become licensed could have a material adverse effect on the financial condition, business or operations of Borrower; (iv) the exact legal name of the Borrower is set forth in the application; (v) the aggregate ownership percentage of the Signatories is greater than or equal to fifty percent (50%) of the Borrower’s business; (vi) the execution, delivery and performance of this Agreement, and any other document executed in connection herewith, are within Borrower’s powers, have been duly authorized, are not in contravention of law or the terms of Borrower’s charter, by-laws or other organization papers, or of any indenture, agreement or undertaking to which Borrower is a party; (vii) all organization papers and all amendments thereto of Borrower have been duly filed and are in proper order and any capital stock issued by Borrower and outstanding was and is properly issued and all books and records of Borrower are accurate and up to date and will be so maintained; (viii) Borrower (a) is subject to no charter, corporate or other legal restriction, or any judgment, award, decree, order, governmental rule or regulation or contractual restriction that could have a material adverse effect on its financial condition, business or prospects, and (b) is in compliance with its organization documents and by-laws, all contractual requirements by which it may be bound and all applicable laws, rules and regulations other than laws, rules or regulations the validity or applicability of which it is contesting in good faith or provisions of any of the foregoing the failure to comply with which cannot reasonably be expected to materially adversely affect its financial condition, business or prospects, the value of the Collateral or the value of the Personal Guaranty; and (ix) there is no action, suit, proceeding or investigation pending or, to Borrower’s knowledge, threatened against or affecting it or any of its assets before or by any court or other governmental authority, which, if determined adversely to it, would have a material adverse effect on its financial condition, business or prospects or the value of the Collateral or Personal Guaranty.
SECTION 20. INTEREST AND FEES. Borrower agrees to pay the Interest Charges in full as set forth in the accompanying Business Loan and Security Agreement Supplement. In addition to any other fees described in the Agreement, Borrower agrees to pay the following fees:
A. Origination Fee: A one-time Origination Fee in the amount set forth in the accompanying Business Loan and Security Agreement Supplement. Borrower agrees that this fee will be immediately deducted from the proceeds of Borrower’s Loan.
B. Returned Payment Fee: A Returned Payment Fee in the amount set forth in the accompanying Business Loan and Security Agreement Supplement if any payment processed on Borrower’s Loan is returned unpaid or dishonored for any reason.
Payments made by Borrower will be applied towards Loan interest and principal, interest and fees in the manner set forth in Section 8.
SECTION 21. INTEREST AND FEES EXCEEDING PERMITTED LIMIT. If the Loan is subject to a law that sets maximum charges, and that law is finally interpreted so that the interest or other fees collected or to be collected in connection with this Agreement exceed the permitted limits, then (i) any such charge will be reduced by the amount necessary to reduce the charge to the permitted limit; and (ii) if required by any law, any sums already collected from Borrower that exceed the permitted limits will be refunded or credited to Borrower.
SECTION 22. FINANCIAL INFORMATION AND REEVALUATION OF CREDIT. Borrower and each Guarantor (if any) authorize Lender to obtain business and personal credit bureau reports in Borrower’s and any Guarantor’s name, respectively, at any time and from time to time for purposes of deciding whether to approve the requested Loan or for any update, renewal, extension of credit or other lawful purpose. Upon Borrower’s or any Guarantor’s request, Lender will advise Borrower or Guarantor if Lender obtained a credit report and Lender will give Borrower or Guarantor the credit bureau’s name and address. Borrower and each Guarantor (if any) agree to submit current financial information, a new credit application, or both, in Borrower’s name and in the name of each Guarantor, respectively, at any time promptly upon Lender’s request. Borrower authorizes Lender to act as Borrower’s agent for purposes of accessing and retrieving transaction history information regarding Borrower from any lender to Borrower, or other entity with which Borrower has a contract for the payment of funds borrowed or advanced. Lender may report Lender’s credit experiences with Borrower and any Guarantor of Borrower’s Loan to third parties as permitted by law. Borrower also agrees that Lender may release information to comply with governmental reporting or legal process that Lender believes may be required, whether or not such is in fact required, or when necessary or helpful in completing a transaction, or when investigating a loss or potential loss. Borrower and each Guarantor is hereby notified that a negative credit report reflecting on Borrower and/or Guarantor’s credit record may be submitted to a credit reporting agency if Borrower or such Guarantor fails to fulfill the terms of their respective credit obligations hereunder.
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SECTION 23. ATTORNEYS’ FEES AND COLLECTION COSTS. To the extent not prohibited by applicable law, Borrower shall pay to Lender on demand any and all expenses, including, but not limited to, collection costs, all attorneys’ fees and expenses, and all other expenses of like or unlike nature which may be expended by Lender to obtain or enforce payment of Obligations either as against Borrower or any Guarantor or surety of Borrower or in the prosecution or defense of any action or concerning any matter growing out of or connected with the subject matter of this Agreement, the Obligations, or the Collateral, or any of Lender’s rights or interests therein or thereto, including, without limiting the generality of the foregoing, any counsel fees or expenses incurred in any bankruptcy or insolvency proceedings and all costs and expenses (including search fees) incurred or paid by Lender in connection with the administration, supervision, protection or realization on any security held by Lender for the debt secured hereby, whether such security was granted by Borrower or by any other person primarily or secondarily liable (with or without recourse) with respect to such debt, and all costs and expenses incurred by Lender in connection with the defense, settlement or satisfaction of any action, claim or demand asserted against Lender in connection therewith, which amounts shall be considered advances to protect Lender’s security, and shall be secured hereby. To the extent permitted by applicable law, all such expenses will become a part of the Obligations and, at Lender’s option, will: (i) be payable on demand; (ii) be added to the balance of the Loan and be apportioned among and be payable with any installment payments to become due during the remaining term of the Loan; or (iii) be treated as a balloon payment that will be due and payable at the Loan’s maturity. Such right shall be in addition to all other rights and remedies to which Lender may be entitled upon an Event of Default.
SECTION 24. BORROWER’S REPORTS. Promptly upon Lender’s written request, Borrower and each Guarantor agree to provide Lender with such information about the financial condition and operations of Borrower or any Guarantor, as Lender may, from time to time, reasonably request. Borrower also agrees promptly upon becoming aware of any Event of Default as described in Section 29, or the occurrence or existence of an event which, with the passage of time or the giving of notice or both, would constitute an Event of Default hereunder, to promptly provide notice thereof to Lender in writing.
SECTION 25. TELEPHONE COMMUNICATIONS. Borrower hereby expressly consents to receiving calls and messages related to the Loan or this Agreement, including auto-dialed and pre-recorded message calls and SMS messages (including text messages) from Lender, its affiliates, agents and others calling at Lender’s request or on its behalf, at any telephone numbers that Borrower has provided or may provide in the future or otherwise in Lender’s possession (including any cellular or mobile telephone numbers).
SECTION 26. INDEMNIFICATION. Except for Lender’s gross negligence or willful misconduct, Borrower will indemnify and save Lender harmless from all loss, costs, damage, liability or expenses (including, without limitation, court costs and reasonable attorneys’ fees) that Lender may sustain or incur by reason of defending or protecting Lender’s security interest or the priority thereof or enforcing the Obligations, or in the prosecution or defense of any action or proceeding concerning any matter growing out of or in connection with this Agreement and/or any other documents now or hereafter executed in connection with this Agreement and/or the Obligations and/or the Collateral. This indemnity shall survive the repayment of the Obligations and the termination of this Agreement.
SECTION 27. MERGERS, CONSOLIDATIONS OR SALES. Borrower represents and agrees that Borrower will not, without Lender’s prior written consent, (i) merge or consolidate with or into any other business entity; or (ii) enter into any joint venture or partnership with any person, firm or corporation.
SECTION 28. CHANGE IN LEGAL STATUS. Without Lender’s prior written consent, Borrower represents and agrees that Borrower will not (i) change its name, its place of business or, if more than one, chief executive office, its mailing address, or organizational identification number if it has one; or (ii) change its type of organization, jurisdiction of organization or other legal structure. If Borrower does not have an organizational identification number and later obtains one, Borrower shall promptly notify Lender of such taxpayer identification number.
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SECTION 29. DEFAULT. The occurrence of any one or more of the following events (herein, “Events of Default”) shall constitute, without notice or demand, a default under this Agreement and all other agreements between Lender and Borrower and instruments and papers given Lender by Borrower, whether such agreements, instruments, or papers now exist or hereafter arise: (i) Lender is unable to collect any Automatic Payment Plan payment on [two] consecutive payment due dates, and/or, Borrower fails to pay any Obligations on [two] consecutive payment due dates, and/or Borrower notifies Lender of its intention to terminate the Authorization Agreement for Direct Deposits (ACH Credits) and Direct Payments (ACH Debits), attached to this Business Loan and Security Agreement; (ii) Borrower fails to comply with, promptly, punctually and faithfully perform or observe any term, condition or promise within this Agreement; (iii) the determination by Lender that any representation or warranty heretofore, now or hereafter made by Borrower to Lender, in any documents, instrument, agreement, or paper was not true or accurate when given; (iv) the occurrence of any event such that any indebtedness of Borrower from any lender other than Lender could be accelerated, notwithstanding that such acceleration has not taken place; (v) the occurrence of any event that would cause a lien creditor, as that term is defined in Section 70A-9a-102 of the Utah Uniform Commercial Code, (other than Lender) to take priority over the Loan made by Lender; (vi) a filing against or relating to Borrower (unless consented to in writing by Lender) of (a) a federal tax lien in favor of the United States of America or any political subdivision of the United States of America, or (b) a state tax lien in favor of any state of the United States of America or any political subdivision of any such state; (vii) the occurrence of any event of default under any other agreement between Lender and Borrower or instrument or paper given Lender by Borrower, whether such agreement, instrument, or paper now exists or hereafter arises (notwithstanding that Lender may not have exercised its rights upon default under any such other agreement, instrument or paper); (viii) any act by, against, or relating to Borrower, or its property or assets, which act constitutes the application for, consent to, or sufferance of the appointment of a receiver, trustee or other person, pursuant to court action or otherwise, over all, or any part of Borrower’s property; (ix) the granting of any trust, mortgage or execution of an assignment for the benefit of the creditors of Borrower, or the occurrence of any other voluntary or involuntary liquidation or extension of debt agreement for Borrower; (x) the failure by Borrower to generally pay the debts of Borrower as they mature; (xi) adjudication of bankruptcy or insolvency relative to Borrower; (xii) the entry of an order for relief or similar order with respect to Borrower in any proceeding pursuant to Title 11 of the United States Code entitled “Bankruptcy” (the “Bankruptcy Code”) or any other federal bankruptcy law; (xiii) the filing of any complaint, application or petition by or against Borrower initiating any matter in which Borrower is or may be granted any relief from the debts of Borrower pursuant to the Bankruptcy Code or any other insolvency statute or procedure; (xiv) the calling or sufferance of a meeting of creditors of Borrower; (xv) the meeting by Borrower with a formal or informal creditors committee; (xvi) the offering by or entering into by Borrower of any composition, extension or any other arrangement seeking relief or extension for the debts of Borrower, or the initiation of any other judicial or non-judicial proceeding or agreement by, against or including Borrower that seeks or intends to accomplish a reorganization or arrangement with creditors; (xvii) the entry of any judgment against Borrower, which judgment is not satisfied or appealed from (with execution or similar process stayed) within 15 days of its entry; (xviii) the occurrence of any event or circumstance with respect to Borrower such that Lender shall believe in good faith that the prospect of payment of all or any part of the Obligations or the performance by Borrower under this Agreement or any other agreement between Lender and Borrower is impaired or there shall occur any material adverse change in the business or financial condition of Borrower (such event specifically includes, but is not limited to, taking additional financing from a third party funder in connection with a merchant cash advance or a working capital loan, in respect of which either daily or weekly or bi-weekly payments are made, without the prior written consent of Lender); (xix) the entry of any court order that enjoins, restrains or in any way prevents Borrower from conducting all or any part of its business affairs in the ordinary course of business; (xx) the occurrence of any uninsured loss, theft, damage or destruction to any material asset(s) of Borrower; (xxi) any act by or against, or relating to Borrower or its assets pursuant to which any creditor of Borrower seeks to reclaim or repossess or reclaims or repossesses all or a portion of Borrower’s assets; (xxii) the termination of existence, dissolution or liquidation of Borrower or the ceasing to carry on actively any substantial part of Borrower’s current business; (xxiii) this Agreement shall, at any time after its execution and delivery and for any reason, cease to be in full force and effect or shall be declared null and void, or the validity or enforceability hereof shall be contested by Borrower or any Guarantor of Borrower denies it has any further liability or obligation hereunder; (xxiv) any Guarantor or person signing a support agreement in favor of Lender shall repudiate, purport to revoke or fail to perform his or her obligations under his Guaranty or support agreement in favor of Lender or any corporate Guarantor shall cease to exist; (xxv) any material change occurs in Borrower’s ownership or organizational structure (acknowledging that any change in ownership will be deemed material when ownership is closely held); (xxvi) if Borrower is a trust, a trustor dies; if Borrower is a partnership, any general or managing partner dies; if Borrower is a corporation, any principal officer or 10% or greater shareholder dies; if Borrower is a limited liability company, any managing member dies; if Borrower is any other form of business entity, any person(s) directly or indirectly controlling 10% or more of the ownership interests of such entity dies; or (xxvii) any Guarantor dies.
SECTION 30. DEFAULT RATE OF INTEREST. To the extent permitted under applicable law, if any amount payable under this Agreement is not paid when due (without regard to any applicable grace periods), whether at the stated maturity, by acceleration or otherwise, in full on the due date for such payment, or upon acceleration of this Agreement, the then outstanding Loan Amount of this Agreement shall bear interest at the Simple Interest Rate on Total Funding Amount set forth in the Business Loan and Security Agreement Supplement (the “Default Rate”) from the date payment was due until such delinquent payment is paid in full to Lender. If the Default Rate is triggered as a result of an Event of Default and Borrower subsequently cures the Event of Default, then all amounts owing hereunder to Lender after such cure will resume bearing interest at the Simple Interest Rate for New Funding Amount rather than at the Default Rate, on the date the Event of Default is cured; provided, however, that the amount owing hereunder may again accrue interest at the Default Rate upon the occurrence of a subsequent Event of Default. This provision shall not imply that Borrower may cure any default or Event of Default or reinstate the Loan after an Event of Default other than as expressly permitted under the terms of this Agreement, nor shall this provision imply that Borrower has a right to delay or extend the dates upon which payments are due under this Agreement. Borrower acknowledges that it would be extremely difficult or impracticable to determine Lender’s actual damages resulting from any late payment or default, and such interest at the Default Rate is a reasonable estimate of those damages and does not constitute a penalty. The remedies of Lender in this Agreement, or at law or in equity, shall be cumulative and concurrent, and may be pursued individually, successively, or together in Lender’s discretion.
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SECTION 31. RIGHTS AND REMEDIES UPON DEFAULT. Subject to applicable law, if an Event of Default as described in Section 29 occurs under this Agreement, at any time thereafter, Lender may exercise any one or more of the following rights and remedies:
| i. | Refrain from Disbursing Loan Proceeds: Lender may refrain from disbursing Borrower’s Loan proceeds or any other amounts which may be due to the Borrower, to Borrower’s Designated Checking Account, in respect of this or any future Loan concluded between Borrower and Lender. |
| ii. | Debit Amounts Due From Borrower’s Accounts: Lender may debit from Borrower’s Designated Checking Account all Automatic Payment Plan payments that Lender was unable to collect and/or the amount of any other Obligations that Borrower failed to pay, including any “Accelerated Indebtedness as defined below. |
| iii. | Accelerate Indebtedness: Lender may declare the entire Obligations immediately due and payable, without notice of any kind to Borrower. |
| iv. | Assemble Collateral: Lender may require Borrower and/or Guarantor to deliver to Lender all or any portion of the Collateral and any and all certificates of title and other documents relating to the Collateral. Lender may require Borrower and/or Guarantor to assemble the Collateral and make it available to Lender at a place to be designated by Lender. Lender also shall have full power to enter, provided Lender does so without a breach of the peace or a trespass, upon the property of Borrower and/or Guarantor to take possession of and remove the Collateral. If the Collateral contains other goods not covered by this Agreement at the time of repossession, Borrower and Guarantor agree Lender may take such other goods, provided that Lender makes reasonable efforts to return them to Borrower and Guarantor after repossession. |
| v. | Sell the Collateral: Lender shall have full power to sell, lease, transfer, or otherwise deal with the Collateral or proceeds thereof in Lender’s own name or that of Borrower and/or Guarantor. Lender may sell the Collateral at public auction or private sale. Unless the Collateral threatens to decline speedily in value or is of a type customarily sold on a recognized market, Lender will give Borrower, Guarantor and other persons as required by law, reasonable notice of the time and place of any public sale, or the time after which any private sale or any other disposition of the Collateral is to be made. However, no notice need be provided to any person who, after an Event of Default occurs, enters into and authenticates an agreement waiving that person’s right to notification of sale. The requirements of reasonable notice shall be met if such notice is given at least 10 days before the time of the sale or disposition. All expenses relating to the disposition of the Collateral, including without limitation the expenses of retaking, holding, insuring, preparing for sale and selling the Collateral, shall become a part of the Obligations secured by this Agreement. To the extent permitted by applicable law, all such expenses will become a part of the Obligations and, at Lender’s option, will: (i) be payable on demand; (ii) be added to the balance of the Loan and be apportioned among and be payable with any installment payments to become due during either (a) the term of any applicable insurance policy or (b) the remaining term of the Loan; or (iii) be treated as a balloon payment that will be due and payable at the Loan’s maturity. |
| vi. | Appoint Receiver: Lender shall have the right to have a receiver appointed to take possession of all or any part of the Collateral, with the power to protect and preserve the Collateral, to operate the Collateral preceding foreclosure or sale, and to collect the rents from the Collateral and apply the proceeds, over and above the cost of the receivership, against the Obligations. The receiver may serve without bond if permitted by law. Lender’s right to the appointment of a receiver shall exist whether or not the apparent value of the Collateral exceeds the Obligations by a substantial amount. Employment by Lender shall not disqualify a person from serving as a receiver. |
| vii. | Collect Revenues, Apply Accounts: Lender, either itself or through a receiver, may collect the payments, rents, income, and revenues from the Collateral. Lender may at any time in Lender’s discretion transfer any Collateral into Lender’s own name or that of Lender’s nominee and receive the payments, rents, income and revenues therefrom and hold the same as security for the Obligations or apply it to payment of the Obligations in such order of preference as Lender may determine. Insofar as the Collateral consists of accounts, general intangibles, insurance policies, instruments, chattel paper, choses in action, or similar property, Lender may demand, collect, receipt for, settle, compromise, adjust, sue for, foreclose or realize on the Collateral as Lender may determine, whether or not any amount included within the Obligations is then due. For these purposes, Lender may, on behalf of and in the name of Borrower and/or Guarantor, receive, open and dispose of mail addressed to Borrower; change any address to which mail and payments are to be sent; and endorse notes, checks, drafts, money orders, documents of title, instruments and items pertaining to payment, shipment or storage of any Collateral. To facilitate collections, Lender may notify account debtors and obligors on any Collateral to make payments directly to Lender. |
| viii. | Obtain Deficiency: If Lender chooses to sell any or all of the Collateral, Lender may obtain a judgment against Borrower and/or Guarantor for any deficiency remaining on the Obligations due to Lender after application of all amounts received from the exercise of the rights provided in this Agreement. Borrower and/or Guarantor shall be liable for a deficiency even if the transaction described in this subsection is a sale of accounts or chattel paper. |
| ix. | Other Rights and Remedies: Lender shall have all the rights and remedies of a secured creditor under the provisions of the Utah Uniform Commercial Code, as may be amended from time to time. In addition, Lender shall have and may exercise any or all other rights and remedies it may have available at law, in equity or otherwise. |
| x. | Setoff. In addition to any rights and remedies of the Lender provided by law, if Borrower is in default, Lender is authorized at any time and form time to time, without prior notice to Borrower, any such notice being waived by the Borrower to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held by, and other indebtedness at any time owing to, the Lender to or for the credit or the account of the Borrower against any and all obligations owing to the Lender, now or hereafter existing, irrespective of whether such obligations may be contingent or unmatured. The Lender agrees promptly to notify the Borrower after any such setoff and application made by the Lender; provided, however, that the failure to give such notice shall not affect the validity of such setoff and application. |
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| xi. | Election of Remedies: Except as may be prohibited by applicable law, all of Lender’s rights and remedies, whether evidenced by this Agreement, any related documents, or by any other writing, shall be cumulative and may be exercised singularly or concurrently. Election by Lender to pursue any remedy shall not exclude pursuit of any other remedy, and an election to make expenditures or to take action to perform an obligation of Borrower under the Agreement, after Borrowers failure to perform, shall not affect Lender’s right to declare a default and exercise its remedies. |
SECTION 32. CONSENT TO JURISDICTION AND VENUE. Subject to Section 33 below, Borrower, each Guarantor and Lender agree that any action or proceeding to enforce or arising out of this Agreement may be brought in any court of the State of Utah or in the United States District Court for the District of Utah, and Borrower and each Guarantor waives personal service of process. Borrower, each Guarantor and Lender agree that venue is proper in such courts.
SECTION 33. ARBITRATION/CLASS ACTION WAIVER. To the extent that a claim or dispute arises out of, or in relation to this Agreement, including without limitation, the terms, construction, interpretation, performance, termination, breach, or enforceability of this Agreement, the parties hereby agree that the claim or dispute shall be, at the election of either party, resolved by mandatory binding arbitration in Utah within a reasonable time period not to exceed ninety (90) days. The parties agree that the arbitration shall be administered by JAMS and the arbitration shall be conducted in accordance with the Expedited Procedures of the JAMS Comprehensive Arbitration Rules and Procedures except as otherwise agreed in this Agreement. The arbitrator shall be chosen in accordance with the procedures of JAMS, and shall base the award on applicable Utah law. Judgment on the award may be entered in any court having jurisdiction, subject to Section 32 above. The parties further agree that the costs of the arbitration shall be divided equally between them, except that Lender will consider in good faith a request by Borrower to pay the costs of arbitration. Each party may pursue arbitration solely in an individual capacity, and not as a representative or class member in any purported class or representative proceeding. The arbitrator may not consolidate more than one person’s or entity’s claims, and may not otherwise preside over any form of a representative or class proceeding. This arbitration section is governed by the Federal Arbitration Act, 9 U.S.C. §§ 1-16.
SECTION 34. NO WAIVER BY LENDER. No delay or omission on the part of Lender in exercising any rights under this Agreement, any related guaranty or applicable law shall operate as a waiver of such right or any other right. Waiver on any one occasion shall not be construed as a bar to or waiver of any right or remedy on any future occasion. All Lender’s rights and remedies, whether evidenced hereby or by any other agreement, instrument or paper, shall be cumulative and may be exercised singularly or concurrently. No waiver by Lender of any of its rights or of any such breach, default, or failure of condition shall be effective, unless the waiver is expressly stated in a writing signed by Lender.
SECTION 35. ASSIGNMENT. This Agreement shall bind and inure to the benefit of the respective successors and assigns of each of the parties hereto; provided, however, that Borrower may not assign this Agreement or any rights or duties hereunder without Lender’s prior written consent and any prohibited assignment shall be absolutely null and void. No consent to an assignment by Lender shall release Borrower from its obligations. Lender may assign this Agreement and its rights and duties hereunder and no consent or approval by Borrower is required in connection with any such assignment. Lender reserves the right to sell, assign, transfer, negotiate or grant participations in all or any part of, or any interest in Lender’s rights and benefits hereunder. In connection with any assignment or participation, Lender may disclose all documents and information that Lender now or hereafter may have relating to Borrower or Borrower’s business. To the extent that Lender assigns its rights and obligations hereunder to another party, Lender thereafter shall be released from such assigned obligations to Borrower and such assignment shall affect a novation between Borrower and such other party.
SECTION 36. INTERPRETATION. Paragraph and section headings used in this Agreement are for convenience only, and shall not affect the construction of this Agreement. Neither this Agreement nor any uncertainty or ambiguity herein shall be construed or resolved against Lender or Borrower, whether under any rule of construction or otherwise. On the contrary, this Agreement has been reviewed by all parties and shall be construed and interpreted according to the ordinary meaning of the words used so as to fairly accomplish the purposes and intentions of all parties hereto. Borrower has obtained the advice of counsel prior to executing this Agreement.
SECTION 37. SEVERABILITY. If one or more provisions of this Agreement (or the application thereof) is determined invalid, illegal or unenforceable in any respect in any jurisdiction, the same shall not invalidate or render illegal or unenforceable such provision (or its application) in any other jurisdiction or any other provision of this Agreement (or its application).
SECTION 38. NOTICES. Except as otherwise provided in this Agreement, notice under this Agreement must be in writing. Notices will be deemed given when deposited in the U.S. mail, postage prepaid, and first class mail; when delivered in person; or when sent by registered mail; by certified mail; or by nationally recognized overnight courier; or when sent by electronic mail. Notice to Borrower will be sent to Borrower’s last known address or electronic mail address in Lender’s records for this Loan. Notice to Lender may be sent to: Mulligan Funding LLC, 4715 Viewridge Ave, San Diego, CA 92123 – Att: Accounting Dept. Borrower agrees to notify Lender immediately if Borrower changes Borrower’s name, Borrower’s postal or electronic mail address or other contact information, if there are any errors in the information regarding transactions on Borrower’s account provided by Borrower to Lender, or any of Borrower or Guarantor(s) dies, is declared incompetent or is subject of a bankruptcy or insolvency proceeding. Borrower and Guarantor(s) agree that a notice of incompetence is not effective unless issued by a court having jurisdiction, and Lender receives notice and instruction from the Court. Notwithstanding the above, Lender may, at Lender’s option, accept other evidence of incompetence acceptable to Lender. Borrower and Guarantor(s) agree to indemnify and hold Lender harmless from and against any and all claims relating to the acceptance or non-acceptance of proof of incompetence in any transaction. This indemnity will survive termination of this Agreement.
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SECTION 39. RECORDKEEPING AND AUDIT REQUIREMENTS. Lender shall have no obligation to maintain any electronic records or any documents, schedules, invoices or any other paper delivered to Lender by Borrower in connection with this Agreement or any other agreement other than as required by law. Borrower will at all times keep accurate and complete records of Borrower’s accounts and Collateral. At Lender’s request, Borrower shall deliver to Lender (i) schedules of accounts and general intangibles; and (ii) such other information regarding the Collateral and Loan as Lender shall request. Lender, or any of its agents, shall have the right to call any telephone numbers that Borrower has provided or may provide in the future or otherwise in the Lender’s possession (including any cellular or mobile telephone number) at intervals to be determined by Lender, and without hindrance or delay, to inspect, audit, check, and make extracts from any copies of the books, records, journals, orders, receipts, correspondence that relate to Borrower’s accounts, Collateral, or other transactions between the parties thereto and the general financial condition of Borrower and Lender may remove any of such records temporarily for the purpose of having copies made thereof. If Borrower was referred to Lender for this Loan by a third party (the “Referring Party”), then Borrower consents to Lender sharing certain reasonable information about Borrower with the Referring Party for purposes of the Referring Party verifying and/or auditing loans made through such Referring Party’s referrals.
SECTION 40. GOVERNING LAW. Subject to Section 33 above, our relationship including this Agreement and any claim, dispute or controversy (whether in contract, tort, or otherwise) at any time arising from or relating to this Agreement is governed by, and this Agreement will be construed in accordance with, applicable federal law and (to the extent not preempted by federal law) Utah law without regard to internal principles of conflict of laws. The legality, enforceability and interpretation of this Agreement and the amounts contracted for, charged and reserved under this Agreement will be governed by such laws. Borrower understands and agrees that (i) Lender is located in Utah; (ii) Lender makes all credit decisions from Lender’s office in Utah; (iii) the Loan is made in Utah (that is, no binding contract will be formed until Lender receives and accepts Borrower’s signed Agreement in, and disburses the Loan Disbursement Amount from, Utah); and (iv) Borrower’s payments are not accepted until received by Lender.
SECTION 41. WAIVER OF NOTICES AND OTHER TERMS. Except for any notices provided for in this Agreement, Borrower and any person who has obligations pursuant to this Agreement (e.g., a Guarantor), to the extent not prohibited by applicable law hereby, waives demand, notice of nonpayment, notice of intention to accelerate, notice of acceleration, presentment, protest, notice of dishonor and notice of protest. To the extent permitted by applicable law, Borrower and any person who has obligations pursuant to this Agreement also agrees: Lender is not required to file suit, show diligence in collection against Borrower or any person who has obligations pursuant to this Agreement, or proceed against any Collateral. Lender may, but will not be obligated to, substitute, exchange or release any Collateral; Lender may release any Collateral, or fail to realize upon or perfect Lender’s security interest in any Collateral; Lender may, but will not be obligated to, sue one or more persons without joining or suing others; and Lender may modify, renew, or extend this Agreement (repeatedly and for any length of time) without notice to or approval by any person who has obligations pursuant to this Agreement (other than the party with whom the modification, renewal or extension is made).
SECTION 42. MONITORING, RECORDING AND ELECTRONIC COMMUNICATIONS. In order to ensure a high quality of service for Lender’s customers, Lender may monitor and/or record telephone calls between Borrower and Lender’s employees or agents. Borrower acknowledges that Lender may do so and agrees in advance to any such monitoring or recording of telephone calls. Borrower also agrees that Lender may communicate with Borrower electronically by e-mail.
SECTION 43. JURY TRIAL WAIVER. To the extent not prohibited by applicable law and to the extent Section 33 is not operative, Borrower and each Guarantor knowingly, intentionally, and voluntarily, with and upon the advice of competent counsel, and Lender by its acceptance hereof, waive their right to a trial by jury of any claim or cause of action based upon, arising out of or related to the Agreement and all other documentation evidencing the obligations, in any legal action or proceeding. Any such claim or cause of action shall be tried by court sitting without a jury.
SECTION 44. CONFIDENTIALITY. Borrower shall not make, publish or otherwise disseminate in any manner a copy of this Agreement or any public statement or description of the terms of this Agreement, except to its employees, advisors and similar persons who have a legitimate need to know its contents.
SECTION 45. ENTIRE AGREEMENT. Any application Borrower signed or otherwise submitted in connection with the Loan, the accompanying Business Loan and Security Agreement Supplement and the Authorization Agreement for Direct Deposit (ACH Credit) and Direct Payments (ACH Debits) and any other documents required by Lender now or in the future in connection with this Agreement and Borrower’s Loan are hereby incorporated into and made a part of this Agreement. This Agreement is the entire agreement of the parties with respect to the subject matter hereof and supersedes any prior written or verbal communications or instruments relating thereto.
SECTION 46. COUNTERPARTS; ELECTRONIC OR FAX SIGNATURES. This Agreement may be executed in one or more counterparts, each of which counterparts shall be deemed to be an original, and all such counterparts shall constitute one and the same instrument. For purposes of the execution of this Agreement, facsimile signatures delivered by electronic or fax submission shall be treated in all respects as original signatures.
SECTION 47. CUSTOMER SERVICE CONTACT INFORMATION. If you have questions or comments about your Loan, you may contact us by (i) e-mail at [email protected], (ii) telephone at 844-437-3863.
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SECTION 48. PERSONAL GUARANTY. The undersigned (each a “Guarantor”), jointly and severally (if more than one), absolutely and unconditionally guarantee the prompt payment to Lender, including its successors and assignees, of any and all Obligations incurred by the Borrower pursuant to the Agreement (this “Personal Guaranty”). Each Guarantor further agrees to repay the Obligations on demand, without requiring Lender first to enforce payment against Borrower, or against any other Guarantor, if applicable. This is a guarantee of payment and not of collection. This is an absolute, unconditional, primary, and continuing obligation and will remain in full force and effect until the first to occur of the following: (a) all of the Obligations have been indefeasibly paid in full, and Lender has terminated this Personal Guaranty, or (b) 30 days after the date on which written notice of revocation is actually received and accepted by Lender. No revocation will affect: (i) the then existing liabilities of the revoking Guarantor under this Personal Guaranty; (ii) Obligations created, contracted, assumed, acquired or incurred prior to the effective date of such revocation; (iii) Obligations created, contracted, assumed, acquired or incurred after the effective date of such revocation pursuant to any agreement entered into or commitment obtained prior to the effective date of such revocation; or (iv) any Obligations then or thereafter arising under the agreements or instruments then in effect and then evidencing the Obligations. Each Guarantor represents and warrants that it is a legal resident of the United States of America. Each Guarantor waives all notices to which the Guarantor might otherwise be entitled by law, and also waives all defenses, legal or equitable, otherwise available to the Guarantor. This Personal Guaranty shall be construed in accordance with the laws of the State of Utah, and shall inure to the benefit of Lender, its successors and assigns. To the extent not prohibited by applicable law, each of the undersigned Guarantors affirmatively agree to be subject to Section 33, and Section 43 of this Agreement (“Consent to Jurisdiction and Venue”, “Arbitration/Class Action Waiver”, and “Jury Trial Waiver” respectively).
SECTION 49. CERTIFICATION AND SIGNATURES. By signing above and/or below or authorizing the person signing below to sign on its behalf, Borrower certifies that Borrower has received a copy of this Agreement; the accompanying Business Loan and Security Agreement Supplement; and the Authorization Agreement for Direct Deposit (ACH Credit) and Direct Payments (ACH Debits), and that Borrower has read, understood and agreed to be bound by their terms. Each person signing below certifies that each person is signing on behalf of the Borrower in the capacity indicated below the signer’s name and that such signer is authorized to execute this Agreement on behalf of or the in stated relation to Borrower.
Use of Proceeds Certification
As referred to in Section, by signing below, the Borrower certifies, acknowledges and understands that the proceeds from the requested Loan will be used solely for commercial and business purposes; and that the proceeds will not be used for personal, family or household purposes.
[Signature page follows]
|
NOTICE TO GUARANTOR
You are being asked to guarantee the past, present, and future Obligations of Borrower. If Borrower does not pay, you will have to. You may also have to pay collection costs. Lender can collect the Obligations from you without first trying to collect from Borrower or another Guarantor or proceeding against any other Collateral or other security for the Obligations. |
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| Guarantor: | Borrower: | |||
| /s/ Mahesh Choudhury | /s/ Mahesh Choudhury | |||
| (Signature) | (Signature) | |||
| MAHESH CHOUDHURY | BOURQUE HEATING & COOLING CO., INC. dba - Bourque Heating & Cooling | |||
| Title: | Manager | Title: | Manager | |
| Date: | 10/20/2025 | Date: | 10/20/2025 | |
| Note: This Signature Page must be signed and dated before a loan can be funded. |
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CERTIFICATION OF BENEFICIAL OWNER(S)
Please verify that the following information is accurate AND complete:
| 1. | The information regarding the Legal Entity (The First Section below); | |
| 2. | Any individual(s), who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise owns 25% or more of the equity interests of the legal entity listed below (if no individual/s meet this definition, please leave the Second Section blank and proceed to the Third Section); AND | |
| 3. | An individual with significant responsibility for managing or directing the business (e.g., CEO, President COO, Managing Member, etc) - irrespective of that individual’s ownership %. |
If any of the information provided is inaccurate or incomplete, please contact Mulligan Funding at [email protected] or 844-437-3863 to update.
For more information on Beneficial Ownership Certification, visit the following page: https://www.mulliganfunding.com/beneficial-ownership/
I, MAHESH CHOUDHURY, am opening a loan account with Mulligan Funding on behalf of the legal entity listed below:
LEGAL ENTITY
| Name of Legal Entity | Corporate Structure | ||
| BOURQUE HEATING & COOLING CO., INC. | Corporation | ||
| Address | City | State | Zip |
| 2 MOUNT ROYAL AVE STE 550 50 |
MARLBOROUGH | MA | 01752 |
INDIVIDUAL(S) WHO OWN 25% OR MORE OF THE INTERESTS OF THE LEGAL ENTITY
| Last Name | First Name | M.I. | Date of Birth |
| CHOUDHURY | MAHESH | 02/07/1969 | |
| Address | City | State | Zip |
| 2 MOUNT ROYAL AVE STE 550 50 |
MARLBOROUGH | MA | 01752 |
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| Country | SSN (U.S. Persons) |
| United States | ***-**-2882 |
| For Non-U.S. persons (SSN, Passport Number or other similar identification number)* | Country of issuance: |
INDIVIDUAL RESPONSIBLE FOR MANAGING OR DIRECTING THE BUSINESS
| Last Name | First Name | M.I. | Date of Birth |
| CHOUDHURY | MAHESH | 02/07/1969 | |
| Address | City | State | Zip |
| 2 MOUNT ROYAL AVE STE 550 50 |
MARLBOROUGH | MA | 01752 |
| Country | SSN (U.S. Persons) | ||
| United States | ***-**-2882 | ||
| For Non-U.S. persons (SSN, Passport Number or other similar identification number)* | Country of issuance: | ||
*Note: In lieu of a passport number, Non-U.S. Persons may also provide a Social Security Number, an alien identification card number, or number and country of issuance of any other government-issued document evidencing nationality or residence and bearing a photograph or similar safeguard.
I, MAHESH CHOUDHURY, hereby certify, to the best of my knowledge, that the information provided above is complete and correct and that I will promptly notify Mulligan Funding of any changes to this information.
| Signature: | /s/ Mahesh Choudhury | Date: | 10/20/2025 |
18
Exhibit 10.6
Account: #37097035
BLUE SKY ELECTRIC, INC
Business Line of Credit Supplement
This Business Line of Credit Agreement Supplement is part of (and incorporated by reference into) the Business Line of Credit Agreement. Borrower should keep this important legal document for Borrower's records.
| YOUR LINE OF CREDIT DETAILS | |
| Borrower: | BLUE SKY ELECTRIC, INC |
| Lender: | Headway Capital, LLC |
| Guarantor(s): | Mahesh Choudhury |
| Initial
Credit Limit: (See Additional Disclosures section below) |
$43,100.00 |
| Initial
Applicable APR: (See Additional Disclosures section below) |
73.84% |
| Initial
Applicable Amortization Period: (See Additional Disclosures section below) |
12 monthly Payments |
| Minimum
Advance Amount: (See Additional Disclosures section below) |
$500 |
| FEES | |
| Fees: | Advance
Fee: 2.00% of Advance Late Payment Fee: 5% of Minimum Monthly Payment |
| ADDITIONAL DISCLOSURES | |
| Credit Limit is Subject to Change | The
initial Credit Limit may be changed by Lender. See "Credit Limit" definition in Section 2 of your Business Line of Credit Agreement. |
| Applicable APR is Subject to Change | The
initial Applicable APR may be changed by Lender. See "Applicable APR" definition in Section 2 of your Business Line of Credit Agreement. |
Account: #37097035
BLUE SKY ELECTRIC, INC
| ADDITIONAL DISCLOSURES | |
| Advance Fee is Subject to Change | The
Advance Fee may be changed by Lender. See "Advance Fee" definition in Section 2 of your Business Line of Credit Agreement. |
| Applicable
Amortization Period is Subject to Change and Payment Schedule is Re-Set whenever an Advance is taken on your Line of Credit |
The
initial Applicable Amortization Period may be changed by Lender. See "Applicable Amortization Period" definition in Section 2 of your Business Line of Credit Agreement. The Payment Schedule for the entire outstanding balance owed to Lender is re-set every time you take an Advance on your Line of Credit. See Section 11 of your Business Line of Credit Agreement. |
| Minimum Advance Amount is Subject to Change | The
initial Minimum Advance Amount may be changed by Lender. See Section 8 of your Business Line of Credit Agreement. Depending on the state where you are located, you may be required to take an initial Advance amount that is higher than the Minimum Advance Amount when you execute your Business Line of Credit Agreement. |
| Early Prepayment | Borrower
may prepay any amounts owed under the Line of Credit. Note that Advances under your Line of Credit accrue interest daily in an amount equal to the Daily Interest Charge. Accordingly, beginning with the first interest accrual day that follows the application of your prepayment, you will no longer accrue interest on the portion of such prepayment allocated to principal in accordance with the terms of your Line of Credit. See "Daily Interest Charge" definition in Section 2, and also Sections 11 and 17 of your Business Line of Credit Agreement. |
Account: #37097035
BLUE SKY ELECTRIC, INC
| ADDITIONAL DISCLOSURES | |
| Loan For Specific Purposes Only | The proceeds of the requested Line of Credit may solely be used for the specific purposes as set forth in the Use of Proceeds Certification of the Business Line of Credit Agreement. IN ADDITION, THE LINE OF CREDIT WILL NOT BE USED FOR PERSONAL, FAMILY OR HOUSEHOLD PURPOSES. Borrower understands that Borrower's agreement not to use the Line of Credit proceeds for personal, family or household purposes means that certain important duties imposed upon entities making loans for consumer/personal purposes, and certain important rights conferred upon consumers, pursuant to federal or state law will not apply to this transaction. |
If you have any questions, please call us at 1.866.698.8494 (we have support available Monday - Friday 8am - 5pm CST) or email [email protected]
Business Line of Credit and Security Agreement
| 1. | INTRODUCTION. This Business Line of Credit Agreement (together with the accompanying Business Line of Credit Agreement Supplement and the accompanying Authorization Agreement for Direct Deposits (ACH Credits) and Direct Payments (ACH Debits), the "Agreement") governs your revolving business line of credit and any and all Advances (as defined below) hereunder (together, the "Line of Credit") from Headway Capital, LLC and your use of the password protected dedicated online account ("Online Account") in connection with the Line of Credit. Please read it and keep it for your reference. In this Agreement, the words "you," "your" and "Borrower" means the Borrower identified on the signature page of this Business Line of Credit Agreement. Each Guarantor identified on the signature page of this Business Line of Credit Agreement shall be referred to individually as "Guarantor" and collectively as "Guarantors" in this Agreement. The words "Headway", "Lender", "we", "us", and "our" mean Headway Capital, LLC, any servicing agent of Headway Capital, LLC, or its successor(s) and assign(s). |
| 2. | CERTAIN DEFINITIONS. For purposes of this Agreement, the term: |
"Advance" shall have the meaning set forth in Section 8. An Advance may also be called a "Draw."
"Advance Fee" means the fee charged at the time you obtain an advance as a percentage of the Advance amount requested. The initial Advance Fee is disclosed in the accompanying Business Line of Credit Agreement Supplement. Lender may increase or decrease the amount of the Advance Fee without prior notice to Borrower or Guarantor. Any change to the Advance Fee will be disclosed to you in your Online Account at the time you request any Advance. By requesting an Advance, you agree to the Advance Fee disclosed at the time you make that request. The Advance Fee may also be called the "Draw Fee."
"Advance Request" shall have the meaning set forth in Section 9.
"Applicable Amortization Period" means, as of any date of determination, the number of weeks or months then identified as the Applicable Amortization Period in the Online Account; it being acknowledged and agreed that (x) the initial Applicable Amortization Period shall be the period set forth on the accompanying Business Line of Credit Agreement Supplement, (y) the initial Applicable Amortization Period and/or any subsequent Applicable Amortization Period may be increased or decreased by the mutual agreement of Lender and Borrower (it being acknowledged and agreed that Borrower's agreement may be reflected by it making a request for such increase or decrease in the Online Account) or pursuant to Section 12 of this Agreement, and (z) any such increase or decrease shall in no way affect Borrower's obligation to pay any amounts owed by Borrower hereunder;
Account: #37097035
BLUE SKY ELECTRIC, INC
"Applicable APR" means, as of any date of determination, the rate then identified as the Applicable APR in the Online Account; it being acknowledged and agreed that (x) the initial Applicable APR shall equal the amount set forth on the accompanying Business Line of Credit Agreement Supplement, (y) the initial Applicable APR and/or any subsequent Applicable APR may be increased or decreased by Lender in any amount and at any time, without penalty, in Lender’s sole and absolute discretion, provided that Lender shall reflect such change in the Online Account and any such change shall only become effective as of the immediately succeeding Advance Request and shall remain effective until any subsequent increase or decrease hereunder, and (z) any such increase or decrease shall in no way affect Borrower’s obligation to pay any amounts owed by Borrower hereunder;
"Available Advance Amount" means, as of any date of determination, an amount equal to (1) the Credit Limit, minus (2) the Total Outstanding Principal Amount, minus (3) outstanding Advance Request amounts, if any, and, at Lender's sole and absolute discretion, minus (4) a reserve amount set by Lender to ensure recent principal payments initiated by Borrower have finally been received by Lender;
"Credit Limit" means, as of any date of determination, the amount then identified as the Credit Limit in the Online Account; it being acknowledged and agreed that (x) the initial Credit Limit shall equal the amount set forth on the accompanying Business Line of Credit Agreement Supplement, (y) the initial Credit Limit and/or any subsequent Credit Limit may be increased or decreased by Lender in any amount and at any time, without penalty, in Lender's sole and absolute discretion, and (z) any such increase or decrease shall in no way affect Borrower's obligation to pay any amounts owed by Borrower hereunder;
"Daily Periodic Rate" means the daily interest rate applied to the Total Outstanding Principal Amount. The Daily Periodic Rate does not include the Advance Fee.
"Monthly Periodic Rate" means the monthly interest rate applied to the Total Outstanding Principal Amount. The Monthly Periodic Rate does not include the Advance Fee.
"Daily Interest Charge" means, as of any date of determination, an amount equal to the product of (x) the Daily Periodic Rate; and (y) Total Outstanding Principal Amount as of such date immediately prior to any application and allocation of principal in connection with any payment, if any, made by Borrower on such date, as set forth on the Lender's books and records;
"Obligations" means, with respect to Borrower, all obligations to perform acts and refrain from taking action hereunder, including, without limitation, obligations to pay all amounts owed hereunder including, without limitation, all principal, interest, and other fees and expenses;
"Payment Schedule" shall have the meaning set forth in Section 11;
"Periodic Payment Amount" shall have the meaning set forth in Section 11;
"Scheduled Payment Date" means, the day of each month then identified as the Scheduled Payment Day in the Online Account (or, if such day is not a Business Day, the immediately preceding or succeeding Business Day, solely at the discretion of Lender); it being acknowledged and agreed that (a) the Scheduled Payment Date can be changed by Lender to a different day of each calendar week or month, without penalty, in Lender's sole and absolute discretion, (b) Lender can give notice of any such change to the Scheduled Payment Date by posting such Notice in the Online Account, by sending an e-mail to Borrower using the Borrower's e-mail address on file with the Lender, or by any other method described in Section 48 of this Agreement, and (c) any such change shall in no way affect Borrower's obligation to pay any amounts owed by Borrower hereunder;
"Total Outstanding Principal Amount" means, as of any date of determination, the aggregate outstanding principal balance of all Advances hereunder as set forth on the Lender's books and records, including any Advance Fee(s) added to the aggregate outstanding principal balance; and
"Unpaid Interest Outstanding" means, as of any date of determination, the aggregate amount of accrued and unpaid interest as set forth on the Lender's books and records.
| 3. | EFFECTIVE DATE. This Agreement begins on the date we accept this Agreement in Utah. Borrower understands and agrees that Lender may postpone, without penalty, the disbursement of amounts to Borrower under the Line of Credit (including, for the avoidance of doubt, any and all Advances) until Lender has received all required personal guarantees, the accompanying Authorization Agreement for Direct Deposit (ACH Credit) and Direct Payments (ACH Debits), or other documentation. |
| 4. | AUTHORIZATION. Borrower agrees that the Line of Credit (including, for the avoidance of doubt, any and all Advances) made by Lender to Borrower and any and all Advance Requests (as defined below) shall be conclusively deemed to have been authorized by Borrower and to have been made pursuant to duly authorized requests on its behalf. |
Account: #37097035
BLUE SKY ELECTRIC, INC
| 5. | ACCESS TO ONLINE ACCOUNT. When Borrower signs in to its Online Account with Borrower's valid username and password at a specified section of Headwaycapital.com, Borrower can obtain information about Borrower's Line of Credit, make an Advance Request as provided for herein and perform such other actions made available by Lender from time to time. No additional paper statement will be mailed to Borrower. Borrower agrees not to share Borrower’s username and password to Borrower’s Online Account with any third party. Borrower must promptly report any unauthorized use of Borrower’s Online Account to Lender by telephone at (866) 698-8494 or by email at. |
| 6. | LINE OF CREDIT FOR SPECIFIC PURPOSES ONLY. The proceeds of the Line of Credit (including, for the avoidance of doubt, any and all Advances) may solely be used for the specific purposes as set forth in the Use of Proceeds Certification contained in Section 58 below, and not for any other purposes. In addition, the Line of Credit (including, for the avoidance of doubt, any and all Advances) will not be used for personal, family or household purposes, and Borrower and Guarantors are forever estopped from taking the position that such Loan (including Advances) are or were used for such personal, family or household purposes. Borrower understands that Borrower's agreement not to use the proceeds of the Line of Credit (including, for the avoidance of doubt, any and all Advances) for personal, family or household purposes means that certain important duties imposed upon entities making loans for personal, family or household purposes, and certain important rights conferred upon such persons, pursuant to federal or state law will not apply to the Line of Credit (including, for the avoidance of doubt, any and all Advances), the Online Account or this Agreement. Borrower also understands that Lender will be unable to confirm whether the use of the Line of Credit (including, for the avoidance of doubt, any and all Advances) conforms to this section. Borrower agrees that a breach by Borrower of the provisions of this section will not affect Lender's right to (i) enforce Borrower's promise to pay for all amounts owed under this Agreement, regardless of the purpose for which the Line of Credit (including, for the avoidance of doubt, any and all Advances) is in fact obtained or used or (ii) use any remedy legally available to Lender, even if that remedy would not have been available had the Line of Credit (including, for the avoidance of doubt, any and all Advances) been made for personal, family or household purposes. |
| 7. | MAINTENANCE OF BORROWER'S BANK ACCOUNT. Borrower agrees to maintain funds in the Designated Checking Account (as defined in the accompanying Authorization Agreement for Direct Deposits (ACH Credits) and Direct Payments (ACH Debits)) in amounts that are sufficient to enable the processing of any payment that Borrower is obligated to pay Lender pursuant to this Agreement. The Borrower represents and warrants that the Designated Checking Account is its operating account and is the account that was reviewed in conjunction with underwriting and approval of this Line of Credit. Borrower shall keep the Designated Checking Account open until the Total Outstanding Principal Amount, the Unpaid Interest Outstanding, and any and all other amounts owed hereunder have been paid to Lender in full and no further Advances are to be made hereunder. |
| 8. | ADVANCES. Subject to the terms and conditions hereunder, the Lender may in its sole and absolute discretion make an advance to the Borrower under the Line of Credit following its receipt of an Advance Request (as defined below) by disbursing proceeds from time to time to the Borrower in the manner set forth herein (each an "Advance" and, collectively "Advances"). Borrower acknowledges and agrees that the Lender shall not be required to, and the Borrower shall not request the Lender to, make an Advance (i) in an amount that is less than certain minimum advance amounts established by Lender in its sole and absolute discretion from time to time, (ii) in an amount that exceeds the Available Advance Amount as of such date, or (iii) if any portion of a due and payable Periodic Payment Amount remains unpaid. In the event that Lender has made an Advance in an amount that exceeds the Available Advance Amount as of the date of such Advance, Borrower agrees (x) at Lender's request, to immediately repay the amount of such excess; and (y) that any such excess will not be deemed to be constitute an increase in the Credit Limit hereunder. |
| 9. | ADVANCE REQUESTS. The Borrower may request an Advance ("Advance Request") by (i) accessing the Online Account and completing the steps delineated therein for the online submission of an Advance Request or (ii) using any other method that Lender may in its sole and absolute discretion make available to Borrower from time to time, provided that, in each case the Advance amount being requested shall be in an amount (x) equal to or greater than certain minimum advance amounts established by Lender in its sole and absolute discretion from time to time, and (y) not to exceed the Available Advance Amount as of such date. Following Lender's approval of an Advance Request (which shall be in Lender's sole and absolute discretion) and satisfaction of the applicable conditions set forth in this Agreement, Lender will make an Advance to Borrower by disbursing the related proceeds (less any applicable fees) by making an ACH credit or wire transfer to the Designated Checking Account. Borrower expressly acknowledges that, due to transaction processing, proceeds from any Advance disbursement may take up to two (2) business days following Lender's approval of the related Advance Request to be actually received by the Borrower. |
| 10. | CONDITIONS OF WILLINGNESS TO CONSIDER LENDING. Lender, in its sole and absolute discretion, may decide not to approve an Advance Request or suspend Borrower's ability to make an Advance Request for any reason including, without limitation, if on the date of such Advance Request, (i) Borrower's representations and warranties set forth in this Agreement are untrue or incorrect on the date of such Advance Request and/or an earlier date contemplated by such representation or warranty; (ii) an event has occurred that constitutes an Event of Default hereunder or which, with notice or the passage of time or both, would constitute an Event of Default hereunder, (iii) any portion of a due and payable Periodic Payment Amount remains unpaid; or (iv) the amount of the Advance being requested by Borrower pursuant to such Advance Request exceeds the Available Advance Amount. |
Account: #37097035
BLUE SKY ELECTRIC, INC
| 11. | INTEREST ON ADVANCES; PAYMENT SCHEDULE. Advances shall accrue interest daily in an amount equal to the Daily Interest Charge and shall be payable in arrears on each Scheduled Payment Date and upon any prepayment of Borrower's Line of Credit, whether in whole or in part, or whether voluntary or mandatory. Interest payable shall be computed on the basis of a 365.25 day year, in each case for the actual number of days elapsed in the period during which it accrues. Principal and interest on the Advances and other amounts owed hereunder shall be regularly paid by the Borrower in accordance with the payment schedule contemplated in this Section 11 (the "Payment Schedule"). The Payment Schedule will be set (and re-set in connection with each Advance made hereunder) by Lender in the following manner: In connection with each Advance made by Lender to Borrower hereunder, Lender will compute the periodic payment amounts (each a "Periodic Payment Amount") that would cause the Lender to be repaid in full the Total Outstanding Principal Amount, any Advance Fee, and the aggregate interest amount (calculated based on the Applicable APR) that would accrue over the course of the Applicable Amortization Period assuming equal periodic payment amounts each week or calendar month (it being understood that, depending on the day of the week or calendar month on which the related Advance is made by Lender to Borrower, the Periodic Payment Amount that will apply solely with respect to the final scheduled payment of the Payment Schedule may reflect an increase to or decrease from the equal Periodic Payment Amounts applicable with respect to each of the earlier scheduled payments under such Payment Schedule). For the avoidance of doubt, Lender shall make the foregoing computation in connection with each Advance made by Lender and the most recent of such computations shall be used for all purposes hereunder. On each Scheduled Payment Date, Borrower shall make a payment in an amount equal to the sum of the applicable Periodic Payment Amount and all other amounts owed hereunder, if any (including by way of Lender's initiation of ACH debit entries to the Designated Checking Account, it being understood that the Lender is authorized, but not required, to (i) initiate ACH debit entries to the Designated Checking Account on any Scheduled Payment Date and (ii) if initiated, to initiate in an amount equal to or less than the sum of the applicable Periodic Payment Amount and all other amounts owed hereunder). Borrower acknowledges and agrees that should Lender fail to receive any portion of the foregoing payment amount on any Schedule Payment Date, the Lender is authorized, but not required, to initiate ACH debit entries to the Designated Checking Account on any subsequent business day until such payment amount and any and all other amounts owed hereunder, in each case as set forth in the Lender's books and records are paid in full. |
| 12. | MODIFICATION OF PAYMENT SCHEDULE. Borrower and Guarantor agree that Lender may modify the Payment Schedule ("Modified Payment Schedule") by modifying the amount of each payment, the total number of payments, and/or the Applicable Amortization Period without prior consent from Borrower or Guarantor, so long as the modification does not increase the total Periodic Payment Amount identified in Section 11. Lender will notify Borrower of any such modification of the Payment Schedule by providing notice pursuant to the provisions of Section 48 of this Agreement. In the event of a modification of the Payment Schedule under this Section, all other terms of this Agreement shall remain unchanged. Borrower and Guarantor agree that any modification of the Payment Schedule under this Section shall not affect Borrower's or Guarantor's obligations under this Agreement. |
| 13. | PROMISE TO PAY. Borrower agrees to make to Lender each of the payments contemplated by Sections 11 and 12 in the manner contemplated thereby. Borrower agrees to pay Lender the principal balance of all Advances hereunder, all interest owed hereunder, and any and all other charges and/or other sums imposed by Lender in accordance with the terms of this Agreement. Borrower agrees to enroll in Lender's Automatic Payment Plan and authorizes Lender to collect required payments hereunder as provided in the accompanying Authorization Agreement for Direct Deposits (ACH Credits) and Direct Payments (ACH Debits). If required by Lender, Borrower further agrees and authorizes Lender or its servicer to collect required payments from a transfer account established pursuant to certain Transfer Online Account Line of Credit Documentation that will be provided by Lender in connection with this Agreement if applicable. |
| 14. | ALTERNATIVE PAYMENT METHODS. If Borrower knows that for any reason Lender will be unable to process a payment under Lender's Automatic Payment Plan, then Borrower must either restore sufficient funds such that the missed payment can be collected as provided in the accompanying Authorization Agreement for Direct Deposits (ACH Credits) and Direct Payments (ACH Debits), or promptly mail or deliver a check payable to Headway Capital, LLC in the amount of the missed payment or, if offered, make the missed payment by any pay-by-phone or online service that Lender may make available from time to time. If Borrower elects to send payments on Borrower's Line of Credit by postal mail, then Borrower agrees to send such payments to Headway Capital, 4700 W. Daybreak Pkwy. Suite 200, South Jordan, UT 84009 Attn: Director of Operations. All alternative payments must be made in good funds by check, money order, wire transfer, automatic transfer from an account at an institution offering such service, or other instrument in U.S. Dollars. Borrower understands and agrees that payments made at any other address than as specified by Lender may result in a delay in processing and/or crediting. If Borrower makes an alternative payment on Borrower's Line of Credit by mail or by any pay-by-phone or online service that Lender makes available while Borrower is enrolled in the Automatic Payment Plan, Lender may treat such payment as an additional payment and continue to process Borrower’s scheduled Automatic Payment Plan payments or may reduce any scheduled Automatic Payment Plan payment by the amount of any such additional payment received. |
Account: #37097035
BLUE SKY ELECTRIC, INC
| 15. | APPLICATION OF PAYMENTS. Subject to applicable law, Lender reserves the right to allocate and apply payments actually received on Borrower's Line of Credit between principal, interest, fees and other amounts owed hereunder in any manner Lender chooses in Lender's sole discretion; it being understood that the Lender will generally allocate and apply payments in the following sequential order: (i) past due amounts; (ii) unpaid fees and/or charges owed hereunder; (iii) Unpaid Interest Outstanding; and (iv) the Total Outstanding Principal Amount; it being further understood that the order of application of payments may vary based on the state where Borrower is located. |
| 16. | POST-DATED CHECKS, RESTRICTED ENDORSEMENT CHECKS AND OTHER DISPUTED OR QUALIFIED PAYMENTS. Lender can accept late, postdated or partial payments without losing any of Lender's rights under this Agreement (a postdated check is a check dated later than the day it was actually presented for payment). Lender is under no obligation to hold a postdated check and Lender reserves the right to process every item presented as if dated the same date received by Lender or Lender's check processor unless Borrower gives Lender adequate notice and a reasonable opportunity to act on it. Except where such notice and opportunity is given, Borrower may not hold Lender liable for depositing any postdated check. Borrower agrees not to send Lender partial payments marked "paid in full," "without recourse," or similar language. If Borrower sends such a payment, Lender may accept it without losing any of Lender's rights under this Agreement. All notices and written communications concerning postdated checks, restricted endorsement checks (including any check or other payment instrument that indicates that the payment constitutes "payment in full" of the amount owed or that is tendered with other conditions or limitations or as full satisfaction of a disputed amount) or any other disputed, nonconforming or qualified payments, must be mailed or delivered to Headway Capital, LLC, Client Service, 4700 W. Daybreak Pkwy., Suite 200, South Jordan, UT 84009, Attn: Director of Operations. |
| 17. | PREPAYMENT. Borrower may prepay Borrower's Line of Credit in whole on any Business day by paying Lender the sum total of the Total Outstanding Principal Amount, the Unpaid Interest Outstanding, and any and all other amounts owed hereunder, in each case as set forth in the Lender's books and records. Borrower may prepay Borrower's Line of Credit in part on any Business Day and such payment shall be applied by Lender in accordance with Section 15. |
| 18. | SECURITY INTEREST. Borrower hereby grants to Lender, the secured party hereunder, a continuing security interest in and to any and all "Collateral" as described below to secure payment and performance of all debts, liabilities and obligations of Borrower to Lender hereunder and also any and all other debts, liabilities and obligations of Borrower to Lender of every kind and description, direct or indirect, absolute or contingent, primary or secondary, due or to become due, now existing or hereafter arising, related to the Line of Credit described in this Agreement, whether or not contemplated by the parties at the time of the granting of this security interest, regardless of how they arise or by what agreement or instrument they may be evidenced or whether evidenced by any agreement or instrument, and includes obligations to perform acts and refrain from taking action as well as obligations to pay money including, without limitation, all interest, other fees and expenses (all hereinafter called "Obligations"). The Collateral includes the following property that Borrower now owns or shall acquire or create immediately upon the acquisition or creation thereof: (i) any and all amounts owing to Borrower now or in the future from any merchant processor(s) processing charges made by customers of Borrower via credit card or debit card transactions; and (ii) all other tangible and intangible personal property, including, but not limited to, (a) cash and cash equivalents, (b) inventory, (c) equipment, (d) investment property, including certificated and uncertificated securities, securities accounts, security entitlements, commodity contracts and commodity accounts, (e) instruments, including promissory notes, (f) chattel paper, including tangible chattel paper and electronic chattel paper, (g) documents, (h) letter of credit rights, (i) accounts, including health care insurance receivables, (j) deposit accounts, (k) commercial tort claims, (I) general intangibles, including payment intangibles and software, and (m) as extracted collateral as such terms may from time to time be defined in the Uniform Commercial Code. The security interest Borrower grants includes all accessions, attachments, accessories, parts, supplies and replacements for the Collateral, all products, proceeds and collections thereof and all records and data relating thereto. Lender disclaims any security interest in collateral in which Lender is forbidden by law from taking a security interest. |
| 19. | PROTECTING THE SECURITY INTEREST. Borrower agrees that Lender and/or Lender's representative may file any financing statement, lien entry form or other document Lender and/or Lender's representative requires in order to perfect, amend or continue Lender's security interest in the Collateral and Borrower agrees to cooperate with Lender and Lender's representative as may be necessary to accomplish said filing and to do whatever Lender and Lender's representative deems necessary to protect Lender's security interest in the Collateral. Borrower and Guarantor each agree that, if any Guarantor is a corporate entity, then Lender or Lender's representative may file any financing statement, lien entry form or other document against such Guarantor or its property that Lender and/or Lender's representative requires in order to perfect, amend or continue Lender's security interest in the Collateral. Any such Guarantor agrees to cooperate with Lender and Lender’s representative as may be necessary to accomplish said filing and to do whatever Lender or Lender’s representative deems necessary to protect Lender’s security interest in the Collateral. In this Agreement, "Lender’s Representative" means any entity or individual that is designated by Lender to serve in such capacity. |
Account: #37097035
BLUE SKY ELECTRIC, INC
| 20. | LOCATION OF COLLATERAL; TRANSACTIONS INVOLVING COLLATERAL. Unless Lender has agreed otherwise in writing, Borrower agrees and warrants that (i) all Collateral (or records of the Collateral in the case of accounts, chattel paper and general intangibles) of Borrower shall be located at Borrower's address as shown in the application, (ii) except for inventory sold or accounts collected in the ordinary course of Borrower's business, Borrower shall not sell, offer to sell, or otherwise transfer or dispose of its Collateral, (iii) no one else has any interest in or claim against the Collateral that Borrower has not already told Lender about; (iv) Borrower shall not pledge, mortgage, encumber or otherwise permit the Collateral to be subject to any lien, security interest, encumbrance or charge, other than a security interest in favor of Lender and (iv) Borrower shall not sell, offer to sell, or otherwise transfer or dispose of the Collateral for less than the fair market value thereof. Borrower shall defend Lender's rights to the Collateral against the claims and demands of all other persons. All proceeds from any unauthorized disposition of the Collateral shall be held in trust for Lender, shall not be co-mingled with any other funds and shall immediately be delivered to Lender. This requirement, however, does not constitute consent by Lender to any such disposition. |
| 21. | TAXES, ASSESSMENTS AND LIENS. Borrower will complete and file all necessary federal, state and local tax returns and will pay when due all taxes, assessments, levies and liens upon its assets and provide evidence of such payments to Lender upon request. |
| 22. | INSURANCE. Borrower shall procure and maintain insurance with insurance companies that the Borrower believes are financially sound and reputable, in such amounts with such deductibles and covering such risks as the Borrower believes in good faith are customarily carried by companies engaged in similar businesses. In any event, such insurance shall be acceptable to Lender to protect the Collateral and shall be issued by a company reasonably acceptable to Lender naming Lender as a loss payee. Lender may request, and Borrower shall provide within 10 business days of receipt of such request, proof of insurance acceptable to Lender. If Borrower at any time fails to obtain or maintain any insurance as required by this Agreement, Lender may obtain such insurance as Lender deems appropriate at Borrower's sole cost and expense. Borrower shall promptly notify Lender of any loss of or damage to the Collateral. |
| 23. | REPAIRS AND MAINTENANCE. Borrower agrees to keep and maintain, and to cause others to keep and maintain, the Collateral in good order, repair and condition at all times while this Agreement remains in effect. Borrower further agrees to pay when due all claims for work done on, or services rendered or material furnished in connection with the Collateral so that no lien or encumbrance (other than a lien or encumbrance by the Lender) may ever attach to or be filed against the Collateral. |
| 24. | INSPECTION OF COLLATERAL AND PLACE OF BUSINESS; USE OF PHOTOGRAPHS AND TESTIMONIALS. Lender and Lender's designated representatives and agents shall have the right during Borrower's normal business hours and at any other reasonable time to examine the Collateral wherever located and the interior and exterior of any Borrower place of business. To the extent that Lender or Lender's designated representatives choose to examine the Collateral and place of business outside of normal business hours, Lender shall give Borrower reasonable notice, which shall be at least five business days, prior to the date of the inspection. Borrower shall cooperate with Lender in making the Collateral and place of business available for inspection. During an examination of any Borrower place of business, Lender may examine, among other things, whether Borrower (i) has a place of business that is separate from any personal residence, (ii) is open for business, (iii) has sufficient inventory to conduct Borrower's business and (iv) has one or more credit card terminals if Borrower processes credit card transactions. When performing an examination, Lender may photograph the interior and exterior of any Borrower place of business, including any signage, and may photograph any individual who has signed the Agreement ("Signatory") unless the Signatory previously has notified Lender that he or she does not authorize Lender to photograph the Signatory. Lender may obtain testimonials from any Signatory, including testimonials on why Borrower needed the Line of Credit and how the Line of Credit has helped Borrower. Any photograph and testimonial will become and remain the sole property of Lender. Borrower and each Signatory grant Lender the irrevocable and permanent right to display and share any photograph and testimonial in all forms and media, including composite and modified representations, for all-purposes, including but not limited to any trade or commercial purpose, with any Lender employees and agents and with the general public. Lender may, but is not required to, use the name of any Borrower and Signatory as a credit in connection with any photograph and testimonial. Borrower and each Signatory waive the right to inspect or approve versions of any photograph or testimonial or the written copy or other media that may be used in connection with same. Borrower and each Signatory release Lender from any claims that may arise regarding the use of any photograph or testimonial, including any claims of defamation, invasion of privacy or infringement of moral rights, rights of publicity or copyright. |
Account: #37097035
BLUE SKY ELECTRIC, INC
| 25. | BORROWER'S REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants that: (i) Borrower will comply with all laws, statutes, regulations and ordinances pertaining to the conduct of Borrower’s business and promises to hold Lender harmless from any damages, liabilities, costs, expenses (including attorneys’ fees) or other harm arising out of any violation thereof; (ii) Borrower’s principal executive office and the office where Borrower keeps its records concerning its accounts, contract rights and other property, is that shown in the application; (iii) Borrower is duly organized, licensed, validly existing and in good standing under the laws of its state of formation and shall hereafter remain in good standing in that state, and is duly qualified, licensed and in good standing in every other state in which it is doing business, and shall hereafter remain duly qualified, licensed an din good standing in every other state in which it is doing business, and shall hereafter remain duly qualified, licensed and in good standing in every other state in which the failure to qualify or become licensed could have a material adverse effect on the financial condition, business or operations of Borrower; (iv) the true and correct legal name of the Borrower is set forth in the application; (v) the aggregate ownership percentages of the Signatories is greater than or equal to fifty percent (50%) of the Borrower’s business; (vi) the execution, delivery and performance of this Agreement, and any other document executed in connection herewith, are within Borrower’s powers, have been duly authorized, are not in contravention of law or the terms of Borrower’s charter, by-laws or other constating documents, or of any indenture, agreement or undertaking to which Borrower is a party; (vii) all constating documents and all amendments thereto of Borrower have been duly filed and are in proper order and any capital stock issued by Borrower and outstanding was and is properly issued and all books and records of Borrower are accurate and up to date and will be so maintained; (viii) Borrower (a) is subject to no charter, corporate or other legal restriction, or any judgment, award, decree, order, governmental rule or regulation or contractual restriction that could have a material adverse effect on its financial condition, business or prospects, and (b) is in compliance with its charter, by-laws, and other constating documents, all contractual requirements by which it may be bound and all applicable laws, rules and regulations other than laws, rules or regulations the validity or applicability of which it is contesting in good faith or provisions of any of the foregoing the failure to comply with which cannot reasonably be expected to materially adversely affect its financial condition, business or prospects or the value of the Borrower’s assets; (ix) there is no action, suit, proceeding or investigation pending or, to Borrower’s knowledge, threatened against or affecting it or any of its assets before or by any court or other governmental authority which, if determined adversely to it, would have a material adverse effect on its financial condition, business or prospects or the value of the Borrower’s assets; (x) Borrower does not intend to file for reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction within 6 months of the date hereof; and (xi) Borrower is not presently insolvent within the meaning of the Uniform Commercial Code as well as the United States Bankruptcy Code. |
| 26. | FEES. In addition to any other fees described in the Agreement or subsequently introduced by Lender, Borrower agrees to pay the following fees in full: |
| A. | Advance Fee: An Advance Fee may be charged when an Advance is funded. The amount of the Advance Fee, as a percentage of the amount of the Advance, will be disclosed to you at the time you request the Advance. Each time you obtain an Advance, Lender may charge an Advance Fee as a percentage of the Advance. |
| B. | Late Fee: A Late Fee in the amount set forth in the accompanying Business Line of Credit Agreement Supplement if a payment in full is not received by Lender as contemplated by the Payment Schedule. |
Payments made by Borrower hereunder will be applied and allocated between principal, interest, fees and other amounts owed hereunder in the manner set forth in Section 15.
| 27. | INTEREST AND FEES EXCEEDING PERMITTED LIMIT. If the Line of Credit is subject to a law that sets maximum charges, and that law is finally interpreted so that the interest or other fees collected or to be collected in connection with this Agreement exceed the permitted limits, then (i) any such charge will be reduced by the amount necessary to reduce the charge to the permitted limit and (ii) if required by applicable law, any sums already collected from Borrower that exceed the permitted limits will be refunded or credited to Borrower. |
| 28. | FINANCIAL INFORMATION AND REEVALUATION OF CREDIT. Borrower and each Guarantor (if any) authorize Lender to obtain business and personal credit bureau reports in Borrower's and any Guarantor's name, respectively, at any time and from time to time for purposes of deciding whether to approve the requested Line of Credit and any Advances made pursuant hereto or for any update, renewal, extension of credit or other lawful purpose, including for the purpose of account management. Upon Borrower's or any Guarantor's request, Lender will advise Borrower or Guarantor if Lender obtained a credit report and Lender will give Borrower or Guarantor the credit bureau's name and address. Borrower and each Guarantor (if any) agree to submit current financial information, a new credit application, or both, in Borrower's name and in the name of each Guarantor, respectively, at any time promptly upon Lender's request. Borrower authorizes Lender to act as Borrower's agent for purposes of accessing and retrieving transaction history information regarding Borrower from Borrower's designated merchant processor(s). Lender may at any time and from time to time, at Lender’s sole discretion and subject to any applicable notice requirements, increase or decrease the Credit Limit or the Applicable APR (in each case in the manner contemplated by the definitions thereof) or terminate this Agreement, to the extent not prohibited by applicable law. Lender may report Lender’s credit experiences with Borrower and any Guarantor to third parties as permitted by law, including with respect to any Guarantor to consumer credit reporting agencies. Borrower also agrees that Lender may release information to comply with governmental reporting or legal process that Lender believes may be required, whether or not such is in fact required, or when necessary or helpful in completing a transaction, or when investigating a loss or potential loss. Borrower and each Guarantor is hereby notified that a negative credit report reflecting on Borrower’s and/or any Guarantor’s credit record may be submitted to a credit reporting agency (including with respect to any Guarantor to consumer credit reporting agencies) if Borrower or such Guarantor fails to fulfill the terms of their respective credit obligations hereunder. Guarantor acknowledges that any credit reporting on the Loan shall be at the sole discretion of Lender (subject to applicable law) and that Lender has the right to report the Loan to Guarantor’s personal credit file should Guarantor not pay any Obligation pursuant to the guaranty set forth in this Agreement. |
Account: #37097035
BLUE SKY ELECTRIC, INC
| 29. | ATTORNEYS' FEES AND COLLECTION COSTS. To the extent not prohibited by applicable law, Borrower shall pay to Lender on demand any and all expenses, including, but not limited to, collection costs, all attorneys' fees and expenses, and all other expenses of like or unlike nature which may be expended by Lender to obtain or enforce payment of Obligations either as against Borrower or any Guarantor or surety of Borrower or in the prosecution or defense of any action or concerning any matter arising out of or connected with the subject matter of this Agreement, the Obligations, or any of Lender's rights or interests therein or thereto, including, without limiting the generality of the foregoing, any counsel fees or expenses incurred in any bankruptcy or insolvency proceedings, and all costs and expenses incurred by Lender in connection with the defense, settlement or satisfaction of any action, claim or demand asserted against Lender in connection therewith, which amounts shall be considered advances to protect Lender rights hereunder. To the extent permitted by applicable law, all such expenses will become a part of the Obligations and, at Lender's option, will be payable on demand. Such right shall be in addition to all other rights and remedies to which Lender may be entitled upon an Event of Default. |
| 30. | BORROWER'S REPORTS. Promptly upon Lender's written request, Borrower and each Guarantor agrees to provide Lender with such information about the financial condition and operations of Borrower or any Guarantor, as Lender may, from time to time, reasonably request. Borrower also agrees promptly upon becoming aware of any Event of Default, or the occurrence or existence of an event which, with the passage of time or the giving of notice or both, would constitute an Event of Default hereunder, to promptly provide notice thereof to Lender in writing. |
| 31. | TELEPHONE COMMUNICATIONS. Borrower and Guarantors hereby expressly consent to receiving calls and messages, including auto-dialed and pre-recorded and artificial voice message calls and SMS messages (including text messages) from Lender, its affiliates, marketing partners, agents and others calling at Lender's request or on its behalf (the "Messaging Parties"), at any telephone numbers that Borrower and/or Guarantors have provided or may provide in the future or otherwise in the Lender's possession (including any cellular or mobile telephone numbers). Borrower and Guarantor agree that such communications may be initiated using an automated telephone dialing system. Borrower and Guarantor further understand and acknowledge that they may incur a charge from the company that provides them with telecommunications, wireless and/or Internet services, and they agree that the Messaging Parties will have no liability for such charges. Borrower and Guarantor expressly authorize the Messaging Parties to monitor and record all calls with the Messaging Parties. |
| 32. | INDEMNIFICATION. Except for Lender's gross negligence or willful misconduct, Borrower will indemnify and hold Lender harmless from all losses, costs, damages, liabilities or expenses (including, without limitation, court costs and reasonable attorneys' fees) that Lender may sustain or incur by reason of enforcing the Obligations, or in the prosecution or defense of any action or proceeding concerning any matter arising out of or in connection with this Agreement and/or any other documents now or hereafter executed in connection with this Agreement and/or the Obligations. This indemnity shall survive the repayment of the Obligations and the termination of this Agreement. |
| 33. | MERGERS, CONSOLIDATIONS OR SALES. Borrower represents and agrees that Borrower will not (i) merge or consolidate with or into any other business entity or (ii) enter into any joint venture or partnership with any person, firm, corporation, or other entity. Borrower further agrees not to alter its ownership without prior written permission from Lender. |
| 34. | CHANGE IN LEGAL STATUS. Without Lender's consent, Borrower represents and agrees that Borrower will not (i) change its name, its place of business or, if more than one, chief executive office, its mailing address, or organizational identification number if it has one, or (ii) change its type of organization, jurisdiction of organization or other legal structure. If Borrower does not have an organizational identification number and later obtains one, Borrower shall promptly notify Lender of such organizational identification number. |
Account: #37097035
BLUE SKY ELECTRIC, INC
| 35. | DEFAULT. The occurrence of any one or more of the following events (herein, "Events of Default") shall constitute, without notice or demand, a default under this Agreement and all other agreements between Lender and Borrower and instruments and papers given Lender by Borrower, whether such agreements, instruments, or papers now exist or hereafter arise: (i) Lender is unable to collect any Automatic Payment Plan payment due on a scheduled payment date and for a subsequent business day thereafter and/or, Borrower fails to pay any Obligations when due for two consecutive business days; (ii) Borrower fails to comply with, promptly, punctually and faithfully perform, or observe any term, condition or promise within this Agreement; (iii) the determination by Lender that any representation or warranty heretofore, now or hereafter made by Borrower to Lender, in any documents, instrument, agreement, or paper was not true or accurate when given; (iv) the occurrence of any event such that any indebtedness of Borrower from any lender (other than the Lender) could be accelerated, notwithstanding that such acceleration has not taken place; (v) the occurrence of any event that would cause a lien creditor, as that term is defined in Section 9-102 of the Uniform Commercial Code, (other than Lender) to take priority over the Line of Credit made by Lender; (vi) a filing against or relating to Borrower (unless consented to in writing by Lender) of (a) a federal tax lien in favor of the United States of America or any political subdivision of the United States of America, or (b) a state tax lien in favor of any state of the United States of America or any political subdivision of any such state; (vii) the occurrence of any event of default under any other agreement between Lender and Borrower or instrument or paper given Lender by Borrower, whether such agreement, instrument, or paper now exists or hereafter arises (notwithstanding that Lender may not have exercised its rights upon default under any such other agreement, instrument or paper); (viii) any act by, against, or relating to Borrower, or its property or assets, which act constitutes the application for, consent to, or sufferance of the appointment of a receiver, trustee or other person, pursuant to court action or otherwise, over all, or any part of Borrower's property; (ix) the granting of any trust mortgage or execution of an assignment for the benefit of the creditors of Borrower, or the occurrence of any other voluntary or involuntary liquidation or extension of debt agreement for Borrower; (x) the failure by Borrower to generally pay the debts of Borrower as they mature; (xi) adjudication of bankruptcy or insolvency relative to Borrower or any Guarantor; (xii) the entry of an order for relief or similar order with respect to Borrower or any Guarantor in any proceeding pursuant to Title 11 of the United States Code entitled "Bankruptcy" (the "Bankruptcy Code") or any other federal bankruptcy law; (xiii) the filing of any complaint, application or petition by or against Borrower initiating any matter in which Borrower is or may be granted any relief from the debts of Borrower pursuant to the Bankruptcy Code or any other insolvency statute or procedure; (xiv) the calling or sufferance of a meeting of creditors of Borrower; (xv) the meeting by Borrower with a formal or informal creditor's committee; (xvi) the offering by or entering into by Borrower of any composition, extension or any other arrangement seeking relief or extension for the debts of Borrower, or the initiation of any other judicial or non-judicial proceeding or agreement by, against or including Borrower that seeks or intends to accomplish a reorganization or arrangement with creditors; (xvii) the entry of any judgment against Borrower, which judgment is not satisfied or appealed from (with execution or similar process stayed) within 15 days of its entry; (xviii) the occurrence of any event or circumstance with respect to Borrower or any Guarantor such that Lender shall believe in good faith that the prospect of payment of all or any part of the Obligations or the performance by Borrower under this Agreement or any other agreement between Lender and Borrower is impaired or there shall occur any material adverse change in the business or financial condition of Borrower (such event specifically includes, but is not limited to, taking additional financing from a credit card advance, cash advance company or an additional working capital loan without the prior written consent of Lender); (xix) the entry of any court order that enjoins, restrains or in any way prevents Borrower from conducting all or any part of its business affairs in the ordinary course of business; (xx) the occurrence of any uninsured loss, theft, damage or destruction to any material asset(s) of Borrower; (xxi) any act by or against, or relating to Borrower or its assets pursuant to which any creditor of Borrower seeks to reclaim or repossess or reclaims or repossesses all or a portion of Borrower's assets; (xxii) the termination of existence, dissolution or liquidation of Borrower or the ceasing to carry on actively any substantial part of Borrower's current business; (xxiii) this Agreement, at any time after its execution and delivery and for any reason, ceases to be in full force and effect or is declared null and void, or the validity or enforceability hereof is contested by Borrower or any Guarantor of Borrower denies it has any further liability or obligation hereunder; (xxiv) any Guarantor or person signing a support agreement in favor of Lender shall repudiate, purport to revoke or fail to perform his or her obligations under his guaranty or support agreement in favor of Lender or any corporate Guarantor shall cease to exist; (xxv) any material change occurs in Borrower's ownership or organizational structure (acknowledging that any change in ownership will be deemed material when ownership is closely held); (xxvi) if Borrower is a sole proprietorship, the owner dies; if Borrower is a trust, a trustor dies; if Borrower is a partnership, any general or managing partner dies; if Borrower is a corporation, any principal officer or 10% or greater shareholder dies; if Borrower is a limited liability company, any managing member dies; if Borrower is any other form of business entity, any person(s) directly or indirectly controlling 10% or more of the ownership interests of such entity dies. |
| 36. | RIGHTS AND REMEDIES UPON DEFAULT. Subject to applicable law, if an Event of Default occurs under this Agreement, at any time thereafter, Lender may exercise any one or more of the following rights and remedies: |
| A. | Refrain
from Making Advances and Terminate Borrower's Ability to Make Advance Requests: Lender may terminate the Line of Credit, refrain from making Advances and/or terminate Borrower's ability to make Advance Requests hereunder. |
Account: #37097035
BLUE SKY ELECTRIC, INC
| B. | Debit Amounts Due from Borrower’s Accounts: Lender may debit from Borrower’s Designated Checking Account all Automatic Payment Plan payments that Lender was unable to collect and/or the amount of any other Obligations that Borrower failed to pay. |
| C. | Accelerate Indebtedness: Lender may declare all amounts owed hereunder including, without limitation, all principal, accrued interest, other fees and expenses immediately due and payable, without presentment, demand, protest or notice of any kind to Borrower, all of which are hereby waived by Borrower, and may initiate ACH debit entries to the Designated Checking Account until all such amounts are paid in full. |
| D. | Other Rights and Remedies: Lender shall have and may exercise any and all rights and remedies that may be available at law, in equity or otherwise. |
| E. | Increase Interest Rate: Lender may immediately increase the Applicable APR in the manner contemplated by the definition thereof. |
| F. | Election of Remedies: Except as may be prohibited by applicable law, all of Lender's rights and remedies, whether evidenced by this Agreement, any related documents, or by any other writing, shall be cumulative and may be exercised singularly or concurrently. Election by Lender to pursue any remedy shall not exclude pursuit of any other remedy, and an election to make expenditures or to take action to perform an obligation of Borrower under the Agreement, after Borrower's failure to perform, shall not affect Lender's right to declare a default and exercise its remedies. |
| 37. | CONSENT TO JURISDICTION AND VENUE. Subject to Section 38 below, Borrower, Guarantors and Lender agree that any action or proceeding to enforce or arising out of this Agreement may be brought in any court of the State of Utah or in the United States District Court for the District of Utah, and Borrower and Guarantors waive personal service of process. Borrower, Guarantors and Lender agree that, subject to Section 38, venue is proper in such courts. |
| 38. | ARBITRATION PROVISION. THE PARTIES AGREE THAT AT THE ELECTION OF ANY PARTY, ALL CLAIMS BETWEEN BORROWER, GUARANTORS, LENDER, SHALL BE RESOLVED THROUGH MANDATORY BINDING INDIVIDUAL ARBITRATION PURSUANT TO THIS SECTION. |
| A. | General. Either you or we may elect to arbitrate or require the other party to arbitrate any Claim (as defined below) under the following terms and conditions. If you or we elect to arbitrate a Claim, neither you nor we will have the right to: (i) have a court or a jury decide the Claim; (ii) participate in a class action in court or in arbitration, either as a class representative or a class member; (iii) act as a private attorney general in court or in arbitration; or (iv) join or consolidate your Claim(s) with claims of any other person. The right to appeal and the right to discovery are more limited in arbitration than in court. Other rights that you would have if you went to court may also not be available in arbitration. |
| This Agreement evidences a transaction in interstate commerce, and thus the Federal Arbitration Act governs the interpretation and enforcement of this Arbitration Provision. |
| B. | Definitions. The following definitions apply to this Arbitration Provision, even if terms defined in this Arbitration Provision are defined differently or more narrowly elsewhere in this Agreement: |
| I. | "We", "us" and "our" mean Lender, its past, present, and future parents and affiliates, and the Lender's and each of those entities' agents, officers, employees, predecessors, successors, and assigns. These terms also include any party named as a codefendant with us in a Claim asserted by you, such as marketing companies, credit bureaus, credit insurance companies, servicers, and debt collectors. |
| II. | "You," "your" and "yours" mean each Borrower and each Guarantor signing this agreement, as well as all authorized or unauthorized users or beneficiaries of this Agreement or the Line of Credit. If the Borrower or Guarantor is a business, these terms also include its parents, subsidiaries, affiliates, predecessors, successors, assigns, and the Borrower's or Guarantor's and each of those entities' agents, officers, employees, successors, and assigns, and any person purporting to act on behalf of Borrower or Guarantor(s). |
| III. | "Administrator" means the American Arbitration Association ("AAA"), 1633 Broadway, 10th Floor, New York, NY 10019, www.adr.org. If AAA cannot or will not administer the arbitration consistent with this Section, then another Administrator will be selected by agreement of the parties or, if there is no agreement, by a court. |
| IV. | "Claim" means any claim, dispute or controversy between you and us that in any way arises from or relates to your transactions with us, account, this Agreement or the Business Line of Credit, including disputes arising from actions or omissions prior to the date of this Agreement, or any application(s) that you have submitted to us for credit. "Claim" has the broadest reasonable meaning, and includes initial claims, counterclaims, cross-claims and third-party claims. It includes disputes based upon contract, tort, consumer rights, fraud and other intentional torts, constitution, statute, regulation, ordinance, common law and equity (including any claim for injunctive, declaratory or equitable relief). And it includes disputes over such matters as claims relating to fees, balances, communications with you regarding your relationship with us or our other products and services, your application and/or any transaction that you engage with us and the protection, security, and disclosure of information about you. However, the term "Claim" does not include disputes about the validity, enforceability, coverage or scope of this Arbitration Provision or whether a dispute can or must be arbitrated. Nor does "Claim" include disputes about whether subsections (e) (Starting Arbitration) or (f) (Requirement of Individual Arbitration) has been complied with or violated, unless the parties expressly request that an arbitrator (including a process arbitrator) decide those disputes. |
Account: #37097035
BLUE SKY ELECTRIC, INC
| C. | Electing Arbitration: Either You or We may elect arbitration of any Claim, including by filing a motion to compel arbitration in a lawsuit filed in court. You and We agree that filing a lawsuit asserting a Claim does not waive the right to elect arbitration of any counterclaims, cross-claims, or third-party claims. |
| D. | Starting Arbitration. An arbitration proceeding cannot be commenced until there is compliance with the Pre-Dispute Notification Section of the Agreement (if applicable). A court will have authority to enforce this subsection, including the power to enjoin the filing or prosecution of arbitrations without first compliance with the Pre-Dispute Notification Section of the Agreement. The court also may enjoin the assessment or collection of arbitration fees incurred as a result of such arbitrations. Further, unless prohibited by applicable law, the Administrator shall not accept nor administer any arbitration nor assess any fees unless the claimant has complied with the Pre-Dispute Notification Section requirement of Section 41 of the Agreement. If a process arbitrator has been appointed at the request of a party, the process arbitrator also has the same authority as a court to enforce this subsection. |
| E. | Requirement of Individual Arbitration. The arbitrator may award relief (including monetary, declaratory, or injunctive relief) only in favor of the individual party seeking relief and only to the extent necessary to provide relief warranted by that party's individual claim. YOU AND WE AGREE THAT EACH MAY BRING CLAIMS AGAINST THE OTHER ONLY IN YOUR OR OUR INDIVIDUAL CAPACITY, AND NOT AS A PLAINTIFF OR CLASS MEMBER IN ANY PURPORTED CLASS, REPRESENTATIVE, OR PRIVATE ATTORNEY GENERAL PROCEEDING. Further, unless both you and we agree otherwise, the arbitrator may not consolidate the claims of more than one person (except for the claims of co- or joint account owners pertaining to that account), and may not otherwise preside over any form of a representative, class, or private attorney general proceeding. If, after exhaustion of all appeals, any of the prohibitions in this subsection are found to be unenforceable with respect to a particular claim or with respect to a particular request for relief (such as a request for injunctive relief), then that claim or request for relief shall be severed and decided by a court after all other claims and requests for relief are arbitrated. |
| F. | Arbitration Procedure: Any arbitration will be governed by the Administrator's Commercial Arbitration Rules ("Administrator Rules"), as modified by this Arbitration Provision. (The AAA's rules for commercial arbitrations are available online at adr.org or by writing to the Notice Address.) As in court, you and we agree that any counsel representing someone in arbitration certifies that they will comply with the requirements of Federal Rule of Civil Procedure 11(b), including a certification that the claim or the relief sought is neither frivolous nor brought for an improper purpose. The arbitrator is authorized to impose any sanctions available under that rule, the Administrator Rules, or applicable federal or state law against all appropriate represented parties and counsel. |
| The arbitrator may conduct the proceedings through an in-person hearing, by telephone or videoconference, as permitted by the Administrator Rules. Either party also shall have the right to file dispositive motions, such as motions to dismiss or for summary judgment. Any in-person hearings shall take place in the State of Utah, unless the parties agree otherwise, or if applicable law requires otherwise. Except as provided in subsection (E) (Requirement of Individual Arbitration), and subject to Section 51 of this Agreement (Governing Law), the arbitrator shall apply the same substantive law that a court would apply and can award the same individualized remedies that a court could award under applicable law, but shall not award punitive or exemplary damages. The arbitrator may consider rulings in arbitrations involving other customers of Headway, but an arbitrator's ruling is not binding in proceedings involving other customers. Upon the timely request of either party, the arbitrator shall write a brief explanation of the basis of his or her award. |
Account: #37097035
BLUE SKY ELECTRIC, INC
| G. | Arbitrator Selection. Once an arbitration has been properly filed, the Administrator will send the parties a list of three potential arbitrators, each of whom must be a retired or former judge or a lawyer with at least 10 years’ experience. Unless the parties agree otherwise, each party may strike one candidate, and the remaining candidate will be appointed arbitrator. |
| H. | Arbitration Costs: The Administrator's Commercial Arbitration Rules and fee schedule will govern the payment and allocation of all fees charged by the Administrator, including filing. administration, case management, hearing, and arbitrator fees (collectively "Administrator Fees"). If you cannot afford your share of the Administrator Fees (and the Administrator will not waive those fees), we will consider in good faith any request to pay those fees for you, and will pay them to the extent required to make this Arbitration Provision enforceable. If, however, the arbitrator finds that you violated the standards set forth in Federal Rule of Civil Procedure 11(b), then the allocation and payment of all Administrator Fees will be governed by the Administrator Rules, and you agree to reimburse us for all monies previously disbursed that are otherwise your obligation to pay. |
| I. | Survival, Severability, Primacy. This Arbitration Provision shall survive the termination of this Agreement, your fulfillment or default of your Obligations under this Agreement and/or your or our bankruptcy or insolvency (to the extent permitted by applicable law). In the event of any conflict or inconsistency between this Arbitration Provision and the Administrator's Rules or this Agreement, this Arbitration Provision will govern. Except as specified in subsection (f), if any portion of this Arbitration Provision is deemed invalid or unenforceable, the remaining portions shall nevertheless remain in force. |
| J. | Amendment/Termination. Notwithstanding any provision of this Agreement to the contrary, we will not amend this Arbitration Provision in a manner that adversely affects your rights or responsibilities in a material manner unless we give you a right to reject the amendment and/or the Arbitration Provision in its entirety. |
| K. | Application. The provisions of this Arbitration Provision are intended to benefit, apply to, and bind certain third party non-signatories, including any assignee of the Agreement. The provisions of this Arbitration Provision shall continue in full force and effect subsequent to and notwithstanding the termination of this Agreement. |
| 39. | CLASS ACTION WAIVER. Except as otherwise prohibited by applicable law, unless Borrower, Guarantor and Lender agree otherwise, any lawsuit between Borrower and/or Guarantor and Lender (including, but not limited to Lender's employees, officers, agents, successors, and assigns) must be resolved on an individual basis only, and not as part of a class action or on a consolidated basis. Thus, neither Borrower and/or Guarantor nor Lender may bring or participate in a class or consolidated action, either as a plaintiff, defendant, representative, or class member. This provision is not applicable to a class action settlement approved by a court. |
| 40. | TIME TO BRING LEGAL ACTION. Unless another time is provided in another provision of this Agreement or is required by applicable law, an action or proceeding by Borrower or Guarantor to enforce an obligation, duty, or right arising under this Agreement or under applicable law with respect to the account or this Agreement must be commenced within one year after the cause of action accrues. |
| 41. | PRE-DISPUTE NOTIFICATION. Prior to bringing any Claim (as that term is defined in Section 38), Borrower and/or Guarantor shall provide Lender written notification of any alleged Claim (the "Notice"), and must provide Lender an opportunity to cure. The Notice shall (1) identify the alleged Claim, including a description of the underlying facts and legal basis of the Claim; (2) provide a statement as to the action requested to correct or cure the issue giving rise to the alleged Claim; and (3) provide a date, which shall be no less than 30 days from the date of the written notification, by which the corrective action must be taken. The Notice shall further include Borrower and/or Guarantor's email address and phone number and, if sent by counsel for Borrower and/or Guarantor, shall include an authorization executed by Borrower and/or Guarantor authorizing Lender to speak to the attorney who executed the Notice. Borrower and/or Guarantor must reasonably cooperate in providing Lender any information requested by the Lender to resolve any Pre-Dispute Notification. Any Notice by Borrower or Guarantor to Lender must be sent via certified or registered mail (or through a nationally recognized private carrier that tracks such correspondence, such as UPS or FedEx) at the following address: Headway Capital, ATTN: Legal Department, 175 West Jackson Blvd., Suite 600, Chicago, IL 60604. |
| 42. | JURY TRIAL WAIVER. Subject to Section 38, and to the extent not prohibited by applicable law, Borrower, Guarantors and Lender waive their right to a trial by jury of any claim or cause of action based upon, arising out of or related to the Agreement and all other documentation evidencing the Obligations, in any legal action or proceeding. Subject to Section 38, any such claim or cause of action shall be tried by court sitting without a jury. |
| 43. | NO WAIVER BY LENDER. No delay or omission on the part of Lender in exercising any rights under this Agreement, any related guaranty or applicable law shall operate as a waiver of such right or any other right. Waiver on any one occasion shall not be construed as a bar to or waiver of any right or remedy on any future occasion. All Lender’s rights and remedies, whether evidenced hereby or by any other agreement, instrument or paper, shall be cumulative and may be exercised singularly or concurrently. |
Account: #37097035
BLUE SKY ELECTRIC, INC
| 44. | TERMINATION. Borrower may terminate this Agreement by giving at least 30 days prior written notice to Lender of Borrower's intention to do so; provided that this Agreement shall not terminate until Borrower has paid in full all amounts owed hereunder including, without limitation, all principal, interest, other fees and expenses. In addition to Lender's rights and remedies set forth herein, Lender may, at any time and subject to applicable law, terminate this Agreement; provided that the Borrower will continue to be obligated to pay all amounts owing under the Line of Credit (including, without limitation, the Total Outstanding Principal Amount, the Unpaid Interest Outstanding, and any and all other amounts owed hereunder, in each case as set forth in the Lender's books and records) and to otherwise perform the Obligations. |
| 45. | ASSIGNMENT. This Agreement shall bind and inure to the benefit of the respective successors and assigns of each of the parties hereto; provided, however, that Borrower may not assign this Agreement or any rights or duties hereunder without Lender's prior written consent and any prohibited assignment shall be absolutely null and void. No consent to an assignment by Lender shall release Borrower from its Obligations. Lender may assign this Agreement and its rights and duties hereunder and no consent or approval by Borrower is required in connection with any such assignment. Lender reserves the right to sell, assign, transfer, negotiate or grant participations in all or any part of, or any interest in Lender's rights and benefits hereunder. In connection with any assignment or participation, Lender may disclose all documents and information that Lender now or hereafter may have relating to Borrower or Borrower's business. To the extent that Lender assigns its rights and obligations hereunder to another party, Lender thereafter shall be released from such assigned obligations to Borrower and such assignment shall affect a novation between Borrower and such other party. For the avoidance of doubt, Borrower, Guarantors and Lender and their successors or assigns retain the right to compel arbitration under Section 38 even if they assign any rights under this Agreement to another individual or entity. |
| 46. | INTERPRETATION. Paragraph and section headings used in this Agreement are for convenience only, and shall not affect the construction of this Agreement. Neither this Agreement nor any uncertainty or ambiguity herein shall be construed or resolved against Lender or Borrower, whether under any rule of construction or otherwise. On the contrary, this Agreement has been reviewed by all parties and shall be construed and interpreted according to the ordinary meaning of the words used so as to fairly accomplish the purposes and intentions of all parties hereto. |
| 47. | SEVERABILITY. If one or more provisions of this Agreement (or the application thereof) is determined invalid, illegal or unenforceable in any respect in any jurisdiction, the same shall not invalidate or render illegal or unenforceable such provision (or its application) in any other jurisdiction or any other provision of this Agreement (or its application). |
| 48. | NOTICES. Except as otherwise provided in this Agreement, notice under this Agreement must be in writing. Notices will be deemed given when deposited in the U.S. mail, postage prepaid, first class mail; when delivered in person; or when sent by registered mail; by certified mail; by nationally recognized overnight courier, or when sent by electronic mail. Notice to Borrower and/or any personal guarantor will be either posted to Borrower's Online Account or sent to Borrower's last known address, or electronic mail address in Lender's records for Borrower. Any notice posted to the Online Account by Lender shall be deemed given when posted in the Online Account. Notice to Lender may be sent to: Headway Capital, LLC, 4700 W. Daybreak Pkwy., Suite 200, South Jordan, UT 84009, Attn: Director of Operations. |
| 49. | RECORDKEEPING AND AUDIT REQUIREMENTS. Lender shall have no obligation to maintain any electronic records or any documents, schedules, invoices or any other paper delivered to Lender by Borrower in connection with this Agreement or any other agreement other than as required by law. Borrower will at all times keep accurate and complete records of Borrower's assets (including without limitation accounts). At Lender's request, Borrower shall deliver to Lender: (i) schedules of its assets (including without limitation accounts) and assets; and (ii) such other information regarding its assets (including without limitation accounts) as Lender shall request. Lender, or any of its agents, shall have the right to call at any telephone numbers that Borrower has provided or may provide in the future or otherwise in the Lender's possession (including any cellular or mobile telephone numbers), at intervals to be determined by Lender, and without hindrance or delay, to inspect, audit, check, and make extracts from any copies of the books, records, journals, orders, receipts, correspondence that relate to Borrower's assets (including without limitation accounts) or other transactions between the parties thereto and the general financial condition of Borrower and Lender may remove any of such records temporarily for the purpose of having copies made thereof. If Borrower was referred to Lender for the Line of Credit by a third party (the "Referring Party"), then Borrower consents to Lender sharing certain reasonable information about Borrower with the Referring Party for purposes of the Referring Party verifying and/or auditing accounts made through such Referring Party's referrals. |
Account: #37097035
BLUE SKY ELECTRIC, INC
| 50. | CHANGE IN TERMS. Lender may at any time change or remove any of the terms and conditions of, or add new terms or conditions to, this Agreement. Lender will notify Borrower of such a change by posting or otherwise reflecting such change in the Online Account, and/or by providing Borrower with notice of the change in terms pursuant to the notice provision in Section 48 of this Agreement. To the extent not prohibited by applicable law, such changes shall become effective immediately except where this Agreement expressly contemplates that such change shall only become effective as of the immediately succeeding Advance Request. Further, to the extent not prohibited by applicable law, any such changes or new terms will apply to the Total Outstanding Principal Amount. Borrower may request a change or a new term that Lender may, at Lender’s option, accept and such change or new term shall be binding on Lender and Borrower only if agreed to in a writing signed by Lender. |
| 51. | GOVERNING LAW. Subject to Section 38 above, our relationship (including this Agreement and any claim, dispute or controversy (whether in contract, tort, or otherwise) at any time arising from or relating to this Agreement) is governed by, and this Agreement will be construed in accordance with, applicable federal law and (to the extent not preempted by federal law) Utah law without regard to internal principles of conflict of laws. The legality, enforceability and interpretation of this Agreement and the amounts contracted for, charged and reserved under this Agreement will be governed by such laws. Borrower understands and agrees that (i) Lender is located in Utah, (ii) Lender makes all credit decisions from Lender's office in Utah, (iii) the Line of Credit (including, for the avoidance of doubt, any and all Advances) are made in Utah (that is, no binding contract will be formed until Lender receives and accepts Borrower's signed Agreement in Utah) and (iv) Borrower's payments are not accepted until received by Lender in Utah. |
| 52. | WAIVER OF NOTICES AND OTHER TERMS. Except for any notices provided for in this Agreement, Borrower and any person who has obligations pursuant to this Agreement (e.g., a Guarantor), to the extent not prohibited by applicable law, hereby waives demand, notice of nonpayment, notice of intention to accelerate, notice of acceleration, presentment, protest, notice of dishonor and notice of protest. To the extent permitted by applicable law, Borrower and any person who has obligations pursuant to this Agreement also agrees: (i) Lender is not required to file suit, show diligence in collection against Borrower or any person who has obligations pursuant to this Agreement; and (ii) Lender may, but will not be obligated to, sue one or more persons without joining or suing others. |
| 53. | MONITORING, RECORDING AND ELECTRONIC COMMUNICATIONS. In order to ensure a high quality of service for Lender's customers, Lender may monitor and/or record telephone calls between Borrower and Lender's employees or agents. Borrower acknowledges that Lender may do so and agrees in advance to any such monitoring or recording of telephone calls. Borrower also agrees that Lender may communicate with Borrower electronically by e-mail or via the Borrower's Online Account. |
| 54. | ENTIRE AGREEMENT. Any application Borrower signed or otherwise submitted in connection with this Agreement, the accompanying Business Line of Credit Agreement Supplement and the Authorization Agreement for Direct Deposits (ACH Credits) and Direct Payments (ACH Debits) and any other documents required by Lender now or in the future in connection with this Agreement and Borrower's Line of Credit and/or Online Account are hereby incorporated into and made a part of this Agreement. This Agreement is the entire agreement of the parties with respect to the subject matter hereof and supersedes any prior written or verbal communications or instruments relating thereto. |
| 55. | COUNTERPARTS; ELECTRONIC SIGNATURES. This Agreement may be executed in one or more counterparts, each of which counterparts shall be deemed to be an original, and all such counterparts shall constitute one and the same instrument. For purposes of the execution of this Agreement, signatures delivered by electronic or fax transmission shall be treated in all respects as original signatures. |
| 56. | CUSTOMER SERVICE CONTACT INFORMATION. If you have questions or comments about your Online Account, you may contact us by (i) e-mail at [email protected], (ii) telephone at (866) 698-8494 or (iii) mail at 4700 W. Daybreak Pkwy., Suite 200, South Jordan, UT 84009, Attn: Director of Operations. |
| 57. | PERSONAL GUARANTY. Each Guarantor, jointly and severally (if more than one), absolutely and unconditionally guarantee the prompt payment to Lender, including its successors and assignees, of any and all Obligations incurred by the Borrower pursuant to the Agreement (this "Personal Guaranty"). Each Guarantor further agrees to repay the Obligations on demand, without requiring Lender first to enforce payment against Borrower. This is a guarantee of payment and not of collection. This is an absolute, unconditional, primary, and continuing obligation and will remain in full force and effect until the first to occur of the following: (a) all of the Obligations have been indefeasibly paid in full, and Lender has terminated this Personal Guaranty, or (b) 30 days after the date on which written notice of revocation is actually received and accepted by Lender. No revocation will affect: (i) the then existing liabilities of the revoking Guarantor under this Personal Guaranty; (ii) Obligations created, contracted, assumed, acquired or incurred prior to the effective date of such revocation; (iii) Obligations created, contracted, assumed, acquired or incurred after the effective date of such revocation pursuant to any agreement entered into or commitment obtained prior to the effective date of such revocation; or (iv) any Obligations then or thereafter arising under the agreements or instruments then in effect and then evidencing the Obligations. Each Guarantor represents and warrants that (i) it is a legal resident of the United States of America and (ii) neither Borrower, nor itself individually as Guarantor, intends to file for reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction within 6 months of the date hereof. Each Guarantor waives all notices to which the Guarantor might otherwise be entitled by law, and also waives all defenses, legal or equitable, otherwise available to the Guarantor. This Personal Guaranty shall be construed in accordance with the laws of the State of Utah, and shall inure to the benefit of Lender, its successors and assigns. To the extent not prohibited by applicable law, each of the undersigned Guarantors waives its right to a trial by jury of any claim or cause of action based upon, arising out of or related to this Personal Guaranty, the Agreement and all other documentation evidencing the Obligations, in any legal action or proceeding. Subject to Section 38, any such claim or cause of action shall be tried by court sitting without a jury. |
Account: #37097035
BLUE SKY ELECTRIC, INC
| 58. | CERTIFICATION AND SIGNATURES. By executing this Agreement or authorizing the person signing or affirming below to execute on its behalf, Borrower certifies that Borrower has received a copy of this Agreement and that Borrower has read, understood and agreed to be bound by its terms. Each person executing certifies that each person is executing on behalf of the Borrower and/or in the capacity indicated (and if Borrower is a sole proprietorship, in the capacity of the owner of such sole proprietorship) and that such person is authorized to execute this Agreement on behalf of or in the stated relation to Borrower. |
Use of Proceeds Certification
As referred to in Section 6, by signing below, the Borrower certifies, acknowledges and understands that the proceeds from the requested Line of Credit (including, for the avoidance of doubt, any and all Advances) will be used solely for the following purposes only:
○ specified merchandise
○ insurance (but not self insurance programs)
○ services or equipment
○ inventory or other specified goods
○ loans to finance specified sales transactions
○ public works projects or educational services (e.g., training)
Authorization Agreement for Direct Deposit (ACH) and Direct Payments (ACH Debits)
This Authorization Agreement for Direct Deposit (ACH Credit) and Direct Payments (ACH Debits) is part of (and incorporated by reference into) the Business Line of Credit Agreement. Borrower should keep this important legal document for Borrower's records.
DISBURSEMENT OF LOAN PROCEEDS. By executing this Authorization Agreement for Direct Deposit (ACH Credit) and Direct Payments (ACH Debits), Borrower authorizes Lender to disburse Advance proceeds (less the amount of any applicable fees) by initiating an ACH credit, wire transfer or similar means to the checking account Borrower provided to Lender through Lender's Online Portal (or a substitute checking account Borrower later identifies and is acceptable to Lender) (hereinafter referred to as the "Designated Checking Account"). This authorization is to remain in full force and effect until Lender has received written notification from Borrower of its termination in such time and in such manner as to afford Lender and Borrower's depository bank a reasonable opportunity to act on it.
AUTOMATIC PAYMENT PLAN. Enrollment in Lender's Automatic Payment Plan is required for Line of Credit approval. By executing this Authorization Agreement for Direct Deposit (ACH Credit) and Direct Payments (ACH Debits), Borrower agrees to, and hereby, enrolls in the Automatic Payment Plan and authorizes Lender to collect payments required under the terms of Borrower's Business Line of Credit Agreement by initiating ACH debit entries to the Designated Checking Account in the amounts and on the dates provided in the Payment Schedule and/or the Modified Payment Schedule set forth in the accompanying Business Line of Credit Agreement and/or for any and all amounts when due thereunder. Borrower authorizes Lender to resubmit any returned or failed ACH Debt for any previously scheduled payment(s) that was not paid as provided in the Payment Schedule, as permitted by law and network rules. This authorization is to remain in full force and effect until Lender has received written notification from Borrower of its termination no less than three business days before a scheduled payment. Lender may suspend or terminate Borrower's enrollment in the Automatic Payment Plan immediately if Borrower fails to keep Borrower's designated checking account in good standing or if there are insufficient funds in Borrower's checking account to process any payment (or if Lender is otherwise unable to collect any amounts by ACH debit owed to Lender under the Loan or under any other loan or extension of credit by Lender to Borrower). If Borrower revokes the authorization or Lender suspends or terminates Borrower's enrollment in the Automatic Payment Plan, Borrower still will be responsible for making timely payments pursuant to the alternative payment methods described in the Business Line of Credit Agreement.
Account: #37097035
BLUE SKY ELECTRIC, INC
ACH Authorization for Material Misrepresentations. In the event that we determine that you made any material misrepresentation in your application (including, but not limited to, misrepresenting your business revenue, altering bank statements, misrepresenting the purpose of the funds, etc.) you authorize Lender to debit the Designated Checking Account the full Total Outstanding Principal Amount that Lender has advanced and to close the Line of Credit. In the event that Lender exercises this option and debits the Total Outstanding Principal Amount from your Designated Checking Account, you agree that all other terms of the Business Line of Credit Agreement, including the Arbitration Agreement and Class Action Waiver, shall remain in full force and effect.
BUSINESS PURPOSE ACCOUNT. By executing this Authorization Agreement for Direct Deposit (ACH Credit) and Direct Payments (ACH Debits), Borrower attests that the Designated Checking Account was established for business purposes and not primarily for personal, family or household purposes.
ACCOUNT CHANGES. Borrower agrees to promptly notify Lender in writing if there are any changes to the account and routing numbers of the Designated Checking Account.
MISCELLANEOUS. Lender is not responsible for any fees charged by Borrower's bank as the result of credits or debits initiated under this agreement. The origination of ACH transactions to Borrower's account must comply with the provisions of U.S. law.
By ticking the box and by clicking or allowing any other signer to click the "Agree and Continue" button, or by expressing your agreement in replying to an email we send you with a copy of this agreement attached, you agree to all of the terms of this agreement on behalf of the entities and persons listed as borrower, and you acknowledge that you have read and understand this entire agreement, including but not limited to: (1) the promise that all advances will be for the business purposes described in the Use of Proceeds Certification in Section 58; (2) the Authorization Agreement for Direct Deposit (ACH Credit) and Direct Payments (ACH Debits); (3) the Class Action Waiver (section 39); and (4) the arbitration provision (section 38).
You agree that ticking a box on behalf of any other person, or replying to an email sent to any other person, without such person's express consent, constitutes fraud.
By ticking the box and by clicking or allowing any other signer to click the "Agree and Continue" button, or by expressing your agreement in replying to an email we send you with a copy of this agreement attached, you agree to all of the terms of the personal guaranty set forth in Section 57 of this agreement, whereby you, acting in your personal capacity and not on behalf of the borrower, guarantee and become liable to lender for all of the borrower's payment and performance obligations under this agreement, and you acknowledge that you have read and understand this entire agreement, including but not limited to: (1) the promise that all advances will be for the business purposes described in the application as stated in the Use of Proceeds Certification in Section 58; (2) The Class Action Waiver (section 39); and (3) the arbitration provision (section 38).
You agree that ticking a box on behalf of any other person, or replying to an email sent to any other person, without such person's express consent, constitutes fraud. |
Account: #37097035
BLUE SKY ELECTRIC, INC
| Signature block:
Signed At: 02:57 PM on October 24, 2025
Connected From: 174.168.169.66
Signed on behalf of Borrower: Mahesh Choudhury
Signed as Guarantor: Mahesh Choudhury
Contract: {SHA} 753801d280e316edf6ab4428ae8de54457c04ef3
ACH Authorization: {SHA} c9de7032da487e23eb06fded5668e3f0664f0107
|
Headway Signature Block:
BY AFFIXING THE FACSIMILE SIGNATURE OF ITS DULY AUTHORIZED OFFICER, HEADWAY CAPITAL, LLC HEREBY AGREES TO THE TERMS OF THIS AGREEMENT.
Signed at: 12:15 AM on October 27, 2025
Signed by: Stacey Sulken, Senior Lead - SMB Underwriting, Headway Capital
Headway: {SHA} c6df7f4ce64f81f01f7eb616416f6a8f44794b02 |
Headway Capital, LLC. | 4700 W. Daybreak Pkwy., Suite 200 | South Jordan, UT 84009
California Residents: Headway Capital California License Lender No. 60DBO 44216.
Exhibit 10.7
REVENUE PURCHASE AGREEMENT
This Revenue Purchase Agreement and Security Agreement and Guaranty of Performance together with appendices attached hereto (the “Revenue Purchase Agreement”, the “Agreement”) dated 11/04/2025 between NewCo Capital Group® VI LLC, (“Funder”), having an address at 333 W Commercial Street, Suite 324, East Rochester, NY 14445, the Merchant(s) listed below (“Merchant”) and the Individual(s) listed below (“Guarantor”)
MERCHANT INFORMATION
Merchant’s Legal name
BOURQUE HEATING & COOLING CO., INC. and entities listed in Appendix B
Type of Entity (Corp / LLC / Sole Prop / Other): CORP State of Incorporation / Organization MASSACHUSETTS
| DBA | BOURQUE HEATING & COOLING |
| Physical Address | 1199 PITCHERS WAY |
| City | HYANNIS | State | MASSACHUSETTS | Zip | 02601 |
| Guarantor(s) Name | BHASKAR CHANDRA PANIGRAHI | Business Phone | 508-790-2887 |
| Cell Phone Number | 508-479-8450 | Email Address | [email protected] |
| Mailing Address | 1199 PITCHERS WAY |
| City | HYANNIS | State | MASSACHUSETTS | Zip | 02601 |
| Purchase Price | Remittance Percentage | Purchased Amount | Payment Frequency | Remittance | Merchant’s Average Monthly Revenue | ||||||||||||||||
| $ | 150,000.00 | 9 | % | $ | 201,000.00 | WEEKLY | $ | 5,025.00 | $ | 240,000.00 | |||||||||||
THIS AGREEMENT INCLUDES AN ARBITRATION AGREEMENT AND CLASS ACTION WAIVER. PLEASE READ IT CAREFULLY.
In consideration of payment by Funder to Merchant of the Purchase Price set forth above, Merchant hereby sells, assigns and transfers to Funder (making Funder the absolute owner) all of the payments, receipts, settlements and funds paid to or received by or for the account of Merchant from time to time on and after the date hereof in payment or settlement of Merchant’s existing and future accounts, payment intangibles, credit, debit and/or stored value card transactions, contract rights and other entitlements arising from or relating to the payment of monies from Merchant’s customers’ and/or other payors or obligors (the “Future Receipts” or “Receipts” are defined as all payments made by cash, check, clearinghouse settlement, electronic transfer or other form of monetary payment), for the payments to Merchant as a result of Merchant’s sale of goods and/ or services (the “Transactions”) until the Purchased Amount has been delivered by or on behalf of Merchant to Funder.
| Initial | /s/ BCP |
1
Merchant is selling a future revenue stream to Funder at a discount, and is not borrowing money from Funder, therefore there is no interest rate or payment schedule and no time period during which the Purchased Amount must be collected by Funder. The Remittance is a good faith estimate of periodic payments to be made to Funder based on the Remittance Percentage and the financial and Average Monthly Revenue information provided by Merchant, which financial information, Average Monthly Revenue and the Remittance estimate Merchant hereby confirms to be correct and accurate. Merchant going bankrupt or going out of business, or experiencing a slowdown in business, or a delay in collecting its receivables, in and of itself, does not constitute a breach of this Agreement. Funder is entering this Agreement knowing the risks that Merchant’s business may not perform as expected or fail, and Funder assumes these risks based on Merchant’s representations, warranties and covenants in this Agreement, which are designed to give Funder a reasonable and fair opportunity to receive the benefit of its bargain. Funder acknowledges that it may never receive the Purchased Amount in the event that the Merchant does not generate sufficient revenue. Merchant and Guarantor(s)(s) are only guaranteeing their performance of the terms of this Revenue Purchase Agreement, and are not guaranteeing the payment of the Purchased Amount. The initial Remittance shall be as described above. The Remittance is subject to adjustment as set forth in Section 1.3 and Section 1.4.
Funder will debit the Remittance on the Payment Frequency as set forth in this Agreement from only one depositing bank account, which account must be acceptable to, and pre-approved by, Funder (the “Account”) into which Merchant and Merchant’s customers shall remit the Receipts from each Transaction, until such time as Funder receives payment in full of the Purchased Amount. Merchant hereby authorizes Funder to ACH debit the agreed Remittance from the Account on the agreed upon Payment Frequency; a daily basis means any day that is not a United States banking holiday, provided that Funder may collect twice the Remittance amount on the date following such banking holiday; a weekly basis means on the first day of the week that is not a United States banking holiday unless parties agree in writing on the other day of the week; Funder may alter the Payment Frequency from weekly to daily upon Event of Default or missed Remittance. The first Remittance amount on the weekly basis may be prorated based on the number of days between the Purchase Price payment date and the payment date of the first Remittance on the weekly basis. Merchant agrees not to make or cause debits to the Account (other than in favor of Funder) at any time that would cause the balance therein on any business day to be insufficient to fund payment in full of the agreed Remittance. The Account may not be used for any personal, family or household purposes. Merchant will provide Funder with all required access codes and monthly bank statements regarding the Account so that Funder may monitor the Account. The terms herein do not create a binding agreement and only Funder’s payment of the Purchase Price shall be deemed the acceptance and performance by Funder of this Agreement. Any subsequent draft agreement sent by Funder prior to payment of the Purchase Price supersedes, replaces, cancels and withdraws this Agreement. Merchant understands that it is responsible for ensuring that the agreed Remittance to be debited by Funder remains in the Account and will be held responsible for any fees incurred by Funder resulting from a rejected ACH attempt or an Event of Default. Funder is not responsible for any overdrafts or rejected transactions that may result from Funder’s ACH debiting the agreed Remittance under the terms of this Agreement. Notwithstanding anything to the contrary in this Agreement or any other agreement between Funder and Merchant, upon the occurrence of an Event of Default under this Agreement, the Remittance Percentage shall equal 100%. A list of all fees applicable under this Agreement is contained in Appendix A.
THE SECURITY AGREEMENT AND GUARANTY OF PERFORMANCE ARE HEREBY INCORPORATED IN AND MADE A PART OF THIS REVENUE PURCHASE AGREEMENT.
| FOR THE MERCHANT (#1) By: | FOR THE MERCHANT (#2) By: | |
| BHASKAR CHANDRA PANIGRAHI | ||
| Print Name and Title | Print Name and Title | |
| /s/ BHASKAR CHANDRA PANIGRAHI | ||
| Signature | Signature | |
| BY GUARANTOR(S) (#1) By: | BY GUARANTOR(S) (#2) By: | |
| BHASKAR CHANDRA PANIGRAHI | ||
| Print Name and Title | Print Name and Title | |
| /s/ BHASKAR CHANDRA PANIGRAHI | ||
| Signature | Signature |
| Initial | /s/ BCP |
2
TERMS AND CONDITIONS
1 TERMS OF ENROLLMENT IN PROGRAM
1.1 Merchant Deposit Agreement and Processor. Merchant shall (a) execute an agreement acceptable to Funder with a bank acceptable to Funder to obtain electronic fund transfer services for the Account, and (b) if applicable, execute an agreement acceptable to Funder with a credit and debit card processor (the “Processor”) instructing the Processor to deposit all Receipts into the Account. Merchant shall provide Funder and/or its authorized agent(s) with all of the information, authorizations and passwords necessary for verifying Merchant’s receivables, receipts, deposits and withdrawals into and from the Account. Merchant hereby authorizes Funder and/or its agent(s) to withdraw from the Account via ACH debit the amounts owed to Funder for the receipts as specified herein and to pay such amounts to Funder. These authorizations apply not only to the approved Account but also to any subsequent or alternate account used by the Merchant for these deposits, whether pre-approved by Funder or not. This additional authorization is not a waiver of Funder’s entitlement to declare this Agreement breached by Merchant as a result of its usage of an account which Funder did not first pre-approve in writing prior to Merchant’s usage thereof. The aforementioned authorizations shall be irrevocable without the written consent of Funder. Merchant acknowledges that it is entering into this Agreement in the ordinary course of its business and that the remittances to be made under this Agreement are being made in the ordinary course of Merchant’s business.
1.2 Term of Agreement. This Agreement shall remain in full force and effect until the entire Purchased Amount and any other amounts due are received by Funder as the terms of this Agreement. The provisions of Sections 1.1, 1.2, 1.5, 1.7, 1.8, 1.10, 1.12, 1.13, 1.14, 1.17, 2.3, 2.9, 2.10, 2.11, 2.12, 3.1, 3.2, 3.3, 3.4, 3.5, 4.3, 4.4, 4.5, 4.6, 4.10, and 4.11 shall survive any termination of this Agreement.
1.3 Reconciliation. As long as an Event of Default or breach of this Agreement has not occurred, Merchant, at any time, may request a retroactive reconciliation of the total Remittance amount. All requests hereunder must be in writing to [email protected]. Said request must include copies of all of Merchant’s bank account statements, credit card processing statements, and accounts receivable reports outstanding if applicable, from the date of this Agreement through and including the date the request is made. If you have questions or comments about your financing, you may contact us by e-mail at [email protected]. Funder retains the right to reasonably request additional documentation including bank login or access to view all Merchant’s accounts using third party software, to correctly and accurately perform the reconciliation, and Merchant’s refusal to provide access shall negate Funder’s obligation to perform a reconciliation until the Merchant provides the appropriate documents and access for Funder to perform a reconciliation. Such reconciliation, if applicable, shall be performed by Funder within five (5) business days following its receipt of Merchant’s request for reconciliation and supporting documentation and access by either crediting or debiting the difference back to, or from, Merchant’s bank Account so that the total amount debited by Funder shall equal the Remittance Percentage of the Receipts that Merchant collected during the contract term.
1.4 Adjustments to the Remittance. As long as an Event of Default, or breach of this Agreement, has not occurred, Merchant may give notice to Funder to request a decrease in the Remittance should Merchant experience a decrease in its Future Receipts. All requests hereunder must be in writing to [email protected] and must include copies of all of Merchant’s bank account statements, credit card processing statements, and accounts receivable reports outstanding from the date of this Agreement through and including the date the request is made. Funder retains the right to reasonably request additional documentation including bank login or 3rd party software access to view all Merchant’s accounts, refusal to provide such documentation or access shall negate Funder’s obligation to adjust the Remittance until the Merchant provides the appropriate documentation and access. The Remittance shall be modified to more closely reflect the Merchant’s actual Receipts by multiplying the Merchant’s actual Receipts by the Remittance Percentage divided by the number of business days in the previous two (2) calendar weeks. Merchant shall provide Funder with viewing access to their bank account as well as all information reasonably requested by Funder to properly calculate the Merchant’s Remittance. At the end of the two (2) calendar weeks the Merchant may request another adjustment pursuant to this Section or it is agreed that the Merchant’s Remittance shall return to the Remittance as agreed upon on Page 1 of this Agreement.
1.5 Financial Condition. Merchant and Guarantor(s)(s) (as hereinafter defined and limited) authorize Funder and its agents to investigate their financial responsibility and history, and will provide to Funder any authorizations, bank or financial statements, tax returns, etc., as Funder requests in its sole and absolute discretion prior to or at any time after execution of this Agreement. A photocopy of this authorization will be deemed as acceptable as an authorization for release of financial and credit information. Funder is authorized to update such information and financial and credit profiles from time to time as it deems appropriate. Merchant shall provide bank login information, or 3rd party software access, to view Merchant’s Account in connection with this Agreement. If Merchant changes the Account’s login information, Merchant must provide Funder with the updated login information in writing within 48 hours of such change. Merchant understands and agrees that Funder’s access to the Account is expressly limited to monitoring for defaults under the Agreement. Upon Funder’s request, Merchant shall within 48 hours provide login information to its bookkeeping software and/or provide weekly accounts receivable aging reports.
1.6 Transactional History. Merchant authorizes all of its banks, brokers and processors to provide Funder with Merchant’s banking, brokerage and/or processing history to determine qualification or continuation in this program and for collections purposes. Merchant shall provide Funder with copies of any documents related to Merchant’s card processing activity or financial and banking affairs within five (5) calendar days after a request from Funder.
1.7 Indemnification. Merchant and Guarantor(s)(s) hereby jointly and severally indemnify and hold harmless Funder and each Processor, their respective officers, directors, agents and representatives, contractors, affiliates, and shareholders (“Indemnitees”) against all losses, damages, costs, claims, liabilities and expenses (including reasonable attorney’s fees) incurred by any such Indemnitee as a direct or indirect result of (a) claims asserted by Funder for monies owed to Funder from Merchant and (b) actions taken by any Indemnitee in reliance upon any fraudulent, misleading or deceptive information or instructions provided by Merchant or any Guarantor(s).
1.8 No Liability. In no event will Funder be liable for any claims asserted by Merchant or Guarantor(s)s under any legal or equitable theory for lost profits, lost revenues, lost business opportunities, exemplary, punitive, special, incidental, indirect or consequential damages, each of which is waived by both, Merchant and Guarantor(s)(s). In the event these claims are nonetheless raised, Merchant and each Guarantor(s)s will be jointly liable for all of Funder’s attorney’s fees and expenses resulting therefrom.
1.9 Reliance on Terms. Section 1.1, 1.6, 1.7, 1.8 and 2.5 of this Agreement are agreed to for the benefit of Merchant, Funder, Processor, and Merchant’s bank and notwithstanding the fact that Processor and the bank are not a party of this Agreement, Processor and the bank may rely upon their terms and raise them as a defense in any action.
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1.10 Sale of Receipts. Merchant and Funder agree that the Purchase Price under this Agreement is in exchange for the Purchased Amount, and that such Purchase Price is not intended to be, nor shall it be construed as a loan from Funder to Merchant. Merchant agrees that the Purchase Price is in exchange for the sale the Receipts pursuant to this Agreement, and that it equals the fair market value of such Receipts. Funder has purchased and shall own all the Receipts described in this Agreement up to the full Purchased Amount as the Receipts are created. Merchant acknowledges and agrees that Receipts collected by Merchant are being held by Merchant in trust for the benefit of Funder for purposes of carrying out the terms of this Agreement and are the sole property of Funder until they are remitted to Funder. Merchant shall not use Funder’s share of Receipts apportioned to Remittance and shall reflect Funder’s ownership of Receipts on its books and records. Payments made to Funder in respect to the full Purchased Amount shall be conditioned upon Merchant’s sale of products and services, and the payment therefor by Merchant’s customers. By this Agreement, Merchant transfers to Funder full and complete ownership of the Purchased Amount and Merchant retains no legal or equitable interest therein. Funder hereby appoints Merchant, and Merchant accepts appointment, as servicer for and on behalf of Funder for the purpose of collecting and delivering Receipts to Funder as required by this Agreement until Funder has received the Purchased Amount. Merchant agrees that it will treat the amounts it receives and the purchased Receipts delivered to Funder under this Agreement in a manner consistent with a sale in its accounting records and tax returns. Merchant agrees that Funder is entitled to audit Merchant’s accounting records upon reasonable notice in order to verify compliance. Merchant waives any rights of privacy, confidentiality or taxpayer privilege in any litigation or arbitration in which Merchant asserts that this transaction is anything other than a sale of future receipts. In no event shall the aggregate of all amounts paid or payable to Funder hereunder, or any portion thereof be deemed as interest hereunder, and in the event it is found to be interest despite the parties hereto specifically representing that it is NOT interest, it shall be found that no sum charged or collected hereunder shall exceed the highest rate permissible at law. In the event that a court nonetheless determines that Funder has charged or received interest hereunder in excess of the highest applicable rate, the rate in effect hereunder shall automatically be reduced to the maximum rate permitted by applicable law and Funder shall promptly refund to Merchant any interest received by Funder in excess of the maximum lawful rate, it being intended that Merchant not pay or contract to pay, and that Funder not receive or contract to receive, directly or indirectly in any manner whatsoever, interest in excess of that which may be paid by Merchant under applicable law. In connection with the foregoing, Merchant knowingly and willingly waives the defense of usury in any action or proceeding should this transaction be deemed that of a loan and not a purchase of receivables.
1.11 Power of Attorney. Merchant irrevocably appoints Funder and its agents and representatives, as its agent and attorney-in-fact with full authority to take any action or execute any instrument or document to settle and ensure payment of all obligations due to Funder from Processor or Merchant, regardless of whether the obligation is current or due to a violation by Merchant of Section 1 or the occurrence of an Event of Default under Section 3 hereof, including without limitation: (i) to obtain and adjust insurance; (ii) to collect monies due or to become due under or in respect of any of the Secured Assets; (iii) to receive, endorse and collect any checks, notes, drafts, instruments, documents or chattel paper in connection with clause (i) or clause (ii) above; (iv) to sign Merchant’s name on any invoice, bill of lading, or assignment directing customers or account debtors to make payment directly to Funder; (v) to contact Merchant’s banks and financial institutions using Merchant and Guarantor(s)’ personal information to verify the existence of an account and obtain account balances; and (vi) to file any claims or take any action or institute any proceeding which Funder may deem necessary for the collection of any of the unpaid Purchased Amount from the Secured Assets, or otherwise to enforce its rights with respect to payment of the Purchased Amount including but not limited to, notifying and instructing account debtors of Merchant and any of Merchant’s Processors to remit payment of accounts and other collateral owed to Merchant directly to Funder. In connection therewith, all costs, expenses and fees, including legal fees, shall be payable by Merchant.
1.12 Protection of Information. Merchant and each person signing this Agreement on behalf of Merchant and/or as Owner or Guarantor(s), in respect of himself or herself personally, authorizes Funder to disclose information concerning Merchant’s, each Owner’s, and each Guarantor(s)’s credit standing (including credit bureau reports that Funder obtains) and business conduct only to agents, affiliates, subsidiaries, and credit reporting bureaus. Merchant, each Owner, and each Guarantor(s) hereby waive to the maximum extent permitted by law any claim for damages against Funder or any of its affiliates relating to any (i) investigation undertaken by or on behalf of Funder as permitted by this Agreement or (ii) disclosure of information as permitted by this Agreement.
1.13 Confidentiality. Merchant understands and agrees that the terms and conditions of the products and services offered by Funder, including this Agreement and any other Funder documents (collectively, “Confidential Information”) are proprietary and confidential information of Funder. Accordingly, unless disclosure is required by law or court order, Merchant shall not disclose Confidential Information of Funder to any person other than an attorney, accountant, financial advisor or employee of Merchant who needs to know such information for the purpose of advising Merchant (“Advisor”), provided such Advisor uses such information solely for the purpose of advising Merchant and first agrees in writing to be bound by the terms of this section. A breach hereof entitles Funder to not only damages and reasonable attorney’s fees but also to both a Temporary Restraining Order and a Preliminary Injunction without bond or security.
1.14 Publicity. Merchant and each of Merchant’s Owners and all Guarantor(s) hereby authorize Funder to use its name in listings of clients and in advertising and marketing materials.
1.15 D/B/A’s. Merchant hereby acknowledges and agrees that Funder may be using “doing business as” or “d/b/a” names in connection with various matters relating to the transaction between Funder and Merchant, including the filing of UCC-1 financing statements and other notices or filings.
1.16 Authority to Contact. Merchant and Owner/Guarantor(s) explicitly agree to be contacted by Funder and its agents and affiliates by telephone, email and/or SMS / text messaging provided in connection with this Agreement and agree to cover all usual third- party costs or charges that may be associated with such contacts. Merchant and Owner/Guarantor(s) understand that they are not required to agree to this Section as a condition of entering into this Agreement.
1.17 Authority to Service Accounts. In the event Merchant is unable or unwilling to collect all or some of the Receipts, Funder shall have the right, without waiving any of its other rights and remedies under this Agreement, to notify the Processor, any other credit card or payment processor used by Merchant, or any third party having monies owed to Merchant for its sale or delivery of goods or services (including without limitation Merchant’s customers), of the sale of the Receipts under this Agreement, and to direct such credit card, payment processor or other third party to make payment to Funder of all or any portion of the amounts received by such credit card, payment processor or third party on behalf of Merchant. If no Event of Default has occurred, Funder shall remit back to Merchant the excess above the Remittance Percentage of the Receipts that it collected pursuant to this paragraph within 2 business days of payment and shall provide a reconciliation in accordance with Section 1.3.
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2 REPRESENTATIONS, WARRANTIES AND COVENANTS
Merchant and each Guarantor represent, warrant and covenant that, as of this date and during the term of this Agreement:
2.1 Financial Condition and Financial Information.
Merchant’s and Guarantor(s)s’ bank and financial statements, copies of which have been furnished to Funder, and future statements which will be furnished hereafter at the discretion of Funder, and any other materials and information and statements made in connection with this Agreement are complete and truthful and fairly represent the financial condition of Merchant at such dates, and since those dates there has been no new financing obtained by Merchant or material adverse changes, financial or otherwise, in such condition, operation or ownership of Merchant. In particular, Merchant represents (i) that it has not obtained any financing from any third party, including but not limited to loans, merchant cash advances, receivables financing, or any other agreement, after the date indicated on the latest financial statement that Merchant submitted to Funder in support of the Merchant’s initial application for funding and (ii) that Merchant has no debt obligations that are not reflected on the financial documents provided by Merchant to Funder. Merchant and Guarantor(s)s have a continuing, affirmative obligation to advise Funder of any material adverse change in their financial condition, operation or ownership. Funder may request bank or financial statements at any time during the performance of this Agreement and the Merchant and Guarantor(s)s shall provide them to Funder within five (5) business days after request from Funder. Merchant’s or Guarantor(s)s’ failure to do so is a material breach of this Agreement.
2.2 Governmental Approvals. Merchant is in compliance and shall comply with all laws and has valid permits, authorizations and licenses to own, operate and lease its properties and to conduct the business in which it is presently engaged and/or will engage in hereafter.
2.3 Authorization. Merchant, and the person(s) signing this Agreement on behalf of Merchant, have full power and authority to incur and perform the obligations under this Agreement, all of which have been duly authorized.
2.4 Use of Funds. Merchant agrees that it shall use the Purchase Price for business purposes and not for personal, family, or household purposes.
2.5 Electronic Check Processing Agreement. Merchant will not change its Processor, add terminals, change its financial institution or bank account(s) or take any other action that could have any adverse effect upon Merchant’s obligations under this Agreement, without Funder’s prior written consent. Any such changes shall be a material breach of this Agreement.
2.6 Change of Name or Location. Merchant will not conduct Merchant’s businesses under any name other than as disclosed to the Processor and Funder, nor shall Merchant change any of its places of business without prior written notification to Funder.
2.7 Daily Batch Out. Merchant will batch out receipts with the Processor on a daily basis if applicable.
2.8 Estoppel Certificate. Merchant will at every and all times, and from time to time, upon at least one (1) day’s prior notice from Funder to Merchant, execute, acknowledge and deliver to Funder and/or to any other person, firm or corporation specified by Funder, a statement certifying that this Agreement is unmodified and in full force and effect (or, if there have been modifications, that the same is in full force and effect as modified and stating the modifications) and stating the dates which the Purchased Amount or any portion thereof has been paid to Funder.
2.9 No Bankruptcy. As of the date of this Agreement, Merchant is not insolvent and does not contemplate filing for bankruptcy in the next six(6) months and has not consulted with a bankruptcy attorney or filed any petition for bankruptcy protection pursuant to the United States Bankruptcy Code and there has been no involuntary petition brought or pending against Merchant. Merchant further represents and warrants that it does not anticipate filing any such bankruptcy petition nor does Merchant anticipate that an involuntary petition will be filed against Merchant. Notwithstanding the foregoing, the Merchant’s filing for bankruptcy shall not constitute an event of default under this Agreement. In the event Merchant or Guarantor files for bankruptcy, it shall notify Funder in writing within twenty-four (24) hours.
2.10 Unencumbered Receipts. Merchant has good, complete, unencumbered and marketable title to all Receipts and all Secured Assets in which Funder has been granted a security interest under the Security Agreement, free and clear of any and all liabilities, liens, claims, charges, restrictions, conditions, options, rights, mortgages, security interests, equities, pledges and encumbrances of any kind or nature whatsoever other than in favor of Funder or any other rights or interests that may be inconsistent with the transactions contemplated by this Agreement, or adverse to the interests of Funder except as disclosed by Merchant in writing and approved by Funder prior to entering into this Agreement.
2.11 Business Purpose. Merchant is a valid business in good standing under the laws of the jurisdictions in which it is organized and/or operates, and Merchant is entering into this Agreement for business purposes and not as a consumer for personal, family or household purposes.
2.12 Defaults under Other Contracts. Merchant’s execution of, and/or performance under this Agreement, will not cause or create an event of default by Merchant under any contract with another person or entity.
2.13 Good Faith. Merchant and Guarantor(s)s hereby affirms that Merchant is receiving the Purchase Price and selling Funder the Purchased Amount in good faith and will use the Purchase Price funds to maintain and grow Merchant’s business.
3 EVENTS OF DEFAULT AND REMEDIES
3.1 Events of Default. The occurrence of any of the following events shall constitute an “Event of Default” hereunder: (a) Merchant or Guarantor(s) shall violate any term or covenant in this Agreement; (b) Any representation or warranty by Merchant or Guarantor(s) in this Agreement shall prove to have been incorrect, false or misleading in any material respect when made; (c) the sending of notice of termination by Merchant or verbally notifying Funder of its intent to breach this Agreement; (d) the Merchant fails to request a reconciliation or adjustments to the Remittance pursuant to Sections 1.3 & 1.4 (as appropriate) within 1 business day of a Merchant’s Remittance returned of insufficient funds in the Account such that the ACH of the Remittance amount was not be honored by Merchant’s bank; (e) Merchant fails to provide its bank statements, and/or month to date bank activity, accounts receivable reports, and/or bank login information within two (2) business days of a request by Funder, or the Merchant changes its bank login information (which was previously-provided to Funder) without providing Funder with the updated login information in writing within 48 hours of such update; (f) Merchant shall voluntarily transfer or sell all or substantially all of its assets; (g) Merchant shall make or send notice of any intended bulk sale or transfer by Merchant; (h) Merchant shall use multiple depository accounts without the prior written consent of Funder or takes any other action that intentionally interferes with or prevents Funder from receiving the Purchased Amount in accordance with the terms of this Agreement; (i) Merchant shall enter into any financing agreements with any other party including but not limited to loans, merchant cash advances, receivables financing, or any other agreement that will increase the total debt owed by Merchant to any other party at any time following the date indicated on the latest financial statement submitted by Merchant to Funder in support of Merchant’s initial application for funding and continuing throughout the term of this Agreement; (j) Merchant shall change its depositing account without the prior written consent of Funder; (k) Merchant shall close its depositing account used for ACH debits without the prior written consent of Funder; (l) Merchant’s bank returns a code other than NSF preventing Funder’s receipt of Remittance; (m) Merchant, any of its Owners, or Guarantor(s), directly or indirectly, causes to be formed a new entity or otherwise becomes associated with any new or existing entity, which operates a business similar to or competitive with that of Merchant; (n) Merchant shall default under any of the terms, covenants and conditions of any other agreement with Funder; or (o) Merchant shall cancel or revoke any debit authorization it had provided to Funder, whether in this Agreement or in another agreement, form or authorization, unless Merchant shall have provided Funder with another debit authorization pursuant to a written agreement that is satisfactory to Funder in its sole discretion.
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Merchant’s default upon the Agreement frustrates Funder’s ability to fund other commercial financings and engage in additional business. Merchant’s default on the Agreement would require Funder to maintain additional staff and increased payroll to address and carry out internal procedures solely related to a default including but not limited to maintaining staff to support additional communications with Merchant and Guarantor(s) in relation to default, evaluating Merchant’s financial statements and debt obligations, preparing Merchant’s file, negotiating and drafting security release and subordination agreements, and providing Merchant with updated balance statements. Merchant and Guarantor(s) agree that the fee for Rejected ACH/Blocked ACH or Default fee is reasonable and bears a reasonable proportion to the probable loss that Funder may incur, as the actual loss may not be capable of estimation.
3.2 Limited Performance Guaranty. Guarantor(s) shall provide a limited guaranty of performance in connection with this Agreement (“Guaranty"). The Guaranty shall only guaranty the Merchant’s performance of the covenants, representations and conditions of this Agreement and shall not guarantee the Remittance payment except upon the occurrence of an Event of Default. Upon the occurrence of an Event of Default, Funder may enforce its rights against the Guarantor(s) of this transaction. Each Guarantor(s) will be jointly and severally liable to Funder for all of Funder’s losses and damages, in addition to all costs and expenses and legal fees associated with such enforcement. For the avoidance of doubt, Guarantor(s) shall not be liable in the event that Merchant is not liable under this Agreement.
3.3 Remedies. Upon the occurrence of an Event of Default that is not waived pursuant to Section 4.4. hereof, Funder may proceed to protect and enforce its rights or remedies by suit in equity or by action at law, or both, whether for the specific performance of any covenant, agreement or other provision contained herein, or to enforce the discharge of Merchant’s obligations hereunder (including the Guaranty) or any other legal or equitable right or remedy, including but not limited to (i) accelerating the full uncollected Purchased Amount, (ii) filing the Confession of Judgment and executing thereon, and (iii) enforcing the Security Agreement contained herein and any and all rights and remedies of a secured party under Uniform Commercial Code Article 9, and sending demand letters to account debtors and credit card processors. All rights, powers and remedies of Funder in connection with this Agreement may be exercised at any time by Funder after the occurrence of an Event of Default, are cumulative and not exclusive, and shall be in addition to any other rights, powers or remedies provided by law or equity. Upon an Event of Default under Section 3.1(i), Funder shall be permitted to immediately and for the duration of this Agreement collect twice or three times the Remittance amount, in accordance with Funder’s determination, in its sole discretion, of the increased risk caused to Funder as a result of such Event of Default.
3.4 Collection Fees. Upon the occurrence of an Event of Default and/or Funder’s retention of legal counsel to enforce this Agreement, Merchant and Guarantor(s) agree that a fee of the greater of (i) 30% of the Remaining Balance (Purchased Amount less amount remitted by Merchant) (“Collection Fees”) or (ii) Funder’s actual attorney’s fees incurred shall be immediately assessed and paid by Merchant to Funder. Merchant and Guarantor(s) agree that the calculation for Collection Fees and/or any attorney’s fees are reasonable.
3.5 Costs. Merchant shall pay to Funder all reasonable costs associated with (i) an Event of Default, (ii) breach by Merchant of the covenants in this Agreement and the enforcement thereof, and (iii) the enforcement of Funder‘s remedies set forth in this Agreement, including but not limited to court costs, Collection Fees and attorneys’ fees.
3.6 Required Notifications. Merchant is required to give Funder written notice within 24 hours of any filing under Title 11 of the United States Code. Merchant is required to give Funder seven (7) days’ written notice prior to the closing of any sale of all or substantially all of the Merchant’s assets or stock. Failure to comply with either of these required notifications shall be deemed an Event of Default.
4 MISCELLANEOUS
4.1 Modifications; Agreements. No modification, amendment, waiver or consent of any provision of this Agreement shall be effective unless the same shall be in writing and signed by Funder.
4.2 Assignment. Funder may assign, transfer or sell its rights hereunder or delegate its duties hereunder, either in whole or in part.
4.3 Notices. All notices, requests, consents, demands and other communications hereunder directed to Funder shall be delivered by email or certified mail, return receipt requested, to the respective address in this Agreement. All notices, requests, consents, demands and other communications hereunder directed to Merchant or Guarantor shall be delivered by first class mail and/or email to the respective addresses in this Agreement. Communications to Funder shall become effective only upon receipt by Funder. Communications to Merchant or Guarantor shall become effective three days after mailing.
4.4 Waiver of Remedies. No failure on the part of Funder to exercise, and no delay in exercising any right under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right under this Agreement preclude any other or further exercise thereof or the exercise of any other right. The remedies provided hereunder are cumulative and not exclusive of any remedies provided by law or equity.
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4.5 Binding Effect; Governing Law, Venue and Jurisdiction. This Agreement (including Security Agreement and Guaranty, Guaranty of Performance, and any and all addenda, attachments, exhibits, and other documents relating to this Agreement in any way) shall be binding upon and inure to the benefit of Merchant, Guarantor(s), and Funder and their respective heirs, administrators, executors, successors and assigns, except that Merchant and Guarantor(s) shall not have the right to assign their rights hereunder or any interest herein without the prior written consent of Funder which consent may be withheld in Funder’s sole discretion. Funder reserves the right to assign this Agreement with or without prior written notice to Merchant or any Guarantor. This Agreement, Security Agreement, Guaranty of Performance, and any and all addenda, attachments, exhibits, and other documents relating to this Agreement in any way, shall be governed by and construed in accordance with the laws of the state of New York, without regards to any applicable principles of conflicts of law. Any suit, action or proceeding arising hereunder, or the interpretation, performance or breach hereof, shall be instituted exclusively in the Supreme Court of the State of New York (the “Acceptable Forums”) and not in the federal courts located within the State of New York. The Merchant, and Guarantor(s) specifically waive their right to remove any state court action commenced by Funder and further consent to the Remand of any matter pending between any of the Parties to this Agreement to State Court. All Parties to this Agreement, hereby acknowledge and agree that the Acceptable Forums are convenient for the resolution of any disputes, submit to their jurisdiction and waive any and all rights to object to jurisdiction or venue in same. Merchant and Guarantor agree that any claim that is not asserted against Funder within one year of its accrual will be time barred. Merchant and Guarantor(s) hereby waive all formal service of process including but not limited to personal service and agree that the mailing of any Summons and Complaint in any proceeding commenced by Funder by first class mail to the mailing address listed on this Agreement (and that services shall be deemed effectuated on the date of such mailing), or via email to the email address listed in this Agreement (and that services shall be deemed effectuated on the date of such email), or any other process which may be required or permitted by any such court will constitute valid and lawful service of process against them without the necessity for service by any other means provided by statute or rule of court, but without invalidating service performed in accordance with such other provisions.
4.6 Survival of Representation, etc. All representations, warranties and covenants herein shall survive the execution and delivery of this Agreement and shall continue in full force until all obligations under this Agreement shall have been satisfied in full and this Agreement shall have terminated.
4.7 Interpretation. All Parties hereto have reviewed this Agreement with an attorney of their choice and have relied only upon their own attorneys’ guidance and advice. This Agreement shall not be construed as against the preparing party.
4.8 Severability. In case any of the provisions of this Agreement are found to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions of this Agreement shall not be affected or impaired in any way. Any provision hereof prohibited by law shall be ineffective only to the extent of such prohibition without invalidating the remaining provisions hereof.
4.9 Entire Agreement. This Agreement, including but not limited to the Security Agreement and the Guaranty embody the entire agreement between the parties and supersede all prior agreements and understandings relating to the subject matter hereof.
4.10 JURY TRIAL WAIVER. THE PARTIES HEREBY WAIVE TRIAL BY JURY IN ANY COURT IN ANY SUIT, ACTION OR PROCEEDING ON ANY MATTER ARISING IN CONNECTION WITH OR IN ANY WAY RELATED TO THIS AGREEMENT OR THE ENFORCEMENT THEREOF. THE PARTIES HERETO ACKNOWLEDGE THAT EACH PARTY MAKES THIS WAIVER KNOWINGLY, WILLINGLY AND VOLUNTARILY AND WITHOUT DURESS, AND ONLY AFTER EXTENSIVE CONSIDERATION OF THE RAMIFICATIONS OF THIS WAIVER WITH THEIR ATTORNEYS.
4.11 CLASS ACTION WAIVER. THE PARTIES HERETO WAIVE ANY RIGHT TO ASSERT ANY CLAIMS AGAINST THE OTHER PARTY AS A REPRESENTATIVE OR MEMBER IN ANY CLASS OR REPRESENTATIVE ACTION, EXCEPT WHERE SUCH WAIVER IS PROHIBITED BY LAW AS AGAINST PUBLIC POLICY. TO THE EXTENT EITHER PARTY IS PERMITTED BY LAW OR COURT OF LAW TO PROCEED WITH A CLASS OR REPRESENTATIVE ACTION AGAINST THE OTHER, THE PARTIES HEREBY AGREE THAT: (1) THE PREVAILING PARTY SHALL NOT BE ENTITLED TO RECOVER ATTORNEYS’ FEES OR COSTS ASSOCIATED WITH PURSUING THE CLASS OR REPRESENTATIVE ACTION (NOTWITHSTANDING ANY OTHER PROVISION IN THIS AGREEMENT); AND ( 2) THE PARTY WHO INITIATES OR PARTICIPATES AS A MEMBER OF THE
CLASS WILL NOT SUBMIT A CLAIM OR OTHERWISE PARTICIPATE IN ANY RECOVERY SECURED THROUGH THE CLASS OR REPRESENTATIVE ACTION.
4.12 ARBITRATION AGREEMENT. If Funder, Merchant, or any Guarantor requests, the other party(ies) agrees to arbitrate, through binding individual arbitration, any and all claims and disputes relating in any way to this Agreement or the parties’ dealings with one another (“Claims”) unless prohibited by Federal law. Claims concerning the validity, scope or enforceability of this Arbitration Agreement are expressly exempted from this Agreement. This Arbitration Agreement involves interstate commerce and shall be governed by the Federal Arbitration Act, 9 U.S.C. §§ 1-16 (“FAA”), and not by state law. In any claim or dispute to be resolved by arbitration, Merchant, Guarantor(s), and Funder will not be able to have a court or jury trial or participate in a class action or class arbitration. Other rights that Merchant, Guarantor(s), or Funder would have if the dispute went to court will not be available or will be more limited in arbitration, including the right to appeal. Merchant, Guarantor(s), and Funder understand and agree that, if arbitration is requested, through individual arbitration, THE PARTIES ARE EACH WAIVING THE RIGHT TO A COURT OR JURY TRIAL. ALL DISPUTES SHALL BE ARBITRATED ON AN INDIVIDUAL BASIS, AND NOT AS A CLASS ACTION, REPRESENTATIVE ACTION, CLASS ARBITRATION OR ANY SIMILAR PROCEEDING. The arbitrator(s) may not consolidate the claims of multiple parties without the parties’ express written consent. Arbitrations shall be administered, as determined by the party commencing the arbitration, either by American Arbitration Association, New Era ADR or Resolute Dispute Resolution Nationwide pursuant to their applicable arbitration rules in effect at the time the arbitration is initiated. Information about arbitration, arbitration procedures and fees may be obtained by visiting www.adr.org., https://www.neweraadr.com/, or https://resolutesystems.com/. The parties hereby agree to any portion of the fee allocated to them by the arbitrating body promptly and further agree that if any one party is required to pay any portion of the other party’s arbitration fee for any reason, that amount shall be recoverable by the party who paid it and in any resulting arbitration award. The arbitrator’s decision shall be final and binding. The parties agree that this Arbitration Agreement extends to any other parties involved in any Claims including but not limited to successors and assigns, servicers, agents, and backup services. Merchant, Guarantor(s), and Funder each may exercise any lawful rights to seek provisional remedies or self-help, without waiving the right to arbitrate by doing so. The parties may confirm the arbitration award in either the courts of the State of New York or in the courts of the State where Merchant or Guarantor(s) is located. The prevailing party in Arbitration will be entitled to recover any costs associated with confirming the award.
Notwithstanding any other provision of this Agreement, if the foregoing class action waiver and prohibition against class arbitration is determined to be invalid or unenforceable, then this entire Arbitration Agreement shall be void. If a claim is brought seeking public injunctive relief and a court determines that the restrictions in the Arbitration Agreement prohibiting the arbitrator from awarding relief on behalf of third parties are unenforceable with respect to such claim (and that determination becomes final after all appeals have been exhausted), the claim for public injunctive relief will be determined in court and any individual claims will be arbitrated. In such a case, the court shall stay the claim for public injunctive relief until the arbitration pertaining to individual relief has been entered in court. In no event will a claim for public injunctive relief be arbitrated. If any other portion of this Arbitration Agreement is deemed invalid or unenforceable, it shall not invalidate the remaining portions of this Arbitration Agreement. This Arbitration Agreement will survive the termination of this Agreement, Merchant’s and Guarantor(s) fulfillment or default of their respective obligations under this Agreement, and/or bankruptcy or insolvency of any party to this Agreement (to the extent permitted by applicable law).
| Initial | /s/ BCP |
7
MERCHANT AND GUARANTOR(S) HAVE THE RIGHT TO REJECT THIS ARBITRATION AGREEMENT, BUT THIS RIGHT MUST BE EXERCISED PROMPTLY. If Merchant or any Guarantor do not wish to be bound by this Arbitration Agreement, Merchant or Guarantor must notify Funder in writing within thirty (30) days after the date Merchant or Guarantor sign this Agreement. The Merchant or Guarantor rejecting this Arbitration Agreement must send a request by sending an e-mail to [email protected]. The request must include the rejecting party’s full name, address, date of this Agreement, and the statement “I reject the Arbitration Agreement.” If either Merchant or any of Guarantor(s) exercise the right to reject arbitration, the other terms of this Agreement shall remain in full force and effect as if the rejecting party had not rejected arbitration.
4.13 Facsimile and Digital Signatures. Facsimile signatures and digital signatures hereon shall be deemed acceptable for all purposes.
4.14 Independent Sales Organizations. Merchant and Guarantor(s) acknowledge that it may have been introduced to Funder by or received assistance in entering into this Agreement or Security Agreement and Guarantee of Performance from an independent sales organization or broker (“ISO”). Merchant and Guarantor(s) agree that any ISO is separate from and is not an agent or representative of Funder. Merchant and Guarantor(s) exculpate from liability and agree to hold harmless and indemnify Funder and its officers, directors, members, employees, and agents from and against all losses, damages, claims, liabilities, and expenses (including reasonable attorney and expert fees) incurred by Merchant or Guarantor(s) resulting from any act or omission by any ISO. Merchant and Guarantor(s) acknowledge that any fee that they paid to any ISO for its services is separate and apart from any payment under this Agreement. Each Merchant and each Guarantor acknowledge that Funder does not in any way require the use of an ISO and that any fees charged by any ISO are not required as a condition or incident to this Agreement.
5 SECURITY AGREEMENT AND GUARANTY OF PERFORMANCE
THE TERMS, DEFINITIONS, CONDITIONS AND INFORMATION SET FORTH IN THE REVENUE PURCHASE AGREEMENT ARE HEREBY INCORPORATED IN AND MADE A PART OF THIS SECURITY AGREEMENT AND GUARANTY OF PERFORMANCE. CAPITALIZED TERMS NOT DEFINED IN THIS SECURITY AGREEMENT AND GUARANTY, SHALL HAVE THE MEANING SET FORTH IN THE REVENUE PURCHASE AGREEMENT.
| Merchant’s Legal Name | |
| BOURQUE HEATING & COOLING CO., INC. | |
| D/B/A: | |
| BOURQUE HEATING & COOLING |
| Physical Address | 1199 PITCHERS WAY |
| City | HYANNIS | State | MASSACHUSETTS |
| Zip | 02601 | Federal ID | 04-3446912 |
SECURITY AGREEMENT
Security Interest. This Agreement will constitute a security agreement under the Uniform Commercial Code. To secure Merchant’s obligations under the Revenue Purchase Agreement to make available or deliver Purchased Amount to Funder and Funder’s right to realize the Purchased Amount, as and to the extent required by the terms of the Revenue Purchase Agreement, and performance of and compliance by Merchant with its other undertakings and agreements here in, Merchant and Guarantor(s) grant to Funder a continuing security interest in and lien upon: (a) all accounts, chattel paper, documents, equipment, general intangibles, instruments, and inventory, as those terms are each defined in Article 9 of the Uniform Commercial Code (the “UCC”), now or hereafter owned or acquired by Merchant and/or Guarantor(s)(s), (b) all proceeds, as that term is defined in Article 9 of the UCC (c) all funds at any time in the Merchant’s and/or Guarantor(s) (s) Account, regardless of the source of such funds, (d) present and future Electronic Check Transactions, and (e) any amount which may be due to Funder under this Agreement, including but not limited to all rights to receive any payments or credits under this Agreement (collectively, the “Secured Assets”).
Merchant and Guarantor agree to provide other security to Funder upon request to secure Merchant’s obligations under this Agreement. Merchant and Guarantor agree that, if at any time there are insufficient funds in Merchant’s Account to cover Funder’s entitlements under this Agreement, Funder is granted a further security interest in all of Merchant’s and Guarantor’s assets of any kind whatsoever to the fullest extent permitted by law, and such assets shall then become Secured Assets. These security interests and liens will secure all of Funder’s entitlements under this Agreement and any other agreements now existing or later entered into between
Merchant, Funder or an affiliate of Funder. In the event Merchant or any of its Guarantor(s) forms or causes to be formed a new entity or otherwise becomes associated with any new or existing entity (including but not limited to affiliation, merger, acquisition or consolidation) which operates a business similar to or the same as that of Merchant or any of its Guarantor(s), such new or existing entity shall be deemed to have expressly assumed Merchant’s and such Guarantor’s obligations due to Funder under this Agreement. Funder shall be deemed to have been granted an irrevocable power of attorney over any such new or existing entity to file any and all financing statements required under the Uniform Commercial Code. Without limiting the generality of foregoing, security interest granted hereby by Guarantor(s) shall extend to payments and performance of all present and future debts, liabilities and obligations of Guarantor(s) to Funder hereunder including, without limitation, under, in connection with or relating to the Guaranty of Performance (as defined below).
Funder shall be held harmless by Merchant and each Owner/Guarantor(s) and be relieved of any liability as a result of any such authentication and filing of any such financing statement or the resulting perfection of its ownership rights or security interests in such entity’s assets. Funder shall have the right at any time to notify Merchant’s and such other entity’s, as applicable, payors or account debtors (as defined by the UCC) of Funder’s rights, including without limitation, Funder’s right to collect all accounts, and to notify any payment card processor or creditor of such entity that Funder has such rights in such entity’s assets. Merchant and Guarantor(s) also agree that, at the Funder’s discretion, Funder may choose to amend any existing financing statement to include any such newly formed entity as debtor. This security interest may be exercised by Funder without notice or demand of any kind, including but not limited to, by making an immediate withdrawal or freezing the Secured Assets.
| Initial | /s/ BCP |
8
Pursuant to Article 9 of the Uniform Commercial Code, as amended from time to time, Funder has control over and may direct the disposition of the Secured Assets, without further consent of Merchant or Guarantor(s). Merchant and Guarantor(s) hereby represent and warrant that no other person or entity has a security interest in the Secured Assets except as set forth in this Agreement. With respect to such security interests and liens, Funder will have all rights afforded under the Uniform Commercial Code, any other applicable law and in equity. Merchant and Guarantor(s) will obtain from Funder written consent prior to granting a security interest of any kind in the Secured Assets to a third party. Merchant and Guarantor(s) (s) agree(s) that this is a contract of recoupment and Funder is not required to preserve its rights to this Agreement by seeking automatic stay relief under the Bankruptcy Code and Merchant and Guarantor(s) shall not contest any efforts by Funder to protect and preserve its rights under the Bankruptcy Code. Merchant and Guarantor(s)(s) agree(s) to execute and deliver to Funder such instruments and documents Funder may reasonably request (including the execution of any account control agreements) and take any action in connection with this Agreement as Funder deems necessary to perfect, maintain and confirm Funder’s first priority security interest in the Secured Assets and additional collateral, the lien, and right of set off set forth in this Agreement. Funder is authorized to execute all such instruments and documents in Merchant’s and Guarantor(s)(s) name.
Merchant and Guarantor(s)(s) each acknowledge and agree that any security interest granted to Funder under any other agreement between Merchant or Guarantor(s)(s) and Funder (the “Cross-Collateral”) will secure the obligations hereunder and under the Revenue Purchase Agreement. Merchant and Guarantor(s)(s) each hereby authorizes Funder to file any financing statements deemed necessary by Funder to perfect or maintain Funder’s security interest. Funder disclaims any security interest in household goods of Guarantor, in which Funder is forbidden by law from taking a security interest.
Merchant and Guarantor(s)(s) shall be liable for, and Funder may charge and collect, all costs and expenses, including but not limited to attorney’s fees, which may be incurred by Funder in protecting, preserving and enforcing Funder’s security interest and rights.
Negative Pledge. Merchant and Guarantor(s)(s) each agrees not to create, incur, assume, or permit to exist, directly or indirectly, any lien on or with respect to any of the Secured Assets or the additional collateral, as applicable.
Consent to Enter Premises and Assign Lease. Funder shall have the right to cure Merchant’s default in the payment of rent on the following terms. In the event Merchant is served with papers in an action against Merchant for nonpayment of rent or for summary eviction, Funder may execute its rights and remedies under the assignment of lease. Merchant also agrees that Funder may enter into an agreement with Merchant’s landlord giving Funder the right: (a) to enter Merchant’s premises and to take possession of the fixtures and equipment therein for the purpose of protecting and preserving same; and/or (b) to assign Merchant’s lease to another qualified business capable of operating a business comparable to Merchant’s at such premises.
Remedies. Upon any Event of Default, Funder may pursue any remedy available at law (including those available under the provisions of the UCC), or in equity to collect, enforce, or satisfy any obligations then owing to Funder, whether by acceleration or otherwise.
GUARANTY OF PERFORMANCE
As an additional inducement for Funder to enter into the Revenue Purchase Agreement, the undersigned Guarantor(s)(s) hereby provides Funder with this Guaranty. Guarantor(s)(s) will not be personally liable for any amount due under the Revenue Purchase Agreement unless Merchant commits an Event of Default pursuant to Section 3.1 of the Revenue Purchase Agreement. Each Guarantor(s) shall be jointly and severally liable for all amounts owed to Funder in the Event of Default. Guarantor(s) (s) guarantee Merchant’s good faith, truthfulness and performance of all of the representations, warranties, covenants made by Merchant in this Agreement including the Merchant’s full and timely delivery of the Purchased Amount pursuant to (and limited by) the Revenue Purchase Agreement, in each case as each may be renewed, amended, extended or otherwise modified (the “Guaranteed Obligations”). Guarantor(s)’s obligations are due at the time of any breach by Merchant of any representation, warranty, or covenant made by Merchant in the Agreement.
Guarantor(s) Waivers. In the event of a breach of the above, Funder may seek recovery from Guarantor(s)s for all of Funder’s losses and damages by enforcement of Funder’s rights under this Agreement without first seeking to obtain payment from Merchant, any other Guarantor(s), or any Secured Assets or additional collateral Funder may hold pursuant to this Agreement or any other guaranty. In addition, Sections 4.5, 4.10 and 4.11 in the Revenue Purchase Agreement Terms and Conditions are expressly reiterated in the Security Agreement and the Guaranty of Performance herein. Funder is not required to notify Guarantor(s) of any of the following events and Guarantor(s) will not be released from its obligations under this Agreement if it is not notified of: (i) Merchant’s failure to pay timely any amount required under the Revenue Purchase Agreement; (ii) any adverse change in Merchant’s financial condition or business; (iii) any sale or other disposition of any collateral securing the Guaranteed Obligations or any other guaranty of the Guaranteed Obligations; (iv) Funder’s acceptance of this Agreement; and (v) any renewal, extension or other modification of the Revenue Purchase Agreement or Merchant’s other obligations to Funder. In addition, Funder may take any of the following actions without releasing Guarantor(s) from any of its obligations under this Agreement: (i) renew, extend or otherwise modify the Revenue Purchase Agreement or Merchant’s other obligations to Funder; (ii) release Merchant from its obligations to Funder; (iii) sell, release, impair, waive or otherwise fail to realize upon any collateral securing the Guaranteed Obligations or any other guaranty of the Guaranteed Obligations; and (iv) foreclose on any collateral securing the Guaranteed Obligations or any other guaranty of the Guaranteed Obligations in a manner that impairs or precludes the right of Guarantor(s) to obtain reimbursement for payment under this Agreement. Until the Purchased Amount and Merchant’s other obligations to Funder under the Revenue Purchase Agreement including this Security Agreement are paid in full, Guarantor(s) shall not seek reimbursement from Merchant or any other Guarantor(s) for any amounts paid by it under this Agreement. Guarantor(s) permanently waives and shall not seek to exercise any of the following rights that it may have against Merchant, any other Guarantor(s), or any collateral provided by Merchant or any other Guarantor(s), for any amounts paid by it, or acts performed by it, under this Agreement: (i) subrogation; (ii) reimbursement; (iii) performance; (iv) indemnification; or (v) contribution.
In the event that Funder must return any amount paid by Merchant or any other Guarantor(s) of the Guaranteed Obligations because that person has become subject to a proceeding under the United States Bankruptcy Code or any similar law, Guarantor(s)’s obligations under this Agreement shall continue and survive throughout the bankruptcy proceeding and after the proceeding has closed. Guarantor(s) acknowledges that: (i) He/She is bound by the Class Action Waiver provision in the Revenue Purchase Agreement Terms and Conditions; (ii) He/She understands the seriousness of the provisions of this Agreement; (iii) He/She has had a full opportunity to consult with counsel of his/her choice; and (iv) He/ She has consulted with counsel of its choice or has decided not to avail himself/herself of that opportunity.
| Initial | /s/ BCP |
9
This Security Agreement and the Guaranty of Performance shall be governed by and construed in accordance with the laws of the state of New York, without regards to any applicable principals of conflicts of law. Any suit, action or proceeding arising hereunder, or the interpretation, performance or breach hereof, shall, if Funder so elects, be instituted in the Supreme Court of the State of New York, (the “Acceptable Forums”). Merchant and Guarantor(s) agree that the Acceptable Forums are convenient to it, and submits to the jurisdiction of the Acceptable Forums and waives any and all objections to jurisdiction or venue. Merchant and Guarantor(s) agree that the Acceptable Forums are convenient to it, and submit to the jurisdiction of the Acceptable Forums and waives any and all objections to jurisdiction or venue. Should such proceeding be initiated in any other forum, Merchant and Guarantor(s) waive any right to oppose any motion or application made by Funder to transfer such proceeding to an Acceptable Forum.
The Merchant and Guarantor acknowledge that they have read Sections 4.5 and 4.12 in the Revenue Purchase Agreement Terms and Conditions in its entirety and understand that they are agreeing with the Arbitration Agreement and waiving their rights to formal Service of Process including but not limited to personal service and will accept process of any Summons and Complaint or other legal process by first class mail and/or email to the respective Mailing Address and/or Email Address on Page 1 of the Agreement.
BY SIGNING THIS AGREEMENT IN THE SPACE PROVIDED BELOW, YOU AGREE TO THE TERMS OF THE AGREEMENT, INCLUDING THE ARBITRATION CLAUSE.
MERCHANT(S)
| FOR ALL MERCHANT(s) (#1) By: | FOR THE MERCHANT (#2) By: | |
| BHASKAR CHANDRA PANIGRAHI | ||
| Print Name and Title | Print Name and Title | |
| ###-##-#### | ||
| SSN# | SSN# | |
| /s/ BHASKAR CHANDRA PANIGRAHI | ||
| Signature | Signature |
GUARANTOR(S)
| BY GUARANTOR (#1) By: | BY GUARANTOR (#1) By: | |
| BHASKAR CHANDRA PANIGRAHI | ||
| Print Name and Title | Print Name and Title | |
| ###-##-#### | ||
| SSN# | SSN# | |
| /s/ BHASKAR CHANDRA PANIGRAHI | ||
| Signature | Signature |
| Initial | /s/ BCP |
10
APPENDIX A - THE FEE STRUCTURE:
A. Underwriting Fee $ 2,588.00 to cover the underwriting and related expenses shall be deducted from the Purchase Price.
B. Origination Fee $2,588.00 to cover the cost of Origination and ACH Setup shall be deducted from the Purchase Price.
C. NSF Fee $35. When merchant fails to provide advanced notice of an NSF.
D. Rejected ACH/Blocked ACH/Default Fee: $5,000. When Merchant blocks the Account from our ACH debit, directs their bank to reject our ACH debit, or changes their designated bank Account, or engages in any other Default of the Agreement.
E. Bank Change Fee $50.00. When Merchant requires a change of Bank Account to be Debited, requiring us to adjust our system.
F. Wire Fee - Each Merchant shall receive their funding electronically to their designated bank account and will be charged $50.00 for a Fed Wire or $0.00 for a bank ACH. Wire Fee shall be deducted from the Purchase Price.
| FOR ALL MERCHANT(s) (#1) By: | FOR ALL MERCHANT(s) (#2) By: | |
| BHASKAR CHANDRA PANIGRAHI | ||
| Print Name and Title | Print Name and Title | |
| /s/ BHASKAR CHANDRA PANIGRAHI | ||
| Signature | Signature |
| Initial | /s/ BCP |
11
APPENDIX B - Merchant’s Legal Names:
BOURQUE HEATING & COOLING CO INC / BOURQUE HEATING & COOLING CO. / BOURQUE / 35 BUXTON STREET REALTY, LLC / AVANTI FAMILY LLC / CONNECTM TECHNOLOGY SOLUTIONS INC. / CAMBRIDGE ENERGY RESOURCES, INC. / KEEN ENERGY TECHNOLOGIES LLC / AIRFLOW SERVICE COMPANY / DESIGNED TEMPERATURES, INC. / CONNECTM FLORIDA RE LLC / CAZEAULT SOLAR & HOME LLC / AURAI LLC / BLUE SKY ELECTRIC, INC. / FLORIDA SOLAR PRODUCTS, INC. / AVANTI HOLDINGS LLC / CAMBRIDGE ENERGY HOLDINGS, LLC / CONNECTM BABIONE LLC / CONNECTM DE LLC / ABSOLUTELY COOL AIR CONDITIONING LLC
| Initial | /s/ BCP |
12
AUTHORIZATION AGREEMENT FOR DIRECT DEPOSIT (ACH CREDIT) AND DIRECT PAYMENTS (ACH DEBITS)
| Merchant: | BOURQUE HEATING & COOLING CO., INC. |
| (Merchant’s Legal Name) |
| Revenue Purchase Agreement: Revenue Purchase Agreement between Funder and Merchant, dated as of | 11/04/2025 |
| (Month) (Day) (Year) |
Designated Checking Account:
| Bank Name: | CAPE CODE 5 | Branch: |
| Tax ID: | 04-3446912 |
| ABA: Routing: | 211371078 | DDA: Account: | 898003322 |
Capitalized terms used in this Authorization Agreement without definition shall have the meanings set forth in the Revenue Purchase Agreement By signing below, Merchant attests that the Designated Checking Account was established for business purposes and not primarily for personal, family or household purposes. This Authorization Agreement for Direct Deposit (ACH Credit) and Direct Payments (ACH Debits) is part of (and incorporated by reference into) the Revenue Purchase Agreement. Merchant should keep a copy of this important legal document for Merchant’s records.
DISBURSEMENT OF ADVANCE PROCEEDS. By signing below, Merchant authorizes Funder to disburse the Advance proceeds less the amount of any applicable fees upon Advance approval by initiating ACH credits to the Designated Checking Account, in the amounts and at the times specified in the Revenue Purchase Agreement. By signing below, Merchant also authorizes Funder to collect amounts due from Merchant under the Revenue Purchase Agreement by initiating ACH debits to the Designated Checking Account, as follows:
In the amount of: $$5,025.00 (Or) Percentage of each Banking Deposit: 9 % On the Following Day(s): TUESDAY
If the Payment Frequency is weekly, Funder may alter the Payment Frequency from weekly to daily upon Funder’s sole determination that an Event of Default occurred or Merchant missed a Remittance. By signing below, Merchant also authorizes Funder to collect amounts due from Merchant under the Revenue Purchase Agreement by initiating ACH debits to the Designated Checking Account, as follows:
In the amount of: $1,005.00 Or) Percentage of each Banking Deposit: 9 % On the Following Day(s):
Monday Tuesday
Wednesday Thursday
Friday
If any payment date falls on a weekend or holiday, I understand and agree that the payment may be executed on the next business day. If a payment is rejected by Merchant’s financial institution for any reason, including without limitation insufficient funds, Merchant understands that Funder may, at its discretion, attempt to process the payment again as permitted under applicable ACH rules. Merchant also authorizes Funder to initiate ACH entries to correct any erroneous payment transaction. Merchant also authorizes Funder or its affiliates and servicer to collect amounts due. In the event of default, Merchant authorizes Funder to collect the full Purchased Amount balance plus any applicable fees due from the Merchant under the Revenue Purchase Agreement by initiating either a single or multiple ACH debits to the Designated Checking Account.
MISCELLANEOUS. Funder is not responsible for any fees charged by Merchant’s bank as the result of credits or debits initiated under this Authorization Agreement. The origination of ACH debits and credits to the Designated Checking Account must comply with applicable provisions of state and federal law, and the rules and operating guidelines of NACHA (formerly known as the National Automated Clearing House Association). This Authorization Agreement is to remain in full force and effect until Funder has received written notification from Merchant at the address set forth below at least 5 banking days prior to its termination to afford Funder a reasonable opportunity to act on it. The individual signing below on behalf of Merchant certifies that he/she is an authorized signer on the Designated Checking Account. Merchant will not dispute any ACH transaction initiated pursuant to this Authorization Agreement, provided the transaction corresponds to the terms of this Authorization Agreement. Merchant requests the financial institution that holds the Designated Checking Account to honor all ACH entries initiated in accordance with this Authorization Agreement.
| Merchant | Date | |
| BOURQUE HEATING & COOLING CO., INC. | 11/04/2025 | |
| (Merchant’s Legal Name) | (Month) (Day) (Year) | |
| Director | ||
| Title | ||
| BHASKAR CHANDRA PANIGRAHI | /s/ BHASKAR CHANDRA PANIGRAHI | |
| Print Name | (Signature) |
| Initial | /s/ BCP |
13
BANK LOGIN INFORMATION
Dear Merchant,
Thank you for accepting this offer from NewCo Capital Group® VI LLC. We look forward to being your funding partner for as long as you need.
Daily ACH Program:
Funder will also require viewing access to your bank account, prior to funding, as part of our underwriting process.
You must update us with any changes to the login information within 48 Hours.
Please fill out the form below with the information necessary to access
your account.
* Be sure to indicate capital or lowercase letters.
| Name of Bank | Username | |
| Bank portal website | Password | |
| Security Question 1 | Security Answer 1 | |
| Security Question 2 | Security Answer 2 | |
| Security Question 3 | Security Answer 3 | |
Any other information necessary to access your account:
| MERCHANT/OWNER NAME | Date | |
| BHASKAR CHANDRA PANIGRAHI | 11/04/2025 | |
| Print Name and Title | (Month) (Day) (Year) | |
| /s/ BHASKAR CHANDRA PANIGRAHI | ||
| Signature |
| Initial | /s/ BCP |
14
DISBURSEMENT AUTHORIZATION
| MERCHANT: | BOURQUE HEATING & COOLING CO., INC. |
| FUNDER: | NEWCO CAPITAL GROUP® VI LLC (“NCG”) |
| FUNDING AMOUNT: | $ 150,000.00 |
| DATE: | 11/04/2025 |
The undersigned hereby authorizes to make the following NEWCO CAPITAL GROUP® VI LLC (“NCG”) deductions from proceeds and/or draw the following checks from the Funded Amount in accordance with the terms of the Receivables Purchase Agreement.
Deductions:
| $ | 0.00 | Payoff to | NEWCO CAPITAL GROUP® VI LLC (“NCG”) | |
| $ | 0.00 | Payoff to | - | |
| $ | 2,588.00 | Underwriting Fee | ||
| $ | 2,588.00 | Origination Fee | ||
| $ | 50.00 | Wire Fee | ||
| Total Deductions: $ | 5,226.00 |
| Net Amount Funded: $ | 144,774.00 |
IN WITNESS WHEREOF, this Disbursement Authorization has been duly executed by the undersigned as of the day and year first above written.
| MERCHANT: | BOURQUE HEATING & COOLING CO., INC. |
| NAME: | BHASKAR CHANDRA PANIGRAHI |
| Initial | /s/ BCP |
15
Exhibit 10.8
Merchant‘s Legal Name: Aurai LLC, together with all its subsidiaries including its affiliates and related entities). known and unknown (collectively, “Merchant”)
| D/B/A (if applicable): |
| State of Incorporation / Organization: | MA |
| Entity Type: | Incorporation |
| Physical Address of Merchant: | 2 MOUNT ROYAL AVE STE 500 MARLBOROUGH, MA 01752-1960 |
|
| Mailing Address of Merchant: | 4 Jefferson RD Westborough, MA 01581-2404 |
| Merchant Contact: | Mahesh Choudhury |
AGREEMENT OF PURCHASE AND SALE OF FUTURE RECEIVABLES
Merchant hereby sells, assigns and transfers to Nebula Asset Holdings LLC, a New York limited liability company (“Purchaser”) and you agree to sell to Purchaser, in consideration of the funds provided (“Purchase Price”) specified below, all of Merchant’s future accounts, contract rights and other entitlements arising from or relating to the payment of monies from Merchant’s customers’ and/or other third party payors, including all payments made by cash, check, credit or debit card, electronic transfer or other form of monetary payment in the ordinary course of the merchant’s business (the “Future Receipts”), for the payment of Merchant’s sale of goods or services (the “Transactions”) until the amount of Future Receipts specified below (the “Purchased Amount”) and all fees due under this Agreement has been delivered by Merchant to Purchaser.
The Purchased Amount shall be paid to Purchaser by Merchant’s irrevocably directing and authorizing that there by only one depositing bank account, which must be acceptable to, and pre-approved by, Purchaser (the “Account”) into which Merchant and Merchant’s customers shall remit the percentage specified of 15% (the “Specified Percentage”) of the Merchant’s settlement amounts due from each Transaction, until such time as Purchaser receives payment in full of the Purchased Amount. Merchant hereby authorizes Purchaser to automated clearing house (“ACH”) debit up to and including the specified remittances from the Account on a daily basis and will provide Purchaser with all required access codes, and monthly bank statements. Merchant acknowledges and agrees that it is responsible for ensuring that the Specified Percentage to be debited by Purchaser remains in the Account and will be held responsible for any fees incurred by Purchaser resulting from a rejected ACH attempt or an Event of Default (defined below). (See Appendix A).
Purchaser is not responsible for any overdrafts or rejected transactions that may result from Purchaser’s ACH debiting the specified amounts under the terms of this Agreement. Purchaser will either (i) debit the Specified Percentage on a daily basis, or (ii) if a Specific Daily Amount is specified hereunder, then Purchaser shall debit the Specific Daily Amount on each business day, and upon the Merchant’s request and receipt of the Merchant’s monthly bank statements, Purchaser shall, on or about the eighteenth day of each month reconcile the Merchant’s Account by either crediting or debiting the difference between the amount debited and the Specified Percentage, from or back to the Merchant’s Account so that the amount debited each month equals the Specified Percentage. Purchaser may, upon Merchant’s request, adjust the amount of any payment due under this Agreement at Purchaser’s sole discretion and as it deems appropriate. Notwithstanding anything to the contrary in this Agreement or any other agreement between PURCHASER and Merchant, upon the violation of any provision contained in Section 1.12 of the MERCHANT AGREEMENT TERMS AND CONDITIONS or the occurrence of an Event of Default under Section 3 of the MERCHANT AGREEMENT TERMS AND CONDITIONS, the Specified Percentage shall equal 100%. A list of all fees applicable under this agreement is annexed hereto in Appendix A.
| Total Payback: | $81,000 | Weekly Payment: | $4,050 |
| Borrowed Price: | $60,000 | Fees: | $5,400 |
| Net Amount: | $54,600 | Term: | 20 Weeks |
THE PURCHASE AND SALE OF FUTURE RECEIVABLES AGREEMENT TERMS AND CONDITIONS SET FORTH ON PAGE 2, THE “SECURITY AGREEMENT AND GUARANTY” AND THE “ADMINISTRATIVE FORM” HEREOF, ARE ALL HEREBY INCORPORATED IN AND MADE A PART OF THIS AGREEMENT.
| MERCHANT (together with all its subsidiaries. known and unknown) | PURCHASER | |||
| Mahesh Prasad Choudhury | Nebula Asset Holdings LLC | |||
| Print Name: | Mahesh Choudhury | Print Name: | ||
| Title: | VP US Oerations | Title: | ||
| Signature: | /s/ Mahesh Choudhury | Signature: | ||
TERMS AND CONDITIONS TO PURCHASE AND SALE OF FUTURE RECIVABLES.
To the extent set forth herein, each of the parties is obligated upon his, her or its execution of the Agreement to all terms of the Agreement, including the Additional Terms set forth below. Each of above-signed Merchant and Owner(s) represents that he, she or it, is authorized to sign this Agreement for Merchant, legally binding said Merchant to repay this obligation and that the information provided herein and in all of Purchaser documents, forms and recorded interviews is true, accurate and complete in all respects. If any such information is false or misleading, Merchant shall be deemed in material breach of all agreements between Merchant and Purchaser and Purchaser shall be entitled to all remedies available under law. Purchaser may produce a monthly statement reflecting the delivery of the Specified Percentage of Receivables from Merchant via Processor and/or Operator to Purchaser. An investigative report may be made in connection with the Agreement. Merchant and each of the above-signed Owners authorizes Purchaser, its agents and representatives and any credit-reporting agency engaged by Purchaser, to (i) investigate any references given or any other statements or data obtained from or about Merchant or any of its Owners for the purpose of this Agreement, and (ii) pull credit report at any time now or for so long as Merchant and/or Owners(s) continue to have any obligation owed to Purchaser as a consequence of this Agreement or for Purchaser’s ability to determine Merchant’s eligibility to enter into any future agreement with Company. ANY MISREPRESENTATION MADE BY MERCHANT OR OWNER IN CONNECTION WITH THIS AGREEMENT MAY CONSTITUTE A SEPARATE CAUSE OF ACTION FOR FRAUD OR INTENTIONAL MISREPRESENTATION.
ARTICLE I: TERMS OF ENROLLMENT IN PROGRAM
1.1. Merchant Deposit Agreement. Merchant shall execute an agreement (the “Merchant Deposit Agreement”) acceptable to Purchaser, and appoint a Bank acceptable to Purchaser, to obtain electronic fund transfer services and/or Automated Clearing House (“ACH”) payments for the Merchant’s Account at the Bank approved by Purchaser (the “Account”). Merchant shall provide Purchaser and/or its authorized agent(s) with all of the information, authorizations and passwords necessary for verifying Merchant’s receivables, receipts, deposits and withdrawals into and from the Account. Merchant shall authorize Purchaser and/or its agent(s) to deduct the Account the amounts owed to Purchaser for the Future Receipts as specified herein from settlement amounts which would otherwise be due to Merchant from electronic check transactions and to pay such amounts to Purchaser by permitting Purchaser to withdraw the specified percentages by ACH debiting of the Account. The authorization shall be irrevocable absent Purchaser’s written consent.
1.2. Term of Agreement. This Agreement shall remain in full force and effect until the entire Purchased Amount is received by Purchaser as per the terms of this Agreement, however, at any time during the term of this Agreement, Merchant may terminate this Agreement upon ninety (90) days’ prior written notice (effective upon actual receipt by Purchaser), however, said termination of this Agreement shall not affect Merchant’s responsibility to satisfy any and all outstanding obligations to Purchaser at the time of termination. Notwithstanding the preceding sentence, should Merchant elect to terminate this Agreement in accordance with this Paragraph 1.2 herein but Merchant shall fail to fully satisfy its obligation to Purchaser, then Merchant’s termination shall be null and void and have no force and effect, and this Agreement shall remain in full force and effect.
1.3. Future Purchases. Purchaser reserves the right to rescind the offer to make any purchase payments hereunder, in its sole and absolute discretion.
1.4. Reconciliation of Specific Daily Amount. The specific daily amount represents the Specific Percentage of Merchant’s Future Receipts. Merchant may request that Purchaser reconcile Merchant’s actual Future Receipts by either crediting or debiting the difference back to or from the Account so that Purchaser so that the amount Purchaser debited in the most recent calendar month equaled the Specified Percentage of Future Receipts that Company collected in that calendar month. Any reconciliation request must be (i) in writing; (ii) include a complete copy of Merchant's bank statement for the calendar month at issue; and (iii) be sent to Purchaser at 4 Davenport Avenue, Greenwich CT, 06830 within thirty (30) calendar days after the last day of the calendar month at issue. Merchant acknowledges and agrees that it is the Merchant's sole responsibility to send a complete bank statement. The Merchant’s failure and/or refusal to send a written reconciliation request within forty-five (45) days of the last day of the calendar month at issue will result in the forfeiture of said month’s reconciliation.
1.5. Financial Condition. Merchant and Guarantor(s) (as hereinafter defined) authorize Purchaser and its agents to investigate their financial responsibility and history and will provide to Purchaser any bank or financial statements, tax returns, and other relevant information, as Purchaser deems necessary in its sole and absolute discretion prior to or at any time after execution of this Agreement. A photocopy of this authorization will be deemed as acceptable as an authorization for release of financial information. Purchaser is authorized to update such information and financial profiles from time to time as it deems appropriate.
1.6. Transactional History; Card Processor. Merchant authorizes all of their banks and brokers to provide Purchaser with Merchant’s banking, brokerage and/or processing history, including, but not limited to, credit card processing, to determine qualification or continuation in this program. Merchant agrees to enter into a payment card processing agreement with a payment card processor approved by Purchaser (the “Processor”) in order to obtain card processing services for credit cards, charge cards, debit cards, prepaid cards, or other payment cards used to purchase Merchant's goods and/or services. If Merchant has entered into a payment card processing agreement before the date of this Agreement, Merchant may request that Purchaser review such agreement and any other information it deems pertinent for approval of the existing payment card processor in the sole and absolute discretion of Purchaser.
1.7. Indemnification. Merchant and Guarantor(s) jointly and severally indemnify and hold harmless Processor, its officers, directors and shareholders against all losses, damages, claims, liabilities and expenses (including reasonable attorney’s fees) incurred by Processor resulting from (a) claims asserted by Purchaser for monies owed to Purchaser from Merchant and (b) actions taken by Processor in reliance upon information or instructions provided by Purchaser.
1.8. No Liability. In no event will Purchaser be liable for any claims asserted by Merchant or Guarantor under any legal theory for lost profits, lost revenues, lost business opportunities, exemplary, punitive, special, incidental, indirect or consequential damages, each of which is waived by Merchant and Guarantor(s). In the event these claims are nonetheless raised, Merchant and Guarantor(s) will be jointly and severally liable for all of Purchaser’s legal fees and expenses resulting therefrom.
1.9. Reliance on Terms. Sections 1.1, 1.8, 1.9 and 2.5 of this Agreement are agreed to for the benefit of Merchant, Purchaser and Processor, and notwithstanding the fact that Processor is not a party of this Agreement, Processor may rely upon their terms and raise them as a defense in any action.
1.10. Sale of Future Receipts. Merchant is selling a portion of a Future Receipts to Purchaser at a discount, nor borrowing money from Purchaser. Merchant agrees that the Purchase Price is in exchange for the Future Receipts pursuant to this Agreement, and that it equals the fair market value of such Future Receipts. There is no interest rate or payment schedule and not time period during which the Purchase Amount must be collected by Purchaser. Merchant going bankrupt or going out of business, in and of itself, does not constitute a breach of this Agreement. Purchaser is entering into this Agreement knowing the risks that Merchant’s business may slow down or fail, and Purchaser assumes these risks based on Merchant’s representations, warranties and covenant in this Agreement, which are designed to give Purchaser a reasonable and fair opportunity to receive the benefit of its bargain. Merchant and Purchaser agree that the Purchase Price under this Agreement is in exchange for the Purchased Amount and that such Purchase Price is not intended to be, nor shall it be construed as a loan or otherwise borrowing money from Purchaser to Merchant. Merchant agrees that the Purchase Price is in exchange for the Future Receipts purchased pursuant to this Agreement and further that the Future Receipts equal the fair market value of such Future Receipts. Purchaser has purchased and shall own all the Future Receipts described in this Agreement up to the full Purchased Amount as the Future Receipts are created. Payments made to Purchaser in respect to the full amount of the Future Receipts shall be conditioned upon Merchant’s sale of products and services and the payment therefore by Merchant’s customers in the manner provided in Section 1.1. In no event shall the aggregate of all amounts or any portion thereof be deemed as interest hereunder and in no event, if is found to be interest despite the parties hereto specifically that it is NOT interest – it shall be found that no sum charged or collected hereunder shall exceed the highest rate permissible at law. In the event that a court nonetheless determines that Purchaser has charged or received interest hereunder in excess of the highest rate allowed by law, then the rate in effect hereunder shall automatically be reduced to the maximum rate permitted by applicable law and Purchaser shall promptly refund to Merchant any interest received by Purchaser in excess of the maximum lawful rate, it being intended that Merchant not pay or contract to pay, and that Purchaser not receive or contract to receive, directly or indirectly in any manner whatsoever, interest in excess of that which may be paid by Merchant under applicable law. As a result, Merchant knowingly and willingly waives the defense of usury in any action or proceeding with respect to this Agreement.
1.11. Power of Attorney. Merchant irrevocably appoints Purchaser as its agent and attorney-in-fact with full authority to take any action or execute any instrument or document to settle all obligations due to Purchaser from Processor, or in the case of a violation by Merchant of Section 1.12 or the occurrence of an Event of Default under Section 4 hereof, from Merchant, under this Agreement, including without limitation: (i) to obtain and adjust insurance; (ii) to collect monies due or to become due under or in respect of any of the Collateral; (iii) to receive, endorse and collect any checks, notes, drafts, instruments, documents or chattel paper in connection with clause (i) or clause (ii) above; (iv) to sign Merchant’s name on any invoice, bill of lading, or assignment directing customers or account debtors to make payment directly to Purchaser; and (v) to file any claims or take any action or institute any proceeding which Purchaser may deem necessary for the collection of any of the unpaid Purchased Amount from the Collateral, or otherwise to enforce its rights with respect to payment of the Purchased Amount. In connection therewith, all costs, expenses and fees, including, but not limited to, attorney’s fees, shall be payable by and from Merchant, and Purchaser is authorized to use Merchant’s funds to pay for same.
1.12. Protections Against Default. In the event: (a) Merchant takes any action to discourage the use of electronic check processing that are settled through Processor, or permits any event to occur that could have an adverse effect on the use, acceptance, or authorization of checks or other payments or deposits for the purchase of Merchant’s services and products, including but not limited to, direct deposit of any checks into a bank account without scanning into the Purchaser electronic check processor; (b) Merchant changes its arrangements with Processor in any way that is adverse or acceptable to Purchaser; (c) Merchant changes the electronic check processor through which the Future Receipts are settled from Processor to another electronic check processor, or permits any event to occur that could cause diversion of any of Merchant’s check or deposit transactions to another processor; (d) Merchant interrupts the operation of its business (other than adverse weather, natural disasters or acts of God) transfers, moves, sells, disposes, transfers or otherwise conveys its business and/or assets without (i) the express prior written consent of Purchaser, which may be withheld in its sole and absolute discretion; and (ii) the written agreement of any purchaser or transferee to the assumption of all of Merchant’s obligations under this Agreement pursuant to documentation satisfactory to Purchaser; or (e) Merchant takes any action, fails to take any action, or offers any incentive (economic or otherwise), the result of which will be to induce any customer or customers to pay for Merchant’s services with any means other than payments, checks, or deposits that are settled through Processor, the following protections enumerated below may be invoked by Purchaser, immediately and without notice to Merchant:
| (1) | The full uncollected Purchase Amount plus all fees due under this Agreement, including, but not limited to, attorney’s fees, and the security agreement executed by Merchant (the “Security Agreement”) become due and payable in full immediately. |
| (2) | Purchaser may enforce the provisions of a personal guaranty (the “Guaranty”) against the listed guarantor(s). |
| (3) | Merchant may request Purchaser to deliver an executed confession of judgment in favor of Purchaser in the amount of the Purchase Amount stated in the Agreement. Upon breach of any provision in this Paragraph 1.12 or an Event of Default of this Agreement, Purchaser may enter that confession of judgment as a judgment with the clerk of the court and execute thereon. |
| (4) | Purchaser may enforce its security interest in the Collateral (as defined in the Security Agreement) identified in the Security Agreement herein. |
| (5) | Purchaser may proceed to protect and enforce its rights and remedies in law or at equity. In any such proceeding in which Purchaser shall recover judgment against Merchant, Merchant shall be liable for all of Purchaser’s costs and expenses, including but not limited to, attorneys’ fees, incurred in any proceeding pursued against Merchant to recover any and all amounts due to Purchaser under this Agreement. |
| (6) | Purchaser may debit Merchant’s depository accounts wherever situated by means of ACH debit or facsimile signature on a computer-generated check drawn on Merchant’s Account or otherwise, in an amount consistent with the Specified Percentage or Specific Daily Amount or for all sums due to Purchaser. |
| (7) | Purchaser shall have the right, without waiving any of its rights and remedies and without notice to Merchant and/ or Guarantor(s), to notify Merchant’s credit card processor of the sale of Future Receipts hereunder and to direct such credit card processor to make payment to Purchaser of all or any portion of the amounts received by such credit card processor on behalf of Merchant. Merchant hereby grants to Purchaser an irrevocable power-of-attorney, which power-of-attorney shall be coupled with an interest, and hereby appoints Purchaser or any of Purchaser representatives as Merchant’s attorney-in-fact, to take any and all action necessary to direct such new or additional Processor to make payment to Purchaser as contemplated by this Section. |
| (8) | The entire Purchase Amount and all fees, including, but not limited to, attorney’s fees and costs, shall become immediately refundable and payable to Purchaser from Merchant. |
The above protections are in addition to any other remedies available to Purchaser at law, in equity or otherwise pursuant to this Agreement.
1.13. Protection of Information. Merchant, and each person signing this Agreement on behalf of Merchant and/or as Owner or Guarantor, in respect of himself or herself personally, authorizes Purchaser to disclose information concerning Merchant’s and each Owner’s and/or Guarantor(s)’s credit standing and business conduct only, to agents, affiliates, subsidiaries, and credit reporting bureaus. Merchant, Guarantor(s) and each Owner(s) hereby waives to the maximum extent permitted by law any claim for damages against Purchaser or any of its affiliates relating to any (i) investigation undertaken by or on behalf of Purchaser as permitted by this Agreement; or (ii) disclosure of information as permitted by this Agreement.
1.14. Confidentiality. Merchant understands and agrees that the terms and conditions of the products and services offered by Purchaser, including, but not limited to, this Agreement, and any other Purchaser documentations (collectively, “Confidential Information”) are proprietary and confidential information of Purchaser. Accordingly, unless disclosure is required by law or court order, Merchant shall not disclose Confidential Information of Purchaser to any person other than an attorney, accountant, financial advisor or employee of Merchant who needs to know such information for the purpose of advising Merchant (“Advisor”), provided such Advisor uses such information solely for the purpose of advising Merchant and first agrees in writing to be bound by the terms of this Section
1.14. A breach of this Paragraph 1.14 shall entitle Purchaser to any and all available remedies at law and equity, including, but not limited to, damages, attorney’s fees and costs, a temporary restraining order, and preliminary injunction, without the necessity to post a bond or other security.
1.15. Publicity. Merchant and each of Merchant’s Owners and all Guarantors hereto authorize Purchaser to use its, his or her name in listings of clients and in advertising and marketing materials.
1.16. D/B/A’s. Merchant hereby acknowledges and agrees that Purchaser may be using “doing business as” or “d/b/a” names in connection with various matters relating to the transaction between Purchaser and Merchant, including the filing of UCC-1 financing statements and other notices or filings.
| 1.17. | Application of Payments. Subject to applicable law, Purchaser reserves the right to apply payments in any manner Purchaser chooses. |
1.18. Inspection of Collateral and Place of Business. Purchaser, or its designated representatives and agents, shall have the right, during Merchant's normal business hours and at any other reasonable times and without notice to Merchant, to examine the Collateral wherever located and the interior and exterior of any of Merchant's places of business. Any such examination of any of Merchant's business may include, but is not limited to, whether Merchant: (i) has a place of business that is separate from any personal residence; (ii) is open for business; (iii) has sufficient inventory to conduct its business; and (iv) has one or more point-of-sale terminals to process credit card transactions. When performing an examination, Purchaser or its designated representatives and agents may photograph the interior and exterior of any of Merchant's places of business, including, but not limited to, any signage and point-of-sale terminals, and may photograph any Principal of the Merchant.
1.19. Monthly Fees. In addition to the other fees provided for in this Agreement, Purchaser shall be entitled, without notice or invoice, to a nonrefundable monthly fee of $0.00 to be collected via ACH Debit and which shall be due for each month, or portion thereof, during the tenure of this Agreement. Said fee shall be due and owing after the first month from the date of this Agreement and on every month thereafter during such time Purchaser has not received the Purchase Amount in full (the “Monthly Fee”). Each Monthly Fee shall be earned upon Purchaser's receipt thereof in consideration of Purchaser's accepting this engagement and servicing the instant transaction as described herein and shall in no way be deemed to represent a diminution of the purchase price set forth herein.
1.20. Prepayment. Although there is no obligation to do so, Merchant may prepay any amount towards the Purchased Amount without penalty. Merchant may elect to terminate this Agreement by prepaying Purchaser the amount of the balance of the Purchased Amount at any time.
ARTICLE II: REPRESENTATIONS, WARRANTIES AND COVENANTS
Merchant hereby represents, warrants and covenants that as of this date and during the term of this Agreement:
2.1. Financial Condition and Financial Information. Merchant’s and Guarantor’s bank and financial statements, copies of which have been furnished to Purchaser, and future statements which will be furnished hereafter at the discretion of Purchaser, accurately represent the financial condition of Merchant at such dates, and since those dates there has been no material adverse changes, financial or otherwise, in such condition, operation or ownership of Merchant. Merchant and Guarantors have a continuing, affirmative obligation to advise Purchaser of any material adverse change in its financial condition, operation or ownership. Purchaser may request statements at any time during the performance of this Agreement and the Merchant shall provide them to Purchaser within five (5) business days. Merchant’s failure to do so shall constitute a material breach and Event of Default (as defined below) of this Agreement. Merchant is financially solvent (i.e., the assets that Merchant owns exceed the value of Merchant’s liabilities and Merchant is able to pay its obligations as they come due) as of the date of this Agreement. Merchant fully anticipates that Merchant will remain solvent throughout the term of this Agreement.
2.2. Governmental Approvals. Merchant is in good standing in the jurisdiction(s) in which it engages in business, is in compliance and shall at all times comply with all laws and has valid permits, authorizations and licenses to own, operate and lease its properties and to conduct the business in which it is presently engaged. Merchant possesses and is in compliance with all permits, licenses, approvals, consents and other authorizations necessary to conduct its business.
2.3. Authorization. Merchant, and the person(s) signing this Agreement on behalf of Merchant, have full power and authority to incur and perform the obligations under this Agreement, all of which have been duly authorized. The execution of this Agreement does not conflict with and is not in violation of any of Merchant’s governing documents, any other agreement to which Merchant is a party, or any other matters by which Merchant is bound and/or regulated, including, but not limited to, articles of organization, by-laws, rules and regulations, charter, any contracts, policy statements, handbooks, wills, trusts, other testamentary instruments, and/or court orders.
2.4. Insurance. Merchant will maintain general liability and business-interruption insurance naming Purchaser as loss payee and additional insured in amounts and against risks as are satisfactory to Purchaser and shall provide Purchaser proof of such insurance upon request.
2.5. Electronic Check Processing Agreement. Merchant will not change its Processor, add terminals, change its financial institution or bank account(s) or take any other action that could have any adverse effect upon Merchant’s obligations under this Agreement, without Purchaser’s prior written consent, which consent may be withheld in its absolute discretion. Any such change shall be a material breach and Event of Default of this Agreement. Merchant shall not change or close Merchant’s Account, or credit card processor through which the major credit cards are settled from Processor to another credit card processor, cease or change its payment instruction or other arrangements with Processor or to permit any event to occur that could cause a diversion of any of Merchant’s credit and/or debit card transactions to another processing company without Purchaser’s prior written consent, which may be withheld, denied, and/or conditioned in Purchaser’s sole and absolute discretion. In the event that Merchant changes its Purchaser-approved Processor without Purchaser’s written consent, Merchant shall, in addition to paying any other damages suffered by Purchaser, pay to Purchaser the Blocked Account Fee set forth in the attached Fee Structure Addendum as liquidated damages, as it will be impracticable or extremely difficult to determine the resulting damages suffered by Purchaser.
2.6. Change of Name or Location. Merchant will not conduct Merchant’s businesses under any name other than as disclosed to the Processor and Purchaser or change any of its places of business without prior written consent of Purchaser, which consent may be withheld in its sole and absolute discretion.
2.7. Daily Batch Out. Merchant will batch out Future Receipts with the Processor on a daily basis.
2.8. Estoppel Certificate. Merchant will at any time, and from time to time, upon at least one (1) day’s prior notice from Purchaser to Merchant, execute, acknowledge and deliver to Purchaser and/or to any other person, person firm or corporation specified by Purchaser, a statement certifying that this Agreement is unmodified and in full force and effect (or, if there have been modifications, that the same is in full force and effect as modified and stating the modifications) and stating the dates which the Purchased Amount or any portion thereof has been repaid.
2.9. No Pending Bankruptcy. As of the date of this Agreement, Merchant does not contemplate and has not filed any petition for bankruptcy protection under Title 7, 11 or 13 of the United States Code and there has been no involuntary petition brought or pending against Merchant. Merchant further warrants and represents that it does not anticipate filing any such bankruptcy petition and it does not anticipate that an involuntary petition will be filed against it. A Merchant filing for bankruptcy protection or is placed under an involuntary filing shall immediately result in an Event of Default under this Agreement, the implementation of any of the protections of Paragraph 1.11 of this Agreement, shall be permitted by Purchaser. Merchant further warrants and represents that it has not consulted with a bankruptcy attorney or debt consolidation company within the past twelve (12) months. Merchant is not contemplating commencing any case seeking protection under any bankruptcy or insolvency law.
2.10. Working Capital Funding. Merchant shall not enter into any arrangement, agreement, or commitment that relates to or involves the Future Receipts, whether in the form of a purchase of, a loan against, collateral against or the sale or purchase of credits against, Future Receipts or future check sales with any other party other than Purchaser.
2.11. Unencumbered Future Receipts. Merchant has good, complete, unencumbered and marketable title to all Future Receipts, free and clear of any and all liabilities, liens, claims, changes, charges, restrictions, conditions, options, rights, mortgages, security interests, equities, pledges and encumbrances of any kind or nature whatsoever or any other rights or interests that may be inconsistent with the transactions contemplated with, or adverse to the interests of Purchaser. Merchant has not granted a security interest in any of its Future Receivables to any third party except as disclosed to Purchaser in writing prior to the execution of this Agreement. Merchant shall not grant a security interest in any of its Future Receivables without Purchaser’s advance written consent, which may be withheld, denied, and/or conditioned in Purchaser’s sole and absolute discretion. The Future Receivables are owned solely by Merchant and are not assigned, conveyed, or encumbered except for the sale to Purchaser as provided for in this Agreement. Merchant shall not sell, dispose, convey, assign, pledge, hypothecate, transfer, or otherwise encumber all or any portion of Merchant’s business, Merchant’s Future Receivables, and/or Merchant’s assets without the prior written consent of Purchaser which may be withheld, denied, and/or conditioned in Purchaser’s sole and absolute discretion.
2.12. Business Purpose; No Change of Business. Merchant is a valid business, in good standing under the laws of the jurisdictions in which it is organized and/or operates, and Merchant is entering into this Agreement for business purposes and not as a consumer for personal, family or household purposes. You will not materially change the goods or services you sell, materially change the nature of your business, change the business entity through which you carry on your business, change any of the locations where you operate your business, or change the name under which you do business without first notifying us and obtaining our prior written consent.
2.13. Default Under Other Contracts. Merchant’s execution of, and/or performance under this Agreement will not cause or create an event of default by Merchant under any contract with another person or entity. Merchant is not in default of any agreement with any creditor with which it established a relationship prior to the execution of this Agreement, nor has Merchant entered into any forbearance agreement with a creditor unless it has been previously disclosed to Purchaser, and to which Purchaser consented in writing.
2.14. Good Faith, Best Efforts and Due Diligence. Merchant and Guarantor(s) hereby affirm that it will conduct its business in good faith and will expend its best efforts to maintain and grow its business, to ensure that Purchaser obtains the Purchased Amount. Merchant will (i) conduct its business consistent with past practice; (ii) not incur any debt over $100,000.00 without Purchaser’s prior written consent which may be withheld, denied, and/or conditioned in Purchaser’s sole and absolute discretion; (iii) not commit fraud; (iv) not make materially false statements; and, (v) not withhold information from Purchaser necessary for the effective consummation for the transactions contemplated in this Agreement. Furthermore, Merchant and Guarantor(s) hereby acknowledge, agree, warrant and represent that it they will perform all appropriate due diligence and credit checks of all of the customers’ finances, cash flow, solvency, good faith, pay histories and business reputations (“Due Diligence Requirements”) as may suffice to ensure any and all products and/or services provided, sold or delivered by Merchant to said customers will be paid for by customers in full and in a timely manner, and will not result in the creation of an unpaid account. These Due Diligence Requirements must be performed prior to any sales to any customer, and repeated no less frequently than monthly for so long as any sums are due from these customers. Full documentation of all of Merchant’s compliance with its Due Diligence Requirements must be maintained in Merchant’s files so long as Purchaser has not fully collected all sums due under this Agreement. This is not a guaranty of payment by customers, but is a guaranty of full, adequate and good faith due diligence investigation and credit check of customers before extending credit to them and continuing no less frequently than monthly so long as sums are still due and owing.
2.15. Payment Methods. Merchant is a business that regularly accepts payments from credit cards, debit cards, bank cards, gift cards, and charge cards as a means by which its customers pay Merchant for amounts due whether for goods sold, services rendered, or in satisfaction of other amounts owed. Furthermore, Merchant shall not take any action to discourage the use of credit cards, debit cards, bank cards, gift cards, and charge cards which are settled though Processor or to permit any event to occur which could have an adverse effect on the use, acceptance, or authorization of credit cards, debit cards, bank cards, gift cards, and charge cards for the purchase of Merchant’s services and products. Any and all payment processing terminals and/or point of sale systems shall be approved by Purchaser and programmed to process only through Processor.
2.16. Read-Only Access to Bank Account. Merchant hereby agrees that, until Purchaser has received the Purchase Amount, Purchaser shall have the right to perform ongoing read-only electronic monitoring of transactions occurring in the approved Account and Merchant's account with the Processor. Merchant agrees to provide Purchaser all required online access codes for the Account. If Purchaser's electronic (online) access to Merchant's Account or is disabled for any reason, Merchant shall immediately and diligently undertake all steps required of it to restore Purchaser's access to both accounts.
2.17. Accounting Records and Tax Returns. Merchant shall treat receipt of the Purchase Amount and delivery of the Specified Percentage of Future Receipts in a manner consistent with its nature as a true sale of Future Receipts in its accounting records and tax returns and further agrees that Purchaser is entitled to audit Merchant's accounting records upon reasonable notice in order to verify compliance. Merchant hereby waives any rights of privacy, confidentiality, or taxpayer privilege in any litigation or arbitration arising out of this Agreement in which Merchant asserts that this transaction is anything other than a sale of future receipts.
2.18. No Other Assignment or Sale of Receivables. Merchant has not entered into any other agreement for the sale of Future Receivables and/or cash advance agreements except as disclosed to Purchaser in writing prior to the execution of this Agreement. Merchant has not and shall not enter into any other agreement for the sale of Future Receivables and/or cash advance agreements without Purchaser’s advance written consent, which may be withheld, denied, and/or conditioned in Purchaser’s sole and absolute discretion. Merchant has not accepted and shall not accept any cash advances absent Purchaser’s advance written consent, which may be withheld, denied, and/or conditioned in Purchaser’s sole and absolute discretion. Merchant has not entered into any financing or factoring agreement, except as disclosed to Purchaser in writing prior to the execution of this Agreement. Merchant shall not enter into any financing or factoring agreement without Purchaser’s advance written consent, which may be withheld, denied, and/or conditioned in Purchaser’s sole and absolute discretion. Merchant acknowledges and agrees that this is not a loan and agrees that it will not enter into any agreement with a third party that offers debt restructuring, debt settlement, debt management, debt balance reduction, creditor reduction, creditor negotiation, financial mitigation, or other similar services, as they are not applicable to this Agreement.
2.19. Insufficient Funds. In the event that Merchant’s Bank Account does not have adequate funds available to cover the Daily Retrieval to be delivered to Purchaser, Merchant must provide advance written notice to Purchaser. If any attempted ACH debit is rejected because the account is considered to have Non-Sufficient Funds (hereafter “NSF”) then Purchaser will assess the NSF Fee set forth in the Fee Structure Addendum per each occurrence, to be automatically debited from Merchant’s Bank Account.
2.20. Ongoing ACH Authorization. Merchant shall not attempt to revoke its ACH authorization to Purchaser set forth in this Agreement or otherwise take any measure to interfere with Purchaser’s ability to collect the Daily Retrieval or any other monies that Purchaser is otherwise entitled to receive pursuant to this Agreement.
2.21. Maintenance of Accounts; Access. Merchant shall not close Merchant’s Bank Account or the Approved Account (or change the bank account into which Processor deposits the Future Receivables) to another account without Purchaser’s prior written consent, which may be withheld, denied, and/or conditioned in Purchaser’s sole and absolute discretion. In the event that Merchant changes Merchant’s Bank Account or the Approved Account without Purchaser’s prior written consent, Merchant shall, in addition to paying any other damages suffered by Purchaser, pay to Purchaser the Blocked Account Fee as liquidated damages, as it will be impracticable or extremely difficult to determine the resulting damages suffered by Purchaser. Merchant shall not take any action to block Purchaser’s access Merchant’s Account. Merchant must provide updated login information for Merchant’s Account within twenty-four (24) hours of any login change.
2.22. No Lawsuits, Judgments or Liens. Merchant is not a party to any lawsuit and is not aware of any claims, actions, proceedings, and/or circumstances that would cause any of the Purchased Amount to not be fully collectible. There are no judgments or liens against Merchant.
2.23. No Closing of Business. Merchant represents and warrants that it has no current plans to close its business either temporarily (for renovations, repairs or any other purpose), or permanently. Merchant agrees that, until Purchaser receives the Purchase Amount, Merchant will not voluntarily close its business on a permanent or temporary basis for renovations, repairs, or any other purposes. Notwithstanding the foregoing, Merchant shall have the right to close its business temporarily if such closing is necessitated by a requirement to conduct renovations or repairs imposed upon Merchant's business by legal authorities having jurisdiction over Merchant's business (such as from a health department or fire department) or if such closing is necessitated by circumstances outside Merchant's reasonable control. Prior to any such temporary closure of its business, Merchant shall provide Purchaser ten (10) business days' advance notice, or as much notice as reasonably possible under the circumstances.
2.24. Taxes. Merchant has paid, and will continue to pay, all necessary local, state, and federal taxes and fees, including, without limitation, income, employment, sales and use taxes, imposed upon Merchant's business by law, and will maintain workers compensation insurance required by applicable governmental authorities.
2.25. Compliance with U.S Export Laws. Neither Merchant, its constituents or affiliates, nor any of their respective agents, is in violation of any law relating to terrorism or money laundering, including, but not limited to, Executive Order No. 13224 on Terrorist Financing, the U.S. Bank Secrecy Act, as amended by the Patriot Act, the Trading with the Enemy Act, the International Emergency Economic Powers Act and all regulations promulgated thereunder, all as amended from time to time.
2.26. Compliance with Laws. Merchant is in compliance with any and all applicable federal, state, and local laws, rule, and regulations.
Merchant understands that: (i) the foregoing representations, warranties, and covenants of Merchant are a fundamental condition to induce Purchaser to enter into this Agreement; (ii) Purchaser is relying on these representations, warranties, and covenants of Merchant in entering into this Agreement; and, (iii) Purchaser would not make any payment of any Purchase Price to Merchant hereunder if any of the foregoing representations, warranties, and covenants were not accurate and truthful, including, without limitation, that the proceeds are or were to be used for anything other than for business purposes of Merchant in the ordinary course of Merchant’s business.
ARTICLE III: EVENTS OF DEFAULT AND REMEDIES
3.1. Events of Default. The occurrence of any of the following events shall constitute an “Event of Default” hereunder: (a) Merchant or Guarantor shall violate any term or covenant in this Agreement; (b) Any representation or warranty by Merchant in this Agreement shall be incorrect, false or misleading in any material respect when made, as determined in the reasonable discretion of Purchaser; (c) Merchant interferes with Purchaser’s right to collect the Specific Daily Amount (and payment for arrears, if any) in violation of this Agreement; (d) Merchant admits in writing its inability to pay its debts, or shall make a general assignment for the benefit of creditors; or any proceeding shall be instituted by or against Merchant seeking to adjudicate it a bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, or composition of it or its debts; (e) the sending of notice of termination by Merchant or Guarantor(s); (f) Merchant shall transport, move, interrupt, suspend, dissolve or terminate its business; (g) Merchant shall transfer or sell all or substantially all of its assets; (i) Merchant shall make or send notice of any intended bulk sale or transfer by Merchant; (j) Merchant shall use multiple depository accounts without the prior written consent of Purchaser, which consent may be withheld in its sole and absolute discretion; (k) Merchant shall change its depositing account without the prior written consent of Purchaser, which consent may be withheld in its sole and absolute discretion; (l) Merchant shall perform any act that reduces the value of any Collateral granted under this Agreement; (m) Merchant shall default under any of the terms, covenants and conditions of any other agreement with Purchaser; or (n) Merchant shall fail to deposit its Future Receipts into the Account.
3.2. Personal Guaranty. In the Event of Default under any provision of this Agreement, should Purchaser determine that the Purchase Amount cannot be obtained from the Merchant’s business, Purchaser will enforce its rights against the Guarantor(s) of this transaction. Said Guarantor(s) shall be jointly and severally liable to Purchaser for all of Purchaser’s losses and damages, including, but not limited to, all costs, expenses, legal fees, and the balance of the Purchase Amount, if any.
3.3. Remedies. During an Event of Default, Purchaser may proceed to protect and enforce its rights or remedies in equity or by action at law, or both, whether for the specific performance of any covenant, agreement or other provision contained herein, or to enforce the discharge of Merchant’s obligations hereunder (including, but not limited to enforcement of the Guaranty) or any other legal or equitable right or remedy. All rights, powers and remedies of Purchaser in connection with this Agreement may be exercised at any time by Purchaser after the occurrence of an Event of Default, are cumulative and not exclusive, and shall be in addition to any other rights, powers or remedies provided by law or equity.
3.4. Costs. Merchant shall pay to Purchaser all reasonable costs associated with (a) a breach by Merchant in accordance with any of the provisions contained in this Agreement and the enforcement thereof; and (b) the enforcement of any and all of Purchaser’s remedies set forth in this Agreement, including but not limited, to court costs and attorneys’ fees.
3.5. Required Notifications. Merchant is required to give Purchaser written notice within twenty-four (24) hours of any filing under Title 7, 11 or 13 of the United States Code. Merchant is required to give Purchaser seven (7) days’ written notice prior to the closing of any sale of all or substantially all of the Merchant’s assets or stock.
ARTICLE IV: MISCELLANEOUS
4.1 Modifications; Agreements. No modification, amendment, waiver or consent of any provision of this Agreement shall be effective unless the same shall be in writing and signed by both parties.
4.2. Assignment. Purchaser may assign, transfer or sell its rights to receive the Purchased Amount or delegate its duties hereunder, either in whole or in part. Merchant may not assign, transfer or sell any portion of this Agreement without the prior written consent of Purchaser, which consent may be withheld in its sole and absolute discretion.
4.3. Notices. Unless otherwise specified herein, all notices, requests and other communications hereunder shall be in writing and shall be deemed to have been duly given (i) upon receipt when delivered by hand, or (ii) upon date of postmark when sent by certified mail, postage prepaid, return receipt requested (or by such comparable method including overnight express delivery services), or (iii) upon the date of delivery by electronic mail, or (iv) three (3) days after postmark when mailed as aforesaid, at the respective addresses of the parties set forth in this Agreement (or to such other address or facsimile number for receipt of notices as a party may hereafter designate by notice given in accordance with this Section 4.3).
4.4. Waiver; Remedies. No failure on the part of Purchaser to exercise, and no delay in exercising, any right under this Agreement, shall operate as a waiver thereof, nor shall any single or partial exercise of any right under this Agreement preclude any other or further exercise thereof or the exercise of any other right. The remedies provided hereunder are cumulative and not exclusive of any remedies provided by law or equity.
4.5. Binding Effect; Governing Law, Venue, Jurisdiction and Service of Process. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns, except that Merchant shall not have the right to assign its rights hereunder or any interest herein without the prior written consent of Purchaser which consent may be withheld in Purchaser’s sole discretion. MERCHANT AND ANY GUARANTOR(S) HEREBY CONSENT AND AGREE THAT THE STATE OR FEDERAL COURTS LOCATED IN RICHMOND COUNTY, NEW YORK SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN MERCHANT AND/OR GUARANTOR(S) AND PURCHASER PERTAINING TO THIS AGREEMENT AND/OR THE GUARANTY OR TO ANY MATTER ARISING OUT OF OR RELATED TO THIS AGREEMENT AND/OR THE GUARANTY; PROVIDED, THAT NOTHING IN THIS AGREEMENT SHALL BE DEEMED OR OPERATE TO PRECLUDE PURCHASER FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO COLLECT UPON ITS RIGHTS PURSUANT TO THIS PURCHASE AND SALE OF FUTURE RECEIVABLES AND/OR THE GUARANTY OBLIGATIONS OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF COMPANY. MERCHANT AND GUARANTOR EXPRESSLY SUBMIT AND CONSENT IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND GUARANTOR HEREBY WAIVES ANY OBJECTION THAT IT MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS. GUARANTOR HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND ACNOWLEDGES THAT THE TRANSMITTAL OF DOCUMENTS INSTITUTING ANY SUIT AGAINST MERCHANT AND/OR GUARANTOR MAY BE SERVED UPON PURCHASER, MERCHANT AND/OR GUARANTOR VIA EITHER (I) THE EMAIL ADDRESS LOCATED WITHIN THE PURCHASE AND SALE OF FUTURE RECEIVABLES OR (II) FIRST CLASS OR PRIORITY MAIL DELIVERED BY THE UNITED STATES POSTAL SERVICE VIA THE CONTACT ADDRESS LOCATED WITHIN THE PURCHASE AND SALE OF FUTURE RECEIVABLES; OR (III) ANY OTHER ADDRESS(ES) PROVIDED IN WRITING TO PURCHASER BY ANY MERCHANT OR ANY GUARANTOR, UNLESS ANY APPLICABLE LAW OR RULES PROVIDE OTHERWISE, AND THAT SUCH TRANSMITTAL IS REASONABLY CALCULATED TO APPRISE MERCHANT AND/OR GUARANTOR OF THE PENDENCY OF THE ACTION AND AFFORD IT AN OPPORTUNITY TO RESPOND. EACH MERCHANT AND GUARANTOR ACKNOWLEDGES AND AGREES THAT IT WILL BE PRECLUDED FROM ASSERTING THAT IT DID NOT RECEIVE SERVICE OF PROCESS OR ANY OTHER NOTICE SENT EITHER VIA EMAIL OR MAIL IN ACCORDANCE WITH THIS SECTION 4.5 IF IT DOES NOT FURNISH A CERTIFIED MAIL RETURN RECEIPT SIGNED BY PURCHASER DEMONSTRATING THAT PURCHASER WAS PROVIDED WITH NOTICE OF A CHANGE IN THE CONTACT ADDRESS AS SET FORTH LOCATED WITHIN THE PURCHASE AND SALE OF FUTURE RECEIVABLES. This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regards to any applicable principals of conflicts of law. Any suit, action or proceeding arising hereunder, or the interpretation, performance or breach hereof, shall, if Purchaser so elects, be instituted in any court sitting in Richmond County, New York, (the “Acceptable Forums”). Merchant hereby acknowledges and agrees that the Acceptable Forums are convenient to it, and submits to the jurisdiction of the Acceptable Forums and waives any and all objections to jurisdiction or venue. Should such proceeding be initiated in any other forum, Merchant waives any right to oppose any motion or application made by Purchaser to transfer such proceeding to an Acceptable Forum.
4.6. Survival of Representation, etc. All representations, warranties and covenants herein shall survive the execution and delivery of this Agreement and shall continue in full force until all obligations under this Agreement shall have been satisfied in full and this Agreement shall have terminated.
4.7. Severability. If for any reason any court of competent jurisdiction finds any provisions of this Agreement applicable to the Guarantor to be void or voidable, the parties agree that the court may reform such provision(s) to render the provision(s) enforceable ensuring that the restrictions and prohibitions contained in those provisions shall be effective to the fullest extent allowed under applicable law.
4.8. Advice of Counsel. Merchant and Guarantor(s) acknowledge and agree, that prior to executing this Agreement, have had the opportunity to seek the advice of independent legal counsel and have either obtained the advice of independent legal counsel or affirmatively chosen not to seek the advice of independent legal counsel, and have read and understood all of the terms and provisions of this Agreement. This Agreement shall not be construed against any party by reason of the drafting or preparation hereof.
4.9. Entire Agreement. Any provision hereof prohibited by law shall be ineffective only to the extent of such prohibition without invalidating the remaining provisions hereof. This Agreement, the Security Agreement and Guaranty, and any exhibits and addendums hereto embody the entire agreement between Merchant and Purchaser and supersede all prior agreements and understandings relating to the subject matter hereof.
4.10. JURY TRIAL WAIVER. THE PARTIES HERETO WAIVE TRIAL BY JURY IN ANY COURT IN ANY SUIT, ACTION OR PROCEEDING ON ANY MATTER ARISING IN CONNECTION WITH OR IN ANY WAY RELATED TO THE TRANSACTIONS OF WHICH THIS AGREEMENT IS A PART OR THE ENFORCEMENT HEREOF. THE PARTIES HERETO ACKNOWLEDGE THAT EACH MAKES THIS WAIVER KNOWINGLY, WILLINGLY AND VOLUNTARILY AND WITHOUT DURESS, AND ONLY AFTER EXTENSIVE CONSIDERATION OF THE RAMIFICATIONS OF THIS WAIVER WITH THEIR ATTORNEYS.
4.11. CLASS ACTION WAIVER. THE PARTIES HERETO WAIVE ANY RIGHT TO ASSERT ANY CLAIMS AGAINST THE OTHER PARTY, AS A REPRESENTATIVE OR MEMBER IN ANY CLASS OR REPRESENTATIVE ACTION, EXCEPT WHERE SUCH WAIVER IS PROHIBITED BY LAW AGAINST PUBLIC POLICY. TO THE EXTENT EITHER PARTY IS PERMITTED BY LAW OR COURT OF LAW TO PROCEED WITH A CLASS OR REPRESENTATIVE ACTION AGAINST THE OTHER, THE PARTIES HEREBY AGREE THAT: (1) THE PREVAILING PARTY SHALL NOT BE ENTITLED TO RECOVER ATTORNEYS’ FEES OR COSTS ASSOCIATED WITH PURSUING THE CLASS OR REPRESENTATIVE ACTION (NOT WITHSTANDING ANY OTHER PROVISION IN THIS AGREEMENT); AND (2) THE PARTY WHO INITIATES OR PARTICIPATES AS A MEMBER OF THE CLASS WILL NOT SUBMIT A CLAIM OR OTHERWISE PARTICIPATE IN ANY RECOVERY SECURED THROUGH THE CLASS OR REPRESENTATIVE ACTION.
4.12. Counterparts and Facsimile Signatures. This Agreement can be signed in one or more counterparts, each of which shall constitute an original and all of which when taken together shall constitute one and the same agreement. Signatures delivered via facsimile and/or via Portable Digital Format (PDF) shall be deemed acceptable for all purposes.
| MERCHANT | PURCHASER | |||
| Mahesh Prasad Choudhury | Nebula Asset Holdings LLC | |||
| Print Name: | Mahesh Choudhury | Print Name: | ||
| Title: | VP US Oerations | Title: | ||
| Signature: | /s/ Mahesh Choudhury | Signature: | ||
SECURITY AGREEMENT AND GUARANTY
Merchant’s Legal Name: Aurai LLC, together with all of its subsidiaries including its affiliates and related entities).. known and unknown (“Merchant”)
| D/B/A: |
| Physical Address: | 2 MOUNT ROYAL AVE STE 500 MARLBOROUGH, MA 01752-1960 |
| EIN#: | 01-0566432 |
1. SECURITY INTEREST.
a. Security. To secure Merchant’s payment and performance obligations to Nebula Asset Holdings LLC, a New York limited liability company pursuant to that certain Agreement for Purchase and Sale of Future Receivables executed by and between the above-named Merchant and Purchaser (the “Agreement”), as security for the prompt and complete performance of any and all obligations, covenants, and agreements of Merchant under the Agreement, now or hereafter arising from, out of, or relating to the Agreement, whether direct, indirect, contingent or otherwise (hereinafter referred to collectively as the "Merchant Obligations"), Merchant hereby grants to Purchaser a security interest in all assets now owned, or hereafter acquired, including, without limitation: (a) all accounts, including without limitation, all deposit accounts, accounts-receivable, and other receivables, chattel paper, documents, equipment, general intangibles, instruments, and inventory, as those terms are defined by Article 9 of the Uniform Commercial Code (the “UCC”), now or hereafter owned or acquired by Merchant; and (b) all proceeds, as that term is defined by Article 9 of the UCC (“a” and “b” collectively, the “Collateral”). Merchant understands that Purchaser has the right to take delivery of the Future Receipts purchased as they are generated in the ordinary course of business. The Security Interest granted in this section is being given solely for the purpose of ensuring that Merchant does not take any action to deprives Purchaser of that right. This Security Interest does not mean that Purchaser has made a loan to Merchant, does not create a debt, and does not make Merchant a debtor or Purchaser a creditor.
b. Further Assurances. Merchant and Guarantor(s) each agrees to execute any documents or take any action in connection with this Security Agreement and Guaranty as Purchaser deems necessary or reasonable to perfect or maintain Purchaser’s first priority security interest in the Collateral, including, but not limited to, the execution of any account control agreements. Merchant and Guarantor each hereby authorizes Purchaser to file any financing statements deemed necessary or desirable by Purchaser to perfect or maintain Purchaser’s security interest, which financing statement may contain notification that Merchant and Guarantor(s) each have granted a negative pledge to Purchaser with respect to the Collateral, and that any subsequent lienor may be tortuously interfering with Purchaser’s rights. Merchant and Guarantor(s) shall each be liable for, and Purchaser may charge and collect any and all costs and expenses, including, but not limited to, attorney’s fees, which may be incurred by Purchaser in protecting, preserving and/or enforcing Purchaser’s security interests and rights. Merchant and Guarantor each acknowledge that Purchaser may use another legal name and/or d/b/a when designating the secured party when Purchaser files the above-referenced financing statement(s).
c. Financing Statements. Merchant authorizes Purchaser to file one or more UCC-1 forms consistent with the UCC to give notice that the Amount Sold is the sole property of Purchaser. The UCC filing may state that such sale is intended to be a sale and not an assignment for security and may state that Merchant is prohibited from obtaining any financing that impairs the value of the Amount Sold or Purchaser's ability to collect same. Merchant authorizes Purchaser to debit the Bank, for all costs incurred by Purchaser associated with the filing, amendment or termination of any UCC filings.
d. Negative Pledge. Merchant and Guarantor(s) each agrees not to create, incur, assume, or permit to exist, directly or indirectly, any lien on or with respect to any of the Collateral.
e. Acknowledgement of Security Interest. The Future Receipts sold by Merchant to Purchaser pursuant to this Agreement are "accounts" or "payment intangibles" as those terms are defined in the UCC in effect in the state in which Merchant is located. Such Sale shall constitute and shall be construed and treated for all purposes as a true and complete sale, conveying good title to the Future Receipts free and clear of any liens and encumbrances, from Merchant to Purchaser. To the extent the Future Receipts are "accounts" or "payment intangibles" then (i) the sale of the Future Receipts creates a security interest as defined in the UCC; (ii) this Agreement constitutes a "security agreement" under the UCC; and (iii) Purchaser has all the rights of a secured party under the UCC with respect to such Future Receipts. Merchant further agrees that, with or without an Event of Default, Purchaser may notify account debtors, or other persons obligated on the Future Receipts, on holding the Future Receipts of Merchant's sale of the Future Receipts and may instruct them to make payment or otherwise render performance to or for the benefit of Purchaser.
f. Termination of Pledge. Upon the performance by Merchant in full of the Merchant Obligations, the security interest in the Collateral pursuant to this Pledge shall automatically terminate without any further act of either party being required, and all rights to the Collateral shall revert to Merchant. Upon any such termination, Purchaser will execute, acknowledge (where applicable) and deliver such satisfactions, releases and termination statements, as Merchant shall reasonably request.
g. Representations with Respect to Collateral. Merchant hereby represents and warrants to Purchaser that: the execution, delivery and performance by Merchant of this Pledge, and the remedies in respect of the Collateral under this Pledge (i) have been duly authorized; (ii) do not require the approval of any governmental authority or other third party or require any action of, or filing with, any governmental authority or other third party to authorize same (other than the filing of the UCC-1s); (iii) do not and shall not (A) violate or result in the breach of any provision of law or regulation, any order or decree of any court or other governmental authority, or (B) violate, result in the breach of or constitute a default under or conflict with any indenture, mortgage, deed of trust, agreement or any other instrument to which Merchant is a party or by which any of Merchant's assets (including, without limitation, the Collateral) are bound.
h. Attorney-in-fact. Merchant hereby authorizes Purchaser at any time to take any action and to execute any instrument, including without limitation to file one or more financing statements and/or continuation statements, to evidence and perfect the security interest created hereby and irrevocably appoints Purchaser as its true and lawful attorney-in-fact, which power of attorney shall be coupled with an interest, with full authority in the place and stead of Merchant and in the name of Merchant or otherwise, from time to time, in Purchaser's sole and absolute discretion, including without limitation (a) for the purpose of executing such statements in the name of and on behalf of Merchant, and thereafter filing any such financing and/or continuation statements and (b) to receive, endorse and collect all instruments made payable to Merchant.
2. GUARANTY
a. Personal Guaranty of Performance. The undersigned Guarantor(s) hereby irrevocably, absolutely and unconditionally guarantees to Purchaser, the prompt, full and faithful performance of all of the representations, warranties, covenants made by Merchant in the Agreement and this Security Agreement and Guaranty, as each agreement may be renewed, amended, extended or otherwise modified (the “Guaranteed Obligations”). Guarantor’s obligations are due (i) at the time of any breach by Merchant of any representation, warranty, or covenant made by Merchant in the Agreement and this Security Agreement and Guaranty, and (ii) at the time Merchant admits its inability to pay its debts, or makes a general assignment for the benefit of creditors, or any proceeding shall be instituted by or against Merchant seeking to adjudicate it bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, or composition of it or its debts.
b. Guarantor Waivers. In the event that Merchant fails to make a payment or perform any obligation when due under the Agreement or this Security Agreement and Guaranty, Purchaser may enforce its rights under this Security Agreement and Guaranty without first seeking to obtain payment from Merchant, any other guarantor, or any Collateral Purchaser may hold pursuant to this Agreement or any other guaranty. Guarantor understands that Purchaser will have a security interest in the Collateral upon execution of this Agreement. Additionally, Guarantor waives the right to require Purchaser to: (i) proceed first against Merchant; (ii) proceed against or exhaust any security that Purchaser holds from Merchant; or (iii) pursue any other remedy in Purchaser’s power. Guarantor waives any defense by reason of any disability of Merchant, and waives any other defense based on the termination of Merchant's liability from any cause. Additionally, Guarantor shall have no right to subrogation. Guarantor waives any right to enforce any remedy which Purchaser now has or may hereafter have against Merchant, and waives any benefit of, and any right to participate in any security now or hereafter held by Purchaser. Guarantor waives its right to enforce any remedies that Purchaser now has, or later may have, against Merchant. Guarantor waives any right to participate in any security now or later held by Purchaser. Guarantor waives all presentments, demands for performance, notices of nonperformance, protests, notices of protest, notices of dishonor, and notices of acceptance of this Guaranty, and waives all notices of the existence, creation, or incurring of new or additional obligations. “Guarantor” as used in this Security Agreement and Guaranty include the heirs, executors, personal representatives, successors and assigns of Guarantor. If there is more than one Guarantor, "Guarantor" in this Agreement shall mean all Guarantors and the obligations of the Guarantors hereunder shall be joint and several.
c. Guarantor's Representations. Guarantor represents and warrants to Purchaser that: (i) Guarantor is an owner, officer, or manager of Merchant and will directly benefit from Purchaser and Merchant entering into the Agreement; and (ii) Guarantor understands and acknowledges that Purchaser is not willing to enter into the Agreement unless Guarantor irrevocably, absolutely and unconditionally guarantees prompt and complete performance of any and all liabilities, obligations, covenants or agreements of Merchant under this Agreement, now or hereafter arising from, out of or relating to this Agreement, whether direct, indirect, contingent or otherwise.
d. Guarantor's Other Agreements. Guarantor will not dispose, convey, sell or otherwise transfer, or cause Merchant to dispose, convey, sell or otherwise transfer, any material business assets of Merchant without the prior written consent of Purchaser, which consent may be withheld for any reason, until Purchaser has received the Purchase Amount. Guarantor shall pay to Purchaser upon demand all expenses (including, without limitation, reasonable attorneys' fees and disbursements) incurred as the result of, or incidental to, or relating to, the enforcement or protection of Purchaser's rights against Merchant and Guarantor under the Agreement. This Guaranty is binding upon Guarantor and Guarantor's heirs, legal representatives, successors and assigns and shall inure to the benefit of and may be enforced by the successors an assign of Purchaser. The obligation of Guarantor shall be unconditional and absolute, regardless of the unenforceability of any provision of any agreement between Merchant and Purchaser, or the existence of any defense, setoff or counterclaim, which Merchant may assert. Purchaser is hereby authorized, without notice or demand and without affecting the liability of Guarantor hereunder, to at any time renew or extend Merchant's obligations under the Agreement or otherwise modify, amend or change the terms of the Agreement.
e. Acknowledgment of Purchase. Guarantor acknowledges and agrees that the Purchase Price paid by Purchaser to Merchant in exchange for the Amount Sold is adequate consideration for the purchase of the Purchased Amount and is not a loan or financial accommodation from Purchaser to Merchant. Guarantor specifically acknowledges Purchaser is not a lender, bank, or credit card processor, and that Purchaser has not offered any loans to Merchant. Guarantor waives any claims or defenses of usury in any action arising out of this Agreement.
f. Injunctive Relief. In case any Event of Default occurs and is not waived, Purchaser will be entitled to the issuance of an injunction, restraining order, or other equitable relief in Purchaser’s favor, subject to court or arbitrator approval, restraining each Guarantor’s accounts and/or receivables up to the amount due to Purchaser as a result of the Event of Default, and each Guarantor will be deemed to have consented to the granting of an application for the same to any court or arbitral tribunal of competent jurisdiction without any prior notice to any Merchant or Guarantor and without Purchaser being required to furnish a bond or other undertaking in connection with the application.
g. Counterclaim Waiver. In any litigation or arbitration commenced by Purchaser, each Merchant and each Guarantor will not be permitted to interpose any counterclaim.
3. REMEDIES.
a. Upon a default by Merchant under the terms of either the Agreement or this Security Agreement and Guaranty, Purchaser may (i) pursue any remedy available at law (including, but not limited to, those available under the provisions of the UCC); (ii) or in equity to collect, enforce, or satisfy any obligations then owing, whether by acceleration or otherwise; and (iii) exercise any rights under the Agreement and/or this Security Agreement and Guaranty.
b. Purchaser does not have to notify Guarantor of any of the following events, and Guarantor will not be released from its obligations under this Security Agreement and Guaranty if it is not notified of: (i) Merchant’s failure to pay timely any amount owed under the Agreement; (ii) any adverse change in Merchant’s financial condition or business; (iii) any sale or other disposition of any collateral securing the Guaranteed Obligations or any other guarantee of the Guaranteed Obligations; (iv) Purchaser’s acceptance of this Security Agreement and Guaranty; and (v) any renewal, extension or other modification of the Agreement or Merchant’s other obligations to Purchaser. In addition, Purchaser may take any of the following actions without releasing Guarantor from any of its obligations under this Security Agreement and Guaranty: (i) renew, extend or otherwise modify the Agreement or any of the Merchant’s other obligations to Purchaser; (ii) release Merchant from its obligations to Purchaser; (iii) sell, release, impair, waive or otherwise fail to realize upon any collateral securing the Guaranteed Obligations or any other guarantee of the Guaranteed Obligations; and (iv) foreclose on any collateral securing the Guaranteed Obligations or any other guarantee of the Guaranteed Obligations in a manner that impairs or precludes the right of Guarantor to obtain reimbursement for payment under this Security Agreement and Guaranty. Until the Merchant Amount, plus any accrued but unpaid interest and Merchant’s other obligations to Purchaser under the Agreement and this Security Agreement and Guaranty are paid in full, Guarantor shall not seek reimbursement from Merchant or any other guarantor for any amounts paid by it under this Security Agreement and Guaranty. Guarantor permanently and irrevocably waives and shall not seek to exercise any of the following rights that it may have against Merchant, any other guarantor, or any collateral provided by Merchant or any other guarantor, for any amounts paid by it, or acts performed by it, under this Security Agreement and Guaranty: (i) subrogation; (ii) reimbursement; (iii) performance; (iv) indemnification; or (v) contribution. In the event that Purchaser must return any amount paid by Merchant or any other guarantor of the Guaranteed Obligations because that person has become subject to a proceeding under the United States Bankruptcy Code or any similar law, Guarantor’s obligations under this Security Agreement and Guaranty shall include that amount.
4. SEVERABILITY. If for any reason any court of competent jurisdiction finds any provisions of this Agreement applicable to the Guarantor to be void or voidable, the parties agree that the court may reform such provision(s) to render the provision(s) enforceable ensuring that the restrictions and prohibitions contained in those provisions shall be effective to the fullest extent allowed under applicable law.
5. OPPORTUNITY FOR ATTORNEY REVIEW. The Merchant and Guarantor(s) acknowledge that, in executing this Security Agreement and Guaranty, each has been advised to seek the advice of independent legal counsel. Furthermore, Merchant and Guarantor(s) acknowledge and agree, that prior to executing this Security Agreement and Guaranty, have had the opportunity to seek the advice of independent legal counsel and have either obtained the advice of independent legal counsel or affirmatively chosen not to seek the advice of independent legal counsel, and have read and understood all of the terms and provisions of this Security Agreement and Guaranty. This Security Agreement and Guaranty shall not be construed against any party by reason of the drafting or preparation hereof.
6. NO WAIVER. It is agreed that the delay or failure of Purchaser to insist in any one or more instances upon a strict performance or observance of any of the terms, provisions or covenants of the Agreement or this Security Agreement and Guaranty or to exercise any right therein contained shall not be construed or deemed to be a waiver or relinquishment for the future of such or any other term, provision, covenant or right, but the same shall continue and remain in full force and effect. Holder shall not be deemed by any act of omission or commission, to have waived any of its rights or remedies hereunder unless such waiver is set forth in writing.
7. JOINT AND SEVERAL LIABILITY. The obligations hereunder of the persons or entities constituting Guarantor under this Agreement are joint and several.
8. ATTORNEY’S FEES. If any legal action or other proceeding is brought for the enforcement of this Security Agreement and Guaranty, the prevailing party shall be entitled to recover reasonable attorneys' fees and other costs incurred in that action or proceeding (including attorneys' fees and costs on appeal), in addition to any other relief to which it may be entitled.
IN WITNESS WHEREOF, the undersigned agree to this SECURITY AGREEMENT AND GUARANTY as of the date set forth below:
| MERCHANT | PURCHASER | |||
| Mahesh Prasad Choudhury | Nebula Asset Holdings LLC | |||
| Print Name: | Mahesh Choudhury | Print Name: | ||
| Title: | VP US Oerations | Title: | ||
| Signature: | /s/ Mahesh Choudhury | Signature: | ||
| Date: | 11/07/2025 | Date: | ||
GUARANTOR
| Print Name: | ||
| Title: | ||
| Signature: | ||
| Date: | ||
APPENDIX A: FEE STRUCTURE
| A. | Origination Fee: | $5,400.00 to cover underwriting and related expenses, which shall be deducted from the funded amount. |
| B. | ACH Program Fee: | $0.00 (or 3% of the funded amount, depending on the size of the advance). The ACH program is labor intensive and is not an automated process, requiring us to charge this fee to cover related costs. |
| C. | Non-Sufficient Funds Fee (Standard): |
$100.00 per day for each missed daily debit. If payments are collected on a weekly basis, the NSF fee will be $500.00 per weekly missed (equivalent to five daily pulls). This fee may be assessed up to two (2) times only before an Event of Default is triggered. |
| D. | Rejected ACH or Blocked ACH: |
$2,500.00 when a Merchant blocks the account from Debit ACH or when Merchant directs the bank to reject Purchaser’s debit ACH, which shall result in an Event of Default. |
| E. | Bank Change Fee: | $50.00, If a merchant requires a change of Bank Account to be debited requiring PURCHASER to adjust its system. |
| F. | Blocked Account: | $2,500.00. If a merchant blocks Purchaser’s ACH debit of the Account, bounces more than 4 debits of the Account, or simultaneously uses multiple bank accounts or credit-card processors to process its Future Receipts. |
| G. | Default Fee: | $3,500.00. If a merchant changes Bank Accounts or switches to another credit card processor without Purchaser’s prior written consent, which may be withheld in its sole and absolute discretion, or commits another Event of Default pursuant to the Agreement. |
| H. | Miscellaneous Service Fees: | Merchant shall pay certain fees for services related to the origination and maintenance of accounts. Each Merchant shall receive their funding electronically to their designated Bank Account and will be charged $50.00 for a wire transfer or $0.00 for a bank ACH. Merchant will be charged $25.00 for every additional change of their operating Bank Account once they are active with Purchaser. |
| I. | Risk Assessment Fee: | $249.00 |
| J. | UCC Fee: | $195.00 |
| MERCHANT | PURCHASER | |||
| Mahesh Prasad Choudhury | Nebula Asset Holdings LLC | |||
| Print Name: | Mahesh Choudhury | Print Name: | ||
| Title: | VP US Oerations | Title: | ||
| Signature: | /s/ Mahesh Choudhury | Signature: | ||
| Date: | 11/07/2025 | Date: | ||
ADDENDUM TO AGREEMENT OF PURCHASE AND SALE OF FUTURE RECEIVABLES
This Addendum to the Agreement of Purchase and Sale of Future Receivables (“Addendum”) is entered into this 7 day of November, 2025 (the “Effective Date”), by and between Nebula Asset Holdings LLC, a New York limited liability company (“Purchaser”), and Aurai LLC together with all its subsidiaries including its affiliates and related entities). known and unknown (collectively, “Merchant”) and shall be deemed to amend, modify and supplement that certain Agreement of Purchase and Sale of Future Receivables dated 11/7/25 by and between Purchaser and Merchant (the “Agreement”) (Purchaser and Merchant may herein be referred collectively to as the “Parties”).
NOW, THEREFORE, in consideration of the mutual benefits to be derived from this Addendum and all of the representations, warranties, conditions and promises hereinafter acknowledged and agreed, the Parties agree as follows:
1. In furtherance of the above, Merchant agrees to provide real-time access to any and all of Merchant's bank, deposit or other financial account(s) via Decision LOGIC or similar service (as Purchaser shall from time-to-time utilize) or via the online portal of Merchant’s financial institution(s) (collectively the “Online Bank Access”). It is agreed and understood that Purchaser shall be entitled, and may at its sole discretion, periodically monitor said financial account(s) via Online Bank Access and that the ability to access such information is a material term of consideration under the aforesaid Purchase and Sale and that the withholding or removal of such access shall constitute a material breach of the Agreement and, in the event of any such breach, Purchaser shall be entitled to any and all remedies provided for within the above referenced agreement together with additional liquidated damages for breach of this addendum equal to $2,500.00 or twenty percent (20%) of the outstanding balance, whichever is greater.
2. Merchant shall be permitted to change its bank login credentials provided Merchant shall provide such credentials to Purchaser simultaneously with such change and take whatever measures are necessary to ensure Purchaser's continued access to any and all of Merchant's financial accounts including, but not limited to, Merchant's bank, and deposit account(s). In the event Purchaser’s access to such information is restricted, for any reason whatsoever, Merchant shall take any and all measures necessary to restore such access to Purchaser within one (1) business day of such request. It is expressly agreed and understood that inability of Purchaser to access such information after request, for any reason whatsoever, shall constitute a material breach of the Agreement and, in the event of any such breach, Purchaser shall be entitled to any and all remedies provided for within the above referenced Purchase and Sale, together with additional liquidated damages for breach of this addendum equal to $2,500.00 or twenty percent (20%) of the outstanding balance, whichever is greater.
3. The Parties acknowledge and agree that while an outstanding balance with Purchaser exists, Merchant is prohibited from initiating a cash advance or loan product advance with another merchant cash advance company other than Purchaser. In the event that Merchant engages in such prohibited action in accordance with this Paragraph 3 of this Addendum, Merchant shall be in breach of the Purchase and Sale and in addition to any and all remedies pursuant to the Purchase and Sale, this Addendum, and all available remedies at law, and shall be subject to a $3,000.00, plus attorney’s fees, reasonable costs, and liquidated damages equal to the greater of $2,500.00 or twenty percent (20%) of the outstanding balance, whichever is greater.
4. By signing below, the Merchant hereby requests and acknowledges that the Specified Percentage shall be revised to up to N/A per business day (the “Payment”) which the parties agree is a good-faith approximation of the Specified Percentage, based on the Merchant’s Future Receipts due to Purchaser, pursuant the Agreement.
5. The Payment is to be drawn via ACH payment, from the following bank account:
| Bank Account: | 466017660349 |
| Routing Number: | 011000138 |
| Account Name: | Aurai LLC |
| Bank Name: | Bank of America |
6. The Parties acknowledge and agree that to the extent that any term of condition contained in the Agreement is contradictory or inconsistent with this Addendum, the Parties agree that the terms of this Addendum shall control.
7. The Parties acknowledge that, in executing this Addendum, each Party has had the opportunity to seek the advice of independent legal counsel and have read and understood all of the terms and provisions of this Addendum. This Addendum shall not be construed against any Party by reason of the drafting or preparation hereof.
8. This Addendum may be executed in counterparts, each of which shall be deemed an original provided both Parties have executed a counterpart of this Addendum, and all such counterparts shall together constitute one and the same instrument. Any signature delivered by a party by facsimile transmission or electronic mail will be deemed to be an original signature.
IN WITNESS WHEREOF, the parties have executed this Addendum to the Agreement as of the date first set forth above.
| MERCHANT | PURCHASER | |||
| Mahesh Prasad Choudhury | Nebula Asset Holdings LLC | |||
| Print Name: | Mahesh Choudhury | Print Name: | ||
| Title: | VP US Oerations | Title: | ||
| Signature: | /s/ Mahesh Choudhury | Signature: | ||
| Date: | 11/07/2025 | Date: | ||
DESCRIPTION OF COLLATERAL
This form is designed to collect detailed information about collateral assets provided in support of the security interest held by Nebula Financing. Please list each asset separately, including the full address and location, owner details, and any additional relevant information. The purpose of this form is to ensure all collateral is properly documented and assessed for its current market value and ownership status. Additional details such as lien status, insurance coverage, and unique identifiers should also be noted to ensure clarity and accuracy in the collateral assessment process.
By completing this form, you represent and warrant that the information provided is true, accurate, and complete to the best of your knowledge. You acknowledge that providing false or misleading information will result in a material breach of the Agreement.
| Asset Name/ Description | Category | Address & | Owner Name | Ownership | Asset Value | Additional |
| Location | (as stated in | Percentage | Information | |||
| title) | ||||||
NOTICE OF SALE, ASSIGNMENT AND TRANSFER
To Whom It May Concern:
This letter is to notify you that 11/7/2025, Mahesh Prasad Choudhury (“Merchant”) entered into that certain
Purchase and Sale of Future Receivables (the “Purchase and Sale Agreement”) with Nebula Asset Holdings LLC a New York limited liability company (“Purchaser”). Under the terms of the Purchase and Sale Agreement, Merchant sold, assigned, and transferred to Purchaser all Merchant’s right, title, and interest in and to Merchant’s receipts, accounts, and contract rights arising from or relating to the payment of monies payable from you to Merchant (collectively, the “Receivables”). As such, Purchaser is the absolute owner of the Receivables, and Merchant no longer has any right, title, or interest in or to the receivables.
Purchaser is the absolute owner of the Receivables regardless of any Uniform Commercial Code financing statement that may have been filed by Purchaser or any other entity with respect to the Receivables.
Purchaser may provide you with a copy of this signed letter as proof of Merchant’s sale, assignment, and transfer of the Receivables to Purchaser and of Purchaser’s absolute ownership of the Receivables. Upon your receipt of copy of this letter from Purchaser, you are hereby authorized and directed to deliver to Purchaser Receivables due from you to Merchant (absent the sale, assignment, and transfer made under the Agreement) in the amount indicated by Purchaser.
The undersigned represents that s/he is authorized to sign this letter on behalf of Merchant and to bind Merchant and all of its affiliates and subsidiaries.
| NEBULA ASSET HOLDINGS LLC | ||
| Print Name: | ||
| Title: | ||
| Signature: | ||
Irrevocable Letter of Direction
, 202__
VIA U.S. CERTIFIED MAIL
RETURN RECEIPT REQUESTED
EMAIL ( )
FAX ( )
Attention: Accounting & Legal Department
Re: Purchase and Sale of Receivables
Dear Valued Customer,
In order to accommodate the growth of our business, we have retained the services of Nebula Asset Holdings LLC, a New York limited liability company to fund and manage our accounts. This arrangement includes our irrevocable assignment Nebula Asset Holdings LLC of all of our rights to receive payment on our currently outstanding and all future accounts under all applicable laws, including, but not limited to, 9-406 of the Uniform Commercial Code. This change in procedure should allow us to serve you more efficiently. Consider this a notice to immediately change the remittance of all monies due to any of the following persons or entities:
Mahesh Prasad Choudhury (hereinafter, the “Merchant”)
[List any additional Merchant entities]
PAYMENTS ON ALL INVOICES, MONIES DUE, NOTES PAYABLE OR ANY TRANSFER OF MONIES SHALL HEREAFTER BE MADE PAYABLE AND ELECTRONICALLY TRANSFERRED OR MAILED DIRECTLY TO:
VIA WIRE
Nebula Asset Holdings LLC
[To include]
VIA CHECK
[To include]
Merchant agrees to indemnify and hold you harmless, as well as its officers and directors, employees and its affiliates and their respective successors and assigns and each other person, if any, who controls any thereof, against any loss, liability, claim, damage and expense whatsoever (including, but not limited to, any and all expenses whatsoever reasonably incurred in investigating, preparing or defending against any litigation commenced or threatened or any claim whatsoever) arising out of the above mentioned release of funds to Purchaser Capital, LLC.
Merchant that either (a) it has had advice of counsel of its own choosing in negotiations for and the preparation of this release, or (b) it has knowingly determined that such advice is not needed.
| Mahesh Prasad Choudhury | ||
| Print Name: | Mahesh Choudhury | |
| Title: | VP US Oerations | |
| Signature: | /s/ Mahesh Choudhury | |
| STATE OF | ) | ||
| )ss. | |||
| COUNTY OF | ) |
Sworn to (or affirmed) and subscribed before me by means of [ ] physical presence or [ ] online notarization, this , by , who is personally known to me or who has produced as identification.
| Notary Signature | |
| Print Notary Name |
List of Top 5 Clients
List of Top 5 Clients - Please list the top 5 clients that you are currently providing services for or have provided services for in the past 30 days.
| Business Name: | |
| Business Address: | |
| Email: | |
| Phone: | |
| Business Name: | |
| Business Address: | |
| Email: | |
| Phone: | |
| Business Name: | |
| Business Address: | |
| Email: | |
| Phone: | |
| Business Name: | |
| Business Address: | |
| Email: | |
| Phone: | |
| Business Name: | |
| Business Address: | |
| Email: | |
| Phone: |
DECLARATION OF ORDINARY COURSE OF BUSINESS
Each of the undersigned hereby declares the following:
1. I am duly authorized to sign the Purchase and Sale of Future Receivables (“Purchase and Sale”) dated as of this 7 day of November, 2025 by and between Aurai LLC, (the “Merchant”) and Nebula Asset Holdings LLC, a New York limited liability company (“Purchaser”), for and on behalf of the Merchant.
2. This Declaration of Ordinary Course of Business incorporates by reference the Purchase and Sale and any and all exhibits and addenda thereto (collectively, the “Agreement”).
| 3. | I acknowledge that I am authorized to sign the Agreement on behalf of Merchant. |
| 4. | I acknowledge that I had sufficient time to review the Agreement before signing it. |
| 5. | I acknowledge that I had an opportunity to seek legal advice from counsel of my choosing before signing the Agreement. |
| 6. | I acknowledge that Merchant is entering into the Agreement voluntarily and without any coercion. |
| 7. | I acknowledge that each Merchant is entering into the Agreement in the ordinary course of its business. |
8. I acknowledge that the payments to be made from any Merchant to Purchaser under the Agreement are being made in the ordinary course of Merchant’s business.
| 9. | I am aware of Merchant’s right to request a reconciliation of the payments made under the Agreement at any time. |
| 10. | I DECLARE UNDER PENALTY OF PERJURY THAT THE FOREGOING IS TRUE AND CORRECT. |
| MERCHANT | GUARANTOR |
| Mahesh Prasad Choudhury |
| Print Name: | Mahesh Choudhury | Print Name: | |
| Title: | VP US Oerations | Title: | |
| Signature: | /s/ Mahesh Choudhury | Signature: | |
| Date: | 11/07/2025 | Date: |
 |
Audit trail |
| Title | Aurai, LLC |
| File name | Aurai__LLC_-_Contract.docx |
| Document ID | 1ad6b24e24f14aed102fda8faa715c4384b8d8f2 |
| Audit trial date format | MM / DD / YYYY |
| Status |  Signed |
Document History
 |
11 / 07 / 2025 11:14:48 UTC-8 |
Sent for signature to Mahesh Prasad Choudhury ([email protected]) from [email protected] IP: 107.201.243.207 |
 |
11 / 07 / 2025 11:32:40 UTC-8 |
Viewed by Mahesh Prasad Choudhury ([email protected]) IP: 174.168.169.66 |
 |
11 / 07 / 2025 11:35:02 UTC-8 |
Signed by Mahesh Prasad Choudhury ([email protected]) IP: 174.168.169.66 |
 |
11 / 07 / 2025 11:35:02 UTC-8 |
The document has been completed. |
Exhibit 10.9
Sale of Future Receipts Agreement
This Sale of Future Receipts Agreement (“Agreement”) effective, 11/12/2025, is made by and between Ace Funding Source LLC (“Buyer”, “we”, or “us”), with its principal address at 295 Madison Avenue, 12th Floor, New York, NY 10017, each Seller identified below (“Seller” or “you”), and each person who signs this Agreement as a Guarantor (each a “Guarantor”).
Seller and Guarantor Information
| Seller Legal Name(s) | D/B/A | Entity type/where organized |
| COUNTY COMFORT SERVICES LLC | COUNTY COMFORT SERVICES |
Limited Liability Company/ MA |
| AND ALL ENTITIES SIGNING BELOW AS SELLER |
| Seller address | 2 Mount Royal Avenue STE 550, Marlborough, MA 01752 |
| Primary Contact Person For Sellers | Name/title:
MAHESH PRASAD, Owner Address: 4 JEFFERSON RD, Westborough, MA, 01581 Phone: 7703306879 Email: [email protected] |
| Guarantor(s) | MAHESH PRASAD |
Purchase Information
The transaction contemplated by this Agreement is a purchase of Future Receipts. “Future Receipts” means all payments received by Seller, or its right to receive such payments, in the ordinary course of Seller’s business, including but not limited to (a) payments made by cash, check, Automated Clearing House (“ACH”) or other electronic transfer; (b) payments, or rights to payments, made by credit card, debit card, bank card, charge card (each such card shall be referred to herein as a “Payment Card”); (c) accounts and payment intangibles; and (d) payments made by any other form. You will deliver the entire Purchased Amount of Future Receipts to us over time by allowing us to debit the Periodic Amount (which is subject to adjustment) on each Remittance Day. We will debit the Periodic Amount from one or more deposit accounts authorized by you for this purpose (each, an “Authorized Account”).
| Purchased Amount of | How we calculated the Periodic Amount
The Periodic Amount is the Specified Percentage of the average sales revenue we estimate you will receive. Our estimate is based on a review of your past revenue. We used information you provided to us to make this estimate. Beginning on the first Remittance Day, the Periodic Amount will be the amount identified on this page. You have the right to adjust the Periodic Amount to better reflect actual revenue as it changes over time. Please refer to Section 4 (Reconciliation Process) to learn how you can adjust the Periodic Amount. | |
| Future Receipts | ||
| $210,000.00 | ||
| Purchase Price | ||
| $150,000.00 | ||
| Periodic Amount | Remittance Days will occur (The option marked x applies):
¨ Every Week Day (i.e., Monday through Friday) x Weekly*
*We will notify you of the day or days on which each Remittance Day will occur. | |
| $7,000.00 | ||
| Specified Percentage | ||
7.47%
|
| Amounts Deducted from Purchase Price: | |
| Prior balance paid to Buyer | $0.00 |
| Prior balance paid to third parties | $0.00 |
| Origination fee | $7,500.00 |
| Total Amount Deducted From Purchase Price | $7,500.00 |
| Net Funded Amount | |
| This is the Purchase Price minus the Total Amount Deducted from Purchase Price. This is the total dollar amount of funds to be deposited into your Authorized Account. | $142,500.00 |
| The Net Funded Amount may change if the amounts needed to satisfy any prior balances changes between when we prepared this Agreement and funding. |
| 1 |  Initials , |
| 1. | Sale of Future Receipts. Seller hereby sells and assigns to Buyer, without recourse, the Purchased Amount of Future Receipts described above. As payment for the Purchased Amount, Buyer agrees to pay Seller the Purchase Price shown above and Seller will receive funds equal to the Net Funded Amount. |
| 2. | Buyer’s Acceptance of Agreement. The obligation of Buyer under this Agreement will not be effective unless and until Buyer has completed its review of the Seller and has accepted this Agreement by delivering the Net Funded Amount, shown above, into any Authorized Account. Prior to accepting this Agreement, Buyer may conduct a processing trial to confirm its access to any Authorized Account and the ability to withdraw the initial Periodic Amount. If the processing trial is not completed to the satisfaction of Buyer, Buyer will refund to Seller all funds that were obtained by Buyer during the processing trial. |
| 3. | Delivery of Purchased Amount. If Remittance Days are to occur on a frequency other than daily, then Buyer will notify Seller on or before the date Buyer has accepted this Agreement, of the day of the week or month (as applicable) on which Remittance Days will occur. The Purchased Amount will be delivered to Buyer each Remittance Day in a series of remittances each equal to the Periodic Amount. Seller authorizes Buyer to debit an Authorized Account on each Remittance Day, by initiating an ACH debit entry or by creating a remotely created check or electronically created item, in the amount of the initial Periodic Amount or, following any adjustment pursuant to Section 4 (Reconciliation Process), the adjusted Periodic Amount. For this purpose, Seller shall provide Buyer with all required account information and will provide an appropriate ACH authorization to Buyer. Seller agrees not to change any account information without prior written consent from Buyer. If a Remittance Day occurs on a bank holiday, Seller authorizes Buyer to initiate a debit entry on the next day on which Seller’s bank is open in an amount equal to the Periodic Amount and, if Remittance Days are scheduled to occur every Week Day, Buyer may initiate the debit entry in an amount equal to the Periodic Amount scheduled for the next day, plus the Periodic Amount that would have been debited on the preceding bank holiday. If any ACH entry, check, or electronically created item is returned or rejected for insufficient funds, then Seller will pay Buyer a returned entry fee of $30. In addition, Seller will reimburse Buyer for any charges incurred by Buyer resulting from the returned ACH entry, check, or electronically created item. Buyer is not responsible for any overdrafts or rejected transactions that may result from Buyer’s debiting any amount authorized under the terms of this Agreement. |
| 4. | Reconciliation Process (IMPORTANT PROTECTION FOR SELLER). The Periodic Amount is based on an estimate of the Specified Percentage of Seller’s Future Receipts. At any time, Seller or Buyer have the right to require a new review of Seller’s revenue for the purpose of evaluating whether the Periodic Amount continues to accurately reflect the Specified Percentage of Seller’s actual revenue for the period reviewed (a “reconciliation”). |
| a. | How Seller may Request a Reconciliation. Seller may request a reconciliation in writing via regular mail or email to [email protected]. |
| b. | How Buyer may Request a Reconciliation. Buyer may request a reconciliation in writing via regular mail or e-mail. |
| c. | Reconciliation Review. After receiving or making a request for reconciliation pursuant to this Agreement, Buyer shall calculate Seller’s average revenue for the 30-day period preceding the reconciliation request (the “Review Period”). Seller shall cooperate with any reconciliation by providing bank statements or other records of Seller’s actual revenue received during the Review Period (“Reconciliation Information”). Reconciliation Information may be provided electronically. Seller shall also provide Buyer with any assistance or other information needed to access or view any Reconciliation Information. Upon receipt of the Reconciliation Information, Buyer shall promptly (but no later than 3 calendar days following such receipt) calculate whether the total of all Periodic Amounts remitted to Buyer during the Review Period was greater than the Specified Percentage of Seller’s actual revenue during the Review Period (an “excess”) or less than the Specified Percentage of Seller’s actual revenue during the Review Period (a “shortfall”). |
| d. | Adjusting the Periodic Amount. If there was an excess, then Buyer shall decrease the Periodic Amount for each subsequent Remittance Day. If there was a shortfall, then Buyer may (but is not required to) increase the Periodic Amount for each subsequent Remittance Day. In either case, Buyer shall adjust the Periodic Amount to an amount equal to the Specified Percentage of Seller’s reasonably anticipated average revenue, based on the Reconciliation Information. After an adjustment, the Periodic Amount shall remain unchanged until a subsequent adjustment occurs in accordance with this Section. |
| e. | Failure to Provide Reconciliation Information. If Seller requests a reconciliation and fails to provide the Reconciliation Information within 10 calendar days after Seller’s reconciliation request, Buyer may consider Seller’s reconciliation request withdrawn. If Buyer requests a reconciliation and Seller fails to provide the Reconciliation Information within 10 calendar days after Buyer’s reconciliation request, Buyer may adjust the Periodic Amount based on the best information reasonably available to Buyer. |
| f. | Additional Reconciliation. In addition to adjusting the Periodic Amount as described above, either party may, in connection with any reconciliation, request an additional reconciliation. Upon such a request, Buyer will review the Reconciliation Information and calculate the excess or shortfall for the prior month, if any, as described above. Within 5 business days after making that calculation, Buyer shall credit the amount of any excess, or debit the amount of any shortfall, by initiating the appropriate credit or debit entry to the Authorized Account. |
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| 5. | Changing the Remittance Day. The parties may change the frequency of the Remittance Day pursuant to this Section. The effective date of any change to the Remittance Day is referred to herein as the “Change Effective Date”. Any change to the Remittance Day will be accompanied by a change to the Periodic Amount immediately following the Change Effective Date. The process for requesting changes to the Remittance Day and calculation of the Periodic Amount is described below. |
| a. | Changing Remittance Day to occur each Week Day. Either Buyer or Seller may request that a weekly Remittance Day be changed to occur on each Week Day. The party requesting a change must notify the other party in accordance with Section 19 (Notices). The Change Effective Date shall take effect promptly, but no later than one week from the date such notice is either sent or received by Buyer. Immediately after the Change Effective Date, the new Periodic Amount shall be adjusted to an amount equal to the Periodic Amount immediately prior to the Change Effective Date, divided by five. |
| b. | Changing Remittance Day to occur weekly. When the Remittance Day is scheduled to occur each Week Day, the Remittance Day may be changed to occur weekly, but only if both parties agree to such change in writing (which may be memorialized in an electronic record, including email). To be effective, both parties must agree on the day each Remittance Day will occur. Immediately after the Change Effective Date, the new Periodic Amount shall be adjusted to an amount equal to the Periodic Amount immediately prior to the Change Effective Date, multiplied by five. |
| c. | Effect on reconciliation. Following any Change Effective Date, subsequent adjustments to the Periodic Amount pursuant to Section 4 (Reconciliation Process) shall account for the change in the frequency of the Remittance Day as described above. |
| 6. | Nonrecourse Sale of Future Receipts (THIS IS NOT A LOAN). Seller is selling a portion of a future revenue stream to Buyer at a discount, not borrowing money from Buyer. There is no interest rate or payment schedule and no time period during which the Purchased Amount must be collected by Buyer. Seller acknowledges that it has no right to repurchase the Purchased Amount from Buyer. Buyer assumes the risk that Future Receipts may be remitted more slowly than Buyer may have anticipated or projected because Seller’s business has slowed down, and the risk that the full Purchased Amount may never be remitted because Seller’s business goes bankrupt or Seller otherwise ceased operations in the ordinary course of business. Buyer is buying the Purchased Amount knowing the risks that Seller’s business may slow down or fail, and Buyer assumes these risks based on Seller’s representations, warranties and covenants in this Agreement that are designed to give Buyer a reasonable and fair opportunity to receive the benefit of its bargain. By this Agreement, Seller transfers to Buyer full and complete ownership of the Purchased Amount and Seller retains no legal or equitable interest therein. |
| 7. | Fees and Charges. The fees and charges owed by Seller are as described in this Agreement. Some or all of the Origination Fee may be paid to a broker. Otherwise, Buyer is NOT CHARGING ANY BROKER FEES to Seller. If Seller is charged another such fee, Seller acknowledges that it is not being charged by Buyer. |
| 8. | Early Delivery Option. If this Agreement contains an Early Delivery Schedule, then Seller may at its option elect to pay the remaining balance of the Purchased Amount to Buyer on an accelerated basis in a discounted amount described in the Early Delivery Schedule attached to this Agreement (the “Early Delivery Option”). The Early Delivery Option is subject to any conditions identified in the Early Delivery Schedule. |
| 9. | Credit Report and Financial Information Authorizations. |
| a. | Seller and each of the Guarantors signing above authorize Buyer, its agents and representatives and any credit reporting agency engaged by Buyer, to (i) investigate any references given or any other statements or data obtained from or about Seller or any of the Guarantors for the purpose of this Agreement, (ii) obtain consumer and business credit reports on the Seller and any of its owners, and (iii) to contact personal and business references provided by Seller to Buyer, at any time now or for so long as Seller and/or Guarantors continue to have any obligations to Buyer as a consequence of this Agreement or for Buyer’s ability to determine Seller’s eligibility to enter into any future agreement with Buyer. |
| b. | Seller authorizes Buyer and its agents to investigate its financial responsibility and history, and will provide to Buyer any authorizations, banking or financial statements, tax returns, etc., as Buyer deems necessary and reasonable prior to or at any time after execution of this Agreement. A photocopy of this authorization will be deemed acceptable as an authorization for release of financial and credit information. Buyer is authorized to update such information and financial and credit profiles from time to time as it deems appropriate. |
| c. | Seller waives, to the maximum extent permitted by law, any claim for damages against Buyer or any of its affiliates relating to any investigation undertaken by or on behalf of Buyer as permitted by this Agreement or disclosure of information as permitted by this Agreement. |
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| 10. | Authorization to Contact Current and Prior Banks. Seller authorizes all of its banks and brokers and its Payment Card processor(s) to provide Buyer with Seller’s banking, brokerage and/or processing history to determine qualification or continuation in this program, or for collections upon a breach of this Agreement. Seller hereby further authorizes Buyer to contact any current or prior bank of the Seller in order to obtain whatever information it may require regarding Seller’s transactions with any such bank. Such information may include but is not limited to, information necessary to verify the amount of Future Receipts previously processed on behalf of Seller and any fees that may have been charged by the bank. In addition, Seller authorizes Buyer to contact any current or prior bank of the Seller for collection purposes and in order to confirm that Seller is exclusively using an Authorized Account for the deposit of all Future Receipts of the Seller. |
| 11. | Right to Cancel. Seller understands that Buyer offers Seller a right to cancel this Agreement at any time within 3 calendar days after Buyer has delivered the Net Funded Amount to Seller. Seller may exercise this right by notifying Buyer that it is cancelling this Agreement and paying to Buyer the following amount in immediately available U.S. funds: (a) the Net Funded Amount, and (b) any portion of the Purchase Price that was advanced to third parties. Seller’s right to cancel shall be effective only if Buyer receives both the notice and the required payment no later than 5:00 PM Eastern Time on the third calendar day following the date on which Seller received the Net Funded Amount. |
| 12. | Application of Amounts Received by Buyer. Buyer reserves the right to apply amounts received by it under this Agreement to any fees or other charges due to Buyer from Seller prior to applying such amounts to reduce the amount of any outstanding Purchased Amount. |
| 13. | Representations, Warranties and Covenants of Seller. As of the date of this Agreement and, unless expressly stated otherwise, continuing until Buyer has received the Purchased Amount and all fees and charges due under this Agreement, Seller represents, warrants and covenants to Buyer as follows: |
| a. | No Interference. Seller must deposit all Future Receipts into an Authorized Account on a daily basis and must instruct Seller’s credit card processor, which must be approved by Buyer (the “Processor”) to deposit all Payment Card receipts of Seller into an Authorized Account on a daily basis. Seller agrees not to (i) change any Authorized Account without the express written consent of Buyer, (ii) create any new depository account, (iii) revoke Buyer’s authorization to debit an Authorized Account, (iv) close an Authorized Account without the express written consent of Buyer or, (v) take any other action that denies, or interferes with, Buyer’s rights under this Agreement, including but not limited to Buyer’s right to receive its share of revenue received by Seller. |
| b. | Stacking Prohibited. Seller shall not, without Buyer’s prior written consent, enter into: (a) any other agreement for the sale of Future Receipts, or (b) any loan agreement that encumbers Seller’s Future Receipts or requires daily payments. Buyer may share information regarding this Agreement with any third party in order to determine whether Seller is in compliance with this provision. |
| c. | Financial Condition and Financial Information. Any bank statements and financial statements of Seller that have been furnished to Buyer, and future statements that will be furnished to Buyer, fairly and accurately represent the financial condition of Seller at such dates. Furthermore, Seller represents that all documents, forms and recorded interviews provided to or with Buyer are true, accurate and complete in all respects, and accurately reflect Seller’s financial condition and results of operations at the time they are provided. Seller further agrees to authorize the release of any past or future tax returns to Buyer. |
| d. | Compliance with Law and Governmental Approvals. Seller is in compliance and shall comply with all applicable federal, state and local laws, rules and regulations and has valid permits, authorizations and licenses to own, operate and lease its properties and to conduct the businesses in which it is presently engaged and/or will engage in hereafter. |
| e. | Authority to Enter Into This Agreement. Seller and the person(s) signing this Agreement on behalf of Seller, have full power and authority to incur and perform the obligations under this Agreement, all of which have been duly authorized. |
| f. | Change of Name or Location or Sale or Closing of Business. Seller will not conduct Seller’s businesses under any name other than as disclosed to Buyer or change any of its places of business without prior written consent of Buyer. Seller will not voluntarily sell, dispose, transfer or otherwise convey all or substantially all of its business or assets without (i) the express prior written consent of Buyer, and (ii) the written agreement of any purchaser or transferee assuming all of Seller’s obligations under this Agreement pursuant to documentation satisfactory to Buyer. As of the date of this Agreement, Seller does not plan to close its business either temporarily, whether for renovations, repairs or any other purpose, or permanently. Seller will not voluntarily close its business on a temporary basis for renovations, repairs, or any other voluntary purposes. This provision, however, does not prohibit Seller from closing its business temporarily if such closing is required to conduct renovations or repairs that are required by local ordinance or other legal order, such as from a health or fire inspector, or if otherwise forced to do so by circumstances outside of the control of Seller. Prior to any such closure, Seller will provide Buyer 10 calendar days’ notice to the extent practicable. |
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| g. | No Pending or Contemplated Bankruptcy as of the Date of this Agreement. As of the date of this Agreement: (a) Seller has not filed, and does not plan to file, any petition for bankruptcy protection under Title 11 of the United States Code, (b) there has been no involuntary petition brought or pending against Seller, and (c) Seller has not received any communication from any third party indicating that an involuntary petition will be filed against Seller. Seller has not consulted with a bankruptcy attorney or a debt relief organization within six months prior to the date of this Agreement. Seller further warrants that, as of the date of this Agreement, it does not plan to engage the services of a debt relief organization. |
| h. | Seller to Pay Taxes Promptly. Seller will promptly pay all necessary taxes and other assessments, including but not limited to employment, sales and use taxes. |
| i. | No Violation of Prior Agreements. Seller’s execution and performance of this Agreement does not conflict with and will not violate any other agreement, obligation, promise, court order, administrative order or decree, law or regulation to which Seller is subject, including any agreement that prohibits the sale or pledge of Seller’s Future Receipts. |
| j. | Seller’s Knowledge and Representation. Seller represents, warrants, and agrees that it is a sophisticated business entity familiar with the kind of transaction covered by the Agreement; it was represented by counsel or had full opportunity to consult with counsel. |
| k. | Accurate and Complete Information. Seller represents, warrants, and agrees that all information provided to Buyer and all statements made to Buyer relating to this transaction in any way have been truthful, accurate, and complete. Seller further agrees that Seller will be truthful in all future statements to Buyer, and will provide Buyer with accurate and complete information regarding Seller’s business as required by this Agreement. |
| l. | Seller as a Commercial Entity. Seller is a sophisticated business entity familiar with the type of transaction described under this Agreement, and has had a full opportunity to consult with counsel of their choice, and has consulted with counsel or has decided not to avail themselves of that opportunity. |
| 14. | Rights of Buyer. |
| a. | Acknowledgment of Security Interest and Security Agreement. The sale of Future Receipts pursuant to this Agreement shall constitute and shall be construed and treated for all purposes as a true and complete sale from Seller to Buyer, conveying good title to the Future Receipts free and clear of any liens and encumbrances. To the extent the Future Receipts include any “accounts” or “payment intangibles” as those terms are defined in the Uniform Commercial Code as in effect in the state in which the Seller is located (“UCC”) then: (i) the sale of such accounts or payment intangibles creates a security interest as defined in the UCC, (ii) this Agreement constitutes a security agreement under the UCC, and (iii) Buyer has all the rights of a secured party under the UCC with respect to such accounts or payment intangibles. Seller further agrees that, with or without a breach of this Agreement, Buyer may notify account debtors, or other persons obligated on the Future Receipts, or holding the Future Receipts, of Seller’s sale of the Future Receipts and may instruct them to make payment or otherwise render performance to or for the benefit of Buyer. |
| b. | Financing Statements. Seller authorizes Buyer to file one or more UCC-1 forms consistent with the UCC to give notice that the Purchased Amount is the sole property of Buyer. The UCC filing may state that such sale is intended to be a sale and not an assignment for security and may state that the Seller is prohibited from obtaining any financing that impairs the value of the Future Receipts or Buyer’s right to collect same. Seller authorizes Buyer to debit any Authorized Account for all costs incurred by Buyer associated with the filing, amendment or termination of any UCC filings. |
| c. | Right of Access. In order to ensure that Seller is complying with the terms of this Agreement, Buyer shall have the right to (i) enter during regular business hours, without notice, the premises of Seller’s business for the purpose of inspecting and checking Seller’s transaction processing terminals to ensure the terminals are properly programmed to submit and or batch Seller’s daily receipts to the Processor and to ensure that Seller has not violated any other provision of this Agreement, (ii) Seller shall provide access to its employees and records and all other items as requested by Buyer; and (iii) have Seller provide information about its business operations, banking relationships, vendors, landlord and other information to allow Buyer to interview any relevant parties. |
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| d. | Phone Recordings and Contact. Seller agrees that any call between Buyer and Seller, and their agents and employees may be recorded or monitored. Further, Seller agrees that (i) it has an established business relationship with Buyer, its employees and agents and that Seller may be contacted from time-to-time regarding this or other business transactions, (ii) that such communications and contacts are not unsolicited or inconvenient, and (iii) that any such contact may be made at any phone number, email address, or facsimile number given to Buyer by the Seller, its agents or employees, including cellular telephones. |
| e. | ACH Authorization. Seller represents and warrants that, with respect to any authorization provided by Seller to permit Buyer to initiate ACH debit or credit entries to an Authorized Account (“ACH Authorization”): (i) each Authorized Account is solely owned by Seller; (ii) any person executing an ACH Authorization on behalf of Seller is an authorized signer on the Authorized Account and has the power and authority to authorize Buyer to initiate ACH transactions to and from the Authorized Account, and (iii) the Authorized Account is a legitimate, open, and active bank account used solely for business purposes and not for personal, family or household purposes. If an ACH entry is rejected by Seller’s bank for any reason other than a stop payment order placed by Seller with its bank, including without limitation insufficient funds, Seller agrees that Buyer may resubmit up to two times any ACH entry that is dishonored. Seller’s bank may charge Seller fees for unsuccessful ACH entries. Seller agrees that Buyer will have no liability to Seller for such fees. In the event Buyer makes an error in processing any ACH entry, Seller authorizes Buyer to initiate ACH entries to the applicable Authorized Account to correct the error. Seller acknowledges that the origination of ACH entries to and from an Authorized Account must comply with applicable law and applicable network rules. Seller agrees to be bound by the Rules and Operating Guidelines of Nacha (formerly known as the National Automated Clearing House Association). Seller will not dispute any ACH entry initiated pursuant to an ACH Authorization, provided the entry corresponds to the terms of the ACH Authorization. Seller requests the bank that holds the Authorized Account honor all ACH entries initiated in accordance with an ACH Authorization. |
| 15. | Remedies for Seller’s Breach of this Agreement. If Seller violates or fails to comply with any term or covenant in this Agreement, Buyer may proceed to protect and enforce its rights including, but not limited to, the following: |
| a. | Buyer may increase the Specified Percentage to 100% and may adjust the Periodic Amount to reflect the new Specified Percentage. |
| b. | Buyer shall have the right to collect the full undelivered Purchased Amount plus all fees and charges (including collection and legal fees as more fully described in this Agreement) assessed under this Agreement, which will become due and payable in full immediately. |
| c. | Buyer may enforce the provisions of the Guaranty of Performance against each Guarantor. |
| d. | Buyer may require Seller to pay Buyer all reasonable costs associated with Seller’s breach. If demanded by Buyer, Seller shall pay Buyer a collection charge in an amount equal to 25% of the undelivered balance of the Purchased Amount (the “Default Charge”) which shall be applied to Buyer’s actual costs to enforce its rights under this Agreement. In the event the Default Charge exceeds Buyer’s actual costs of enforcement, Seller shall be entitled to a refund of any excess. Buyer may proceed to protect and enforce its rights and remedies by arbitration or lawsuit. In any such arbitration or lawsuit, under which Buyer shall recover judgment against Seller, Seller shall be liable for all of Buyer’s costs, including but not limited to all reasonable attorneys’ fees and court costs. However, the rights of Buyer under this provision shall be limited as provided in the arbitration provision set forth below. |
| e. | Buyer may debit depository accounts wherever situated by means of ACH debit or facsimile signature on a computer-generated check drawn on any of Seller’s banking accounts for all sums due to Buyer. |
| f. | Subject to the arbitration provisions of this Agreement, all rights, powers and remedies of Buyer in connection with this Agreement may be exercised at any time by Buyer after the occurrence of breach, are cumulative and not exclusive, and shall be in addition to any other rights, powers or remedies provided by law or equity. |
| 16. | Modifications, Amendments. No modification, amendment, waiver or consent of any provision of this Agreement shall be effective unless the same is in writing and signed by Buyer. |
| 17. | Assignment. Buyer may assign, transfer or sell its rights to receive the Purchased Amount or delegate its duties hereunder, either in whole or in part, with or without prior written notice to Seller. |
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| 18. | Multiple Sellers. If more than one person or entity is listed as a Seller above, then the term “Seller” refers collectively to all Sellers who have signed the signature page of this Agreement. The term “Future Receipts” refers to the Future Receipts of each Seller and the calculation of the initial Periodic Amount and any adjustment to the Periodic Amount shall be based on an aggregate of the actual or projected sales revenue of all the Sellers. Each Seller agrees that Buyer’s purchase of Future Receipts hereunder constitutes a purchase of the Future Receipts of all the Sellers. Each Seller agrees that it is jointly and severally liable to Buyer for the obligation to deliver the Purchased Amount from its own Future Receipts. Each Seller agrees that the release of any other Seller from any obligations under this Agreement, whether in whole or in part, will not limit, reduce, release, or impair such Seller’s obligations to Buyer, including the obligation to deliver the undelivered balance of the Purchased Amount. Each Seller designates the Primary Contact Person identified above as its authorized representative for all purposes related to this Agreement and any related transactions. Buyer may treat any notice or instruction received from the Primary Contact Person as a notice or instruction from all Sellers. |
| 19. | Notices. |
| a. | Notices from Buyer. Buyer may send any notices, disclosures, terms and conditions, other documents, and any future changes to Seller and Guarantor (as applicable) by regular mail or (at Buyer’s option) by e-mail to the Primary Contact Person. Seller and each Guarantor agrees that the Primary Contact Person is authorized to receive all communications on behalf of Seller and each Guarantor. Notices sent by e-mail are effective when sent. Notices sent by regular mail become effective three days after mailing to the Primary Contact Person at the address set forth above or such new address communicated by the Primary Contact Person to Buyer pursuant to this Section. |
| b. | Notices from Seller and Guarantor. Unless another method of notice to Buyer is specifically described in this Agreement, Seller and Guarantor may send any notices to Buyer by e-mail only upon the prior written consent of Buyer, which consent may be withheld or revoked at any time in Buyer’s sole discretion. Otherwise, any notices or other communications from Seller and Guarantor to Buyer must be delivered by certified mail, return receipt requested, to Buyer at 366 N. Broadway, Jerico, NY 11753. Notices sent to Buyer shall become effective only upon receipt by Buyer. |
| 20. | Binding Effect, Governing Law, Venue and Jurisdiction. This Agreement shall be binding upon and inure to the benefit of Seller, Buyer, Guarantor and their respective successors and assigns, except that neither Seller nor Guarantor shall have the right to assign its respective rights hereunder or any interest herein without the prior written consent of Buyer which consent may be withheld in Buyer’s sole discretion. Except as set forth in the Arbitration section, this Agreement shall be governed by and construed in accordance with the laws of the state of New York, without regard to any applicable principles of conflicts of law. Each Seller and Guarantor understands and agrees that (i) Buyer is located in New York, (ii) Buyer makes all decisions from Buyer’s office in New York, (iii) the Agreement is made in New York (that is, no binding contract will be formed until Buyer receives and accepts Seller’s signed Agreement in New York, and (iv) Seller’s payments are not accepted until received by Buyer in New York. Any suit, action or proceeding arising hereunder, or the interpretation, performance or breach of this Agreement, shall, if Buyer so elects, be instituted in any court sitting in New York, (the “Acceptable Forums”). Each Seller and Guarantor agrees that the Acceptable Forums are convenient to it, and submit to the jurisdiction of the Acceptable Forums and waives any and all objections to jurisdiction or venue. Should such proceeding be initiated in any other forum, each Seller and Guarantor waives any right to oppose any motion or application made by Buyer to transfer such proceeding to an Acceptable Forum. Unless prohibited by law, Buyer, Seller and Guarantor further agree that the mailing by certified or registered mail, return receipt requested, of any process required by any such court will constitute valid and lawful service of process against them, without the necessity for service by any other means provided by statute or rule of court, but without invalidating service performed in accordance with such other provisions. |
| 21. | Survival of Representations, Warranties and Covenants. All representations, warranties and covenants herein of the parties shall survive the execution and delivery of this Agreement and shall continue in full force until all obligations under this Agreement shall have been satisfied in full. |
| 22. | Interpretation. All parties hereto have had the opportunity to review this Agreement with an attorney of their own choosing and have relied only on their own attorney’s guidance and advice or have been provided sufficient opportunity to have an attorney of their choosing review the Agreement. No construction determinations shall be made against Buyer as drafter. |
| 23. | Entire Agreement and Severability. This Agreement embodies the entire agreement among Seller, Guarantor, and Buyer and supersedes all prior agreements and understandings relating to the subject matter hereof. In case any of the provisions in this Agreement is found to be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of any other provision contained herein shall not in any way be affected or impaired. |
| 24. | Execution. Facsimile signatures, or any other electronic means reflecting the party’s signature hereto, shall be deemed acceptable for all purposes. The parties agree that if a duly authorized representative of each of the parties signs this Agreement and transmits such Agreement to the other party via facsimile or electronically transmitted portable document format, such transmission shall be treated in all manner and respects as an original signature (or counterpart thereof) and shall be considered to have the same binding legal effects as if it were the original signed version thereof delivered in person. At the request of a party hereto, each other party hereto shall re-execute original forms thereof and deliver them to all other parties. No party hereto shall raise the use of a facsimile machine or electronic transmission in portable document format to deliver a signature or the fact that any signature was transmitted or communicated through the use of facsimile machine or electronic transmission in portable document format as a defense to this Agreement and each such party forever waives any such defense. This Agreement may be signed in one or more counterparts, each of which shall constitute an original and all of which when taken together shall constitute one and the same agreement. |
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| 25. | Authorization to Contact. |
| a. | Authorization to Contact by Phone. Seller and Guarantor authorize Buyer, its affiliates, agents and independent contractors to contact Seller or Guarantor at any telephone number Seller or Guarantor provide to Buyer or from which Seller or Guarantor places a call to Buyer, or any telephone number where Buyer believes it may reach Seller or Guarantor, using any means of communication, including but not limited to calls or text messages to mobile, cellular, wireless or similar devices or calls or text messages using an automated telephone dialing system and/or artificial voices or prerecorded messages, even if Seller or Guarantor incurs charges for receiving such communications. |
| b. | Authorization to Contact by Other Means. Seller and Guarantor also agree that Buyer, its affiliates, agents and independent contractors, may use any other medium not prohibited by law including, but not limited to, mail, e-mail and facsimile, to contact Seller and Guarantor. Seller and Guarantor expressly consent to conduct business by electronic means. |
| 26. | Service of Process. Each Merchant and each Guarantor consent to service of process and legal notices made by First Class or Priority Mail delivered by the United States Postal Service and addressed to the address(es) set forth on the first page of this Agreement or any other address(es) provided in writing to the Purchaser by any Merchant or Guarantor, and unless applicable law or rules provide otherwise, any such service will be deemed complete upon dispatch. Each Merchant and each Guarantor agrees that it will be precluded from asserting that it did not receive service of process or any other notice mailed to the address(es) set forth on the first page of this Agreement if it does not furnish a certified mail receipt signed by the Purchaser that the Purchaser was provided with notice of a change in the contact address(es). |
| 27. | JURY WAIVER. THE PARTIES WAIVE THE RIGHT TO A TRIAL BY JURY IN ANY COURT IN ANY SUIT, ACTION OR PROCEEDING ON ANY MATTER ARISING IN CONNECTION WITH OR IN ANY WAY RELATED TO THE TRANSACTIONS OF WHICH THIS AGREEMENT IS A PART OR ITS ENFORCEMENT, EXCEPT WHERE SUCH WAIVER IS PROHIBITED BY LAW OR DEEMED BY A COURT OF LAW TO BE AGAINST PUBLIC POLICY. THE PARTIES ACKNOWLEDGE THAT EACH PARTY MAKES THIS WAIVER KNOWINGLY, WILLINGLY AND VOLUNTARILY AND WITHOUT DURESS, AND ACKNOWLEDGE THEIR RIGHT TO REVIEW THE RAMIFICATIONS OF THIS WAIVER WITH THEIR ATTORNEYS. |
| 28. | CLASS ACTION WAIVER. BUYER, SELLER, AND EACH GUARANTOR ACKNOWLEDGE AND AGREE THAT THE AMOUNT AT ISSUE IN THIS TRANSACTION AND ANY DISPUTES THAT ARISE BETWEEN THEM ARE LARGE ENOUGH TO JUSTIFY DISPUTE RESOLUTION ON AN INDIVIDUAL BASIS. EACH PARTY HERETO WAIVES ANY RIGHT TO ASSERT ANY CLAIMS AGAINST THE OTHER PARTIES AS A REPRESENTATIVE OR MEMBER IN ANY CLASS OR REPRESENTATIVE ACTION, EXCEPT WHERE SUCH WAIVER IS PROHIBITED BY LAW OR DEEMED BY A COURT OF LAW TO BE AGAINST PUBLIC POLICY. TO THE EXTENT ANY PARTY IS PERMITTED BY LAW OR A COURT OF LAW TO PROCEED WITH A CLASS OR REPRESENTATIVE ACTION AGAINST THE OTHER, THE PARTIES AGREE THAT: (I) THE PREVAILING PARTY SHALL NOT BE ENTITLED TO RECOVER ATTORNEYS’ FEES OR COSTS ASSOCIATED WITH PURSUING THE CLASS OR REPRESENTATIVE ACTION (NOT WITHSTANDING ANY OTHER PROVISION IN THIS AGREEMENT), AND (II) THE PARTY WHO INITIATES OR PARTICIPATES AS A MEMBER OF THE CLASS WILL NOT SUBMIT A CLAIM OR OTHERWISE PARTICIPATE IN ANY RECOVERY SECURED THROUGH THE CLASS OR REPRESENTATIVE ACTION. |
| 29. | ARBITRATION. IF BUYER, SELLER OR ANY GUARANTOR REQUESTS, THE OTHER PARTIES AGREE TO ARBITRATE ALL DISPUTES AND CLAIMS ARISING OUT OF OR RELATING TO THIS AGREEMENT. IF BUYER, SELLER OR ANY GUARANTOR SEEKS TO HAVE A DISPUTE SETTLED BY ARBITRATION, THAT PARTY MUST FIRST SEND TO ALL OTHER PARTIES, BY CERTIFIED MAIL, A WRITTEN NOTICE OF INTENT TO ARBITRATE. IF BUYER, SELLER OR ANY GUARANTOR DO NOT REACH AN AGREEMENT TO RESOLVE THE CLAIM WITHIN 30 DAYS AFTER THE NOTICE IS RECEIVED, BUYER, SELLER OR ANY GUARANTOR MAY COMMENCE AN ARBITRATION PROCEEDING WITH THE AMERICAN ARBITRATION ASSOCIATION (“AAA”) OR THE FORUM. BUYER WILL PROMPTLY REIMBURSE SELLER OR GUARANTOR FOR ANY ARBITRATION FILING FEE, HOWEVER, IN THE EVENT THAT BOTH SELLER AND GUARANTOR MUST PAY FILING FEES, BUYER WILL ONLY REIMBURSE SELLER’S ARBITRATION FILING FEE AND, EXCEPT AS PROVIDED IN THE NEXT SENTENCE, BUYER WILL PAY ALL ADMINISTRATION AND ARBITRATOR FEES. IF THE ARBITRATOR FINDS THAT EITHER THE SUBSTANCE OF THE CLAIM RAISED BY SELLER OR GUARANTOR OR THE RELIEF SOUGHT BY SELLER OR GUARANTOR IS IMPROPER OR NOT WARRANTED, AS MEASURED BY THE STANDARDS SET FORTH IN FEDERAL RULE OF PROCEDURE 11(B), THEN BUYER WILL PAY THESE FEES ONLY IF REQUIRED BY THE AAA OR FORUM RULES. SELLER AND GUARANTOR AGREE THAT, BY ENTERING INTO THIS AGREEMENT, THEY ARE WAIVING THE RIGHT TO TRIAL BY JURY. BUYER, SELLER OR ANY GUARANTOR MAY BRING CLAIMS AGAINST ANY OTHER PARTY ONLY IN THEIR INDIVIDUAL CAPACITY, AND NOT AS A PLAINTIFF OR CLASS MEMBER IN ANY PURPORTED CLASS OR REPRESENTATIVE PROCEEDING. FURTHER, BUYER, SELLER AND ANY GUARANTOR AGREE THAT THE ARBITRATOR MAY NOT CONSOLIDATE PROCEEDINGS FOR MORE THAN ONE PERSON’S CLAIMS, AND MAY NOT OTHERWISE PRESIDE OVER ANY FORM OF A REPRESENTATIVE OR CLASS PROCEEDING, AND THAT IF THIS SPECIFIC PROVISION DEALING WITH THE PROHIBITION ON CONSOLIDATED, CLASS OR AGGREGATED CLAIMS IS FOUND UNENFORCEABLE, THEN THE ENTIRETY OF THIS ARBITRATION CLAUSE SHALL BE NULL AND VOID. THIS AGREEMENT TO ARBITRATE IS GOVERNED BY THE FEDERAL ARBITRATION ACT AND NOT BY ANY STATE LAW REGULATING THE ARBITRATION OF DISPUTES. THIS AGREEMENT IS FINAL AND BINDING EXCEPT TO THE EXTENT THAT AN APPEAL MAY BE MADE UNDER THE FAA. ANY ARBITRATION DECISION RENDERED PURSUANT TO THIS ARBITRATION AGREEMENT MAY BE ENFORCED IN ANY COURT WITH JURISDICTION. THE TERMS “DISPUTES” AND “CLAIMS” SHALL HAVE THE BROADEST POSSIBLE MEANING. |
| 8 | Initials , |
| 30. | RIGHT TO OPT OUT OF ARBITRATION. SELLER AND GUARANTOR(S) MAY OPT OUT OF THE ARBITRATION PROVISION ABOVE. TO OPT OUT OF THE ARBITRATION CLAUSE, SELLER AND EACH GUARANTOR MUST SEND BUYER A NOTICE THAT THE SELLER AND EACH GUARANTOR DOES NOT WANT THE CLAUSE TO APPLY TO THIS AGREEMENT. FOR ANY OPT OUT TO BE EFFECTIVE, SELLER AND EACH GUARANTOR MUST SEND AN OPT OUT NOTICE TO THE FOLLOWING ADDRESS BY REGISTERED MAIL, WITHIN 14 DAYS AFTER THE DATE OF THIS AGREEMENT: ACE FUNDING SOURCE LLC, 366 N. BROADWAY, JERICO, NY 11753 ATTENTION: ARBITRATION OPT-OUT. |
Agreement of Seller: By signing below Seller agrees to the terms and conditions contained in this Agreement, and further agrees that this transaction is for business purposes.
| Seller: COUNTY COMFORT SERVICES LLC | ||
| Name: MAHESH PRASAD | ||
| Title: Owner | ||
| Address: 2 Mount Royal Avenue STE 550, Marlborough, MA 01752 | ||
| TAX ID: 33-3008203 | ||
| /s/ Mahesh Choudhury | |||
| By: | Mahesh Choudhury (Nov 12, 2025 15:36:35 EST) | (signature) | |
| Seller: SOLAR ENERGY SYSTEMS OF BREVARD, INC. | |||
| Name: MAHESH PRASAD | |||
| Title: Owner | |||
| Address: 1536 CYPRESS AVE, Melbourne FL 32935 | |||
| TAX ID: - 203484826 | |||
| /s/ Mahesh Choudhury | |||
| By: | Mahesh Choudhury (Nov 12, 2025 15:36:35 EST) | (signature) | |
| Seller: KEEN ENERGY TECHNOLOGIES LLC | |||
| Name: MAHESH PRASAD | |||
| Title: Owner | |||
| Address: 2550 114th Street STE 105A, Grand Prairie TX 75050 | |||
| TAX ID: - 991813856 | |||
| /s/ Mahesh Choudhury | |||
| By: | Mahesh Choudhury (Nov 12, 2025 15:36:35 EST) | (signature) | |
| Seller: AURAI LLC | |||
| Name: MAHESH PRASAD | |||
| Title: Owner | |||
| Address: 2 MOUNT ROYAL AVE , Marlborough MA 01752 | |||
| TAX ID: - 010566432 | |||
| /s/ Mahesh Choudhury | |||
| By: | Mahesh Choudhury (Nov 12, 2025 15:36:35 EST) | (signature) |
| 9 | Initials , |
| Seller: ABSOLUTELY COOL AIR CONDITIONING LLC | ||
| Name: MAHESH PRASAD | ||
| Title: Owner | ||
| Address: 603 Northwest Buck Hendry Way, Stuart FL 34994 |
| TAX ID: - 010772180 | |||
| /s/ Mahesh Choudhury | |||
| By: | Mahesh Choudhury (Nov 12, 2025 15:36:35 EST) | (signature) | |
| Seller: CONNECTM DE LLC | |||
| Name: MAHESH PRASAD | |||
| Title: Owner | |||
| Address: , MA | |||
| TAX ID: - 332143715 | |||
| /s/ Mahesh Choudhury | |||
| By: | Mahesh Choudhury (Nov 12, 2025 15:36:35 EST) | (signature) | |
Agreement of Guarantor: By signing below each Guarantor agrees to the terms and conditions contained in this Agreement, and further agrees that this transaction is for business purposes.
Notice: This Agreement contains a guaranty of performance, and by signing below, you agree that you will be personally liable for the prompt and complete performance of the Guaranteed Obligations as described in the GUARANTY OF PERFORMANCE section above.
| /s/ Mahesh Choudhury | ||
| Guarantor Name: MAHESH PRASAD | Guarantor Signature: | Mahesh Choudhury (Nov 12, 2025 15:36:35 EST) |
Signer’s Title Owner
GUARANTY OF PERFORMANCE – Each of the undersigned Guarantors agrees to the following terms:
| 31. | Guaranteed Obligations. Guarantor agrees to irrevocably, absolutely and unconditionally guarantee to Buyer prompt and complete performance of the following obligations of Seller (the “Guaranteed Obligations”): |
| a. | Seller’s obligation to not (i) change any Authorized Account without the express written consent of Buyer, (ii) create any new depository account, (iii) revoke Buyer’s authorization to debit an Authorized Account, (iv) close an Authorized Account without the express written consent of Buyer or (v) take any other action that denies, or interferes with, Buyer’s rights under this Agreement, including but not limited to Buyer’s right to receive its share of revenue received by Seller; |
| b. | Seller’s obligation to not conduct Seller’s businesses under any name other than as disclosed to Buyer; |
| c. | Seller’s obligation to not change any of its places of business without prior written consent by Buyer; |
| 10 | Initials , |
| d. | Seller’s obligation to not voluntarily sell, dispose, transfer or otherwise convey its business or substantially all business assets without (i) the express prior written consent of Buyer, and (ii) the written agreement of any purchaser or transferee assuming all of Seller's obligations under this Agreement pursuant to documentation satisfactory to Buyer; |
| e. | Seller’s obligation to not enter into any other agreement for the sale of Future Receipts, or any loan agreement that encumbers Seller’s Future Receipts or requires daily payments with any party other than Buyer without Buyer’s prior written consent for the duration of this Agreement; and |
| f. | Seller’s obligation to provide truthful, accurate, complete and timely information as required by this Agreement. |
| 32. | Guarantor Waivers. Buyer does not have to notify Guarantor of any of the following events and Guarantor will not be released from its obligations under the Agreement and this Guaranty of Performance if it is not notified of: (i) Seller’s failure to timely perform any obligation under the Agreement, (ii) any adverse change in Seller’s financial condition or business, (iii) Buyer’s acceptance of the Agreement, and (iv) any renewal, extension or other modification of the Agreement or Seller’s other obligations to Buyer. In addition, Buyer may take any of the following actions without releasing Guarantor from any of its obligations under the Agreement and this Guaranty of Performance: (i) renew, extend or otherwise modify the Agreement or Seller’s other obligations to Buyer, and (ii) release Seller from its obligations to Buyer. Guarantor shall not seek reimbursement from Seller or any other guarantor for any amounts paid by it under the Agreement or this Guaranty of Performance. Guarantor permanently waives and shall not seek to exercise any of the following rights that it may have against Seller, or any other guarantor, for any amounts paid by it, or acts performed by it, under the Agreement or this Guaranty of Performance: (i) subrogation, (ii) reimbursement, (iii) performance, (iv) indemnification, or (v) contribution. |
| 33. | Guarantor Acknowledgement. Each Guarantor acknowledges that Guarantor understands the seriousness of the provisions of the Agreement, including the following Sections: Credit Report and Financial Information Authorizations; Notices; Binding Effect, Governing Law, Venue and Jurisdiction; Survival of Representations, Warranties and Covenants; Interpretation; Entire Agreement and Severability; Execution; Authorization to Contact; Jury Waiver; Class Action Waiver; Arbitration; and Right to Opt Out of Arbitration. |
| 34. | Service of Process. Each Merchant and each Guarantor consent to service of process and legal notices made by First Class or Priority Mail delivered by the United States Postal Service and addressed to the address(es) set forth on the first page of this Agreement or any other address(es) provided in writing to the Purchaser by any Merchant or Guarantor, and unless applicable law or rules provide otherwise, any such service will be deemed complete upon dispatch. Each Merchant and each Guarantor agrees that it will be precluded from asserting that it did not receive service of process or any other notice mailed to the address(es) set forth on the first page of this Agreement if it does not furnish a certified mail receipt signed by the Purchaser that the Purchaser was provided with notice of a change in the contact address(es). |
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK. SIGNATURE PAGE FOLLOWS.]
| 11 | Initials , |
Signature Page to Sale of Future Receipts Agreement
Agreement of Seller: By signing below Seller agrees to the terms and conditions contained in this Agreement, and further agrees that this transaction is for business purposes.
| Seller: COUNTY COMFORT SERVICES LLC | |||
| Name: MAHESH PRASAD | |||
| Title: Owner | |||
| /s/ Mahesh Choudhury | |||
| By: | Mahesh Choudhury (Nov 12, 2025 15:36:35 EST) | (signature) | |
| Seller: SOLAR ENERGY SYSTEMS OF BREVARD, INC. | |||
| Name: MAHESH PRASAD | |||
| Title: Owner | |||
| /s/ Mahesh Choudhury | |||
| By: | Mahesh Choudhury (Nov 12, 2025 15:36:35 EST) | (signature) | |
| Seller: KEEN ENERGY TECHNOLOGIES LLC | |||
| Name: MAHESH PRASAD | |||
| Title: Owner | |||
| /s/ Mahesh Choudhury | |||
| By: | Mahesh Choudhury (Nov 12, 2025 15:36:35 EST) | (signature) | |
| Seller: AURAI LLC | |||
| Name: MAHESH PRASAD | |||
| Title: Owner | |||
| /s/ Mahesh Choudhury | |||
| By: | Mahesh Choudhury (Nov 12, 2025 15:36:35 EST) | (signature) | |
| Seller: ABSOLUTELY COOL AIR CONDITIONING LLC | |||
| Name: MAHESH PRASAD | |||
| Title: Owner | |||
| /s/ Mahesh Choudhury | |||
| By: | Mahesh Choudhury (Nov 12, 2025 15:36:35 EST) | (signature) | |
| Seller: CONNECTM DE LLC | |||
| Name: MAHESH PRASAD | |||
| Title: Owner | |||
| /s/ Mahesh Choudhury | |||
| By: | Mahesh Choudhury (Nov 12, 2025 15:36:35 EST) | (signature) | |
Agreement of Guarantor: By signing below each Guarantor agrees to the terms and conditions contained in this Agreement, and further agrees that this transaction is for business purposes.
| 12 | Initials , |
Notice: This Agreement contains a guaranty of performance, and by signing below, you agree that you will be personally liable for the prompt and complete performance of the Guaranteed Obligations as described in the GUARANTY OF PERFORMANCE section above.
| /s/ Mahesh Choudhury | ||
| Guarantor Name: MAHESH PRASAD | Guarantor Signature: | Mahesh Choudhury (Nov 12, 2025 15:36:35 EST) |
Signer’s Title Owner
| 13 | Initials , |
AUTHORIZATION AGREEMENT
FOR AUTOMATED CLEARING HOUSE TRANSACTIONS
This Authorization Agreement is provided to Ace Funding Source LLC (“Buyer”) by each Seller identified on the Signature Page to this Authorization Agreement. This Authorization Agreement is provided pursuant to the Sale of Future Receipts Agreement (the “Sale Agreement”) entered into between such Seller and the Buyer. Capitalized terms used in this Authorization Agreement without definition shall have the meanings set forth in the Sale Agreement.
By signing this Authorization Agreement, each Seller agrees to the following:
Seller hereby authorizes Buyer to present automated clearing house (ACH) debits to the account identified on the Signature Page to this Authorization Agreement in the amount of any Periodic Amount due on a Remittance Day, or any other amount due to Buyer from Seller (or otherwise authorized to be debited) under the terms of the Sale Agreement, as it may be amended, supplemented or replaced from time to time. Seller acknowledges that each such identified account is an “Authorized Account” as defined in the Sale Agreement. Seller also authorizes Buyer to initiate credit entries to deliver the Net Funded Amount to Seller and authorizes Buyer to initiate additional entries (debits and credits) to any Authorized Account to correct any erroneous transfers.
If Seller breaches the Sale Agreement, Seller authorizes Buyer to debit any and all accounts controlled by Seller or controlled by any entity with the same Federal Tax Identification Number as Seller up to the total amount, including but not limited to, all fees and charges, due to Buyer from Seller under the terms of the Sale Agreement.
Seller authorizes Buyer to contact Seller’s financial institution to obtain available funds information and/or to verify any information Seller has provided about the Authorized Account and to correct any missing, erroneous or out-of-date information.
Seller represents and warrants that each Authorized Account is established and used primarily for commercial/business purposes, and not for consumer, family or household purposes. Seller agrees to be bound by the Rules and Operating Guidelines of Nacha. Seller understands and agrees that any revocation or attempted revocation of this Authorization Agreement will constitute a breach of the Sale Agreement. In the event that Seller closes an Authorized Account, or the Authorized Account has insufficient funds for any ACH transaction under this Authorization Agreement, Seller authorizes Buyer to contact Seller’s financial institution and obtain information (including account number, routing number and available balance) concerning any other deposit account(s) maintained by Seller with Seller’s financial institution, and to initiate ACH transactions under this Authorization Agreement to such additional account(s). To the extent necessary, Seller grants Buyer a limited Power of Attorney to take action in Seller’s name to facilitate this Authorization Agreement.
Seller understands that the Authorization Agreement is a fundamental condition to induce Buyer to enter into the Sale Agreement. Consequently, this Authorization Agreement is intended to be irrevocable during the course of the Sale Agreement and shall remain in full force and effect until Buyer has received all amounts due or that may become due to Buyer under the Sale Agreement.
[Signature Page follows]
| 14 | Initials , |
Signature Page to Authorization Agreement
By signing below, each Seller represents that it is the holder of the account identified immediately above its signature, and agrees that such account is an “Authorized Account” account as described in the Authorization Agreement.
| Account Name: | COUNTY COMFORT SERVICES LLC | ||
| (Name of account exactly as it appears on Seller’s bank statement) | |||
| Bank Name: | BANK OF AMERICA, N.A. | ||
| ABA Transit/Routing Number: | 011000138 | ||
| Account Number: | 466023663330 | ||
| COUNTY COMFORT SERVICES LLC | |||
| Seller Signature | Signature: | Mahesh Choudhury | |
| Mahesh Choudhury (Nov 12, 2025 15:36:35 EST) | |||
| Name/Title of signer: MAHESH PRASAD, Owner | |||
| Account Name: | COUNTY COMFORT SERVICES LLC | ||
| (Name of account exactly as it appears on Seller’s bank statement) | |||
| Bank Name: | BANK OF AMERICA, N.A. | ||
| ABA Transit/Routing Number: | 011000138 | ||
| Account Number: | 466024230746 | ||
| COUNTY COMFORT SERVICES LLC | |||
| Seller Signature | Signature: | Mahesh Choudhury | |
| Mahesh Choudhury (Nov 12, 2025 15:36:35 EST) | |||
| Name/Title of signer: MAHESH PRASAD, Owner | |||
| Account Name: | COUNTY COMFORT SERVICES LLC | ||
| (Name of account exactly as it appears on Seller’s bank statement) | |||
| Bank Name: | BANK OF AMERICA, N.A. | ||
| ABA Transit/Routing Number: | 011000138 | ||
| Account Number: | 466024230759 | ||
| COUNTY COMFORT SERVICES LLC | |||
| Seller Signature | Signature: | Mahesh Choudhury | |
| Mahesh Choudhury (Nov 12, 2025 15:36:35 EST) | |||
| Name/Title of signer: MAHESH PRASAD, Owner | |||
| 15 | Initials , |
Emergency Contacts
3 emergency contacts are required to receive funding. Contacts are used if you
cannot be reached and can be an employee, friend or family member.
Contacts will be verified.
Name: Mahesh Choudhury
Relation: Manager
Phone Number: 7703306879
Email Address: [email protected]
Name: Mahesh Choudhury
Relation: Self
Phone Number: 7703306879
Email Address: [email protected]
Name: Mahesh Choudhury
Relation: self
Phone Number: 7703306879
Email Address: [email protected]
| |
COUNTY COMFORT SERVICES
| Final Audit Report | 2025-11-12 |
| Created: | 2025-11-12 |
| By: | ACE Partners ([email protected]) |
| Status: | Signed |
| Transaction ID: | CBJCHBCAABAAp44KfqtnBmuVKxdyeul8R3JI4In9LJ2z |
"COUNTY COMFORT SERVICES" History
 | Document
created by ACE Partners ([email protected]) 2025-11-12 - 8:26:21 PM GMT |
 | Document
emailed to [email protected] for signature 2025-11-12 - 8:26:27 PM GMT |
 | Email
viewed by [email protected] 2025-11-12 - 8:27:55 PM GMT |
 | Signer
[email protected] entered name at signing as Mahesh Choudhury 2025-11-12 - 8:36:33 PM GMT |
 | Document
e-signed by Mahesh Choudhury ([email protected]) Signature Date: 2025-11-12 - 8:36:35 PM GMT - Time Source: server |
 | Agreement
completed. 2025-11-12 - 8:36:35 PM GMT |
Exhibit 10.10
Funding date__________ Time:________________ |
DISBURSEMENT AUTHORIZATION
| TO: | Vanquish Funding Group Inc. |
| FROM: | ConnectM Technology Solutions, Inc. Tranche #__ - _______ (CNTM) Convertible 2 Mount Royal Avenue, Suite 550 Marlborough, Massachusetts 01752 |
| DATE: | November 25, 2025 |
| RE: | Disbursement of Funds for the Purchase of Securities |
In connection with the funding of an aggregate of $230,160.00 (including $24,660.00 of Original Issue Discount) pursuant to that certain Securities Purchase Agreement dated as of November 25, 2025 (the “Agreement”), you are hereby directed to disburse such funds as follows:
| 1. | $192,000.00 to ConnectM Technology Solutions, Inc. in accordance with the wire transfer instructions attached as Schedule A hereto; |
| 2. | $8,000.00 to Digital Offering LLC, a registered Broker/Dealer and member FINRA/SIPC, in accordance with the wire transfer instructions attached as Schedule B hereto; |
| 3. | $2,000.00 to Naidich Wurman LLP for legal fee reimbursement; and |
| 4. | $3,500.00 to be retained by Vanquish Funding Group Inc. for a due diligence fee. |
Upon receipt of such funds, you may release from escrow the Note, the Purchase Agreement and the instructions to Transfer Agent (each as defined in the Agreement).
| /s/ Bhaskar Panigrahi | |
| Bhaskar Panigrahi | |
| Chief Executive Officer |
Schedule A
xxxx
Bank Name:
Account Name:
Swift Code:
Routing #:
Account#:
Bank Address:
Schedule B
Wiring Instructions:
Chase Bank
30202 Crown Valley Parkway
Laguna Niguel, CA 92677
ABA Routing #: 322271627
Credit Account #: 682012870
Account Name: Digital Offering LLC
EIN: 46-0619588
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT.
THE ISSUE PRICE OF THIS NOTE IS $230,160.00
THE ORIGINAL ISSUE DISCOUNT IS $24,660.00
| Principal Amount: $230,160.00 | Issue Date: November 25, 2025 | |
| Purchase Price: $205,500.00 |
PROMISSORY NOTE
FOR VALUE RECEIVED, ConnectM Technology Solutions, Inc., a Delaware corporation (hereinafter called the “Borrower”), hereby promises to pay to the order of Vanquish Funding Group Inc. a Virginia corporation, or registered assigns (the “Holder”) the sum of $230,160.00 together with any interest as set forth herein, on September 30, 2026 (the “Maturity Date”), and to pay interest on the unpaid principal balance hereof from the date hereof (the “Issue Date”) as set forth herein. This Note may not be prepaid in whole or in part except as otherwise explicitly set forth herein. Any amount of principal or interest on this Note which is not paid when due shall bear interest at the rate of twenty two percent (22%) per annum from the due date thereof until the same is paid (“Default Interest”). All payments due hereunder (to the extent not converted into common stock, $0.0001 par value per share (the “Common Stock”) in accordance with the terms hereof) shall be made in lawful money of the United States of America. All payments shall be made at such address as the Holder shall hereafter give to the Borrower by written notice made in accordance with the provisions of this Note. Each capitalized term used herein, and not otherwise defined, shall have the meaning ascribed thereto in that certain Securities Purchase Agreement dated the date hereof, pursuant to which this Note was originally issued (the “Purchase Agreement”).
This Note is free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the Borrower and will not impose personal liability upon the holder thereof.
The following terms shall apply to this Note:
ARTICLE I. GENERAL TERMS
1.1 Interest. A one-time interest charge of twelve percent (12%) (the “Interest Rate”) shall be applied on the Issuance Date to the Principal ($230,160.00 * twelve percent (12%) = $27,619.00). Interest hereunder shall be paid as set forth herein to the Holder or its assignee in whose name this Note is registered on the records of the Company regarding registration and transfers of Notes in cash or, in the Event of Default, at the Option of the Holder, converted into share of Common Stock as set forth herein.
1.2 Mandatory Monthly Payments. Accrued, unpaid interest and outstanding principal, subject to adjustment, shall be paid in five (5) payments as follows:
| Payment Date | Amount of Payment | |||
| May 30, 2026 | $ | 128,889.50 | ||
| June 30, 2026 | $ | 32,222.38 | ||
| July 30, 2026 | $ | 32,222.38 | ||
| August 30, 2026 | $ | 32,222.38 | ||
| September 30, 2026 | $ | 32,222.36 | ||
(a total payback to the Holder of $257,779.00).
The Company shall have a five (5) day grace period with respect to each payment. The Company has right to prepay in full at any time with no prepayment penalty. All payments shall be made by bank wire transfer to the Holder’s wire instructions, attached hereto as Exhibit A. For the avoidance of doubt, a missed payment shall be considered an Event of Default.
1.3 Prepayment Discount. Notwithstanding anything to the contrary contained in this Note, at any time during the period set forth on the table immediately following this paragraph (the “Prepayment Period”) or as otherwise agreed to between the Borrower and the Holder, the Borrower shall have the right, exercisable on not more than three (3) Trading Days prior written notice to the Holder of the Note to prepay the outstanding Note (principal and accrued interest), in full, in accordance with this Section 1.3. Any notice of prepayment hereunder (an “Optional Prepayment Notice”) shall be delivered to the Holder of the Note at its registered addresses and shall state: (1) that the Borrower is exercising its right to prepay the Note, and (2) the date of prepayment which shall be not more than three (3) Trading Days from the date of the Optional Prepayment Notice. On the date fixed for prepayment (the “Optional Prepayment Date”), the Borrower shall make payment of the Optional Prepayment Amount (as defined below) to Holder, or upon the direction of the Holder as specified by the Holder in a writing to the Borrower (which shall direction to be sent to Borrower by the Holder at least one (1) business day prior to the Optional Prepayment Date). If the Borrower exercises its right to prepay the Note, the Borrower shall make payment to the Holder of an amount in cash equal to the percentage (“Prepayment Percentage”) as set forth in the table immediately following this paragraph opposite the Prepayment Period, multiplied by the sum of the then outstanding principal amount of this Note plus any accrued and unpaid interest on the unpaid principal amount of this Note to the Optional Prepayment Date (the “Optional Prepayment Amount”).
| Prepayment Period | Prepayment Percentage | |||
| 1. The period beginning on the Issue Date and ending on the date which is ninety (90) days following the Issue Date. | 97 | % | ||
| 2. The period beginning on the date which is ninety-one (91) days following the Issue Date and ending on the date which is one hundred eighty (180) days following the Issue Date | 98 | % | ||
2
ARTICLE II. CERTAIN COVENANTS
2.1 Sale of Assets. So long as the Borrower shall have any obligation under this Note, the Borrower shall not, without the Holder’s written consent, sell, lease or otherwise dispose of any significant portion of its assets outside the ordinary course of business. Any consent to the disposition of any assets may be conditioned on a specified use of the proceeds of disposition.
ARTICLE III. EVENTS OF DEFAULT
If any of the following events of default (each, an “Event of Default”) shall occur:
3.1 Failure to Pay Principal and Interest. The Borrower fails to pay the principal hereof or interest thereon when due on this Note, whether at maturity, upon acceleration or otherwise and such breach continues for a period of five (5) days after written notice from the Holder.
3.2 Conversion and the Shares. The Borrower fails to issue shares of Common Stock to the Holder (or announces or threatens in writing that it will not honor its obligation to do so) upon exercise by the Holder of the conversion rights of the Holder in accordance with the terms of this Note (following an Event of Default other than this Section 3.2), fails to transfer or cause its transfer agent to transfer (issue) (electronically or in certificated form) any certificate for shares of Common Stock issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note, the Borrower directs its transfer agent not to transfer or delays, impairs, and/or hinders its transfer agent in transferring (or issuing) (electronically or in certificated form) any certificate for shares of Common Stock to be issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note, or fails to remove (or directs its transfer agent not to remove or impairs, delays, and/or hinders its transfer agent from removing) any restrictive legend (or to withdraw any stop transfer instructions in respect thereof) on any certificate for any shares of Common Stock issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note (or makes any written announcement, statement or threat that it does not intend to honor the obligations described in this paragraph) and any such failure shall continue uncured (or any written announcement, statement or threat not to honor its obligations shall not be rescinded in writing) for three (3) business days after the Holder shall have delivered a Notice of Conversion. It is an obligation of the Borrower to remain current in its obligations to its transfer agent. It shall be an event of default of this Note, if a conversion of this Note is delayed, hindered or frustrated due to a balance owed by the Borrower to its transfer agent. If at the option of the Holder, the Holder advances any funds to the Borrower’s transfer agent in order to process a conversion, such advanced funds shall be paid by the Borrower to the Holder within forty-eight (48) hours of a demand from the Holder.
3.3 Breach of Covenants. The Borrower breaches any material covenant or other material term or condition contained in this Note and any collateral documents including but not limited to the Purchase Agreement and such breach continues for a period of twenty (20) days after written notice thereof to the Borrower from the Holder.
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3.4 Breach of Representations and Warranties. Any representation or warranty of the Borrower made herein or in any agreement, statement or certificate given in writing pursuant hereto or in connection herewith (including, without limitation, the Purchase Agreement), shall be false or misleading in any material respect when made and the breach of which has (or with the passage of time will have) a material adverse effect on the rights of the Holder with respect to this Note or the Purchase Agreement.
3.5 Receiver or Trustee. The Borrower or any subsidiary of the Borrower shall make an assignment for the benefit of creditors, or apply for or consent to the appointment of a receiver or trustee for it or for a substantial part of its property or business, or such a receiver or trustee shall otherwise be appointed.
3.6 Bankruptcy. Bankruptcy, insolvency, reorganization or liquidation proceedings or other proceedings, voluntary or involuntary, for relief under any bankruptcy law or any law for the relief of debtors shall be instituted by or against the Borrower or any subsidiary of the Borrower.
3.7 Delisting of Common Stock. The Borrower shall fail to maintain the listing of the Common Stock on the OTC Markets, Nasdaq National Market, the Nasdaq SmallCap Market, the New York Stock Exchange, or the NYSE American Stock Exchange.
3.8 Failure to Comply with the Exchange Act. The Borrower shall fail to comply with the reporting requirements of the Exchange Act; and/or the Borrower shall cease to be subject to the reporting requirements of the Exchange Act.
3.9 Liquidation. Any dissolution, liquidation, or winding up of Borrower or any substantial portion of its business.
3.10 Cessation of Operations. Any cessation of operations by Borrower or Borrower admits it is otherwise generally unable to pay its debts as such debts become due, provided, however, that any disclosure of the Borrower’s ability to continue as a “going concern” shall not be an admission that the Borrower cannot pay its debts as they become due.
3.11 Financial Statement Restatement. The restatement of any financial statements filed by the Borrower with the SEC at any time after 180 days after the Issuance Date for any date or period until this Note is no longer outstanding, if the result of such restatement would, by comparison to the un-restated financial statement, have constituted a material adverse effect on the rights of the Holder with respect to this Note or the Purchase Agreement.
3.12 Replacement of Transfer Agent. In the event that the Borrower proposes to replace its transfer agent, the Borrower fails to provide, prior to the effective date of such replacement, a fully executed Irrevocable Transfer Agent Instructions in a form as initially delivered pursuant to the Purchase Agreement (including but not limited to the provision to irrevocably reserve shares of Common Stock in the Reserved Amount) signed by the successor transfer agent to Borrower and the Borrower.
3.13 Cross-Default. Notwithstanding anything to the contrary contained in this Note or the other related or companion documents, a breach or default by the Borrower of any covenant or other term or condition contained in any of the Other Agreements, after the passage of all applicable notice and cure or grace periods, shall, at the option of the Holder, be considered a default under this Note and the Other Agreements, in which event the Holder shall be entitled (but in no event required) to apply all rights and remedies of the Holder under the terms of this Note and the Other Agreements by reason of a default under said Other Agreement or hereunder. “Other Agreements” means, collectively, all agreements and instruments between, among or by: (1) the Borrower, and, or for the benefit of, (2) the Holder and any affiliate of the Holder, including, without limitation, promissory notes; provided, however, the term “Other Agreements” shall not include the related or companion documents to this Note. Each of the loan transactions will be cross-defaulted with each other loan transaction and with all other existing and future debt of Borrower to the Holder. Furthermore, notwithstanding anything contained herein to the contrary or in any of the Other Agreements to the contrary, in the event of default of any Other Agreements and such Other Agreements are convertible into shares of Common Stock, Section 4.6 (d) Adjustment Due to Market Price hereof shall be applied to each such Other Agreement as if such section was included within such Other Agreement and the principal amount due with respect to such Other Agreement shall be adjusted accordingly.
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Upon the occurrence and during the continuation of any Event of Default, the Note shall become immediately due and payable and the Borrower shall pay to the Holder, in full satisfaction of its obligations hereunder, an amount equal to 150% (“Default Percentage”) times the sum of (w) the then outstanding principal amount of this Note plus (x) accrued and unpaid interest on the unpaid principal amount of this Note to the date of payment plus (y) Default Interest, if any, on the amounts referred to in clauses (w) and/or (x) plus (z) any amounts owed to the Holder pursuant to Article IV hereof (the then outstanding principal amount of this Note to the date of payment plus the amounts referred to in clauses (x), (y) and (z) shall collectively be known as the “Default Amount”) and all other amounts payable hereunder shall immediately become due and payable, all without demand, presentment or notice, all of which hereby are expressly waived, together with all costs, including, without limitation, legal fees and expenses, of collection, and the Holder shall be entitled to exercise all other rights and remedies available at law or in equity. Notwithstanding anything to the contrary contained herein, in the event that following an Event of Default (other than Section 3.2), a default pursuant to Section 3.2 occurs, the Default Percentage shall be immediately adjusted to 200%.
If the Borrower fails to pay the Default Amount within five (5) business days of written notice that such amount is due and payable, then the Holder shall have the right at any time, to convert the balance owed pursuant to the note including the Default Amount into shares of common stock of the Company as set forth herein.
ARTICLE IV. CONVERSION RIGHTS
4.1 Conversion Right. At any time following an Event of Default, the Holder shall have the right, to convert all or any part of the outstanding and unpaid amount of this Note into fully paid and non-assessable shares of Common Stock, as such Common Stock exists on the Issue Date, or any shares of capital stock or other securities of the Borrower into which such Common Stock shall hereafter be changed or reclassified at the conversion price determined as provided herein (a “Conversion”); provided, however, that in no event shall the Holder be entitled to convert any portion of this Note in excess of that portion of this Note upon conversion of which the sum of (1) the number of shares of Common Stock beneficially owned by the Holder and its affiliates (other than shares of Common Stock which may be deemed beneficially owned through the ownership of the unconverted portion of the Notes or the unexercised or unconverted portion of any other security of the Borrower subject to a limitation on conversion or exercise analogous to the limitations contained herein) and (2) the number of shares of Common Stock issuable upon the conversion of the portion of this Note with respect to which the determination of this proviso is being made, would result in beneficial ownership by the Holder and its affiliates of more than 4.99% of the outstanding shares of Common Stock. For purposes of the proviso to the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Regulations 13D-G thereunder, except as otherwise provided in clause (1) of such proviso. The beneficial ownership limitations on conversion as set forth in the section may NOT be waived by the Holder. The number of shares of Common Stock to be issued upon each conversion of this Note shall be determined by dividing the Conversion Amount (as defined below) by the applicable Conversion Price then in effect on the date specified in the notice of conversion, in the form attached hereto as Exhibit B(the “Notice of Conversion”), delivered to the Borrower by the Holder in accordance with Section 4.4 below; provided that the Notice of Conversion is submitted by facsimile or e-mail (or by other means resulting in, or reasonably expected to result in, notice) to the Borrower before 6:00 p.m., New York, New York time on such conversion date (the “Conversion Date”); however, if the Notice of Conversion is sent after 6:00pm, New York, New York time the Conversion Date shall be the next business day. The term “Conversion Amount” means, with respect to any conversion of this Note, the sum of (1) the principal amount of this Note to be converted in such conversion plus (2) at the Holder’s option, accrued and unpaid interest, if any, on such principal amount at the interest rates provided in this Note to the Conversion Date, plus (3) at the Holder’s option, Default Interest, if any, on the amounts referred to in the immediately preceding clauses (1) and/or (2) plus (4) at the Holder’s option, any amounts owed to the Holder pursuant to Sections 4.4 hereof. Limitation shall no longer apply to limit the issuance of shares in conversion of this Note.
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The Holder shall be entitled to deduct $1,500.00 from the conversion amount in each Notice of Conversion to cover Holder’s deposit fees associated with each Notice of Conversion. Any additional expenses incurred by Holder with respect to the Borrower’s transfer agent, for the issuance of the Common Stock into which this Note is convertible into, shall immediately and automatically be added to the balance of the Note at such time as the expenses are incurred by Holder.
4.2 Conversion Price. The conversion price (the “Conversion Price”) shall mean 65% multiplied by the lowest Trading Price for the Common Stock during the ten (10) Trading Days prior to the Conversion Date (subject to equitable adjustments by the Borrower relating to the Borrower’s securities or the securities of any subsidiary of the Borrower, combinations, recapitalization, reclassifications, extraordinary distributions and similar events). “Trading Price” means, for any security as of any date, the closing bid price on the OTCQB, OTCQX, Pink Sheets electronic quotation system or applicable trading market (the “OTC”) as reported by a reliable reporting service (“Reporting Service”) designated by the Holder (i.e. Bloomberg) or, if the OTC is not the principal trading market for such security, the closing bid price of such security on the principal securities exchange or trading market where such security is listed or traded or, if no closing bid price of such security is available in any of the foregoing manners, the average of the closing bid prices of any market makers for such security that are listed in the “pink sheets”. If the Trading Price cannot be calculated for such security on such date in the manner provided above, the Trading Price shall be the fair market value as mutually determined by the Borrower and the holders of a majority in interest of the Notes being converted for which the calculation of the Trading Price is required in order to determine the Conversion Price of such Notes. “Trading Day” shall mean any day on which the Common Stock is tradable for any period on the OTC, or on the principal securities exchange or other securities market on which the Common Stock is then being traded.
4.3 Authorized Shares. The Borrower covenants that during the period that the Note is outstanding, the Borrower will reserve from its authorized and unissued Common Stock a sufficient number of shares, free from preemptive rights, to provide for the issuance of Common Stock upon the full conversion of this Note issued pursuant to the Purchase Agreement. The Borrower is required at all times to have authorized and reserved four times the number of shares that is actually issuable upon full conversion of the Note (based on the Conversion Price of the Note in effect from time to time) (the “Reserved Amount”). The Reserved Amount shall be increased from time to time in accordance with the Borrower’s obligations hereunder. The Borrower represents that upon issuance, such shares will be duly and validly issued, fully paid and non-assessable. In addition, if the Borrower shall issue any securities or make any change to its capital structure which would change the number of shares of Common Stock into which the Notes shall be convertible at the then current Conversion Price, the Borrower shall at the same time make proper provision so that thereafter there shall be a sufficient number of shares of Common Stock authorized and reserved, free from preemptive rights, for conversion of the outstanding Note. The Borrower (i) acknowledges that it has irrevocably instructed its transfer agent to issue certificates for the Common Stock issuable upon conversion of this Note, and (ii) agrees that its issuance of this Note shall constitute full authority to its officers and agents who are charged with the duty of executing stock certificates to execute and issue the necessary certificates for shares of Common Stock in accordance with the terms and conditions of this Note.
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If, at any time the Borrower does not maintain the Reserved Amount it will be considered an Event of Default under this Note.
4.4 Method of Conversion.
(a) Mechanics of Conversion. As set forth in Section 4.1 hereof, at any time following an Event of Default, the balance due pursuant to this Note may be converted by the Holder in whole or in part at any time from time to time after the Issue Date, by (A) submitting to the Borrower a Notice of Conversion (by facsimile, e-mail or other reasonable means of communication dispatched on the Conversion Date prior to 6:00 p.m., New York, New York time) and (B) subject to Section 4.4(b), surrendering this Note at the principal office of the Borrower (upon payment in full of any amounts owed hereunder).
(b) Surrender of Note Upon Conversion. Notwithstanding anything to the contrary set forth herein, upon conversion of this Note in accordance with the terms hereof, the Holder shall not be required to physically surrender this Note to the Borrower unless the entire unpaid principal amount of this Note is so converted. The Holder and the Borrower shall maintain records showing the principal amount so converted and the dates of such conversions or shall use such other method, reasonably satisfactory to the Holder and the Borrower, so as not to require physical surrender of this Note upon each such conversion.
(c) Delivery of Common Stock Upon Conversion. Upon receipt by the Borrower from the Holder of a facsimile transmission or e-mail (or other reasonable means of communication) of a Notice of Conversion meeting the requirements for conversion as provided in this Section 4.4, the Borrower shall issue and deliver or cause to be issued and delivered to or upon the order of the Holder certificates for the Common Stock issuable upon such conversion within three (3) business days after such receipt (the “Deadline”) (and, solely in the case of conversion of the entire unpaid principal amount hereof, surrender of this Note) in accordance with the terms hereof and the Purchase Agreement. Upon receipt by the Borrower of a Notice of Conversion, the Holder shall be deemed to be the holder of record of the Common Stock issuable upon such conversion, the outstanding principal amount and the amount of accrued and unpaid interest on this Note shall be reduced to reflect such conversion, and, unless the Borrower defaults on its obligations hereunder, all rights with respect to the portion of this Note being so converted shall forthwith terminate except the right to receive the Common Stock or other securities, cash or other assets, as herein provided, on such conversion. If the Holder shall have given a Notice of Conversion as provided herein, the Borrower’s obligation to issue and deliver the certificates for Common Stock shall be absolute and unconditional, irrespective of the absence of any action by the Holder to enforce the same, any waiver or consent with respect to any provision thereof, the recovery of any judgment against any person or any action to enforce the same, any failure or delay in the enforcement of any other obligation of the Borrower to the holder of record, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder of any obligation to the Borrower, and irrespective of any other circumstance which might otherwise limit such obligation of the Borrower to the Holder in connection with such conversion.
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(d) Delivery of Common Stock by Electronic Transfer. In lieu of delivering physical certificates representing the Common Stock issuable upon conversion, provided the Borrower is participating in the Depository Trust Company (“DTC”) Fast Automated Securities Transfer (“FAST”) program, upon request of the Holder and its compliance with the provisions set forth herein, the Borrower shall use its best efforts to cause its transfer agent to electronically transmit the Common Stock issuable upon conversion to the Holder by crediting the account of Holder’s Prime Broker with DTC through its Deposit and Withdrawal at Custodian (“DWAC”) system.
(e) Failure to Deliver Common Stock Prior to Deadline. Without in any way limiting the Holder’s right to pursue other remedies, including actual damages and/or equitable relief, the parties agree that if delivery of the Common Stock issuable upon conversion of this Note is not delivered by the Deadline due to action and/or inaction of the Borrower, the Borrower shall pay to the Holder $2,000 per day in cash, for each day beyond the Deadline that the Borrower fails to deliver such Common Stock (the “Fail to Deliver Fee”); provided; however that the Fail to Deliver Fee shall not be due if the failure is a result of a third party (i.e., transfer agent; and not the result of any failure to pay such transfer agent) despite the best efforts of the Borrower to effect delivery of such Common Stock. Such cash amount shall be paid to Holder by the fifth day of the month following the month in which it has accrued or, at the option of the Holder (by written notice to the Borrower by the first day of the month following the month in which it has accrued), shall be added to the principal amount of this Note, in which event interest shall accrue thereon in accordance with the terms of this Note and such additional principal amount shall be convertible into Common Stock in accordance with the terms of this Note. The Borrower agrees that the right to convert is a valuable right to the Holder. The damages resulting from a failure, attempt to frustrate, interference with such conversion right are difficult if not impossible to qualify. Accordingly, the parties acknowledge that the liquidated damages provision contained in this Section 4.4(e) are justified.
4.5 Concerning the Shares. The shares of Common Stock issuable upon conversion of this Note may not be sold or transferred unless: (i) such shares are sold pursuant to an effective registration statement under the Act or (ii) the Borrower or its transfer agent shall have been furnished with an opinion of counsel (which opinion shall be in form, substance and scope customary for opinions of counsel in comparable transactions) to the effect that the shares to be sold or transferred may be sold or transferred pursuant to an exemption from such registration (such as Rule 144 or a successor rule) (“Rule 144”); or (iii) such shares are transferred to an “affiliate” (as defined in Rule 144) of the Borrower who agrees to sell or otherwise transfer the shares only in accordance with this Section 4.5 and who is an Accredited Investor (as defined in the Purchase Agreement).
Any restrictive legend on certificates representing shares of Common Stock issuable upon conversion of this Note shall be removed and the Borrower shall issue to the Holder a new certificate therefore free of any transfer legend if the Borrower or its transfer agent shall have received an opinion of counsel from Holder’s counsel, in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect that (i) a public sale or transfer of such Common Stock may be made without registration under the Act, which opinion shall be accepted by the Company so that the sale or transfer is effected; or (ii) in the case of the Common Stock issuable upon conversion of this Note, such security is registered for sale by the Holder under an effective registration statement filed under the Act; or otherwise may be sold pursuant to an exemption from registration. In the event that the Company does not reasonably accept the opinion of counsel provided by the Holder with respect to the transfer of Securities pursuant to an exemption from registration (such as Rule 144), it will be considered an Event of Default pursuant to this Note.
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4.6 Effect of Certain Events.
(a) Effect of Merger, Consolidation, Etc. At the option of the Holder, the sale, conveyance or disposition of all or substantially all of the assets of the Borrower, the effectuation by the Borrower of a transaction or series of related transactions in which more than 50% of the voting power of the Borrower is disposed of, or the consolidation, merger or other business combination of the Borrower with or into any other Person (as defined below) or Persons when the Borrower is not the survivor shall be deemed to be an Event of Default (as defined in Article III) pursuant to which the Borrower shall be required to pay to the Holder upon the consummation of and as a condition to such transaction an amount equal to the Default Amount (as defined in Article III). “Person” shall mean any individual, corporation, limited liability company, partnership, association, trust or other entity or organization.
(b) Adjustment Due to Merger, Consolidation, Etc. If, at any time when this Note is issued and outstanding and prior to conversion of all of the Note, there shall be any merger, consolidation, exchange of shares, recapitalization, reorganization, or other similar event, as a result of which shares of Common Stock of the Borrower shall be changed into the same or a different number of shares of another class or classes of stock or securities of the Borrower or another entity, or in case of any sale or conveyance of all or substantially all of the assets of the Borrower other than in connection with a plan of complete liquidation of the Borrower, then the Holder of this Note shall thereafter have the right to receive upon conversion of this Note, upon the basis and upon the terms and conditions specified herein and in lieu of the shares of Common Stock immediately theretofore issuable upon conversion, such stock, securities or assets which the Holder would have been entitled to receive in such transaction had this Note been converted in full immediately prior to such transaction (without regard to any limitations on conversion set forth herein), and in any such case appropriate provisions shall be made with respect to the rights and interests of the Holder of this Note to the end that the provisions hereof (including, without limitation, provisions for adjustment of the Conversion Price and of the number of shares issuable upon conversion of the Note) shall thereafter be applicable, as nearly as may be practicable in relation to any securities or assets thereafter deliverable upon the conversion hereof. The Borrower shall not affect any transaction described in this Section 4.6(b) unless (a) it first gives, to the extent practicable, ten (10) days prior written notice (but in any event at least five (5) days prior written notice) of the record date of the special meeting of shareholders to approve, or if there is no such record date, the consummation of, such merger, consolidation, exchange of shares, recapitalization, reorganization or other similar event or sale of assets (during which time the Holder shall be entitled to convert this Note) and (b) the resulting successor or acquiring entity (if not the Borrower) assumes by written instrument the obligations of this Note. The above provisions shall similarly apply to successive consolidations, mergers, sales, transfers or share exchanges.
(c) Adjustment Due to Distribution. If the Borrower shall declare or make any distribution of its assets (or rights to acquire its assets) to holders of Common Stock as a dividend, stock repurchase, by way of return of capital or otherwise (including any dividend or distribution to the Borrower’s shareholders in cash or shares (or rights to acquire shares) of capital stock of a subsidiary (i.e., a spin-off)) (a “Distribution”), then the Holder of this Note shall be entitled, upon any conversion of this Note after the date of record for determining shareholders entitled to such Distribution, to receive the amount of such assets which would have been payable to the Holder with respect to the shares of Common Stock issuable upon such conversion had such Holder been the holder of such shares of Common Stock on the record date for the determination of shareholders entitled to such Distribution.
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ARTICLE V. MISCELLANEOUS
5.1 Failure or Indulgence Not Waiver. No failure or delay on the part of the 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 privileges. All rights and remedies existing hereunder are cumulative to, and not exclusive of, any rights or remedies otherwise available.
5.2 Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by hand delivery, telegram, or electronic mail, addressed as set forth below or to such other address as such party shall have specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery or delivery by electronic mail, at the address or number designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall be:
If to the Borrower, to:
ConnectM Technology Solutions, Inc.
2 Mount Royal Avenue, Suite 550
Marlborough, Massachusetts 01752
Attn: Bhaskar Panigrahi, Chief Executive Officer
Email: [email protected]
If to the Holder:
Vanquish Funding Group Inc.
1800 Diagonal Road, Suite 623
Alexandria VA 22314
Attn: Curt Kramer
e-mail: [email protected]
5.3 Amendments. This Note and any provision hereof may only be amended by an instrument in writing signed by the Borrower and the Holder. The term “Note” and all reference thereto, as used throughout this instrument, shall mean this instrument (and the other Notes issued pursuant to the Purchase Agreement) as originally executed, or if later amended or supplemented, then as so amended or supplemented.
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5.4 Assignability. This Note shall be binding upon the Borrower and its successors and assigns, and shall inure to be the benefit of the Holder and its successors and assigns. Each transferee of this Note must be an “accredited investor” (as defined in Rule 501(a) of the Securities and Exchange Commission). Notwithstanding anything in this Note to the contrary, this Note may be pledged as collateral in connection with a bona fide margin account or other lending arrangement; and may be assigned by the Holder without the consent of the Borrower.
5.5 Cost of Collection. If default is made in the payment of this Note, the Borrower shall pay the Holder hereof costs of collection, including reasonable attorneys’ fees.
5.6 Governing Law. This Note shall be governed by and construed in accordance with the laws of the Commonwealth of Virginia without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Note shall be brought only in the Circuit Court of Fairfax County, Virginia or in the Alexandria Division of the United States District Court for the Eastern District of Virginia. The parties to this Note hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. The Borrower and Holder waive trial by jury. The Holder shall be entitled to recover from the Borrower its reasonable attorney’s fees and costs. In the event that any provision of this Note or any other agreement delivered in connection herewith is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of any agreement. Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this Note, any agreement or any other document delivered in connection with this Note by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Note and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
5.7 Purchase Agreement. By its acceptance of this Note, each party agrees to be bound by the applicable terms of the Purchase Agreement.
5.8 Remedies. The Borrower acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder, by vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the Borrower acknowledges that the remedy at law for a breach of its obligations under this Note will be inadequate and agrees, in the event of a breach or threatened breach by the Borrower of the provisions of this Note, that the Holder shall be entitled, in addition to all other available remedies at law or in equity, and in addition to the penalties assessable herein, to an injunction or injunctions restraining, preventing or curing any breach of this Note and to enforce specifically the terms and provisions thereof, without the necessity of showing economic loss and without any bond or other security being required.
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IN WITNESS WHEREOF, Borrower has caused this Note to be signed in its name by its duly authorized officer this on November 25, 2025
| ConnectM Technology Solutions, Inc. | ||
| By: | /s/ Bhaskar Panigrahi | |
| Bhaskar Panigrahi | ||
| Chief Executive Officer | ||
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EXHIBIT A – WIRE INSTRUCTIONS
[to be provided via email]
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EXHIBIT B -- NOTICE OF CONVERSION
The undersigned hereby elects to convert $_________________ principal amount of the Note (defined below) into that number of shares of Common Stock to be issued pursuant to the conversion of the Note (“Common Stock”) as set forth below, of ConnectM Technology Solutions, Inc., a Delaware corporation (the “Borrower”) according to the conditions of the convertible note of the Borrower dated as of November 25, 2025 (the “Note”), as of the date written below. No fee will be charged to the Holder for any conversion, except for transfer taxes, if any.
Box Checked as to applicable instructions:
| ¨ | The Borrower shall electronically transmit the Common Stock issuable pursuant to this Notice of Conversion to the account of the undersigned or its nominee with DTC through its Deposit Withdrawal Agent Commission system (“DWAC Transfer”). |
Name of DTC Prime Broker:
Account Number:
| ¨ | The undersigned hereby requests that the Borrower issue a certificate or certificates for the number of shares of Common Stock set forth below (which numbers are based on the Holder’s calculation attached hereto) in the name(s) specified immediately below or, if additional space is necessary, on an attachment hereto: |
| Date of conversion: | _____________ | |
| Applicable Conversion Price: | $____________ | |
| Number of shares of common stock to be issued pursuant to conversion of the Notes: | _____________ | |
| Amount of Principal Balance due remaining under the Note after this conversion: | _____________ |
| By:_____________________________ | |
| Name: | |
| Title: | |
| Date: __________________ |
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SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT (the “Agreement”), dated as of November 25, 2025, by and between ConnectM Technology Solutions, Inc., a Delaware corporation, with its address at 2 Mount Royal Avenue, Suite 550, Marlborough, Massachusetts 01752 (the “Company”), and Vanquish Funding Group Inc., a Virginia corporation, with its address at 1800 Diagonal Road, Suite 623, Alexandria VA 22314 (the “Buyer”).
WHEREAS:
A. The Company and the Buyer are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by the rules and regulations as promulgated by the United States Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the “1933 Act”); and
B. Buyer desires to purchase and the Company desires to issue and sell, upon the terms and conditions set forth in this Agreement, a bridge note of the Company, in the form attached hereto as Exhibit A, in the aggregate principal amount of $230,160.00 (including $24,660.00 of Original Issue Discount) (the “Note”).
NOW THEREFORE, the Company and the Buyer severally (and not jointly) hereby agree as follows:
1. Purchase and Sale of the Securities.
a. Purchase of the Securities. On the Closing Date (as defined below), the Company shall issue and sell to the Buyer and the Buyer agrees to purchase from the Company the Securities as is set forth immediately below the Buyer’s name on the signature pages hereto.
b. Form of Payment. On the Closing Date (as defined below), (i) the Buyer shall pay the purchase price for the Securities be issued and sold to it at the Closing (as defined below) (the “Purchase Price”) by wire transfer of immediately available funds to the Company, in accordance with the Company’s written wiring instructions, against delivery of the Securities, and (ii) the Company shall deliver such duly executed Note on behalf of the Company against delivery of such Purchase Price.
c. Closing Date. Subject to the satisfaction (or written waiver) of the conditions thereto set forth in Section 6 and Section 7 below, the date and time of the issuance and sale of the Securities pursuant to this Agreement (the “Closing Date”) shall be 12:00 noon, Eastern Standard Time on or about November 25, 2025, or such other mutually agreed upon time. The closing of the transactions contemplated by this Agreement (the “Closing”) shall occur on the Closing Date at such location as may be agreed to by the parties.
2. Buyer’s Representations and Warranties. The Buyer represents and warrants to the Company that:
a. Investment Purpose. As of the date hereof, the Buyer is purchasing the Note and the shares of Common Stock issuable upon conversion of or otherwise pursuant to the Note (such shares of Common Stock being collectively referred to herein as the “Conversion Shares” and, collectively with the Note, the “Securities”) for its own account and not with a present view towards the public sale or distribution thereof, except pursuant to sales registered or exempted from registration under the 1933 Act.
b. Accredited Investor Status. The Buyer is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D (an “Accredited Investor”).
c. Reliance on Exemptions. The Buyer understands that the Securities are being offered and sold to it in reliance upon specific exemptions from the registration requirements of United States federal and state securities laws and that the Company is relying upon the truth and accuracy of, and the Buyer’s compliance with, the representations, warranties, agreements, acknowledgments and understandings of the Buyer set forth herein in order to determine the availability of such exemptions and the eligibility of the Buyer to acquire the Securities.
d. Information. The Company has not disclosed to the Buyer any material nonpublic information and will not disclose such information unless such information is disclosed to the public prior to or promptly following such disclosure to the Buyer.
e. Legends. The Buyer understands that the Securities have not been registered under the 1933 Act; and may bear a restrictive legend in substantially the following form:
“THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES LAWS, AND MAY NOT BE PLEDGED, SOLD, ASSIGNED, HYPOTHECATED OR OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR (2) THE ISSUER OF SUCH SECURITIES RECEIVES AN OPINION OF COUNSEL TO THE BUYER OF SUCH SECURITIES, WHICH COUNSEL AND OPINION ARE REASONABLY ACCEPTABLE TO THE ISSUER’S TRANSFER AGENT, THAT SUCH SECURITIES MAY BE PLEDGED, SOLD, ASSIGNED, HYPOTHECATED OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS.”
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The legend set forth above shall be removed and the Company shall issue a certificate without such legend to the Buyer of any Security upon which it is stamped, if, unless otherwise required by applicable state securities laws, (a) such Security is registered for sale under an effective registration statement filed under the 1933 Act or otherwise may be sold pursuant to an exemption from registration without any restriction as to the number of securities as of a particular date that can then be immediately sold, or (b) such Buyer provides the Company with an opinion of counsel, in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect that a public sale or transfer of such Security may be made without registration under the 1933 Act, which opinion shall be accepted by the Company so that the sale or transfer is effected. The Buyer agrees to sell all Securities, including those represented by a certificate(s) from which the legend has been removed, in compliance with applicable prospectus delivery requirements, if any. In the event that the Company does not reasonably accept the opinion of counsel that properly conforms to applicable securities laws provided by the Buyer with respect to the transfer of any Securities pursuant to an exemption from registration, such as Rule 144, at the Deadline, it will be considered an Event of Default pursuant to Section 3.2 of the Note.
f. Authorization; Enforcement. This Agreement has been duly and validly authorized. This Agreement has been duly executed and delivered on behalf of the Buyer, and this Agreement constitutes a valid and binding agreement of the Buyer enforceable in accordance with its terms.
3. Representations and Warranties of the Company. The Company represents and warrants to the Buyer that:
a. Organization and Qualification. The Company and each of its Subsidiaries (as defined below), if any, is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is incorporated, with full power and authority (corporate and other) to own, lease, use and operate its properties and to carry on its business as and where now owned, leased, used, operated and conducted. “Subsidiaries” means any corporation or other organization, whether incorporated or unincorporated, in which the Company owns, directly or indirectly, any equity or other ownership interest.
b. Authorization; Enforcement. (i) The Company has all requisite corporate power and authority to enter into and perform this Agreement, the Note and to consummate the transactions contemplated hereby and thereby and to issue the Securities, in accordance with the terms hereof and thereof, (ii) the execution and delivery of this Agreement, the Note by the Company and the consummation by it of the transactions contemplated hereby and thereby (including without limitation, the issuance of the Note has been duly authorized by the Company’s Board of Directors and no further consent or authorization of the Company, its Board of Directors, or its shareholders is required, (iii) this Agreement has been duly executed and delivered by the Company by its authorized representative, and such authorized representative is the true and official representative with authority to sign this Agreement and the other documents executed in connection herewith and bind the Company accordingly, and (iv) this Agreement constitutes, and upon execution and delivery by the Company of the Note, each of such instruments will constitute, a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms.
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c. Capitalization. As of the date hereof, the authorized common stock of the Company consists of 250,000,000 authorized shares of Common Stock, $0.0001 par value per share, of which 137,025,012 shares are issued and outstanding. All of such outstanding shares of capital stock are, or upon issuance will be, duly authorized, validly issued, fully paid and non-assessable.
d. Issuance of Shares. The Securities are duly authorized and reserved for issuance in accordance with its respective terms, will be validly issued, fully paid and non-assessable, and free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the Company and will not impose personal liability upon the Buyer thereof.
e. No Conflicts. The execution, delivery and performance of this Agreement, the Note by the Company and the consummation by the Company of the transactions contemplated hereby and thereby will not (i) conflict with or result in a violation of any provision of the Certificate of Incorporation or By-laws, or (ii) violate or conflict with, or result in a breach of any provision of, or constitute a default (or an event which with notice or lapse of time or both could become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture, patent, patent license or instrument to which the Company or any of its Subsidiaries is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities laws and regulations and regulations of any self-regulatory organizations to which the Company or its securities are subject) applicable to the Company or any of its Subsidiaries or by which any property or asset of the Company or any of its Subsidiaries is bound or affected (except for such conflicts, defaults, terminations, amendments, accelerations, cancellations and violations as would not, individually or in the aggregate, have a Material Adverse Effect). The businesses of the Company and its Subsidiaries, if any, are not being conducted, and shall not be conducted so long as the Buyer owns any of the Securities, in violation of any law, ordinance or regulation of any governmental entity. “Material Adverse Effect” means any material adverse effect on the business, operations, assets, financial condition or prospects of the Company or its Subsidiaries, if any, taken as a whole, or on the transactions contemplated hereby or by the agreements or instruments to be entered into in connection herewith.
f. SEC Documents; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required to be filed by it with the SEC pursuant to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “1934 Act”) (all of the foregoing filed prior to the date hereof and all exhibits included therein and financial statements and schedules thereto and documents (other than exhibits to such documents) incorporated by reference therein, being hereinafter referred to herein as the “SEC Documents”). Upon written request the Company will deliver to the Buyer true and complete copies of the SEC Documents, except for such exhibits and incorporated documents. As of their respective dates or if amended, as of the dates of the amendments, the SEC Documents complied in all material respects with the requirements of the 1934 Act and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents, and none of the SEC Documents, at the time they were filed with the SEC, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. None of the statements made in any such SEC Documents is, or has been, required to be amended or updated under applicable law (except for such statements as have been amended or updated in subsequent filings prior the date hereof). As of their respective dates or if amended, as of the dates of the amendments, the financial statements of the Company included in the SEC Documents complied as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto. Such financial statements have been prepared in accordance with United States generally accepted accounting principles, consistently applied, during the periods involved and fairly present in all material respects the consolidated financial position of the Company and its consolidated Subsidiaries as of the dates thereof and the consolidated results of their operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments). The Company is subject to the reporting requirements of the 1934 Act.
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g. Absence of Certain Changes. Since September 30, 2025, except as set forth in the SEC Documents, there has been no material adverse change and no material adverse development in the assets, liabilities, business, properties, operations, financial condition, results of operations, prospects or 1934 Act reporting status of the Company or any of its Subsidiaries.
h. Absence of Litigation. Except as set forth in the SEC Documents, there is no action, suit, claim, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the Company or any of its Subsidiaries, threatened against or affecting the Company or any of its Subsidiaries, or their officers or directors in their capacity as such, that could have a Material Adverse Effect. The Company and its Subsidiaries are unaware of any facts or circumstances which might give rise to any of the foregoing.
i. No Integrated Offering. Neither the Company, nor any of its affiliates, nor any person acting on its or their behalf, has directly or indirectly made any offers or sales in any security or solicited any offers to buy any security under circumstances that would require registration under the 1933 Act of the issuance of the Securities to the Buyer. The issuance of the Securities to the Buyer will not be integrated with any other issuance of the Company’s securities (past, current or future) for purposes of any shareholder approval provisions applicable to the Company or its securities.
j. No Brokers. Except for Digital Offering LLC, the Company has taken no action which would give rise to any claim by any person for brokerage commissions, transaction fees or similar payments relating to this Agreement or the transactions contemplated hereby.
k. No Investment Company. The Company is not, and upon the issuance and sale of the Securities as contemplated by this Agreement will not be an “investment company” required to be registered under the Investment Company Act of 1940 (an “Investment Company”). The Company is not controlled by an Investment Company.
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l. Breach of Representations and Warranties by the Company. If the Company breaches any of the material representations or warranties set forth in this Section 3 which is continuing after the applicable cure period as set forth in the Note, if any, and in addition to any other remedies available to the Buyer pursuant to this Agreement, it will be considered an Event of default under Section 4.4 of the Note.
4. COVENANTS.
a. Best Efforts. The Company shall use its reasonable commercial efforts to satisfy timely each of the conditions described in Section 7 of this Agreement.
b. Use of Proceeds. The Company shall use the proceeds for general working capital purposes.
c. Expenses. At the Closing, the Company’s obligation with respect to the transactions contemplated by this Agreement is to reimburse Buyer’ expenses shall be $5,500.00 for Buyer’s legal fees and due diligence fee.
d. Corporate Existence. So long as the Buyer beneficially owns any Note, the Company shall maintain its corporate existence and shall not sell all or substantially all of the Company’s assets, except with the prior written consent of the Buyer.
e. Breach of Covenants. If the Company breaches any of the material covenants set forth in this Section 4, and in addition to any other remedies available to the Buyer pursuant to this Agreement which is continuing after the applicable cure period as set forth in the Note, it will be considered an event of default under Section 4.4 of the Note.
f. Failure to Comply with the 1934 Act. So long as the Buyer beneficially owns the Note, the Company shall comply with the reporting requirements of the 1934 Act; and the Company shall continue to be subject to the reporting requirements of the 1934 Act.
g. The Buyer is Not a “Dealer”. The Buyer and the Company hereby acknowledge and agree that the Buyer has not: (i) acted as an underwriter; (ii) acted as a market maker or specialist; (iii) acted as “de facto” market maker; or (iv) conducted any other professional market activities such as providing investment advice, extending credit and lending securities in connection; and thus that the Buyer is not a “Dealer” as such term is defined in the 1934 Act.
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5. Transfer Agent Instructions. The Company shall issue irrevocable instructions to its transfer agent to issue certificates, registered in the name of the Buyer or its nominee, for the shares underlying any conversion of the Note upon default of the Note (the “Conversion Shares”) in such amounts as specified from time to time by the Buyer to the Company upon conversion of the Note in accordance with the terms thereof (the “Irrevocable Transfer Agent Instructions”). In the event that the Company proposes to replace its transfer agent, the Company shall provide, prior to the effective date of such replacement, a fully executed Irrevocable Transfer Agent Instructions in a form as initially delivered pursuant to this Agreement (including but not limited to the provision to irrevocably reserve shares of Common Stock in the Reserved Amount as such term is defined in the Note) signed by the successor transfer agent to Company and the Company. Prior to registration of the Conversion Shares under the 1933 Act or the date on which the Conversion Shares may be sold pursuant to an exemption from registration, all such certificates shall bear the restrictive legend specified in Section 2(e) of this Agreement. The Company warrants that: (i) no instruction other than the Irrevocable Transfer Agent Instructions referred to in this Section 5, will be given by the Company to its transfer agent and that the Securities shall otherwise be freely transferable on the books and records of the Company as and to the extent provided in this Agreement and the Note; (ii) it will not direct its transfer agent not to transfer or delay, impair, and/or hinder its transfer agent in transferring (or issuing)(electronically or in certificated form) any certificate for Conversion Shares to be issued to the Buyer upon conversion of or otherwise pursuant to the Note as and when required by the Note and this Agreement; and (iii) it will not fail to remove (or directs its transfer agent not to remove or impairs, delays, and/or hinders its transfer agent from removing) any restrictive legend (or to withdraw any stop transfer instructions in respect thereof) on any certificate for any Conversion Shares issued to the Buyer upon conversion of or otherwise pursuant to the Note as and when required by the Note and/or this Agreement. If the Buyer provides the Company and the Company’s transfer, at the cost of the Buyer, with an opinion of counsel in form, substance and scope customary for opinions in comparable transactions, to the effect that a public sale or transfer of such Securities may be made without registration under the 1933 Act, the Company shall permit the transfer, and, in the case of the Conversion Shares, promptly instruct its transfer agent to issue one or more certificates, free from restrictive legend, in such name and in such denominations as specified by the Buyer. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Buyer, by vitiating the intent and purpose of the transactions contemplated hereby. Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations under this Section 5 may be inadequate and agrees, in the event of a breach or threatened breach by the Company of the provisions of this Section, that the Buyer shall be entitled, in addition to all other available remedies, to an injunction restraining any breach and requiring immediate transfer, without the necessity of showing economic loss and without any bond or other security being required.
6. Conditions to the Company’s Obligation to Sell. The obligation of the Company hereunder to issue and sell the Securities to the Buyer at the Closing is subject to the satisfaction, at or before the Closing Date of each of the following conditions thereto, provided that these conditions are for the Company’s sole benefit and may be waived by the Company at any time in its sole discretion:
a. The Buyer shall have executed this Agreement and delivered the same to the Company.
b. The Buyer shall have delivered the Purchase Price in accordance with Section 1(b) above.
c. The representations and warranties of the Buyer shall be true and correct in all material respects as of the date when made and as of the Closing Date as though made at that time (except for representations and warranties that speak as of a specific date), and the Buyer shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Buyer at or prior to the Closing Date.
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d. No litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.
7. Conditions to The Buyer’s Obligation to Purchase. The obligation of the Buyer hereunder to purchase the Securities at the Closing is subject to the satisfaction, at or before the Closing Date of each of the following conditions, provided that these conditions are for the Buyer’s sole benefit and may be waived by the Buyer at any time in its sole discretion:
a. The Company shall have executed this Agreement and delivered the same to the Buyer.
b. The Company shall have delivered to the Buyer the duly executed Note, in accordance with Section 1(b) above.
c. The Irrevocable Transfer Agent Instructions, in form and substance satisfactory to the Buyer, shall have been delivered to and acknowledged in writing by the Company’s Transfer Agent.
d. The representations and warranties of the Company shall be true and correct in all material respects as of the date when made and as of the Closing Date as though made at such time (except for representations and warranties that speak as of a specific date) and the Company shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company at or prior to the Closing Date. The Buyer shall have received a certificate or certificates, executed by the chief executive officer of the Company, dated as of the Closing Date, to the foregoing effect and as to such other matters as may be reasonably requested by the Buyer including, but not limited to certificates with respect to the Board of Directors’ resolutions relating to the transactions contemplated hereby.
e. No litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.
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f. No event shall have occurred which could reasonably be expected to have a Material Adverse Effect on the Company including but not limited to a change in the 1934 Act reporting status of the Company or the failure of the Company to be timely in its 1934 Act reporting obligations.
8. Governing Law; Miscellaneous.
a. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Virginia without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Agreement shall be brought only in the Circuit Court of Fairfax County, Virginia or in the Alexandria Division of the United States District Court for the Eastern District of Virginia The parties to this Agreement hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. The Company and Buyer waive trial by jury. The Buyer shall be entitled to recover from the Company its reasonable attorney’s fees and costs. In the event that any provision of this Agreement or any other agreement delivered in connection herewith is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of any agreement. Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this Agreement, the Note or any related document or agreement by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
b. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which shall constitute one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party.
c. Headings. The headings of this Agreement are for convenience of reference only and shall not form part of, or affect the interpretation of, this Agreement.
d. Severability. In the event that any provision of this Agreement is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any provision hereof which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision hereof.
e. Entire Agreement; Amendments. This Agreement and the instruments referenced herein contain the entire understanding of the parties with respect to the matters covered herein and therein and, except as specifically set forth herein or therein, neither the Company nor the Buyer makes any representation, warranty, covenant or undertaking with respect to such matters. No provision of this Agreement may be waived or amended other than by an instrument in writing signed by the majority in interest of the Buyer.
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f. Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by hand delivery, telegram, or facsimile, addressed as set forth below or to such other address as such party shall have specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery or delivery by facsimile, with accurate confirmation generated by the transmitting facsimile machine, at the address or number designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall be as set forth in the heading of this Agreement with a copy by fax only to (which copy shall not constitute notice) to Naidich Wurman LLP, 111 Great Neck Road, Suite 214, Great Neck, NY 11021, Attn: Allison Naidich, facsimile: 516-466-3555, e-mail: [email protected]. Each party shall provide notice to the other party of any change in address.
g. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns. Neither the Company nor the Buyer shall assign this Agreement or any rights or obligations hereunder without the prior written consent of the other. Notwithstanding the foregoing, the Buyer may assign its rights hereunder to any person that purchases Securities in a private transaction from the Buyer or to any of its “affiliates,” as that term is defined under the 1934 Act, without the consent of the Company.
h. Survival. The representations and warranties of the Company and the agreements and covenants set forth in this Agreement shall survive the closing hereunder notwithstanding any due diligence investigation conducted by or on behalf of the Buyer. The Company agrees to indemnify and hold harmless the Buyer and all their officers, directors, employees and agents for loss or damage arising as a result of or related to any breach or alleged breach by the Company of any of its representations, warranties and covenants set forth in this Agreement or any of its covenants and obligations under this Agreement, including advancement of expenses as they are incurred.
i. Further Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as the other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.
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j. No Strict Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction will be applied against any party.
k. Remedies. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Buyer by vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations under this Agreement will be inadequate and agrees, in the event of a breach or threatened breach by the Company of the provisions of this Agreement, that the Buyer shall be entitled, in addition to all other available remedies at law or in equity, and in addition to the penalties assessable herein, to an injunction or injunctions restraining, preventing or curing any breach of this Agreement and to enforce specifically the terms and provisions hereof, without the necessity of showing economic loss and without any bond or other security being required.
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IN WITNESS WHEREOF, the undersigned Buyer and the Company have caused this Agreement to be duly executed as of the date first above written.
| ConnectM Technology Solutions, Inc. | ||
| By: | /s/ Bhaskar Panigrahi | |
| Bhaskar Panigrahi | ||
| Chief Executive Officer | ||
| Vanquish Funding Group Inc. | ||
| By: | ||
| Curt Kramer | ||
| President | ||
| Aggregate Principal Amount of Note: | $ | 230,160.00 | ||
| Original Issue Discount | $ | 24,660.00 | ||
| Aggregate Purchase Price: | $ | 205,500.00 |
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CORPORATE RESOLUTION OF THE BOARD OF DIRECTORS
OF
CONNECTM TECHNOLOGY SOLUTIONS, INC.
I, the undersigned, do hereby certify that at a meeting of the Board of Directors of ConnectM Technology Solutions, Inc., a corporation organized under the laws of the State of Delaware (the “Corporation”), duly held on November 25, 2025 at _______________, the following resolution, upon motions made, seconded and carried, was duly adopted and is now in full force and effect:
WHEREAS, the Board of Directors of the Corporation deem it in the best interests of the Corporation to enter into the Securities Purchase Agreement dated November 25, 2025 (the “Agreement”) with Vanquish Funding Group Inc., in connection with the issuance of a note of the Corporation, in the aggregate principal amount of $230,160.00 (the “Note”), convertible into shares of common stock, $0.0001 par value per share, of the Company (the “Common Stock”) in the event of default of the Note, upon the terms and subject to the limitations and conditions set forth in such Note, along with an irrevocable letter agreement with Continental Stock Transfer & Trust Co., the Corporation’s transfer agent, with respect to the reserve of shares of common stock of the Corporation to be issued upon any conversion of the Note; the issuance of such shares of common stock in connection with a conversion of the Note; and the indemnification of Continental Stock Transfer & Trust Co. for all loss, liability, or expense in carrying out the authority and direction contained in the irrevocable letter agreement (the “Letter Agreement”);
NOW, THEREFORE, BE IT:
RESOLVED, that the Corporation is hereby authorized to enter into the Agreement, the Note and the Letter Agreement which provides in pertinent part: (i) reserve shares of common stock of the Corporation to be issued upon any conversion of the Note; (ii) issue such shares of common stock in connection with a conversion of the Note (issuance upon receipt of a notice of conversion of the holder of the Note) without any further action or confirmation by the Corporation; and the Corporation indemnifies Continental Stock Transfer & Trust Co. for all loss, liability, or expense in carrying out the authority and direction contained in the Letter Agreement:
RESOLVED, that any executive officer of the Corporation be, and hereby is, authorized, empowered and directed, from time to time, to take such additional action and to execute, certify and deliver to the transfer agent of the Corporation, as any appropriate or proper to implement the provisions of the foregoing resolutions:
I, the undersigned, do hereby certify that I am a member of the Board of Directors of the Corporation; that the attached is a true and correct copy of resolutions duly adopted and ratified at a meeting of the Board of Directors of the Corporation duly convened and held in accordance with its by-laws and the laws of the State of Delaware, as transcribed by me from the minutes; and that the same have not in any way been modified, repealed or rescinded and are in full force and effect.
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IN WITNESS WHEREOF, I have hereunto set my hands as a member of the Board of Directors of the Corporation.
| Dated: November 25, 2025 | /s/ Bhaskar Panigrahi |
| Bhaskar Panigrahi | |
| Member of the Board |
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OFFICER’S CERTIFICATE
The undersigned, Bhaskar Panigrahi, Chief Executive Officer of ConnectM Technology Solutions, Inc., a Delaware Corporation (the “Company”), in connection with the authorization and issuance of the Promissory Note of the Company in the amount of $230,160.00 in accordance with the Securities Purchase Agreement dated November 25, 2025 by and among the Company and Vanquish Funding Group Inc. (the “Purchase Agreement” terms not otherwise defined herein shall have the meaning ascribed to such terms in the Purchase Agreement), hereby certifies that:
1. I am the duly appointed Chief Executive Officer of the Company.
2. The representations and warranties made by the Company in Section 3 of the Purchase Agreement are true and correct in all material respects as of the date of this Officer’s Certificate. The capitalization of the Company described in Section 3(c) of the Purchase Agreement has not changed as of the date hereof.
3. As of the date hereof, the Company has satisfied and duly performed all of the conditions and obligations specified in Section 7 of the Purchase Agreement to be satisfied on or prior to the Closing Date (as defined in the Purchase Agreement) or such conditions and obligations have been waived expressly in writing signed by the purchaser.
4. The Company has complied with or, if compliance prior to Closing (as defined in the Purchase Agreement) is not required, promptly following the Closing the Company will comply with, the filing requirements in respect of this transaction under (a) Regulation D under the Securities Act of 1933, as amended (the “1933 Act”) (and applicable Blue Sky regulations) and (b) the Securities Exchange Act of 1934, as amended.
5. There has been no adverse change in the business, affairs, prospects, operations, properties, assets or condition of the Company since September 30, 2025, the date of the Company’s most recent reviewed financial statements delivered to the Lender (as defined in the Purchase Agreement), other than losses and matters which would not, individually or in the aggregate, have a Material Adverse Effect (as defined in the Purchase Agreement).
6. The Company is qualified as a foreign corporation in all jurisdictions in which the Company owns or leases properties, or conducts any business except where failure of the Company to be so qualified would not have a Material Adverse Effect (as defined in the Purchase Agreement).
IN WITNESS WHEREOF, the undersigned has executed this Officer’s Certificate as of November 25, 2025.
| /s/ Bhaskar Panigrahi | |
| Bhaskar Panigrahi | |
| Chief Executive Officer |
ConnectM Technology Solutions, Inc.
November 25, 2025
Continental StockTransfer & Trust Co.
1 State Street Plaza, 30th Floor
New York, NY 10004
Ladies and Gentlemen:
ConnectM Technology Solutions, Inc., a Delaware corporation (the “Company”) and Vanquish Funding Group Inc., a Virginia corporation (the “Lender”) have entered into a Securities Purchase Agreement dated as of November 25, 2025 (the “Agreement”) providing for the issuance of the Promissory Note in the principal amount of $230,160.00 (the “Note”) which is convertible into common stock of the Company in the event of default of the Note (“Common Stock”).
You are hereby irrevocably authorized and instructed to reserve a sufficient number of shares of Common Stock of the Company (initially, 3,950,000 shares) for issuance upon full conversion of the Note in accordance with the terms thereof. The amount of Common Stock so reserved may be increased, from time to time, upon the written instructions of the Company.
The ability to convert the Note in a timely manner is a material obligation of the Company pursuant to the Note. Provided you are acting as Transfer Agent at the time and provided no single issuance is greater than 4.99% of the issued and outstanding Common Stock of the Company, your firm is hereby irrevocably authorized and instructed to within two (2) Trading days issue shares of Common Stock of the Company to the Lender upon your receipt from the Lender of: (i) a notice of conversion (“Conversion Notice”) executed by the Lender with a copy concurrently delivered to the company, (ii) an opinion of the company’s counsel or counsel of the Lender, confirming that the Common Stock may be issued upon conversion of the Note without any transfer restrictions pursuant to an effective resale Registration Statement or pursuant to the exemption provided by Rule 144 (or any other available exemption) under the Federal Securities Act of 1933, as amended (the “Securities Act”), and (iii) copies of all supporting prospectus or Rule 144 documentation (a seller’s representation letter and a broker’s representation letter if the Common Stock has been held less than twelve months). Common Stock underlying each Conversion Notice should be issued, at the option of the Lender as specified in the Conversion Notice either (i) electronically by crediting the account of a Prime Broker with the Depository Trust Company through its Deposit Withdrawal at Custodian (“DWAC”) system provided the Lender causes its broker or bank to initiate a DWAC deposit or (ii) in certificated form without any restrictive legend which would restrict the transfer of the Common Stock, provided however that if such shares are not able to be sold under Rule 144 or any other exemption under the Securities Act and you have received an opinion from the Company’s or Lender’s counsel that the issuance of the Common Stock is exempt from registration under the Securities Act and when issued the Common Stock will be fully paid and non-assessable, then the issued certificates for such shares shall bear the following restrictive legend:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE SECURITIES MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER SAID ACT, OR AN OPINION OF COUNSEL IN FORM, SUBSTANCE AND SCOPE CUSTOMARY FOR OPINIONS OF COUNSEL IN COMPARABLE TRANSACTIONS, THAT REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT.
The Common Stock shall remain in the created reserve with the Transfer Agent until counsel to the Lender and an authorized officer of the Company provides joint written instructions to the Transfer Agent that the Common Stock or any part of them shall be taken out of the reserve and shall no longer be subject to the terms of these instructions.
The Company shall indemnify you and your officers, directors, principals, partners, agents and representatives, and hold each of them harmless from and against any and all loss, liability, damage, claim or expense (including the reasonable fees and disbursements of its attorneys) incurred by or asserted against you or any of them arising out of or in connection with the instructions set forth herein, the performance of your duties hereunder and otherwise in respect hereof, including the costs and expenses of defending yourself or themselves against any claim or liability including any claim which may be made or asserted by the Company, except that the Company shall not be liable hereunder as to matters in respect of which it is determined that you have acted with gross negligence or in bad faith. You shall have no liability to the Company and the Lender in respect of this if such action was taken or omitted to be taken in good faith, and you shall be entitled to rely in this regard and without liability on the advice of counsel, including counsel selected by you.
The Board of Directors of the Company has approved these irrevocable instructions and does hereby extend the Company’s irrevocable agreement to indemnify your firm for all loss, liability or expense in carrying out the authority and direction herein contained on the terms herein set forth.
The Company agrees that in the event that you resign as the Company’s transfer agent, the Company shall engage a suitable replacement transfer agent that will agree to serve as transfer agent for the Company within five (5) business days. The Company acknowledges that we will have the right to complete any issuance or conversion request received in good order prior to our resignation. It is also understood that you are permitted to resign without any stipulated conditions.
The Lender is intended to be and is a third party beneficiary hereof, and no amendment or modification to the instructions set forth herein may be made without the consent of the Lender.
Notwithstanding any other provision hereof, the Company and the Lender understand that you shall not be required to perform any issuance of the Common Stock if (a) such an issuance or transfer of Common Stock is in violation of any state or federal securities laws or regulations or (b) the issuance of the Common Stock is prohibited or stopped as required or directed by a court order from a court of competent jurisdiction. Additionally, Company and Lender understand that you shall not be required to perform any issuance of the Common Stock if Company is in default of its payment obligations under its agreement with you.
| Very truly yours, | |
| ConnectM Technology Solutions, Inc. | |
| /s/ Bhaskar Panigrahi | |
| Bhaskar Panigrahi | |
| Chief Executive Officer |
| Vanquish Funding Group Inc. | ||
| By: | /s/ Curt Kramer | |
| Curt Kramer | ||
| President | ||
| Acknowledged and Agreed: | ||
| Continental StockTransfer & Trust Co. | ||
| By: | ||
| Name: | ||
| Title: | ||
| Date: | ||
Exhibit 10.11
QUICKBOOKS TERM LOAN AGREEMENT
Loan Number: 7ae9d13592284fe2a8f8dd6c0043255a
Borrower (Business Name) ConnectM Babione, LLC
Business Address: 2 MOUNT ROYAL AVE, MARLBOROUGH, MA, 017521985
Personal Guarantor Name: Mahesh Choudhury
Loan Amount: $175,000.00
Loan Term: 24 Months
Interest Rate/APR: 17.00%
Recurring Payment Amount: $8,649.92
Payment Frequency: month
Funding Date: estimated to be one to two business days after acceptance of this Agreement.
First Payment Due Date: estimated to be one week or one month after the Funding Date, depending on the frequency of the recurring payment term. See section 5 below for details.
Lender: WebBank
Customer Service: (800) 422-8800
Date: 2025-11-23
THIS AGREEMENT INCLUDES AN ARBITRATION PROVISION WITH A CLASS ACTION WAIVER.
PLEASE READ IT CAREFULLY.
1. INTRODUCTION. This Business Loan Agreement ("Agreement") governs your QuickBooks Term Loan Agreement ("Loan"). Please read it and keep it for your reference. In this Agreement, the words "you," "your" and "Borrower" mean the borrower named above, its successor, and assigns and, includes, as appropriate, the personal guarantor named above. The words "Lender", "we", "us" and "our" mean the Lender named above. The words "Guarantor" and "Personal Guarantor" mean the individual that provides a personal guaranty for this Loan as named above. This Agreement is a legal agreement between you and Lender. By clicking "Accept and submit," or other similarly marked button indicating acceptance, you agree to this Agreement. This Agreement includes an Arbitration and Governing Law provision (see Sections 24 and 32 below). For purposes of this Agreement, your principal business address will be deemed the address shown above.
2. LOAN FOR COMMERCIAL PURPOSES ONLY. This is a commercial loan. Borrower represents, warrants and understands that it may use the proceeds of this Loan for business purposes only, and not for any personal, family or household purpose.
Borrower understands that Borrower's agreement not to use the Loan proceeds for personal, family or household purposes means that certain important duties imposed upon entities making loans for consumer purposes, and certain important rights conferred upon consumers, pursuant to federal or state law will not apply to the Loan or the Agreement. Borrower also understands that Lender will be unable to determine whether the Loan conforms to this section and Lender is relying upon this representation and warranty made by Borrower. Borrower agrees that a breach by Borrower of the provisions of this section will not affect Lender's right to (i) enforce Borrower's promise to pay for all amounts owed under this Agreement, regardless of the purpose for which the Loan is in fact obtained or proceeds used, or (ii) use any remedy legally available to Lender, even if that remedy would not have been available had the Loan been made for consumer purposes.
3. DISBURSEMENT OF LOAN PROCEEDS. Borrower authorizes Lender or its authorized representative to initiate a one-time ACH credit entry to the business bank account identified during the Loan application process or as added or updated by Borrower from time to time ("Bank Account") in the amount of the Loan proceeds. Borrower represents and warrants that the Bank Account is not a consumer bank account and is only used for business purposes. The date of disbursement of the Loan proceeds is the "Funding Date." Borrower also authorizes Lender or its authorized representative to initiate one-time ACH debit entries to the Bank Account to correct any error that may have been made in a credit entry.
4. PROMISE TO PAY. Borrower agrees to pay Lender the Loan Amount shown above plus interest at the rate shown above plus all other amounts that may become due under this Agreement pursuant to the payment schedule below. Borrower agrees to repay Lender in U.S. dollars.
5. PAYMENT SCHEDULE. This Loan has the Loan Term shown above. Payments are due on a recurring basis ("Payment Due Date") as shown by the Recurring Payment Amount and Payment Frequency above beginning on the First Payment Due Date and throughout the Loan Term and any loan term extension. For example, the first payment for a loan with a weekly payment cycle is due one week after the Funding Date; the first payment for a loan with a monthly payment cycle is due on the same day of the month one month after the Funding Date, unless the First Payment Due Date falls on the 31st of the month (or, in the case of January, the 29th, 30th, or 31st), in which case the subsequent Payment Due Dates will fall on the last day of each month. Borrower may prepay this Loan in whole or in part at any time prior to the end of the loan term without penalty. Prepayment will not reduce Borrower's scheduled payment amount but may shorten the term of the loan by reducing the total number of payments that Borrower must make. All amounts due under this Agreement that remain unpaid on the final scheduled Payment Due Date will be due on that date, unless the Lender extends the Loan Term at its sole discretion. In consideration of any loan term extension, Borrower agrees to pay all outstanding amounts in full by the agreed upon due date. Such agreement shall not affect the Lender's rights under the terms of this Agreement
6. INTEREST. Interest will accrue daily on the portion of the Loan Amount that remains outstanding beginning on the Funding Date until the Loan is paid in full. Lender may continue to impose interest at the same rate after maturity of the Loan if any amount remains unpaid. The daily rate of interest will be calculated by dividing the Interest Rate shown above by 365 days.
7. FEES. Not Applicable.
8. APPLICATION OF PAYMENTS. Subject to any restrictions under applicable law, Lender reserves the right to apply payments to Borrower's Loan in any manner Lender chooses in Lender's sole discretion.
9. AUTOMATIC PAYMENT AUTHORIZATION. Borrower authorizes Lender or any servicer to initiate an Automated Clearing House (ACH) debit entry to the Bank Account on each Payment Due Date in the amount of each payment due or shortly thereafter provided, however, that if a Payment Due Date falls on a Saturday, Sunday or holiday, then the debit may be initiated on the next business day. Borrower may also authorize Lender or any servicer to initiate ACH debit entries to the Bank Account on any day initiated by the Borrower. Such debits are for payment amounts specified by the Borrower. Any separate payments that Borrower makes on or before a Payment Due Date will not affect this authorization. Borrower understands that the payment due may vary from time to time but will in no event exceed the total amount owed under this Agreement. If a debit is rejected or dishonored, Borrower agrees that Lender or any servicer may re-initiate the ACH debit entry to the Bank Account up to two (2) more times and at any time after the failed ACH entry occurs including on the same date as the next Payment Due Date, subject to network rules. Lender is not liable for any fees or interest that Borrower may incur if Lender is unable to debit Borrower's scheduled payment under this authorization. Lender also is not responsible for any fees imposed on Borrower by the provider of any Bank Account as the result of any authorized debit or any payments made under this authorization. Borrower agrees to maintain sufficient funds in the Bank Account to meet each scheduled payment and any re- initiated payment. Borrower understands that funds must be available by the end of the business day prior to each Payment Due Date and maintained in Borrower's Bank Account until the debit is processed. Lender may modify or terminate this authorization for any reason by notifying Borrower in writing at Borrower's last known business mail or email address in Lender's records. If this authorization is revoked or terminated, Borrower remains responsible for making all remaining payments required under this Agreement by a method set forth in Section 10. ACH transactions must comply with the provisions of U.S. law. Borrower agrees that ACH entries made pursuant to this Agreement are governed solely by the NACHA Operating Rules and agrees to be bound by the NACHA Operating Rules.
10. ALTERNATIVE PAYMENT METHODS. If Borrower knows that for any reason Lender will be unable to process a payment under the Automatic Payment Authorization or if Borrower elects to use a different payment method other than originally specified, then Borrower must promptly either (i) mail a check to Lender in the amount of the scheduled or missed payment; or (ii) authorize a one-time ACH debit entry to a business bank account used solely for business purposes. Borrower may access its online statements or call (800) 422-8800 for additional information on making payments via alternative payment methods. If Borrower elects to send payment by check, then Borrower agrees to send such payment to P.O Box 842978, Dallas, TX 75284-2978 (for regular mails, or Bank of America Lockbox Services, Infomart, Lockbox 842978, 1950 N. Stemmons Fwy., Suite 5010, Dallas, TX 75207 (for express, overnight or courier delivery). All payments must be made in good funds by check from a commercial account used solely for business purposes at a U.S. financial institution in U.S. dollars. Any payment received after 4:30 PM Pacific Time on a Business Day by the Lender or any servicer will be considered to have been made by the Borrower on the next succeeding Business Day. Borrower understands and agrees that payments made to any other address than as specified by Lender may result in a delay in processing and/or crediting and cause interest to accrue on the Loan.
11. POSTDATED CHECKS, RESTRICTED ENDORSEMENT CHECKS AND OTHER DISPUTED OR QUALIFIED PAYMENTS. Lender can accept late, postdated or partial payments without losing any of Lender's rights under this Agreement. Lender is under no obligation to hold a postdated check and Lender reserves the right to process every item presented as if dated the same date received by Lender or Lender's check processor unless Borrower gives Lender adequate notice and a reasonable opportunity to act on it. Except where such notice and opportunity is given, Borrower may not hold Lender liable for depositing any postdated check. Borrower agrees not to send Lender partial payments marked "paid in full," "without recourse," or similar language. If Borrower sends such a payment, Lender may accept it without losing any of Lender's rights under this Agreement. All notices and written communications concerning postdated checks, restricted endorsement checks (including any check or other payment instrument that indicates that the payment constitutes "payment in full" of the amount owed or that is tendered with other conditions or limitations or as full satisfaction of a disputed amount) or any other disputed, nonconforming or qualified payments, must be mailed or delivered to WebBank c/o QuickBooks Capital, P.O. Box 842978, Dallas, TX 75284-2978, or [email protected].
12. ACCESS TO ACCOUNTS. Borrower authorizes the release of information and records to Lender and use by Lender of such information and records for any lawful purpose regarding activity (i) in any Borrower business purpose account associated with a product or service offered by Intuit Inc. or its affiliate, (ii) in any business purpose bank accounts maintained by the Borrower and (iii) in any other business purpose account that Lender deems necessary and appropriate to monitor Borrower's activities. Borrower agrees to provide or authorize sufficient access to view the activity in these accounts at any and all times while this Agreement is in effect. Borrower agrees to notify Lender promptly if Borrower changes any information necessary to identify or access such accounts. Borrower will notify Lender promptly, per Notice requirements in section 29, if Borrower opens a new bank account or Borrower closes an existing bank account.
13. BORROWER'S REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants that: (i) Borrower will comply with all laws, statutes, regulations and ordinances pertaining to the conduct of Borrower's business; (ii) Borrower's principal executive office and the office where Borrower keeps its records concerning its accounts, contract rights and other property is at the address shown above; (iii) Borrower is duly organized, licensed, validly existing and in good standing under the laws of its state of formation and will hereafter remain in good standing in that state, and is duly qualified, licensed and in good standing in every other state in which it is doing business, and will hereafter remain duly qualified, licensed and in good standing in every other state in which it is doing business, and will hereafter remain duly qualified, licensed and in good standing in every other state in which the failure to qualify or become licensed could have a material adverse effect on the financial condition, business or operations of Borrower; (iv) the exact legal name of the Borrower is set forth above; (v) the execution, delivery and performance of this Agreement, and any other document executed in connection herewith, are within Borrower's powers, have been duly authorized, are not in contravention of law or the terms of Borrower's charter, by-laws or other organization papers, or of any indenture, agreement or undertaking to which Borrower is a party; (vi) all organization papers and all amendments thereto of Borrower have been duly filed and are in proper order and any capital stock issued by Borrower and outstanding was and is properly issued and all books and records (including QuickBooks records) of Borrower are accurate and up to date and will be so maintained; (vii) Borrower (a) is subject to no charter, corporate or other legal restriction, or any judgment, award, decree, order, governmental rule or regulation or contractual restriction that could have a material adverse effect on its financial condition, business or prospects, and (b) is in compliance with its organization documents and by-laws, all contractual requirements by which it may be bound; (viii) there is no action, suit, proceeding or investigation pending or, to Borrower's knowledge, threatened against or affecting it or any of its assets before or by any court or other governmental authority which, if determined adversely to it, would have a material adverse effect on its financial condition, business or prospects; (ix) Borrower has no present intention to close or cease operating its business, in whole or in part, temporarily or permanently; and (x) all information provided by or on behalf of Borrower in connection with this Agreement or during the term of this Agreement is and will be true, accurate and complete in all respects.
14. CHANGE IN LEGAL STATUS. Borrower represents and agrees that Borrower will not (i) change its name, its ownership, its place of business or, if more than one, chief executive office, or its mailing address or organizational identification number if it has one, or (ii) change its type of organization, jurisdiction of organization or other legal structure. If Borrower does not have an organizational identification number and later obtains one, Borrower will promptly notify Lender, per notice requirements in section 29, of such organizational identification number.
15. INTEREST AND FEE REFUNDS. If this Loan is subject to a law that sets maximum charges, and that law is finally interpreted so that the interest or other fees collected or to be collected in connection with this Agreement exceed the permitted limits, then (i) any such charge will be reduced by the amount necessary to reduce the charge to the permitted limit and (ii) any sums already collected from Borrower that exceed the permitted limits will be refunded or credited to Borrower.
16. ONLINE STATEMENTS. Borrower may be able to sign in with a valid username and password at a website provided by Lender or its servicer, if and when it is available. Borrower may be able to obtain information about the Borrower's Loan, such as the outstanding balance, by accessing Borrower's online statement via such website or by calling (800) 422-8800.
17. FURTHER INQUIRIES AND REPORTING. Borrower and Guarantor each authorize Lender and any servicer to obtain business and personal credit reports on Borrower and Guarantor, respectively, at the time of loan application and while any resulting loan is outstanding for any lawful purpose, including, but not limited to, any update, renewal or extension of credit. Upon Borrower's or any Guarantor's request, Lender will advise Borrower or Guarantor if Lender obtained a credit report and Lender will give Borrower or Guarantor the credit bureau's name and address. Lender may report Lender's credit experiences with Borrower to third parties as permitted by law. Lender may also report information about this Loan to credit bureaus. Late payments, missed payments, or other defaults on this Loan may be reflected in information reported to credit bureaus. Borrower may contact the Lender at (800) 422-8800 with any dispute about the accuracy of information Lender plans to, or has, reported to credit bureaus. Borrower is hereby notified that a negative credit report reflecting on Borrower's business credit record may be submitted to a credit reporting agency if Borrower or Guarantor fails to fulfill the terms of this Agreement.
Borrower and Guarantor each agree to provide Lender with such information about the financial condition and operations of Borrower or Guarantor, as Lender may, from time to time, reasonably require. Borrower agrees to provide any required authorization for the Lender to obtain the Borrower's financial information including, but not limited to, tax information, and any information concerning the Borrower's business as the Lender may request. Borrower authorizes Lender to act as Borrower's agent for purposes of accessing and retrieving transaction history information regarding Borrower from Borrower's designated merchant processor(s) if any. Borrower also agrees that Lender may release information to comply with governmental reporting or legal process that Lender believes may be required, whether or not such is in fact required, or when necessary or helpful in completing a transaction, or when investigating a loss or potential loss. Where required by Lender during the loan application process and in servicing the loan, Borrower agrees that Lender, its affiliates or agents may share (i) business information, such as the business's federal tax ID, SIC or NAICS Code and telephone number (ii) loan account information, such as the number of guarantors, account number, account type and collateral type (if any) and (iii) other information with third parties, such as Experian, periodically in connection with the Loan. Lender relies on information from third parties, such as Experian and its clients, in providing the loans. Third parties' clients may use the shared information for any legal purpose in accordance with applicable laws and regulations. Borrower further agrees that Lender, its affiliates or agents are not responsible for the use by third parties or their clients of any such shared information. Without limiting the foregoing, you authorize us to share information about you and information related to your participation in the program as permitted by law.
18. DEFAULT. To the greatest extent not prohibited by applicable law, Borrower will be in default under this Agreement if any of the following happens (herein, each an "Event of Default"): (i) Borrower fails to make any payment under this Agreement or any other agreement with Lender or any affiliate of Lender when due; (ii) Borrower fails to comply with or to perform any term, obligation, covenant or condition under this Agreement; (iii) Borrower is in default under any loan or any other agreement, in favor of any other party to whom Borrower owes a debt; (iv) Borrower changes, without providing Lender with written notice, (a) its name, its ownership, its place of business or, if more than one, chief executive office, or its mailing address or organizational identification number if it has one, or (b) its type of organization, jurisdiction of organization, or other legal structure; (v) Borrower liquidates or dissolves, or enters into any consolidation merger, partnership, joint venture or other combination without our prior written consent; (vi) Borrower sells any assets except in the ordinary course of Borrower's business as now conducted, or sells, leases, assigns, or transfers any substantial part of Borrower's business or fixed assets or any property or other assets necessary for the continuance of Borrower's business as now conducted, including, without limitation, the selling of any property or other assets accompanied by the leasing back of the same; (vii) any guaranty of performance given to Lender ceases to be in full force and effect or is declared to be null and void; or the validity or enforceability thereof is contested in a judicial proceeding; or the Guarantor denies that the Guarantor has any further liability under such guaranty; or Guarantor defaults in any provision of any guaranty, or any financial information provided by Guarantor is false or misleading; (viii) if Borrower is a sole proprietorship, the personal guarantor shown above dies; if Borrower is a trust, a trustor dies; if Borrower is a partnership, any general or managing partner dies; if Borrower is a corporation, any principal officer or 10% or greater shareholder dies; if Borrower is a limited liability company, any managing member dies; if Borrower is any other form of business entity, any person(s) directly or indirectly controlling ten percent (10%) or more of the ownership interests of such entity dies; (ix) Borrower files a petition in bankruptcy under the United States Bankruptcy Code, be adjudicated as bankrupt or insolvent under any federal or state law, or makes an assignment for the benefit of creditors; (x) any representation or statement made by Borrower or on the Borrower's behalf is false or misleading either now or at the time made; or (xi) any of the events described in this default section occurs with respect to the Guarantor.
19. NOTICE OF BORROWER'S DEFAULT. Borrower agrees to furnish to Lender, immediately upon becoming aware of the existence of any condition or event which with the lapse of time or failure to give notice would constitute an Event of Default under this Agreement, written notice specifying the nature and period of the existence of such condition or event and any action which Borrower is taking or proposes to take with respect thereto. Such notice shall comply with the requirements of section 29 below.
20. RIGHTS AND REMEDIES UPON DEFAULT. If an Event of Default occurs, at any time thereafter, Lender may demand the immediate payment of all amounts owed under this Agreement without notice (including notice of nonpayment, notice of intention to accelerate, notice of acceleration, presentment, protest, notice of dishonor and notice of protest) unless required under applicable law and may immediately initiate an ACH debit entry to Borrower's Bank Account in accordance with Section 9 for amounts owed under this Agreement.
21. ATTORNEYS' FEES AND COLLECTION COSTS. To the greatest extent not prohibited by applicable law, Borrower waives all notices and demands and will pay to Lender all expenses, including, but not limited to, collection costs, court costs, attorneys' fees and expenses, and all other expenses of like nature, which may be expended by Lender to obtain or enforce payment under this Agreement as against Borrower or any Guarantor or other surety of Borrower or in the prosecution or defense of any action or concerning any matter arising out of or related to Borrower's Loan or this Agreement.
22. INDEMNIFICATION. Except for Lender's gross negligence or willful misconduct, Borrower and Guarantor will indemnify and hold Lender, its officers, directors, employees, managers, members, agents, and affiliates (Lender Indemnified Parties) harmless from all loss, costs, damage, liability or expenses (including, without limitation, court costs and reasonable attorneys' fees) that the Lender Indemnified Parties may sustain or incur in any action or proceeding concerning any matter arising out of or related to this Agreement and/or any other documents now or hereafter executed in connection with this Agreement. This indemnity will survive the repayment of the Loan and the termination of this Agreement.
23. LIMITATION OF LIABILITY. Except as expressly prohibited by applicable law, Lender will not be liable to you for any indirect, special, incidental, consequential, punitive, or exemplary damages of any kind (including, without limitation, lost revenues, loss of profits, loss of data, or loss of business), whether arising out of breach of contract, tort (including negligence) or otherwise, arising from this Agreement or relating to the obligations hereunder, even if advised of such potential damages.
24. DISPUTES. Most disagreements can be resolved informally and efficiently by contacting our customer support team. If you are a U.S. customer:
a. Dispute Resolution Agreement. BORROWER AND LENDER AGREE THAT, EXCEPT AS PROVIDED BELOW, ANY DISPUTE, CLAIM, OR CONTROVERSY ARISING OUT OF OR RELATING IN ANY WAY TO THIS AGREEMENT OR LENDER AND BORROWER'S DIRECT OR INDIRECT DEALINGS WITH ONE ANOTHER (A CLAIM) WILL BE DETERMINED BY BINDING ARBITRATION OR SMALL CLAIMS COURT, INSTEAD OF IN COURTS OF GENERAL JURISDICTION. The parties agree that this arbitration provision extends to any other parties involved in any Claims, including but not limited to the Guarantor and the parties' respective employees, affiliated companies, and vendors.
b. Small Claims Court. Either Borrower or Lender can seek to have a Claim resolved in small claims court if all the requirements of the small claims court are satisfied. Either Borrower or Lender may seek to have a Claim resolved in small claims court in Borrower's county of address or the small claims court in closest proximity to Borrower's principal place of business.
c. Arbitration. Arbitration is more informal than a lawsuit in court. Arbitration uses a neutral arbitrator instead of a judge or jury, may allow for more limited discovery than in court, and is subject to very limited review by courts. Arbitrators can award the same damages and relief that a court can award. Borrower and Lender agree that the U.S. Federal Arbitration Act governs the interpretation and enforcement of this arbitration provision, and that Borrower and Lender are each waiving the right to a trial by jury or to participate in a class action. This arbitration provision shall survive the termination of this Agreement, Borrower's fulfillment or default of its obligations under this Agreement, and/or Borrower's or Lender's bankruptcy or insolvency (to the extent permitted by applicable law).
d. Notice of Claim. If Borrower or Lender elects to seek arbitration or resolution in small claims court, the party seeking arbitration or small claims court must first send to the other party a written notice of that party's Claim (Notice of Claim). A Notice of Claim to Lender should be sent to Corporation Service Company, 251 Little Falls Drive, Wilmington, DE 19808. The Notice of Claim should include both the mailing address and email address Borrower would like Lender to use to contact Borrower. If Lender elects to seek arbitration, it will send, by certified mail, a written Notice of Claim to Borrower's address on file. A Notice of Claim, whether sent by Borrower or Lender, must (i) describe the nature and basis of the claim or dispute; and (ii) set forth the specific amount and/or nature of damages or other relief sought.
e. Informal Resolution. Borrower and Lender agree that good-faith informal efforts to resolve disputes often can result in a prompt, low-cost, and mutually beneficial outcome. Borrower and Lender therefore agree that, after a Notice of Claim is sent but before either Borrower or Lender commences arbitration or files a Claim in small claims court against the other, Borrower and Lender will personally meet, via telephone or videoconference, in a good-faith effort to confer with each other and try to resolve informally any Claim covered by this Agreement. If Borrower is represented by counsel, Borrower counsel may participate in the conference as well, but Borrower agrees to fully participate in the conference. Likewise, if Lender is represented by counsel, its counsel may participate in the conference as well, but Lender agrees to have a non-lawyer company representative fully participate in the conference. The statute of limitations and any filing fee deadlines shall be tolled while the parties engage in the informal dispute resolution process required by this paragraph.
f. Commencing Arbitration or Small Claims Proceedings. If Borrower and Lender do not reach an agreement to resolve the Claim within sixty (60) days after the Notice of Claim is received, Borrower or Lender may commence an arbitration proceeding by filing a Demand for Arbitration or, alternatively, by filing a Claim in small claims court. Borrower and Lender agree that they may not commence any arbitration or file a Claim in small claims court unless Borrower and Lender are unable to resolve the claim within sixty (60) days after receipt of a completed Notice of Claim and the party seeking arbitration or small claims court has made a good faith effort to resolve the Claim directly with the other party during that time. If a Claim qualifies for small claims court, but a party commences an arbitration proceeding, Borrower and Lender agree that either party may elect instead to have the Claim resolved in small claims court, and upon written notice of a party's election, the American Arbitration Association (AAA) will administratively close the arbitration proceeding. Any dispute about whether a Claim qualifies for small claims court shall be resolved by that court, not by an arbitrator. In the event of any such dispute, the arbitration proceeding shall remain closed unless and until a decision by the small claims court that the Claim should proceed in arbitration. You may download or copy a form of notice and a form to initiate arbitration at www.adr.org or by calling 1-800-778-7879. The arbitration will be conducted by the AAA before a single AAA arbitrator under the AAA's rules, which are available at www.adr.org or by calling 1-800-778-7879, except as modified by this Agreement. Unless Borrower and Lender agree otherwise, any arbitration hearings will take place in the federal judicial district of either your residence or of the mailing address the Business provided in its Notice of Claim.
g. Arbitration Proceedings: Arbitrators. The arbitrator will be either (1) a retired judge or (2) an attorney specifically licensed to practice law in the state of Utah or the state of the Business address and will be selected by the parties from the AAAs National Roster of arbitrators. The arbitrator will be selected using the following procedure: (i) the AAA will send the parties a list of five candidates meeting this criteria; (ii) if the parties cannot agree on an arbitrator from the list, each party shall return its list to the AAA within 10 days, striking up to two candidates, and ranking the remaining candidates in order of preference; (iii) the AAA shall appoint as arbitrator the candidate with the highest aggregate ranking; and (iv) if for any reason the appointment cannot be made according to this procedure, the AAA may exercise its discretion in appointing the arbitrator. The arbitrator is bound by this Agreement. Except as otherwise provided in Section 24(j) below, all issues are for the arbitrator to decide, including issues relating to the scope and enforceability of this arbitration provision.
h. Arbitration Proceedings; Administrative Conference. The parties agree that an administrative conference with the AAA shall be conducted in each arbitration proceeding, and Borrower and a non-lawyer representative of Lender shall appear at the administrative conference via telephone. If Borrower or Lender fails to appear at the administrative conference, regardless of whether its counsel attends, the AAA will enter an order for the party that did not appear to show cause why AAA should not administratively close the arbitration proceeding without prejudice or enter a default award as appropriate.
i. Arbitration Proceedings: Decisions The arbitrator shall issue a reasoned written decision sufficient to explain the essential findings and conclusions on which the award is based. The award shall be binding only among the parties and shall have no preclusive effect in any other arbitration or other proceeding involving a different party. Lender will not seek to recover its attorneys fees and costs in arbitration from Borrower unless the arbitrator finds that either the substance of Borrower's claim or the relief sought in Borrower's Demand for Arbitration was frivolous or was brought for an improper purpose (as measured by the standards set forth in Federal Rule of Civil Procedure 11(b)). Judgment on any award may be entered in any court having jurisdiction. This agreement to arbitrate shall not preclude any party to the arbitration from at any time seeking injunctions or other forms of equitable relief in aid of arbitration from a court of appropriate jurisdiction including whether a Demand for Arbitration is filed in violation of this Agreement.
j. Injunctive and Declaratory Relief. Except as provided in Section 24(b) above, the arbitrator shall determine all issues of liability on the merits of any Claim asserted by Borrower or Lender and may award declaratory or injunctive relief only in favor of the individual party seeking relief and only to the extent necessary to provide relief warranted by that party's individual claim. To the extent that Borrower or Lender prevails on a Claim and seeks public injunctive relief (that is, injunctive relief that has the primary purpose and effect of prohibiting unlawful acts that threaten future injury to the public), the entitlement to and extent of such relief must be litigated in a civil court of competent jurisdiction and not in arbitration. The parties agree that litigation and any issues of public injunctive relief shall be stayed pending the outcome of the merits of any individual claims in arbitration. Before a court of competent jurisdiction issues any public injunctive relief, it shall review the factual findings of the arbitration award on which any injunction would issue with no deference to the arbitrator.
k. Arbitration Fees and Costs. Payment of all filing, administration and arbitrator fees will be governed by the AAA Rules. Borrower is required to pay AAA's initial filing fee, but Lender will reimburse Borrower for this filing fee at the conclusion of the arbitration to the extent it exceeds the fee for filing a complaint in a federal or state court in the Business county of address. If the arbitrator finds that either the substance of Borrower's Claim or the relief sought in Borrower's Demand for Arbitration was frivolous or was brought for an improper purpose (as measured by the standards set forth in Federal Rule of Civil Procedure 11(b)), then the payment of all fees will be governed by the AAA Rules and Lender will not reimburse your initial filing fee. The parties agree that the AAA has discretion to modify the amount or timing of any administrative or arbitration fees due under the AAA Rules where it deems appropriate, provided that such modification does not increase the AAA fees to Borrower or Lender, and Borrower and Lender waive any objection to such fee modification.
l. Class Action Waiver. BORROWER AND LENDER AGREE THAT EACH MAY BRING CLAIMS AGAINST THE OTHER ONLY IN BORROWER OR LENDER'S INDIVIDUAL CAPACITY, AND NOT AS A PLAINTIFF OR CLASS MEMBER IN ANY PURPORTED CLASS OR REPRESENTATIVE PROCEEDING. Further, if a party has elected arbitration, unless both Borrower and Lender agree otherwise, the arbitrator may not consolidate any other person's Claims with the claimant's Claims and may not otherwise preside over any form of a representative or class proceeding. If Borrower or Lender believes that any Claim filed in arbitration or in court is inconsistent with the limitations in this Section 24(l), then such party may seek an order from a court determining whether the Claim is within the scope of the Class Action Waiver. If this Class Action Waiver is found to be unenforceable, then the entirety of this Section 24 (Disputes) shall be null and void. Even if all parties have opted to litigate a Claim in court, Borrower or Lender may elect arbitration with respect to any Claim made by a new party or any new Claims later asserted in that lawsuit.
m. Right to Opt Out: BORROWER HAS THE RIGHT TO REJECT THIS ARBITRATION AGREEMENT, BUT MUST EXERCISE THIS RIGHT PROMPTLY. If Borrower does not wish to be bound by this agreement to arbitrate, Borrower must notify Lender in writing within sixty (60) days after the date Borrower signs this Agreement. Borrower must send its opt-out request by sending a written request to: WebBank c/o QuickBooks Capital, P.O. Box 842978, Dallas, TX 75284-2978, or [email protected]. The request must include Borrower's full name, individual contact person, address, account number, and the statement, "I reject the arbitration provision contained in my QuickBooks Term Loan Agreement". If Borrower exercises the right to reject arbitration, the other terms of this Agreement shall remain in full force and effect as if Borrower had not rejected arbitration.
25. NO WAIVER BY LENDER. No delay on the part of Lender to exercise, and no delay in exercising, any right under this Agreement will operate as a waiver thereof, nor will any single or partial exercise of any right under this Agreement preclude any other or further exercise of any other right. The remedies provided hereunder are cumulative and not exclusive of any remedies provided by law or equity.
26. ASSIGNMENT/ SERVICE PROVIDERS. This Agreement will bind and inure to the benefit of the respective successors and assigns of each party; provided, however, that Borrower may not assign this Agreement or any rights or duties hereunder without Lender's prior written consent and any prohibited assignment is absolutely void. No consent to an assignment by Lender will release Borrower from its obligations under this Agreement. Subject to any applicable requirements of law, Lender may assign this Agreement and its rights and duties hereunder and no prior notice to, consent or approval by, Borrower is required in connection with any such assignment, including any sale or transfer of Loans or interests therein. In connection with any assignment, Lender may disclose all documents and information that Lender now or hereafter may have relating to Borrower or Borrower's business. To the extent that Lender assigns its rights and obligations hereunder to another party, Lender thereafter is released from such assigned obligations to Borrower. Lender reserves the right to use any third party to provide services to Borrower under this Agreement, including the right to enforce its rights hereunder, without notice to or consent from the Borrower.
27. SEVERABILITY. In case any one or more of the provisions contained in this Agreement should be determined to be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein will not in any way be affected or impaired thereby to the greatest extent consistent with the stated intent of the parties.
28. TERMINATION. Lender shall have the right to terminate this Agreement in its sole discretion, and at any time, effective immediately upon providing notice to Borrower. If Lender exercises its right to terminate the Agreement, Borrower shall remain liable for all amounts owed under the Agreement, including without limitation any QuickBooks Term Loan that is then outstanding.
29. NOTICES. Except as otherwise provided in this Agreement, any notice provided under this Agreement must be in writing but may be provided electronically. Notices will be deemed given when properly addressed and deposited in the U.S. mail, postage prepaid, First Class mail, delivered in person, or sent by registered mail, by certified mail, by nationally recognized overnight courier, or by electronic mail. Notice to Borrower or any Guarantor will be sent to the last known physical address or electronic mail address in Lender's records for Borrower or any Guarantor. Notice to the Borrower or any Guarantor will be deemed notice to all. Notice to Lender may be sent to: WebBank c/o QuickBooks Capital, P.O. Box 842978, Dallas, TX 75284-2978, or [email protected]
30. CHANGE IN CONTACT INFORMATION. Borrower or any Guarantor agrees to notify Lender immediately if the following information changes: name, postal or electronic mail address or other contact information.
31. ERRORS. Borrower will notify the Lender immediately if there are any errors in the information regarding Borrower's account or information that Borrower provides to Lender.
32. GOVERNING LAW. Except for the Arbitration Agreement in Section 24 which is governed by the FAA, this Agreement is governed by and will be construed in accordance with, applicable federal law and (to the extent state law applies) the laws of the state of Utah without regard to its conflict of laws provisions.
33. ELECTRONIC DISCLOSURES. Borrower and Guarantor each agree to receive this Agreement, and any disclosure, notice and communication and subsequent disclosures, notices and communications (collectively, "Disclosures") that are required by law to be provided in writing at any email address provided to us. Lender will also provide electronic copies of Disclosures online. Borrower and Guarantor acknowledge that Borrower and such Guarantor are able to print or otherwise retain electronic disclosures. Borrower and Guarantor each agree to provide Lender with the Borrower's and such Guarantor's current e-mail address for notices. If the e-mail address changes, Borrower and Guarantor must send Lender notice of the new address by writing to Lender at least three (3) days before the effective date of the change to WebBank c/o QuickBooks Capital, P.O. Box 842978, Dallas, TX 75284- 2978, or by calling (800) 422-8800.
34. ELECTRONIC COMMUNICATIONS. Borrower and any Guarantor agree that Lender and any servicer may contact Borrower or any Guarantor as provided in this paragraph. Lender and any servicer may contact Borrower and any Guarantor for any lawful reason, including for the collection of amounts owed to Lender. No such contact will be deemed unsolicited. Borrower and any Guarantor specifically agree that Lender or any servicer may (i) contact Borrower or such Guarantor at any address (including email) or telephone number (including wireless cellular telephone, ported landline or VoIP telephone number) as may be provided to Lender from time to time or that Lender is able to determine belongs to Borrower or such Guarantor; (ii) use any means of communication, including, but not limited to, postal mail, electronic mail, telephone or other technology, to reach Borrower or such Guarantor; (iii) use automatic dialing and announcing devices which may play recorded messages; and (iv) send text messages to the Borrower's or Guarantor's telephone. Borrower and Guarantor may incur charges from the company that provides telecommunications, wireless and/or internet services. Borrower and Guarantor each agree that Lender has no liability for such charges. Borrower or Guarantor may withdraw this express consent at any time by contacting Lender at WebBank c/o QuickBooks Capital, P.O. Box 842978, Dallas, TX 75284-2978, or by calling (800) 422-8800, and telling Lender or any servicer specifically what address or telephone number not to use.
35. MONITORING AND RECORDING. In order to ensure quality service, Lender or any servicer may monitor and/or record telephone calls involving the Borrower or any Guarantor. Borrower or any Guarantor acknowledges that Lender and any servicer may do so and agrees in advance to any such monitoring or recording of telephone calls.
36. ENTIRE AGREEMENT. Any application or information that Borrower submitted to Lender in connection with the Loan, and any other documents required by Lender now or in the future in connection with this Agreement, including any attached or referenced exhibits or schedules, are hereby incorporated into and made a part of this Agreement. This Agreement contains the entire agreement and understanding among the parties and supersedes all prior agreements and understandings, whether oral or in writing, relating to the subject matter hereof unless otherwise specifically reaffirmed or restated herein.
37. MODIFICATIONS; AMENDMENTS; CONSTRUCTION. No modification, amendment or waiver of any provision of this Agreement will be effective unless the same is in writing and signed by the parties affected. The headings of the sections and subsections herein are inserted for convenience only and under no circumstances will they affect in any way the meaning or interpretation of this Agreement.
38. COUNTERPARTS. This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original, and all such counterparts shall constitute one and the same instrument.
39. CERTIFICATION AND SIGNATURES. Borrower certifies that Borrower has received a copy of this Agreement and that Borrower has read, understood and agreed to be bound by its terms. Borrower will provide a copy of this Agreement to each Guarantor, if any. The person signing this Agreement certifies that s/he is signing on behalf of the Borrower and that such signer is authorized to execute this Agreement on behalf of Borrower. Borrower intends to authenticate this writing, agrees to all its terms, and electronically signs this Agreement with the same force and effect as a manual signature. The electronic record of the Borrower's electronic signature, if any, is hereby made a part of this Agreement.
40. PERSONAL GUARANTY. Each Guarantor jointly and severally (if more than one), absolutely and unconditionally guarantees the prompt payment to Lender, including its successors and assignees, of any and all amounts owed by the Borrower pursuant to the Agreement. Each Guarantor further agrees to repay the amount owed under this Agreement on demand, without requiring Lender first to enforce payment against Borrower and that separate action may be brought against each Guarantor without proceeding against the Borrower. Each Guarantor is jointly and severally liable with the Borrower for the payments due under this Agreement. This is a guarantee of payment and not of collection. This is an absolute, unconditional, primary, and continuing obligation (irrespective of (a) any lack of validity, regularity, or enforceability of this Agreement, (b) any circumstances that might constitute a legal or equitable discharge of the Guarantor, and (c) any other circumstances which might otherwise constitute a defense available to, or a discharge of the Borrower until full payment of the guaranteed obligations is made. This guaranty will remain in full force and effect until the first to occur of the following: (i) all amounts owed under this Agreement are paid in full and Lender has terminated this Personal Guaranty, or (ii) 30 days after the date on which written notice of revocation is actually received and accepted by Lender. No revocation will affect the then existing liabilities of the revoking Guarantor under this Personal Guaranty. Lender may report information about this Loan and the Guarantor to credit bureaus. Late payments, missed payments, or other defaults on this Loan may be reflected in the Guarantor's personal credit report. Guarantors may contact Lender's service provider at (800) 422 -8800 with any dispute about the accuracy of information Lender plans to, or has, reported to credit bureaus. Guarantor is hereby notified that a negative credit report reflecting on Guarantor's personal credit record may be submitted to a credit reporting agency if Guarantor fails to fulfill the terms of this Agreement. The Guarantor has the power and authority and the legal right to execute, deliver and perform this Personal Guaranty and has taken all necessary action to authorize the execution, delivery and performance of this Personal Guaranty; (b) Guarantor has reviewed and approved the Agreement; (c) Guarantor has carefully read this Personal Guaranty and has, or has had a reasonable opportunity to, consulted with its attorney; and (d) Guarantor understands the contents of this Personal Guaranty and signs this Personal Guaranty as its free act and deed. Each Guarantor waives all notices to which the Guarantor might otherwise be entitled by law, and also waives all defenses, legal or equitable, otherwise available to the Guarantor. The Guarantor authorizes the Lender (whether or not after termination of this Personal Guaranty), without notice or demand (except as shall be required by applicable statute which cannot be waived), and without affecting or impairing its liability hereunder, from time to time to (a) renew, compromise, extend, increase, accelerate or otherwise change the time for payment of, or otherwise change the terms of, the guaranteed obligations or any part thereof, including increase or decrease of the rate of interest thereon; (b) exercise or refrain from exercising any rights against the Borrower or others or otherwise refrain from acting; and (c) consent to or waive any breach of, or any act, omission or default under, the Agreement. If the Borrower avoids any payments due under the Agreement as a result of insolvency or dissolution, the Guarantor's obligations shall continue as if the payment had not been avoided and Lender shall be entitled to recover the amount from such Guarantor. This Personal Guaranty will be construed in accordance with the laws of Utah and will inure to the benefit of Lender, its successors and assigns. To the greatest extent not prohibited by applicable law, the Guarantor waives its right to a trial by jury of any claim or cause of action based upon, arising out of or related to this Personal Guaranty and the Agreement, in any legal action or proceeding. Any such claim or cause of action will be tried by a court sitting without a jury. Guarantor intends to authenticate this writing, agrees to all its terms and electronically signs this Agreement and Personal Guaranty with the same force and effect as a manual signature. The Guarantor agrees to be bound by the terms of this Agreement. Guarantor agrees to indemnify Lender against all loss occasioned by, or arising from, any legal limitation, disability or lack of capacity or authority of, or affecting, the Borrower or any person acting or purporting to act on behalf of the Borrower, regarding these guaranty obligations. The electronic record of the Guarantor's electronic signature, if any, is hereby made a part of this Agreement. BORROWER'S SIGNATURE: By clicking "Accept and submit" or other similarly marked button on the Term Loan website indicating acceptance of and agreement to the loan documents, Borrower agrees to be bound by the terms of this Agreement.
Application complete date: 2025-11-23 16:23:09 PST
Electronic signature executed: 2025-11-23 16:36:54 PST
Offer accepted: 2025-11-23 16:36:54 PST