Exhibit 10.1



 


Silicon
Valley Bank


 


U.S.
Small Business Administration 

Paycheck Protection Program 

Note


 


	SBA
    Loan No.	

        9920647100

	SBA
    Loan Name	Borrower

        Legal Name
	

        Modular Medical,
        Inc.

	DBA	 
	Date	

        4/23/2020

	Loan
    Amount	$
    368780
	Interest
    Rate	1.0%
    per annum
	Borrower	

        Modular Medical,
        Inc.

	Operating
    Company	Not
    applicable
	Lender	Silicon
    Valley Bank





 


	1.	PROMISE
                                         TO PAY.



 


In return for the Loan,
Borrower promises to pay to the order of Lender the amount of $ 368780                         Dollars,
interest on the unpaid principal balance, and all other amounts required by this Note.


 


	2.	DEFINITIONS.



 


“Collateral”
means any property taken as security for payment of this Note or any guarantee of this Note.


 


“CARES Act” means the
Coronavirus Aid, Relief, and Economic Security Act.


 


“Guarantor”
means each person or entity that signs a guarantee of payment of this Note.


 


“Loan” means
the loan evidenced by this Note.


 


“Loan Documents”
means the documents related to this loan signed by Borrower, any Guarantor, or anyone who pledges collateral.


 


“Paycheck Protection
Program” means loan program created by Section 1102 of the CARES Act.


 

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“Per Annum”
means for a year deemed to be comprised of 360 days.


 


“SBA” means
the Small Business Administration, an Agency of the United States of America.


 


	3.	PAYMENT
                                         TERMS: Borrower must make all payments at the place Lender designates. The payment terms
                                         for this Note are:



 


	A.	Conditions
                                         Precedent to Disbursement of Loan Proceeds.



 


Before the funding of
the Loan, the following conditions must be satisfied:


 


		1.	Lender
                                         has approved the request for the Loan.



 


		2.	Lender
                                         has received approval from SBA to fund the Loan.



 


	B.	No
                                         Payments During Deferral Period. There shall be no payments due by Borrower during
                                         the six- month period beginning on the date of this Note (the “Deferral Period”).
                                         However, during the Deferral Period interest will accrue at the Interest Rate on the
                                         unpaid principal balance computed on the basis of the actual number of days elapsed in
                                         a year of 360 days.



 


	C.	Principal
                                         and Interest Payments. Commencing one month after the expiration of the Deferral
                                         Period, and continuing on the same day of each month thereafter until the Maturity Date,
                                         Borrower shall pay to Lender monthly payments of principal and interest, each in such
                                         equal amount required to fully amortize the principal amount outstanding on the Note
                                         on the last day of the Deferral Period by the Maturity Date.



 


	D.	Maturity
                                         Date. On the date which is twenty-four (24) months from the date of this Note (the
                                         “Maturity Date”), Borrower shall pay to Lender any and all unpaid principal
                                         plus accrued and unpaid interest plus interest accrued during the Deferral Period. This
                                         Note will mature on the Maturity Date.



 


	E.	Not
                                         a Business Day. If any payment is due on a date for which there is no numerical equivalent
                                         in a particular calendar month then it shall be due on the last day of such month. If
                                         any payment is due on a day that is a Saturday, Sunday or any other day on which California
                                         chartered banks are authorized to be closed, the payment will be made on the next business
                                         day.



 


	F.	Payment
                                         Allocation. Payments shall be allocated among principal and interest at the discretion
                                         of Lender unless otherwise agreed or required by applicable law (including the CARES
                                         Act). Notwithstanding, in the event the Loan, or any portion thereof, is forgiven pursuant
                                         to the Paycheck Protection Program under the federal CARES Act, the amount so forgiven
                                         shall be applied to principal.



 


	F.	Prepayments.
                                         Borrower may prepay this Note at any time without payment of any penalty or premium.



 

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	G.	Borrower
                                         Certifications.



 


Borrower certifies to
Lender as follows:


 


		1.	Current
                                         economic uncertainty makes this Loan necessary to support the ongoing operations of Borrower.



 


		2.	Loan
                                         funds will be used by Borrower to retain its workers and maintain its payroll or make
                                         its mortgage payments, lease payments, and utility payments.



 


		3.	For
                                         the period beginning on February 15, 2020 and ending on December 31, 2020, Borrower did
                                         not receive, and agrees it will not apply for or receive, another loan under the Paycheck
                                         Protection Program.



 


		4.	Borrower
                                         was in operation on February 15, 2020 and (i) had employees for whom it paid salaries
                                         and payroll taxes or (ii) paid independent contractors as reported on a 1099-Misc.



 


		5.	Borrower
                                         has reviewed and understands Sections 1102 and 1106 of the CARES Act and the related
                                         guidelines and has completed the Application, including Borrower’s eligibility
                                         in conformity with those provisions.



 


		6.	Borrower
                                         has taken its “affiliates” (as defined by the SBA) into account when determining
                                         the number of employees and the total amount of loans permitted under the Paycheck Protection
                                         Program.



 


		7.	Borrower
                                         is a small business concern or is otherwise eligible to receive a covered loan.



 


		8.	The
                                         person who has completed and signed the application, this Note and the Loan Documents
                                         has been validly authorized by Borrower to enter into borrowings on behalf of Borrower.



 


	H.	Agreements.



 


Borrower understands
and agrees, and waives and releases Lender, its affiliates and their respective directors, officers, agents and employees, as
follows:


 


		1.	The
                                         Loan will be made under the SBA’s Paycheck Protection Program. Accordingly, this
                                         Note and the other Loan Documents must be submitted to and approved by the SBA. There
                                         is limited funding available under the Paycheck Protection Program and accordingly, all
                                         applications submitted will not be approved by the SBA.



 


		2.	Lender
                                         is participating in the Payroll Protection Program to help businesses impacted by the
                                         economic impact from COVID-19. However, Lender anticipates high volumes and there may
                                         be processing delays and system failures along with other issues that interfere with
                                         submission of Borrower’s application to SBA. Lender does not represent or guarantee
                                         that it will submit the application while SBA funding remains available under the Payroll
                                         Protection Program or at all. Borrower hereby agrees that Lender is not responsible or
                                         liable to Borrower or any of its affiliates (i) if the Lender does not submit Borrower’s
                                         application to the SBA until after the date that SBA stops approving applications
under the Paycheck Protection Program, for any reason or (ii) if the application is not processed by Lender. Borrower forever
releases and waives any claims against Lender, its affiliates and their respective directors, officers, agents and employees concerning
failure to obtain the Loan. This release and waiver applies to, but is not limited to, any claims concerning Lender’s (i)
pace, manner or systems for processing or prioritizing applications, or (ii) representations by Lender regarding the application
process, the Paycheck Protection Program, or availability of funding. This agreement to release and waiver supersedes any prior
communications, understandings, agreements or communications on the issues set forth herein.



 

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		3.	Forgiveness
                                         of the Loan is only available for principal that is used for the limited purposes that
                                         expressly qualify for forgiveness under SBA requirements, and that to obtain forgiveness,
                                         Borrower must request forgiveness from the Lender, provide documentation in accordance
                                         with the SBA requirements, and certify that the amounts Borrower is requesting to be
                                         forgiven qualify under those requirements. Borrower also understands that Borrower shall
                                         remain responsible under the Loan for any amounts not forgiven, and that interest payable
                                         under the Loan will not be forgiven, but that the SBA may pay the Loan interest on forgiven
                                         amounts.



 


		4.	Forgiveness
                                         of the Loan is not automatic and Borrower must request forgiveness of the Loan from Lender.
                                         Borrower is not relying on Lender for its understanding of the requirements for forgiveness
                                         such as eligible expenditures, necessary records/documentation, or possible reductions
                                         due to changes in number of employees or compensation. Borrower agrees that will consult
                                         the SBA’s program materials and consult with its own counsel regarding the criteria
                                         forgiveness.



 


		5.	The
                                         Loan Documents are subject to review, and Borrower may not receive the Loan. The Loan
                                         also remains subject to availability of funds under the SBA’s Payment Protection
                                         Program, and to the SBA issuing an SBA loan number.



 


		6.	Borrower’s
                                         liability under this Note will continue with respect to any amounts SBA may pay Bank
                                         based on an SBA guarantee of this Note. Any agreement with Bank under which SBA may guarantee
                                         this Note does not create any third party rights or benefits for Borrower and, if SBA
                                         pays Bank under such an agreement, SBA or Bank may then seek recovery from Borrower of
                                         amounts paid by SBA.



 


		7.	Lender
                                         reserves the right to modify the Note Amount based on documentation received from Borrower.



 


		8.	Borrower’s
                                         execution of this Note has been duly authorized by all necessary actions of its governing
                                         body. The person signing this Note is duly authorized to do so on behalf of Borrower.



 


		9.	This
                                         Note shall not be governed by any existing or future credit agreement or loan agreement
                                         with Lender. The liabilities guaranteed pursuant to any existing or future guaranty in
                                         favor of Lender shall not include this Note. The liabilities secured by any existing
                                         or future security instrument in favor of Lender shall not include the Loan.



 

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		10.	The
                                         proceeds of the Loan will be used to retain workers and maintain payroll or make mortgage
                                         interest payments, lease payments, and utility payments, as specified under the Paycheck
                                         Protection Program Rule. Borrower understands that if the funds are knowingly used for
                                         unauthorized purposes, the federal government may hold Borrower legally liable, such
                                         as for charges of fraud.



 


Electronic Execution
of Loan Documents.


 


The
words “execution,” “signed,” “signature” and words of like import in this Note and any Loan
Document shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be
of the same legal effect, validity and enforceability as a manually executed signature or the use of a paper-based recordkeeping
systems, as the case may be, to the extent and as provided for in any applicable law, including, without limitation, any state
law based on the Uniform Electronic Transactions Act.


 


	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



 

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		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.



 


		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; GOVERNING LAW; FORUM SELECTION.



 


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 law.


 

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	8.	SUCCESSORS
                                         AND ASSIGNS.



 


Under this Note, Borrower
and Operating Company includes its successors, 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.



 


		E.	If
                                         any part of this Note is unenforceable, all other parts remain in effect.



 


		F.	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:



 


If
the SBA is not the holder, this Note shall be governed by and construed in accordance with the laws of the State of
California where the main office of Lender is located. MATTERS REGARDING INTEREST TO BE CHARGED BY LENDER AND THE EXPORTATION
OF INTEREST SHALL BE GOVERNED BY FEDERAL LAW (INCLUDING WITHOUT LIMITATION 12 U.S.C. SECTIONS 85 AND 1831(u) AND THE LAW OF
THE STATE OF CALIFORNIA. Borrower agrees that any legal action or proceeding with respect to any of its obligations under
this Note may be brought by Lender in any state or federal court located in the State of California, as Lender in its sole
discretion may elect. Borrower submits to and accepts in respect of its property, generally and unconditionally, the
non-exclusive jurisdiction of those courts. Borrower waives any claim that the State of California is not a convenient forum
or the proper venue for any such suit, action or proceeding. The extension of credit that is the subject of this Note is
being made by Lender in California.


 

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	11.	BORROWER’S
                                         NAME(S) AND SIGNATURE(S).



 


BORROWER
CERTIFIES THAT THE INFORMATION PROVIDED IN THIS APPLICATION AND THE INFORMATION PROVIDED IN ALL SUPPORTING DOCUMENTS AND
FORMS IS TRUE AND ACCURATE IN ALL MATERIAL RESPECTS. BORROWER UNDERSTANDS THAT KNOWINGLY MAKING A FALSE STATEMENT TO OBTAIN A
GUARANTEED LOAN FROM SBA IS PUNISHABLE UNDER THE LAW, INCLUDING UNDER 18 USC 1001 AND 3571 BY IMPRISONMENT OF NOT MORE THAN
FIVE YEARS AND/OR A FINE OF UP TO $250,000; UNDER 15 USC 645 BY IMPRISONMENT OF NOT MORE THAN TWO YEARS AND/OR A FINE OF NOT
MORE THAN $5,000; AND, IF SUBMITTED TO A FEDERALLY INSURED INSTITUTION, UNDER 18 USC 1014 BY IMPRISONMENT OF NOT MORE THAN
THIRTY YEARS AND/OR A FINE OF NOT MORE THAN $1,000,000.


 


By
signing below, each individual or entity becomes obligated under this Note as Borrower.


 


Funds will be
credited to your Deposit


Account Number ending
in:


		 	 
	 	BORROWER:
	 	 	 
		By:	 
	 	 	 
		Name:  	paul diperna
	 	 	 
		Title:	Authorized Signer
	 	 	 
	 	Date:	4/23/2020



 

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