Item 1.01. Entry into a Material Definitive Agreement.




Settlement Agreement

As previously disclosed in Princeton Capital Corporation's (the "Company") prior filings with the Securities and Exchange Commission (the "SEC"), on March 14, 2019, the Company filed a lawsuit (the "State Litigation") in the 165th District Court of Harris County, Texas (the "Texas District Court") against Great Value Storage, LLC ("GVS"), World Class Capital Group, LLC ("World Class"), and Natin Paul. GVS is one of the Company's portfolio companies. The State Litigation is captioned as Princeton Capital Corporation v. Great Value Storage, et al., Case No. 2019-18855. On March 9, 2021, the Texas District Court ordered that GVS and World Class were liable to the Company for contract damages of $9,759,713.84 and attorneys' fees of $150,887.50 (the "Judgment"). On September 8, 2021, the court granted the appointment of a receiver.

As also previously disclosed in the Company's prior filings with the SEC, certain affiliated parties of GVS, including GVS Texas Holdings I, LLC, have filed a voluntary petition for relief (the "Bankruptcy Cases") under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Northern District of Texas (the "Bankruptcy Court"). On April 27, 2022, the Company commenced an adversary proceeding in the Bankruptcy Court captioned Princeton Capital Corporation v. GVS Texas Holdings I, LLC, et al, Adv. Proceeding No. 22-03043 (the "Adversary Proceeding") alleging causes of action against certain related parties for, among other things, fraudulent transfer and breach of contract.

On September 2, 2022, the Company, Natin Paul (on behalf of himself individually and on behalf of all entities that he either owns or controls), Natin Paul (on behalf of all adversary defendants in the Adversary Proceeding), Natin Paul (on behalf of the reorganized debtors in the Bankruptcy Cases), World Class Holdings I, LLC, and Phoenix Lending, LLC, as the Assignee of the Transaction Documents (including certain Promissory Notes) that were the subject of the State Litigation, entered into a settlement, assignment and acceptance agreement (the "Settlement Agreement") pursuant to which, pending approval by the Bankruptcy Court and certain other conditions precedent, the Assignee will pay to the Company the amount of $11,372,698.89 within three (3) days after the Bankruptcy Court's approval and the completion of certain other conditions precedent set forth in the Settlement Agreement, in exchange for (i) duly endorsed Transaction Documents, (ii) notices of dismissal with prejudice in the Adversary Proceeding, (iii) notices of the assignment of the Promissory Notes and Judgment, and (iv) notices withdrawing certain claims by the Company.

The foregoing description of the Settlement Agreement does not purport to be complete and is qualified in its entirety by the text of the agreement, a copy of which is expected to be filed as an exhibit to the Company's Form 10-Q for the quarter ended September 30, 2022.


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