Preview
FILED: ROCKLAND COUNTY CLERK 04/11/2024 05:58 PM INDEX NO. 032018/2024
DocuSign Envelope ID: D2FB5B46-2A4D-4630-9BD9-C3DD6C1894FB
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 04/11/2024
REVENUE PURCHASE AGREEMENT
Agreement dated _______________________
January 23, 2024 between Kalamata Capital Group, LLC (“Purchaser”) and the Seller(s) listed below (“Seller”)
(Month) (Day) (Year)
Business (Seller) Legal Name: _________________________________________________
LOCUS DIGITAL, LLC AND THE ENTITIES LISTED ON APPENDIX A
Doing Business As: ___________________________________________
LOCUS DIGITAL FEIN: __________ State of Inc. / Org. : _______
TX
Entity Type: __________________________
LIMITED LIABILITY COMPANY
Business Address: ___________________________
5851 LEGACY CIR FL 6 City: ________________
PLANO State: _____________
TX Zip: ________
75024
Mailing Address: ___________________________
SAME AS ABOVE City: ________________ State: _____________ Zip: ________
Designated Email Address (for Notices): abe@locusdigital.com
__________________________ (Primary) __________________________ (Secondary Optional)
Purchase Price: $___________
75,000.00 15
Purchased Percent: _____% Purchased Amount: $___________
105,000.00
Net Funding $____________
72,638.50 (after applicable fees set forth on Appendix B and payoff of any existing financing)
Remittance Frequency: _______
WEEKLY Remittance: $ ________
2,387.00 (Subject to adjustment – See Paragraphs 1.3 & 1.4) ________
Remittance Method (primary): ( ) Processor ( ✔) ACH
PURCHASE AND SALE OF FUTURE RECEIVABLES
Seller hereby sells, assigns and transfers to Seller’s business may slow down or fail, and the entire Purchased Amount. Seller hereby
Purchaser (making Purchaser the absolute owner) Purchaser assumes these risks based on Seller’s authorizes Purchaser to ACH debit the Remittance
in consideration of the Purchase Price specified representations, warranties and covenants in this from the Account on the Remittance Frequency,
above, the Purchased Percent of all of Seller’s Agreement, which are designed to give Purchaser and, upon an Event of Default to change the
future receipts, contract rights and other a reasonable and fair opportunity to receive the Remittance Frequency, in Purchaser’s sole
entitlements arising from or relating to the benefit of its bargain. Seller and Guarantor(s) are discretion. The parties agree that the initial and
payment of monies from Seller’s customers and/or only guaranteeing their performance of the terms final Remittances may be prorated in Purchaser’s
other third party payors (the “Future Receipts” of this Revenue Purchase Agreement and are not sole discretion; as applicable, “daily” means any
which include all payments made by cash, check, guaranteeing the payment of the Purchased day that is not a United States banking holiday,
electronic transfer or other form of monetary Amount. The initial Remittance shall be as and ”weekly” means, as determined by Purchaser
payment deposited into Seller’s bank account), for described above. The Remittance is subject to from time to time, a day, which is not a United
the payments to Seller as a result of Seller’s sale adjustment as set forth in Paragraphs 1.3 and 1.4 States banking holiday, recurring every week until
of goods and/or services until the Purchased to better reflect the actual Purchased Percent of the entire Purchased Amount is received by
Amount has been delivered by or on behalf of the Future Receipts. Purchaser. Seller understands that it is responsible
Seller to Purchaser. Seller shall select the primary method for ensuring for notifying Purchaser if the Remittance will not
Purchaser’s payment of the Purchase Price shall be Remittances are received by Purchaser: Either (1) be in the Account and will be held responsible for
deemed the acceptance and performance by Purchaser will debit the Remittance via ACH each any fees incurred by Purchaser resulting from a
Purchaser of this Agreement. business day (“ACH Remittances”) from only rejected ACH attempt or an Event of Default.
Seller is selling a portion of a future revenue one bank deposit account, which account must be Purchaser is not responsible for any overdrafts or
stream to Purchaser at a discount, not borrowing acceptable to, and pre-approved by, Purchaser rejected transactions that may result from
money from Purchaser; therefore, there is no (the “Account”), or (2) a credit and debit card Purchaser’s ACH debiting of the agreed
interest rate or payment schedule and no time processor (the “Processor”) acceptable to Remittance under the terms of this Agreement.
period during which the Purchased Amount must Purchaser shall remit all Future Receipts to a Notwithstanding anything to the contrary in this
be collected by Purchaser. The Remittance is a deposit account designated by Purchaser Agreement or any other agreement between
good faith estimate of the Purchased Percent (“Processor Remittances”). For ACH Purchaser and Seller, upon the occurrence of an
multiplied by revenues of Seller. Seller filing Remittances, Seller and Seller’s customers shall Event of Default hereunder, the Purchased
bankruptcy or going out of business, or remit all Future Receipts into the Account, until Percent shall equal 100% and the entire
experiencing a slowdown in business, or a delay in such time as Purchaser receives delivery of the undelivered Purchased Amount is immediately
collecting its receivables, in and of itself, does not entire Purchased Amount. Seller shall not deposit due. A list of all fees applicable under this
constitute a breach of this Agreement. Purchaser any Future Receipts into any account other than Agreement is contained in Appendix B.
is entering this Agreement knowing the risks that the Account until Purchaser receives delivery of
THE REVENUE PURCHASE AGREEMENT “TERMS AND CONDITIONS,” THE SECURITY AGREEMENT AND GUARANTY, THE ADMINISTRATIVE
FORM AND FOLLOWING PAGES, ARE ALL HEREBY INCORPORATED IN AND MADE A PART OF THIS REVENUE PURCHASE AGREEMENT.
LOCUS DIGITAL, LLC
SELLER: _____________________________________ AND THE ENTITIES LISTED ON APPENDIX A
By: _______________________
IBRAHEEM AHMED RUBARTS _______________________ Guarantor #1: ____________________
IBRAHEEM AHMED RUBARTS __________________
(Print Name) (Signature) (Print Name) (Signature)
By: _______________________ _______________________ Guarantor #2: ____________________ __________________
(Print Name) (Signature) (Print Name) (Signature)
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TERMS AND CONDITIONS OF REVENUE PURCHASE AGREEMENT
I. TERMS OF ENROLLMENT IN PROGRAM 1.6 Transactional History
1.1 Seller Deposit Agreement and Processor Seller shall authorize all of its banks, brokers and card processors to provide
Seller shall (A) execute an agreement acceptable to Purchaser with a Bank Purchaser with Seller’s banking, brokerage and/or processing history to
acceptable to Purchaser to obtain electronic fund transfer services for the determine qualification or continuation in this program and for collections
Account, and (B) if applicable, execute an agreement acceptable to Purchaser purposes. Seller shall provide Purchaser with copies of any documents related
with the Processor, instructing the Processor to remit all Future Receipts to a to Seller’s card processing activity or financial and banking affairs within five
deposit account designated by Purchaser. If Seller selects Processor (5) calendar days after Purchaser’s request.
Remittances as its primary Remittance Method, Seller shall have five (5) 1.7 Indemnification
business days to ensure collections of Future Receipts and Remittances are Seller and Guarantor(s) jointly and severally indemnify and hold harmless
being sent by Processor to Purchaser. Until the Purchased Amount and any Processor, its officers, directors and shareholders against all losses, damages,
costs, fees or charges hereunder have been received by Purchaser, Seller shall claims, liabilities, and expenses (including reasonable attorney’s fees) incurred
maintain ACH Remittances as a secondary Remittance Method. At any time by Processor resulting from (a) claims asserted by Purchaser for monies owed
and to the extent that Processor Remittances are not being received by to Purchaser from Seller and (b) actions taken by Processor in reliance upon
Purchaser or otherwise fail, Purchaser has the ability, without notice to Seller, any fraudulent, misleading or deceptive information or instructions provided
to rely on ACH Remittances to make ACH debits necessary to receive the by Seller.
amount of the Remittance agreed to herein. Seller shall provide Purchaser 1.8 No Liability
and/or its authorized agent(s) with all of the information, authorizations and In no event will Purchaser be liable for any claims asserted by Seller or
passwords necessary for verifying Seller’s receivables, receipts, deposits and Guarantor(s) under any legal theory for lost profits, lost revenues, lost business
withdrawals into and from the Account. Seller hereby authorizes Purchaser opportunities, exemplary, punitive, special, incidental, indirect or consequential
and/or its agent(s) to withdraw from the Account via ACH debit the amounts damages, each of which is waived by both Seller and Guarantor(s). In the
owed to Purchaser for the receipts as specified herein and to pay such amounts event these claims are nonetheless raised, Seller and Guarantor(s) will be
to Purchaser. These authorizations apply not only to the approved Account but jointly and severally liable for all of Purchaser’s attorney’s fees and expenses
also to any subsequent or alternate account used by the Seller for these resulting therefrom.
deposits, whether pre-approved by Purchaser or not. This additional 1.9 Third Party Beneficiaries
authorization is not a waiver of Purchaser’s entitlement to declare this The parties agree that Processor and Seller’s bank are third party beneficiaries
Agreement breached by Seller as a result of its usage of an account which for the purposes of Sections 1.1, 1.5, 1.6, 1.7 and 2.5 of this Agreement
Purchaser did not first pre-approve in writing prior to Seller’s usage thereof. notwithstanding the fact that Processor and such bank are not parties to this
The aforementioned authorizations shall be irrevocable without the written Agreement, Processor and the bank may rely upon such terms in any action.
consent of Purchaser. Except as provided herein, this Agreement is for the sole benefit of the parties
1.2 No Fixed Term of Agreement hereto and their permitted successors and assigns, and nothing herein, express
This Agreement shall remain in full force and effect until the entire Purchased or implied, is intended to or shall confer upon any other person or entity any
Amount and any costs, fees, or charges incurred are received by Purchaser as legal or equitable right, benefit or remedy of any nature whatsoever under or
per the terms of this Agreement. by reason of this Agreement.
1.3 Reconciliation 1.10 Sale of Receipts
Every two calendar weeks from the date on page 1 of this Agreement, Seller Seller and Purchaser agree that the Purchase Price under this Agreement is in
shall submit its bank statements and financial information to Purchaser, and exchange for the Purchased Amount, and that such Purchase Price is not
Purchaser shall reconcile the amount due to Purchaser by either crediting or intended to be, nor shall it be construed as a loan from Purchaser to Seller.
debiting the Account so that the total amount of Remittances equals the Seller agrees that the Purchase Price is in exchange for the Future Receipts
Purchased Percent multiplied by the Seller’s collections of Future Receipts for pursuant to this Agreement, and that it equals the fair market value of such
the preceding two calendar weeks period. Purchaser retains the right to Future Receipts. Purchaser has purchased and shall own all the Future Receipts
request additional documentation including but not limited to bank login or described in this Agreement up to the full Purchased Amount as the Future
DecisionLogic access to view Seller’s accounts. All such submissions shall be Receipts are created. Remittances made to Purchaser in respect of the
sent in writing to reconciliations@kalamatacapitalgroup.com. Seller shall have Purchased Amount shall be conditioned upon Seller’s sale of products and
no right to a reconciliation if an Event of Default, or other breach of this services, and the payment therefore by Seller’s customers. In no event shall
Agreement, has occurred. Upon receipt of the appropriate information, the aggregate of all amounts or any portion thereof be deemed as interest
Purchaser shall perform the reconciliation within 3 business days. hereunder, and in the event that it is found to be interest despite the parties
1.4 Adjustments to the Remittance specifically representing that it is NOT interest, it shall be found that no sum
As long as an Event of Default, or other breach of this Agreement, has not charged or collected hereunder shall exceed the highest rate permissible at
occurred, and if Seller experiences a decrease in its Future Receipts, Seller may law. In the event that a court nonetheless determines that Purchaser has
submit a request to Purchaser to decrease the Remittance in accordance with charged or received interest hereunder in excess of the highest applicable rate,
the procedures for reconciliation submission set forth in Section 1.3 hereof so the rate in effect hereunder shall automatically be reduced to the maximum
the Remittance shall more closely reflect the Seller’s Future Receipts multiplied rate permitted by applicable law and Purchaser shall promptly refund to Seller
by the Purchased Percent. Purchaser shall reconcile Remittance in accordance any interest received by Purchaser in excess of the maximum lawful rate, it
with Section 1.3. being intended that Seller not pay or contract to pay, and that Purchaser not
1.5 Financial Condition receive or contract to receive, directly or indirectly in any manner whatsoever,
Seller and Guarantor(s) (as hereinafter defined and limited) authorize interest in excess of that which may be paid by Seller under applicable law. As
Purchaser and its agents to investigate their financial responsibility and history, a result, thereof, Seller knowingly and willingly waives the defense of usury in
and will provide to Purchaser any authorizations, bank or financial statements, any action or proceeding.
tax returns, etc., as Purchaser deems necessary in its sole and absolute 1.11 Power of Attorney
discretion prior to or at any time after execution of this Agreement. A Seller irrevocably appoints Purchaser as its agent and attorney-in-fact with full
photocopy of this authorization will be deemed as acceptable as an authority to take any action or execute any instrument or document to settle
authorization for release of financial and credit information. Purchaser is all obligations due to Purchaser from Processor, or in the case of a violation by
authorized to update such information and financial and credit profiles from Seller of Section 1 or the occurrence of an Event of Default under Section 3
time to time as it deems appropriate. hereof, including without limitation (i) to obtain and adjust insurance; (ii) to
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collect monies due or to become due under or in respect of any of the 1.15 Publicity
Collateral; (iii) to receive, endorse and collect any checks, notes, drafts, Seller and each of Seller’s Owners and all Guarantors hereto all hereby
instruments, documents or chattel paper in connection with clause (i) or clause authorizes Purchaser to use its, his or her name in listings of clients and in
(ii) above; (iv) to sign Seller’s name on any invoice, bill of lading, or assignment advertising and marketing materials.
directing customers or account debtors to make payment directly to Purchaser; 1.16 Trade Names
(v) to contact Seller’s banks and financial institutions using Seller and Seller hereby acknowledges and agrees that Purchaser may be using trade
Guarantor(s) personal information to verify the existence of an account and names, “doing business as”, or “d/b/a” names in connection with various
obtain account balances; (vi) to file any claims or take any action or institute matters relating to the transaction between Purchaser and Seller, including the
any proceeding which Purchaser may deem necessary for the collection of any filing of UCC-1 financing statements and other notices or filings.
of the undelivered Purchased Amount from the Collateral, or otherwise to
enforce its rights with respect to delivery of the Purchased Amount. In
II. REPRESENTATIONS, WARRANTIES AND COVENANTS
Seller represents warrants and covenants that, as of this date and, unless
connection therewith, all costs, expenses and fees, including legal fees, shall
expressly stated otherwise, during the course of this Agreement:
be payable by Seller.
1.12 Interference with Receipts 2.1 Financial Condition and Financial Information
Seller’s and Guarantors’ bank and financial statements, copies of which have
Seller agrees that it will not engage in or voluntarily permit the following
been furnished to Purchaser, and future statements which will be furnished
actions and acknowledges that each of the following is an Event of Default:
hereafter upon Purchaser’s request, fairly represent the financial condition of
(a) Seller takes any action to discourage the use of electronic check processing
Seller at such dates, and since those dates there has been no material adverse
that are settled through Processor, or permits any event to occur that could
changes, financial or otherwise, in such condition, operation or ownership of
have an adverse effect on the use, acceptance, or authorization of checks or
Seller. Seller and Guarantors have a continuing, affirmative obligation to advise
other payments or deposits for the purchase of Seller’s services and products,
Purchaser of any material adverse change in their financial condition, operation
including but not limited to, direct deposit of any checks into a bank account
or ownership. Purchaser may request statements at any time during the
without scanning into the Purchaser electronic check processor; (b) Seller
performance of this Agreement and the Seller and Guarantors shall provide
changes its arrangements with Processor or its bank in any way that is adverse
them to Purchaser within five business days after request from Purchaser.
or unacceptable to Purchaser; (c) Seller changes the electronic check processor
Seller’s or Guarantors’ failure to do so is a material breach of this Agreement.
through which the Receipts are settled from Processor to another electronic
check processor, or permits any event to occur that could cause diversion of 2.2 Governmental Approvals
any of Seller’s check or deposit transactions to another processor; (d) Seller Seller is in compliance and shall comply with all laws and has valid permits,
intentionally interrupts the operation of this business, transfers, moves, sells, authorizations and licenses to own, operate and lease its properties and to
disposes, or otherwise conveys its business and/or assets without (i) the conduct the business in which it is presently engaged and/or will engage in
express prior written consent of Purchaser, and (ii) the written agreement of hereafter.
Purchaser or its transferee to the assumption of all of Seller’s obligations under 2.3 Authorization
this Agreement pursuant to documentation satisfactory to Purchaser; (e) Seller Seller, Guarantor(s) and the person(s) signing this Agreement on behalf of
takes any action, fails to take any action, or offers any incentive—economic or Seller, have full power and authority to incur and perform the obligations under
otherwise—to induce any customer(s) to pay for Seller’s services with any this Agreement, all of which have been duly authorized.
means other than payments, checks or deposits that are settled through 2.4 Use of Funds
Processor; or (f) Seller fails to provide Purchaser with copies of any documents Seller and Guarantor(s) agree that it shall use the Purchase Price for business
related to Seller’s card processing activity of financial and banking affairs within purposes, that Seller is receiving the Purchase Price and selling Purchaser the
five calendar days after a request from Purchaser. Purchased Amount in good faith and will use the Purchase Price funds to
These protections are in addition to any other remedies available to maintain and grow Seller’s business and not for personal, family, or household
Purchaser at law, in equity or otherwise pursuant to this purposes.
Agreement. 2.5 Electronic Payment Processing Agreement
1.13 Protection of Information Seller will not change Processor, add terminals or use other equipment to
Seller and each person signing this Agreement on behalf of Seller and/or as process credit and debit card payments, change its financial institution or bank
Owner or Guarantor, in respect of himself or herself personally, authorizes account(s) or take any other action that could have any adverse effect upon
Purchaser to disclose information concerning Seller’s and each Owner’s and Seller’s obligations under this Agreement, without Purchaser’s prior written
each Guarantor’s credit standing (including credit bureau reports that consent. Any such changes shall be a material breach of this Agreement.
Purchaser obtains) and business conduct only to agents, affiliates, subsidiaries, 2.6 Change of Name or Location
and credit reporting bureaus. Seller and each Owner and each Guarantor Seller will not conduct Seller’s businesses under any name other than as
hereby and each waives to the maximum extent permitted by law any claim disclosed to the Processor and Purchaser, nor shall Seller change any of its
for damages against Purchaser or any of its affiliates relating to any (i) places of business without prior written consent by Purchaser.
investigation undertaken by or on behalf of Purchaser as permitted by this 2.7 Daily Batch Out
Agreement or (ii) disclosure of information as permitted by this Agreement. Seller will batch out receipts with Processor on a daily basis if applicable.
1.14 Confidentiality 2.8 Estoppel Certificate
Seller understands and agrees that the terms and conditions of the products Seller will at every and all times, and from time to time, upon at least one (1)
and services offered by Purchaser, including this Agreement and any other day’s prior notice from Purchaser to Seller, execute, acknowledge and deliver
Purchaser documents (collectively, “Confidential Information”) are to Purchaser and/or to any other person, firm or corporation specified by
proprietary and confidential information of Purchaser. Accordingly, unless Purchaser, a statement certifying that this Agreement is unmodified and in full
disclosure is required by law or court order, Seller shall not disclose force and effect (or, if there have been modifications, that the same is in full
Confidential Information of Purchaser to any person other than an attorney, force and effect as modified and stating the modifications) and stating the
accountant, financial advisor or employee of Seller who needs to know such dates which the Purchased Amount or any portion thereof has been repaid.
information for the purpose of advising Seller (“Advisor”), provided such 2.9 No Bankruptcy
Advisor uses such information solely for the purpose of advising Seller and first As of the date of this Agreement, Seller is not insolvent and does not
agrees in writing to be bound by the terms of this Section. A breach hereof contemplate filing for bankruptcy in the next six months and has not consulted
entitles Purchaser to not only damages and reasonable attorney’s fees but also with a bankruptcy attorney or filed any petition for bankruptcy protection under
to both a temporary restraining order and a preliminary injunction without Title 11 of the United States Code and there has been no involuntary petition
bond or security. brought or pending against Seller. Seller further warrants that it does not
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anticipate filing any such bankruptcy petition and it does not anticipate that an 3.4 Remedies
involuntary petition will be filed against it. If any Event of Default occurs, Purchaser may proceed to protect and enforce
2.10 Unencumbered Receipts its rights or remedies by suit in equity or by action at law, or both, whether for
Seller has, and will have, good, complete, unencumbered and marketable title the specific performance of any covenant, agreement or other provision
to all Future Receipts, free and clear of any and all liabilities, liens, claims, contained herein, or to enforce Seller’s obligations hereunder (including the
changes, restrictions, conditions, options, rights, mortgages, security interests, Guaranty) or any other legal or equitable right or remedy and enforcing the
equities, pledges and encumbrances of any kind or nature whatsoever or any Security Agreement contained herein. All rights, powers and remedies of
other rights or interests that may be inconsistent with the transactions Purchaser in connection with this Agreement may be exercised at any time by
contemplated with, or adverse to the interests of, Purchaser. Purchaser after the occurrence of an Event of Default, are cumulative and not
2.11 Business Purpose exclusive, and shall be in addition to any other rights, powers or remedies
Seller is a valid business in good standing under the laws of the jurisdictions provided by law or equity. Additionally, and in no way limiting any other
in which it is organized and/or operates, and Seller is entering into this available remedies, if any Event of Default occurs, immediately and with or
Agreement for business purposes and not as a consumer for personal, family without notice unless otherwise required by law:
or household purposes. (a) The full uncollected Purchased Amount becomes due and payable in full
2.12 Defaults under Other Contracts immediately, and all fees (including reasonable attorney’s fees and costs of
Seller’s execution of, and/or performance under this Agreement, will not cause collection in the amount of 25% of the Purchased Amount then outstanding)
or create an event of default by Seller under any contract with another person due under this Agreement and the attached Security Agreement become due
or entity. and payable in full immediately;
(b) Purchaser may enforce the provisions of the Guaranty of Performance
III. EVENTS OF DEFAULT AND REMEDIES against the Guarantor(s);
3.1 Events of Default (c) Purchaser may enforce its security interest in the Collateral;
The occurrence of any of the following events shall constitute an “Event of (d) Purchaser may proceed to protect and enforce its right and remedies by
Default” hereunder: lawsuit. In any such lawsuit, if Purchaser recovers a judgment against Seller,
(a) Seller or any Guarantor shall violate any term or covenant in this Seller shall be liable for all of Purchaser’s costs of the lawsuit, including but not
Agreement, its guaranty or any agreement with Processor; limited to all reasonable attorneys’ fees and costs of collection in the amount
(b) Any representation or warranty by Seller or Guarantor in this Agreement, of 25% of the Purchased Amount then outstanding under this Agreement.
or its guaranty, as applicable shall prove to have been incorrect, false or Upon breach of any provision in this Agreement, Purchaser may exercise its
misleading in any material respect when made; rights under the assignment of Lease without prior notice to Seller. Purchaser
(c) The sending of notice of termination by Seller or verbally notifying may debit Seller’s depository accounts wherever situated by means of ACH
Purchaser of its intent to breach this Agreement; debit or facsimile signature on a computer-generated check drawn on Seller’s
(d) Seller fails to give Purchaser 24 hours advance notice that there will be bank account or otherwise for all sums due to Purchaser.
insufficient funds in the account such that the ACH of the Remittance will not 3.5 Costs
be honored by Seller’s bank; Seller shall pay to Purchaser all reasonable costs associated with (a) an Event
(e) Seller fails, within 2 business days of Purchaser’s request, to supply all or Default, (b) breach by Seller of the representations, warranties or covenants
requested documentation and allow for daily and/or real time monitoring of in this Agreement and the enforcement thereof, and (c) the enforcement of
the Account; Purchaser‘s remedies set forth in this Agreement, including but not limited to
(f) Seller shall, or shall enter into any agreement to, transfer or sell, all or attorneys’ fees and costs of collection in the amount of 25% of the Purchased
substantially all of its assets; Amount then outstanding under this Agreement.
(g) Seller shall make or send notice of any intended bulk sale or transfer by 3.6 Required Notifications
Seller; Seller is required to give Purchaser written notice within 24 hours of any filing
(h) Seller shall use multiple depository accounts without the prior written under Title 11 of the United States Code. Seller is required to give Purchaser
consent of Purchaser; five business days’ written notice prior to the closing of any sale of all or
(i) Seller shall enter into any financing agreements with any other party substantially all of the Seller’s assets or stock.
including but not limited to loans, merchant cash advances, receivables
financing, or any other agreement that will increase the total debt or IV. MISCELLANEOUS
remittances owed by Seller to any other party; 4.1 Modifications; Agreements
(j) Seller shall change the Account or Processor without the prior written No modification, amendment, waiver or consent of any provision of this
consent of Purchaser; Agreement shall be effective unless the same shall be in writing and signed by
(k) Seller’s bank returns a code other than NSF preventing Purchaser from Purchaser.
initiating ACH Remittances or collecting Future Receipts; or 4.2 Successors and Assigns
(l) Seller shall default under any of the terms, covenants and conditions of any Purchaser may assign, transfer or sell any or all its rights under this Agreement,
other agreement with Purchaser. or its right to receive the Purchased Amount or delegate its duties hereunder,
3.2 Bankruptcy Not Default either in whole or in part, with or without prior written notice to Seller. This
Notwithstanding any other provision of this Agreement, filing for bankruptcy, Agreement shall be binding upon and inure to the benefit of Seller, Purchaser
becoming insolvent, or winding up the Seller’s business for financial reasons is and their respective successors and assigns, except that Seller shall not have
not a breach of this Agreement or an Event of Default, so long as Seller the right to assign its rights hereunder or any interest herein without the prior
complies with the other terms of this Agreement. These other terms include, written consent of Purchaser which consent may be withheld in Purchaser’s
for example, the continuing affirmative obligation to advise Purchaser of any sole discretion.
material adverse change in Seller’s financial condition, operation or ownership, 4.3 Notices
as required by Section 2.1. All notices, requests, consents, demands and other communications hereunder
3.3 Personal Guaranty shall be delivered by (1) certified mail, return receipt requested, or (2) email,
Seller agrees and acknowledges that if an Event of Default occurs, Purchaser to the respective parties to this Agreement at the addresses set forth in this
will enforce its rights against the Guarantor(s). Upon such Event of Default, Agreement. Notices to Purchaser shall become effective only upon receipt by
said Guarantor(s) will be jointly and severally liable to Purchaser for all of Purchaser. Notices to Seller shall become effective three days after mailing, or
Purchaser’s losses and damages, in addition to all costs and expenses and legal immediately if by email. Notices that the Account does not contain sufficient
fees associated with such enforcement. funds, however, must be made by email to the following address:
customerservice@kalamatacapitalgroup.com.
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4.4 Waiver Remedies construction determinations shall be made against either party hereto as
No failure on the part of Purchaser to exercise, and no delay in exercising any drafter.
right under this Agreement shall operate as a waiver thereof, nor shall any 4.8 Severability
single or partial exercise of any right under this Agreement preclude any other In case any of the provisions in this Agreement is found to be invalid, illegal or
or further exercise thereof or the exercise of any other right. The remedies unenforceable in any respect, the validity, legality and enforceability of any
provided hereunder are cumulative and not exclusive of any remedies provided other provision contained herein shall not in any way be affected or impaired.
by law or equity. 4.9 Entire Agreement
4.5 Governing Law, Venue and Jurisdiction Any provision hereof prohibited by law shall be ineffective only to the extent
This Agreement, Security Agreement and Guaranty of Performance, and any of such prohibition without invalidating the remaining provisions hereof. This
and all addendums, attachments, exhibits and other documents relating to this Agreement, the Security Agreement and Guaranty hereto embody the entire
Agreement shall be governed by and construed in accordance with the laws of agreement between Seller and Purchaser and supersede all prior agreements
the state of New York, without regards to any applicable principals of conflicts and understandings relating to the subject matter hereof.
of law. Any suit, action or proceeding arising hereunder, or the interpretation, 4.10 JURY TRIAL WAIVER
performance or breach hereof, shall, if Purchaser so elects, be instituted in any THE PARTIES HERETO WAIVE TRIAL BY JURY IN ANY COURT IN ANY SUIT,
court sitting in New York (the “Acceptable Forums”). Seller and Guarantor(s) ACTION OR PROCEEDING ON ANY MATTER ARISING IN CONNECTION WITH
agree that the Acceptable Forums are convenient and submit to the jurisdiction OR IN ANY WAY RELATED TO THE TRANSACTIONS OR THE ENFORCEMENT
of the Acceptable Forums and waive any and all objections to jurisdiction or HEREOF. THE PARTIES HERETO ACKNOWLEDGE THAT EACH MAKES THIS
venue. If such proceeding be initiated in any other forum, Seller and WAIVER KNOWINGLY, WILLINGLY AND VOLUNTARILY AND WITHOUT
Guarantor(s) waive any right to oppose any motion or application made by DURESS, AND ONLY AFTER EXTENSIVE CONSIDERATION OF THE
Purchaser to transfer such proceeding to an Acceptable Forum. RAMIFICATIONS OF THIS WAIVER WITH THEIR ATTORNEYS.
Seller and Guarantor(s) hereby agree to waive their right to service of 4.11 CLASS ACTION WAIVER
process as prescribed by New York Civil Practice Law and Rules. Seller THE PARTIES HERETO WAIVE ANY RIGHT TO ASSERT ANY CLAIMS AGAINST
and Guarantor(s) further agree that the mailing by certified or registered THE OTHER PARTY AS A REPRESENTATIVE OR MEMBER IN ANY CLASS OR
mail, return receipt requested to the Mailing Address listed in this REPRESENTATIVE ACTION, EXCEPT WHERE SUCH WAIVER IS PROHIBITED
Agreement, of any process required by any such court will constitute valid
BY LAW AS AGAINST PUBLIC POLICY. TO THE EXTENT EITHER PARTY IS
and lawful service of process against them without the necessity for
PERMITTED BY LAW OR COURT OF LAW TO PROCEED WITH A CLASS OR
service by any other means provided by statute or rule of court, but
without invalidating service performed in accordance with such other REPRESENTATIVE ACTION AGAINST THE OTHER, THE PARTIES HEREBY
provisions. AGREE THAT: (a) THE PREVAILING PARTY SHALL NOT BE ENTITLED TO
4.6 Survival of Representation RECOVER ATTORNEYS’ FEES OR COSTS ASSOCIATED WITH PURSUING THE
All representations, warranties and covenants herein shall survive the CLASS OR REPRESENTATIVE ACTION (NOT WITHSTANDING ANY OTHER
execution and delivery of this Agreement and shall continue in full force until PROVISION IN THIS AGREEMENT); AND (b) THE PARTY WHO INITIATES OR
all obligations under this Agreement shall have been satisfied in full and this PARTICIPATES AS A MEMBER OF THE CLASS WILL NOT SUBMIT A CLAIM OR
Agreement shall have terminated. OTHERWISE PARTICIPATE IN ANY RECOVERY SECURED THROUGH THE
CLASS OR REPRESENTATIVE ACTION.
4.7 Interpretation
All parties hereto have reviewed this Agreement with an attorney of their own 4.12 Facsimile & Digital Acceptance
choosing and have relied only on their own attorneys’ guidance and advice. No Facsimile signatures and digital signatures hereon shall be deemed acceptable
for all purposes.
Initial(s): _____________
Page|5 KCGVϭϬ.2ϯ
FILED: ROCKLAND COUNTY CLERK 04/11/2024 05:58 PM INDEX NO. 032018/2024
DocuSign Envelope ID: D2FB5B46-2A4D-4630-9BD9-C3DD6C1894FB
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 04/11/2024
SECURITY AGREEMENT AND GUARANTY
Business (Seller) Legal Name: _________________________________________
LOCUS DIGITAL, LLC Federal Tax ID (EIN): ___________
Doing Business As: LOCUS
_________________________________________
DIGITAL
Business Address: 5851
___________________________
LEGACY CIR FL 6 City: ________________
PLANO State: _____________
TX Zip: ________
75024
SECURITY AGREEMENT
Security Interest immediate withdrawal or freezing the Secured liable for, and Purchaser may charge and collect, all
This Security Agreement (“Security Agreement”) Assets. Purchaser shall have the right to notify costs and expenses, including but not limited to
secures all Seller’s obligations under the Revenue Seller’s account debtors at any time. Pursuant to attorney’s fees and costs of collection in the amount
Purchase Agreement (the “Agreement”). This Article 9 of the UCC, as amended from time to time, of 25% of the Purchased Amount then outstanding
Security Agreement will constitute a security Purchaser has control over and may direct the under this Agreement, which may be incurred by
agreement under the Uniform Commercial Code.
Preview
FILED: ROCKLAND COUNTY CLERK 04/11/2024 05:58 PM INDEX NO. 032018/2024 DocuSign Envelope ID: D2FB5B46-2A4D-4630-9BD9-C3DD6C1894FB NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 04/11/2024 REVENUE PURCHASE AGREEMENT Agreement dated _______________________ January 23, 2024 between Kalamata Capital Group, LLC (“Purchaser”) and the Seller(s) listed below (“Seller”) (Month) (Day) (Year) Business (Seller) Legal Name: _________________________________________________ LOCUS DIGITAL, LLC AND THE ENTITIES LISTED ON APPENDIX A Doing Business As: ___________________________________________ LOCUS DIGITAL FEIN: __________ State of Inc. / Org. : _______ TX Entity Type: __________________________ LIMITED LIABILITY COMPANY Business Address: ___________________________ 5851 LEGACY CIR FL 6 City: ________________ PLANO State: _____________ TX Zip: ________ 75024 Mailing Address: ___________________________ SAME AS ABOVE City: ________________ State: _____________ Zip: ________ Designated Email Address (for Notices): abe@locusdigital.com __________________________ (Primary) __________________________ (Secondary Optional) Purchase Price: $___________ 75,000.00 15 Purchased Percent: _____% Purchased Amount: $___________ 105,000.00 Net Funding $____________ 72,638.50 (after applicable fees set forth on Appendix B and payoff of any existing financing) Remittance Frequency: _______ WEEKLY Remittance: $ ________ 2,387.00 (Subject to adjustment – See Paragraphs 1.3 & 1.4) ________ Remittance Method (primary): ( ) Processor ( ✔) ACH PURCHASE AND SALE OF FUTURE RECEIVABLES Seller hereby sells, assigns and transfers to Seller’s business may slow down or fail, and the entire Purchased Amount. Seller hereby Purchaser (making Purchaser the absolute owner) Purchaser assumes these risks based on Seller’s authorizes Purchaser to ACH debit the Remittance in consideration of the Purchase Price specified representations, warranties and covenants in this from the Account on the Remittance Frequency, above, the Purchased Percent of all of Seller’s Agreement, which are designed to give Purchaser and, upon an Event of Default to change the future receipts, contract rights and other a reasonable and fair opportunity to receive the Remittance Frequency, in Purchaser’s sole entitlements arising from or relating to the benefit of its bargain. Seller and Guarantor(s) are discretion. The parties agree that the initial and payment of monies from Seller’s customers and/or only guaranteeing their performance of the terms final Remittances may be prorated in Purchaser’s other third party payors (the “Future Receipts” of this Revenue Purchase Agreement and are not sole discretion; as applicable, “daily” means any which include all payments made by cash, check, guaranteeing the payment of the Purchased day that is not a United States banking holiday, electronic transfer or other form of monetary Amount. The initial Remittance shall be as and ”weekly” means, as determined by Purchaser payment deposited into Seller’s bank account), for described above. The Remittance is subject to from time to time, a day, which is not a United the payments to Seller as a result of Seller’s sale adjustment as set forth in Paragraphs 1.3 and 1.4 States banking holiday, recurring every week until of goods and/or services until the Purchased to better reflect the actual Purchased Percent of the entire Purchased Amount is received by Amount has been delivered by or on behalf of the Future Receipts. Purchaser. Seller understands that it is responsible Seller to Purchaser. Seller shall select the primary method for ensuring for notifying Purchaser if the Remittance will not Purchaser’s payment of the Purchase Price shall be Remittances are received by Purchaser: Either (1) be in the Account and will be held responsible for deemed the acceptance and performance by Purchaser will debit the Remittance via ACH each any fees incurred by Purchaser resulting from a Purchaser of this Agreement. business day (“ACH Remittances”) from only rejected ACH attempt or an Event of Default. Seller is selling a portion of a future revenue one bank deposit account, which account must be Purchaser is not responsible for any overdrafts or stream to Purchaser at a discount, not borrowing acceptable to, and pre-approved by, Purchaser rejected transactions that may result from money from Purchaser; therefore, there is no (the “Account”), or (2) a credit and debit card Purchaser’s ACH debiting of the agreed interest rate or payment schedule and no time processor (the “Processor”) acceptable to Remittance under the terms of this Agreement. period during which the Purchased Amount must Purchaser shall remit all Future Receipts to a Notwithstanding anything to the contrary in this be collected by Purchaser. The Remittance is a deposit account designated by Purchaser Agreement or any other agreement between good faith estimate of the Purchased Percent (“Processor Remittances”). For ACH Purchaser and Seller, upon the occurrence of an multiplied by revenues of Seller. Seller filing Remittances, Seller and Seller’s customers shall Event of Default hereunder, the Purchased bankruptcy or going out of business, or remit all Future Receipts into the Account, until Percent shall equal 100% and the entire experiencing a slowdown in business, or a delay in such time as Purchaser receives delivery of the undelivered Purchased Amount is immediately collecting its receivables, in and of itself, does not entire Purchased Amount. Seller shall not deposit due. A list of all fees applicable under this constitute a breach of this Agreement. Purchaser any Future Receipts into any account other than Agreement is contained in Appendix B. is entering this Agreement knowing the risks that the Account until Purchaser receives delivery of THE REVENUE PURCHASE AGREEMENT “TERMS AND CONDITIONS,” THE SECURITY AGREEMENT AND GUARANTY, THE ADMINISTRATIVE FORM AND FOLLOWING PAGES, ARE ALL HEREBY INCORPORATED IN AND MADE A PART OF THIS REVENUE PURCHASE AGREEMENT. LOCUS DIGITAL, LLC SELLER: _____________________________________ AND THE ENTITIES LISTED ON APPENDIX A By: _______________________ IBRAHEEM AHMED RUBARTS _______________________ Guarantor #1: ____________________ IBRAHEEM AHMED RUBARTS __________________ (Print Name) (Signature) (Print Name) (Signature) By: _______________________ _______________________ Guarantor #2: ____________________ __________________ (Print Name) (Signature) (Print Name) (Signature) Page|1 KCGVϭϬ.2ϯ FILED: ROCKLAND COUNTY CLERK 04/11/2024 05:58 PM INDEX NO. 032018/2024 DocuSign Envelope ID: D2FB5B46-2A4D-4630-9BD9-C3DD6C1894FB NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 04/11/2024 TERMS AND CONDITIONS OF REVENUE PURCHASE AGREEMENT I. TERMS OF ENROLLMENT IN PROGRAM 1.6 Transactional History 1.1 Seller Deposit Agreement and Processor Seller shall authorize all of its banks, brokers and card processors to provide Seller shall (A) execute an agreement acceptable to Purchaser with a Bank Purchaser with Seller’s banking, brokerage and/or processing history to acceptable to Purchaser to obtain electronic fund transfer services for the determine qualification or continuation in this program and for collections Account, and (B) if applicable, execute an agreement acceptable to Purchaser purposes. Seller shall provide Purchaser with copies of any documents related with the Processor, instructing the Processor to remit all Future Receipts to a to Seller’s card processing activity or financial and banking affairs within five deposit account designated by Purchaser. If Seller selects Processor (5) calendar days after Purchaser’s request. Remittances as its primary Remittance Method, Seller shall have five (5) 1.7 Indemnification business days to ensure collections of Future Receipts and Remittances are Seller and Guarantor(s) jointly and severally indemnify and hold harmless being sent by Processor to Purchaser. Until the Purchased Amount and any Processor, its officers, directors and shareholders against all losses, damages, costs, fees or charges hereunder have been received by Purchaser, Seller shall claims, liabilities, and expenses (including reasonable attorney’s fees) incurred maintain ACH Remittances as a secondary Remittance Method. At any time by Processor resulting from (a) claims asserted by Purchaser for monies owed and to the extent that Processor Remittances are not being received by to Purchaser from Seller and (b) actions taken by Processor in reliance upon Purchaser or otherwise fail, Purchaser has the ability, without notice to Seller, any fraudulent, misleading or deceptive information or instructions provided to rely on ACH Remittances to make ACH debits necessary to receive the by Seller. amount of the Remittance agreed to herein. Seller shall provide Purchaser 1.8 No Liability and/or its authorized agent(s) with all of the information, authorizations and In no event will Purchaser be liable for any claims asserted by Seller or passwords necessary for verifying Seller’s receivables, receipts, deposits and Guarantor(s) under any legal theory for lost profits, lost revenues, lost business withdrawals into and from the Account. Seller hereby authorizes Purchaser opportunities, exemplary, punitive, special, incidental, indirect or consequential and/or its agent(s) to withdraw from the Account via ACH debit the amounts damages, each of which is waived by both Seller and Guarantor(s). In the owed to Purchaser for the receipts as specified herein and to pay such amounts event these claims are nonetheless raised, Seller and Guarantor(s) will be to Purchaser. These authorizations apply not only to the approved Account but jointly and severally liable for all of Purchaser’s attorney’s fees and expenses also to any subsequent or alternate account used by the Seller for these resulting therefrom. deposits, whether pre-approved by Purchaser or not. This additional 1.9 Third Party Beneficiaries authorization is not a waiver of Purchaser’s entitlement to declare this The parties agree that Processor and Seller’s bank are third party beneficiaries Agreement breached by Seller as a result of its usage of an account which for the purposes of Sections 1.1, 1.5, 1.6, 1.7 and 2.5 of this Agreement Purchaser did not first pre-approve in writing prior to Seller’s usage thereof. notwithstanding the fact that Processor and such bank are not parties to this The aforementioned authorizations shall be irrevocable without the written Agreement, Processor and the bank may rely upon such terms in any action. consent of Purchaser. Except as provided herein, this Agreement is for the sole benefit of the parties 1.2 No Fixed Term of Agreement hereto and their permitted successors and assigns, and nothing herein, express This Agreement shall remain in full force and effect until the entire Purchased or implied, is intended to or shall confer upon any other person or entity any Amount and any costs, fees, or charges incurred are received by Purchaser as legal or equitable right, benefit or remedy of any nature whatsoever under or per the terms of this Agreement. by reason of this Agreement. 1.3 Reconciliation 1.10 Sale of Receipts Every two calendar weeks from the date on page 1 of this Agreement, Seller Seller and Purchaser agree that the Purchase Price under this Agreement is in shall submit its bank statements and financial information to Purchaser, and exchange for the Purchased Amount, and that such Purchase Price is not Purchaser shall reconcile the amount due to Purchaser by either crediting or intended to be, nor shall it be construed as a loan from Purchaser to Seller. debiting the Account so that the total amount of Remittances equals the Seller agrees that the Purchase Price is in exchange for the Future Receipts Purchased Percent multiplied by the Seller’s collections of Future Receipts for pursuant to this Agreement, and that it equals the fair market value of such the preceding two calendar weeks period. Purchaser retains the right to Future Receipts. Purchaser has purchased and shall own all the Future Receipts request additional documentation including but not limited to bank login or described in this Agreement up to the full Purchased Amount as the Future DecisionLogic access to view Seller’s accounts. All such submissions shall be Receipts are created. Remittances made to Purchaser in respect of the sent in writing to reconciliations@kalamatacapitalgroup.com. Seller shall have Purchased Amount shall be conditioned upon Seller’s sale of products and no right to a reconciliation if an Event of Default, or other breach of this services, and the payment therefore by Seller’s customers. In no event shall Agreement, has occurred. Upon receipt of the appropriate information, the aggregate of all amounts or any portion thereof be deemed as interest Purchaser shall perform the reconciliation within 3 business days. hereunder, and in the event that it is found to be interest despite the parties 1.4 Adjustments to the Remittance specifically representing that it is NOT interest, it shall be found that no sum As long as an Event of Default, or other breach of this Agreement, has not charged or collected hereunder shall exceed the highest rate permissible at occurred, and if Seller experiences a decrease in its Future Receipts, Seller may law. In the event that a court nonetheless determines that Purchaser has submit a request to Purchaser to decrease the Remittance in accordance with charged or received interest hereunder in excess of the highest applicable rate, the procedures for reconciliation submission set forth in Section 1.3 hereof so the rate in effect hereunder shall automatically be reduced to the maximum the Remittance shall more closely reflect the Seller’s Future Receipts multiplied rate permitted by applicable law and Purchaser shall promptly refund to Seller by the Purchased Percent. Purchaser shall reconcile Remittance in accordance any interest received by Purchaser in excess of the maximum lawful rate, it with Section 1.3. being intended that Seller not pay or contract to pay, and that Purchaser not 1.5 Financial Condition receive or contract to receive, directly or indirectly in any manner whatsoever, Seller and Guarantor(s) (as hereinafter defined and limited) authorize interest in excess of that which may be paid by Seller under applicable law. As Purchaser and its agents to investigate their financial responsibility and history, a result, thereof, Seller knowingly and willingly waives the defense of usury in and will provide to Purchaser any authorizations, bank or financial statements, any action or proceeding. tax returns, etc., as Purchaser deems necessary in its sole and absolute 1.11 Power of Attorney discretion prior to or at any time after execution of this Agreement. A Seller irrevocably appoints Purchaser as its agent and attorney-in-fact with full photocopy of this authorization will be deemed as acceptable as an authority to take any action or execute any instrument or document to settle authorization for release of financial and credit information. Purchaser is all obligations due to Purchaser from Processor, or in the case of a violation by authorized to update such information and financial and credit profiles from Seller of Section 1 or the occurrence of an Event of Default under Section 3 time to time as it deems appropriate. hereof, including without limitation (i) to obtain and adjust insurance; (ii) to Page|2 KCGVϭϬ.2ϯ FILED: ROCKLAND COUNTY CLERK 04/11/2024 05:58 PM INDEX NO. 032018/2024 DocuSign Envelope ID: D2FB5B46-2A4D-4630-9BD9-C3DD6C1894FB NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 04/11/2024 collect monies due or to become due under or in respect of any of the 1.15 Publicity Collateral; (iii) to receive, endorse and collect any checks, notes, drafts, Seller and each of Seller’s Owners and all Guarantors hereto all hereby instruments, documents or chattel paper in connection with clause (i) or clause authorizes Purchaser to use its, his or her name in listings of clients and in (ii) above; (iv) to sign Seller’s name on any invoice, bill of lading, or assignment advertising and marketing materials. directing customers or account debtors to make payment directly to Purchaser; 1.16 Trade Names (v) to contact Seller’s banks and financial institutions using Seller and Seller hereby acknowledges and agrees that Purchaser may be using trade Guarantor(s) personal information to verify the existence of an account and names, “doing business as”, or “d/b/a” names in connection with various obtain account balances; (vi) to file any claims or take any action or institute matters relating to the transaction between Purchaser and Seller, including the any proceeding which Purchaser may deem necessary for the collection of any filing of UCC-1 financing statements and other notices or filings. of the undelivered Purchased Amount from the Collateral, or otherwise to enforce its rights with respect to delivery of the Purchased Amount. In II. REPRESENTATIONS, WARRANTIES AND COVENANTS Seller represents warrants and covenants that, as of this date and, unless connection therewith, all costs, expenses and fees, including legal fees, shall expressly stated otherwise, during the course of this Agreement: be payable by Seller. 1.12 Interference with Receipts 2.1 Financial Condition and Financial Information Seller’s and Guarantors’ bank and financial statements, copies of which have Seller agrees that it will not engage in or voluntarily permit the following been furnished to Purchaser, and future statements which will be furnished actions and acknowledges that each of the following is an Event of Default: hereafter upon Purchaser’s request, fairly represent the financial condition of (a) Seller takes any action to discourage the use of electronic check processing Seller at such dates, and since those dates there has been no material adverse that are settled through Processor, or permits any event to occur that could changes, financial or otherwise, in such condition, operation or ownership of have an adverse effect on the use, acceptance, or authorization of checks or Seller. Seller and Guarantors have a continuing, affirmative obligation to advise other payments or deposits for the purchase of Seller’s services and products, Purchaser of any material adverse change in their financial condition, operation including but not limited to, direct deposit of any checks into a bank account or ownership. Purchaser may request statements at any time during the without scanning into the Purchaser electronic check processor; (b) Seller performance of this Agreement and the Seller and Guarantors shall provide changes its arrangements with Processor or its bank in any way that is adverse them to Purchaser within five business days after request from Purchaser. or unacceptable to Purchaser; (c) Seller changes the electronic check processor Seller’s or Guarantors’ failure to do so is a material breach of this Agreement. through which the Receipts are settled from Processor to another electronic check processor, or permits any event to occur that could cause diversion of 2.2 Governmental Approvals any of Seller’s check or deposit transactions to another processor; (d) Seller Seller is in compliance and shall comply with all laws and has valid permits, intentionally interrupts the operation of this business, transfers, moves, sells, authorizations and licenses to own, operate and lease its properties and to disposes, or otherwise conveys its business and/or assets without (i) the conduct the business in which it is presently engaged and/or will engage in express prior written consent of Purchaser, and (ii) the written agreement of hereafter. Purchaser or its transferee to the assumption of all of Seller’s obligations under 2.3 Authorization this Agreement pursuant to documentation satisfactory to Purchaser; (e) Seller Seller, Guarantor(s) and the person(s) signing this Agreement on behalf of takes any action, fails to take any action, or offers any incentive—economic or Seller, have full power and authority to incur and perform the obligations under otherwise—to induce any customer(s) to pay for Seller’s services with any this Agreement, all of which have been duly authorized. means other than payments, checks or deposits that are settled through 2.4 Use of Funds Processor; or (f) Seller fails to provide Purchaser with copies of any documents Seller and Guarantor(s) agree that it shall use the Purchase Price for business related to Seller’s card processing activity of financial and banking affairs within purposes, that Seller is receiving the Purchase Price and selling Purchaser the five calendar days after a request from Purchaser. Purchased Amount in good faith and will use the Purchase Price funds to These protections are in addition to any other remedies available to maintain and grow Seller’s business and not for personal, family, or household Purchaser at law, in equity or otherwise pursuant to this purposes. Agreement. 2.5 Electronic Payment Processing Agreement 1.13 Protection of Information Seller will not change Processor, add terminals or use other equipment to Seller and each person signing this Agreement on behalf of Seller and/or as process credit and debit card payments, change its financial institution or bank Owner or Guarantor, in respect of himself or herself personally, authorizes account(s) or take any other action that could have any adverse effect upon Purchaser to disclose information concerning Seller’s and each Owner’s and Seller’s obligations under this Agreement, without Purchaser’s prior written each Guarantor’s credit standing (including credit bureau reports that consent. Any such changes shall be a material breach of this Agreement. Purchaser obtains) and business conduct only to agents, affiliates, subsidiaries, 2.6 Change of Name or Location and credit reporting bureaus. Seller and each Owner and each Guarantor Seller will not conduct Seller’s businesses under any name other than as hereby and each waives to the maximum extent permitted by law any claim disclosed to the Processor and Purchaser, nor shall Seller change any of its for damages against Purchaser or any of its affiliates relating to any (i) places of business without prior written consent by Purchaser. investigation undertaken by or on behalf of Purchaser as permitted by this 2.7 Daily Batch Out Agreement or (ii) disclosure of information as permitted by this Agreement. Seller will batch out receipts with Processor on a daily basis if applicable. 1.14 Confidentiality 2.8 Estoppel Certificate Seller understands and agrees that the terms and conditions of the products Seller will at every and all times, and from time to time, upon at least one (1) and services offered by Purchaser, including this Agreement and any other day’s prior notice from Purchaser to Seller, execute, acknowledge and deliver Purchaser documents (collectively, “Confidential Information”) are to Purchaser and/or to any other person, firm or corporation specified by proprietary and confidential information of Purchaser. Accordingly, unless Purchaser, a statement certifying that this Agreement is unmodified and in full disclosure is required by law or court order, Seller shall not disclose force and effect (or, if there have been modifications, that the same is in full Confidential Information of Purchaser to any person other than an attorney, force and effect as modified and stating the modifications) and stating the accountant, financial advisor or employee of Seller who needs to know such dates which the Purchased Amount or any portion thereof has been repaid. information for the purpose of advising Seller (“Advisor”), provided such 2.9 No Bankruptcy Advisor uses such information solely for the purpose of advising Seller and first As of the date of this Agreement, Seller is not insolvent and does not agrees in writing to be bound by the terms of this Section. A breach hereof contemplate filing for bankruptcy in the next six months and has not consulted entitles Purchaser to not only damages and reasonable attorney’s fees but also with a bankruptcy attorney or filed any petition for bankruptcy protection under to both a temporary restraining order and a preliminary injunction without Title 11 of the United States Code and there has been no involuntary petition bond or security. brought or pending against Seller. Seller further warrants that it does not Page|3 KCGVϭϬ.2ϯ FILED: ROCKLAND COUNTY CLERK 04/11/2024 05:58 PM INDEX NO. 032018/2024 DocuSign Envelope ID: D2FB5B46-2A4D-4630-9BD9-C3DD6C1894FB NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 04/11/2024 anticipate filing any such bankruptcy petition and it does not anticipate that an 3.4 Remedies involuntary petition will be filed against it. If any Event of Default occurs, Purchaser may proceed to protect and enforce 2.10 Unencumbered Receipts its rights or remedies by suit in equity or by action at law, or both, whether for Seller has, and will have, good, complete, unencumbered and marketable title the specific performance of any covenant, agreement or other provision to all Future Receipts, free and clear of any and all liabilities, liens, claims, contained herein, or to enforce Seller’s obligations hereunder (including the changes, restrictions, conditions, options, rights, mortgages, security interests, Guaranty) or any other legal or equitable right or remedy and enforcing the equities, pledges and encumbrances of any kind or nature whatsoever or any Security Agreement contained herein. All rights, powers and remedies of other rights or interests that may be inconsistent with the transactions Purchaser in connection with this Agreement may be exercised at any time by contemplated with, or adverse to the interests of, Purchaser. Purchaser after the occurrence of an Event of Default, are cumulative and not 2.11 Business Purpose exclusive, and shall be in addition to any other rights, powers or remedies Seller is a valid business in good standing under the laws of the jurisdictions provided by law or equity. Additionally, and in no way limiting any other in which it is organized and/or operates, and Seller is entering into this available remedies, if any Event of Default occurs, immediately and with or Agreement for business purposes and not as a consumer for personal, family without notice unless otherwise required by law: or household purposes. (a) The full uncollected Purchased Amount becomes due and payable in full 2.12 Defaults under Other Contracts immediately, and all fees (including reasonable attorney’s fees and costs of Seller’s execution of, and/or performance under this Agreement, will not cause collection in the amount of 25% of the Purchased Amount then outstanding) or create an event of default by Seller under any contract with another person due under this Agreement and the attached Security Agreement become due or entity. and payable in full immediately; (b) Purchaser may enforce the provisions of the Guaranty of Performance III. EVENTS OF DEFAULT AND REMEDIES against the Guarantor(s); 3.1 Events of Default (c) Purchaser may enforce its security interest in the Collateral; The occurrence of any of the following events shall constitute an “Event of (d) Purchaser may proceed to protect and enforce its right and remedies by Default” hereunder: lawsuit. In any such lawsuit, if Purchaser recovers a judgment against Seller, (a) Seller or any Guarantor shall violate any term or covenant in this Seller shall be liable for all of Purchaser’s costs of the lawsuit, including but not Agreement, its guaranty or any agreement with Processor; limited to all reasonable attorneys’ fees and costs of collection in the amount (b) Any representation or warranty by Seller or Guarantor in this Agreement, of 25% of the Purchased Amount then outstanding under this Agreement. or its guaranty, as applicable shall prove to have been incorrect, false or Upon breach of any provision in this Agreement, Purchaser may exercise its misleading in any material respect when made; rights under the assignment of Lease without prior notice to Seller. Purchaser (c) The sending of notice of termination by Seller or verbally notifying may debit Seller’s depository accounts wherever situated by means of ACH Purchaser of its intent to breach this Agreement; debit or facsimile signature on a computer-generated check drawn on Seller’s (d) Seller fails to give Purchaser 24 hours advance notice that there will be bank account or otherwise for all sums due to Purchaser. insufficient funds in the account such that the ACH of the Remittance will not 3.5 Costs be honored by Seller’s bank; Seller shall pay to Purchaser all reasonable costs associated with (a) an Event (e) Seller fails, within 2 business days of Purchaser’s request, to supply all or Default, (b) breach by Seller of the representations, warranties or covenants requested documentation and allow for daily and/or real time monitoring of in this Agreement and the enforcement thereof, and (c) the enforcement of the Account; Purchaser‘s remedies set forth in this Agreement, including but not limited to (f) Seller shall, or shall enter into any agreement to, transfer or sell, all or attorneys’ fees and costs of collection in the amount of 25% of the Purchased substantially all of its assets; Amount then outstanding under this Agreement. (g) Seller shall make or send notice of any intended bulk sale or transfer by 3.6 Required Notifications Seller; Seller is required to give Purchaser written notice within 24 hours of any filing (h) Seller shall use multiple depository accounts without the prior written under Title 11 of the United States Code. Seller is required to give Purchaser consent of Purchaser; five business days’ written notice prior to the closing of any sale of all or (i) Seller shall enter into any financing agreements with any other party substantially all of the Seller’s assets or stock. including but not limited to loans, merchant cash advances, receivables financing, or any other agreement that will increase the total debt or IV. MISCELLANEOUS remittances owed by Seller to any other party; 4.1 Modifications; Agreements (j) Seller shall change the Account or Processor without the prior written No modification, amendment, waiver or consent of any provision of this consent of Purchaser; Agreement shall be effective unless the same shall be in writing and signed by (k) Seller’s bank returns a code other than NSF preventing Purchaser from Purchaser. initiating ACH Remittances or collecting Future Receipts; or 4.2 Successors and Assigns (l) Seller shall default under any of the terms, covenants and conditions of any Purchaser may assign, transfer or sell any or all its rights under this Agreement, other agreement with Purchaser. or its right to receive the Purchased Amount or delegate its duties hereunder, 3.2 Bankruptcy Not Default either in whole or in part, with or without prior written notice to Seller. This Notwithstanding any other provision of this Agreement, filing for bankruptcy, Agreement shall be binding upon and inure to the benefit of Seller, Purchaser becoming insolvent, or winding up the Seller’s business for financial reasons is and their respective successors and assigns, except that Seller shall not have not a breach of this Agreement or an Event of Default, so long as Seller the right to assign its rights hereunder or any interest herein without the prior complies with the other terms of this Agreement. These other terms include, written consent of Purchaser which consent may be withheld in Purchaser’s for example, the continuing affirmative obligation to advise Purchaser of any sole discretion. material adverse change in Seller’s financial condition, operation or ownership, 4.3 Notices as required by Section 2.1. All notices, requests, consents, demands and other communications hereunder 3.3 Personal Guaranty shall be delivered by (1) certified mail, return receipt requested, or (2) email, Seller agrees and acknowledges that if an Event of Default occurs, Purchaser to the respective parties to this Agreement at the addresses set forth in this will enforce its rights against the Guarantor(s). Upon such Event of Default, Agreement. Notices to Purchaser shall become effective only upon receipt by said Guarantor(s) will be jointly and severally liable to Purchaser for all of Purchaser. Notices to Seller shall become effective three days after mailing, or Purchaser’s losses and damages, in addition to all costs and expenses and legal immediately if by email. Notices that the Account does not contain sufficient fees associated with such enforcement. funds, however, must be made by email to the following address: customerservice@kalamatacapitalgroup.com. Page|4 KCGVϭϬ.2ϯ FILED: ROCKLAND COUNTY CLERK 04/11/2024 05:58 PM INDEX NO. 032018/2024 DocuSign Envelope ID: D2FB5B46-2A4D-4630-9BD9-C3DD6C1894FB NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 04/11/2024 4.4 Waiver Remedies construction determinations shall be made against either party hereto as No failure on the part of Purchaser to exercise, and no delay in exercising any drafter. right under this Agreement shall operate as a waiver thereof, nor shall any 4.8 Severability single or partial exercise of any right under this Agreement preclude any other In case any of the provisions in this Agreement is found to be invalid, illegal or or further exercise thereof or the exercise of any other right. The remedies unenforceable in any respect, the validity, legality and enforceability of any provided hereunder are cumulative and not exclusive of any remedies provided other provision contained herein shall not in any way be affected or impaired. by law or equity. 4.9 Entire Agreement 4.5 Governing Law, Venue and Jurisdiction Any provision hereof prohibited by law shall be ineffective only to the extent This Agreement, Security Agreement and Guaranty of Performance, and any of such prohibition without invalidating the remaining provisions hereof. This and all addendums, attachments, exhibits and other documents relating to this Agreement, the Security Agreement and Guaranty hereto embody the entire Agreement shall be governed by and construed in accordance with the laws of agreement between Seller and Purchaser and supersede all prior agreements the state of New York, without regards to any applicable principals of conflicts and understandings relating to the subject matter hereof. of law. Any suit, action or proceeding arising hereunder, or the interpretation, 4.10 JURY TRIAL WAIVER performance or breach hereof, shall, if Purchaser so elects, be instituted in any THE PARTIES HERETO WAIVE TRIAL BY JURY IN ANY COURT IN ANY SUIT, court sitting in New York (the “Acceptable Forums”). Seller and Guarantor(s) ACTION OR PROCEEDING ON ANY MATTER ARISING IN CONNECTION WITH agree that the Acceptable Forums are convenient and submit to the jurisdiction OR IN ANY WAY RELATED TO THE TRANSACTIONS OR THE ENFORCEMENT of the Acceptable Forums and waive any and all objections to jurisdiction or HEREOF. THE PARTIES HERETO ACKNOWLEDGE THAT EACH MAKES THIS venue. If such proceeding be initiated in any other forum, Seller and WAIVER KNOWINGLY, WILLINGLY AND VOLUNTARILY AND WITHOUT Guarantor(s) waive any right to oppose any motion or application made by DURESS, AND ONLY AFTER EXTENSIVE CONSIDERATION OF THE Purchaser to transfer such proceeding to an Acceptable Forum. RAMIFICATIONS OF THIS WAIVER WITH THEIR ATTORNEYS. Seller and Guarantor(s) hereby agree to waive their right to service of 4.11 CLASS ACTION WAIVER process as prescribed by New York Civil Practice Law and Rules. Seller THE PARTIES HERETO WAIVE ANY RIGHT TO ASSERT ANY CLAIMS AGAINST and Guarantor(s) further agree that the mailing by certified or registered THE OTHER PARTY AS A REPRESENTATIVE OR MEMBER IN ANY CLASS OR mail, return receipt requested to the Mailing Address listed in this REPRESENTATIVE ACTION, EXCEPT WHERE SUCH WAIVER IS PROHIBITED Agreement, of any process required by any such court will constitute valid BY LAW AS AGAINST PUBLIC POLICY. TO THE EXTENT EITHER PARTY IS and lawful service of process against them without the necessity for PERMITTED BY LAW OR COURT OF LAW TO PROCEED WITH A CLASS OR service by any other means provided by statute or rule of court, but without invalidating service performed in accordance with such other REPRESENTATIVE ACTION AGAINST THE OTHER, THE PARTIES HEREBY provisions. AGREE THAT: (a) THE PREVAILING PARTY SHALL NOT BE ENTITLED TO 4.6 Survival of Representation RECOVER ATTORNEYS’ FEES OR COSTS ASSOCIATED WITH PURSUING THE All representations, warranties and covenants herein shall survive the CLASS OR REPRESENTATIVE ACTION (NOT WITHSTANDING ANY OTHER execution and delivery of this Agreement and shall continue in full force until PROVISION IN THIS AGREEMENT); AND (b) THE PARTY WHO INITIATES OR all obligations under this Agreement shall have been satisfied in full and this PARTICIPATES AS A MEMBER OF THE CLASS WILL NOT SUBMIT A CLAIM OR Agreement shall have terminated. OTHERWISE PARTICIPATE IN ANY RECOVERY SECURED THROUGH THE CLASS OR REPRESENTATIVE ACTION. 4.7 Interpretation All parties hereto have reviewed this Agreement with an attorney of their own 4.12 Facsimile & Digital Acceptance choosing and have relied only on their own attorneys’ guidance and advice. No Facsimile signatures and digital signatures hereon shall be deemed acceptable for all purposes. Initial(s): _____________ Page|5 KCGVϭϬ.2ϯ FILED: ROCKLAND COUNTY CLERK 04/11/2024 05:58 PM INDEX NO. 032018/2024 DocuSign Envelope ID: D2FB5B46-2A4D-4630-9BD9-C3DD6C1894FB NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 04/11/2024 SECURITY AGREEMENT AND GUARANTY Business (Seller) Legal Name: _________________________________________ LOCUS DIGITAL, LLC Federal Tax ID (EIN): ___________ Doing Business As: LOCUS _________________________________________ DIGITAL Business Address: 5851 ___________________________ LEGACY CIR FL 6 City: ________________ PLANO State: _____________ TX Zip: ________ 75024 SECURITY AGREEMENT Security Interest immediate withdrawal or freezing the Secured liable for, and Purchaser may charge and collect, all This Security Agreement (“Security Agreement”) Assets. Purchaser shall have the right to notify costs and expenses, including but not limited to secures all Seller’s obligations under the Revenue Seller’s account debtors at any time. Pursuant to attorney’s fees and costs of collection in the amount Purchase Agreement (the “Agreement”). This Article 9 of the UCC, as amended from time to time, of 25% of the Purchased Amount then outstanding Security Agreement will constitute a security Purchaser has control over and may direct the under this Agreement, which may be incurred by agreement under the Uniform Commercial Code.