-1-

AGREEMENT

CLOTHILDE V. HEWLETT

Commissioner

MARY ANN SMITH

Deputy Commissioner

SEAN ROONEY

Assistant Chief Counsel

JEREMY F. KOO (State Bar No. 300225)

Senior Counsel

Department of Financial Protection and Innovation

320 West 4

th

Los Angeles, California 90013

Telephone: (213) 819-0358

Emails: [email protected]; [email protected]

Attorneys for Complainant

Respondent.

This Agreement is entered into between the Commissioner of Financial Protection and

Innovation (Commissioner and Department) and SALT Lending LLC (SALT), formerly known as

///

-2-

AGREEMENT

RECITALS

A. The Commissioner has jurisdiction over the licensing and regulation of persons and

entities engaged in the business of finance lending or brokering under the California Financing Law

(CFL) (Fin. Code, § 22000 et seq.).

Shawn Owen stating, “I am sorry to report that the collapse of FTX has impacted our business. Until

we are able to determine the extent of this impact with specific details that we feel confident are

factually accurate, we have paused deposits and withdrawals on the SALT platform effective

immediately.”

G. The Commissioner has been investigating the extent to which SALT has been

affected by the bankruptcy of FTX Trading Ltd. and related companies.

H. On November 15, 2022, the Commissioner issued and served a notification to SALT

that she would, three days after service of the notification, suspend the CFL license of SALT, No.

60DBO-87584, for a period of 30 days, pending investigation, under California Financial Code

-3-

AGREEMENT

2

J. On December 2, 2022, the Department had a Microsoft Teams call with SALT

representatives, including the General Counsel, in which SALT represented the following to the

Commissioner:

1) Since at least November 16, 2022, SALT has not collected repayments on loans

belonging to California residents.

2) Since at least November 16, 2022, SALT has not collected interest payments or

payment processes.

K. The Commissioner finds that entering into this Agreement is in the public interest and

consistent with the purposes fairly intended by the policies and provisions of the CFL.

NOW, THEREFORE, in consideration of the foregoing, and the terms and conditions set

forth herein, the parties agree as follows:

TERMS AND CONDITIONS

1. Purpose. The parties intend to resolve this matter for the purpose of judicial economy

and expediency and without the uncertainty and expense of a hearing or other litigation.

2. SALT. SALT agrees to the following:

-4-

AGREEMENT

c) SALT will otherwise pause collection on loans belonging to California residents

while SALT’s CFL License is suspended or as further agreed to between the

parties.

d) SALT will return any interest earned, accrued, or otherwise charged to borrowers

that are California residents while SALT’s CFL License is suspended or as further

agreed to between the parties.

any amount of crypto assets belonging to California residents. If SALT later

seeks to transfer crypto assets belonging to California residents back to these

residents solely for these residents’ benefit, SALT will first notify the

Department.

g) SALT will not charge customer accounts belonging to California residents via

Automated Clearing House or other similar payment processes.

h) SALT agrees that it will not directly advertise or otherwise market financial

products and services to California residents either through its website or direct-

to-consumer advertising or marketing campaigns while its CFL License is

suspended. Notwithstanding the foregoing, SALT may continue to maintain and

-5-

AGREEMENT

j) Within one day of the Date of Execution of this Agreement, SALT will delete the

following language from its webpage at https://faq.saltlending.com/en_us/how-

does-a-salt-loan-work-B1RtbqR65: “Loan Completion - Upon payment of the

loan, the borrower’s collateral is freely available for withdrawal.”

k) Upon the expiration of the suspension of SALT’s CFL license (60DBO-87584)

under California Financial Code section 22710 on December 22, 2022, SALT

law against SALT. SALT reserves any and all rights and defenses should such an action be brought

available under law, including, but not limited to, all rights and defenses available under the CFL.

4. Future Actions by Commissioner. If, after providing SALT with due notice and an

opportunity to be heard, the Commissioner determines that SALT failed to comply with the terms of

the Agreement, the Commissioner may institute proceedings for any and all matters otherwise

resolved under this Agreement. The Commissioner reserves the right to bring any actions against

SALT, or any of its partners, owners, officers, shareholders, directors, employees or successors for

any and all violations of the CFL or any other provision of law. SALT reserves any and all of its

rights and defenses should such an action be commenced, including, but not limited to, all rights and

defenses available under the CFL.

-6-

AGREEMENT

intend no presumption for or against the drafting party will apply in construing any part of this

Agreement. The parties waive the benefit of Civil Code section 1654 as amended or corresponding

provisions of any successor statute, which provide that in cases of uncertainty, language of a contract

should be interpreted most strongly against the party who caused the uncertainty to exist.

7. Independent Legal Advice. Each of the parties represents, warrants, and agrees that it

has had the opportunity to receive independent advice from an attorney(s) and/or representatives

10. Reliance. Each of the parties represents, warrants, and agrees that in executing this

Agreement, it has relied solely on the statements set forth herein and the advice of its own legal

counsel, if represented. Each of the parties further represents, warrants, and agrees that in executing

this Agreement it has placed no reliance on any statement, representation, or promise of any other

party, or any other person or entity not expressly set forth herein, or upon the failure of any party or

any other person or entity to make any statement, representation, or disclosure of anything

whatsoever. The parties have included this clause: (1) to preclude any claim that any party was in

any way fraudulently induced to execute this Agreement; and (2) to preclude the introduction of

parol evidence to vary, interpret, supplement, or contradict the terms of this Agreement.

11. Waiver, Amendments, and Modifications. No waiver, amendment, or modification of

-7-

AGREEMENT

12. Full Integration. This Agreement is the final written expression and the complete and

exclusive statement of all the agreements, conditions, promises, representations, and covenants

between the parties with respect to the subject matter hereof, and supersedes all prior or

contemporaneous agreements, negotiations, representations, understandings, and discussions

between and among the parties, their respective representatives, and any other person or entity, with

respect to the subject matter covered hereby.

constitute a single document.

15. Effect Upon Future Proceedings. If SALT applies for any license, permit or

qualification under the Commissioner’s current jurisdiction, or are the subject of any future action by

the Commissioner to enforce this Agreement, then the subject matter hereof shall be admitted for the

purpose of such application(s) or enforcement proceeding(s). Notwithstanding the foregoing, SALT

shall not be denied a license, permit, or qualification solely because it has entered into this

Agreement.

16. Voluntary Agreement. SALT hereby enters into this Agreement voluntarily and

without coercion and acknowledges that no promises, threats, or assurances have been made by the

Commissioner or any officer, or agent thereof, about this Agreement. The parties each represent and

-8-

AGREEMENT

3

18. Signatures. A fax or electronic mail signature shall be deemed the same as an

19. Public Record. SALT hereby acknowledges that the Agreement is and will be a

20. Effective Date. This Agreement shall become final and effective when signed by all

address: Alex.Fader@saltlending.com.

21. Authority to Sign. Each signatory hereto covenants that he/she possesses all

necessary capacity and authority to sign and enter into this Agreement and undertake the obligations

set forth herein.

///

///

///

-9-

AGREEMENT

1

2

3

4

5

6

Dated: December 8, 2022

Deputy Commissioner

Enforcement Division

Dated: December 8, 2022 SALT LENDING LLC

PRINTED NAME

TITLE