LOAN AGREEMENT

 

for a loan in the amount of up to

 

$1,500,000.00

MADE BY AND BETWEEN GREENWAY TECHNOLOGIES, INC.

a Texas corporation, as Borrower the Lenders party hereto

AND

 

MABERT, LLC,

a Texas limited liability company, as Agent

 

 

 

Dated as of September [14], 2018

 

 

 

 

LOAN AGREEMENT

 

PREAMBLE

 

THIS LOAN AGREEMENT (“Agreement”) is made as of September [14], 2018, by and
among each of GREENWAY TECHNOLOGIES, INC., a Texas corporation (the “Borrower”),
the lenders party hereto (the “Lenders”) and MABERT, LLC, a Texas limited
liability company, its successors and assigns, as agent for the Lenders
(“Agent”).

 

 

W I T N E S S E T H:

 

RECITALS

 

 

A. Borrower has applied to Lenders for a loan in the amount of up to ONE MILLION
FIVE HUNDRED THOUSAND DOLLARS ($1,500,000.00) (the “Loan”) for the purpose of
funding working capital and general corporate expenses, and Lender is willing to
make the Loan on the terms and conditions hereinafter set forth.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein
contained, the parties hereto agree as follows:

 

 

 

 

1.1       Defined Terms.

 

ARTICLE I DEFINITIONS

 

The following terms as used herein shall have the following meanings: Agreement:
As such term is defined in the Preamble.

Applicable Rate: At any time, the lower of (a) the interest rate specified in
each Note, or (b) the Maximum Lawful Rate.

 

Bankruptcy Code: Title 11 of the United States Code entitled “Bankruptcy” as now
or hereafter in effect, or any successor thereto or any other present or future
bankruptcy or insolvency statute.

 

Borrower: As such term is defined in the Preamble. Collateral: As such term is
defined in the Security Agreement.

Default or default: Any event, circumstance or condition, which, if it were to
continue uncured, would, with notice or lapse of time or both, constitute an
Event of Default hereunder.

 

 

Default Rate: A rate per annum equal to three percentage points (300 basis
points) in excess of the Applicable Rate, but which shall not at any time exceed
the Maximum Lawful Rate.

 

Event of Default: As such term is defined in Article 6.

 

Governmental Authority: Any federal, state, county or municipal government, or
political subdivision thereof, any governmental or quasi-governmental agency,
authority, board, bureau, commission, department, instrumentality, or public
body, or any court, administrative tribunal, or public utility.

 

Laws: Collectively, all federal, state and local laws, statutes, codes,
ordinances, orders, rules and regulations, including judicial opinions or
precedential authority in the applicable jurisdiction.

 

Lender: As defined in the opening paragraph of this Agreement, and including any
successor holder of the Loan from time to time.

 

Loan: As defined in Recital A.

Loan Documents: Collectively, this Agreement, the Security Agreement and the
Notes. Material Adverse Change: If, in Agent’s reasonable discretion, the
business prospects,

operations or financial condition of a person, entity or property has changed in
a manner which could

impair the value of Lenders’ security for the Loan, prevent timely repayment of
the Loan or otherwise prevent the applicable person or entity from timely
performing any of its material obligations hereunder or under the Note.

 

Maturity Date: As set forth in each Note.

 

Maximum Lawful Rate: As such term is defined in the Notes.

 

Note: Each promissory note, executed by Borrower and payable to the order of
Lenders, evidencing the Loan.

 

Open the Loan, Opening of the Loan or Loan Opening: The first disbursement of
Loan proceeds.

 

Payment Date: With respect to each Note, the last day of each calendar quarter,
beginning on the last day of the calendar quarter during which such Lender
initially loans funds under said Note.

 

Security Agreement: That certain Security Agreement, dated as of the date
hereof, by Borrower in favor of Agent, as agent for the Lenders.

 

Warrant: Each warrant, executed by Borrower for the benefit of each Lender,
evidencing a right to purchase shares of the Borrower as set forth therein.

 

 

 

ARTICLE II

BORROWER’S REPRESENTATIONS AND WARRANTIES

 

 

2.1Representations and Warranties.

 

To induce Lender to execute this Agreement and perform its obligations
hereunder, the Borrower hereby represents and warrants to Lender as follows:

 

(a)                The Borrower is a duly organized and validly existing limited
corporation and has full power and authority to execute, deliver and perform the
Loan Documents, and such execution, delivery and performance have been duly
authorized by all requisite action on the part of the Borrower.

 

(b)               No consent, approval or authorization of or declaration,
registration or filing with any Governmental Authority or nongovernmental person
or entity, including any creditor, partner, or shareholder of the Borrower, is
required in connection with the execution, delivery and performance of the Loan
Documents. The execution, delivery and performance of the Loan Documents have
not constituted and will not constitute, upon the giving of notice or lapse of
time or both, a breach or default under any other agreement to which the
Borrower is a party or may be bound or affected, or a violation of any Law or
court order which may affect the Borrower or the Collateral, any part thereof,
any interest therein, or the use thereof.

 

(c)                Borrower has been advised by the Lenders to seek the advice
of an attorney and an accountant in connection with the Loan. The Borrower has
had the opportunity to seek the advice of an attorney and accountant of the
Borrower's choice in connection with the Loan.

 

(d)There is no Default or Event of Default under the Loan Documents.

 

2.2Survival of Representations and Warranties.

 

Borrower agrees that all of the representations and warranties set forth in this
Agreement are true as of the date hereof, will be true at the Loan Opening and,
except for matters which have been disclosed by Borrower and approved by Lender
in writing, at all times thereafter. Each request for a disbursement hereunder
shall constitute a reaffirmation of such representations and warranties, as
deemed modified in accordance with the disclosures made and approved as
aforesaid, as of the date of such request.

 

ARTICLE III LOAN

 

3.1Agreement to Borrow and Lend; Lender’s Obligation to Disburse.

 

Subject to the terms, provisions and conditions of this Agreement and the other
Loan Documents, Borrower agrees to borrow from Lenders and Lenders agree to lend
to Borrower the Loan, for the purposes and subject to all of the terms,
provisions and conditions contained in this Agreement.

 

(a)                The maximum aggregate amount of the Loan shall not exceed One
Million Five Hundred Thousand Dollars ($1,500,000.00).

 

(b)                Each Lender agrees, upon Borrower’s compliance with and
satisfaction of all conditions precedent to the Loan Opening, no Material
Adverse Change has occurred with respect to

 

 

Borrower and no Default or Event of Default has occurred and is continuing
hereunder, to loan the Borrower the amount set forth opposite such Lender on
Schedule A hereto.

 

(c)                  Additional Lenders may become party to this Loan Agreement,
by delivery by such Lenders and acceptance by Borrower of a signature page
hereto. Schedule A hereto shall be updated to reflect the amount of the Loan
made by any such additional Lender.

 

3.2Term of the Loan.

 

All principal, interest and other sums due hereunder and under the Note shall be
due and payable in full on the Maturity Date.

 

 

 

 

4.1Interest Rate.

ARTICLE IV INTEREST

 

(a)                The Loan will bear interest at the Applicable Rate, unless
the Default Rate is applicable. The Loan shall bear interest at the Default Rate
at any time at which an Event of Default shall exist. Interest at the Applicable
Rate (or Default Rate) shall be calculated for the actual number of days elapsed
on the basis of a 365-day year, including the first date of the applicable
period to, but not including, the date of repayment.

 

4.2Payment Dates.

 

Borrower shall make payments of all accrued but unpaid interest quarterly in
arrears on each Payment Date.

 

4.3Prepayment; Extension.

Borrower shall not be allowed to prepay the Loan prior to the Maturity Date.
Each Lender, at its discretion, may offer to extend the Maturity Date of its
Note by one year. Such offer shall be made in writing, not less than thirty (30)
days prior, nor more than sixty (60) days prior, to the Maturity Date. Upon
receipt of such offer, Borrower shall have twenty (20) days to accept or reject
such extension. An extension of one Lender’s Note shall not affect the
Borrower’s obligation to pay the other Lenders’ Notes on the Maturity Date.

 

4.4Pro Rata Payments.

 

Borrower shall make all payments hereunder to the Agent. Agent shall distribute
all such payments, to the Lenders, pro rata based on the Lenders’ Loan
Commitments and Amounts as shown on Schedule A hereto; provided that regular
payments of interest shall be distributed to the Lenders, pro rata based on the
amount of interest owing to such Lender on the relevant Payment Date.

 

4.5Costs and Expenses.

 

Borrower shall reimburse Agent and the Lenders for all costs and expenses
incurred in connection with the negotiation, structuring and documentation of
the Loan, and for all costs and

 

 

expenses incurred in connection with the administration or collection of the
Loan, including in connection with any amendments or modifications thereto.

 

 

 

 

 

 

 

 

 

5.1Conditions Precedent.

ARTICLE V REQUIREMENTS PRECEDENT

TO DISBURSEMENTS

 

Borrower agrees that the Lenders’ obligation to Open the Loan is conditioned
upon Borrower’s delivery, performance and satisfaction of the following
conditions precedent in form and substance satisfactory to Lender in its
reasonable discretion:

 

(a)No Default: There shall exist no Default or Event of Default hereunder;

 

(b)               Additional Documents: Borrower shall have executed and
delivered the Loan Documents and furnished to Agent and the Lenders such other
documents or information as Agent and the Lenders shall reasonably request.

 

 

 

 

6.1Events of Default.

 

ARTICLE VI EVENTS OF DEFAULT

 

The occurrence of any one or more of the following shall constitute an “Event of
Default” as said term is used herein:

 

(a)                Failure of Borrower (i) (A) to make any payment of principal
on the Maturity Date, or interest when due on a Payment Date, or (B) to observe
or perform any of the other covenants or conditions by Borrower to be performed
under the terms of this Agreement or the other Loan Documents concerning the
payment of money, for a period of ten (10) days after written notice from Lender
that the same is due and payable; or (ii) for a period of ten (10) days after
written notice from Lender, to observe or perform any non-monetary covenant or
condition contained in this Agreement or the Note; provided that if any such
failure concerning a non-monetary covenant or condition is susceptible to cure
and cannot reasonably be cured within said ten (10) day period, then Borrower
shall have an additional thirty (30) day period to cure such failure and no
Event of Default shall be deemed to exist hereunder so long as Borrower
commences such cure within the initial ten (10) day period and diligently and in
good faith pursue such cure to completion within such resulting forty

(40) day period from the date of Lender’s notice; and provided further that if
another subsection of this Section 6.1 applies to a particular breach and does
not expressly provide for a notice or grace period the specific provision shall
control.

 

(b)               If any representation or warranty made now or hereafter by
Borrower is untrue or incorrect at the time made or delivered, provided that if
such breach is reasonably susceptible of cure,

 

 

then no Event of Default shall exist so long as Borrower cures said breach (i)
within the notice and cure period provided in (a)(i) above for a breach that can
be cured by the payment of money or

(ii) within the notice and cure period provided in (a)(ii) above for any other
breach.

 

(c)                Borrower shall commence a voluntary case under the Bankruptcy
Code; or an involuntary proceeding is commenced against Borrower under the
Bankruptcy Code and relief is ordered against Borrower, or the petition is
controverted but not dismissed or stayed within sixty (60) days after the
commencement of the case, or a custodian (as defined in the Bankruptcy Code) is
appointed for or takes charge of all or substantially all of the property of
Borrower; or Borrower commences any other proceedings under any reorganization,
insolvency or liquidation or similar Law of any jurisdiction relating to
Borrower; or there is commenced against Borrower any such proceeding which
remains undismissed or unstayed for a period of sixty (60) days; or Borrower
fails to controvert in a timely manner any such case under the Bankruptcy Code
or any such proceeding, or any order of relief or other order approving any such
case or proceeding is entered; or Borrower by any act or failure to act
indicates its consent to, approval of, or acquiescence in any such case or
proceeding or the appointment of any custodian or the like of or for it for any
substantial part of its property or suffers any such appointment to continue
undischarged or unstayed for a period of sixty

(60) days.

 

(d)               Borrower shall make an assignment for the benefit of
creditors, or shall admit in writing its inability to pay its debts generally as
they become due, or shall consent to the appointment of a receiver or trustee or
liquidator of all of its property or the major part thereof or if all or a
substantial part of the assets of Borrower are attached, seized, subjected to a
writ or distress warrant, or are levied upon, or come into the possession of any
receiver, trustee, custodian or assignee for the benefit of creditors.

 

(e)If a Material Adverse Change occurs with respect to a Borrower or the
Collateral.

 

ARTICLE VII

LENDER’S REMEDIES IN EVENT OF DEFAULT

 

7.1Remedies Conferred Upon Lender.

 

Upon the occurrence of any Event of Default, Agent may pursue any one or more of
the following remedies concurrently or successively, it being the intent hereof
that none of such remedies shall be to the exclusion of any other:

 

(a)                Withhold further disbursement of the proceeds of the Loan
and/or terminate the Lenders’ obligations to make further disbursements
hereunder;

 

(b)Declare the Notes to be immediately due and payable;

 

(c)                Exercise or pursue any other remedy or cause of action
permitted under this Agreement or the other Loan Documents, or conferred upon
Agent or the Lenders by operation of Law.

 

Notwithstanding the foregoing, upon the occurrence of any Event of Default under
Section 6.1(d) or (e) with respect to Borrower, all amounts evidenced by the
Notes shall automatically

 

 

become due and payable, without any presentment, demand, protest or notice of
any kind to Borrower.

 

 

 

 

8.1Modification; Waiver.

 

ARTICLE VIII GENERAL PROVISIONS

 

No modification, waiver, amendment or discharge of this Agreement or the other
Loan Documents shall be valid unless the same is in writing and signed by the
party against which the enforcement of such modification, waiver, amendment or
discharge is sought.

 

8.2Governing Law.

 

Irrespective of the place of execution and/or delivery, this Agreement shall be
governed by, and shall be construed in accordance with, the laws of the State of
Texas.

 

8.3Disclaimer by Lender.

 

This Agreement is made for the sole benefit of Borrower, Agent and Lenders, and
no other person or persons shall have any benefits, rights or remedies under or
by reason of this Agreement, or by reason of any actions taken by Agent or
Lenders pursuant to this Agreement.

 

8.4Notices.

 

Any notice, demand, request or other communication which any party hereto may be
required or may desire to give hereunder shall be in writing and shall be deemed
to have been properly given

(a) if hand delivered, when delivered; (b) if mailed by United States Certified
Mail (postage prepaid, return receipt requested), three (3) business days after
mailing; (c) if by Federal Express or other reliable overnight courier service,
on the next business day after delivered to such courier service or

(d) if by telecopier on the day of transmission so long as a copy is sent on the
same day by overnight courier to such party’s address as set forth on the
signature page hereto, or at such other address as the party to be served with
notice may have furnished in writing to the party seeking or desiring to serve
notice as a place for the service of notice.

 

8.5Authorized Representative.

 

The Borrower hereby appoints Ransom Jones, or his successor as chief financial
officer, as its authorized representative for purposes of dealing with the Agent
and the Lenders on behalf of Borrower in respect of any and all matters in
connection with this Agreement, the other Loan Documents, and the Loan.

 

8.6Assignments and Transfers.

 

Borrower shall not assign or attempt to assign its rights under this Agreement
and any purported assignment shall be void. Subject to the foregoing
restrictions on transfer and assignment, this Agreement shall inure to the
benefit of and shall be binding on the parties hereto and their respective
successors and permitted assigns.

 

 

 

8.7Waiver of Jury Trial.

 

BORROWER, AGENT AND LENDERS EACH WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY
ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT AND
THE NOTE OR RELATING THERETO OR ARISING FROM THE LENDING RELATIONSHIP WHICH IS
THE SUBJECT OF THIS AGREEMENT AND AGREE THAT ANY SUCH ACTION OR PROCEEDING SHALL
BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.

 

8.8No Oral Agreements.

 

THIS WRITTEN LOAN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES
AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
THE PARTIES.

 

[Signature page follows.]

 

 

EXECUTED as of the date first set forth above.

 

BORROWER:

 

GREENWAY TECHNOLOGIES, INC.,

a Texas corporation

 

By: /s/ Ransom Jones

Name: Ransom Jones

Title: Chief Financial Officer

 

 

Address for notices:

 

1521 N. Cooper Street

Suite 205 Arlington, TX 76011 Facsimile:

 

 

AGENT:

 

MABERT, LLC,

a Texas limited liability company

 

By: /s/ Kevin Jones

Name: Kevin Jones

Title: Managing Member

Facsimile:                   

 

Address for notices:

 

 

 

 

ADDITIONAL LENDERS – AS FOLLOWS BELOW:

 

 

LENDERS:

 

ALL COMMERCIAL FLOORS, INC.,

a Texas corporation

 

By: /s/ KevinJones

Name:Kevin Jones

Title: President       

Facsimile:              

Address for notices:

 

 

 

Facsimile:

 

 

 

CHRISTINE EARLY

an Individual

 

By: /s/ Christine Earley

Name:Christine Earley

 

Address for notices:

 

 

 

Facsimile:                  

 

 

 

RANDY PATTERSON

an Individual

 

By: /s/ Randy Patterson

Name: Randy Patterson

 

Address for notices:

Facsimile:                  

 

 

 

 

 

 

MICHAEL WYRENT

an Individual

 

 

By: /s/ Michael Wyrent

Name:Michael Wyrent

 

Address for notices:

 

                     Facsimile:                  

 

 

 

 

R. KEVIN JONES

an Individual

 

By: /s/ Kevin Jones

Name:Kevin Jones

 

 

 

 

 

 

 

ADDITIONAL LENDER(S):

 

 

 

 

 

 

 

 

 

Schedule A

 

Loan Commitments and Amounts

 

 

Lender Loan Amount Date Randy Patterson $100,000 9/14/2018 Christine Earley
$100,000 10/23/2018 Michael Wykrent $100,000 11/6/2018 R. Kevin Jones
$428,868.55 12/31/2018