NEITHER THIS NOTE NOR THE SECURITIES INTO WHICH THIS NOTE IS EXCHANGEABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE. THESE SECURITIES HAVE BEEN SOLD IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.
Lionheart II Holdings, LLC
Exchangeable Promissory Note
Original Principal Amount: $5,000,000 |
Issuance Date: [_________]
Number: LIFW-[1][2][3]
FOR VALUE RECEIVED, Lionheart II Holdings, LLC, an entity organized under the laws of the State of Delaware (the "Company"), hereby promises to pay to the order of YA II PN, LTD., or its registered assigns (the “Holder”), the amount set out above as the Original Principal Amount (as reduced pursuant to the terms hereof pursuant to repayment, redemption, conversion or otherwise, the “Principal”) and Payment Premium or Redemption Premium, as applicable, in each case when due, and to pay interest (“Interest”) on any outstanding Principal at the applicable Interest Rate (as defined below) from the date set out above as the Issuance Date (the “Issuance Date”) until the same becomes due and payable, whether upon the Maturity Date or acceleration, exchange, redemption or otherwise (in each case in accordance with the terms hereof). Certain capitalized terms used herein are defined in Section (12). The Issuance Date is the date of the first issuance of this Exchangeable Promissory Note (the “Note”) regardless of the number of transfers and regardless of the number of instruments, which may be issued to evidence such Note. This Note was issued with a 5% original issue discount.
This Note is being issued pursuant to Section 2.01 of the Standby Equity Purchase Agreement, dated November ___, 2023 (as may be amended, amended and restated, extended, supplemented or otherwise modified in writing from time to time, the “SEPA”), between MSP Recovery, Inc. (“Parent”) and the YA II PN, Ltd., as the Investor. This Note may be repaid in accordance with the terms of the SEPA, including, without limitation, pursuant to Investor Notices and corresponding Advance Notices (as defined in the SEPA) deemed given by the Parent in connection with such Investor Notices (as defined in the SEPA). The Holder also has the option of exchanging on one or more occasions all or part of the then outstanding balance under this Note by delivering to the Company one or more Exchange Notices in accordance with Section 3 of this Note.
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If to the Company, to: | MSP Recovery, Inc. |
| 2701 S. Le Jeune Rd, Floor 10
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| Attn: John Ruiz, CEO Alexandra Plasencia, General Counsel |
| E-mail: jruiz@msprecovery.com, aplasencia@msprecovery.com |
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with a copy (which shall not constitute notice) to:
| Steven Canner Baker & McKenzie LLP 452 Fifth Avenue New York, NY 10018 Telephone: (212) 626-4884
Jeremy L. Moore Baker & McKenzie LLP 700 Louisiana Street Houston, TX 77002 Telephone: (713) 427-5000 |
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If to the Holder: | YA II PN, Ltd |
| c/o Yorkville Advisors Global, LLC 1012 Springfield Avenue |
| Mountainside, NJ 07092 |
| Attention: Mark Angelo |
| Telephone: 201-985-8300 |
| Email: Legal@yorkvilleadvisors.com |
or at such other address and/or email and/or to the attention of such other person as the recipient party has specified by written notice given to each other party three (3) Business Days prior to the effectiveness of such change. Written confirmation of receipt (i) given by the recipient of such notice, consent, waiver or other communication, (ii) electronically generated by the sender's email service provider containing the time, date, recipient email address or (iii) provided by a nationally recognized overnight delivery service, shall be rebuttable evidence of personal service, receipt by facsimile or receipt from a nationally recognized overnight delivery service in accordance with clause (i), (ii) or (iii) above, respectively.
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[Signature Page Follows]
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IN WITNESS WHEREOF, the Company and the Parent have caused this Exchangeable Promissory Note to be duly executed by a duly authorized officer as of the date set forth above.
| COMPANY: |
| LIONHEART II HOLDINGS, LLC |
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| By: |
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| PARENT: |
| MSP RECOVERY, INC. |
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| By: |
| Name: John Ruiz |
| Title: CEO |
EXHIBIT I
EXCHANGE NOTICE
(To be executed by the Holder in order to Exchange the Note)
TO: LIONHEART II HOLDINGS, LLC
Via Email:
The undersigned hereby irrevocably elects to exchange a portion of the outstanding and unpaid Exchange Amount of Note No. LIFW-[1] into Common Shares of MSP RECOVERY, INC., according to the conditions stated therein, as of the Exchange Date written below.
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Please issue the Common Shares in the following name and deliver them to the following account: | ||
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