On January 11, 2022 (the “Closing Date”), Nam Tai Property Inc., a company incorporated under the laws of the British Virgin Islands (the “Company”), entered into unsecured delayed-draw term loans, evidenced by promissory notes, with IAT Insurance Group Inc. (“IAT”) and IsZo Capital LP (“IsZo”). The promissory note entered into between the Company and IAT (the “IAT Note”) provides for a loan in an initial aggregate principal amount of up to $15.0 million, which amount may be increased by an additional $10.0 million with the consent of IAT and the Company. The promissory note entered into between the Company and IsZo (the “IsZo Note” and together with the IAT Note, the “Notes”) provides for a loan in an initial aggregate principal amount of up to $5.0 million, which amount may be increased by an additional $10.0 million with the consent of IsZo and the Company.

Each Note accrues interest at a rate of 10% per annum, to be paid in-kind quarterly by increasing the then outstanding principal balance. The Notes will mature on January 11, 2024 but may be prepaid, in whole or in part, at the option of the Company. Upon repayment of the outstanding principal under each Note (or any portion thereof), commencing six months after the initial funding, the Company is required to pay an additional rate on the principal amount being repaid, ranging from 1.5% to 6% with the rate increasing on later repayment dates.

Pursuant to the terms of the Notes, an event of default will occur upon, among other things, failure to make payments on the Notes when due, use of proceeds of the Notes not in accordance with the Notes, or commencing of certain bankruptcy or insolvency proceedings. On the Closing Date, $3.75 million was funded under the IAT Note and $1.25 million was funded under the IsZo Note.