NON-REDEMPTION AND BACKSTOP AGREEMENT
Dated as of April 14, 2025
by and between
VELTHRYN STRATEGIC INVESTMENTS, LP
and
PINNACLE GROWTH ACQUISITION CORP.
NON-REDEMPTION AND BACKSTOP AGREEMENT
This NON-REDEMPTION AND BACKSTOP AGREEMENT (this "Agreement") is entered into as of April 14, 2025, by and between VELTHRYN STRATEGIC INVESTMENTS, LP, a Delaware limited partnership (the "Investor" or the "Backstop Investor"), with its principal offices located at 2049 Century Park East, Suite 3500, Los Angeles, California 90067, and PINNACLE GROWTH ACQUISITION CORP., a Cayman Islands exempted company ("PGAC" or the "Company"), with offices located at 590 Madison Avenue, 28th Floor, New York, New York 10022, and its registered office at c/o Harborstone Corporate Services Ltd., 4th Floor, Windward House, George Town, Grand Cayman KY1-1104, Cayman Islands. The Investor and PGAC are sometimes referred to herein individually as a "Party" and collectively as the "Parties."
RECITALS
WHEREAS, PGAC is a blank-check company formed as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization, or similar business combination with one or more businesses or entities (a "Business Combination");
WHEREAS, PGAC completed its initial public offering (the "IPO") on October 17, 2023, pursuant to which PGAC raised gross proceeds of Three Hundred Million Dollars ($300,000,000) through the sale of 30,000,000 Class A ordinary shares at a price of $10.00 per share, which Class A ordinary shares, units, and warrants are listed and traded on the Nasdaq Capital Market under the ticker symbols "PGAC," "PGACU," and "PGACW," respectively;
WHEREAS, in connection with the IPO, an amount equal to $300,000,000 was deposited in a trust account (the "Trust Account") held at Glenridge National Bank, N.A. (the "Trust Custodian"), which Trust Account, as of March 31, 2025, holds approximately $312,600,000, inclusive of accrued interest earned on the amounts held therein;
WHEREAS, PGAC's sponsor is Ridgeway Capital Holdings LLC, a Delaware limited liability company (the "Sponsor"), whose managing member is Jonathan Mercer;
WHEREAS, PGAC has entered into that certain Business Combination Agreement, dated as of April 14, 2025 (the "BCA"), by and among PGAC, Pinnacle Merger Sub Inc., a Delaware corporation and direct, wholly owned subsidiary of PGAC ("Merger Sub"), and Skybridge Fintech Ltd., a Delaware corporation ("Skybridge" or the "Target"), pursuant to which, among other things, (i) PGAC will effect a re-domiciliation from the Cayman Islands to the State of Delaware under Section 388 of the Delaware General Corporation Law (the "DGCL") and the applicable provisions of the Cayman Islands Companies Act (the "Domestication"), and (ii) following the Domestication, Merger Sub will merge with and into Skybridge (the "Merger"), with Skybridge surviving as a wholly owned subsidiary of the domesticated PGAC, which will be renamed "Skybridge Fintech Holdings, Inc." (the "Combined Company");
WHEREAS, the BCA contemplates an implied enterprise value of Four Hundred Fifty Million Dollars ($450,000,000) for Skybridge, and includes as a condition to Closing (as defined below) a requirement that the Combined Company have at least Two Hundred Million Dollars ($200,000,000) of "Available Cash" at the Closing (the "Minimum Cash Condition");
WHEREAS, concurrently with the execution and delivery of the BCA, PGAC has entered into subscription agreements with certain investors (the "PIPE Investors"), including Hargrove Institutional Partners, LP (committing $60,000,000), Stonewall Global Equity Fund (committing $40,000,000), Meridian Crossover Fund III, LP (committing $25,000,000), and Canfield Asset Management, LLC (committing $25,000,000), for the purchase of an aggregate of 15,000,000 shares of common stock of the Combined Company at a price of $10.00 per share, for aggregate gross proceeds of One Hundred Fifty Million Dollars ($150,000,000) (the "PIPE Investment");
WHEREAS, in connection with the consummation of the Business Combination, holders of PGAC's Class A ordinary shares (the "PGAC Shareholders") will have the right to redeem their Class A ordinary shares for a pro rata portion of the funds held in the Trust Account (the "Redemption"), and the Parties recognize that high levels of Redemption could jeopardize the satisfaction of the Minimum Cash Condition and the maintenance of a sufficient public float for the Combined Company's shares following the Business Combination;
WHEREAS, the Parties desire that the Investor provide a backstop commitment to purchase Class A ordinary shares from shareholders who properly exercise their redemption rights ("Redeeming Shareholders") in order to help ensure that the Minimum Cash Condition and a sufficient public float are maintained in connection with the Business Combination; and
WHEREAS, as consideration for providing such backstop commitment, PGAC has agreed to issue additional shares to the Investor, on the terms and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
ARTICLE I — DEFINITIONS
Section 1.1 — Defined Terms
As used in this Agreement, the following terms shall have the meanings set forth below:
"Available Cash" has the meaning ascribed to such term in the BCA; for purposes of this Agreement, Available Cash includes the funds remaining in the Trust Account after payment of Redemptions (i.e., gross trust proceeds net of Redemptions), plus the aggregate gross proceeds of the PIPE Investment, plus the aggregate purchase price paid by the Investor for any Backstop Shares purchased hereunder, minus the aggregate amount of Transaction Expenses (as defined in the BCA), including, without limitation, the deferred underwriting commission payable to Pemberton Zanthor & Co.
"Backstop Shares" means the Class A ordinary shares (or, following the Domestication, shares of common stock) of PGAC that the Investor actually purchases from Redeeming Shareholders pursuant to this Agreement, up to the Backstop Share Cap.
"Backstop Share Cap" means 5,000,000 shares.
"BCA" means that certain Business Combination Agreement, dated as of April 14, 2025, by and among PGAC, Merger Sub, and Skybridge, as it may be amended, supplemented, restated, or otherwise modified from time to time in accordance with its terms.
"Business Combination" means the transactions contemplated by the BCA, including the Domestication and the Merger, and all other transactions and filings ancillary thereto.
"Closing" means the closing of the Business Combination, as defined in and to occur in accordance with the BCA; the Closing is projected to occur on or about July 21, 2025, or such other date as may be established pursuant to the terms of the BCA.
"Closing Date" means the date on which the Closing actually occurs.
"Combined Company" means Skybridge Fintech Holdings, Inc., the entity resulting from the Domestication and the Merger, being the domesticated successor to PGAC following its re-domiciliation from the Cayman Islands to the State of Delaware.
"Continental Registrars" means Continental Registrars, Inc., in its capacity as transfer agent for PGAC's securities (the "Transfer Agent").
"Domestication" means the re-domiciliation of PGAC from the Cayman Islands to the State of Delaware pursuant to Section 388 of the DGCL and the applicable provisions of the Cayman Islands Companies Act (As Revised).
"EGM" means the extraordinary general meeting of PGAC Shareholders at which the Business Combination and the related proposals set forth in the Proxy Statement/Prospectus will be submitted for approval by the PGAC Shareholders; the EGM is projected to be held on or about July 18, 2025, or such other date as may be established by PGAC.
"Incentive Shares" means newly issued shares of common stock of the Combined Company to be issued to the Investor on the Closing Date in an amount equal to ten percent (10%) of the number of Backstop Shares actually purchased by the Investor, as more fully described in Article III.
"Investor" means Velthryn Strategic Investments, LP, a Delaware limited partnership, and its successors and permitted assigns.
"Maximum Backstop Amount" means Fifty-One Million Two Hundred Fifty Thousand Dollars ($51,250,000), which equals 5,000,000 shares multiplied by the Per Share Backstop Price of $10.25 per share.
"Merger" means the merger of Merger Sub with and into Skybridge, with Skybridge surviving as a wholly owned subsidiary of the domesticated PGAC, as contemplated by the BCA.
"Merger Sub" means Pinnacle Merger Sub Inc., a Delaware corporation and direct, wholly owned subsidiary of PGAC.
"Minimum Cash Condition" means the condition set forth in the BCA requiring that the Combined Company have at least Two Hundred Million Dollars ($200,000,000) of Available Cash at the Closing.
"Outside Date" means October 14, 2025; provided that the Outside Date may be extended to January 14, 2026 under the circumstances and in accordance with the procedures set forth in the BCA.
"Per Share Backstop Price" means $10.25 per share.
"PGAC Shareholders" means the holders of PGAC's Class A ordinary shares.
"PIPE Investment" means the investment described in the Recitals hereof, pursuant to which the PIPE Investors have committed to purchase an aggregate of 15,000,000 shares of common stock of the Combined Company at $10.00 per share for aggregate gross proceeds of $150,000,000.
"PIPE Investors" means the investors party to subscription agreements with PGAC in connection with the PIPE Investment, as identified in the Recitals hereof.
"Proxy Statement/Prospectus" means the proxy statement/prospectus included as part of the Registration Statement on Form S-4 filed with the SEC in connection with the Business Combination (SEC File No. 333-294817).
"Redeeming Shareholders" means PGAC Shareholders who properly and validly exercise their redemption rights with respect to their Class A ordinary shares in connection with the EGM.
"Redemption" means the exercise by PGAC Shareholders of their right to redeem Class A ordinary shares for a pro rata portion of the funds held in the Trust Account, in accordance with the terms of PGAC's Amended and Restated Memorandum and Articles of Association and applicable law.
"Redemption Notice" has the meaning set forth in Section 2.2.
"Registration Statement" means the Registration Statement on Form S-4 initially filed by PGAC with the SEC on April 28, 2025, bearing File No. 333-294817 (CIK No. 0001948372), as it may be amended or supplemented from time to time.
"SEC" means the U.S. Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
"Sponsor" means Ridgeway Capital Holdings LLC, a Delaware limited liability company, whose managing member is Jonathan Mercer.
"Sponsor Support Agreement" means that certain Sponsor Support Agreement, dated as of April 14, 2025, by and among the Sponsor, PGAC, and Skybridge, as it may be amended from time to time.
"Trust Account" means the trust account established in connection with the IPO and maintained at Glenridge National Bank, N.A., 60 Wall Street, New York, New York 10005, into which the proceeds of the IPO (together with interest earned thereon) have been deposited and are held in accordance with the terms of the Investment Management Trust Agreement, dated as of October 17, 2023, between PGAC and the Trust Custodian.
"Trust Custodian" means Glenridge National Bank, N.A., in its capacity as trustee of the Trust Account, with offices at 60 Wall Street, New York, New York 10005.
Section 1.2 — Other Definitional Provisions
(a) Terms defined in the BCA and used but not otherwise defined herein shall have the respective meanings given to such terms in the BCA.
(b) Unless the context otherwise requires, (i) the word "including" (and with correlative meaning, "include" and "includes") means "including, without limitation," (ii) words in the singular include the plural and vice versa, (iii) the terms "hereof," "herein," "hereunder," and words of similar import refer to this Agreement as a whole and not to any particular provision of this Agreement, (iv) references to "Articles," "Sections," "Exhibits," and "Schedules" refer to Articles, Sections, Exhibits, and Schedules of or to this Agreement, and (v) references to any statute or regulation are to that statute or regulation as amended, modified, supplemented, or replaced from time to time (and, in the case of statutes, include any rules and regulations promulgated under such statutes).
(c) The headings and captions in this Agreement are inserted for convenience of reference only and shall not be considered a part of or affect the construction or interpretation of any provision of this Agreement.
(d) The language used in this Agreement shall be deemed to be the language chosen by the Parties to express their mutual intent, and no rule of strict construction shall be applied against either Party.
ARTICLE II — BACKSTOP COMMITMENT
Section 2.1 — Backstop Obligation
(a) Subject to the terms and conditions set forth in this Agreement, the Investor hereby irrevocably commits to purchase from Redeeming Shareholders up to 5,000,000 Class A ordinary shares of PGAC (or, following the Domestication, shares of common stock of the Combined Company) at the Per Share Backstop Price of $10.25 per share (the "Backstop Shares"), in connection with the Redemption occurring in connection with the EGM.
(b) The maximum aggregate purchase price payable by the Investor for the Backstop Shares shall not exceed the Maximum Backstop Amount of Fifty-One Million Two Hundred Fifty Thousand Dollars ($51,250,000). For the avoidance of doubt, the Investor shall not be obligated to purchase any shares in excess of the Backstop Share Cap of 5,000,000 shares, regardless of the total number of shares tendered for Redemption.
(c) The obligation of the Investor under this Section 2.1 is triggered only upon the occurrence of Redemptions in connection with the EGM. If no shares are tendered for Redemption, the Investor shall have no obligation to purchase any shares hereunder, and no Incentive Shares (as defined in Article III) shall be issued.
(d) The Per Share Backstop Price of $10.25 per share represents a premium of approximately $0.25 per share over the IPO price of $10.00 per share. The Parties acknowledge that the Per Share Backstop Price is below the current per-share redemption price of the Trust Account (which, based on the approximate Trust Account balance of $312,600,000 and 30,000,000 outstanding Class A ordinary shares, is approximately $10.42 per share as of March 31, 2025) and that this differential represents part of the consideration to the Investor for providing the backstop commitment hereunder.
Section 2.2 — Mechanics of Backstop Purchase
(a) Redemption Notice. Within two (2) business days following the determination of the final redemption results (which is expected to be determined at or around the date of the EGM, currently projected for July 18, 2025), PGAC shall deliver to the Investor a written notice (the "Redemption Notice"), substantially in the form attached hereto as Exhibit A, specifying the following:
(i) the total number of Class A ordinary shares properly tendered for Redemption by Redeeming Shareholders;
(ii) the aggregate dollar amount of Redemptions (calculated based on the per-share redemption price of the Trust Account as of the applicable record date);
(iii) the number of Backstop Shares that the Investor is required to purchase hereunder, which shall be equal to the lesser of (A) the total number of shares tendered for Redemption and (B) the Backstop Share Cap of 5,000,000 shares;
(iv) the aggregate purchase price for the Backstop Shares (calculated as the number of Backstop Shares multiplied by the Per Share Backstop Price of $10.25 per share);
(v) the number of Incentive Shares to be issued to the Investor (calculated as 10% of the number of Backstop Shares to be purchased); and
(vi) wire transfer instructions for the account designated by the Trust Custodian, Glenridge National Bank, N.A., 60 Wall Street, New York, New York 10005, into which the aggregate purchase price for the Backstop Shares is to be deposited.
(b) Funding. No later than one (1) business day prior to the anticipated Closing Date, the Investor shall fund the aggregate purchase price for the Backstop Shares by wire transfer of immediately available funds denominated in United States dollars to the account designated by the Trust Custodian as set forth in the Redemption Notice. Time shall be of the essence with respect to the Investor's funding obligation under this Section 2.2(b).
(c) Share Registration. PGAC shall cause the Transfer Agent, Continental Registrars, Inc., to register the Backstop Shares in the name of the Investor (or its designees, to the extent designated in accordance with Section 2.4) on or prior to the Closing Date. The Backstop Shares shall be delivered to the Investor in book-entry form through the facilities of The Depository Trust Company, unless the Parties otherwise agree in writing.
(d) Purchase Mechanics. The purchase of Backstop Shares shall be structured such that the Investor effectively steps into the shoes of the Redeeming Shareholders by purchasing their Class A ordinary shares at the Per Share Backstop Price of $10.25 per share. The Redeeming Shareholders shall receive their per-share redemption price from the Trust Account in accordance with PGAC's organizational documents and the terms of the Trust Agreement. The Investor's funding of the Per Share Backstop Price shall be deposited with the Trust Custodian and, to the extent necessary, applied to replenish the Trust Account for the shares so purchased. PGAC shall be responsible for coordinating with the Trust Custodian and the Transfer Agent to effectuate the settlement mechanics in a manner consistent with applicable law, PGAC's organizational documents, and the Trust Agreement. The Parties shall cooperate in good faith to establish the precise settlement mechanics, and PGAC shall deliver a detailed settlement instruction letter to the Investor no later than five (5) business days prior to the anticipated Closing Date.
Section 2.3 — Partial Redemption Scenarios
(a) If the total number of Class A ordinary shares properly tendered for Redemption is less than the Backstop Share Cap of 5,000,000 shares, the Investor shall be obligated to purchase only the number of shares actually tendered for Redemption (and the Investor's obligation with respect to the remaining portion of the backstop commitment shall terminate automatically without any further action or notice by either Party). In such event, the Incentive Shares shall be calculated based on the number of shares actually purchased by the Investor, as set forth in Section 3.1.
(b) If zero shares are tendered for Redemption, the Investor shall have no obligation to purchase any shares hereunder, no Backstop Shares shall be issued or transferred to the Investor, and no Incentive Shares shall be issued.
(c) The following illustrative scenarios are provided for informational purposes only and do not constitute representations, warranties, or guarantees regarding the actual redemption levels:
Scenario A — No Redemption (Backstop Not Triggered): If no PGAC Shareholders exercise their redemption rights, the backstop commitment is not triggered. In such event, all 30,000,000 Class A ordinary shares remain outstanding, and Available Cash would be approximately calculated as follows: Trust Account balance of approximately $312,600,000, plus PIPE Investment proceeds of $150,000,000, minus estimated Transaction Expenses of approximately $42,000,000, yielding approximately $420,600,000 of Available Cash. The Minimum Cash Condition of $200,000,000 would be easily satisfied, and no Backstop Shares or Incentive Shares would be issued to the Investor.
Scenario B — Maximum Redemption with Full Backstop: If 25,000,000 of 30,000,000 Class A ordinary shares are tendered for Redemption (representing approximately 83.3% of the outstanding public shares), the Investor would be required to purchase the full 5,000,000 Backstop Shares. Following such purchase, the remaining effective public float would consist of 5,000,000 non-redeeming public shares plus 5,000,000 Backstop Shares held by the Investor, for a total of 10,000,000 shares held by non-Sponsor, non-Target shareholders (plus the 15,000,000 shares held by PIPE Investors). Available Cash would be approximately calculated as follows: Trust Account balance of approximately $312,600,000, minus approximately $256,250,000 of Redemption payments (25,000,000 shares at an estimated per-share redemption price of approximately $10.25), plus $51,250,000 of backstop proceeds (5,000,000 shares at $10.25 per share), plus $150,000,000 of PIPE Investment proceeds, minus estimated Transaction Expenses of approximately $42,000,000, yielding approximately $215,600,000 of Available Cash. The Minimum Cash Condition of $200,000,000 would be satisfied.
Section 2.4 — Designation Rights
(a) The Investor may, in its sole discretion, designate one or more of its affiliates (each, a "Designee") to purchase some or all of the Backstop Shares on behalf of the Investor; provided that:
(i) the Investor shall provide written notice to PGAC identifying each Designee no later than five (5) business days prior to the anticipated Closing Date, specifying the number of Backstop Shares to be purchased by each such Designee;
(ii) each Designee shall execute and deliver to PGAC, concurrently with such notice, a joinder agreement substantially in the form attached hereto as Exhibit B, pursuant to which such Designee agrees to be bound by all of the terms and conditions of this Agreement that are applicable to the Investor with respect to the designated portion of the Backstop Shares; and
(iii) notwithstanding any such designation, the Investor shall remain fully and unconditionally responsible for the performance of all obligations under this Agreement, and the Investor and each Designee shall be jointly and severally liable for the purchase of the Backstop Shares designated to such Designee.
(b) No designation under this Section 2.4 shall relieve the Investor of any of its obligations or liabilities under this Agreement or any other Transaction Document to which it is a party.
ARTICLE III — INCENTIVE SHARES
Section 3.1 — Issuance of Incentive Shares
(a) As consideration for the Investor's backstop commitment and the services rendered by the Investor in agreeing to purchase Backstop Shares from Redeeming Shareholders, the Combined Company shall issue to the Investor (or its Designees, as applicable), on the Closing Date, a number of newly issued shares of common stock of the Combined Company (the "Incentive Shares") equal to ten percent (10%) of the number of Backstop Shares actually purchased by the Investor (or its Designees) pursuant to this Agreement.
(b) By way of illustration:
(i) If the Investor purchases the full 5,000,000 Backstop Shares, the Investor shall receive 500,000 Incentive Shares (5,000,000 × 10% = 500,000).
(ii) If the Investor purchases 3,000,000 Backstop Shares (because only 3,000,000 shares were tendered for Redemption), the Investor shall receive 300,000 Incentive Shares (3,000,000 × 10% = 300,000).
(iii) If the Investor purchases 1,000,000 Backstop Shares, the Investor shall receive 100,000 Incentive Shares (1,000,000 × 10% = 100,000).
(iv) If zero shares are tendered for Redemption, no Incentive Shares shall be issued.
(c) The Incentive Shares shall be fully paid and non-assessable upon issuance and shall not be subject to any preemptive rights, rights of first refusal, or similar rights.
(d) PGAC shall take all corporate actions necessary to authorize and reserve for issuance a sufficient number of shares of common stock of the Combined Company to satisfy its obligation to issue the Incentive Shares, including obtaining any necessary approvals from the PGAC board of directors or the board of directors of the Combined Company.
Section 3.2 — Registration of Incentive Shares
(a) The Combined Company shall use commercially reasonable efforts to file with the SEC, no later than thirty (30) calendar days following the Closing Date, a registration statement on Form S-1 (or Form S-3, if available at such time) registering the resale of the Incentive Shares by the Investor (or its Designees). The Combined Company shall use commercially reasonable efforts to cause such registration statement to be declared effective by the SEC as promptly as practicable following the filing thereof and to maintain the effectiveness of such registration statement for a period of not less than one (1) year following the date on which it is declared effective (or such shorter period as may be required until all Incentive Shares have been sold or are otherwise eligible for resale without restriction under Rule 144 of the Securities Act).
(b) Alternatively, the Incentive Shares may be included in the Registration Rights Agreement to be executed at or prior to the Closing among the Combined Company, the Sponsor, certain former Skybridge shareholders, and the PIPE Investors (the "Registration Rights Agreement"), in which case the registration obligations set forth in such Registration Rights Agreement shall supersede and replace the obligations set forth in Section 3.2(a) with respect to the Incentive Shares, provided that such Registration Rights Agreement provides the Investor with registration rights that are no less favorable than those set forth in this Section 3.2.
(c) The Combined Company shall bear all expenses incurred in connection with the registration of the Incentive Shares pursuant to this Section 3.2, including all registration fees, printing expenses, and fees and disbursements of counsel to the Combined Company, but excluding any underwriting discounts, selling commissions, or stock transfer taxes attributable to the sale of the Incentive Shares, which shall be borne by the Investor.
Section 3.3 — Tax Treatment
The Parties intend that the Incentive Shares constitute additional purchase price consideration or an adjustment to the purchase price of the Backstop Shares for U.S. federal income tax purposes. Each Party agrees to file all tax returns and reports consistently with such characterization and shall not take any position on any tax return, or in any tax proceeding or audit, that is inconsistent with such treatment, unless otherwise required by a final determination (within the meaning of Section 1313 of the Internal Revenue Code of 1986, as amended) by a court of competent jurisdiction or the Internal Revenue Service.
ARTICLE IV — REPRESENTATIONS AND WARRANTIES OF THE INVESTOR
The Investor hereby represents and warrants to PGAC as of the date hereof and as of the Closing Date (except where a representation or warranty speaks expressly as of a specific date, in which case such representation or warranty shall be made only as of such date) as follows:
Section 4.1 — Organization and Authority
The Investor is a limited partnership duly organized, validly existing, and in good standing under the laws of the State of Delaware. The Investor has the requisite limited partnership power and authority to own, lease, and operate its properties and assets and to carry on its business as presently conducted, and to execute, deliver, and perform this Agreement and the transactions contemplated hereby.
Section 4.2 — Authorization; Binding Effect
The execution, delivery, and performance of this Agreement by the Investor, and the consummation by the Investor of the transactions contemplated hereby, have been duly authorized by all necessary partnership action on the part of the Investor, including any required approvals of the Investor's general partner or investment committee. No other partnership proceedings on the part of the Investor are necessary to authorize this Agreement or the consummation of the transactions contemplated hereby. This Agreement has been duly executed and delivered by the Investor and constitutes the legal, valid, and binding obligation of the Investor, enforceable against the Investor in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer, and other similar laws affecting creditors' rights generally from time to time in effect and subject to general principles of equity, including concepts of materiality, reasonableness, good faith, and fair dealing (regardless of whether considered in a proceeding in equity or at law).
Section 4.3 — No Conflicts
The execution, delivery, and performance by the Investor of this Agreement and the consummation by the Investor of the transactions contemplated hereby do not and will not (a) conflict with or violate the Investor's certificate of limited partnership, limited partnership agreement, or any other organizational or governing document of the Investor, (b) conflict with or violate any law, rule, regulation, order, judgment, injunction, decree, or other legal requirement applicable to the Investor or by which any property or asset of the Investor is bound, or (c) conflict with, result in any breach of, constitute a default (or an event that, with notice or lapse of time or both, would become a default) under, give to others any right of termination, amendment, acceleration, or cancellation of, require any consent under, or result in the creation of a lien or encumbrance on any property or asset of the Investor pursuant to, any material contract, agreement, indenture, note, bond, loan, mortgage, license, permit, franchise, or other instrument or obligation to which the Investor is a party or by which the Investor or any of its properties or assets is bound.
Section 4.4 — Accredited Investor / Qualified Institutional Buyer Status
The Investor is an "accredited investor" as such term is defined in Rule 501(a) of Regulation D under the Securities Act and a "qualified institutional buyer" as such term is defined in Rule 144A under the Securities Act. The Investor is not a registered broker-dealer or an entity engaged in the business of being a broker-dealer. The Investor is not required to be registered as a broker-dealer under Section 15 of the Securities Exchange Act of 1934, as amended.
Section 4.5 — Investment Intent
The Investor is acquiring the Backstop Shares and will acquire the Incentive Shares for the Investor's own account (or for the account of its Designees, as applicable) for investment purposes only and not with a view to, or for sale in connection with, any distribution thereof in violation of the Securities Act or any applicable state securities laws. The Investor acknowledges that the Backstop Shares and the Incentive Shares have not been and, at the time of issuance, will not have been registered under the Securities Act or any state securities laws, and that such shares may not be offered, sold, assigned, pledged, hypothecated, or otherwise transferred except pursuant to an effective registration statement under the Securities Act, or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act, and in compliance with any applicable state securities laws.
Section 4.6 — Sophistication and Experience
The Investor has such knowledge and experience in financial and business matters, including with respect to investments in special purpose acquisition companies and de-SPAC transactions, that it is capable of evaluating the merits and risks of purchasing the Backstop Shares and receiving the Incentive Shares. The Investor is able to bear the economic risk of its investment in the Backstop Shares and the Incentive Shares for an indefinite period of time, and the Investor is able to afford a complete loss of such investment. The Investor acknowledges that it has been afforded the opportunity to ask questions of, and receive answers from, duly authorized representatives of PGAC's management, including Jonathan Mercer, Chief Executive Officer and Chairman, and Elaine Stratford, Chief Financial Officer, concerning the terms and conditions of the transactions contemplated by this Agreement and the Business Combination, and the financial condition, results of operations, business, properties, and prospects of PGAC and Skybridge, and to obtain such additional information as the Investor has deemed necessary to verify the accuracy of such information.
Section 4.7 — Sufficient Funds
The Investor has, and at the time the Investor is required to fund the purchase price for the Backstop Shares pursuant to Section 2.2 will have, cash or other immediately available funds sufficient to pay the aggregate purchase price for the Backstop Shares in an amount up to the Maximum Backstop Amount of Fifty-One Million Two Hundred Fifty Thousand Dollars ($51,250,000). The Investor's obligation to purchase the Backstop Shares is not subject to any financing condition or contingency.
Section 4.8 — No Short Sales
Neither the Investor nor any of its affiliates has engaged in, and neither the Investor nor any of its affiliates will engage in, any "short sales" (as defined in Rule 200 of Regulation SHO under the Securities Exchange Act of 1934, as amended) of any securities of PGAC at any time prior to the Closing, including any short sale, establishment of an open "put equivalent position" (within the meaning of Rule 16a-1(h) under the Securities Exchange Act of 1934, as amended), or grant of any right (including any put or call option) to a third party with respect to any securities of PGAC.
Section 4.9 — No Broker Fees
No broker, finder, financial advisor, investment banker, or other person is entitled to any brokerage commission, finder's fee, financial advisory fee, or similar payment from the Investor in connection with this Agreement or the transactions contemplated hereby, other than Pemberton Zanthor & Co. in its capacity as PIPE placement agent, whose fees and commissions are the sole responsibility of PGAC, and for which the Investor shall have no liability or obligation.
ARTICLE V — REPRESENTATIONS AND WARRANTIES OF PGAC
PGAC hereby represents and warrants to the Investor as of the date hereof and as of the Closing Date (except where a representation or warranty speaks expressly as of a specific date, in which case such representation or warranty shall be made only as of such date) as follows:
Section 5.1 — Organization and Authority
PGAC is a Cayman Islands exempted company duly incorporated, validly existing, and in good standing (to the extent such concept is recognized) under the laws of the Cayman Islands. PGAC has the requisite corporate power and authority to own, lease, and operate its properties and assets and to carry on its business as presently conducted, and to execute, deliver, and perform this Agreement and the transactions contemplated hereby.
Section 5.2 — Authorization; Binding Effect
The execution, delivery, and performance of this Agreement by PGAC, and the consummation by PGAC of the transactions contemplated hereby, have been duly authorized by all necessary corporate action on the part of PGAC, including approval by PGAC's board of directors. No other corporate proceedings on the part of PGAC are necessary to authorize this Agreement or the consummation of the transactions contemplated hereby (other than the approvals to be obtained at the EGM). This Agreement has been duly executed and delivered by PGAC and constitutes the legal, valid, and binding obligation of PGAC, enforceable against PGAC in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer, and other similar laws affecting creditors' rights generally from time to time in effect and subject to general principles of equity, including concepts of materiality, reasonableness, good faith, and fair dealing (regardless of whether considered in a proceeding in equity or at law).
Section 5.3 — Capitalization
(a) As of the date hereof, the issued and outstanding share capital of PGAC consists of:
(i) 30,000,000 Class A ordinary shares, par value $0.0001 per share, all of which are held by the public shareholders of PGAC;
(ii) 7,500,000 Class B ordinary shares, par value $0.0001 per share (the "Founder Shares"), all of which are held by the Sponsor, Ridgeway Capital Holdings LLC;
(iii) 10,000,000 public warrants (each exercisable for one Class A ordinary share at an exercise price of $11.50 per share, subject to adjustment), which were issued as part of the units sold in the IPO; and
(iv) 8,000,000 private placement warrants (each exercisable for one Class A ordinary share at an exercise price of $11.50 per share, subject to adjustment), all of which are held by the Sponsor, which were purchased at a price of $1.50 per warrant for an aggregate purchase price of $12,000,000.
(b) Except as described in Section 5.3(a), the BCA, the PIPE subscription agreements, the Sponsor Support Agreement, this Agreement, and as otherwise disclosed in PGAC's SEC filings, there are no outstanding options, warrants, rights, commitments, conversion rights, rights of exchange, plans, or other agreements of any character providing for the purchase, issuance, or sale of any shares of PGAC.
Section 5.4 — Valid Issuance of Backstop Shares and Incentive Shares
The Backstop Shares, when purchased by the Investor and registered in the name of the Investor (or its Designees) in accordance with this Agreement, will be duly authorized, validly issued, fully paid, and non-assessable, and will not be subject to any preemptive rights, rights of first refusal, or similar rights. The Incentive Shares, when issued to the Investor (or its Designees) in accordance with Article III, will be duly authorized, validly issued, fully paid, and non-assessable, and will not be subject to any preemptive rights, rights of first refusal, or similar rights. No shares of capital stock of PGAC or the Combined Company (as applicable) are subject to, or have been issued in violation of, any purchase option, call option, right of first refusal, preemptive right, subscription right, or any similar right under any provision of the DGCL, the Cayman Islands Companies Act, PGAC's organizational documents, or any contract to which PGAC is a party or by which PGAC is bound.
Section 5.5 — Trust Account
(a) The Trust Account has been established and is maintained at Glenridge National Bank, N.A., 60 Wall Street, New York, New York 10005, in accordance with the Investment Management Trust Agreement, dated as of October 17, 2023, between PGAC and the Trust Custodian. As of March 31, 2025, the Trust Account had a balance of approximately Three Hundred Twelve Million Six Hundred Thousand Dollars ($312,600,000), inclusive of interest earned on the amounts held therein.
(b) The funds held in the Trust Account are invested in United States government securities or money market funds that invest solely in United States government securities, as described in PGAC's IPO prospectus. PGAC has not released, disbursed, or authorized the release or disbursement of any funds from the Trust Account other than as permitted by the Investment Management Trust Agreement, and no claims have been made against the Trust Account (other than the right of Redeeming Shareholders to receive their pro rata share upon the exercise of redemption rights).
Section 5.6 — SEC Filings
PGAC has filed all reports, schedules, forms, statements, and other documents required to be filed by it under the Securities Act and the Securities Exchange Act of 1934, as amended, including all amendments, supplements, and exhibits thereto (the "PGAC SEC Documents"). As of their respective filing dates (or, if amended, as of the date of the last amendment prior to the date hereof), none of the PGAC SEC Documents contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. As of the date hereof, the Registration Statement on Form S-4 (File No. 333-294817; CIK No. 0001948372) has been filed with the SEC and is pending review.
Section 5.7 — No Undisclosed Liabilities
PGAC has no material liabilities, debts, or obligations (whether absolute, accrued, contingent, or otherwise, and whether or not required to be reflected or reserved against on a balance sheet in accordance with generally accepted accounting principles) other than (a) liabilities that are reflected or reserved against in the financial statements included in PGAC's Annual Report on Form 10-K for the fiscal year ended December 31, 2024, as filed with the SEC, (b) liabilities incurred in the ordinary course of PGAC's business since December 31, 2024 (none of which is a liability for breach of contract, breach of warranty, tort, infringement, or violation of law), (c) the deferred underwriting commission of Ten Million Five Hundred Thousand Dollars ($10,500,000) payable to Pemberton Zanthor & Co. upon the consummation of the Business Combination (representing 3.5% of the gross proceeds of the IPO of $300,000,000), and (d) liabilities arising under this Agreement, the BCA, the PIPE subscription agreements, and the other Transaction Documents.
Section 5.8 — Nasdaq Listing
PGAC's Class A ordinary shares are listed on the Nasdaq Capital Market, and PGAC is in compliance in all material respects with the applicable continued listing requirements of the Nasdaq Capital Market. PGAC has submitted a listing application with the Nasdaq Capital Market on May 5, 2025 for the listing of the Combined Company's shares of common stock and warrants following the consummation of the Business Combination under the proposed ticker symbol "SBFT." As of the date hereof, PGAC has not received any written notice from the Nasdaq Capital Market that the listing application will not be approved.
ARTICLE VI — COVENANTS
Section 6.1 — Notice of Redemption Results
PGAC shall promptly (and in any event within two (2) business days) notify the Investor of the preliminary and final redemption results following the deadline for PGAC Shareholders to exercise their redemption rights in connection with the EGM, including the total number of shares tendered for Redemption and the estimated per-share redemption price. PGAC shall keep the Investor reasonably informed of any changes to the redemption results, including any withdrawals or late tenders permitted under applicable law or PGAC's organizational documents.
Section 6.2 — Cooperation
Each Party shall use commercially reasonable efforts to take, or cause to be taken, all actions, and to do, or cause to be done, all things reasonably necessary, proper, or desirable under applicable laws to consummate the transactions contemplated by this Agreement as promptly as practicable, including (a) cooperating with Continental Registrars, Inc. (as Transfer Agent) and Glenridge National Bank, N.A. (as Trust Custodian) regarding the transfer and registration of Backstop Shares and the disbursement and receipt of funds from the Trust Account, (b) executing and delivering such additional instruments, documents, certificates, and agreements as may be reasonably requested by the other Party to carry out the provisions of this Agreement, (c) providing such information and data as the other Party may reasonably request in connection with regulatory filings and other matters, and (d) cooperating in good faith to resolve any issues or disputes that may arise in connection with the settlement mechanics described in Section 2.2(d).
Section 6.3 — No Modification of BCA Minimum Cash Condition
PGAC shall not, without the prior written consent of the Investor (which consent may be withheld in the Investor's sole and absolute discretion), amend, modify, waive, or consent to any amendment, modification, or waiver of the Minimum Cash Condition (requiring at least $200,000,000 of Available Cash at the Closing) set forth in the BCA, or any definition or component thereof, in any manner that would be materially adverse to the Investor. For the avoidance of doubt, any reduction in the Minimum Cash Condition below $200,000,000 shall be deemed materially adverse to the Investor for purposes of this Section 6.3.
Section 6.4 — Confidentiality
(a) Each Party shall, and shall cause its respective representatives, agents, and affiliates to, keep confidential the terms and conditions of this Agreement and the transactions contemplated hereby until such time as a public announcement is made with respect thereto, or disclosure is required by applicable law, regulation of the SEC, rules of the Nasdaq Capital Market, or by order of a court of competent jurisdiction. Prior to making any required public disclosure, the disclosing Party shall, to the extent practicable, consult with the other Party regarding the content and timing of such disclosure.
(b) Notwithstanding the foregoing, the Parties acknowledge and agree that this Agreement will be publicly filed as an exhibit to the Registration Statement on Form S-4 and/or a Current Report on Form 8-K filed by PGAC with the SEC, and that the terms of this Agreement may be described in the Proxy Statement/Prospectus. Each Party consents to such filing and disclosure.
Section 6.5 — Transfer Restrictions on Backstop Shares and Incentive Shares
(a) The Backstop Shares and the Incentive Shares shall not be subject to any lock-up, holding period, or transfer restriction other than those imposed by applicable federal and state securities laws (including any restrictions under Rule 144 of the Securities Act) and this Agreement.
(b) Notwithstanding Section 6.5(a), the Investor agrees that it shall not sell, transfer, assign, pledge, hypothecate, or otherwise dispose of any Incentive Shares for a period of thirty (30) calendar days following the Closing Date (the "Incentive Share Lock-Up Period"). During the Incentive Share Lock-Up Period, the Investor shall not, directly or indirectly, offer, sell, contract to sell, pledge, grant any option to purchase, make any short sale of, or otherwise dispose of or transfer any Incentive Shares, or enter into any swap, hedge, or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Incentive Shares.
(c) Any transfer or attempted transfer of Incentive Shares in violation of this Section 6.5 shall be null and void ab initio, and PGAC (or the Combined Company) shall not recognize or register any such transfer on its books and records. The Combined Company shall instruct the Transfer Agent to place a restrictive legend or stop-transfer instruction on the Incentive Shares reflecting the restrictions set forth in this Section 6.5.
Section 6.6 — Tax Reporting
The Parties shall cooperate in good faith with respect to the tax treatment of the transactions contemplated by this Agreement and shall file all tax returns and reports consistently with the characterization described in Section 3.3. Each Party shall promptly notify the other Party if any taxing authority challenges or proposes to challenge the agreed-upon tax treatment.
Section 6.7 — Notification of Changes
PGAC shall promptly (and in any event within two (2) business days) notify the Investor in writing of (a) any material amendment, supplement, modification, or waiver of any provision of the BCA (other than amendments that are solely administrative in nature), (b) any change in the projected timeline for the Business Combination, including any change in the projected date of the EGM (currently projected for July 18, 2025) or the projected Closing Date (currently projected for July 21, 2025), (c) any termination or threatened termination of the BCA (whether by PGAC, Skybridge, or otherwise), (d) any material adverse change in the financial condition or business of Skybridge that is known to PGAC, and (e) any material correspondence or communication with the SEC regarding the Registration Statement or with the Nasdaq Capital Market regarding the listing application for the Combined Company's shares.
Section 6.8 — Sponsor Forfeiture Acknowledgment
The Investor acknowledges and agrees that, pursuant to the Sponsor Support Agreement dated April 14, 2025, by and among the Sponsor, PGAC, and Skybridge, the Sponsor has agreed to forfeit 500,000 Class B ordinary shares (Founder Shares) at the Closing, with an additional 500,000 Class B ordinary shares to be forfeited in the event that Redemptions exceed seventy-five percent (75%) of the outstanding Class A ordinary shares (i.e., more than 22,500,000 shares are tendered for Redemption). The Investor acknowledges that it has reviewed the Sponsor Support Agreement and that the forfeiture provisions described therein were a material consideration in the negotiation of the BCA and the overall transaction economics. The Investor makes no claim to, and shall have no rights with respect to, any Founder Shares or any forfeiture or non-forfeiture thereof.
ARTICLE VII — CONDITIONS PRECEDENT
Section 7.1 — Conditions to Investor's Obligation to Purchase Backstop Shares
The obligation of the Investor to purchase the Backstop Shares pursuant to Article II is subject to the satisfaction (or waiver in writing by the Investor) of each of the following conditions as of the Closing Date:
(a) BCA Not Terminated. The BCA shall not have been terminated in accordance with its terms and shall be in full force and effect.
(b) Conditions to Closing Under the BCA. All conditions to the Closing of the Business Combination set forth in the BCA shall have been satisfied or waived (other than conditions that, by their nature, are to be satisfied at the Closing, but subject to the satisfaction or waiver of such conditions), including the following:
(i) the Registration Statement on Form S-4 (File No. 333-294817) shall have been declared effective by the SEC, and no stop order suspending the effectiveness of the Registration Statement shall have been issued and remain in effect;
(ii) the PGAC Shareholders shall have duly approved the Business Combination and the related proposals at the EGM by ordinary resolution (simple majority of votes cast at the meeting);
(iii) no governmental authority of competent jurisdiction shall have enacted, issued, promulgated, enforced, or entered any law, rule, regulation, executive order, decree, injunction, or other legal restraint that prohibits, enjoins, or makes illegal the consummation of the Business Combination;
(iv) the Nasdaq Capital Market shall have approved the listing of the Combined Company's shares of common stock and warrants on the Nasdaq Capital Market under the proposed ticker symbol "SBFT" (or such other ticker symbol as may be approved), subject only to official notice of issuance; and
(v) no material adverse effect (as defined in the BCA) shall have occurred with respect to Skybridge since April 14, 2025 that has not been cured or is otherwise continuing.
(c) Representations and Warranties of PGAC. The representations and warranties of PGAC contained in Article V of this Agreement shall be true and correct in all material respects (or, with respect to representations and warranties that are qualified by materiality or "material adverse effect," true and correct in all respects) as of the date hereof and as of the Closing Date as though made on and as of the Closing Date (except to the extent that any such representation and warranty expressly speaks as of a specific date, in which case such representation and warranty shall be true and correct in all material respects as of such specific date).
(d) PGAC Covenants. PGAC shall have performed and complied in all material respects with all covenants and agreements required to be performed or complied with by it under this Agreement at or prior to the Closing Date.
(e) Redemption Notice. PGAC shall have delivered the Redemption Notice to the Investor in accordance with Section 2.2(a), and such Redemption Notice shall accurately reflect the final redemption results.
Section 7.2 — Conditions to PGAC's Obligations
The obligation of PGAC to consummate the transactions contemplated by this Agreement, including the issuance of the Incentive Shares, is subject to the satisfaction (or waiver in writing by PGAC) of each of the following conditions as of the Closing Date:
(a) Representations and Warranties of the Investor. The representations and warranties of the Investor contained in Article IV of this Agreement shall be true and correct in all material respects (or, with respect to representations and warranties that are qualified by materiality, true and correct in all respects) as of the date hereof and as of the Closing Date as though made on and as of the Closing Date (except to the extent that any such representation and warranty expressly speaks as of a specific date, in which case such representation and warranty shall be true and correct in all material respects as of such specific date).
(b) Investor Covenants. The Investor shall have performed and complied in all material respects with all covenants and agreements required to be performed or complied with by it under this Agreement at or prior to the Closing Date.
(c) Funding of Backstop Purchase Price. The Investor shall have deposited the aggregate purchase price for the Backstop Shares (calculated as the number of Backstop Shares set forth in the Redemption Notice multiplied by the Per Share Backstop Price of $10.25) with the Trust Custodian, Glenridge National Bank, N.A., by wire transfer of immediately available funds in accordance with the wire instructions set forth in the Redemption Notice, no later than one (1) business day prior to the anticipated Closing Date.
ARTICLE VIII — TERMINATION
Section 8.1 — Termination Events
This Agreement shall automatically terminate, without any further action on the part of either Party, upon the earliest to occur of any of the following:
(a) Mutual Written Agreement. The mutual written agreement of PGAC and the Investor to terminate this Agreement.
(b) Termination of BCA. The valid termination of the BCA in accordance with its terms, for any reason or no reason; provided that PGAC shall promptly notify the Investor in writing of any such termination.
(c) Outside Date. The Outside Date (initially, October 14, 2025, or, if extended pursuant to the terms of the BCA, January 14, 2026), if the Closing has not occurred on or prior to such date; provided that the right to terminate this Agreement pursuant to this Section 8.1(c) shall not be available to any Party whose material breach of this Agreement has been the principal cause of the failure of the Closing to occur on or prior to such date.
(d) Material Breach by PGAC. A written notice of termination delivered by the Investor to PGAC if PGAC is in material breach of any of its representations, warranties, covenants, or agreements contained in this Agreement, and such breach has not been cured within ten (10) business days after the Investor has delivered written notice of such breach to PGAC specifying in reasonable detail the nature of such breach; provided that the Investor shall not have the right to terminate this Agreement pursuant to this Section 8.1(d) if the Investor is then in material breach of this Agreement.
(e) Material Breach by Investor. A written notice of termination delivered by PGAC to the Investor if the Investor is in material breach of any of its representations, warranties, covenants, or agreements contained in this Agreement, and such breach has not been cured within ten (10) business days after PGAC has delivered written notice of such breach to the Investor specifying in reasonable detail the nature of such breach; provided that PGAC shall not have the right to terminate this Agreement pursuant to this Section 8.1(e) if PGAC is then in material breach of this Agreement.
Section 8.2 — Effect of Termination
(a) Upon the termination of this Agreement pursuant to Section 8.1, this Agreement shall become void and of no further force or effect, and no Party (or any of its affiliates, representatives, or agents) shall have any liability or obligation hereunder or with respect hereto; provided, however, that:
(i) no termination of this Agreement shall relieve any Party of liability for any willful and material breach of this Agreement by such Party that occurred prior to such termination; and
(ii) the provisions of this Article VIII (Termination) and Article IX (Miscellaneous) shall survive any termination of this Agreement and shall remain in full force and effect.