Convertible Note Purchase Agreement [conformed for Consent and Amendment dated as of November 14, 2024]
EXHIBIT B
CONVERTIBLE NOTE PURCHASE AGREEMENT, DATED AS OF JUNE 21, 2023, BETWEEN SURF AIR MOBILITY INC. AND PARTNERS FOR GROWTH V, L.P.
Partners for Growth
Convertible Note Purchase Agreement
[conformed for Consent and Amendment dated as of November 14, 2024]
Borrower: |
Surf Air Mobility Inc., a Delaware corporation |
Address: |
00000 X. Xxxxxxxx Xxxxxxxxx, Xxxxxxxxx, XX 00000 |
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Date: |
June 21, 2023 |
This CONVERTIBLE NOTE PURCHASE AGREEMENT (this “Agreement”) is entered into as of the date specified above between PARTNERS FOR GROWTH V, L.P. (“PFG”), whose address is 0000 Xxxxxxx Xxxx., Xxxxxxx, XX 00000, and the Borrower named above (“Borrower” or “Company”), whose principal office is located at the above address (“Borrower’s Address”). The Schedule to this Agreement (the “Schedule”) being signed by the parties concurrently, is an integral part of this Agreement. (Definitions of certain terms used in this Agreement are set forth in Section 7 below.)
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“Account Debtor” means the obligor on an account receivable.
“Affiliate” means, with respect to any Person, a relative, partner, shareholder, director, officer, or employee of such Person, or any parent or Subsidiary of such Person, or any Person directly or indirectly through any other Person controlling, controlled by or under common control with such Person.
“Billing Period” means monthly, unless another period or date for payment is specified under this Agreement (such as the Maturity Date), or (ii) such other period as PFG as may result from monetary Obligations not being outstanding during the entire period for which interest is being calculated (such as partial months if the Effective Date is not the first day of a calendar month), or (iii) such other period as PFG may notify in writing to Borrower, or (iv) in the case of interest payments hereunder, each Interest Period. For the avoidance of doubt, under this Agreement, a “month” consists of 31 days in each January, March, May, July, August, October and December, 30 days in each other month except February, which consists of 28 days or, in a leap year, 29 days.
“Board” means the Board of Directors or other governing authority of any Obligor as authorized in its Constitutional Documents (which for the avoidance of doubt, includes a member or manager of a limited liability company).
“Borrower” means the entity identified on the first page of this Agreement and any other Person who may from time to time be joined as a borrower under this Agreement; a reference to “Borrower” means “each Borrower”.
“Business Day” or “business day” means any weekday on which banks in California are generally open for business.
“BVI” means the British Virgin Islands.
“Change in Control” means any event, transaction, or occurrence as a result of which any “person” (as such term is defined in Sections 3(a)(9) and 13(d)(3) of the Exchange Act, other than a trustee or other fiduciary holding securities under an employee benefit plan of Borrower, is or becomes a beneficial owner (within the meaning Rule 13d-3 promulgated under the Exchange Act), directly or indirectly, of securities of Borrower, representing fifty percent
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(50%) or more of the combined voting power of Borrower’s then outstanding securities in a single transaction or a series of related transactions (other than by the sale of Borrower’s equity securities in a public offering or to venture capital or private equity investors so long as Borrower identifies to PFG the venture capital or private equity investors at least seven (7) Business Days prior to the initial closing of the transaction and provides to PFG a description of the material terms of the transaction and such other information as PFG may reasonably request).
“Code” means the Uniform Commercial Code as adopted and in effect in the State of California from time to time.
“Commission” means the U.S. Securities and Exchange Commission or any successor entity.
“Commission Documents” shall mean, as of a particular date, all reports, schedules, forms, statements and other documents filed by the Company with the Commission pursuant to the reporting requirements of the Exchange Act, including material filed pursuant to Section 13(a) or 15(d) of the Exchange Act, the Registration Statement, and shall include all information contained in such filings and all filings incorporated by reference therein.
“Commodity Account” is any “commodity account” as defined in the Code with such additions to such term as may hereafter be made.
“Consent and Amendment” means that certain Consent and Amendment, dated as of the Consent and Amendment Effective Date, among PFG, the Borrower and the Initial Guarantors.
“Consent and Amendment Effective Date” means November 14, 2024.
“Constitutional Document” means for any Person, such Person’s incorporation documents, as last certified by the Secretary of State (or equivalent Governmental Body) of such Person’s jurisdiction of organization, if applicable, together with, (a) if such Person is a corporation, its bylaws in current form, (b) if such Person is a limited liability company, its certificate of incorporation, articles of association and/or limited liability company agreement (or operating or similar agreement), (c) if such Person is a partnership, its partnership agreement (or similar agreement), and (d) if such Person is a statutory joint venture company or similar entity, its joint venture (or similar) agreement, each of the foregoing with all current amendments or modifications thereto.
“Contingent Obligation” is, for any Person, any direct or indirect liability, contingent or not, of that Person for (a) any indebtedness, lease, Dividend, letter of credit or other obligation of another such as an obligation, in each case directly or indirectly guaranteed, endorsed, co made, discounted or sold with recourse by that Person, or for which that Person is directly or indirectly liable; (b) any obligations for undrawn letters of credit for the account of that Person; and (c) all obligations from any interest rate, currency or commodity swap agreement, interest rate cap or collar agreement, or other agreement or arrangement designated to protect a Person against fluctuation in interest rates, currency exchange rates or commodity prices; but “Contingent Obligation” does not include endorsements in the ordinary course of business. The amount of a Contingent Obligation is the stated or determined amount of the primary obligation for which the Contingent Obligation is made or, if not determinable, the maximum reasonably anticipated liability for it determined by the Person in good faith; but the amount may not exceed the maximum of the obligations under any guarantee or other support arrangement.
“continuing” and “during the continuance of” when used with reference to a Default or Event of Default means that the Default or Event of Default has occurred and has not been either waived in writing by PFG or cured within any applicable cure period.
“Conversion Right” means PFG’s right to convert its Promissory Note into ordinary shares of the Group Parent as set forth Section 1 of the Schedule.
“Default” means any event which with notice or passage of time or both, would constitute an Event of Default.
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“Default Rate” means the lesser of (i) the applicable rate(s) set forth in the Schedule, plus six percent (6%) per annum, and (ii) the maximum rate of interest that may lawfully be charged to a commercial borrower under applicable usury laws.
“Deposit Accounts” means all present and future “deposit accounts” as defined in the Code in effect on the Effective Date in the name of the Borrower or any Guarantor, with such additions to such term as may hereafter be made, and includes without limitation all general and special bank accounts, demand accounts, checking accounts, savings accounts and certificates of deposit, and as used in this Agreement, the term “Deposit Accounts” shall be construed to also include securities, commodities and other Investment Property accounts.
“Dividend” means a payment or other distribution in respect of an equity interest to an owner thereof, (A) whether or not (i) in respect of net profits, revenues or otherwise, (ii) declared by Borrower’s (or other relevant party’s) Board, (iii) previously paid, or (iv) authorized in its Constitutional Documents or otherwise, and (B) for the avoidance of doubt, including distributions to members of a limited liability company.
“Due Date” in relation to monetary Obligations payable from time to time by Borrower means (i) the date for payment specified in this Agreement (such as, on the first day of each calendar month for interest accrued during the prior month, as contemplated in Section 1.2) or in any other writing executed and delivered by PFG and Borrower from time to time, whether such payment is recurring, one-time or otherwise, or (ii) in the case of Obligations for which no date for payment is specified in this Agreement and which cannot be reasonably ascertained without an invoice from PFG, such as reimbursement of PFG Expenses, the date for payment specified in an invoice sent by or on behalf of PFG to Borrower, which date shall not be less than five (5) Business Days from delivery by electronic means.
“Effective Date” means June 21, 2023.
“Event of Default” means any of the events set forth in Section 6.1 of this Agreement.
“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission thereunder.
“Excluded Taxes” means any of the following Taxes imposed on or with respect to a recipient or required to be withheld or deducted from a payment to a recipient: (a) Taxes imposed on or measured by such recipient’s net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such recipient being organized under the laws of, or having its principal office or, in the case of any investor, its applicable lending office located in, the jurisdiction imposing such Tax or (ii) that are Other Connection Taxes, (b) in the case of a investor, any U.S. federal withholding Taxes imposed pursuant to a law in effect on the date on which such investor becomes a party hereto or changes its lending office, except in each case to the extent that, pursuant to Section 8.21, additional amounts with respect to such Taxes were payable either to such investor’s assignor immediately before such investor became a party hereto or to such investor immediately before it changes its lending office, (c) Taxes attributable to such recipient’s failure to comply with Section 8.21 and (d) any Taxes imposed under FATCA.
“FATCA” means Sections 1471 through 1474 of the Internal Revenue Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official administrative interpretations thereof, any agreements entered into pursuant to current Section 1471(b)(1) of the Internal Revenue Code (or any amended or successor version described above) and any intergovernmental agreements implementing the foregoing (together with any laws implementing such agreements).
“Financial Statements” means financial statements of each of Group Parent, and it Subsidiaries including a balance sheet, income statement and cash flow and, in the case of monthly-required financial statements, showing data for the month being reported and a history showing each month from the beginning of the relevant fiscal year, together with any financial statements that have been prepared or are requested by PFG with respect to Group Members not within a consolidated financial statement of any of the foregoing.
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“GAAP” means generally accepted accounting principles consistently applied.
“GEM Equity Purchase Facility” means the obligation of the GEM Purchasers to purchase equity of Surf Air Global Ltd. in an amount up to $400,000,000, subject to the terms and conditions set forth in the GEM Share Purchase Agreement.
“GEM Listing Day Purchase Agreement” means that certain Share Purchase Agreement by and among Group Parent and the GEM Purchasers dated as of June 15, 2023 pursuant to which GEM will purchase 1,000,000 shares of Common Stock for a purchase price of $25,000,000.
“GEM Share Purchase Agreement” means that certain Second Amended and Restated Share Purchase Agreement, dated February 8, 2023 by and among, Surf Air Global Ltd., GEM Global Yield LLC SCS and GEM Yield Bahamas Limited (collectively, the “GEM Purchasers”), as in effect on the date hereof.
“good faith business judgment” means honesty in fact and good faith (as defined in Section 1201 of the Code) in the exercise of PFG’s business judgment.
“Governmental Authorization” means any: (a) permit, license, certificate, franchise, concession, approval, consent, ratification, permission, clearance, confirmation, endorsement, waiver, certification, designation, rating, registration, qualification or authorization that is, has been issued, granted, given or otherwise made available by or under the authority of any Governmental Body or pursuant to any Legal Requirement; or (b) right under any contract with any Governmental Body.
“Governmental Body” means any: (a) nation, principality, commonwealth, province, territory, county, municipality, district or other jurisdiction of any nature; (b) local, municipal, foreign or other government; (c) governmental or quasi-governmental authority of any nature (including any governmental division, subdivision, department, agency, bureau, branch, office, commission, council, board, instrumentality, officer, official, representative, organization, unit, body or entity and any court or other tribunal); (d) multi-national organization or body; or (e) individual, entity or body exercising, or entitled to exercise, any executive, legislative, judicial, administrative, regulatory, police, military or taxing authority or power of any nature.
“Group” means Borrower, each Guarantor, the direct or indirect Subsidiaries and controlled Affiliates of Guarantor or Borrower, and “Group Member” means any of such foregoing Persons.
“Group Parent” means Surf Air Mobility Inc., a Delaware corporation.
“Guarantor” means the Initial Guarantors and any Additional Guarantors.
“Guaranty” means the guaranty provisions of Section 10.
“including” means including (but not limited to).
“Indebtedness” means (a) indebtedness for borrowed money or the deferred purchase price of property or services (other than trade payables arising in the ordinary course of business), (b) obligations evidenced by bonds, notes, debentures or other similar instruments, (c) reimbursement obligations in connection with letters of credit, (d) capital lease obligations and (e) Contingent Obligations in respect of Indebtedness under clauses (a) through (c).
“Insolvency Proceeding” means (a) any proceeding by or against any Person under the United States Bankruptcy Code, or any other bankruptcy or insolvency law in any jurisdiction, including winding-up procedures, assignments for the benefit of creditors, compositions, receiverships, administrations, extensions generally with its creditors, or proceedings seeking reorganization, arrangement or other relief; or (b) if any step is taken with a view to a moratorium or a composition, assignment or similar arrangement with any of a Person’s creditors; (c) if a meeting of a Person’s shareholders, directors or other officers is convened for the purpose of considering any resolution for, to petition for or to make an application to or to file documents with a court or any registrar for, such Person’s winding-up, administration or dissolution or any such resolution is passed; or (d) if an order is made for a Person’s
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winding-up, administration or dissolution, or any Person presents a petition, or makes an application to or files documents with a court or any registrar, for such Person’s winding-up, administration or dissolution, or gives notice to PFG of an intention to appoint an administrator; or (e) if any liquidator, receiver, administrative receiver, administrator or similar officer is appointed in respect of a Person or any of such Person’s assets; or (f) if a Person’s shareholders, directors or other officers request the appointment of, or give notice of their intention to appoint, a liquidator, receiver, administrator or similar officer.
“Internal Revenue Code” means the Internal Revenue Code of 1986, as amended.
“Investment Property” means all present and future investment property, securities, stocks, bonds, debentures, debt securities, partnership interests, limited liability company interests, options, security entitlements, securities accounts, commodity contracts, commodity accounts, and all financial assets held in any securities account or otherwise, and all options and warrants to purchase any of the foregoing, wherever located, and all other securities of every kind, whether certificated or uncertificated.
“LamVen Note” means that certain Senior Secured Promissory Note, dated as of November 14, 2024, by the Company in favor of LamVen LLC, as amended, restated, modified, replaced, refinanced, substituted or supplemented from time to time.
“Legal Requirement” means any written local, municipal, foreign or other law, statute, legislation, constitution, principle of common law, resolution, ordinance, code, edict, decree, proclamation, treaty, convention, rule, regulation, ruling, directive, pronouncement, requirement, specification, determination, decision, opinion or interpretation that is, has been issued, enacted, adopted, passed, approved, promulgated, made, implemented or otherwise put into effect by or under the authority of any Governmental Body.
“Lien” or “lien” is a security interest, claim, mortgage, deed of trust, levy, charge, pledge or other encumbrance of any kind, whether voluntarily incurred or arising by operation of law or otherwise against any property.
“Material Adverse Change” means any of the following: (i) a material adverse change in the business, operations, or financial or other condition of the Obligors taken as a whole, or (ii) a material impairment of the reasonable ability of the Obligors to repay the Obligations as they fall due.
“Maturity Date” means the relevant Maturity Date set forth in Section 4 of the Schedule.
“New Financing” means, collectively, any third-party debt financing obtained by the Borrower or any Guarantor, or any subsidiary thereof, on or after the Consent and Amendment Effective Date and designated in writing by the Borrower to PFG as “New Financing” hereunder, in each case as amended, restated, modified, replaced, refinanced, substituted or supplemented from time to time.
“New LC Reimbursement Agreement” means, collectively, any reimbursement agreement (or similar agreement) among the Borrower or any Guarantor, or any subsidiary thereof, and any provider of direct or indirect credit support for any New Financing (including, by way of example and without limitation, any party that obtains, directly or indirectly, a letter of credit or bank guaranty to provide credit support to the provider(s) of any such New Financing).
“Note Documents” means, collectively, this Agreement, the Promissory Note, and all other present and future documents, instruments and agreements between or among PFG, Borrower, and/or any Guarantor including, but not limited to those relating to this Agreement, and all amendments and modifications thereto and replacements therefor.
“Obligations” means all present PFG Investment and future investments, loans, advances, debts, liabilities, obligations, guaranties, covenants, duties and indebtedness at any time owing by Borrower to PFG, including obligations and covenants intended to survive the termination of this Agreement, whether evidenced by this Agreement or any note or other instrument or document related hereto, including obligations otherwise arising from any extension of credit, opening of a letter of credit, banker’s acceptance, loan, guaranty, indemnification or otherwise,
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whether direct or indirect (including, without limitation, those acquired by assignment and any participation by PFG in any Obligor’s debts owing to others), absolute or contingent, due or to become due, including, without limitation, all interest, charges, expenses, fees, attorney’s fees, expert witness fees, audit fees, collateral monitoring fees, closing fees, facility fees, commitment fees, contingent fees, back-end and performance-based fees, termination fees, minimum interest charges and any other sums chargeable to any Obligor under this Agreement or under any other Note Documents, provided for purposes of the termination of this Agreement under Section 5.3 (or repayment in full at the Maturity Date).
“Obligor” means Borrower and any Guarantor.
“Ordinary (or “ordinary”) course of business” and derivatives shall apply to an action taken or an action required to be taken and not taken by or on behalf of a Borrower. An action will not be deemed to have been taken in the “ordinary course of business” unless: (a) such action is consistent with its past practices (if such type of action has been taken in the past and, if not, such action shall be deemed not in the ordinary course of business) and is similar in nature and magnitude to actions customarily taken by it; (b) such action is taken in accordance with sound and prudent business practices in its jurisdiction of organization; and (c) such action is not required to be authorized by its shareholders and does not require any other separate or special authorization of any nature.
“Other Connection Taxes” means, with respect to any recipient, Taxes imposed as a result of a present or former connection between such recipient and the jurisdiction imposing such Tax (other than connections arising from such recipient having executed, delivered, become a party to, performed its obligations under, or received payments under this Agreement).
“Other Property” means the following as defined in the Code in effect on the Effective Date with such additions to such terms as may hereafter be made, and all rights relating thereto: all present and future “commercial tort claims” (including without limitation any commercial tort claims identified to PFG in writing), “documents”, “instruments”, “promissory notes”, “chattel paper”, “letters of credit”, “letter-of-credit rights”, “fixtures”, “farm products” and “money”; and all other goods and personal property of every kind, tangible and intangible, whether or not governed by the Code, provided that in no event shall Other Property be deemed to include any aircraft subleased by any Obligor.
“Payment” means all checks, wire transfers and other items of payment received by PFG for credit to Borrower’s outstanding Obligations.
“Person” means any individual, sole proprietorship, partnership, joint venture, trust, unincorporated organization, association, corporation, government, or any agency or political division thereof, or any other entity.
“PFG Expenses” means, in each case without limitation as to type and kind: reasonable Professional Costs, and all filing, recording, search, title insurance, appraisal, audit, and other reasonable costs incurred by PFG, pursuant to, or in connection with, or relating to this Agreement (whether or not a lawsuit is filed), including, but not limited to, Professional Costs PFG pays or incurs in order to do the following: (i) prepare and negotiate this Agreement and all present and future documents relating to this Agreement; (ii) obtain legal advice in connection with this Agreement or Borrower; enforce, or seek to enforce, any of its rights or retain the services of consultants to do so; (iii) prosecute actions against, or defend actions by, Account Debtors; (iv) commence, intervene in, or defend any action or proceeding; (v) initiate any complaint to be relieved of the automatic stay in bankruptcy; (vi) file or prosecute any probate claim, bankruptcy claim, third-party claim, or other claim; (vii) examine, audit, copy, any of Borrower’s books and records, subject to Section 4.5; (viii) [reserved]; and (ix) otherwise represent PFG in any litigation relating to Borrower.
“PFG Investment” has the meaning set forth in Section 1.1 to the Schedule hereto.
“PFG Warrants” means those certain warrants to purchase stock, issued by Surf Air Global Limited, to PFG or its affiliates from time to time prior to the date hereof.
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“Principal Market” shall mean the U.S. national securities exchange on which the Common Shares are, or will be, traded.
“Professional Costs” means all reasonable fees and expenses of auditors, accountants, valuation experts, restructuring and other advisory services in connection with restructurings, workouts and Insolvency Proceedings, and reasonable fees and costs of attorneys.
“Public Listing” shall mean the public listing of Common Shares for trading on the Principal Market.
“Registration Statement” shall mean the registration statement on Form S-1 and Form S-4 under the Securities Act to be filed by the Group Parent with the Commission with respect to the registration of Common Shares, in advance of the Public Listing.
“Responsible Officer(s)” means Xxxxxx Xxxxx, Xxxxxx Xxxxxx, Xxxxxxx Xxxxxxxx and any other person authorized to bind Xxxxxxxx and notified to PFG in writing by a Responsible Officer as a new Responsible Officer.
“SAFE Note” means that certain Simple Agreement For Future Equity (SAFE), made on May 17, 2022, in favor of Partners for Growth V, L.P. for an issue price of $15,156,438.24.
“Securities Account” is any “securities account” as defined in the Code with such additions to such term as may hereafter be made.
“Senior Priority Debt” means any debt for borrowed money of Borrower to which the Obligations hereunder have been subordinated in right of payment by an agreement binding on PFG.
“Subsidiary” means, with respect to any Person, (i) any Person of which more than 50% of the voting stock or other equity interests is owned or (ii) a Person controlled, directly or indirectly, by such Person or one or more Subsidiary of such Person and which, for the avoidance of doubt, shall include a “sister” company to a Person under common direct or indirect ownership meeting the above specified percentage for being considered a “Subsidiary” or (iii) a subsidiary as defined in Section 1159 of the UK Companies Act 2006 or (iv) unless the context otherwise requires, a subsidiary undertaking within the meaning of Section 1162 of the UK Companies Act 2006.
“Tax” means any tax (including any income tax, franchise tax, capital gains tax, estimated tax, gross receipts tax, value- added tax, surtax, excise tax, ad valorem tax, transfer tax, stamp tax, sales tax, use tax, property tax, business tax, occupation tax, inventory tax, occupancy tax, withholding tax or payroll tax), levy, assessment, tariff, impost, imposition, toll, duty (including any customs duty), deficiency or fee, and any related charge or amount (including any fine, penalty or interest), that is, has been or may in the future be (a) imposed, assessed or collected by or under the authority of any Governmental Body, or (b) payable pursuant to any tax-sharing agreement or similar contract.
“Transfer” or “transfer” shall include any sale, assignment with or without consideration, encumbrance, hypothecation, pledge, or other transfer or disposition of any kind, including, but not limited to, transfers to receivers, levying creditors, trustees or receivers in bankruptcy proceedings or general assignees for the benefit of creditors, whether voluntary or by operation of law, directly or indirectly.
“$” means United States dollars.
Other Terms. All accounting terms used in this Agreement, unless otherwise indicated, shall have the meanings given to such terms in accordance with GAAP, consistently applied. All other terms contained in this Agreement, unless otherwise indicated, shall have the meanings provided by the Code, to the extent such terms are defined therein.
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THIS NOTE AND THE SECURITIES ISSUABLE UPON THE CONVERSION HEREOF HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR UNLESS SOLD IN ACCORDANCE WITH RULE 144 UNDER SUCH ACT.
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[Signature Pages Follow]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed on the date first written above.
PFG: |
BORROWER: |
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PARTNERS FOR GROWTH V, L.P. |
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By: Partners for Growth V, LLC, Its General Partner |
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By: |
/s/ Xxxxxx Xxxx |
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By: |
/s/ |
Name: |
Xxxxxx Xxxx |
Name: |
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Title: |
Manager |
Title: |
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Partners For Growth
Schedule to
Convertible Note Purchase Agreement
Borrower: |
Surf Air Mobility Inc., a Delaware corporation |
Address: |
00000 X. Xxxxxxxx Xxxxxxxxx, Xxxxxxxxx, XX 00000 |
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Date: |
June 21, 2023 |
This Schedule forms an integral part of the Convertible Note Purchase Agreement between PARTNERS FOR GROWTH V, L.P. and the above-referenced Borrower dated the date hereof.
1. PFG INVESTMENT (Section 1.1):
PFG Investment: |
Subject to the terms and conditions set forth in this Agreement and the other Note Documents, within two Business Day after the conditions set forth in Section 9 of this Schedule have been satisfied, waived in writing by PFG or deferred as a condition subsequent by PFG, each in its sole discretion, Borrower shall borrow from PFG, and PFG shall invest in Borrower, the aggregate principal sum of Eight Million and 00/100 Dollars ($8,000,000.00) (the “PFG Investment”). Such indebtedness shall be evidenced by, and repaid according to, the terms of a secured convertible promissory note (the “Promissory Note”), substantially in the form attached hereto as Exhibit A. The PFG Investment shall be made by wire transfer of immediately available funds to an account owned by Borrower, specified by Borrower at least one Business Day prior to the date hereof. |
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Principal payments on the PFG Investment may not be reborrowed. The entire unpaid principal amount of the PFG Investment shall be due and payable on the Maturity Date together with any and all accrued and unpaid interest thereon (unless earlier converted pursuant to the terms of this Agreement or the Promissory Note. Prepayments of principal shall be permitted at any time in whole or in part, shall not be subject to any penalty or premium, and shall be accompanied by all accrued and unpaid interest thereon. |
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Accrued interest on the PFG Investment shall be paid monthly as provided in Section 1.2 of this Agreement. |
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Note Conversion: |
Any date on or after the date hereof and through the later of (i) the Maturity Date or (ii) the date that the Obligations hereunder are repaid in full, PFG, at its sole desertion, shall have the right (but not the obligation), at any time, to convert the Promissory Note into Common Stock at a conversion price equal to (x) the principal amount of the PFG Investment plus any accrued and unpaid interest thereon, divided by (y) the amount that is one-hundred and twenty percent (120%) of the initial listing price of the Common Stock, per share, immediately after the opening trade on the date of completion of the Group Parent’s public listing on New York Stock Exchange (collectively, the “Conversion Shares”). |
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Upon conversion, Group Parent shall issue in the name of PFG or its Affiliate, a certificate, certificates or other evidence of the Conversion Shares to which PFG is entitled upon such conversion and such certificate(s) (or other evidence of issuance satisfactory to PFG) shall be promptly delivered to PFG. |
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Group Parent shall reserve and keep available out its authorized but not unissued share capital such number of Conversion Shares as shall from time to time be sufficient to effect conversion of the Promissory Note. Group Parent will not, by amendment of its charter documents, shareholders or other agreements with investors or through any reorganization, recapitalization, transfer of assets, consolidation, merger, dissolution, issue or sale of |
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securities, dividend or other distribution of cash or property, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by Group Parent but will at all times in good faith assist in the carrying out of all the provisions hereof, and in the taking of all such action as may be necessary or appropriate in order to protect the conversion rights of PFG as set forth herein against impairment. |
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Upon conversion of the Promissory Note, (a) the Group Parent shall have no further obligations under the Promissory Note other than to deliver such Common Stock and (b) PFG and Group Parent hereby agree to execute and deliver all transaction documents reasonably necessary to effect such conversion and the Note Agreement and the Note Documents shall be deemed terminated. |
2. INTEREST.
Interest Rate (Section 1.2): |
The PFG Investment shall bear interest at a per annum rate equal to the Designated Interest Rate.
In connection with the use or administration of Term SOFR, PFG will have the right to make Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Note Document, any amendments implementing such Conforming Changes will become effective without any further action or consent of any other party to this Agreement or any other Note Document. PFG will promptly notify Company of the effectiveness of any Conforming Changes in connection with the use or administration of Term SOFR.
Designated Interest Rate for each Interest Period shall be determined as of two (2) Business Days prior to the first calendar day of each calendar month; provided that if such day is not a Business Day, such determination shall be made on the immediate succeeding Business Day. It is understood and agreed that the first Interest Period shall begin on the Consent and Amendment Effective Date and end on the last day of the same calendar month and shall bear interest at a rate equal to clause (i) of the definition of Designated Interest Rate.
As used herein:
“Applicable Margin” shall mean a rate of interest equal to 5.00% per annum. “Available Tenor” means, as of any date of determination and with respect to the then-current Benchmark, as applicable, (x) if such Benchmark is a term rate, any tenor for such Benchmark (or component thereof) that is or may be used for determining the length of an interest period pursuant to this Agreement or (y) otherwise, any payment period for interest calculated with reference to such Benchmark (or component thereof) that is or may be used for determining any frequency of making payments of interest calculated with reference to such Benchmark pursuant to this Agreement, in each case, as of such date and not including, for the avoidance of doubt, any tenor for such Benchmark that is then-removed from the definition of “Interest Period” pursuant to this Section 2. “Benchmark” means, initially, the Term SOFR Reference Rate; provided, that if a Benchmark Transition Event has occurred with respect to the Term SOFR Reference Rate or the then-current Benchmark, then “Benchmark” means the |
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applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate pursuant to this Section 2. (a) “Benchmark Replacement” means the first alternative set forth in the order below that can be determined by PFG for the applicable Benchmark Replacement Date: (b) the sum of (i) Daily Simple SOFR and (ii) the related Benchmark Replacement Adjustment; or (c) the sum of: (i) the alternate benchmark rate that has been selected by PFG and Company giving due consideration to (A) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body or (B) any evolving or then-prevailing market convention for determining a benchmark rate as a replacement to the then-current Benchmark for Dollar-denominated syndicated credit facilities and (ii) the related Benchmark Replacement Adjustment. If the Benchmark Replacement as determined pursuant to clause (a) or (b) above would be less than the Floor, the Benchmark Replacement will be deemed to be the Floor for the purposes of this Agreement and the other Note Documents. “Benchmark Replacement Adjustment” means, with respect to any replacement of the then-current Benchmark with an Unadjusted Benchmark Replacement, the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected by PFG and Company giving due consideration to (a) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body or (b) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for Dollar-denominated syndicated credit facilities. “Benchmark Transition Event” means the occurrence of one or more of the following events with respect to the then-current Benchmark: (d) a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof), permanently or indefinitely; provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof); (e) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof), the FRB, the Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator for such Benchmark (or such component), a resolution authority with jurisdiction over the administrator for such Benchmark (or such component) or a court or an |
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entity with similar insolvency or resolution authority over the administrator for such Benchmark (or such component), which states that the administrator of such Benchmark (or such component) has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof) permanently or indefinitely; provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof); or (f) a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that all Available Tenors of such Benchmark (or such component thereof) are not, or as of a specified future date will not be, representative. For the avoidance of doubt, a “Benchmark Transition Event” will be deemed to have occurred with respect to any Benchmark if a public statement or publication of information set forth above has occurred with respect to each then-current Available Tenor of such Benchmark (or the published component used in the calculation thereof). “Benchmark Unavailability Period” means, the period (if any) (a) beginning at the time that a Benchmark Replacement Date has occurred if, at such time, no Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Note Document in accordance with this Section 2, and (b) ending at the time that a Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Note Document in accordance with this Section 2.
“Conforming Changes” means, with respect to either the use or administration of Term SOFR or the use, administration, adoption or implementation of any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of the definition of “Business Day,” the definition of “U.S. Government Securities Business Day,” the definition of “Interest Period” or any similar or analogous definition (or the addition of a concept of “interest period”), timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, the applicability and length of lookback periods, the applicability of any breakage costs and other technical, administrative or operational matters) that PFG reasonably decides, after consultation with Company, may be appropriate to reflect the adoption and implementation of any such rate or to permit the use and administration thereof by PFG in a manner substantially consistent with market practice (or, if PFG decides that adoption of any portion of such market practice is not administratively feasible or if PFG determines that no market practice for the administration of any such rate exists, in such other manner of administration as PFG reasonably decides (after consultation with Company) is reasonably necessary in connection with the administration of this Note and the other Note Documents). “Daily Simple SOFR” means, for any day, SOFR, with the conventions for this rate (which will include a lookback) being established by PFG in accordance with the conventions for this rate selected or recommended by the Relevant Governmental Body for determining “Daily Simple SOFR” for business loans; provided, that if PFG decides that any such convention is not administratively |
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feasible for PFG, then PFG may establish another convention in its reasonable discretion. “Designated Interest Rate” means, for any Interest Period, the greater of (i) a rate of nine and three quarters percent (9.75%) per annum or (ii) Term SOFR, plus the Applicable Margin.
“Floor” means a rate of interest equal to 1.00% per annum. “Interest Payment Date” shall mean, (i) prior to the Maturity Date, the last calendar day of each calendar month and (ii) the Maturity Date. “Interest Period” means the period commencing on the first day of the calendar month and ending on the earlier of (i) last day of the same calendar month and (ii) Maturity Date, provided that, the first Interest Period after the Closing Date, shall begin on the Closing Date and end on the last day of the same calendar month.
“Relevant Governmental Body” means the FRB or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the FRB or the Federal Reserve Bank of New York, or any successor thereto. “Security Agreement” means that certain Security Agreement, dated as of even date herewith, among the Company and the other grantors party thereto from time to time, and LamVen LLC, Partners for Growth V, L.P. and the other secured parties party thereto from time to time. “SOFR” means a rate equal to the secured overnight financing rate as administered by the SOFR Administrator. “SOFR Administrator” means the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate). “Subordination Agreement” means that certain Subordination and Intercreditor Agreement, dated as of November 14, 2024, by and among, CCP Agency, LLC, in its capacity as Tier 1 Agent (as defined therein), Park Lane Investments LLC, in its capacity as Tier 2 Agent (as defined therein), LamVen LLC, in its capacity as Tier 3 Agent (as defined therein), LamVen LLC, in its capacity as Tier 4 Agent (as defined therein) and Partners For Growth V, L.P, as amended, restated, amended and restated, modified or supplemented from time to time. “Term SOFR” means the Term SOFR Reference Rate for a tenor comparable to the applicable Interest Period on the day (such day, the “Periodic Term SOFR Determination Day”) that is two (2) Business Days prior to the first day of such Interest Period, as such rate is published by the Term SOFR Administrator; provided, however, that if as of 5:00 p.m. (New York City time) on any Periodic Term SOFR Determination Day the Term SOFR Reference Rate for the applicable tenor has not been published by the Term SOFR Administrator and a Benchmark Replacement Date with respect to the Term SOFR Reference Rate has not occurred, then Term SOFR will be the Term SOFR Reference Rate for such tenor as published by the Term SOFR Administrator on the first preceding Business Day for which such Term SOFR Reference Rate for such tenor was published by the Term SOFR Administrator so long as such first preceding |
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Business Day is not more than three (3) Business Days prior to such Periodic Term SOFR Determination Day. “Term SOFR Administrator” means CME Group Benchmark Administration Limited (CBA) (or a successor administrator of the Term SOFR Reference Rate selected by PFG in its reasonable discretion). “Term SOFR Reference Rate” means the forward-looking term rate based on SOFR. “U.S. Government Securities Business Day” means any date except for (a) a Saturday, (b) a Sunday or (c) a day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities. |
3. [INTENTIONALLY OMITTED].
4. MATURITY DATE
(Section 5.1): |
December 31, 2028. |
5. FINANCIAL COVENANTS.
None. |
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6. REPORTING
(Section 4.4) |
Borrower shall provide PFG with the following: (a) Annual Financial Statements, as soon as available, and in any event within 150 days following the end of Borrower’s fiscal year, certified by, and with an opinion containing no material qualifications (other than in respect of upcoming maturity of any indebtedness or in respect of actual or anticipated breach of any financial covenants) of, independent certified public accountants of national or regional standing. If Borrower is required to file and is current in its filings with a securities regulatory agency and the same information is generally available to the public within said period through such agency (such as, through EDGAR with respect to US public companies), this requirement will be deemed satisfied. (b) Such other reports and information as PFG may reasonably request and that Borrower may provide without undue burden or cost. |
7. ADDITIONAL PROVISIONS
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1. Borrower shall cause the New Financing to be consummated on or before December 31, 2024. Failure to comply with this provision shall result in an immediate Event of Default hereunder and PFG, at its option and without limitation of all of its rights and remedies hereunder, may apply the Default Rate as permitted by this Agreement. |
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2. Concurrently with any sale by Borrower of shares of common stock, or any preferred class of stock, of Borrower (but excluding any sale of shares through the GEM Equity Purchase Facility or similar share purchase arrangement), if no Senior Obligations under the LamVen Note are then outstanding, Borrower shall apply 15% of the total net cash proceeds of such sale to prepay the Obligations in accordance with Section 1, supra, of this Schedule. |
8. SUBORDINATION
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Anything in this Agreement to the contrary notwithstanding, the Obligations and all other obligations of the Obligors under this Agreement and the other Note Documents (collectively the “Subordinated Obligations”) shall be subject to the Subordination Agreement. Additionally, PFG and each other holder of Subordinated Obligations agree to enter into such intercreditor agreement as the holders of the Senior Obligations may reasonably request to further evidence the subordination provisions above and to establish lien priority in favor of the liens securing the Senior Obligations over the liens securing the Subordinated Obligations (the “Subordination Agreement”). “Senior Obligations” shall mean (i) all obligations under the New Financing, (ii) all obligations under the New LC Reimbursement Agreement, (iii) all obligations in respect of the “Tranche 2 Advances” under the LamVen Note, and (iv) all other obligations identified as “Senior Obligations” in respect of this Agreement (or a term to similar effect) in the Subordination Agreement. Each holder of Subordinated Obligations and each Obligor hereby agree that the subordination provisions set forth in this Agreement and the Subordination Agreement are for the benefit of the holders of Senior Obligations and constitute a “subordination agreement” within the meaning of Section 510(a) of the United States Bankruptcy Code or any comparable provision of any other applicable bankruptcy law. The holders of Senior Obligations are obligees under this Agreement to the same extent as if their names were written herein as such and may proceed to enforce the subordination provisions set forth herein in accordance herewith. |
9. CONDITIONS PRECEDENT
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In addition to any other conditions to the PFG Investment set out in this Agreement, this Agreement is subject to PFG’s receipt of the following, in form and substance satisfactory to PFG, including such additional documents and completion of such other matters as PFG may reasonably deem necessary or appropriate. Without limiting the foregoing, Borrower shall provide: |
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(i) duly executed original signatures of Xxxxxxxx and each other Obligor to this Agreement (which may be in electronic form as set forth elsewhere in this Agreement); |
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(ii) the Constitutional Documents of each such relevant Obligor and, where applicable, a good standing certificate of each Obligor certified by the Secretary of State or other Governmental Body of the jurisdiction of formation of such Obligor, as of a date no earlier than thirty (30) days prior to the date hereof, together with a foreign qualification certificate, |
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in the case of Obligor, from any State in which such new Borrower or Obligor is required to be qualified; |
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(iii) a certificate for each Obligor signed by a Responsible Officer (in the case of Borrower) or a Person authorized to lawfully act on behalf of each Guarantor (in the case of Guarantor) in respect of obligations, appending copies of: (A) its Constitutional Documents, (B) its register of members or capitalization table, (C) its register of charges, and (D) the written resolutions or minutes of its board of directors and if applicable, of its shareholders, authorizing the execution, delivery and performance of the Note Documents to which such Obligor is a party including, and authorizing the Responsible Officer(s), and certifying that such documents are true, correct and in full force and effect on the date of this Agreement; |
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(iv) evidence that of the insurance policies pursuant to Section 4.3 are in full force and effect, in addition to the receipt of any endorsements required by Section 4.3, naming PFG as additional insured; |
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(v) payment of PFG Expenses incurred in connection with this Agreement; |
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(vi) any third party consents required in order for Borrower to enter into and perform the Note Documents; |
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(vii) the Registration Statement shall have been declared effective and shall include for registration of [ ] shares of Common Stock held by PFG (after giving effect to the conversion of the PFG Warrants (other than the PFG Warrant for Class B-4 Preferred Stock, which will remain unconverted) (the “PFG Shares”)) and instruct its transfer agent to issue such PFG Shares no later than the market day after the effectiveness of the Registration Statement and direct the transfer agent to transfer such shares by DWAC on such day to PFG’s broker (Xxxxxx Xxxxxxx or another broker that is a DTC participant). For the avoidance of doubt, the Registration Statement shall not include Common Stock issuable upon conversion of the SAFE Note or the Conversion Shares; |
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(viii) the Common Stock shall have been approved for listing on the New York Stock Exchange, subject to official notice of issuance; |
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(ix) confirmation that Borrower has waived the lock-up provisions contained in Article [__] of the Amended and Restated Bylaws to be adopted in connection with the Direct Listing Process such that PFG will be deemed an “Excluded Person” for all purposes therein; |
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(x) the Borrower has received all representations and other documentation necessary (including opinions of counsel) to allow the legend on the Common Stock issued pursuant to the SAFE Note to be removed and enable PFG to sell such shares under Rule 144; and |
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(xi) the conditions to the closing of the transaction contemplated by the GEM Listing Day Purchase Agreement shall have been satisfied and the purchase price received by the Group Parent. |
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Schedule to be duly executed on the date first written above.
PFG: |
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BORROWER: |
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PARTNERS FOR GROWTH V, L.P. |
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By: |
Partners for Growth V, LLC, Its General Partner |
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By: |
/s/ Xxxxxx Xxxx |
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By: |
/s/ Xxxxxx Xxxxxxx |
Name: |
Xxxxxx Xxxx |
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Name: |
Xxxxxx Xxxxxxx |
Title: |
Manager |
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Title: |
Chief Executive Officer |
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Annex A
List of Deposit Account, Securities Account and Commodity Account:
(to be provided under separate cover)
Existing Indebtedness: See Commission Documents
Existing Liens: See Commission Documents
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Exhibit A
Promissory Note
THIS NOTE AND THE SECURITIES ISSUABLE UPON THE CONVERSTION HEREOF HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED, THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED OR AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR UNLESS SOLD IN ACCORDANCE WITH RULE 144 UNDER SUCH ACT.
SECURED CONVERTIBLE PROMISSORY NOTE
$8,000,000.00 |
Dated: June 21, 2023 |
FOR VALUE RECEIVED, the undersigned, Surf Air Mobility Inc., a Delaware corporation (the “Company”), hereby unconditionally promises to pay to PARTNERS FOR GROWTH V, L.P., a Delaware limited partnership (“Holder”) the principal amount set forth above ($8,000,000.00) together with accrued and unpaid interest as calculated hereunder, or such greater or lesser balance as represents the total unpaid principal amount of all of the outstanding PFG Investment made by Holder to Company under that certain Convertible Note Purchase Agreement dated June 20, 2023 between Company and Holder (together with all Exhibits and Schedules thereto, as the same may be subsequently amended, extended, restated or otherwise modified, the “Note Agreement”). Unless defined herein, capitalized terms shall have the meanings given such terms in the Note Agreement.
This document shall be referred to herein as the “Promissory Note”.
1. The entire unpaid principal balance of this Promissory Note, all accrued and unpaid interest thereon, all fees, costs and expenses payable in connection with the PFG Investment, and all other sums due hereunder and under the Note Documents in connection with the PFG Investment, shall be due and payable in cash IN FULL on the Maturity Date or on any earlier date provided in the Note Agreement or converted into common stock of the Group Parent, at Holder’s election.
2. Company shall pay interest on the outstanding principal amount of this Promissory Note to Holder until all Obligations with respect to this Promissory Note and the PFG Investment have been finally and indefeasibly paid to Holder in cash and performed in full, or converted in full, in each case, in the manner set forth in the Note Agreement.
3. All repayments and prepayments of principal, all payments of interest, all payments of fees, costs and expenses payable, and all issuances of the Conversion Shares, in connection with the PFG Investment shall be made by Company pursuant to the terms of the Note Agreement. Company may prepay the indebtedness evidenced by this Promissory Note in whole pursuant to, and subject to, the applicable provisions of the Note Agreement and Note Documents.
4. This Promissory Note evidences the PFG Investment and is entitled to the benefit of all of the terms and conditions set forth in the Note Agreement, and all of the other Note Documents including, without limitation, supplemental provisions regarding mandatory and/or optional prepayment rights and premiums.
5. The entire unpaid Obligations evidenced by this Promissory Note shall become due and payable, upon the occurrence of any Event of Default, as provided in the Note Agreement. After an Event of Default, Holder shall have all of the rights and remedies available to Holder as set forth in the Note Documents, including but not limited to those relating to the enforcement of this Promissory Note and collection of the Obligations owing in connection with this Promissory Note and the PFG Investment.
6. The agreements, covenants, indebtedness, liabilities and Obligations of Company set forth in this Promissory Note shall continue to be effective, or be reinstated, as the case may be, if at any time any payment in
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respect of the PFG Investment is rescinded or must otherwise be restored or returned by Holder by reason of any bankruptcy, reorganization, arrangement, composition or similar proceeding or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, Company or any other Person, or any property of Company or any other Person, or otherwise, all as though such payment had not been made.
7. Whenever any payment to be made under this Promissory Note shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day and such extension of time shall be included in the computation of any interest then due and payable hereunder.
8. Company and all other parties who, at any time, may be liable hereon in any capacity waive presentment, demand for payment, protest and notice of dishonor of this Promissory Note. This Promissory Note and any provision hereof may not be waived, modified, amended or discharged orally, but only by an agreement in writing which is signed by the holder and the party or parties against whom enforcement of any waiver, change, modification, amendment or discharge is sought.
9. This Promissory Note shall be binding upon Company, its successors and assigns, and shall inure to the benefit of Xxxxxx, its successors and assigns. Holder shall have the right, without the necessity of any further consent of or other action by Company, to sell, assign, securitize or grant participations in all or a portion of Holder’s interest in this Promissory Note to other financial institutions of Holder’s choice and on such terms as are acceptable to Holder in Holder’s sole discretion. Company shall not assign, exchange or otherwise hypothecate any Obligations under this Promissory Note or any other rights, liabilities or obligations of Company in connection with this Promissory Note, in whole or in part, without the prior written consent of the Holder, and any attempted assignment, exchange or hypothecation without such written consent shall be void and be of no effect.
10. This Promissory Note and all acts, transactions, disputes and controversies arising hereunder or relating hereto, and all rights and obligations of the parties shall be governed by, and construed in accordance with, the internal laws (and not the conflict of laws rules) of the State of California. All disputes, controversies, claims, actions and other proceedings involving, directly or indirectly, any matter in any way arising out of, related to, or connected with, this Promissory Note or the relationship between the parties, and any and all other claims of Company against Holder of any kind, shall be brought only in a court located in Santa Clara County, California, and each party consents to the jurisdiction of an such court and the referee referred to below, and waives any and all rights the party may have to object to the jurisdiction of any such court, or to transfer or change the venue of any such action or proceeding, including, without limitation, any objection to venue or request for change in venue based on the doctrine of forum non conveniens; provided that, notwithstanding the foregoing, nothing herein shall limit the right of Holder to bring proceedings against Company in the courts of any other jurisdiction. Company consents to service of process in any action or proceeding brought against it by Xxxxxx, by personal delivery, or by mail addressed as set forth in this Promissory Note or by any other method permitted by law.
11. Any controversy, dispute or claim between the parties based upon, arising out of, or in any way relating to this Promissory Note or any supplement or amendment thereto shall be resolved exclusively by judicial reference as provided in Section 8.26 of the Note Agreement.
12. EACH OF COMPANY AND HOLDER (BY ITS ACCEPTANCE OF THIS PROMISSORY NOTE) ACKNOWLEDGES THAT THE RIGHT TO TRIAL BY JURY IS A CONSTITUTIONAL RIGHT, BUT THAT IT MAY BE WAIVED. EACH OF THE PARTIES, AFTER CONSULTING OR HAVING HAD THE OPPORTUNITY TO CONSULT, WITH COUNSEL OF THEIR CHOICE, KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION BASED UPON OR ARISING OUT OF THIS PROMISSORY NOTE OR ANY RELATED INSTRUMENT OR AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED BY THIS PROMISSORY NOTE OR ANY COURSE OF CONDUCT, DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN), ACTION OR INACTION OF ANY OF THEM. THESE PROVISIONS SHALL NOT BE DEEMED TO HAVE BEEN MODIFIED IN ANY RESPECT OR RELINQUISHED BY ANY PARTY HERETO, EXCEPT BY A WRITTEN INSTRUMENT EXECUTED BY EACH OF THEM. IF FOR ANY REASON THE PROVISIONS OF THIS SECTION ARE VOID, INVALID OR UNENFORCEABLE, THE SAME SHALL NOT AFFECT ANY OTHER TERM OR PROVISION OF THIS PROMISSORY NOTE, AND
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ALL OTHER TERMS AND PROVISIONS OF THIS PROMISSORY NOTE SHALL BE UNAFFECTED BY THE SAME AND CONTINUE IN FULL FORCE AND EFFECT.
[Signature Page Follows]
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IN WITNESS WHEREOF, the undersigned has executed this Promissory Note on the day and year first above written.
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Name: |
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Title: |
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