On May 2, 2025, Algorhythm Holdings, Inc. (the "Company") issued a promissory note in the principal amount of $1,750,000 (the "Promissory Note") to SemiCab, Inc., a Delaware corporation (the "Seller"), pursuant to an equity purchase agreement (the "Equity Purchase Agreement") among the Company and its subsidiary, SemiCab Holdings, LLC, a Nevada limited liability company ("SemiCab Holdings"), and the Seller. The Promissory Note provides that $1,500,000 is due and payable by the Company on the first anniversary of the date of issuance, or May 2, 2026 (the "Initial Payment"), and the remaining $250,000 is due and payable by the Company on the 18-month anniversary of the date of issuance, or November 2, 2026.
On May 9, 2026, the Company and the Seller entered into a forbearance agreement pursuant to which: (i) the Seller irrevocably waived any default or event of default that was or will be caused under the Promissory Note as a result of the Company’s failure to pay the Initial Payment to the Seller on May 2, 2026, and (ii) the Seller will forbear from taking action with respect to any defaults or events of default arising after the date of the forbearance agreement with respect to the Company’s failure to make such payment that occur at any time on or prior to June 16, 2026.
On June 16, 2026, the Company and the Seller entered into a second forbearance agreement pursuant to which: (i) the Seller irrevocably waived any default or event of default that was or will be caused under the Promissory Note as a result of the Company’s failure to pay the Initial Payment to the Seller on May 2, 2026, and (ii) the Seller will forbear from taking action with respect to any defaults or events of default arising after date of the forbearance agreement with respect to the Company’s failure to make such payment that occur at any time on or prior to July 16, 2026.