Document:

Exhibit 4.5

 

DESCRIPTION OF THE REGISTRANT’S SECURITIES

REGISTERED PURSUANT TO SECTION 12 OF THE

SECURITIES EXCHANGE ACT OF 1934

 

The following summary of
the material terms of certain securities of D and Z Media Acquisition Corp., a Delaware corporation (“we,” “us,”
“our” or “the company”), is not intended to be a complete summary of the rights and preferences of such securities
and is subject to and qualified by reference to our amended and restated certificate of incorporation, our bylaws and the warrant agreement,
dated January 25, 2021, between the company and Continental Stock Transfer & Trust Company (the “Warrant Agreement”),
in each case incorporated by reference as exhibits to the company’s Annual Report on Form 10-K (the “Report”) of which
this exhibit is a part, and applicable Delaware law, including the Delaware General Corporation Law (the “DGCL”).

 

As of the end of the period
covered by the Report, we had the following three classes of securities registered under Section 12 of the Securities Exchange Act of
1934, as amended (the “Exchange Act”): (i) units, each consisting of one share of Class A common stock and one-third of one
warrant, (ii) Class A common stock, par value $0.0001 per share, and (iii) warrants, each whole warrant exercisable for one share of Class
A common stock at an exercise price of $11.50. This exhibit also references the company’s Class B common stock, par value $0.0001
per share (“Class B common stock” or “founder shares”), which is not registered pursuant to Section 12 of the
Exchange Act but is convertible into Class A common stock. The description of the Class B common stock is included to assist in the description
of the Class A common stock. Unless the context otherwise requires, references to our “sponsor” are to D and Z Media Holdings
LLC, a Delaware limited liability company, and references to our “initial stockholders” are to holders of our founder shares
prior to our initial public offering. Terms used but not defined herein shall have the meaning ascribed to such terms in the Report.

 

General

 

Pursuant to our amended and
restated certificate of incorporation, our authorized capital stock consists of 200,000,000 shares of Class A common stock, par value
$0.0001 per share, 20,000,000 shares of Class B common stock, par value $0.0001 per share, and 1,000,000 shares of preferred stock, par
value $0.0001 per share.

 

Our units, Class A common
stock and warrants are listed on the New York Stock Exchange (“NYSE”) under the symbols “DNZ.U,” “DNZ”
and “DNZ WS,” respectively.

 

Units

 

Each unit consists of one
whole share of Class A common stock and one-third of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase
one share of Class A common stock at a price of $11.50 per share, subject to adjustment. Pursuant to the Warrant Agreement, a warrant
holder may exercise its warrants only for a whole number of shares of Class A common stock. This means only a whole warrant may be exercised
at any given time by a warrant holder. For example, if a warrant holder holds one-third or two-thirds of one warrant to purchase a share
of Class A common stock, such warrant will not be exercisable. If a warrant holder holds three-thirds of one warrant, such whole warrant
will be exercisable for one share of Class A common stock at a price of $11.50 per share.

 

The Class A common stock
and warrants comprising the units commenced separate trading on March 18, 2021. Holders have the option to continue to hold units or separate
their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the
units into shares of Class A common stock and warrants. No fractional warrants will be issued upon separation of the units and only whole
warrants will trade.

 

Common Stock

 

Stockholders of record are
entitled to one vote for each share held on all matters to be voted on by stockholders. Holders of Class A common stock and holders of
Class B common stock will vote together as a single class on all matters submitted to a vote of our stockholders except as required by
law. Unless specified in our amended and restated certificate of incorporation, or as required by applicable provisions of the DGCL or
applicable stock exchange rules, the affirmative vote of a majority of our shares of common stock that are voted is required to approve
any such matter voted on by our stockholders. Our board of directors is divided into three classes, each of which will generally serve
for a term of three years (except for those directors appointed prior to our first annual meeting of stockholders) with only one class
of directors being elected in each year. There is no cumulative voting with respect to the election of directors, with the result that
the holders of more than 50% of the shares voted for the election of directors can elect all of the directors. Our stockholders are entitled
to receive ratable dividends when, as and if declared by the board of directors out of funds legally available therefor.

 

     

     

    

 

Because our amended and restated
certificate of incorporation authorizes the issuance of up to 200,000,000 shares of Class A common stock, if we were to enter into a business
combination, we may (depending on the terms of such a business combination) be required to increase the number of shares of Class A common
stock which we are authorized to issue at the same time as our stockholders vote on the business combination to the extent we seek stockholder
approval in connection with our initial business combination.

 

In accordance with the NYSE
corporate governance requirements, we are not required to hold an annual meeting until no later than one year after our first full fiscal
year end following our listing on the NYSE. Under Section 211(b) of the DGCL, we are, however, required to hold an annual meeting of stockholders
for the purposes of electing directors in accordance with our bylaws, unless such election is made by written consent in lieu of such
a meeting. We may not hold an annual meeting of stockholders to elect new directors prior to the consummation of our initial business
combination, and thus we may not be in compliance with Section 211(b) of the DGCL, which requires an annual meeting. Therefore, if our
stockholders want us to hold an annual meeting prior to the consummation of our initial business combination, they may attempt to force
us to hold one by submitting an application to the Delaware Court of Chancery in accordance with Section 211(c) of the DGCL.

 

We will provide our public
stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination
at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account calculated as of two business
days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and
not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations described
herein. The per share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting
commissions we will pay to the underwriters of our initial public offering. Our initial stockholders, officers, and directors have entered
into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares
and public shares they hold in connection with the completion of our initial business combination. Unlike many special purpose acquisition
companies that hold stockholder votes and conduct proxy solicitations in conjunction with their initial business combinations and provide
for related redemptions of public shares for cash upon completion of such initial business combinations even when a vote is not required
by law, if a stockholder vote is not required by law and we do not decide to hold a stockholder vote for business or other legal reasons,
we will, pursuant to our amended and restated certificate of incorporation, conduct the redemptions pursuant to the tender offer rules
of the SEC, and file tender offer documents with the SEC prior to completing our initial business combination. Our amended and restated
certificate of incorporation requires these tender offer documents to contain substantially the same financial and other information about
our initial business combination and the redemption rights as is required under the SEC’s proxy rules. If, however, a stockholder
approval of the transaction is required by law, or we decide to obtain stockholder approval for business or other legal reasons, we will,
like many special purpose acquisition companies, offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy
rules and not pursuant to the tender offer rules. If we seek stockholder approval, we will complete our initial business combination only
if a majority of the shares of common stock voted are voted in favor of our initial business combination. However, the participation of
our sponsor, officers, directors, advisors or their affiliates in privately-negotiated transactions, if any, could result in the approval
of our initial business combination even if a majority of our public stockholders vote, or indicate their intention to vote, against such
initial business combination. For purposes of seeking approval of the majority of our outstanding shares of common stock, non-votes will
have no effect on the approval of our initial business combination once a quorum is obtained.

 

If we seek stockholder approval
of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to
the tender offer rules, our amended and restated certificate of incorporation provides that a public stockholder, together with any affiliate
of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined under
Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares
sold in our initial public offering without our prior consent, which we refer to as the “Excess Shares.” However, we would
not be restricting our stockholders’ ability to vote all of their shares (including Excess Shares) for or against our initial business
combination. Our stockholders’ inability to redeem the Excess Shares will reduce their influence over our ability to complete our
initial business combination, and such stockholders could suffer a material loss in their investment if they sell such Excess Shares on
the open market. Additionally, such stockholders will not receive redemption distributions with respect to the Excess Shares if we complete
our initial business combination. And, as a result, such stockholders will continue to hold that number of shares exceeding 15% and, in
order to dispose such shares would be required to sell their shares in open market transactions, potentially at a loss.

 

If we seek stockholder approval
in connection with our initial business combination, our initial stockholders, officers and directors have agreed to vote any founder
shares they hold and any public shares they may purchase (including in open market and privately-negotiated transactions) in favor
of our initial business combination. As a result, in addition to our initial stockholders’ founder shares, we would need only 10,781,251,
or 37.5%, of the 28,750,000 public shares sold in our initial public offering to be voted in favor of an initial business combination
(assuming all outstanding shares are voted) in order to have our initial business combination approved. Additionally, each public stockholder
may elect to redeem their public shares irrespective of whether they vote for or against the proposed transaction.

 

    2

     

    

 

Pursuant to our amended and
restated certificate of incorporation, if we are unable to complete our initial business combination by January 28, 2023, we will (i)
cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but no more than ten business days
thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust
account, including interest earned on the funds held in the trust account and not previously released to us (less taxes payable and up
to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely
extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any),
and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our
board of directors, liquidate and dissolve, subject in each case to our obligations under Delaware law to provide for claims of creditors
and the requirements of other applicable law. Our initial stockholders have entered into agreements with us, pursuant to which they have
agreed to waive their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete
our initial business combination by January 28, 2023 or during any extended time that we have to consummate a business combination beyond
January 28, 2023 as a result of a stockholder vote to amend our amended and restated certificate of incorporation (an “Extension
Period”). However, if our initial stockholders or management team acquire public shares, they will be entitled to liquidating distributions
from the trust account with respect to such public shares if we fail to complete our initial business combination within the prescribed
time period.

 

In the event of a liquidation,
dissolution or winding up of the company after a business combination, our stockholders are entitled to share ratably in all assets remaining
available for distribution to them after payment of liabilities and after provision is made for each class of shares, if any, having preference
over the common stock. Our stockholders have no preemptive or other subscription rights. There are no sinking fund provisions applicable
to the common stock, except that we will provide our public stockholders with the opportunity to redeem their public shares for cash at
a per share price equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the
trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, upon the completion
of our initial business combination, subject to the limitations described herein.

 

Founder Shares

 

The founder shares are designated
as Class B common stock and, except as described below, are identical to the shares of Class A common stock included in the units sold
in our initial public offering, and holders of founder shares have the same stockholder rights as public stockholders, except that (i)
the founder shares are subject to certain transfer restrictions, as described in more detail below, (ii) our initial stockholders, officers
and directors have entered into a letter agreement with us, pursuant to which they have agreed (A) to waive their redemption rights with
respect to any founder shares and public shares they hold in connection with the completion of our initial business combination, (B) to
waive their redemption rights with respect to any founder shares and public shares they hold in connection with a stockholder vote to
approve an amendment to our amended and restated certificate of incorporation to modify the substance or timing of our obligation to redeem
100% of our public shares if we have not consummated an initial business combination by January 28, 2023 or with respect to any other
material provisions relating to stockholders’ rights or pre-initial business combination activity and (C) to waive their rights
to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to complete our initial business
combination by January 28, 2023 or during any Extension Period, although they will be entitled to liquidating distributions from the trust
account with respect to any public shares they hold if we fail to complete our initial business combination within such time period, and
(iii) the founder shares are automatically convertible into Class A common stock concurrently with or immediately following the consummation
of our initial business combination on a one-for-one basis, subject to adjustment as described herein and in our amended and restated
certificate of incorporation. If we submit our initial business combination to our public stockholders for a vote, our initial stockholders
have agreed to vote their founder shares and any public shares they may purchase (including in open market and privately-negotiated transactions)
in favor of our initial business combination.

 

The founder shares will automatically
convert into shares of Class A common stock concurrently with or immediately following the consummation of our initial business combination
on a one-for-one basis, subject to adjustment for stock splits, stock dividends, reorganizations, recapitalizations and the like, and
subject to further adjustment as provided herein. In the case that additional shares of Class A common stock or equity-linked securities
are issued or deemed issued in connection with our initial business combination, the number of shares of Class A common stock issuable
upon conversion of all founder shares will equal, in the aggregate, on an as-converted basis, 20% of the total number of shares of Class
A common stock outstanding after such conversion (after giving effect to any redemptions of shares of Class A common stock by public stockholders),
including the total number of shares of Class A common stock issued, or deemed issued or issuable upon conversion or exercise of any equity-linked
securities or rights issued or deemed issued, by our company in connection with or in relation to the consummation of the initial business
combination, excluding any shares of Class A common stock or equity-linked securities or rights exercisable for or convertible into shares
of Class A common stock issued, or to be issued, to any seller in the initial business combination and any private placement warrants
issued to our sponsor, officers or directors upon conversion of working capital loans, provided that such conversion of founder shares
will never occur on a less than one-for-one basis.

 

    3

     

    

 

With certain limited exceptions,
the founder shares are not transferable, assignable or salable (except to our officers and directors and other persons or entities affiliated
with our sponsor, each of whom will be subject to the same transfer restrictions) until the earlier of (A) one year after the completion
of our initial business combination or earlier if, subsequent to our initial business combination, the closing price of the Class A common
stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock capitalizations, reorganizations, recapitalizations and
the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination,
and (B) the date following the completion of our initial business combination on which we complete a liquidation, merger, capital stock
exchange or other similar transaction that results in all of our stockholders having the right to exchange their Class A common stock
for cash, securities or other property.

 

Preferred Stock

 

Our amended and restated
certificate of incorporation provides that shares of preferred stock may be issued from time to time in one or more series. Our board
of directors is authorized to fix the voting rights, if any, designations, powers, preferences, the relative, participating, optional
or other special rights and any qualifications, limitations and restrictions thereof, applicable to the shares of each series. Our board
of directors is able to, without stockholder approval, issue shares of preferred stock with voting and other rights that could adversely
affect the voting power and other rights of the holders of the common stock and could have anti-takeover effects. The ability of our board
of directors to issue shares of preferred stock without stockholder approval could have the effect of delaying, deferring or preventing
a change of control of us or the removal of existing management. Although we do not currently intend to issue any shares of preferred
stock, we cannot assure you that we will not do so in the future.

 

Warrants

 

Public Stockholders’ Warrants

 

Each whole warrant entitles
the registered holder to purchase one share of Class A common stock at a price of $11.50 per share, subject to adjustment as discussed
below, at any time commencing 30 days after the completion of our initial business combination, provided in each case that we have an
effective registration statement under the Securities Act of 1933, as amended (the “Securities Act”) covering the shares of
Class A common stock issuable upon exercise of the warrants and a current prospectus relating to them is available (or we permit holders
to exercise their warrants on a cashless basis under the circumstances specified in the Warrant Agreement) and such shares are registered,
qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder. Pursuant to the
Warrant Agreement, a warrant holder may exercise its warrants only for a whole number of shares of Class A common stock. This means only
a whole warrant may be exercised at a given time by a warrant holder. No fractional warrants will be issued upon separation of the units
and only whole warrants will trade. The warrants will expire five years after the completion of our initial business combination, at 5:00
p.m., New York City time, or earlier upon redemption or liquidation.

 

We will not be obligated
to deliver any Class A common stock pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise
unless a registration statement under the Securities Act with respect to the Class A common stock underlying the warrants is then effective
and a prospectus relating thereto is current, subject to our satisfying our obligations described below with respect to registration.
No warrant will be exercisable and we will not be obligated to issue a share of Class A common stock upon exercise of a warrant unless
the share of Class A common stock issuable upon such warrant exercise has been registered, qualified or deemed to be exempt under the
securities laws of the state of residence of the registered holder of the warrants. In the event that the conditions in the two immediately
preceding sentences are not satisfied with respect to a warrant, the holder of such warrant will not be entitled to exercise such warrant
and such warrant may have no value and expire worthless. In no event will we be required to net cash settle any warrant. In the event
that a registration statement is not effective for the exercised warrants, the purchaser of a unit containing such warrant will have paid
the full purchase price for the unit solely for the share of Class A common stock underlying such unit.

 

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We have agreed that as soon
as practicable, but in no event later than fifteen (15) business days after the closing of our initial business combination, we will use
our best efforts to file with the SEC a registration statement for the registration, under the Securities Act, of the Class A common stock
issuable upon exercise of the warrants. We will use our best efforts to cause the same to become effective and to maintain the effectiveness
of such registration statement, and a current prospectus relating thereto, until the expiration of the warrants in accordance with the
provisions of the Warrant Agreement. If a registration statement covering the shares of Class A common stock issuable upon exercise of
the warrants is not effective by the sixtieth (60th) business day after the closing of our initial business combination, warrant holders
may, until such time as there is an effective registration statement and during any period when we will have failed to maintain an effective
registration statement, exercise warrants on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act or
another exemption. Notwithstanding the above, if our shares of Class A common stock are at the time of any exercise of a warrant not listed
on a national securities exchange such that they satisfy the definition of a “covered security” under Section 18(b)(1) of
the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a “cashless
basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or
maintain in effect a registration statement, and in the event we do not so elect, we will use our best efforts to register or qualify
the shares under applicable blue sky laws to the extent an exemption is not available.

 

Redemption of warrants for cash

 

Once the warrants become
exercisable, we may call the warrants for redemption for cash:

 

		●	in whole and not in part;

 

		●	at a price of $0.01 per warrant;

 

		●	upon not less than 30 days’ prior written notice of redemption to each warrant holder; and

 

		●	if, and only if, the closing price of the common stock equals or exceeds $18.00 per share (as adjusted
for stock splits, stock capitalizations, reorganizations, recapitalizations and the like and for certain issuances of Class A common stock
and equity-linked securities for capital raising purposes in connection with the closing of our initial business combination) for
any 20 trading days within a 30-trading day period ending three business days before we send to the notice of redemption to the warrant
holders.

 

If and when the warrants
become redeemable by us for cash, we may exercise our redemption right even if we are unable to register or qualify the underlying securities
for sale under all applicable state securities laws.

 

We have established the last
of the redemption criterion discussed above to prevent a redemption call unless there is at the time of the call a significant premium
to the warrant exercise price. If the foregoing conditions are satisfied and we issue a notice of redemption of the warrants, each warrant
holder will be entitled to exercise his, her or its warrants prior to the scheduled redemption date. However, the price of the Class A
common stock may fall below the $18.00 redemption trigger price (as adjusted for stock splits, stock capitalizations, reorganizations,
recapitalizations and the like and for certain issuances of Class A common stock and equity-linked securities for capital raising
purposes in connection with the closing of our initial business combination) as well as the $11.50 warrant exercise price after the redemption
notice is issued.

 

Redemption procedures and cashless exercise

 

If we call the warrants for
redemption as described above, our management will have the option to require any holder that wishes to exercise his, her or its warrant
to do so on a “cashless basis.” In determining whether to require all holders to exercise their warrants on a “cashless
basis,” our management will consider, among other factors, our cash position, the number of warrants that are outstanding and the
dilutive effect on our stockholders of issuing the maximum number of shares of Class A common stock issuable upon the exercise of our
warrants. If our management takes advantage of this option, all holders of warrants would pay the exercise price by surrendering their
warrants for that number of shares of Class A common stock equal to the quotient obtained by dividing (x) the product of the number of
Class A common stock underlying the warrants, multiplied by the excess of the “fair market value” of our Class A common stock
(defined below) over the exercise price of the warrants by (y) the fair market value. The “fair market value” will mean the
average closing price of the Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the
notice of redemption is sent to the holders of warrants. If our management takes advantage of this option, the notice of redemption will
contain the information necessary to calculate the number of shares of Class A common stock to be received upon exercise of the warrants,
including the “fair market value” in such case. Requiring a cashless exercise in this manner will reduce the number of shares
to be issued and thereby lessen the dilutive effect of a warrant redemption. We believe this feature is an attractive option to us if
we do not need the cash from the exercise of the warrants after our initial business combination. If we call our warrants for redemption
and our management does not take advantage of this option, the holders of the private placement warrants and their permitted transferees
would still be entitled to exercise their private placement warrants for cash or on a cashless basis using the same formula described
above that other warrant holders would have been required to use had all warrant holders been required to exercise their warrants on a
cashless basis, as described in more detail below.

 

    5

     

    

 

A holder of a warrant may
notify us in writing in the event it elects to be subject to a requirement that such holder will not have the right to exercise such warrant,
to the extent that after giving effect to such exercise, such person (together with such person’s affiliates), to the warrant agent’s
actual knowledge, would beneficially own in excess of 4.9% or 9.8% (as specified by the holder) of the Class A common stock outstanding
immediately after giving effect to such exercise.

 

If the number of outstanding
shares of Class A common stock is increased by a share capitalization payable in shares of Class A common stock, or by a split-up of
common stock or other similar event, then, on the effective date of such share capitalization, split-up or similar event, the number
of shares of Class A common stock issuable on exercise of each warrant will be increased in proportion to such increase in the outstanding
shares of common stock. A rights offering to all or substantially all of the holders of common stock entitling holders to purchase Class
A common stock at a price less than the fair market value will be deemed a share capitalization of a number of shares of Class A common
stock equal to the product of (i) the number of shares of Class A common stock actually sold in such rights offering (or issuable under
any other equity securities sold in such rights offering that are convertible into or exercisable for Class A common stock) and (ii) the
quotient of (x) the price per share of Class A common stock paid in such rights offering and (y) the fair market value. For these purposes
(i) if the rights offering is for securities convertible into or exercisable for shares of Class A common stock, in determining the price
payable for Class A common stock, there will be taken into account any consideration received for such rights, as well as any additional
amount payable upon exercise or conversion and (ii) fair market value means the volume weighted average price of shares of Class A common
stock as reported during the ten (10) trading day period ending on the trading day prior to the first date on which the Class A common
stock trades on the applicable exchange or in the applicable market, regular way, without the right to receive such rights.

 

In addition, if we, at any
time while the warrants are outstanding and unexpired, pay a dividend or make a distribution in cash, securities or other assets to all
or substantially all of the holders of Class A common stock on account of such Class A common stock (or other securities into which the
warrants are convertible), other than (a) as described above, (b) certain ordinary cash dividends, (c) to satisfy the redemption rights
of the holders of Class A common stock in connection with a proposed initial business combination, or (d) in connection with the redemption
of our public shares upon our failure to complete our initial business combination, then the warrant exercise price will be decreased,
effective immediately after the effective date of such event, by the amount of cash and/or the fair market value of any securities or
other assets paid on each share of Class A common stock in respect of such event.

 

If the number of outstanding
shares of Class A common stock is decreased by a consolidation, combination, reverse share split or reclassification of Class A common
stock or other similar event, then, on the effective date of such consolidation, combination, reverse share split, reclassification or
similar event, the number of shares of Class A common stock issuable on exercise of each warrant will be decreased in proportion to such
decrease in outstanding share of Class A common stock.

 

Whenever the number of shares
of Class A common stock purchasable upon the exercise of the warrants is adjusted, as described above, the warrant exercise price will
be adjusted by multiplying the warrant exercise price immediately prior to such adjustment by a fraction (x) the numerator of which will
be the number of shares of Class A common stock purchasable upon the exercise of the warrants immediately prior to such adjustment, and
(y) the denominator of which will be the number of shares of Class A common stock so purchasable immediately thereafter.

 

In addition, if (x) we issue
additional shares of Class A common stock or equity-linked securities for capital raising purposes in connection with the closing
of our initial business combination at an issue price or effective issue price of less than $9.20 per share of Class A common stock (with
such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance
to our initial stockholders or their affiliates, without taking into account any founder shares held by our initial stockholders or such
affiliates, as applicable, prior to such issuance) (the “Newly Issued Price”), (y) the aggregate gross proceeds from such
issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business
combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average
trading price of our Class A common stock during the 20 trading day period starting on the trading day after the day on which we consummate
our initial business combination (such price, the “Market Value”) is below $9.20 per share, the exercise price of the warrants
will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00
per share redemption trigger price described above under “Redemption of warrants for cash” will be adjusted (to the nearest
cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price.

 

    6

     

    

 

In case of any reclassification
or reorganization of the outstanding Class A common stock (other than those described above or that solely affects the par value of such
Class A common stock), or in the case of any merger or consolidation of us with or into another corporation (other than a consolidation
or merger in which we are the continuing corporation and that does not result in any reclassification or reorganization of our outstanding
Class A common stock), or in the case of any sale or conveyance to another corporation or entity of the assets or other property of us
as an entirety or substantially as an entirety in connection with which we are dissolved, the holders of the warrants will thereafter
have the right to purchase and receive, upon the basis and upon the terms and conditions specified in the warrants and in lieu of the
Class A common stock immediately theretofore purchasable and receivable upon the exercise of the rights represented thereby, the kind
and amount of shares of Class A common stock or other securities or property (including cash) receivable upon such reclassification, reorganization,
merger or consolidation, or upon a dissolution following any such sale or transfer, that the holder of the warrants would have received
if such holder had exercised their warrants immediately prior to such event. If less than 70% of the consideration receivable by the holders
of Class A common stock in such a transaction is payable in the form of Class A common stock in the successor entity that is listed for
trading on a national securities exchange or is quoted in an established over-the-counter market, or is to be so listed for trading
or quoted immediately following such event, and if the registered holder of the warrant properly exercises the warrant within thirty days
following public disclosure of such transaction, the warrant exercise price will be reduced as specified in the Warrant Agreement based
on the Black-Scholes Warrant Value (as defined in the Warrant Agreement) of the warrant. The purpose of such exercise price reduction
is to provide additional value to holders of the warrants when an extraordinary transaction occurs during the exercise period of the warrants
pursuant to which the holders of the warrants otherwise do not receive the full potential value of the warrants.

 

The warrants were issued
in registered form under the Warrant Agreement, which provides that the terms of the warrants may be amended without the consent of any
holder for the purpose of (i) curing any ambiguity or to correct any defective provision or mistake, including to conform the provisions
of the Warrant Agreement to the description of the terms of the warrants and the Warrant Agreement set forth in our final prospectus,
(ii) adjusting the provisions relating to cash dividends on shares of common stock as contemplated by and in accordance with the Warrant
Agreement or (iii) adding or changing any provisions with respect to matters or questions arising under the Warrant Agreement as the parties
to the Warrant Agreement may deem necessary or desirable and that the parties deem to not adversely affect the rights of the registered
holders of the warrants, provided that the approval by the holders of at least 50% of the then outstanding public warrants is required
to make any change that adversely affects the interests of the registered holders of public warrants, and, solely with respect to any
amendment to the terms of the private placement warrants, 50% of the then outstanding private placement warrants.

 

The warrants may be exercised
upon surrender of the warrant certificate on or prior to the expiration date at the offices of the warrant agent, with the exercise form
on the reverse side of the warrant certificate completed and executed as indicated, accompanied by full payment of the exercise price
(or on a cashless basis, if applicable), by certified or official bank check payable to us, for the number of warrants being exercised.
The warrant holders do not have the rights or privileges of holders of common stock and any voting rights until they exercise their warrants
and receive Class A common stock. After the issuance of Class A common stock upon exercise of the warrants, each holder will be entitled
to one vote for each share held of record on all matters to be voted on by stockholders.

 

No fractional shares will
be issued upon exercise of the warrants. If, upon exercise of the warrants, a holder would be entitled to receive a fractional interest
in a share, we will, upon exercise, round down to the nearest whole number the number of shares of Class A common stock to be issued to
the warrant holder.

 

The Warrant Agreement provides
that, subject to applicable law, (i) any action, proceeding or claim against us arising out of or relating in any way to the Warrant Agreement,
including under the Securities Act, will be brought and enforced in the courts of the State of New York or the United States District
Court for the Southern District of New York, and (ii) that we irrevocably submit to such jurisdiction, which jurisdiction shall be the
exclusive forum for any such action, proceeding or claim. We will waive any objection to such exclusive jurisdiction and that such courts
represent an inconvenient forum.

 

Notwithstanding the foregoing,
these provisions of the Warrant Agreement will not apply to suits brought to enforce any liability or duty created by the Exchange Act
or any other claim for which the federal district courts of the United States of America are the sole and exclusive forum. Any person
or entity purchasing or otherwise acquiring any interest in any of our warrants shall be deemed to have notice of and to have consented
to the forum provisions in the Warrant Agreement. If any action, the subject matter of which is within the scope of the forum provisions
of the Warrant Agreement, is filed in a court other than a court of the State of New York or the United States District Court for the
Southern District of New York (a “foreign action”) in the name of any holder of our warrants, such holder shall be deemed
to have consented to: (x) the personal jurisdiction of the state and federal courts located in the State of New York in connection with
any action brought in any such court to enforce the forum provisions (an “enforcement action”), and (y) having service of
process made upon such warrant holder in any such enforcement action by service upon such warrant holder’s counsel in the foreign
action as agent for such warrant holder.

 

    7

     

    

 

Private Placement Warrants

 

The private placement warrants
(including the Class A common stock issuable upon exercise of the private placement warrants) will not be transferable, assignable or
salable until 30 days after the completion of our initial business combination (except, among other limited exceptions, to our officers
and directors and other persons or entities affiliated with the initial purchasers of the private placement warrants) and they will not
be redeemable by us for cash so long as they are held by the initial purchasers or their permitted transferees. The initial purchasers,
or their permitted transferees, have the option to exercise the private placement warrants on a cashless basis. Except as described in
this section, the private placement warrants have terms and provisions that are identical to those of the warrants sold as part of the
units in our initial public offering. The private placement warrants held by Loop Capital Markets LLC, one of the underwriters of our
initial public offering (“Loop Capital”), will not be exercisable after January 25, 2026. If the private placement warrants
are held by holders other than the initial purchasers or their permitted transferees, the private placement warrants will be redeemable
by us and exercisable by the holders on the same basis as the warrants included in the units sold in our initial public offering.

 

If holders of the private
placement warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering his, her or its warrants
for that number of shares of Class A common stock equal to the quotient obtained by dividing (x) the product of the number of shares of
Class A common stock underlying the warrants, multiplied by the excess of the “fair market value” of our Class A common stock
(defined below) over the exercise price of the warrants by (y) the fair market value. The “fair market value” will mean the
average closing price of the Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the
notice of warrant exercise is sent to the warrant agent. The reason that we have agreed that these warrants will be exercisable on a cashless
basis so long as they are held by the initial purchasers or their permitted transferees is because it is not known at this time whether
they will be affiliated with us following a business combination. If they remain affiliated with us, their ability to sell our securities
in the open market will be significantly limited. We expect to have policies in place that prohibit insiders from selling our securities
except during specific periods of time. Even during such periods of time when insiders will be permitted to sell our securities, an insider
cannot trade in our securities if he or she is in possession of material non-public information. Accordingly, unlike public stockholders
who could exercise their warrants and sell the shares of Class A common stock received upon such exercise freely in the open market in
order to recoup the cost of such exercise, the insiders could be significantly restricted from selling such securities. As a result, we
believe that allowing the holders to exercise such warrants on a cashless basis is appropriate.

 

In order to finance transaction
costs in connection with an intended initial business combination, our sponsor or an affiliate of our sponsor or certain of our officers
and directors may, but are not obligated to, loan us funds as may be required. Up to $1,500,000 of such loans may be convertible into
warrants of the post business combination entity at a price of $1.50 per warrant at the option of the lender. Such warrants would be identical
to the private placement warrants.

 

Our initial stockholders
have agreed not to transfer, assign or sell any of the private placement warrants (including the Class A common stock issuable upon exercise
of any of these warrants) until the date that is 30 days after the date we complete our initial business combination, except that, among
other limited exceptions, transfers can be made to our officers and directors and other persons or entities affiliated with our sponsor.

 

Dividends

 

We have not paid any cash
dividends on our common stock to date and do not intend to pay cash dividends prior to the completion of a business combination. The payment
of cash dividends in the future will be dependent upon our revenues and earnings, if any, capital requirements and general financial condition
subsequent to completion of a business combination. The payment of any cash dividends subsequent to a business combination will be within
the discretion of our board of directors at such time. Further, if we incur any indebtedness, our ability to declare dividends may be
limited by restrictive covenants we may agree to in connection therewith.

 

Our Transfer Agent and Warrant Agent

 

The transfer agent for our
common stock and warrant agent for our warrants is Continental Stock Transfer & Trust Company. We have agreed to indemnify Continental
Stock Transfer & Trust Company in its roles as transfer agent and warrant agent, its agents and each of its stockholders, directors,
officers and employees against all claims and losses that may arise out of acts performed or omitted for its activities in that capacity,
except for any liability due to any gross negligence or intentional misconduct of the indemnified person or entity. Continental Stock
Transfer & Trust Company has agreed that it has no right of set-off or any right, title, interest or claim of any kind to, or to any
monies in, the trust account, and has irrevocably waived any right, title, interest or claim of any kind to, or to any monies in, the
trust account that it may have now or in the future. Accordingly, any indemnification provided will only be able to be satisfied, or a
claim will only be able to be pursued, solely against us and our assets outside the trust account and not against the any monies in the
trust account or interest earned thereon.

 

    8

     

    

 

Amended and Restated Certificate of Incorporation

 

Our amended and restated
certificate of incorporation contains certain requirements and restrictions relating to our initial public offering that will apply to
us until the completion of our initial business combination. These provisions cannot be amended without the approval of the holders of
65% of our common stock. Our initial stockholders may participate in any vote to amend our amended and restated certificate of incorporation
and will have the discretion to vote in any manner they choose. Specifically, our amended and restated certificate of incorporation provides,
among other things, that:

 

		●	If we are unable to complete our initial business
combination by January 28, 2023, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably
possible but no more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the
aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously
released to us (less taxes payable and up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding
public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive
further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval
of our remaining stockholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under Delaware
law to provide for claims of creditors and in all cases subject to the requirements of other applicable law;

 

		●	Prior to our initial business combination, we
may not issue additional securities that would entitle the holders thereof to (i) receive funds from the trust account or (ii) vote as
a class with our public shares (a) on our initial business combination or (b) to approve an amendment to our amended and restated certificate
of incorporation to (x) extend the time we have to consummate a business combination beyond January 28, 2023 or (y) amend the foregoing
provisions;

 

		●	Although we do not intend to enter into a business
combination with a target business that is affiliated with our sponsor, our directors or our executive officers, we are not prohibited
from doing so. In the event we enter into such a transaction, we, or a committee of independent directors, will obtain an opinion from
an independent investment banking firm which is a member of FINRA or an independent accounting firm that such a business combination is
fair to our company from a financial point of view;

 

		●	If a stockholder vote on our initial business
combination is not required by law and we do not decide to hold a stockholder vote for business or other legal reasons, we will offer
to redeem our public shares pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, and will file tender offer documents with the
SEC prior to completing our initial business combination which contain substantially the same financial and other information about our
initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act. Whether or not we maintain
our registration under the Exchange Act or our listing on the NYSE, we will provide our public stockholders with the opportunity to redeem
their public shares by one of the two methods listed above;

 

		●	Our amended and restated certificate of incorporation
and the NYSE rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80%
of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest
earned on the trust account) at the time of the agreement to enter into the initial business combination;

 

		●	If our stockholders approve an amendment to our
amended and restated certificate of incorporation to modify the substance or timing of our obligation to redeem 100% of our public shares
if we do not complete our initial business combination by January 28, 2023, or with respect to any other material provisions relating
to stockholders’ rights or pre-initial business combination activity, we will provide our public stockholders with the opportunity
to redeem all or a portion of their Class A common stock upon such approval at a per-share price, payable in cash, equal to the aggregate
amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released
to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations described herein; and

 

    9

     

    

 

		●	We will not effectuate our initial business combination
with another blank check company or a similar company with nominal operations.

 

In addition, our amended
and restated certificate of incorporation provides that under no circumstances will we redeem our public shares in an amount that would
cause our net tangible assets to be less than $5,000,001.

 

Certain Anti-Takeover Provisions of Delaware
Law and our Amended and Restated Certificate of Incorporation and Bylaws

 

We are subject to the provisions
of Section 203 of the DGCL regulating corporate takeovers. This statute prevents certain Delaware corporations, under certain circumstances,
from engaging in a “business combination” with:

 

		●	a stockholder who owns 15% or more of our outstanding
voting stock (otherwise known as an “interested stockholder”);

 

		●	an affiliate of an interested stockholder; or

 

		●	an associate of an interested stockholder, for
three years following the date that the stockholder became an interested stockholder.

 

A “business combination”
includes a merger or sale of more than 10% of our assets. However, the above provisions of Section 203 do not apply if:

 

		●	our board of directors approves the transaction
that made the stockholder an “interested stockholder,” prior to the date of the transaction;

 

		●	after the completion of the transaction that
resulted in the stockholder becoming an interested stockholder, that stockholder owned at least 85% of our voting stock outstanding at
the time the transaction commenced, other than statutorily excluded shares of common stock; or

 

		●	on or subsequent to the date of the transaction,
the initial business combination is approved by our board of directors and authorized at a meeting of our stockholders, and not by written
consent, by an affirmative vote of at least two-thirds of the outstanding voting stock not owned by the interested stockholder.

 

Our amended and restated
certificate of incorporation provides that our board of directors is classified into three classes of directors. As a result, in most
circumstances, a person can gain control of our board only by successfully engaging in a proxy contest at two or more annual meetings.

 

Our authorized but unissued
common stock and preferred stock are available for future issuances without stockholder approval and could be utilized for a variety of
corporate purposes, including future offerings to raise additional capital, acquisitions and employee benefit plans. The existence of
authorized but unissued and unreserved common stock and preferred stock could render more difficult or discourage an attempt to obtain
control of us by means of a proxy contest, tender offer, merger or otherwise.

 

Exclusive forum for certain lawsuits

 

Our amended and restated
certificate of incorporation requires, unless we consent in writing to the selection of an alternative forum, that (i) any derivative
action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer
or other employee to us or our stockholders, (iii) any action asserting a claim against us, our directors, officers or employees arising
pursuant to any provision of the DGCL or our amended and restated certificate of incorporation or bylaws, or (iv) any action asserting
a claim against us, our directors, officers or employees governed by the internal affairs doctrine may be brought only in the Court of
Chancery in the State of Delaware, except any claim (A) as to which the Court of Chancery of the State of Delaware determines that there
is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the
personal jurisdiction of the Court of Chancery within ten days following such determination), (B) which is vested in the exclusive jurisdiction
of a court or forum other than the Court of Chancery or (C) for which the Court of Chancery does not have subject matter jurisdiction,
as to which the Court of Chancery and the federal district court for the District of Delaware shall have concurrent jurisdiction. If an
action is brought outside of Delaware, the stockholder bringing the suit will be deemed to have consented to service of process on such
stockholder’s counsel.

 

    10

     

    

 

Although we believe this
provision benefits us by providing increased consistency in the application of Delaware law in the types of lawsuits to which it applies,
a court may determine that this provision is unenforceable, and to the extent it is enforceable, the provision may have the effect of
discouraging lawsuits against our directors and officers, although our stockholders will not be deemed to have waived our compliance with
federal securities laws and the rules and regulations thereunder.

 

Notwithstanding the foregoing,
our amended and restated certificate of incorporation provides that the exclusive forum provision will not apply to suits brought to enforce
a duty or liability created by the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction. Section 27
of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange
Act or the rules and regulations thereunder. Additionally, unless we consent in writing to the selection of an alternative forum, the
federal courts shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities
Act against us or any of our directors, officers, other employees or agents. Section 22 of the Securities Act, however, created concurrent
jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the
rules and regulations thereunder. Accordingly, there is uncertainty as to whether a court would enforce such provisions, and the enforceability
of similar choice of forum provisions in other companies’ charter documents has been challenged in legal proceedings. While the
Delaware courts have determined that such exclusive forum provisions are facially valid, a stockholder may nevertheless seek to bring
a claim in a venue other than those designated in the exclusive forum provisions, and there can be no assurance that such provisions will
be enforced by a court in those other jurisdictions. Any person or entity purchasing or otherwise acquiring any interest in our securities
shall be deemed to have notice of and consented to these provisions; however, we note that investors cannot waive compliance with the
federal securities laws and the rules and regulations thereunder.

 

Special meeting of stockholders

 

Our bylaws provide that special
meetings of our stockholders may be called only by a majority vote of our board of directors, by our Chief Executive Officer or by our
Chairman.

 

Advance notice requirements for stockholder
proposals and director nominations

 

Our bylaws provide that stockholders
seeking to bring business before our annual meeting of stockholders, or to nominate candidates for election as directors at our annual
meeting of stockholders, must provide timely notice of their intent in writing. To be timely, a stockholder’s notice will need to
be received by the company secretary at our principal executive offices not later than the close of business on the 90th day nor earlier
than the opening of business on the 120th day prior to the anniversary date of the immediately preceding annual meeting of stockholders.
Pursuant to Rule 14a-8 of the Exchange Act, proposals seeking inclusion in our annual proxy statement must comply with the notice
periods contained therein. Our bylaws also specify certain requirements as to the form and content of a stockholders’ meeting. These
provisions may preclude our stockholders from bringing matters before our annual meeting of stockholders or from making nominations for
directors at our annual meeting of stockholders.

 

Action by written consent

 

Any action required or permitted
to be taken by our common stockholders must be effected by a duly called annual or special meeting of such stockholders and may not be
effected by written consent of the stockholders other than with respect to our Class B common stock.

 

Classified Board of Directors

 

Our board of directors is
divided into three classes, Class I, Class II, and Class III, with members of each class serving staggered three-year terms. Our
amended and restated certificate of incorporation provides that the authorized number of directors may be changed only by resolution of
the board of directors. Subject to the terms of any preferred stock, any or all of the directors may be removed from office at any time,
but only for cause and only by the affirmative vote of holders of a majority of the voting power of all then outstanding shares of our
capital stock entitled to vote generally in the election of directors, voting together as a single class. Any vacancy on our board of
directors, including a vacancy resulting from an enlargement of our board of directors, may be filled only by vote of a majority of our
directors then in office.

 

    11

     

    

 

Class B Common Stock Consent Right

 

For so long as any shares
of Class B common stock remain outstanding, we may not, without the prior vote or written consent of the holders of a majority of the
shares of Class B common stock then outstanding, voting separately as a single class, amend, alter or repeal any provision of our amended
and restated certificate of incorporation, whether by merger, consolidation or otherwise, if such amendment, alteration or repeal would
alter or change the powers, preferences or relative, participating, optional or other or special rights of the Class B common stock. Any
action required or permitted to be taken at any meeting of the holders of Class B common stock may be taken without a meeting, without
prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders
of the outstanding Class B common stock having not less than the minimum number of votes that would be necessary to authorize or take
such action at a meeting at which all shares of Class B common stock were present and voted.

 

Securities Eligible for Future Sale

 

Immediately after our initial
public offering we had 35,937,500 shares of common stock outstanding. Of these shares, the 28,750,000 shares of Class A common stock
sold in our initial public offering are freely tradable without restriction or further registration under the Securities Act, except for
any Class A common stock purchased by one of our affiliates within the meaning of Rule 144 under the Securities Act. All of the outstanding
7,187,500 founder shares and all of the outstanding 5,100,000 private placement warrants are restricted securities under Rule 144, in
that they were issued in private transactions not involving a public offering.

 

Rule 144

 

Pursuant to Rule 144, a person
who has beneficially owned restricted shares or warrants for at least six months would be entitled to sell their securities provided that
(i) such person is not deemed to have been one of our affiliates at the time of, or at any time during the three months preceding, a sale
and (ii) we are subject to the Exchange Act periodic reporting requirements for at least three months before the sale and have filed all
required reports under Section 13 or 15(d) of the Exchange Act during the 12 months (or such shorter period as we were required to
file reports) preceding the sale.

 

Persons who have beneficially
owned restricted shares or warrants for at least six months but who are our affiliates at the time of, or at any time during the three
months preceding, a sale, would be subject to additional restrictions, by which such person would be entitled to sell within any three-month period
only a number of securities that does not exceed the greater of:

 

		●	1% of the total number of shares of Class A common
stock then outstanding; or

 

		●	the average weekly reported trading volume of
the Class A common stock during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale.

 

    12

     

    

 

Sales by our affiliates under
Rule 144 are also limited by manner of sale provisions and notice requirements and to the availability of current public information about
us.

 

Restrictions on the Use of Rule 144 by Shell
Companies or Former Shell Companies

 

Rule 144 is not available
for the resale of securities initially issued by shell companies (other than business combination related shell companies) or issuers
that have been at any time previously a shell company. However, Rule 144 also includes an important exception to this prohibition if the
following conditions are met:

 

		●	the issuer of the securities that was formerly
a shell company has ceased to be a shell company;

 

		●	the issuer of the securities is subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act;

 

		●	the issuer of the securities has filed all Exchange
Act reports and material required to be filed, as applicable, during the preceding 12 months (or such shorter period that the issuer
was required to file such reports and materials), other than Form 8-K reports; and

 

		●	at least one year has elapsed from the time that
the issuer filed current Form 10 type information with the SEC reflecting its status as an entity that is not a shell company.

 

As a result, our initial
stockholders will be able to sell their founder shares and private placement warrants, as applicable, pursuant to Rule 144 without registration
one year after we have completed our initial business combination.

 

Registration Rights

 

The holders of the founder
shares, private placement warrants, and warrants that may be issued upon conversion of working capital loans (and any Class A common stock
issuable upon the exercise of the private placement warrants and warrants that may be issued upon conversion of working capital loans
and upon conversion of the founder shares) are entitled to registration rights pursuant to a registration rights agreement entered into
on January 25, 2021, requiring us to register such securities for resale. The holders of these securities are entitled to make up to three
demands, excluding short form demands, that we register such securities. In addition, the holders have certain “piggy-back”
registration rights with respect to registration statements filed subsequent to our completion of our initial business combination. Notwithstanding
the foregoing, Loop Capital may not exercise its demand and “piggyback” registration rights after January 25, 2026 and January
25, 2028, respectively, and may not exercise its demand rights on more than one occasion. We will bear the expenses incurred in connection
with the filing of any such registration statements.

 

Listing of Securities

 

Our units, Class A common
stock and warrants are listed on the NYSE under the symbols “DNZ.U,” “DNZ” and “DNZ WS,” respectively.

 

 

13EX-10.1

  Exhibit 10.1

   

   

  loan AGREEMENT

  This Agreement dated as of March 31, 2022, is between Bank of America, N.A. (the "Bank") and Thorne HealthTech, Inc., a Delaware corporation (the "Borrower").

  1.definitions

  In addition to the terms which are defined elsewhere in this Agreement, the following terms have the meanings indicated for the purposes of this Agreement:

  1.1	“Beneficial Ownership Certification” means a certification regarding beneficial ownership required by the Beneficial Ownership Regulation.

   

  1.2	“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.

  1.3	"Credit Limit" means the amount of Fifteen Million Dollars ($15,000,000.00).

  1.4	“Guarantor” means any person, if any, providing a guaranty with respect to the obligations hereunder.

  1.5	“Obligor” means any Borrower, Guarantor and/or Pledgor, or if the Borrower is comprised of the trustees of a trust, any trustor.

  1.6	“Pledgor” means any person, if any, providing a pledge of collateral with respect to the obligations hereunder.

  1.7	“Related Party” means each of the Borrower and its subsidiaries.

  2.facility no. 1: line of credit amount and terms

  2.1Line of Credit Amount.

  (a)	During the availability period described below, the Bank will provide a line of credit to the Borrower (the “Line of Credit”).  The amount of the Line of Credit (the "Facility No. 1 Commitment") is Fifteen Million Dollars ($15,000,000.00).

  (b)	This is a revolving line of credit.  During the availability period, the Borrower may repay principal amounts and reborrow them.

  (c)	The Borrower agrees not to permit the principal balance outstanding to exceed the Facility No. 1 Commitment.  If the Borrower exceeds this limit, the Borrower will immediately pay the excess to the Bank upon the Bank's demand.

  2.2Availability Period.

  The Line of Credit is available between the date of this Agreement and March 31, 2027, or such earlier date as the availability may terminate as provided in this Agreement (the "Facility No. 1 Expiration Date").

  The availability period for this Line of Credit will be considered renewed if and only if the Bank has sent to the Borrower a written notice of renewal for the Line of Credit (the “Renewal Notice”).  If this Line of Credit is renewed, it will continue to be subject to all the terms and conditions set forth in this Agreement except as modified by the Renewal Notice.  If this Line of Credit is renewed, the term “Expiration Date” shall mean the date set forth in the Renewal Notice as the Expiration Date.  The same process for renewal will apply to any subsequent renewal of this Line of Credit. 

  2.3Repayment Terms.

  (a)	The Borrower will pay interest on April 30, 2022, and then on the same day of each month thereafter until payment in full of all principal outstanding under this facility.  The amount of each interest payment shall be the amount of 

  

  accrued interest on the Line of Credit as of the interest payment date or such earlier accrual date as indicated on the billing statement for such interest payment.  

  (b)	The Borrower will repay in full all principal, interest or other charges outstanding under this Agreement no later than the Expiration Date.

  (c)	The Borrower may prepay the Line of Credit in full or in part at any time.  The prepayment will be applied to the most remote payment of principal due under this Agreement.

  2.4Interest Rate. 

  (a)	The interest rate is a rate per year equal to the sum of the BSBY Rate (Adjusted Periodically) plus 1.50 percentage point(s). 

  (b)	The interest rate will be adjusted on the first day of each month (the “Adjustment Date”) and remain fixed until the next Adjustment Date.  If the Adjustment Date in any particular month would otherwise fall on a day that is not a banking day then, at the Bank’s option, the Adjustment Date for that particular month will be the first banking day immediately following thereafter.

  (c)	The BSBY Rate (Adjusted Periodically) is a rate of interest equal to the rate per annum equal to the BSBY Screen Rate as determined for each Adjustment Date two (2) Business Days prior to the Adjustment Date (for delivery on the first day of such interest period) with a term of one month; provided that if such rate is not published on such determination date then the rate will be the BSBY Screen Rate on the first Business Day immediately prior thereto.  “BSBY Screen Rate” means the Bloomberg Short-Term Bank Yield Index rate (“BSBY”) administered by Bloomberg Index Services Limited and published on the applicable Reuters screen page (or such other commercially available source providing such quotations as may be designated by the Bank from time to time).  If the BSBY Rate (Adjusted Periodically) is not available at such time for any reason or the Bank makes the determination to incorporate or adopt a new interest rate to replace the BSBY Rate (Adjusted Periodically) in credit agreements, then the Bank may replace the BSBY Rate (Adjusted Periodically) with an alternate interest rate and adjustment, if applicable, as reasonably selected by the Bank, giving due consideration to any evolving or then existing conventions for such interest rate and adjustment (any such successor interest rate, as adjusted, the “Successor Rate”).  In connection with the implementation of the Successor Rate, the Bank will have the right, from time to time, in good faith to make any conforming, technical, administrative or operational changes to this Agreement as may be appropriate to reflect the adoption and administration thereof and, notwithstanding anything to the contrary herein or in any other loan document, any amendments to this Agreement implementing such conforming changes will become effective upon notice to the Borrower without any further action or consent of the other parties hereto. A “Business Day” is a day other than a Saturday or a Sunday on which banks are open for business in the State of New York.  If at any time the BSBY Rate (Adjusted Periodically) or any Successor Rate is less than zero, such rate shall be deemed to be zero for the purposes of this Agreement.

  2.5Letters of Credit.  

  (a)	As a subfacility under the Line of Credit, during the availability period, the Bank agrees from time to time to issue or cause an affiliate to issue commercial and standby letters of credit for the account of the Borrower (each a "Letter of Credit," and collectively "Letters of Credit"); provided however, that the aggregate drawn and undrawn amount of all outstanding Letters of Credit shall not at any time exceed Six Million Dollars ($6,000,000.00). The form and substance of each Letter of Credit shall be subject to approval by the Bank, in its sole discretion.  Each Letter of Credit shall be issued for a term, as designated by the Borrower, not to exceed three hundred sixty-five (365) days; provided however, that no Letter of Credit shall have an expiration date more than three hundred sixty-five (365) days beyond the Facility No. 1 Expiration Date.  The undrawn amount of all Letters of Credit shall be reserved under the Line of Credit and such amount shall not be available for borrowings. Each Letter of Credit shall be subject to the additional terms and conditions of the Letter of Credit agreements, applications and any related documents required by the Bank in connection with the issuance of Letters of Credit. At the option of the Bank, any drawing paid under a Letter of Credit may be deemed an advance under the Line of Credit and shall be repaid by the Borrower in accordance with the terms and conditions of this Agreement applicable to such advances; provided however, that if advances under the Line of Credit are not available, for any reason, at the time any drawing is paid, then the Borrower shall immediately pay to the Bank the full amount drawn, together with interest from the date such drawing is paid to the date such amount is fully repaid by the Borrower, at the rate of interest applicable to advances under the Line of Credit. In such event the Borrower agrees that the Bank, in its sole discretion, may debit any account maintained by the Borrower with the Bank for the amount of any such drawing. The Borrower agrees to deposit in a cash collateral account with the Bank an amount equal to the aggregate outstanding undrawn face amount of all letters of credit which remain outstanding on the Facility No. 1 Expiration Date. The Borrower grants 

  

  a security interest in such cash collateral account to the Bank. Amounts held in such cash collateral account shall be applied by the Bank to the payment of drafts drawn under such letters of credit and to the obligations and liabilities of the Borrower to the Bank, in such order of application as the Bank may in its sole discretion elect.

  3.collateral

  3.1Personal Property.  

  The personal property listed below now owned or owned in the future by the parties listed below will secure the Borrower’s obligations to the Bank under this Agreement or, if the collateral is owned by a Guarantor, will secure the guaranty, if so indicated in the security agreement.  The collateral is further defined in security agreement(s) executed by the owners of the collateral.

  (a)	Equipment and fixtures owned by Borrower.

  (b)	Inventory owned by Borrower.

  (c)	Receivables owned by Borrower.

  (d)	Patents, trademarks and other general intangibles owned by Borrower.  

  4.loan administration and fees

  4.1Fees.

  The Borrower will pay to the Bank the fees set forth on Schedule A.

  4.2Collection of Payments; Payments Generally.  

  (a)	Regularly scheduled interest and principal payments will be made by debit to a deposit account, if direct debit is provided for in this Agreement or is otherwise authorized by the Borrower.  For regularly scheduled interest and principal payments not made by direct debit and for all other payments, such payments will be made by such other method as may be permitted by the Bank.

  (b)	Each disbursement by the Bank and each payment by the Borrower will be evidenced by records kept by the Bank which will, absent manifest error, be conclusively presumed to be correct and accurate and constitute an account stated between the Borrower and the Bank.

  (c)	All payments to be made by the Borrower shall be made free and clear of and without condition or deduction for any counterclaim, defense, recoupment or setoff.

  4.3Borrower’s Instructions.  

  Subject to the terms, conditions and procedures stated elsewhere in this Agreement, the Bank may honor instructions for advances or repayments and any other instructions under this Agreement given by the Borrower (if an individual), or by any one of the individuals the Bank reasonably believes is authorized to sign loan agreements on behalf of the Borrower, or any other individual(s) designated by any one of such authorized signers (each an “Authorized Individual”).  The Bank may honor any such instructions made by any one of the Authorized Individuals, whether such instructions are given in writing or by telephone, telefax or Internet and intranet websites designated by the Bank with respect to separate products or services offered by the Bank.

  4.4Direct Debit.  

  The Borrower agrees that on the due date of any amount due under this Agreement, the Bank will debit the amount due from deposit account number ______________ owned by Borrower, or such other of the Borrower’s accounts with the Bank as designated in writing by the Borrower (the "Designated Account"). Should there be insufficient funds in the Designated Account to pay all such sums when due, the full amount of such deficiency shall be immediately due and payable by the Borrower.

  4.5Banking Days.  

  

  Unless otherwise provided in this Agreement, a banking day is a day other than a Saturday, Sunday or other day on which commercial banks are authorized to close, or are in fact closed, in the state where the Bank's lending office is located, and, if such day relates to amounts bearing interest at an offshore rate (if any), means any such day on which dealings in dollar deposits are conducted among banks in the offshore dollar interbank market.  All payments and disbursements which would be due or which are received on a day which is not a banking day will be due or applied, as applicable, on the next banking day.

  4.6Interest Calculation.  

  Except as otherwise stated in this Agreement, all interest and fees, if any, will be computed on the basis of a 360-day year and the actual number of days elapsed.  This results in more interest or a higher fee than if a 365-day year is used.  Installments of principal which are not paid when due under this Agreement shall continue to bear interest until paid.  To the extent that any calculation of interest or any fee required to be paid under this Agreement shall be less than zero, such rate shall be deemed zero for purposes of this Agreement.

  4.7Default Rate.  

  Upon the occurrence of any default or after maturity or after judgment has been rendered on any obligation under this Agreement, all amounts outstanding under this Agreement, including any unpaid interest, fees, or costs, will at the option of the Bank bear interest at a rate which is [6.0] percentage point(s) higher than the rate of interest otherwise provided under this Agreement.  This may result in compounding of interest.  This will not constitute a waiver of any default.

  4.8Overdrafts.  

  At the Bank's sole option in each instance, the Bank may do one of the following:

  (a)	The Bank may make advances under this Agreement to prevent or cover an overdraft on any account of the Borrower with the Bank.  Each such advance will accrue interest from the date of the advance or the date on which the account is overdrawn, whichever occurs first, at the interest rate described in this Agreement.  The Bank may make such advances even if the advances may cause any credit limit under this Agreement to be exceeded.

  (b)	The Bank may reduce the amount of credit otherwise available under this Agreement by the amount of any overdraft on any account of the Borrower with the Bank.

  This paragraph shall not be deemed to authorize the Borrower to create overdrafts on any of the Borrower's accounts with the Bank.

  4.9Payments in Kind.  

  If the Bank requires delivery in kind of the proceeds of collection of the Borrower's accounts receivable, such proceeds shall be credited to interest, principal, and other sums owed to the Bank under this Agreement in the order and proportion determined by the Bank in its sole discretion.  All such credits will be conditioned upon collection and any returned items may, at the Bank's option, be charged to the Borrower.

  5.conditions

  Before the Bank is required to extend any credit to the Borrower under this Agreement, it must receive any documents and other items it may reasonably require, in form and content acceptable to the Bank, including any items specifically listed below.

  5.1Authorizations.  

  If the Borrower or any other Obligor is anything other than a natural person, evidence that the execution, delivery and performance by the Borrower and/or such Obligor of this Agreement and any instrument or agreement required under this Agreement have been duly authorized.

  5.2Governing Documents.  

  If required by the Bank, a copy of the Borrower's organizational documents.

  5.3KYC Information.

  

  (a)Upon the request of the Bank, the Borrower shall have provided to the Bank, and the Bank shall be reasonably satisfied with, the documentation and other information so requested in connection with applicable “know your customer” and anti-money-laundering rules and regulations, including, without limitation, the PATRIOT Act.

   

  (b)If the Borrower qualifies as a “legal entity customer” under the Beneficial Ownership Regulation, it shall have provided a Beneficial Ownership Certification to the Bank if so requested.

  5.4Guaranties.  

  Guaranty signed by Thorne Research, Inc.

  5.5Security Agreements.  

  Signed original security agreements covering the personal property collateral which the Bank requires.

  5.6Perfection and Evidence of Priority.  

  Evidence that the security interests and liens in favor of the Bank are valid, enforceable, properly perfected in a manner acceptable to the Bank and prior to all others' rights and interests, except those the Bank consents to in writing.  

  5.7Landlord Agreement.  

  For any personal property collateral located on real property which is subject to a mortgage or deed of trust or which is not owned by the Borrower (or the grantor of the security interest), an agreement from the owner of the real property and the holder of any such mortgage or deed of trust to be delivered to Bank within sixty (60) days of closing.

  5.8Payment of Fees.  

  Payment of all fees, expenses and other amounts due and owing to the Bank.  If any fee is not paid in cash, the Bank may, in its discretion, treat the fee as a principal advance under this Agreement or deduct the fee from the loan proceeds.

  5.9Repayment of Other Credit Agreement.  

  Evidence that the existing $20,000,000 revolving line of credit with Sumitomo Bank has been or will be repaid and cancelled on or before the first disbursement under this Agreement.

  5.10Good Standing.  

  Certificates of good standing for the Borrower from its state of formation and from any other state in which the Borrower is required to qualify to conduct its business.

  5.11Legal Opinion.  

  A written opinion from the Borrower's legal counsel, covering such matters as the Bank may require.  The legal counsel and the terms of the opinion must be acceptable to the Bank.

  5.12Insurance.  

  Evidence of insurance coverage, as required in the "Covenants" section of this Agreement.

  6.representations and warranties

  When the Borrower signs this Agreement, and until the Bank is repaid in full, the Borrower makes the following representations and warranties.  Each request for an extension of credit constitutes a renewal of these representations and warranties as of the date of the request:

  6.1Formation.  

  If the Borrower is anything other than a natural person, it is duly formed and existing under the laws of the state or other jurisdiction where organized.

  

  6.2Authorization.  

  This Agreement, and any instrument or agreement required under this Agreement, are within the Borrower's powers, have been duly authorized, and do not conflict with any of its organizational papers.

  6.3Beneficial Ownership Certification.

  The information included in the Beneficial Ownership Certification most recently provided to the Bank, if applicable, is true and correct in all respects.

  6.4Good Standing.  

  In each state in which the Borrower does business, it is properly licensed, in good standing, and, where required, in compliance with fictitious name (e.g. trade name or d/b/a) statutes.

  6.5Government Sanctions.  

  (a)	The Borrower represents that no Obligor, nor any affiliated entities of any Obligor, including in the case of any Obligor that is not a natural person, subsidiaries nor, to the knowledge of the Borrower, any owner, trustee, director, officer, employee, agent, affiliate or representative of the Borrower or any other Obligor is an individual or entity (“Person”) currently the subject of any sanctions administered or enforced by the United States Government, including, without limitation, the U.S. Department of Treasury’s Office of Foreign Assets Control, the United Nations Security Council, the European Union, Her Majesty’s Treasury, or other relevant sanctions authority (collectively, “Sanctions”), nor is the Borrower or any other Obligor located, organized or resident in a country or territory that is the subject of Sanctions. 

  (b)	The Borrower represents and covenants that it will not, directly or indirectly, use the proceeds of the credit provided under this Agreement, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person, to fund any activities of or business with any Person, or in any country or territory, that, at the time of such funding, is the subject of Sanctions, or in any other manner that will result in a violation by any Person (including any Person participating in the transaction, whether as underwriter, advisor, investor or otherwise) of Sanctions. 

  6.6Financial Information.  

  All financial and other information that has been or will be supplied to the Bank is sufficiently complete to give the Bank accurate knowledge of the Borrower's (and any other Obligor's) financial condition, including all material contingent liabilities.  Since the date of the most recent financial statement provided to the Bank, there has been no material adverse change in the business condition (financial or otherwise), operations, properties or prospects of the Borrower (or any other Obligor).  If the Borrower is comprised of the trustees of a trust, the above representations shall also pertain to the trustor(s) of the trust.

  6.7Lawsuits.  

  There is no lawsuit, tax claim or other dispute pending or threatened against the Borrower or any other Obligor which, if lost, would impair the Borrower's or such Obligor’s financial condition or ability to repay its obligations as contemplated by this Agreement or any other agreement contemplated hereby, except as have been disclosed in writing to the Bank prior to the date of this Agreement.

  6.8Other Obligations.  

  The Borrower and each Related Party is not in default on any obligation for borrowed money, any purchase money obligation or any other material lease, commitment, contract, instrument or obligation, except as have been disclosed in writing to the Bank prior to the date of this Agreement.

  6.9Tax Matters.  

  

  The Borrower has no knowledge of any pending assessments or adjustments of income tax for itself or for any Related Party for any year and all taxes due have been paid, except as have been disclosed in writing to the Bank prior to the date of this Agreement.

  6.10Collateral.  

  All collateral required in this Agreement is owned by the grantor of the security interest free of any title defects or any liens or interests of others, except those which have been approved by the Bank in writing.

  6.11No Event of Default.  

  There is no event which is, or with notice or lapse of time or both would be, a default under this Agreement.

  6.12Location of Pledgor.  

  The place of business of Borrower (or, if this Pledgor has more than one place of business, its chief executive office) is located as follows: 152 West 57th Street New York, NY  10019.

  6.13ERISA Plans.  

  (a)	Each Plan (other than a multiemployer plan) is in compliance in all material respects with ERISA, the Code and other federal or state law, including all applicable minimum funding standards and there have been no prohibited transactions with respect to any Plan (other than a multiemployer plan), which has resulted or could reasonably be expected to result in a material adverse effect.

  (b)	With respect to any Plan subject to Title IV of ERISA:

  (i)	No reportable event has occurred under Section 4043(c) of ERISA which requires notice.

  (ii)	No action by the Borrower or any ERISA Affiliate to terminate or withdraw from any Plan has been taken and no notice of intent to terminate a Plan has been filed under Section 4041 or 4042 of ERISA.

  (c)	The following terms have the meanings indicated for purposes of this Agreement:

  (i)	"Code" means the Internal Revenue Code of 1986, as amended.

  (ii)	"ERISA" means the Employee Retirement Income Security Act of 1974, as amended.

  (iii)	"ERISA Affiliate" means any trade or business (whether or not incorporated) under common control with the Borrower within the meaning of Section 414(b) or (c) of the Code.

  (iv)	"Plan" means a plan within the meaning of Section 3(2) of ERISA maintained or contributed to by the Borrower or any ERISA Affiliate, including any multiemployer plan within the meaning of Section 4001(a)(3) of ERISA.

  6.14No Plan Assets.  

  The Borrower represents that, as of the date hereof and throughout the term of this Agreement, no Borrower or Guarantor, if any, is (1) an employee benefit plan subject to Title I of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), (2) a plan or account subject to Section 4975 of the Internal Revenue Code of 1986 (the “Code”); (3) an entity deemed to hold “plan assets” of any such plans or accounts for purposes of ERISA or the Code; or (4) a “governmental plan” within the meaning of ERISA.

  6.15Enforceable Agreement.  

  This Agreement is a legal, valid and binding agreement of the Borrower, enforceable against the Borrower in accordance with its terms, and any instrument or agreement required under this Agreement, when executed and delivered, will be similarly legal, valid, binding and enforceable.

  6.16No Conflicts.  

  

  This Agreement does not conflict with any law, agreement, or obligation by which the Borrower or any other Obligor is bound.

  6.17Permits, Franchises.  

  Each Related Party possesses all permits, memberships, franchises, contracts and licenses required and all trademark rights, trade name rights, patent rights, copyrights, and fictitious name rights necessary to enable it to conduct the business in which it is now engaged.

  6.18Insurance.  

  The Borrower and each Related Party has obtained, and maintained in effect, the insurance coverage required in the "Covenants" section of this Agreement.

  6.19Merchantable Inventory; Compliance with FSLA.  

  All inventory is of good and merchantable quality and free from defects, and has been produced in compliance with the requirements of the U.S. Fair Labor Standards Act (29 U.S.C. §§201 et seq.).

  7.covenants

  The Borrower agrees, so long as credit is available under this Agreement and until the Bank is repaid in full, the Borrower shall, and shall cause each Related Party:

  7.1Use of Proceeds.  

  To use the proceeds of the credit extended under this Agreement only for business purposes.

  7.2Financial Information.  

  To provide the following financial information and statements in form and content acceptable to the Bank, and such additional information as requested by the Bank from time to time.  The Bank reserves the right, upon written notice to the Borrower, to require the Borrower to deliver financial information and statements to the Bank more frequently than otherwise provided below, and to use such additional information and statements to measure any applicable financial covenants in this Agreement.

  (a)	Copies of the Form 10-K Annual Report and Form 10-Q Quarterly Report for Borrower within 90 days after the date of filing with the Securities and Exchange Commission for the Form 10-K Annual Report and 45 days after the date of filing for the Form 10-Q Quarterly Report.

  (b)	Within 90 days of the end of each fiscal year, a compliance certificate of the Borrower, signed by an authorized financial officer and setting forth whether there existed as of the date of such financial statements and whether there exists as of the date of the certificate, any default under this Agreement applicable to the party submitting the information and, if any such default exists, specifying the nature thereof and the action the party is taking and proposes to take with respect thereto.

   

  (c)	Within 45 days of the end of each quarter (excluding the last period in each fiscal year), a compliance certificate of the Borrower, signed by an authorized financial officer and setting forth  whether there existed as of the date of such financial statements and whether there exists as of the date of the certificate, any default under this Agreement applicable to the party submitting the information and, if any such default exists, specifying the nature thereof and the action the party is taking and proposes to take with respect thereto. 

  (d)	The budget of the Borrower, in form and content acceptable to the Bank, within 90 days after the end of each fiscal year.

  7.3Consolidated Total Leverage to EBITDA Ratio.  

  To maintain on a consolidated basis a ratio of Funded Debt to EBITDA not exceeding 2.5:1.0.

  “Funded Debt” means all outstanding liabilities for borrowed money (including any outstanding Letters of Credit) and other interest-bearing liabilities for Borrower and its subsidiaries, on a consolidated basis, including current and long term debt, 

  

  less the non-current portion of Subordinated Liabilities; provided that for the avoidance of doubt, “Funded Debt” shall not include operating lease liabilities.

  “EBITDA" means, for any period, for the Borrower and its subsidiaries, consolidated net income, less income or plus loss from discontinued operations (including unusual and infrequent items, agreed to at the sole discretion of the Bank), plus income taxes, plus interest expense, plus depreciation, depletion, and amortization, plus other non-cash charge, less non-cash gains / income.  This ratio will be calculated at the end of each reporting period for which the Bank requires financial statements each fiscal year, using the results of the twelve-month period ending with that reporting period.

  “Subordinated Liabilities” means liabilities subordinated to the Borrower’s obligations to the Bank in a manner acceptable to the Bank in its sole discretion.

  7.4Consolidated Fixed Charge Coverage Ratio.  

  To maintain on a consolidated basis a Consolidated Fixed Charge Coverage Ratio of at least 1.25:1.0.

  "Consolidated Fixed Charge Coverage Ratio" means the ratio of (a) Consolidated Adjusted EBITDA, to (b) the sum of, for the Borrower and its subsidiaries on a consolidated basis, Federal, state, and local taxes paid for such period interest expense, lease expense, rent expense, the current portion of long term debt and the current portion of finance lease obligations, plus Restricted Payments made during such period.

  "Consolidated Adjusted EBITDA" means, for any period, for the Borrower and its subsidiaries on a consolidated basis, an amount equal to the sum (without duplication) of (a) EBITDA, less (b) the amount of unfinanced capital expenditures for such period, plus (c) rental expense for such period.

  “Restricted Payments” means any divided or other distribution (whether in cash, securities or other property) with respect to any equity interest in Borrower or any other Related Party, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such equity interests in Borrower (including, without limitation, any equity interests of an employee of Borrower) or any option, warrant or other right to acquire any such equity interests in Borrower.  

  This ratio will be calculated at the end of each reporting period for which the Bank requires financial statements, using the results of the twelve-month period ending with that reporting period.  The current portion of long-term liabilities will be measured as of the last day of the calculation period.

  7.5Bank as Principal Depository.  

  To maintain the Bank or one of its affiliates as its principal depository bank, including for the maintenance of business, cash management, operating and administrative deposit accounts.

  7.6Other Debts.  

  Not to have outstanding or incur any direct or contingent liabilities or lease obligations (other than those to the Bank or to any affiliate of the Bank), or become liable for the liabilities of others, without the Bank's written consent.  This does not prohibit:

  (a)	Acquiring goods, supplies, or merchandise on normal trade credit.

  (b)	Liabilities, lines of credit and leases in existence on the date of this Agreement disclosed in writing to the Bank.

  7.7Other Liens.  

  Not to create, assume, or allow any security interest or lien (including judicial liens) on property each Related Party now or later owns without the Bank's written consent.  This does not prohibit:

  (a)	Liens and security interests in favor of the Bank or any affiliate of the Bank.

  (b)	Liens for taxes not yet due.

  (c)	Liens outstanding on the date of this Agreement disclosed in writing to the Bank.

  

  7.8Maintenance of Assets.  

  (a)	Not to sell, assign, lease, transfer or otherwise dispose of any part of any Related Party’s business or any Related Party’s assets except inventory sold in the ordinary course of such Related Party’s business.

  (b)	Not to sell, assign, lease, transfer or otherwise dispose of any assets for less than fair market value, or enter into any agreement to do so.

  (c)	Not to enter into any sale and leaseback agreement covering any of its fixed assets.

  (d)	To maintain and preserve all rights, privileges, and franchises any Related Party now has.

  (e)	To make any repairs, renewals, or replacements to keep each Related Party’s properties in good working condition.

  (f)	To execute and deliver such documents as the Bank deems necessary to create, perfect and continue the security interests contemplated by this Agreement.

   

  7.9Investments.  

  To (i) only make any new investments in any individual or entity, or make any capital contributions or other transfers of assets to any individual or entity that are not, or do not become, a borrower or guarantor hereunder, or (ii) only enter into any consolidation, merger or other combination or become a partner in a partnership, a member of a joint venture, or member of a limited liability company, provided that such that sums collectively expended under (i) or (ii) above do not exceed $20,000,000 in the aggregate. In addition, the following investments are permissible and shall not be subject to the foregoing $20,000,000 limitation:

  (a) 	Existing investments disclosed to the Bank in writing prior to the date of this Agreement.

  (b) 	Investments in any of the following:

  	(i)	certificates of deposit;

  	(ii) 	U.S. treasury bills and other obligations of the federal government;

  (iii)	readily marketable securities (including commercial paper, but excluding restricted stock and stock subject to the provisions of Rule 144 of the Securities and Exchange Commission).

  7.10Loans. 

  Not to make any loans, advances or other extensions of credit to any individual or entity, except for:

  (a)	Existing extensions of credit disclosed to the Bank in writing prior to the date of this Agreement.

  (b)	Extensions of credit in the nature of accounts receivable or notes receivable arising from the sale or lease of goods or services in the ordinary course of business to non-affiliated entities.

  7.11Change of Management.  

  Not to make any substantial change in the present executive or management personnel of the Borrower.

  7.12Change of Ownership.  

  Not to cause, permit, or suffer any change in capital ownership such that there is a material change, as determined by the Bank in its sole discretion in the direct or indirect capital ownership of the Borrower.

  7.13Additional Negative Covenants.  

  Except for Permitted Acquisitions (as defined below), not to, without the Bank's written consent:

  (a)	Engage in any business activities substantially different from the Borrower's present business.

  

  (b)	Liquidate or dissolve any Obligor’s business.

  (c)	With respect to any Obligor which is a business entity, adopt a plan of division or divide itself into two or more business entities (pursuant to a “plan of division” under Section 18-217 of the Delaware Limited Liability Company Act or a similar arrangement under any other applicable state statute). 

  (f)	Voluntarily suspend its business.

  A “Permitted Acquisition” shall mean:

  (a)The board of directors or comparable governing body of the entity to be (or whose assets are to be) acquired has approved such transaction.

  (b)The line or lines of business of the entity to be acquired are substantially the same as or reasonably related to one or more line or lines of business conducted by the Borrower.

  (c)The Borrower shall have delivered to the Bank all documents required to be delivered pursuant to, and in accordance with, paragraphs (e) and (f) below.

  (d)No default or event of default shall have occurred either immediately prior to or immediately after giving effect to such acquisition and any indebtedness incurred in connection therewith.

  (e)The entity being acquired shall become a Related Party, or shall be merged into one of the Related Parties immediately upon consummation of said acquisition (or if assets are being acquired, the acquirer shall be, or become, as the case may be, a Borrower).

  (f)prior to any single Permitted Acquisition (or series of related Permitted Acquisitions) for which the aggregate Permitted Acquisition consideration is greater than $10,000,000.00, or any Permitted Acquisition, if the Permitted Acquisition consideration for any such Permitted Acquisition, together with the aggregate Permitted Acquisition consideration for all Permitted Acquisitions consummated during the twelve (12) month period immediately preceding such Permitted Acquisition is greater than $30,000,000, Borrower shall have furnished to the Bank, at least five (5) business days prior to such Permitted Acquisition, (i) written notice of such Permitted Acquisition and the Borrower’s historical financial statements prepared on a pro forma basis as of the most recent fiscal quarter-end and a certificate in a form acceptable to the Bank prepared on a historical pro forma basis as of the most recent fiscal quarter-end, which certificate shall demonstrate (A) that no default or event of default would exist immediately after giving effect thereto, and (B) the Borrower’s Consolidated Total Leverage to EBITDA Ratio on a pro forma basis is at least 0.25 less than the maximum ratio permitted at such time and (ii) Bank shall have received diligence information about the Permitted Acquisition, which shall be in form and substance reasonably satisfactory to the Bank.

  7.14Notices to Bank.  

  To promptly notify the Bank in writing of:

  (a)	Any event of default under this Agreement, or any event which, with notice or lapse of time or both, would constitute an event of default.

  (b)	Any change in any Obligor’s name, legal structure, principal residence, or name on any driver’s license or special identification card issued by any state (for an individual), state of registration (for a registered entity), place of business, or chief executive office if the Obligor has more than one place of business.

  7.15Insurance.  

  (a)	General Business Insurance.  To maintain insurance satisfactory to the Bank as to amount, nature and carrier covering property damage (including loss of use and occupancy) to any of the Obligor’s properties, business interruption insurance, public liability insurance including coverage for contractual liability, product liability and workers' compensation, and any other insurance which is usual for such Obligor’s business.  Each policy shall include a cancellation clause in favor of the Bank.

  (b)	Insurance Covering Collateral.  To maintain all risk property damage insurance policies (including without limitation windstorm coverage, flood coverage, and hurricane coverage as applicable) covering the tangible property 

  

  comprising the collateral.  Each insurance policy must be for the full replacement cost of the collateral and include a replacement cost endorsement. The insurance must be issued by an insurance company acceptable to the Bank and must include a lender's loss payable endorsement in favor of the Bank in a form acceptable to the Bank.

  (c)	Evidence of Insurance.  Upon the request of the Bank, to deliver to the Bank a copy of each insurance policy, or, if permitted by the Bank, a certificate of insurance listing all insurance in force.

  7.16Compliance with Laws.  

  To comply with the requirements of all laws and all orders, writs, injunctions and decrees applicable to it or to its business or property, except in such instances in which (a) such requirement of law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted; or (b) the failure to comply therewith could not reasonably be expected to cause a material adverse change in any Obligor's business condition (financial or otherwise), operations or properties, or ability to repay the credit, or, in the case of the Controlled Substances Act, result in the forfeiture of any material property of any Obligor.

  7.17Books and Records.  

  To maintain adequate books and records, including complete and accurate records regarding all Collateral.

  7.18Audits.  

  To allow the Bank and its agents to inspect the Borrower's properties and examine, audit, and make copies of books and records at any time.  If any of the Borrower's properties, books or records are in the possession of a third party, the Borrower authorizes that third party to permit the Bank or its agents to have access to perform inspections or audits and to respond to the Bank's requests for information concerning such properties, books and records.

  7.19Perfection of Liens.  

  To help the Bank perfect and protect its security interests and liens, and reimburse it for related costs it incurs to protect its security interests and liens.

  7.20Cooperation.  

  To take any action reasonably requested by the Bank to carry out the intent of this Agreement.

  7.21Patriot Act; Beneficial Ownership Regulation.

  Promptly following any request therefor, to provide information and documentation reasonably requested by the Bank for purposes of compliance with applicable “know your customer” and anti-money-laundering rules and regulations, including, without limitation, the PATRIOT Act and the Beneficial Ownership Regulation.

  8.hazardous substances

  8.1Indemnity Regarding Hazardous Substances.  

  The Borrower will indemnify and hold harmless the Bank from any loss or liability the Bank incurs in connection with or as a result of this Agreement, which directly or indirectly arises out of the use, generation, manufacture, production, storage, release, threatened release, discharge, disposal or presence of a hazardous substance.  This indemnity will apply whether the hazardous substance is on, under or about the Borrower's property or operations or property leased to the Borrower.  The indemnity includes but is not limited to attorneys' fees (including the reasonable estimate of the allocated cost of in-house counsel and staff).  The indemnity extends to the Bank, its parent, subsidiaries and all of their directors, officers, employees, agents, successors, attorneys and assigns. 

  8.2Compliance Regarding Hazardous Substances.  

  The Borrower represents and warrants that the Borrower has complied with all current and future laws, regulations and ordinances or other requirements of any governmental authority relating to or imposing liability or standards of conduct concerning protection of health or the environment or hazardous substances.

  

  8.3Notices Regarding Hazardous Substances.  

  Until full repayment of the loan, the Borrower will promptly notify the Bank in writing of any threatened or pending investigation of the Borrower or its operations by any governmental agency under any current or future law, regulation or ordinance pertaining to any hazardous substance.

  8.4Site Visits, Observations and Testing.  

  The Bank and its agents and representatives will have the right at any reasonable time, after giving reasonable notice to the Borrower, to enter and visit any locations where the collateral securing this Agreement (the “Collateral”) is located for the purposes of observing the Collateral, taking and removing environmental samples, and conducting tests.  The Borrower shall reimburse the Bank on demand for the costs of any such environmental investigation and testing.  The Bank will make reasonable efforts during any site visit, observation or testing conducted pursuant to this paragraph to avoid interfering with the Borrower’s use of the Collateral.  The Bank is under no duty to observe the Collateral or to conduct tests, and any such acts by the Bank will be solely for the purposes of protecting the Bank's security and preserving the Bank's rights under this Agreement.  No site visit, observation or testing or any report or findings made as a result thereof (“Environmental Report”) (i) will result in a waiver of any default of the Borrower; (ii) impose any liability on the Bank; or (iii) be a representation or warranty of any kind regarding the Collateral (including its condition or value or compliance with any laws) or the Environmental Report (including its accuracy or completeness).  In the event the Bank has a duty or obligation under applicable laws, regulations or other requirements to disclose an Environmental Report to the Borrower or any other party, the Borrower authorizes the Bank to make such a disclosure.  The Bank may also disclose an Environmental Report to any regulatory authority, and to any other parties as necessary or appropriate in the Bank’s judgment.  The Borrower further understands and agrees that any Environmental Report or other information regarding a site visit, observation or testing that is disclosed to the Borrower by the Bank or its agents and representatives is to be evaluated (including any reporting or other disclosure obligations of the Borrower) by the Borrower without advice or assistance from the Bank.

  8.5Definition of Hazardous Substances.  

  "Hazardous substance" means any substance, material or waste that is or becomes designated or regulated as "toxic," "hazardous," "pollutant," or "contaminant" or a similar designation or regulation under any current or future federal, state or local law (whether under common law, statute, regulation or otherwise) or judicial or administrative interpretation of such, including without limitation petroleum or natural gas.

  8.6Continuing Obligation.  

  The Borrower's obligations to the Bank under this Article, except the obligation to give notices to the Bank, shall survive termination of this Agreement and repayment of the Borrower's obligations to the Bank under this Agreement.

  9.default and remedies

  If any of the following events of default occurs, the Bank may do one or more of the following without prior notice except as required by law or expressly agreed in writing by Bank: declare the Borrower in default, stop making any additional credit available to the Borrower, and require the Borrower to repay its entire debt immediately.  If an event which, with notice or the passage of time, will constitute an event of default has occurred and is continuing, the Bank has no obligation to make advances or extend additional credit under this Agreement. In addition, if any event of default occurs, the Bank shall have all rights, powers and remedies available under any instruments and agreements required by or executed in connection with this Agreement, as well as all rights and remedies available at law or in equity.  If an event of default occurs under the paragraph entitled “Bankruptcy/Receivers,” below with respect to any Obligor, then the entire debt outstanding under this Agreement will automatically be due immediately.

  9.1Failure to Pay.  

  The Borrower fails to make a payment under this Agreement when due. 

  9.2Other Bank Agreements.  

  (a)        (i) Any default occurs under any other document executed or delivered in connection with this Agreement, including without limitation, any note, guaranty, subordination agreement, mortgage or other collateral agreement, (ii) any Obligor purports to revoke or disavow any guaranty or collateral agreement provided in connection with this Agreement; (iii) any representation or warranty made by any Obligor is false when made or deemed to be made; or (iv) any default occurs under 

  

  any other agreement the Borrower (or any Obligor) or any of the Borrower's related entities or affiliates has with the Bank or any affiliate of the Bank.

  9.3Cross-default.  

  Any default occurs under any agreement in connection with any credit any Obligor or any of the Borrower's related entities or affiliates has obtained from anyone else or which any Obligor or any of the Borrower's related entities or affiliates has guaranteed.

  9.4False Information.  

  The Borrower or any other Obligor has given the Bank false or misleading information or representations.

  9.5Bankruptcy/Receivers.  

  Any Obligor or any general partner of any Obligor files a bankruptcy petition, a bankruptcy petition is filed against any of the foregoing parties, or any Obligor, or any general partner of any Obligor makes a general assignment for the benefit of creditors; or a receiver or similar official is appointed for a substantial portion of any Obligor's business; or the business is terminated, or such Obligor is liquidated or dissolved.  

  9.6Lien Priority.  

  The Bank fails to have an enforceable first lien (except for any prior liens to which the Bank has consented in writing) on or security interest in any property given as security for this Agreement (or any guaranty).

  9.7Judgments.  

  Any judgments or arbitration awards are entered against any Obligor in an aggregate amount of Two Hundred Fifty Thousand Dollars ($250,000.00) or more.

  9.8Death.  

  If any Obligor is a natural person, such Obligor dies or becomes legally incompetent; if any Obligor is a trust, a trustor dies or becomes legally incompetent; if any Obligor is a partnership, any general partner dies or becomes legally incompetent.

  9.9Material Adverse Change.  

  A material adverse change occurs, or is reasonably likely to occur, in any Obligor's business condition (financial or otherwise), operations or properties, or ability to repay its obligations as contemplated hereunder or under any document executed in connection with this Agreement.

  9.10Government Action.  

  Any government authority takes action that the Bank believes materially adversely affects any Obligor's financial condition or ability to repay.

  9.11ERISA Plans.  

  A reportable event occurs under Section 4043(c) of ERISA, or any Plan termination (or commencement of proceedings to terminate a Plan) or the full or partial withdrawal from a Plan under Section 4041 or 4042 of ERISA occurs; provided such event or events could reasonably be expected, in the judgment of the Bank, to have a material adverse effect.

  9.12Covenants.  

  Any default in the performance of or compliance with any obligation, agreement or other provision contained in this Agreement (other than those specifically described as an event of default in this Article).

  9.13Forfeiture.

  A judicial or nonjudicial forfeiture or seizure proceeding is commenced by a government authority and remains pending with respect to any property of Borrower or any part thereof, on the grounds that the property or any part thereof had been used 

  

  to commit or facilitate the commission of a criminal offense by any person, including any tenant, pursuant to any law, including under the Controlled Substances Act or the Civil Asset Forfeiture Reform Act, regardless of whether or not the property shall become subject to forfeiture or seizure in connection therewith.

  10.enforcing this agreement; miscellaneous

  10.1GAAP.  

  Except as otherwise stated in this Agreement, all financial information provided to the Bank and all financial covenants will be made under generally accepted accounting principles, consistently applied.

  If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth herein, and either the Borrower or the Bank shall so request, the Borrower and the Bank shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP; provided that, until so amended, ( SEQ level3\r1\*roman \* MERGEFORMAT i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and ( SEQ level3\*roman \* MERGEFORMAT ii) the Borrower shall provide to the Bank financial statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP.

  10.2Governing Law. 

  Except to the extent that any law of the United States may apply, this Agreement  shall be governed and interpreted according to the laws of South Carolina (the “Governing Law State”), without regard to any choice of law, rules or principles to the contrary.  Nothing in this paragraph shall be construed to limit or otherwise affect any rights or remedies of the Bank under federal law.

  10.3Venue and Jurisdiction.

  The Borrower agrees that any action or suit against the Bank arising out of or relating to this Agreement shall be filed in federal court or state court located in the Governing Law State.  The Borrower agrees that the Bank shall not be deemed to have waived its rights to enforce this section by filing an action or suit against the Borrower or any Obligor in a venue outside of the Governing Law State.  If the Bank does commence an action or suit arising out of or relating to this Agreement, the Borrower agrees that the case may be filed in federal court or state court in the Governing Law State.  The Bank reserves the right to commence an action or suit in any other jurisdiction where any Borrower, any other Obligor, or any Collateral has any presence or is located.  The Borrower consents to personal jurisdiction and venue in such forum selected by the Bank and waives any right to contest jurisdiction and venue and the convenience of any such forum.  The provisions of this section are material inducements to the Bank’s acceptance of this Agreement.

  10.4Successors and Assigns.  

  This Agreement is binding on the Borrower's and the Bank's successors and assignees.  The Borrower agrees that it may not assign this Agreement without the Bank's prior consent.  The Bank may sell participations in or assign this loan and the related loan documents, and may exchange information about the Borrower and any other Obligor (including, without limitation, any information regarding any hazardous substances) with actual or potential participants or assignees.  If a participation is sold or the loan is assigned, the purchaser will have the right of set-off against the Borrower.

  10.5Waiver of Jury Trial.  

  EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER DOCUMENT EXECUTED IN CONNECTION HEREWITH OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (a) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (b) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER DOCUMENTS CONTEMPLATED HEREBY BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION AND (c) CERTIFIES THAT THIS WAIVER IS KNOWINGLY, WILLINGLY AND VOLUNTARILY MADE.

  

  10.6Waiver of Class Actions.  

  The terms “Claim” or “Claims” refer to any disputes, controversies, claims, counterclaims, allegations of liability, theories of damage, or defenses between Bank of America, N.A., its subsidiaries and affiliates, on the one hand, and the other parties to this Agreement, on the other hand (all of the foregoing each being referred to as a “Party” and collectively as the “Parties”). Whether in state court, federal court, or any other venue, jurisdiction, or before any tribunal, the Parties agree that all aspects of litigation and trial of any Claim will take place without resort to any form of class or representative action. Thus the Parties may only bring Claims against each other in an individual capacity and waive any right they may have to do so as a class representative or a class member in a class or representative action. THIS CLASS ACTION WAIVER PRECLUDES ANY PARTY FROM PARTICIPATING IN OR BEING REPRESENTED IN ANY CLASS OR REPRESENTATIVE ACTION REGARDING A CLAIM.

  10.7Severability; Waivers.  

  If any part of this Agreement is not enforceable, the rest of the Agreement may be enforced.  The Bank retains all rights, even if it makes a loan after default.  If the Bank waives a default, it may enforce a later default.  Any consent or waiver under this Agreement must be in writing.  

  10.8Expenses.  

  (a)	The Borrower shall pay to the Bank immediately upon demand the full amount of all payments, advances, charges, costs and expenses, including reasonable attorneys' fees, expended or incurred by the Bank in connection with (i) the negotiation and preparation of this Agreement and any related agreements, the Bank's continued administration of this Agreement and such related agreements, and the preparation of any amendments and waivers related to this Agreement or such related agreements, (ii) filing, recording and search fees, appraisal fees, field examination fees, title report fees, and documentation fees with respect to any collateral and books and records of the Borrower or any other Obligor (iii) the Bank's costs or losses arising from any changes in law which are allocated to this Agreement or any credit outstanding under this Agreement, and (iv) costs or expenses required to be paid by the Borrower or any other Obligor that are paid, incurred or advanced by the Bank.

  (b)	The Borrower will indemnify and hold the Bank harmless from any loss, liability, damages, judgments, and costs of any kind relating to or arising directly or indirectly out of (i) this Agreement or any document required hereunder, (ii) any credit extended or committed by the Bank to the Borrower hereunder, (iii) any claim, whether well-founded or otherwise, that there has been a failure to comply with any law regulating the Borrower's sales or leases to or performance of services for debtors obligated upon the Borrower's accounts receivable and disclosures in connection therewith, and (iv) any litigation or proceeding related to or arising out of this Agreement, any such document, any such credit, or any such claim, including, without limitation, any act resulting from (A) the Bank complying with instructions the Bank reasonably believes are made by any Authorized Individual and (B) the Bank’s reliance on any Communication executed using an Electronic Signature, or in the form of an Electronic Record, that the Bank reasonably believes is made by any Authorized Individual.  This paragraph will survive this Agreement's termination, and will benefit the Bank and its officers, employees, and agents.

  (c)	The Borrower shall reimburse the Bank for any reasonable costs and attorneys' fees incurred by the Bank in connection with (a) the enforcement or preservation of the Bank's rights and remedies and/or the collection of any obligations of the Borrower which become due to the Bank and in connection with any "workout" or restructuring, and (b) the prosecution or defense of any action in any way related to this Agreement, the credit provided hereunder or any related agreements, including without limitation, any action for declaratory relief, whether incurred at the trial or appellate level, in an arbitration proceeding or otherwise, and including any of the foregoing incurred in connection with any bankruptcy proceeding (including without limitation, any adversary proceeding, contested matter or motion brought by the Bank or any other person) relating to the Borrower or any other person or entity.

  10.9Set-Off.

  Upon and after the occurrence of an event of default under this Agreement, (a) the Borrower hereby authorizes the Bank at any time without notice and whether or not the Bank shall have declared any amount owing by the Borrower to be due and payable, to set off against, and to apply to the payment of, the Borrower’s indebtedness and obligations to the Bank under this Agreement and all related agreements, whether matured or unmatured, fixed or contingent, liquidated or unliquidated, any and all amounts owing by the Bank to the Borrower, and in the case of deposits, whether general or special (except trust and escrow accounts), time or demand and however evidenced, and (b) pending any such action, to hold such amounts as collateral to secure such indebtedness and obligations of the Borrower to the Bank and to return as unpaid for insufficient funds any and all checks and other items drawn against any deposits so held as the Bank, in its sole discretion, may elect.  

  

  The Borrower hereby grants to the Bank a security interest in all deposits and accounts maintained with the Bank to secure the payment of all such indebtedness and obligations of the Borrower to the Bank.  

  10.10One Agreement.  

  This Agreement and any related security or other agreements required by this Agreement constitute the entire agreement between the Borrower and the Bank with respect to each credit subject hereto and supersede all prior negotiations, communications, discussions and correspondence concerning the subject matter hereof. In the event of any conflict between this Agreement and any other agreements required by this Agreement, this Agreement will prevail.

  10.11Notices.  

  Unless otherwise provided in this Agreement or in another agreement between the Bank and the Borrower, all notices required under this Agreement shall be personally delivered or sent by first class mail, postage prepaid, or by overnight courier, to the addresses on the signature page of this Agreement, or sent by facsimile to the fax number(s) listed on the signature page, or to such other addresses as the Bank and the Borrower may specify from time to time in writing (any such notice a “Written Notice”).  Written Notices shall be effective (i) if mailed, upon the earlier of receipt or five (5) days after deposit in the U.S. mail, first class, postage prepaid, (ii) if telecopied, when transmitted, or (iii) if hand-delivered, by courier or otherwise (including telegram, lettergram or mailgram), when delivered.  In lieu of a Written Notice, notices and/or communications from the Bank to the Borrower may, to the extent permitted by law, be delivered electronically (i) by transmitting the communication to the electronic address provided by the Borrower or to such other electronic address as the Borrower may specify from time to time in writing, or (ii) by posting the communication on a website and sending the Borrower a notice to the Borrower’s postal address or electronic address telling the Borrower that the communication has been posted, its location, and providing instructions on how to view it (any such notice, an “Electronic Notice”).  Electronic Notices shall be effective when the communication, or a notice advising of its posting to a website, is sent to the Borrower’s electronic address.

  10.12Headings.  

  Article and paragraph headings are for reference only and shall not affect the interpretation or meaning of any provisions of this Agreement.

  10.13Borrower/Obligor Information; Reporting to Credit Bureaus.  

  The Borrower authorizes the Bank at any time to verify or check any information given by the Borrower to the Bank, check the Borrower’s credit references, verify employment, and obtain credit reports and other credit bureau information from time to time in connection with the administration, servicing and collection of the loans under this Agreement.  The Borrower agrees that the Bank shall have the right at all times to disclose and report to credit reporting agencies and credit rating agencies such information pertaining to the Borrower and all other Obligors as is consistent with the Bank's policies and practices from time to time in effect.

  10.14Amendments.

  This Agreement may only be amended by a writing signed by the parties hereto; which, to the extent expressly agreed to by the Bank in its discretion, may include being amended by an Electronic Record signed by the parties hereto using Electronic Signatures pursuant to the terms of this Agreement.

  10.15Electronic Records and Signatures.

  This Agreement and any document, amendment, approval, consent, information, notice, certificate, request, statement, disclosure or authorization related to this Agreement (each a “Communication”), including Communications required to be in writing, may, if agreed by the Bank, be in the form of an Electronic Record and may be executed using Electronic Signatures, including, without limitation, facsimile and/or .pdf.  The Borrower agrees that any Electronic Signature (including, without limitation, facsimile or .pdf) on or associated with any Communication shall be valid and binding on the Borrower to the same extent as a manual, original signature, and that any Communication entered into by Electronic Signature, will constitute the legal, valid and binding obligation of the Borrower enforceable against the Borrower in accordance with the terms thereof to the same extent as if a manually executed original signature was delivered to the Bank.  Any Communication may be executed in as many counterparts as necessary or convenient, including both paper and electronic counterparts, but all such counterparts are one and the same Communication.  For the avoidance of doubt, the authorization under this paragraph may include, without limitation, use or acceptance by the Bank of a manually signed paper Communication which has been converted into electronic form (such as scanned into PDF format), or an electronically signed Communication converted into another format, for transmission, delivery and/or retention.  The Bank may, at its option, create one or more 

  

  copies of any Communication in the form of an imaged Electronic Record (“Electronic Copy”), which shall be deemed created in the ordinary course of the Bank’s business, and destroy the original paper document.  All Communications in the form of an Electronic Record, including an Electronic Copy, shall be considered an original for all purposes, and shall have the same legal effect, validity and enforceability as a paper record.  Notwithstanding anything contained herein to the contrary, the Bank is under no obligation to accept an Electronic Signature in any form or in any format unless expressly agreed to by the Bank pursuant to procedures approved by it; provided, further, without limiting the foregoing, (a) to the extent the Bank has agreed to accept such Electronic Signature, the Bank shall be entitled to rely on any such Electronic Signature purportedly given by or on behalf of any Obligor without further verification and (b) upon the request of the Bank any Electronic Signature shall be promptly followed by a manually executed, original counterpart.  For purposes hereof, “Electronic Record” and “Electronic Signature” shall have the meanings assigned to them, respectively, by 15 USC §7006, as it may be amended from time to time.

  10.16Disposition of Schedules and Reports.

  The Bank will not be obligated to return any schedules, invoices, statements, budgets, forecasts, reports or other papers delivered by the Borrower.  The Bank will destroy or otherwise dispose of such materials at such time as the Bank, in its discretion, deems appropriate.

  10.17Returned Merchandise.

  Until the Bank exercises its rights to collect the accounts receivable as provided under any security agreement required under this Agreement, the Borrower may continue its present policies for returned merchandise and adjustments.  Credit adjustments with respect to returned merchandise shall be made immediately upon receipt of the merchandise by the Borrower or upon such other disposition of the merchandise by the debtor in accordance with the Borrower's instructions.  

  10.18Verification of Receivables.

  The Bank may at any time, either orally or in writing, request confirmation from any debtor of the current amount and status of the accounts receivable upon which such debtor is obligated.

  10.19Waiver of Confidentiality.

  The Borrower authorizes the Bank to discuss the Borrower's financial affairs and business operations with any accountants, auditors, business consultants, or other professional advisors employed by the Borrower, and authorizes such parties to disclose to the Bank such financial and business information or reports (including management letters) concerning the Borrower as the Bank may request.

  [Remainder of Page Intentionally Left Blank]

   

   

   

  

  Signature Page 

   

  The Borrower executed this Agreement as of the date stated at the top of the first page, intending to create an instrument executed under seal.

   

  Bank:

   

  Bank of America, N.A.

   

   

  By: /s/ Robert D. Davis, III	

  Robert D. Davis, III, Vice President

   

   

   

  Borrower:

   

  Thorne HealthTech, Inc.,

  a Delaware corporation

   

   

  By: /s/ Scott S. Wheeler	 (Seal)

  Scott S. Wheeler 

  Chief Financial Officer

   

   

   

  Prepared by:  Moore & Van Allen PLLC 

   

   

  Address where notices to

  the Bank are to be sent:

   

  Bank of America

  NC1-001-05-13

  One Independence Center

  101 North Tryon Street

  Charlotte, NC 28255-0001

   

  	 

  Address where notices to

  the Borrower are to be sent:

   

  Thorne HealthTech, Inc.

  620 Omni Industrial Blvd.

  Summerville, SC 02986

   

   

   

   

  [Loan Agreement Signature Page]

  

  USA Patriot Act Notice; Affiliate Sharing Notice; Affiliate Marketing Notice.  

  Federal law requires Bank of America, N.A. (the “Bank”) to provide the following three notices. The notices are not part of the foregoing agreement or instrument and may not be altered.  Please read the notices carefully.

  USA PATRIOT ACT NOTICE

   

  Federal law requires all financial institutions to obtain, verify and record information that identifies each person who opens an account or obtains a loan.  The Bank will ask for the Borrower’s legal name, address, tax ID number or social security number and other identifying information.  The Bank may also ask for additional information or documentation or take other actions reasonably necessary to verify the identity of the Borrower, guarantors or other related persons.

   

   

   

   

   

  

  schedule a	FEES

   

  (a)   Facility No. 1 Loan Fee.  

  The Borrower agrees to pay a loan fee for Facility No. 1 in the amount of $15,000.00.  This fee is due on the date of this Agreement.

  (b)   Late Fee.

  To the extent permitted by law, the Borrower agrees to pay a late fee in an amount not to exceed four percent (4%) of any payment that is more than fifteen (15) days late.  The imposition and payment of a late fee shall not constitute a waiver of the Bank’s rights with respect to the default.

  (c)   Returned Payment Fee.  

  The Bank, in its discretion, may collect from the Borrower a returned payment fee each time a payment is returned or if there are insufficient funds in the designated account when a payment is attempted through automatic payment.

  (d)   Letter of Credit Fees.

  Unless otherwise agreed in writing, the Borrower agrees to pay to the Bank, the customary issuance, presentation, amendment and other processing fees, and other standard costs and charges, of the Bank relating to Letters of Credit as from time to time in effect.  Such customary fees and standard costs and charges are due and payable on demand and are nonrefundable.

  (e)   Unused Commitment Fee.  

  The Borrower agrees to pay a fee on any difference between the Facility No. 1 Commitment and the amount of credit it actually uses, determined by the daily amount of credit outstanding during the specified period.  The fee will be calculated at 0.2% per year.  This fee is due on April 1, 2022, and on the same day of each following quarter until the expiration of the availability period.

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