Material Agreement - Form 8-K

Item 1.01. Entry into a Material Definitive Agreement.

On March 10, 2024, Applied UV, Inc. (the "Company"), SteriLumen, Inc. and MunnWorks, LLC (together with SteriLumen, Inc., the "Subsidiaries") entered into a Business Loan and Security Agreement (the "Loan Agreement") with Cedar Advance LLC (the "Lender") pursuant to which the Company borrowed $772,500 (the "Loan Amount") from the Lender, for general corporate purposes, including working capital in order to facilitate further growth, at an annual interest rate of 28%, which includes broker's fees and origination charges, for a term of a total of 40 weeks.

In the Event of Default, and if not cured within three (3) business days, the Company will grant to the Lender a continuing interest, subject to the first priority security interest granted to Pinnacle Bank, in and to any and all amounts owing to the Company now or in the future and all other tangible and intangible personal property. In the uncured Event of Default, the Lender may, among other things, debit amounts due from the Company's checking account and accelerate the total principal amount, including any accrued interest, immediately. In the event of acceleration, interest thereafter will accrue on the total amount due at 24% per annum. The First Loan may be prepaid at any time without penalty.

The Loan Agreement contains customary representations and warranties and customary affirmative and negative covenants applicable to the Company and the Subsidiaries, including, without limitation, restrictions on liens and transfer or disposal of assets. The Company intends to use the net proceeds from the Loan Agreement for general corporate purposes, including working capital in order to facilitate further growth.

The Company and the Subsidiaries previously entered into a Business Loan and Security Agreement with the Lender dated February 8, 2024 in which the Company borrowed $515,000 from the Lender on terms similar to the terms contained in the Loan Agreement.

Capitalized terms used but not otherwise defined herein shall have the respective meanings ascribed thereto by the Loan Agreements. The foregoing descriptions of the Loan Agreement and the Business Loan and Security Agreement dated February 8, 2024 are not intended to be complete and are qualified in their entirety by reference to their full text, copies of which are filed as Exhibit 10.1 hereto and Exhibit 10.2 hereto, respectively, and each is incorporated by reference herein.