Agreement for Assignment of Contract Proceeds, dated October4, 2017, between OrangeHook, Inc., LifeMed ID, Inc. and Dan Thompson

THIS AGREEMENT FOR ASSIGNMENT OF CONTRACT PROCEEDS ("Agreement"), dated as of October 4,  2017, ("Effective Date") from OrangeHook, Inc., a Florida corporation ("OrangeHook"), with principal offices at 319 Barry Avenue South, Suite 300, Wayzata, MN 55391 and LifeMed ID, Inc, a California corporation ("LifeMed)" and, together with OrangeHook, individually and collectively, jointly and severally, the "Companies") with principal offices at 3009 Douglas Boulevard, Suite 200, Roseville, California 95661 to Dan Thompson, an individual ("Thompson"), located at [*] MN 55446 (collectively, the "Parties").

WHEREAS, OrangeHook seeks to borrow funds in the amount of approximately one million nine hundred fifty thousand dollars ($1,950,000) to support its working capital needs, and Thompson desires to lend such amount to OrangeHook; and

WHEREAS, the Parties are entering into this Agreement to establish the Parties' respective rights and obligations, including the assignment of the Companies' right to receive [***] dollars ($[***]) from Lenovo (including, without limitation, the Companies' right to receive payments under the Minimum Pre-purchase Commitment (as defined in Amendment 3)) to Thompson in consideration of the Loan and the Equity Issuance to Thompson upon payment by Thompson of such other amounts as specified herein.

1.      LOAN. Thompson agrees to lend $1,950,000 (the "Loan") to the Companies by wire transfer to the bank account(s) on the Effective Date and in accordance with wire instructions to be provided separately by OrangeHook.

2.      ASSIGNMENT; INDEBTEDNESS.  In consideration of the Loan, the Companies hereby sell and assign to Thompson, and Thompson hereby agrees to purchase, all of the Companies' right, title and interest to receive payment of monies and all claims for monies due and to become due to the Companies under the Contract (the "Account") in the amount of $[***], including, without limitation, the Companies' right, title and interest to receive the Minimum Pre-purchase Commitments  specified in Exhibit B hereto (the "Payment Obligations").

INFORMATION MARKED BY [***] HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENITAL TREATMENT. THE OMITTED PORTION HAS BEEN SEPARATELY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION.

(c)      Repayments. If Thompson is required to repay, refund or otherwise disgorge any payment received by Thompson for the Payment Obligations or the Account, the Companies hereby indemnify, save and hold Thompson harmless with respect to such payment and the amount of the repayment by Thompson shall be part of the Payment Obligations, notwithstanding any termination of this Agreement.

(d)      Companies To Remain Liable. Notwithstanding anything to the contrary in this Agreement, the Payment Obligations shall be with full recourse to the Companies and the Companies shall remain liable under this Agreement to repay the full amount of the Payment Obligations (or any outstanding portion thereof, as the case may be) to Thompson. The Companies shall observe, perform and fulfill all of the conditions and obligations to be observed, performed and fulfilled by them under the Contract, including collection efforts or filing of legal claims to obtain payments required under the Account. Thompson shall not be required or obligated in any manner to observe, perform or fulfill any of the conditions or obligations of the Companies under the Contract, to make any inquiry as to the nature or sufficiency of any payment received by Thompson or the Companies, to present or file any claim or to take any other action to collect or enforce the payment of any amounts which may have been assigned to Thompson or to which Thompson may be entitled hereunder at any time.

(e)      Equity Issuance. Subject to the terms and conditions of this Agreement, upon payment of an additional $50,000 on or before November 1, 2017 by Thompson to OrangeHook, OrangeHook shall promptly issue to Thompson 5,000 shares of Common Stock of OrangeHook (the "Common Stock") and seven-year warrants to purchase 50,000 shares of Common Stock at an exercise price of $5.00 per share in the form attached as Exhibit D.  All share amounts and exercise prices are subject to proportional adjustment for stock splits, share combinations and similar transactions.

 

 

 

 

 

 

 

 

INFORMATION MARKED BY [***] HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENITAL TREATMENT. THE OMITTED PORTION HAS BEEN SEPARATELY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION.

 

 

 

4.      SECURITY INTEREST. As security for the payment and performance of the Payment Obligations, the Companies hereby grant to Thompson a continuing security interest in and lien upon all of the Companies' right, title and interest in and to the following, whether now owned or hereafter created, acquiring or arising (collectively, the "Collateral"):

(a)      the Account;

(b)      the Intellectual Property Collateral (as defined in this Section 4, below); and

(c)      all proceeds and products of each of the foregoing.

As used herein, the following terms have the following meanings;

"Intellectual Property Collateral" means collectively, with respect to each Company, the (i) all patents issued or assigned to, and all patent applications and registrations made by, such Company (whether issued, established or registered or recorded in the United States or any other country or any political subdivision thereof), (ii) all trademarks (including service marks), slogans, logos, symbols, certification marks, collective marks, trade dress, uniform resource locators (URL's), domain names, corporate names and trade names, whether statutory or common law, whether registered or unregistered and whether established or registered in the United States or any other country or any political subdivision thereof (excluding only United States intent-to-use trademark applications to the extent that and solely during the period in which the grant of a security interest therein would impair, under applicable federal law, the registrability of such applications or the validity or enforceability of registrations issuing from such applications), (iii) copyrights (whether statutory or common law, whether established or registered in the United States or any other country or any political subdivision thereof, whether registered or unregistered and whether published or unpublished), (iv) trade secrets, (v) intellectual property licenses (other than any intellectual property license pursuant to which the grant of a security interest therein would violate or invalidate such license after giving effect to the applicable anti-assignment provisions of the UCC and other applicable law and other than proceeds and receivables thereof) and (vi) all other industrial, intangible and intellectual property of any type, including mask works and industrial designs, including, without limitation, the intellectual property listed on Exhibit C hereto and in each case, all tangible embodiments of the foregoing and all registrations and applications made by such Company, in each case, whether now owned or hereafter created or acquired by or assigned to such Company, together with any and all (A) rights and privileges arising under applicable law and international treaties and conventions with respect to such Company's use of such copyrights, (B) reissues, renewals, continuations and extensions thereof and amendments thereto, (C) income, fees, royalties, damages, claims and payments now or hereafter due and/or payable with respect thereto, including damages and payments for past, present or future infringements thereof, (D) rights corresponding thereto throughout the world and (E) rights to sue for past, present or future infringements thereof.

5.      FILINGS AND FURTHER ASSURANCES. The Companies shall at any time and from time to time duly execute and deliver any and all such other and further assurances and documents and take such actions as in the reasonable judgment of Thompson may be necessary to obtain or maintain the full benefits of this Agreement. Without limiting to the foregoing, the Companies shall take all reasonable actions requested by Thompson from time to time to cause the attachment and perfection of, and Thompson's ability to enforce, Thompson's security interest in any and all of the Collateral and to ensure that Thompson's security interest ranks at least pari passu in priority with the Companies' other Senior Secured Indebtedness.  The Companies irrevocably and unconditionally authorize Thompson (or Thompson's agent) to complete and file, and the Companies ratify such filing, at any time and from time to time, such financing statements with respect to the Collateral naming Thompson as the secured party and one or both of the Companies as debtor, as Thompson may require, together with all amendments and continuations with respect thereto. As used in this Agreement, "Senior Secured Indebtedness" means the secured indebtedness of the Companies in favor of Regal Consultancy, Signature Bank and participants under OrangeHook's Participation and Repayment Priority Agreement.