Clearday, Inc. entered into a factoring facility and to obtain additional financings in the aggregate amount of approximately $95,000 prior to the payment of fees and expenses, including placement fees. The net proceeds from these financings of approximately $92,150 will be used to fund innovative services at Clearday, including robotic services and expansion of additional services to be provided in Clearday's residential care communities. A subsidiary of Clearday: MCA Westover Hills Operating Company, entered into a Purchase and Sale Agreement with an institutional financing party (“Buyer”) to sell $141,550 of future receivables, which include the future resident revenues in the residential care facility.

MCA Westover paid origination and other fees, which resulted in a net aggregate amount of approximately $2,850. The Purchase Agreement provides Buyer specified customary collection procedures for the collection and remittance of the weekly payable amount including direct payments from a specified authorized bank account of approximately $1,559.00 per day, which should result in a term for this facility of 90 days. The Purchase Agreement expressly provides that the sale of the future receipts shall be construed and treated for all purposes as a true and complete sale of receivables at a discount, and not a loan; that the title to the sold future sales is transferred to Buyer under such agreement free and clear of all liens; and includes customary remedies that may be exercised by Buyer upon a breach or default, including payment of attorney fees and costs of collection.

Under the Purchase Agreement, MCA Westover granted a right of first refusal for other factoring agreements for a two year period. The Purchase Agreement also provides customary provisions regarding, among other matters, representations, warranties and covenants, further assurances, indemnification, arbitration, governing law and venue as well as a customary anti-stacking provision. The Purchase Agreement also provides for the grant by MCA Westover of a security interest in the future receivables and other related collateral under the Uniform Commercial Code in accounts and proceeds in the event that the future receipts are “accounts” or “payment intangibles” under the Uniform Commercial Code.

An officer of Clearday agreed to a Personal Performance Guarantee providing to Buyer her irrevocable, absolute, and unconditional personal guaranty of all of the obligations under the Purchase Agreement to Buyer. Such guaranty provides customary provisions, including representations, warranties and covenants. Affiliates of MCA Westover also executed this Purchase Agreement to guaranty the obligations of MCA Westover under this facility.