Preview
D O RA OUN PK O6 PIV INDEX NO. EF004733-2024
NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 06/12/2024
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF ORANGE
FINWISE BANK,
Plaintiff, STATEMENT FOR JUDGMENT
- against - Index No.: EF004733-2024
REACHING GOALS INC.,
Defendant.
AS AND FOR ITS JUDGMENT AGAINST DEFENDANT REACHING GOALS INC.,
IN CONNECTION WITH THEIR AFFIDAVIT OF JUDGMENT BY CONFESSION DATED
MARCH 3, 2023, PLAINTIFF FINWISE BANK HEREBY STATES:
Amount of Confession of Judgment through June 12, 2024 as $340,378.40
Per Affidavit of Timothy S. Brosnat
Costs by Statute CPLR § 3218 $15.00
Fee for Index No. + ___ $210.00
Total Costs and Disbursements $225.00
TOTAL JUDGMENT $340,603.40
LEMERY GREISLER LLC, attorneys of record for the Plaintiff herein, states that the
within Judgment has been confessed pursuant to Defendant’s Affidavit of Judgment by Confession
dated March 3, 2023, and which is supported by the Affidavit of Timothy S. Brosnan in Support
of Entry of Confession of Judgment, sworn to on June 12, 2024, all of which are being
simultaneously submitted herewith, and
The undersigned, an attorney admitted to practice in the State of New York, and an attomey
of record for plaintiff in the above-entitled action, affirms under penalties of perjury and states that
the costs and disbursements specified herewith have been or will necessarily be made or incurred
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Filed in Orange County 06/12/2024 03:51:20 PM Bk:5168 38 Pg: 532 Index: # EF004733-2024
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and are reasonable in amount.
Dated: June 12, 2024
Meghan M. Breen, Esq.
Costs and disbursements taxed at $ COSTS TAXED @ $ 225.00
deat Clwackpreten
ACTING DEPUTY COUNTY CLERK
Clerk
NOW on filing the foregoing affidavit of confession of judgment, sworn to by the
Defendant on March 3, 2023, it is
ADJUDGED that plaintiffs FinWise Bank, have judgment and recover of defendant
Reaching Goals Inc. in the sum of $340,378.40, together with costs and disbursements as taxed by
the clerk in the sum of $225.00, amounting in all to the sum of $340603.40 , plus interest
at 9% per year from the date of this Judgment, and that the Plaintiff have execution therefor.
eater Gtlwakprter
Dated: 06/12/2024
ACTING DEPUTY COUNTY CLERK
, 2024
Clerk
Plaintiff’s Address
FinWise Bank
756 East Winchester St., Suite 100
Murray, Utah 84107
Defendant’s Addresses
Reaching Goals Inc.
3 Toby Place
Monsey, New York 10952
Reaching Goals Inc.
55 Carlton Road
Monsey, New York 10952
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SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF ORANGE
=.
FinWise Bank,
AFFIDAVIT FOR JUDGMENT
Judgment Creditor/Plaintiff, BY CONFESSION (CPLR § 3218)
~against- Index No. EF004733-2024
Reaching Goals Inc.,
Judgment Debtor/Defendant.
enwennnes:
STATE OF NEW YORK
SS.
COUNTY OF ORANGE ;
Shlome Ekstein, being duly sworn, deposes and says
1. Tam the duly authorized President of Reaching Goals Inc. (the “Borrower”) the Defendant in the above
entitled action.
Judgment Creditor, FinWise Bank (“FinWise”), is hereby authorized to use this Affidavit for Confession
of Judgment, which is provided pursuant to Civil Practice Law and Rule §3218, to enter judgment against
me as the Judgment Debtor in the event of a default under the loan documents listed below, for the sum
of Three Hundred Fifty Thousand and 00/100 Dollars ($350,000.00), plus interest and less all
payments received and applied by FinWise towards payment of the loan balance in accordance with the
provisions of the Note and other loan documents.
The amount for which judgment is confessed arises out of the loan relationship between Borrower and
FinWise Bank pursuant to the loan documents referenced below.
Note in the original principal sum of $350,000.00- Exhibit “A”
Security Agreement — Exhibit “B”
Loan and Security Agreement
— Exhibit “C”
Guaranty ~ Exhibit “D”
Disclosure for Confession of Judgment — Exhibit “E”
Borrower has a principal place of business at 3 Toby Place, Monroe, New York 10950 in Orange
County, New York.
I currently reside at 3 Karlin Blvd., Unit 104, Monroe, New York 10950 and authorize entry of judgment
in Orange County, New York.
Thereby authorize and empower FinWise, any of its representatives or attorneys to enter judgment against
me as Judgment Debtor under the terms confessed in this affidavit in Orange County, New York.
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This affidavit is not: given to secure FinWise against a contingent liability and does not relate to a
transaction referenced in Civil Practice Law and Rule 3201.
The sum confessed is due and payable and does not exceed the amount of the liability under the
aforementioned loan documents,
I acknowledge and affirm that I have had a full and fair opportunity to consult with an attorney of my
choice prior to executing this affidavit.
10. 1 acknowledge and affirm that I have been advised that this affidavit will, upon a default in payment
under the Note, allow FinWise to enter judgment against Borrower without notice.
li I further acknowledge and affirm that I have been advised that once judgment has been entered, FinWise
may enforce the judgment in accordance with law which may include restraint and seizure of Judgment
Debtor’s assets and other remedies as the law provides.
12. I further acknowledge and affirm that FinWise’s rights to other remedies pursuant to the parties’ loan
documents and at law are not waived and are reserved to the fullest extent the law allows.
8Kiome Ekstein, President
ACKNOWLEDGMENT
State of New York )
)ss.:
County of Orange )
On March 3, 2023 ,before me, the undersigned, personally appeared Shiome Ekstein, personally known
to me or proved to me on the basis of satisfactory evidence to be the individual whose name is
subscribed to the within instrument and acknowledged to me that he executed the same in his capacity,
and that by his signature on the instrument, the individual, or the person, or entity upon behalf of which
the individual acted, executed the instrument.
RENEE CHEVONNE SWANN
Notary Public - State of New York
NO, 018W6409553
Qualified in Rocktand County
My Commission Expires Sep. 28, 2024
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Exhibit A
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U.S. Small Business Administration
a U.S. Small Business Administration
S NOTE
SBA Loan # a
SBA Loan Name Reaching Goals Inc.
Date March 3, 2023
Loan Amount $350,000.00
Interest Rate 10.25% (Wall Street Journal Prime + 2.75%), variable, adjusted eyery calendar quarter
Borrower Reaching Goals Inc,
Operating N/A
Company
Lender FinWise Bank
1... PROMISE TO PAY:
an:
In return for the Loan, Borrower promises to pay to the order of Lender the amount of Three Hundred Fifty Thousand
10/100 Dollars ($350,000.00), interest on the unpaid principal balance, and all other amounts required by this Note.
DEFINITIONS:
!
“Collateral” means any property taken as security for payment of this Note or any guarantee of this Note,
“Guarantor” means each person or entity that signs @ guarantee of payment of this Note.
*Léan" means the loan evidenced by this Note,
pledges
"Loan Documents" means the documents related to this loan signed by Borrower, any Guarantor, or anyone who
collateral.
"SBA" means the Small Business Administration, an Agency of the United States of America.
3, PAYMENT TERMS:
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Borrower must make all payments at the place Lender designates. The payment terms for this Note are:
The interest rate on this Note will fluctuate. The initial interest rate is 10.25% per year. This initial rate is the Prime
Rate in effect on the first business day of the month in which SBA received the loan application, plus 2.75%. The initial
interest rate must remain in effect until the first change period begins unless changed in accordance with SOP 50 10.
Borrower must pay principal and interest payments of $4,673.87 every month, beginning one month from the month this
Note is dated; payments must be made on the fifth calendar day in the months they are due.
to
Lender will apply each installment payment first to pay interest accrued to the day Lender receives the payment, then
bring principal current, then to pay any late fees, and will apply any remaining balance to reduce principal.
of first rate
The interest rate, will be adjusted every calendar quarter (the "change period") beginning April 1, 2023 (date
adjustment).
in the Wall Street
The “Prime Rate” is the Prime Rate in effect on the first business day of the month (as published
the first day of the month in which any interest rate change
Journal newspaper) in which SBA received the application, or
with .004 being rounded down and 005 being rounded up.
occurs. Base Rates will be rounded to two decimal places
on the first calendar
The adjusted interest rate will be 2.75% abo ve the Prime Rate, Lender will adjust the interest rate
Lender gives Borrower notice of
day of each change period. The change in interest rate is effective on that day whether or not
the change.
changed in accordance with
The interest rate identified in the Note may not be changed during the life of the Loan unless
SOP 50 10.
The interest rate adjustment period may only be changed in accordance with SOP 50 10.
remaining term of the
Lender must adjust the payment amount at least annually as needed to amortize principal over the
note..
at the rate in
If SBA purchases the guaranteed portion of the unpaid principal balance, the interest rate becomes fixed
payment default, the rate becomes fixed at the
effect at the time of the earliest uncured payment default. If there is no uncured
rate in effect at the time of purchase.
Loan Prepayment:
Notwithstanding any provision of this Note to the contrary:
at any time without
Borrower may prepay this Note. Borrower may prepay 20 percent or less of the unpaid principal balance
on the secondary market, Borrower must:
notice. If Borrower prepays more than 20 percent and the Loan has been sold
A. Give Lender written notice;
B. Pay all accrued interest; and
equal to 21 days’
C. If the prepayment is received less than 21 days from the date Lender receives the notice, pay an amount
and paid under subparagraph B
interest from the date lender receives the notice, less any interest accrued during the 21 days
above.
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If Borrower does not prepay within 30 days from the date Lender receives the notice, Borrower must give Lender anew
notice.
All remaining principal and accrued interest is due and payable 10 years from date of Note.
Late Charge: Ifa payment on this Note is more than 10 days late, Lender may charge Borrower a late fee of up to 5% of the
unpaid portion of the regularly scheduled payment.
4. DEFAULT:
Borrower is in default under this Note if Borrower does not make a payment when due under this Note, or if Borrower or
Operating Company:
A. Fails to do anything required by this Note and other Loan Documents;
B. Defaults on any other loan with Lender;
C. Does not preserve, or account to Lender's satisfaction for, any of the Collateral or its proceeds;
D. Does not disclose, or anyone acting on their behalf does not disclose, any material fact to Lender or SBA;
E. Makes, or anyone acting on their behalf makes, a materially false or misleading representation to Lender or SBA;
F, Defaults on any loan or agreement with another creditor, if Lender believes the default may materially affect
Borrower's ability to pay this Note;
G. Fails to pay any taxes when due;
H. Becomes the subject of a proceeding under any bankruptcy or insolvency law;
I. Has a receiver or liquidator appointed for any part of their business or property;
J, Makes an assignment for the benefit of creditors;
K. Has any adverse change in financial condition or business operation that Lender believes may materially affect
Borrower's ability to pay this Note;
L, Reorganizes, merges, consolidates, or otherwise changes ownership or business structure without Lender's prior
written consent; or
M. Becomes the subject of a civil or criminal action that Lender believes may materially affect Borrower's ability to pay
this Note,
5, LENDER'S RIGHTS IF THERE IS A DEFAULT:
Without notice or demand and without giving up any of its rights, Lender may:
A. Require immediate payment of all amounts owing under this Note;
B. Collect all amounts owing from any Borrower or Guarantor;
C. File suit and obtain judgment;
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D. Take possession of any Collateral; or
E. Sell, lease, or otherwise dispose of, any Collateral at public or private sale, with or without advertisement.
6. LENDER'S GENERAL POWERS:
Without notice and without Borrower's consent, Lender may:
A, Bid on or buy the Collateral at its sale or the sale of another lienholder, at any price it chooses;
B. Incur expenses to collect amounts due under this Note, enforce the terms of this Note or any other Loan Document,
and preserve or dispose of the Collateral. Among other things, the expenses may include payments for property taxes,
prior liens, insurance, appraisals, environmental remediation costs, and reasonable attorney's fees and costs. If Lender
incurs such expenses, it may demand immediate repayment from Borrower or add the expenses to the principal balance;
C. Release anyone obligated to pay this Note;
D. Compromise, release, renew, extend or substitute any of the Collateral; and
E, Take any action necessary to protect the Collateral or collect amounts owing on this Note.
7. WHEN FEDERAL LAW APPLIES:
When SBA is the holder, this Note will be interpreted and enforced under federal law, including SBA regulations.
Lender or SBA may use state or local procedures for filing papers, recording documents, giving notice, foreclosing liens,
and other purposes. By using such procedures, SBA does not waive any federal immunity from state or local control,
penalty, tax, or liability: As to this Note, Borrower may not claim or assert against SBA any local or state law to deny
any obligation, defeat any claim of SBA, or preempt federal Jaw.
8, SUCCESSORS AND ASSIGNS:
Under this Note, Borrower and Operating Company include the successors of each, and Lender includes its successors
and assigns.
9, GENERAL PROVISIONS:
A. All individuals and entities signing this Note are jointly and severally liable.
B, Borrower waives all suretyship defenses.
C. Borrower must sign all documents necessary at any time to comply with the Loan Documents and to enable Lender to
acquire, perfect, or maintain Lender's liens on Collateral.
D. Lender may exercise any of its rights separately or together, as many times and in any order it chooses.. Lender may
delay or forgo enforcing any of its rights without giving up any of them.
E, Borrower may not use an oral statement of Lender or SBA to contradict or alter the written terms of this Note.
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F. If any part of this Note is unenforceable, all other parts remain in effect.
G. To the extent allowed by law, Borrower waives all demands and notices in connection with this Note, including
presentment, demand, protest, and notice of dishonor. Borrower also waives any defenses based upon any claim that
Lender did not obtain any guarantee; did not obtain, perfect, or maintain a lien upon Collateral; impaired Collateral; or
did not obtain the fair market value of Collateral at a sale.
10. STATE-SPECIFIC PROVISIONS:
POWER TO CONFESS JUDGMENT. UPON THE OCCURRENCE OF A DEFAULT, BORROWER HEREBY
‘AUTHORIZES ANY ATTORNEY DESIGNATED BY LENDER OR ANY CLERK OF ANY COURT OF RECORD
TO APPEAR FOR BORROWER IN ANY COURT OF RECORD AND CONFESS JUDGMENT WITHOUT PRIOR
HEARING AGAINST BORROWER IN FAVOR OF LENDER FOR, AND IN THE AMOUNT OF, THE UNPAID
BALANCE OF THE PRINCIPAL AMOUNT OF THE NOTE, ALL INTEREST ACCRUED AND UNPAID
THEREON, ALL OTHER AMOUNTS PAYABLE BY BORROWER TO LENDER UNDER THE TERMS OF THIS
NOTE OR ANY OTHER AGREEMENT, DOCUMENTS, INSTRUMENT EVIDENCING, SECURING OR
GUARANTYING THE OBLIGATION EVIDENCED BY THIS NOTE COST OF SUIT, AND ALL REASONABLE
ATTORNEYS’ FEES ACTUALLY INCURRED BY LENDER IN CONNECTION WITH ENFORCING ANY OF
THE RIGHTS OR REMEDIES HEREUNDER. IT IS THE EXPRESS INTENT OF THE PARTIES HERETO
THAT EVEN AFTER ONE OR MORE CONFESSED JUDGMENTS ARE ENTERED PURSUANT TO THIS NOTE
THAT LENDER SHALL RETAIN THE RIGHT TO COLLECT AND CONFESS JUDGMENT FOR:
ATTORNEYS’ FEES, EXPENSES AND COSTS ACTUALLY INCURRED IN CONNECTION WITH THE
COLLECTION OF THIS NOTE; ATTORNEYS’ FEES, EXPENSES AND COSTS ACTUALLY INCURRED TO
DEFEND ITSELF FROM ANY CLAIMS ARISING IN CONNECTION WITH THIS NOTE OR RELATED
DOCUMENTS; ATTORNEYS’ FEES, EXPENSES AND COSTS ACCTUALLY INCURRED IN PROTECTING
LENDER’S COLLATERAL AND INTEREST (COLLECTIVELY THE “POST JUDGMENT COSTS”). IT 1S
ALSO THE EXPRESS INTENT OF THE PARTIES HERETO THAT LENDER’S ABILITY AND RIGHT TO
COLLECT FROM AND CONFESS JUDGMENT AGAINST BORROWER FOR ALL AMOUNTS DUE
HEREUNDER, INCLUDING, WITHOUT LIMITATION, POST JUDGMENT COSTS, SHALL NOT MERGE
INTO ANY JUDGMENT OR JUDGMENTS IN FAVOR OF LENDER. FURTHERMORE, IT IS THE EXPRESS
INTENT OF THE PARTIES HERETO THAT: THE LENDER’S ABILITY AND RIGHT TO COLLECT FROM
AND CONFESS JUDGMENT AGAINST BORROWER, SHALL CONTIUNE UNDIMINISHED UNTIL LENDER
HAS RECEIVED PAYMENT IN: FULL OF ALL AMOUNTS DUE HEREUNDER, INCLUDING, WITHOUT
LIMTIATION, ALL POST JUDGMENT COSTS.
BORROWER HEREBY RELEASES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ALL ERRORS
AND ALL RIGHTS OF EXEMPTION, APPEAL, STAY OF EXECUTION, INQUISITION, AND OTHER RIGHTS
TO WHICH THE BORROWER MAY OTHERWISE BE ENTITLED TO UNDER THE LAWS OF THE UNITED
STATES OR OF ANY STATE OR POSSESSION OF THE UNITED STATES NOW IN FORCE AND WHICH MAY
HEREAFTER BE ENACTED. THE AUTHORITY AND POWER TO APPEAR FOR AND ENTER JUDGMENT
AGAINST BORROWER SHALL NOT BE EXHAUSTED BY ONE OR MORE EXERCISES THEREOF OR BY
ANY IMPERFECT EXERCISE THEREOF AND SHALL NOT BE EXTINGUISHED BY ANY JUDGMENT
ENTERED PURSUANT THERETO. SUCH AUTHORITY MAY BE EXERCISED ON ONE OR MORE
OCCASIONS OR FROM TIME TO TIME IN THE SAME OR DIFFERENT JURISDICTIONS AS OFTEN AS
LENDER SHALL: DEEM NECESSARY OR DESIRABLE, FOR ALL OF WHICH THIS NOTE SHALL BE A
SUFFICIENT WARRANT.
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11, BORROWER'S NAME(S) AND SIGNATURE(S):
By signing below, each individual or entity becomes obligated under this Note as Borrower.
Borrower: Reaching Goals Inc.
By:
Name: Shlome Ekstein
Title: President
ACKNOWLEDGMENT
State of New York )
) ss:
County of Orange )
to me or proved to me on
On March 3, 2023 , before me, the undersigned, personally appeared Shlome Ekstein, personally known
to the within instrument and acknowledged to me
the basis of satisfactory evidence to be the individual whose name is subscribed
the instrument, the individual, or the person, or entity upon
that he executed the same in his capacity, and that by his signature on
behalf of which the individual acted, executed the instrument .
tty fob li e
al g acknowledgment)
RENEE CHEVONNE SWANN
Notary Public - State of New York
NO. O1SWE409553
Qualified in Rockland County
My Commission Expires Sep 28, 2024
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Exhibit B
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SECURITY AGREEMENT
THIS SECURITY AGREEMENT (this “Agreement”) is made on March 3, 2023 by and
between Reaching Goals Inc. with an address of 3 Karlin Blvd., Unit 104, Monroe, New York
10950 (collectively referred to as the “Grantor”) and FinWise Bank (the “Bank”), with an address
at 756 East Winchester Strect, Suite 100, Murray, Utah 84107.
Under the terms hereof, the Bank desires to obtain and the Grantor desires to grant the Bank
security for all of the Obligations (as hereinafter defined),
NOW, THEREFORE, the Grantor and the Bank, intending to be legally bound, hereby
agree as follows:
1 Definitions.
1.1. “Collateral” shall include all personal property of the Grantor, including but.not
limited to all of the Debtor’s now owned or hereafter acquired “Accessions”, “Accounts”, “Deposit
ow
Accounts”, “Inventory 2 Equipment”, “Fixtures”, “Furniture”, “Books and Records”, “Chattel
Paper”, “Documents”, “General Intangibles”, “Instruments”, “Investment Property”, “Money”,
“Payment Intangibles or ? Promissory Notes”, “Securities”, “Software” and “Supporting Obligations”
as defined in the State of New York Uniform Commercial Code (“UCC”).
1.2. “Loan Documents” means this Agreement, any and all notes evidencing the
Obligations and all related documents, instruments and agreements.
13. “Obligations” shall include. all loans, advances, debts, liabilities, obligations,
covenants and duties owing from the Grantor to the Bank or to the Bank of any kind or nature,
present or future (including any interest accruing thereon after maturity, or after the filing of any
petition in bankruptey, or the commencement of any insolvency, reorganization or like proceeding
relating to the Grantor, whether or not a claim for post-filing or post-petition interest is allowed in
such proceeding), whether or not evidenced by any note, guaranty or other instrument, whether
arising under any agreement, instrument or document, whether or not for the payment of money,
whether arising by reason of an extension of credit, opening of a letter of credit, loan, equipment
lease or guarantee, under any interest or currency swap, future, option or other interest. rate
protection or similar agreement, or in any other manner, whether arising out of overdrafts on deposit
or other accounts or electronic funds transfers (whether through automated clearing houses or
otherwise) or out of the Bank's non-receipt of or inability to collect funds or otherwise not being
made whole in connection with depository transfer check or other similar arrangements, whether
direct or indirect (including those acquired by assignment or participation), absolute or contingent,
joint or several, due or to become due, now existing or hereafter arising, and any amendments,
extensions, renewals or increases and all costs and expenses of the Bank incurred in the
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documentation, negotiation, modification, enforcement, collection or otherwise in connection with
any of the foregoing, including reasonable attorneys' fees and expenses.
1.4. “UCC” means the Uniform Commercial Code, as adopted and enacted and as in
effect from time to time in the State of New York. Terms used herein which are defined in the UCC
and not otherwise defined herein shall have the respective meanings ascribed to such terms in the
uCcc.
2, Grant of Security Interest. To secure the Obligations, the Grantor, as debtor, hereby
assigns and grants to the Bank, as secured party, a continuing lien on and security interest in the
Collateral, including all cash and non-cash proceeds of same.
3 Change in Name or Locations. The Grantor hereby agrees that if the location of the
Collateral changes from the locations listed above, or if the Grantor changes its name or form or
jurisdiction of organization, or establishes a name in which it may do business, the Grantor will
immediately notify the Bank in writing of the additions or changes.
4. Representations and Warranties, The Grantor represents, warrants and covenants to the
Bank that: (a) the Grantor has good, marketable and indefeasible title to the Collateral, has not made
any prior sale, pledge, encumbrance, assignment or other disposition of any of the Collateral, and the
Collateral is free from all encumbrances and rights of setoff of any kind except the lien in favor of
the Bank created by this Agreement; (b) except as herein provided, the Grantor will not hereafter
without the Bank’s prior written consent sell, pledge, encumber, assign or otherwise dispose of any
of the Collateral or permit any right of setoff, lien or security interest to exist thereon except to the
Bank; (c) the Grantor will defend the Collateral against all claims and demands of all persons at any
time claiming the same or any interest therein; (d) each account and general intangible, if included in
the definition of Collateral, is genuine and enforceable in accordance with its tetms and the Grantor
will defend the same against all claims, demands, setoffs and counterclaims at any time asserted; and
(e) at the time any account or general intangible becomes subject to this Agreement, such account or
general intangible will be a good and valid account representing a bona fide sale of goods or services
by the Grantor and such goods will have been shipped to the respective account debtors or the
services will have been performed for the respective account debtors, and no such account or general
intangible will be subject to any claim for credit, allowance or adjustment by any account debtor or
any setoff, defense or counterclaim.
5 Grantor's Covenants, The Grantor covenants that it shall:
5.1. from time to time and at all reasonable times allow the Bank, by or through any ofits
officers, agents, attorneys, or accountants, to examine or inspect the Collateral, notify account
debtors of the Bank's security interest in accounts (if included in the definition of Collateral) and
obtain valuations and audits of the Collateral, at.the Grantor's expense, wherever located. The
Grantor shall do, obtain, make, execute and deliver all such additional and further acts, things, deeds,
assurances and instruments as the Bank may require to vest in and assure to the Bank its rights
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hereunder and in or to the Collateral, and the proceeds thereof, including waivers from landlords.
warehousemen and mortgagees
3.1 keep the Collateral in good order and repair at all times and immediately notify the
Bank of any event causing a material loss or decline in value of the Collateral, whether or not
covered by insurance, and the amount of such loss or depreciation;
5.2 only use or permit the Collateral to be used in accordance with all applicable federal
state, county and municipal laws and regulations; and
5.3. have and maintain insurance at all times with respect to all Collateral against risks of
fire (including so-called extended coverage), theft, sprinkler leakage, and other risks (including risk
of flood if, any Collateral is maintained at a location ina
i flood hazard zone) as the Bank may require,
in such form, in such amount, for such period and written by such companies as may be satisfactory
to the Bank in its sole discretion. Each such casualty insurance policy shall contain a standard
Lender's Loss Payable Clause issued in favor of the Bank under which all losses thereunder shall be
paid to the Bank as the Bank's interest may appear. Such policies shall expressly provide that the
requisite insurance cannot be altered or canceled without at least thirty (30) days prior written notice
to the Bank and shall insure the Bank notwithstanding the act or neglect of the Grantor. Upon the
Bank’s demand, the Grantor shall furnish the Bank with duplicate original policies of insurance or
such other evidence of insurance as the Bank may require. In the event of failure to provide
insurance as herein provided, the Bank may, at its option, obtain such insurance and the Grantor
shall pay to the Bank, on demand, the cost thereof. Proceeds of insurance may be applied by the
Bank to reduce the Obligations or to repair or replace Collateral, all in the Bank's sole discretion
6 Negative Pledge; No Transfer. The Grantor will not sell or offer to. sell or otherwise
transfer or grant or allow the imposition of a lien or security interest upon the Collateral (except for
sales of inventory and collections of accounts in the Grantor's ordinary course of business) or use
any portion thereof in any manner inconsistent with this Agreement or with the terms and conditions
of any policy of insurance thereon.
7 Covenants for Accounts. If accounts are included in the definition of Collateral
TA, The Grantor will, on the Bank’s demand, make notations on its books and records
showing the Bank’s security interest and make available to the Bank shipping and delivery receipts
evidencing the shipment of the goods that gave rise to an account, completion certificates or other
proof of the satisfactory performance of services that gave rise to an account, a copy of the invoice
for each account and copies of any written contract or order from which an account arose. The
Grantor shall promptly notify the Bank ifan account becomes evidenced or secured by an instrument
or chattel paper and upon the Bank’s request, will promptly deliver any such instrument or chattel
paper to the Bank, including any letter of credit delivered to the Grantor to support a shipment of
inventory by the Grantor.
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7.2. The Grantor will promptly advise the Bank whenever an account debtor refuses to
retain or returns any goods from the sale of which an account arose and will comply with any
instructions that the Bank may give regarding the sale or other disposition of such returns. From
time to time with such frequency as the Bank may request, the Grantor will report to the Bank all
credits given to account debtors on all accounts.
71. The Grantor will immediately notify the Bank if any account arises out of contracts
with the United States or any department, agency or instrumentality thereof, and will execute any
instruments and take any steps required by the Bank so that all monies due and to become due under
such contract shall be assigned to the Bank and notice of the assignment given to and acknowledged
by the appropriate government agency or authority under the Federal Assignment of Claims Act.
7.2. At any time after the occurrence of an Event of Default, and without notice to the
Grantor, the Bank may direct any persons who are indebted to the Grantor on any Collateral
consisting of accounts or general intangibles to make payment directly to the Bank of the amounts
due. The Bank is authorized to give receipts to such account debtors for any such payments and the
account debtors will be protected in making such payments to the Bank,
8 Further Assurances. At the Bank’s request, the Grantor will join with the Bank in
executing one or more financing, continuation or amendment statements pursuant to the UCC in
form satisfactory to the Bank and will pay the cost of preparing and filing the same in all
jurisdictions in. which such filing is deemed by the Bank to be necessary or desirable in order to
perfect, preserve and protect its security interests. The Grantor authorizes the Bank to file financing,
continuation or amendment statements pursuant.to the UCC with respect to all or any part of the
Collateral without the Grantor’s signature, where permitted by law. A carbon, photographic or other
copy of this Agreement or of a UCC financing statement may be filed as and in lieu of a UCC
financing statement. If any Collateral consists of depository accounts not maintained wit
Preview
D O RA OUN PK O6 PIV INDEX NO. EF004733-2024 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 06/12/2024 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF ORANGE FINWISE BANK, Plaintiff, STATEMENT FOR JUDGMENT - against - Index No.: EF004733-2024 REACHING GOALS INC., Defendant. AS AND FOR ITS JUDGMENT AGAINST DEFENDANT REACHING GOALS INC., IN CONNECTION WITH THEIR AFFIDAVIT OF JUDGMENT BY CONFESSION DATED MARCH 3, 2023, PLAINTIFF FINWISE BANK HEREBY STATES: Amount of Confession of Judgment through June 12, 2024 as $340,378.40 Per Affidavit of Timothy S. Brosnat Costs by Statute CPLR § 3218 $15.00 Fee for Index No. + ___ $210.00 Total Costs and Disbursements $225.00 TOTAL JUDGMENT $340,603.40 LEMERY GREISLER LLC, attorneys of record for the Plaintiff herein, states that the within Judgment has been confessed pursuant to Defendant’s Affidavit of Judgment by Confession dated March 3, 2023, and which is supported by the Affidavit of Timothy S. Brosnan in Support of Entry of Confession of Judgment, sworn to on June 12, 2024, all of which are being simultaneously submitted herewith, and The undersigned, an attorney admitted to practice in the State of New York, and an attomey of record for plaintiff in the above-entitled action, affirms under penalties of perjury and states that the costs and disbursements specified herewith have been or will necessarily be made or incurred Page 1 of 2 Filed in Orange County 06/12/2024 03:51:20 PM Bk:5168 38 Pg: 532 Index: # EF004733-2024 D O RA OUN PK O6 PIV INDEX NO. EF004733-2024 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 06/12/2024 and are reasonable in amount. Dated: June 12, 2024 Meghan M. Breen, Esq. Costs and disbursements taxed at $ COSTS TAXED @ $ 225.00 deat Clwackpreten ACTING DEPUTY COUNTY CLERK Clerk NOW on filing the foregoing affidavit of confession of judgment, sworn to by the Defendant on March 3, 2023, it is ADJUDGED that plaintiffs FinWise Bank, have judgment and recover of defendant Reaching Goals Inc. in the sum of $340,378.40, together with costs and disbursements as taxed by the clerk in the sum of $225.00, amounting in all to the sum of $340603.40 , plus interest at 9% per year from the date of this Judgment, and that the Plaintiff have execution therefor. eater Gtlwakprter Dated: 06/12/2024 ACTING DEPUTY COUNTY CLERK , 2024 Clerk Plaintiff’s Address FinWise Bank 756 East Winchester St., Suite 100 Murray, Utah 84107 Defendant’s Addresses Reaching Goals Inc. 3 Toby Place Monsey, New York 10952 Reaching Goals Inc. 55 Carlton Road Monsey, New York 10952 Page 2 of 2 2 of 38 D: O AN PK O6 5M INDEX NO. EF004733-2024 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 06/12/2024 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF ORANGE =. FinWise Bank, AFFIDAVIT FOR JUDGMENT Judgment Creditor/Plaintiff, BY CONFESSION (CPLR § 3218) ~against- Index No. EF004733-2024 Reaching Goals Inc., Judgment Debtor/Defendant. enwennnes: STATE OF NEW YORK SS. COUNTY OF ORANGE ; Shlome Ekstein, being duly sworn, deposes and says 1. Tam the duly authorized President of Reaching Goals Inc. (the “Borrower”) the Defendant in the above entitled action. Judgment Creditor, FinWise Bank (“FinWise”), is hereby authorized to use this Affidavit for Confession of Judgment, which is provided pursuant to Civil Practice Law and Rule §3218, to enter judgment against me as the Judgment Debtor in the event of a default under the loan documents listed below, for the sum of Three Hundred Fifty Thousand and 00/100 Dollars ($350,000.00), plus interest and less all payments received and applied by FinWise towards payment of the loan balance in accordance with the provisions of the Note and other loan documents. The amount for which judgment is confessed arises out of the loan relationship between Borrower and FinWise Bank pursuant to the loan documents referenced below. Note in the original principal sum of $350,000.00- Exhibit “A” Security Agreement — Exhibit “B” Loan and Security Agreement — Exhibit “C” Guaranty ~ Exhibit “D” Disclosure for Confession of Judgment — Exhibit “E” Borrower has a principal place of business at 3 Toby Place, Monroe, New York 10950 in Orange County, New York. I currently reside at 3 Karlin Blvd., Unit 104, Monroe, New York 10950 and authorize entry of judgment in Orange County, New York. Thereby authorize and empower FinWise, any of its representatives or attorneys to enter judgment against me as Judgment Debtor under the terms confessed in this affidavit in Orange County, New York. 01334398-3 3 of 38 D: RA OUN PK O6 DM INDEX NO. EF004733-2024 NYSCEF Doc. NO. 5 RECEIVED NYSCEF: 06/12/2024 This affidavit is not: given to secure FinWise against a contingent liability and does not relate to a transaction referenced in Civil Practice Law and Rule 3201. The sum confessed is due and payable and does not exceed the amount of the liability under the aforementioned loan documents, I acknowledge and affirm that I have had a full and fair opportunity to consult with an attorney of my choice prior to executing this affidavit. 10. 1 acknowledge and affirm that I have been advised that this affidavit will, upon a default in payment under the Note, allow FinWise to enter judgment against Borrower without notice. li I further acknowledge and affirm that I have been advised that once judgment has been entered, FinWise may enforce the judgment in accordance with law which may include restraint and seizure of Judgment Debtor’s assets and other remedies as the law provides. 12. I further acknowledge and affirm that FinWise’s rights to other remedies pursuant to the parties’ loan documents and at law are not waived and are reserved to the fullest extent the law allows. 8Kiome Ekstein, President ACKNOWLEDGMENT State of New York ) )ss.: County of Orange ) On March 3, 2023 ,before me, the undersigned, personally appeared Shiome Ekstein, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the person, or entity upon behalf of which the individual acted, executed the instrument. RENEE CHEVONNE SWANN Notary Public - State of New York NO, 018W6409553 Qualified in Rocktand County My Commission Expires Sep. 28, 2024 01334398-3 4 of 38 D O RA OUN PK O6 Dv INDEX NO. EF004733-2024 NYSCEF Doc. NO. 5 RECEIVED NYSCEF: 06/12/2024 Exhibit A 5 of 38 D: RA OUN PK O6 Dv INDEX NO. EF004733-2024 NYSCEF Doc. NO. 5 RECEIVED NYSCEF: 06/12/2024 U.S. Small Business Administration a U.S. Small Business Administration S NOTE SBA Loan # a SBA Loan Name Reaching Goals Inc. Date March 3, 2023 Loan Amount $350,000.00 Interest Rate 10.25% (Wall Street Journal Prime + 2.75%), variable, adjusted eyery calendar quarter Borrower Reaching Goals Inc, Operating N/A Company Lender FinWise Bank 1... PROMISE TO PAY: an: In return for the Loan, Borrower promises to pay to the order of Lender the amount of Three Hundred Fifty Thousand 10/100 Dollars ($350,000.00), interest on the unpaid principal balance, and all other amounts required by this Note. DEFINITIONS: ! “Collateral” means any property taken as security for payment of this Note or any guarantee of this Note, “Guarantor” means each person or entity that signs @ guarantee of payment of this Note. *Léan" means the loan evidenced by this Note, pledges "Loan Documents" means the documents related to this loan signed by Borrower, any Guarantor, or anyone who collateral. "SBA" means the Small Business Administration, an Agency of the United States of America. 3, PAYMENT TERMS: 01334413-3 Page | of & SBA Form 147 (06/03/02) Version 4. 6 of 38 D: RA OUN PK O6 Dv INDEX NO. EF004733-2024 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 06/12/2024 Borrower must make all payments at the place Lender designates. The payment terms for this Note are: The interest rate on this Note will fluctuate. The initial interest rate is 10.25% per year. This initial rate is the Prime Rate in effect on the first business day of the month in which SBA received the loan application, plus 2.75%. The initial interest rate must remain in effect until the first change period begins unless changed in accordance with SOP 50 10. Borrower must pay principal and interest payments of $4,673.87 every month, beginning one month from the month this Note is dated; payments must be made on the fifth calendar day in the months they are due. to Lender will apply each installment payment first to pay interest accrued to the day Lender receives the payment, then bring principal current, then to pay any late fees, and will apply any remaining balance to reduce principal. of first rate The interest rate, will be adjusted every calendar quarter (the "change period") beginning April 1, 2023 (date adjustment). in the Wall Street The “Prime Rate” is the Prime Rate in effect on the first business day of the month (as published the first day of the month in which any interest rate change Journal newspaper) in which SBA received the application, or with .004 being rounded down and 005 being rounded up. occurs. Base Rates will be rounded to two decimal places on the first calendar The adjusted interest rate will be 2.75% abo ve the Prime Rate, Lender will adjust the interest rate Lender gives Borrower notice of day of each change period. The change in interest rate is effective on that day whether or not the change. changed in accordance with The interest rate identified in the Note may not be changed during the life of the Loan unless SOP 50 10. The interest rate adjustment period may only be changed in accordance with SOP 50 10. remaining term of the Lender must adjust the payment amount at least annually as needed to amortize principal over the note.. at the rate in If SBA purchases the guaranteed portion of the unpaid principal balance, the interest rate becomes fixed payment default, the rate becomes fixed at the effect at the time of the earliest uncured payment default. If there is no uncured rate in effect at the time of purchase. Loan Prepayment: Notwithstanding any provision of this Note to the contrary: at any time without Borrower may prepay this Note. Borrower may prepay 20 percent or less of the unpaid principal balance on the secondary market, Borrower must: notice. If Borrower prepays more than 20 percent and the Loan has been sold A. Give Lender written notice; B. Pay all accrued interest; and equal to 21 days’ C. If the prepayment is received less than 21 days from the date Lender receives the notice, pay an amount and paid under subparagraph B interest from the date lender receives the notice, less any interest accrued during the 21 days above. 01334413-3 Page 2 of 6 SBA Form 147 (06/03/02) Version 4.1 7 of 38 D: RA OUN PK O6 Dv INDEX NO. EF004733-2024 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 06/12/2024 If Borrower does not prepay within 30 days from the date Lender receives the notice, Borrower must give Lender anew notice. All remaining principal and accrued interest is due and payable 10 years from date of Note. Late Charge: Ifa payment on this Note is more than 10 days late, Lender may charge Borrower a late fee of up to 5% of the unpaid portion of the regularly scheduled payment. 4. DEFAULT: Borrower is in default under this Note if Borrower does not make a payment when due under this Note, or if Borrower or Operating Company: A. Fails to do anything required by this Note and other Loan Documents; B. Defaults on any other loan with Lender; C. Does not preserve, or account to Lender's satisfaction for, any of the Collateral or its proceeds; D. Does not disclose, or anyone acting on their behalf does not disclose, any material fact to Lender or SBA; E. Makes, or anyone acting on their behalf makes, a materially false or misleading representation to Lender or SBA; F, Defaults on any loan or agreement with another creditor, if Lender believes the default may materially affect Borrower's ability to pay this Note; G. Fails to pay any taxes when due; H. Becomes the subject of a proceeding under any bankruptcy or insolvency law; I. Has a receiver or liquidator appointed for any part of their business or property; J, Makes an assignment for the benefit of creditors; K. Has any adverse change in financial condition or business operation that Lender believes may materially affect Borrower's ability to pay this Note; L, Reorganizes, merges, consolidates, or otherwise changes ownership or business structure without Lender's prior written consent; or M. Becomes the subject of a civil or criminal action that Lender believes may materially affect Borrower's ability to pay this Note, 5, LENDER'S RIGHTS IF THERE IS A DEFAULT: Without notice or demand and without giving up any of its rights, Lender may: A. Require immediate payment of all amounts owing under this Note; B. Collect all amounts owing from any Borrower or Guarantor; C. File suit and obtain judgment; 01334413-3 ‘SBA Form 147 (06/03/02) Version 4.1 Page3 of 6 8 of 38 D: RA OUN PK O6 Dv INDEX NO. EF004733-2024 NYSCEF DOC. NO. 5 RECEIVED NYSCEF: 06/12/2024 D. Take possession of any Collateral; or E. Sell, lease, or otherwise dispose of, any Collateral at public or private sale, with or without advertisement. 6. LENDER'S GENERAL POWERS: Without notice and without Borrower's consent, Lender may: A, Bid on or buy the Collateral at its sale or the sale of another lienholder, at any price it chooses; B. Incur expenses to collect amounts due under this Note, enforce the terms of this Note or any other Loan Document, and preserve or dispose of the Collateral. Among other things, the expenses may include payments for property taxes, prior liens, insurance, appraisals, environmental remediation costs, and reasonable attorney's fees and costs. If Lender incurs such expenses, it may demand immediate repayment from Borrower or add the expenses to the principal balance; C. Release anyone obligated to pay this Note; D. Compromise, release, renew, extend or substitute any of the Collateral; and E, Take any action necessary to protect the Collateral or collect amounts owing on this Note. 7. WHEN FEDERAL LAW APPLIES: When SBA is the holder, this Note will be interpreted and enforced under federal law, including SBA regulations. Lender or SBA may use state or local procedures for filing papers, recording documents, giving notice, foreclosing liens, and other purposes. By using such procedures, SBA does not waive any federal immunity from state or local control, penalty, tax, or liability: As to this Note, Borrower may not claim or assert against SBA any local or state law to deny any obligation, defeat any claim of SBA, or preempt federal Jaw. 8, SUCCESSORS AND ASSIGNS: Under this Note, Borrower and Operating Company include the successors of each, and Lender includes its successors and assigns. 9, GENERAL PROVISIONS: A. All individuals and entities signing this Note are jointly and severally liable. B, Borrower waives all suretyship defenses. C. Borrower must sign all documents necessary at any time to comply with the Loan Documents and to enable Lender to acquire, perfect, or maintain Lender's liens on Collateral. D. Lender may exercise any of its rights separately or together, as many times and in any order it chooses.. Lender may delay or forgo enforcing any of its rights without giving up any of them. E, Borrower may not use an oral statement of Lender or SBA to contradict or alter the written terms of this Note. o1334413-3 SBA Form 147 (06/03/02) Version 4.1 Page 4 of 6 9 of 38 D: RA OUN PK O6 Dv INDEX NO. EF004733-2024 NYSCEF Doc. NO. 5 RECEIVED NYSCEF: 06/12/2024 F. If any part of this Note is unenforceable, all other parts remain in effect. G. To the extent allowed by law, Borrower waives all demands and notices in connection with this Note, including presentment, demand, protest, and notice of dishonor. Borrower also waives any defenses based upon any claim that Lender did not obtain any guarantee; did not obtain, perfect, or maintain a lien upon Collateral; impaired Collateral; or did not obtain the fair market value of Collateral at a sale. 10. STATE-SPECIFIC PROVISIONS: POWER TO CONFESS JUDGMENT. UPON THE OCCURRENCE OF A DEFAULT, BORROWER HEREBY ‘AUTHORIZES ANY ATTORNEY DESIGNATED BY LENDER OR ANY CLERK OF ANY COURT OF RECORD TO APPEAR FOR BORROWER IN ANY COURT OF RECORD AND CONFESS JUDGMENT WITHOUT PRIOR HEARING AGAINST BORROWER IN FAVOR OF LENDER FOR, AND IN THE AMOUNT OF, THE UNPAID BALANCE OF THE PRINCIPAL AMOUNT OF THE NOTE, ALL INTEREST ACCRUED AND UNPAID THEREON, ALL OTHER AMOUNTS PAYABLE BY BORROWER TO LENDER UNDER THE TERMS OF THIS NOTE OR ANY OTHER AGREEMENT, DOCUMENTS, INSTRUMENT EVIDENCING, SECURING OR GUARANTYING THE OBLIGATION EVIDENCED BY THIS NOTE COST OF SUIT, AND ALL REASONABLE ATTORNEYS’ FEES ACTUALLY INCURRED BY LENDER IN CONNECTION WITH ENFORCING ANY OF THE RIGHTS OR REMEDIES HEREUNDER. IT IS THE EXPRESS INTENT OF THE PARTIES HERETO THAT EVEN AFTER ONE OR MORE CONFESSED JUDGMENTS ARE ENTERED PURSUANT TO THIS NOTE THAT LENDER SHALL RETAIN THE RIGHT TO COLLECT AND CONFESS JUDGMENT FOR: ATTORNEYS’ FEES, EXPENSES AND COSTS ACTUALLY INCURRED IN CONNECTION WITH THE COLLECTION OF THIS NOTE; ATTORNEYS’ FEES, EXPENSES AND COSTS ACTUALLY INCURRED TO DEFEND ITSELF FROM ANY CLAIMS ARISING IN CONNECTION WITH THIS NOTE OR RELATED DOCUMENTS; ATTORNEYS’ FEES, EXPENSES AND COSTS ACCTUALLY INCURRED IN PROTECTING LENDER’S COLLATERAL AND INTEREST (COLLECTIVELY THE “POST JUDGMENT COSTS”). IT 1S ALSO THE EXPRESS INTENT OF THE PARTIES HERETO THAT LENDER’S ABILITY AND RIGHT TO COLLECT FROM AND CONFESS JUDGMENT AGAINST BORROWER FOR ALL AMOUNTS DUE HEREUNDER, INCLUDING, WITHOUT LIMITATION, POST JUDGMENT COSTS, SHALL NOT MERGE INTO ANY JUDGMENT OR JUDGMENTS IN FAVOR OF LENDER. FURTHERMORE, IT IS THE EXPRESS INTENT OF THE PARTIES HERETO THAT: THE LENDER’S ABILITY AND RIGHT TO COLLECT FROM AND CONFESS JUDGMENT AGAINST BORROWER, SHALL CONTIUNE UNDIMINISHED UNTIL LENDER HAS RECEIVED PAYMENT IN: FULL OF ALL AMOUNTS DUE HEREUNDER, INCLUDING, WITHOUT LIMTIATION, ALL POST JUDGMENT COSTS. BORROWER HEREBY RELEASES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ALL ERRORS AND ALL RIGHTS OF EXEMPTION, APPEAL, STAY OF EXECUTION, INQUISITION, AND OTHER RIGHTS TO WHICH THE BORROWER MAY OTHERWISE BE ENTITLED TO UNDER THE LAWS OF THE UNITED STATES OR OF ANY STATE OR POSSESSION OF THE UNITED STATES NOW IN FORCE AND WHICH MAY HEREAFTER BE ENACTED. THE AUTHORITY AND POWER TO APPEAR FOR AND ENTER JUDGMENT AGAINST BORROWER SHALL NOT BE EXHAUSTED BY ONE OR MORE EXERCISES THEREOF OR BY ANY IMPERFECT EXERCISE THEREOF AND SHALL NOT BE EXTINGUISHED BY ANY JUDGMENT ENTERED PURSUANT THERETO. SUCH AUTHORITY MAY BE EXERCISED ON ONE OR MORE OCCASIONS OR FROM TIME TO TIME IN THE SAME OR DIFFERENT JURISDICTIONS AS OFTEN AS LENDER SHALL: DEEM NECESSARY OR DESIRABLE, FOR ALL OF WHICH THIS NOTE SHALL BE A SUFFICIENT WARRANT. 01334413-3 SBA Form 147 (06/03/02) Version 4.1 Page $ of 6 10 of 38 D: RA OUN PK O6 Dv INDEX NO. EF004733-2024 NYSCEF Doc. NO. 5 RECEIVED NYSCEF: 06/12/2024 11, BORROWER'S NAME(S) AND SIGNATURE(S): By signing below, each individual or entity becomes obligated under this Note as Borrower. Borrower: Reaching Goals Inc. By: Name: Shlome Ekstein Title: President ACKNOWLEDGMENT State of New York ) ) ss: County of Orange ) to me or proved to me on On March 3, 2023 , before me, the undersigned, personally appeared Shlome Ekstein, personally known to the within instrument and acknowledged to me the basis of satisfactory evidence to be the individual whose name is subscribed the instrument, the individual, or the person, or entity upon that he executed the same in his capacity, and that by his signature on behalf of which the individual acted, executed the instrument . tty fob li e al g acknowledgment) RENEE CHEVONNE SWANN Notary Public - State of New York NO. O1SWE409553 Qualified in Rockland County My Commission Expires Sep 28, 2024 01334413-3 Page 6 of 6 SBA Form 147 (06/03/02) Version 4.1 11 of 38 D O RA OUN PK O6 Dv INDEX NO. EF004733-2024 NYSCEF Doc. NO. 5 RECEIVED NYSCEF: 06/12/2024 Exhibit B 12 of 38 D: RA OUN PK O6 Dv INDEX NO. EF004733-2024 NYSCEF Doc. NO. 5 RECEIVED NYSCEF: 06/12/2024 SECURITY AGREEMENT THIS SECURITY AGREEMENT (this “Agreement”) is made on March 3, 2023 by and between Reaching Goals Inc. with an address of 3 Karlin Blvd., Unit 104, Monroe, New York 10950 (collectively referred to as the “Grantor”) and FinWise Bank (the “Bank”), with an address at 756 East Winchester Strect, Suite 100, Murray, Utah 84107. Under the terms hereof, the Bank desires to obtain and the Grantor desires to grant the Bank security for all of the Obligations (as hereinafter defined), NOW, THEREFORE, the Grantor and the Bank, intending to be legally bound, hereby agree as follows: 1 Definitions. 1.1. “Collateral” shall include all personal property of the Grantor, including but.not limited to all of the Debtor’s now owned or hereafter acquired “Accessions”, “Accounts”, “Deposit ow Accounts”, “Inventory 2 Equipment”, “Fixtures”, “Furniture”, “Books and Records”, “Chattel Paper”, “Documents”, “General Intangibles”, “Instruments”, “Investment Property”, “Money”, “Payment Intangibles or ? Promissory Notes”, “Securities”, “Software” and “Supporting Obligations” as defined in the State of New York Uniform Commercial Code (“UCC”). 1.2. “Loan Documents” means this Agreement, any and all notes evidencing the Obligations and all related documents, instruments and agreements. 13. “Obligations” shall include. all loans, advances, debts, liabilities, obligations, covenants and duties owing from the Grantor to the Bank or to the Bank of any kind or nature, present or future (including any interest accruing thereon after maturity, or after the filing of any petition in bankruptey, or the commencement of any insolvency, reorganization or like proceeding relating to the Grantor, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding), whether or not evidenced by any note, guaranty or other instrument, whether arising under any agreement, instrument or document, whether or not for the payment of money, whether arising by reason of an extension of credit, opening of a letter of credit, loan, equipment lease or guarantee, under any interest or currency swap, future, option or other interest. rate protection or similar agreement, or in any other manner, whether arising out of overdrafts on deposit or other accounts or electronic funds transfers (whether through automated clearing houses or otherwise) or out of the Bank's non-receipt of or inability to collect funds or otherwise not being made whole in connection with depository transfer check or other similar arrangements, whether direct or indirect (including those acquired by assignment or participation), absolute or contingent, joint or several, due or to become due, now existing or hereafter arising, and any amendments, extensions, renewals or increases and all costs and expenses of the Bank incurred in the 01334418-2 13 of 38 D: RA OUN PK O6 Dv INDEX NO. EF004733-2024 NYSCEF Doc. NO. 5 RECEIVED NYSCEF: 06/12/2024 documentation, negotiation, modification, enforcement, collection or otherwise in connection with any of the foregoing, including reasonable attorneys' fees and expenses. 1.4. “UCC” means the Uniform Commercial Code, as adopted and enacted and as in effect from time to time in the State of New York. Terms used herein which are defined in the UCC and not otherwise defined herein shall have the respective meanings ascribed to such terms in the uCcc. 2, Grant of Security Interest. To secure the Obligations, the Grantor, as debtor, hereby assigns and grants to the Bank, as secured party, a continuing lien on and security interest in the Collateral, including all cash and non-cash proceeds of same. 3 Change in Name or Locations. The Grantor hereby agrees that if the location of the Collateral changes from the locations listed above, or if the Grantor changes its name or form or jurisdiction of organization, or establishes a name in which it may do business, the Grantor will immediately notify the Bank in writing of the additions or changes. 4. Representations and Warranties, The Grantor represents, warrants and covenants to the Bank that: (a) the Grantor has good, marketable and indefeasible title to the Collateral, has not made any prior sale, pledge, encumbrance, assignment or other disposition of any of the Collateral, and the Collateral is free from all encumbrances and rights of setoff of any kind except the lien in favor of the Bank created by this Agreement; (b) except as herein provided, the Grantor will not hereafter without the Bank’s prior written consent sell, pledge, encumber, assign or otherwise dispose of any of the Collateral or permit any right of setoff, lien or security interest to exist thereon except to the Bank; (c) the Grantor will defend the Collateral against all claims and demands of all persons at any time claiming the same or any interest therein; (d) each account and general intangible, if included in the definition of Collateral, is genuine and enforceable in accordance with its tetms and the Grantor will defend the same against all claims, demands, setoffs and counterclaims at any time asserted; and (e) at the time any account or general intangible becomes subject to this Agreement, such account or general intangible will be a good and valid account representing a bona fide sale of goods or services by the Grantor and such goods will have been shipped to the respective account debtors or the services will have been performed for the respective account debtors, and no such account or general intangible will be subject to any claim for credit, allowance or adjustment by any account debtor or any setoff, defense or counterclaim. 5 Grantor's Covenants, The Grantor covenants that it shall: 5.1. from time to time and at all reasonable times allow the Bank, by or through any ofits officers, agents, attorneys, or accountants, to examine or inspect the Collateral, notify account debtors of the Bank's security interest in accounts (if included in the definition of Collateral) and obtain valuations and audits of the Collateral, at.the Grantor's expense, wherever located. The Grantor shall do, obtain, make, execute and deliver all such additional and further acts, things, deeds, assurances and instruments as the Bank may require to vest in and assure to the Bank its rights 01334418-2 2 14 of 38 RA OUN PK O6 Dv INDEX NO. EF004733-2024 NYSCEF Doc. NO. 5 RECEIVED NYSCEF: 06/12/2024 hereunder and in or to the Collateral, and the proceeds thereof, including waivers from landlords. warehousemen and mortgagees 3.1 keep the Collateral in good order and repair at all times and immediately notify the Bank of any event causing a material loss or decline in value of the Collateral, whether or not covered by insurance, and the amount of such loss or depreciation; 5.2 only use or permit the Collateral to be used in accordance with all applicable federal state, county and municipal laws and regulations; and 5.3. have and maintain insurance at all times with respect to all Collateral against risks of fire (including so-called extended coverage), theft, sprinkler leakage, and other risks (including risk of flood if, any Collateral is maintained at a location ina i flood hazard zone) as the Bank may require, in such form, in such amount, for such period and written by such companies as may be satisfactory to the Bank in its sole discretion. Each such casualty insurance policy shall contain a standard Lender's Loss Payable Clause issued in favor of the Bank under which all losses thereunder shall be paid to the Bank as the Bank's interest may appear. Such policies shall expressly provide that the requisite insurance cannot be altered or canceled without at least thirty (30) days prior written notice to the Bank and shall insure the Bank notwithstanding the act or neglect of the Grantor. Upon the Bank’s demand, the Grantor shall furnish the Bank with duplicate original policies of insurance or such other evidence of insurance as the Bank may require. In the event of failure to provide insurance as herein provided, the Bank may, at its option, obtain such insurance and the Grantor shall pay to the Bank, on demand, the cost thereof. Proceeds of insurance may be applied by the Bank to reduce the Obligations or to repair or replace Collateral, all in the Bank's sole discretion 6 Negative Pledge; No Transfer. The Grantor will not sell or offer to. sell or otherwise transfer or grant or allow the imposition of a lien or security interest upon the Collateral (except for sales of inventory and collections of accounts in the Grantor's ordinary course of business) or use any portion thereof in any manner inconsistent with this Agreement or with the terms and conditions of any policy of insurance thereon. 7 Covenants for Accounts. If accounts are included in the definition of Collateral TA, The Grantor will, on the Bank’s demand, make notations on its books and records showing the Bank’s security interest and make available to the Bank shipping and delivery receipts evidencing the shipment of the goods that gave rise to an account, completion certificates or other proof of the satisfactory performance of services that gave rise to an account, a copy of the invoice for each account and copies of any written contract or order from which an account arose. The Grantor shall promptly notify the Bank ifan account becomes evidenced or secured by an instrument or chattel paper and upon the Bank’s request, will promptly deliver any such instrument or chattel paper to the Bank, including any letter of credit delivered to the Grantor to support a shipment of inventory by the Grantor. 01334418-2 15 of 38 D: RA OUN PK O6 Dv INDEX NO. EF004733-2024 NYSCEF Doc. NO. 5 RECEIVED NYSCEF: 06/12/2024 7.2. The Grantor will promptly advise the Bank whenever an account debtor refuses to retain or returns any goods from the sale of which an account arose and will comply with any instructions that the Bank may give regarding the sale or other disposition of such returns. From time to time with such frequency as the Bank may request, the Grantor will report to the Bank all credits given to account debtors on all accounts. 71. The Grantor will immediately notify the Bank if any account arises out of contracts with the United States or any department, agency or instrumentality thereof, and will execute any instruments and take any steps required by the Bank so that all monies due and to become due under such contract shall be assigned to the Bank and notice of the assignment given to and acknowledged by the appropriate government agency or authority under the Federal Assignment of Claims Act. 7.2. At any time after the occurrence of an Event of Default, and without notice to the Grantor, the Bank may direct any persons who are indebted to the Grantor on any Collateral consisting of accounts or general intangibles to make payment directly to the Bank of the amounts due. The Bank is authorized to give receipts to such account debtors for any such payments and the account debtors will be protected in making such payments to the Bank, 8 Further Assurances. At the Bank’s request, the Grantor will join with the Bank in executing one or more financing, continuation or amendment statements pursuant to the UCC in form satisfactory to the Bank and will pay the cost of preparing and filing the same in all jurisdictions in. which such filing is deemed by the Bank to be necessary or desirable in order to perfect, preserve and protect its security interests. The Grantor authorizes the Bank to file financing, continuation or amendment statements pursuant.to the UCC with respect to all or any part of the Collateral without the Grantor’s signature, where permitted by law. A carbon, photographic or other copy of this Agreement or of a UCC financing statement may be filed as and in lieu of a UCC financing statement. If any Collateral consists of depository accounts not maintained wit