bdco_ex102000





  Exhiubit 10.2






 



SBA Loan
#7471228202                                                                                                                           

Application
#3313844581





 



LOAN AUTHORIZATION AND AGREEMENT (LA&A)

 



A PROPERLY SIGNED DOCUMENT IS

 



REQUIRED PRIOR
TO ANY



DISBURSEMENT

 



CAREFULLY READ THE LA&A:





This
document describes the terms and conditions of your loan. It is
your responsibility to comply with





ALL
the terms and conditions of your
loan.

 





	


SIGNING THE LA&A:


All
borrowers must sign the LA&A.

 

● Sign
your name exactly as it appears on the LA&A. If typed
incorrectly, you should sign with the correct
spelling.

● If
your middle initial appears on the signature line, sign with your
middle initial.

● If
a suffix appears on the signature line, such as Sr. or Jr., sign
with your suffix.

● Corporate
Signatories: Authorized representatives should sign the signature
page.



Your signature represents your agreement to comply with the terms
and conditions of the loan.


 







 

 


Ref
50 30




 








 





 



SBA Loan
#7471228202                                                                                                                           

Application
#3313844581





 



U.S. Small Business Administration

 


Economic
Injury Disaster Loan

 



LOAN AUTHORIZATION AND AGREEMENT

 


Date:
08.29.2020 (Effective Date)

 


On
the above date, this Administration (SBA) authorized (under Section
7(b) of the Small Business Act, as amended) a Loan (SBA Loan
#7471228202) to Lazarus Energy LLC (Borrower) of 801 TRAVIS ST STE
2100 HOUSTON Texas 77002 in the amount of one hundred and fifty
thousand and 00/100 Dollars ($150,000.00), upon the following
conditions:

 



PAYMENT

 




●

Installment payments, including principal and
interest, of $731.00 Monthly,
will begin Twelve (12)
months from the date of the
promissory Note. The balance of principal and interest will be
payable Thirty (30)
years from the date of the
promissory Note.





 



INTEREST

 




●

Interest will accrue at the rate of
3.75%
per annum and will accrue only on funds actually advanced from the
date(s) of each advance.





 



PAYMENT TERMS

 




●

Each payment will be applied first to interest
accrued to the date of receipt of each payment, and the balance, if
any, will be applied to principal.





 




●

Each
payment will be made when due even if at that time the full amount
of the Loan has not yet been advanced or the authorized amount of
the Loan has been reduced.





 



COLLATERAL

 




●

For
loan amounts of greater than $25,000, Borrower hereby grants to
SBA, the secured party hereunder, a continuing security interest in
and to any and all “Collateral” as described herein to
secure payment and performance of all debts, liabilities and
obligations of Borrower to SBA hereunder without limitation,
including but not limited to all interest, other fees and expenses
(all hereinafter called “Obligations”). The Collateral
includes the following property that Borrower now owns or shall
acquire or create immediately upon the acquisition or creation
thereof: all tangible and intangible personal property, including,
but not limited to: (a) inventory, (b) equipment, (c) instruments,
including promissory notes (d) chattel paper, including tangible
chattel paper and electronic chattel paper, (e) documents, (f)
letter of credit rights, (g) accounts, including health-care
insurance receivables and credit card receivables, (h) deposit
accounts, (i) commercial tort claims, (j) general intangibles,
including payment intangibles and software and (k) as-extracted
collateral as such terms may from time to time be defined in the
Uniform Commercial Code. The security interest Borrower grants
includes all accessions, attachments, accessories, parts, supplies
and replacements for the Collateral, all products, proceeds and
collections thereof and all records and data relating
thereto.








●

For
loan amounts of $25,000 or less, SBA is not taking a security
interest in any collateral. Page 2 of 11





 



SBA Form 1391
(5-00)                                                                                                                                                  

Ref
50 30








 








 





 



SBA Loan
#7471228202                                                                                                                           

Application
#3313844581





 



REQUIREMENTS RELATIVE TO COLLATERAL

 




●

Borrower
will not sell or transfer any collateral (except normal inventory
turnover in the ordinary course of business) described in the
"Collateral" paragraph hereof without the prior written consent of
SBA.





 



USE OF LOAN PROCEEDS

 




●

Borrower
will use all the proceeds of this Loan solely as working capital to
alleviate economic injury caused by disaster occurring in the month
of January 31, 2020 and continuing thereafter and to pay Uniform
Commercial Code (UCC) lien filing fees and a third-party UCC
handling charge of $100 which will be deducted from the Loan amount
stated above.





 



REQUIREMENTS FOR USE OF LOAN PROCEEDS AND RECEIPTS

 




●

Borrower
will obtain and itemize receipts (paid receipts, paid invoices or
cancelled checks) and contracts for all Loan funds spent and retain
these receipts for 3 years from the date of the final disbursement.
Prior to each subsequent disbursement (if any) and whenever
requested by SBA, Borrower will submit to SBA such






itemization
together with copies of the receipts.

 




●

Borrower
will not use, directly or indirectly, any portion of the proceeds
of this Loan to relocate without the prior written permission of
SBA. The law prohibits the use of any portion of the proceeds of
this Loan for voluntary relocation from the business area in which
the disaster occurred. To request SBA's prior written permission to
relocate, Borrower will present to SBA the reasons therefore and a
description or address of the relocation site. Determinations of
(1) whether a relocation is voluntary or otherwise, and (2) whether
any site other than the disaster-affected location is within the
business area in which the disaster occurred, will be made solely
by SBA.





 




●

Borrower
will, to the extent feasible, purchase only American-made equipment
and products with the proceeds of this Loan.





 




●

Borrower will make any request for a loan increase
for additional disaster-related damages as soon as possible after
the need for a loan increase is discovered. The SBA will not
consider a request for a loan increase received more than
two (2)
years from the date of loan approval
unless, in the sole discretion of the SBA, there are extraordinary
and unforeseeable circumstances beyond the control of the
borrower.





 



DEADLINE FOR RETURN OF LOAN CLOSING DOCUMENTS

 




●

Borrower will sign and return
the loan closing documents to SBA within 2 months of the date of
this Loan Authorization and Agreement. By notifying the Borrower in writing, SBA may
cancel this Loan if the Borrower fails to meet this requirement.
The Borrower may submit and the SBA may, in its sole discretion,
accept documents after 2 months of the date of this Loan
Authorization and Agreement.





 



COMPENSATION FROM OTHER SOURCES

 




●

Eligibility
for this disaster Loan is limited to disaster losses that are not
compensated by other sources. Other sources include but are not
limited to: (1) proceeds of policies of insurance or other
indemnifications, (2) grants or other reimbursement (including
loans) from government agencies or private organizations,
(3)





 



Page 3 of 11

 



SBA Form 1391
(5-00)                                                                                                                                                  

Ref
50 30








 








 





 



SBA Loan
#7471228202                                                                                                                           

Application
#3313844581





 


claims
for civil liability against other individuals, organizations or
governmental entities, and (4) salvage (including any sale or
re-use) of items of damaged property.

 




●

Borrower
will promptly notify SBA of the existence and status of any claim
or application for such other compensation, and of the receipt of
any such compensation, and Borrower will promptly submit the
proceeds of same (not exceeding the outstanding balance of this
Loan) to SBA.





 




●

Borrower
hereby assigns to SBA the proceeds of any such compensation from
other sources and authorizes the payor of same to deliver said
proceeds to SBA at such time and place as SBA shall
designate.





 




●

SBA
will in its sole discretion determine whether any such compensation
from other sources is a duplication of benefits. SBA will use the
proceeds of any such duplication to reduce the outstanding balance
of this Loan, and Borrower agrees that such proceeds will not be
applied in lieu of scheduled payments.





 



DUTY TO MAINTAIN HAZARD INSURANCE

 




●

Within 12 months from the date of this Loan
Authorization and Agreement the Borrower will provide proof of an
active and in effect hazard insurance policy including fire,
lightning, and extended coverage on all items used to secure this
loan to at least 80% of the insurable value. Borrower will not
cancel such coverage and will maintain such coverage throughout the
entire term of this Loan. BORROWER MAY NOT BE ELIGIBLE
FOR EITHER ANY FUTURE DISASTER ASSISTANCE OR SBA FINANCIAL
ASSISTANCE IF THIS INSURANCE IS NOT MAINTAINED AS STIPULATED HEREIN
THROUGHOUT THE ENTIRE TERM OF THIS LOAN. Please submit proof of insurance to: U.S. Small
Business Administration, Office of Disaster Assistance, 14925
Kingsport Rd, Fort Worth, TX. 76155.





 



BOOKS AND RECORDS

 




●

Borrower
will maintain current and proper books of account in a manner
satisfactory to SBA for the most recent






5
years until 3 years after the date of maturity, including
extensions, or the date this Loan is paid in full, whichever occurs
first. Such books will include Borrower's financial and operating
statements, insurance policies, tax returns and related filings,
records of earnings distributed and dividends paid and records of
compensation to officers, directors, holders of 10% or more of
Borrower's capital stock, members, partners and
proprietors.

 




●

Borrower
authorizes SBA to make or cause to be made, at Borrower's expense
and in such a manner and at such times as SBA may require: (1)
inspections and audits of any books, records and paper in the
custody or control of Borrower or others relating to Borrower's
financial or business conditions, including the making of copies
thereof and extracts therefrom, and (2) inspections and appraisals
of any of Borrower's assets.





 




●

Borrower
will furnish to SBA, not later than 3 months following the
expiration of Borrower's fiscal year and in such form as SBA may
require, Borrower's financial statements.





 




●

Upon
written request of SBA, Borrower will accompany such statements
with an 'Accountant's Review Report' prepared by an independent
public accountant at Borrower's expense.





 




●

Borrower
authorizes all Federal, State and municipal authorities to furnish
reports of examination, records and other information relating to
the conditions and affairs of Borrower and any desired information
from such reports, returns, files, and records of such authorities
upon request of SBA.





 



Page 4 of 11

 



SBA Form 1391
(5-00)                                                                                                                                                  

Ref
50 30








 








 





 



SBA Loan
#7471228202                                                                                                                           

Application
#3313844581





 



LIMITS ON DISTRIBUTION OF ASSETS

 




●

Borrower will not, without the prior written
consent of SBA, make any distribution of
Borrower’s
assets, or give any preferential treatment, make any advance,
directly or indirectly, by way of loan, gift, bonus, or otherwise,
to any owner or partner or any of its employees, or to any company
directly or indirectly controlling or affiliated with or controlled
by Borrower, or any other company.





 



EQUAL OPPORTUNITY REQUIREMENT

 




●

If
Borrower has or intends to have employees, Borrower will post SBA
Form 722, Equal Opportunity Poster (copy attached), in Borrower's
place of business where it will be clearly visible to employees,
applicants for employment, and the general public.





 



DISCLOSURE OF LOBBYING ACTIVITIES

 




●

Borrower
agrees to the attached Certification Regarding Lobbying
Activities





 


BORROWER’S
CERTIFICATIONS

 


Borrower
certifies that:

 




●

There
has been no substantial adverse change in Borrower's financial
condition (and organization, in case of a business borrower) since
the date of the application for this Loan. (Adverse changes
include, but are not limited to: judgment liens, tax liens,
mechanic's liens, bankruptcy, financial reverses, arrest or
conviction of felony, etc.)





 




●

No
fees have been paid, directly or indirectly, to any representative
(attorney, accountant, etc.) for services provided or to be
provided in connection with applying for or closing this Loan,
other than those reported on SBA Form 5 Business Disaster Loan
Application'; SBA Form 3501 COVID-19 Economic Injury Disaster Loan
Application; or SBA Form 159, 'Compensation Agreement'. All fees
not approved by SBA are prohibited.





 




●

All
representations in the Borrower's Loan application (including all
supplementary submissions) are true, correct and complete and are
offered to induce SBA to make this Loan.





 




●

No
claim or application for any other compensation for disaster losses
has been submitted to or requested of any source, and no such other
compensation has been received, other than that which Borrower has
fully disclosed to SBA.





 




●

Neither
the Borrower nor, if the Borrower is a business, any principal who
owns at least 50% of the Borrower, is delinquent more than 60 days
under the terms of any: (a) administrative order; (b) court order;
or (c) repayment agreement that requires payment of child
support.





 




●

Borrower
certifies that no fees have been paid, directly or indirectly, to
any representative (attorney, accountant, etc.) for services
provided or to be provided in connection with applying for or
closing this Loan, other than those reported on the Loan
Application. All fees not approved by SBA are prohibited. If an
Applicant chooses to employ an Agent, the compensation an Agent
charges to and that is paid by the Applicant must bear a necessary
and reasonable relationship to the services actually performed and
must be comparable to those charged by other Agents in the
geographical area. Compensation cannot be contingent on loan
approval. In addition, compensation must not include any expenses
which are deemed by SBA to be unreasonable for services actually
performed or expenses actually incurred. Compensation must not
include





 



Page 5 of 11

 



SBA Form 1391
(5-00)                                                                                                                                                  

Ref
50 30








 








 





 



SBA Loan
#7471228202                                                                                                                           

Application
#3313844581





 


charges prohibited in 13 CFR 103 or SOP 50-30,
Appendix 1. If the compensation exceeds
$500 for a disaster home loan or $2,500 for a disaster business
loan, Borrower must fill out the Compensation Agreement Form 159D
which will be provided for Borrower upon request or can be found on
the SBA website.

 




●

Borrower
certifies, to the best of its, his or her knowledge and belief,
that the certifications and representations in the attached
Certification Regarding Lobbying are true, correct and complete and
are offered to induce SBA to make this Loan.





 



CIVIL AND CRIMINAL PENALTIES

 




●

Whoever
wrongfully misapplies the proceeds of an SBA disaster loan shall be
civilly liable to the Administrator in an amount equal to
one-and-one half times the original principal amount of the loan
under 15 U.S.C. 636(b). In addition, any false statement or
misrepresentation to SBA may result in criminal, civil or
administrative sanctions including, but not limited to: 1) fines,
imprisonment or both, under 15 U.S.C. 645, 18 U.S.C. 1001, 18
U.S.C. 1014, 18 U.S.C. 1040, 18 U.S.C. 3571, and any other
applicable laws; 2) treble damages and civil penalties under the
False Claims Act, 31 U.S.C. 3729; 3) double damages and civil
penalties under the Program Fraud Civil Remedies Act, 31 U.S.C.
3802; and 4) suspension and/or debarment from all Federal
procurement and non-procurement transactions. Statutory fines may
increase if amended by the Federal Civil Penalties Inflation
Adjustment Act Improvements Act of 2015.





 



RESULT OF VIOLATION OF THIS LOAN AUTHORIZATION AND
AGREEMENT

 




●

If
Borrower violates any of the terms or conditions of this Loan
Authorization and Agreement, the Loan will be in default and SBA
may declare all or any part of the indebtedness immediately due and
payable. SBA's failure to exercise its rights under this paragraph
will not constitute a waiver.





 




●

A
default (or any violation of any of the terms and conditions) of
any SBA Loan(s) to Borrower and/or its affiliates will be
considered a default of all such Loan(s).





 



DISBURSEMENT OF THE LOAN

 




●

Disbursements
will be made by and at the discretion of SBA Counsel, in accordance
with this Loan Authorization and Agreement and the general
requirements of SBA.





 




●

Disbursements
may be made in increments as needed.





 




●

Other
conditions may be imposed by SBA pursuant to general requirements
of SBA.





 




●

Disbursement
may be withheld if, in SBA's sole discretion, there has been an
adverse change in Borrower's financial condition or in any other
material fact represented in the Loan application, or if Borrower
fails to meet any of the terms or conditions of this Loan
Authorization and Agreement.





 




●


NO DISBURSEMENT WILL BE MADE LATER THAN 6 MONTHS FROM THE DATE OF
THIS LOAN AUTHORIZATION AND AGREEMENT UNLESS SBA, IN ITS SOLE
DISCRETION, EXTENDS THIS DISBURSEMENT PERIOD.





 



Page 6 of 11

 



SBA Form 1391
(5-00)                                                                                                                                                  

Ref
50 30








 








 





 



SBA Loan
#7471228202                                                                                                                           

Application
#3313844581





 



PARTIES AFFECTED

 




●

This
Loan Authorization and Agreement will be binding upon Borrower and
Borrower's successors and assigns and will inure to the benefit of
SBA and its successors and assigns.





 



RESOLUTION OF BOARD OF DIRECTORS

 




●

Borrower
shall, within 180 days of receiving any disbursement of this Loan,
submit the appropriate SBA Certificate and/or Resolution to the
U.S. Small Business Administration, Office of Disaster Assistance,
14925 Kingsport Rd, Fort Worth, TX. 76155.





 



ENFORCEABILITY

 




●

This
Loan Authorization and Agreement is legally binding, enforceable
and approved upon Borrower’s signature, the SBA’s
approval and the Loan Proceeds being issued to Borrower by a
government issued check or by electronic debit of the Loan Proceeds
to Borrower’ banking account provided by Borrower in
application for this Loan.





 

 




 

 


James
E. Rivera

 



Associate Administrator


U.S.
Small Business Administration

 


The undersigned agree(s) to be bound by the terms
and conditions herein during the term of this Loan, and further
agree(s) that no provision stated herein will be waived without
prior written consent of SBA. Under penalty of perjury of the
United States of America, I hereby certify that I am authorized to
apply for and obtain a disaster loan on behalf of Borrower, in
connection with the effects of the COVID-19
emergency.

 



Lazarus Energy LLC

 




 

 


Date:
08.29.2020

 


Jonathan
Carroll, Owner/Officer

 


Note:
Corporate Borrowers must execute Loan
Authorization and Agreement in corporate name, by a duly authorized
officer. Partnership Borrowers must execute in firm name, together
with signature of a general partner. Limited Liability entities
must execute in the entity name by the signature of the authorized
managing person.

 



Page 7 of 11

 



SBA Form 1391
(5-00)                                                                                                                                                   

Ref
50 30








 








 





 



SBA Loan
#7471228202                                                                                                                           

Application
#3313844581





 



CERTIFICATION REGARDING LOBBYING

 


For
loans over $150,000, Congress requires recipients to agree to the
following:

 




1.

Appropriated
funds may NOT be used for lobbying.





 




2.

Payment
of non-federal funds for lobbying must be reported on Form
SF-LLL.





 




3.

Language
of this certification must be incorporated into all contracts and
subcontracts exceeding $100,000.





 




4.

All
contractors and subcontractors with contracts exceeding $100,000
are required to certify and disclose accordingly.





 

 



Page 8 of 11

 


SBA
Form 1391 (5-00)




 








 





 



SBA Loan
#7471228202                                                                                                                           

Application
#3313844581





 



CERTIFICATION REGARDING

 



LOBBYING

 



Certification for Contracts, Grants, Loans, and
Cooperative



Agreements

 


Borrower
and all Guarantors (if any) certify, to the best of its, his or her
knowledge and belief, that:

 

(1) No
Federal appropriated funds have been paid or will be paid, by or on
behalf of the undersigned, to any person for influencing or
attempting to influence an officer or employee of any agency, a
Member of Congress, an officer or employee of Congress, or an
employee of a Member of Congress in connection with awarding of any
Federal contract, the making of any Federal grant, the making of
any Federal loan, the entering into of any cooperative agreement,
and the extension, continuation, renewal, or modification of any
Federal contract, grant, loan, or cooperative
agreement.

 

(2) If
any funds other than Federal appropriated funds have been paid or
will be paid to any person for influencing or attempting to
influence an officer or employee of any agency, a Member of
Congress, an officer or employee of Congress, or an employee of a
Member of Congress in connection with this Federal loan, the
undersigned shall complete and submit Standard Form LLL,
"Disclosure Form to Report Lobbying," in accordance with its
instructions.

 

(3) The
undersigned shall require that the language of this certification
be included in the award documents for all sub-awards at all tiers
(including subcontracts, sub-grants, and contracts under grants,
loans, and co-operative agreements) and that all sub-recipients
shall certify and disclose accordingly.

 


This
certification is a material representation of fact upon which
reliance was placed when this transaction was made or entered into.
Submission of this certification is a prerequisite for making or
entering into this transaction imposed by Section 1352, Title 31,
U.S. Code. Any person who fails to file the required certification
shall be subject to a civil penalty of not less than $10,000.00 and
not more than $100,000.00 for each such failure.

 

 



Page 9 of 11

 


SBA
Form 1391 (5-00)




 








 






 

 


	



 

	

This
Statement of Policy is Posted


In
Accordance with Regulations of the



Small Business Administration







 

 

 



This Organization Practices

 



Equal Employment Opportunity

 



We do not discriminate on the ground of race, color, religion, sex,
age, disability



or national origin in the hiring, retention, or promotion of
employees; nor in determining their rank, or the compensation or
fringe benefits paid them.

 



This Organization Practices

 



Equal Treatment of Clients

 



We do not discriminate on the basis of race, color, religion, sex,
marital status,

 



disability, age or national origin in services or accommodations
offered or

 



provided to our employees, clients or guests.

 



These policies and this notice comply with regulations of
the

 



United States Government.

 



Please report violations of this policy to:

 



Administrator

 



Small Business Administration



Washington, D.C. 20416

 


In
order for the public and your employees to know their rights under
13 C.F.R Parts 112, 113, and 117, Small Business Administration
Regulations, and to conform with the directions of the
Administrator of SBA, this poster must be displayed where it is
clearly visible to employees, applicants for employment, and the
public.

 


Failure
to display the poster as required in accordance with SBA
Regulations may be considered evidence of noncompliance and subject
you to the penalties contained in those Regulations.

 

 



Page 10 of 11



SBA FORM 722 (10-02) REF: SOP 9030 PREVIOUS
EDITIONS ARE
OBSOLETE                                                                                                                         

U.S. GOVERNMENT PRINTING
OFFICE: 1994 0- 153-346 This
form was electronically produced by Elite Federal
Inc.





 







 








 






 

 


	



 

	


Esta Declaración De Principios Se Publica



De Acuerdo Con Los Reglamentos De La


Agencia
Federal Para el Desarrollo de la Pequeña Empresa


 







 

 

 



Esta Organización Practica

 



Igual Oportunidad De Empleo

 



No discriminamos por razón de raza, color, religión,
sexo, edad, discapacidad o

 



nacionalidad en el empleo, retención o ascenso de personal ni
en la determinación

 



de sus posiciones, salarios o beneficios marginales.

 



Esta Organización Practica

 



Igualdad En El Trato A Su Clientela

 



No discriminamos por razón de raza, color, religión,
sexo, estado civil,



edad, discapacidad o nacionalidad en los servicios o facilidades
provistos para



nuestros empleados, clientes o visitantes.

 



Estos principios y este aviso cumplen con los reglamentos del
Gobierno de los Estados Unidos de America.

 



Favor de informar violaciones a lo aquí indicado
a:

 



Administrador

 



Agencia Federal Para el Desarrollo de la

 



Pequeña Empresa

 



Washington, D.C. 20416

 



A fin de que el público y sus empleados conozcan sus derechos
según lo expresado en las Secciones 112, 113 y 117 del
Código de Regulaciaones Federales No. 13, de los Reglamentos
de la Agencja Federal Para el Desarrollo de la Pequeña Empresa
y de acuerdo con las instrucciones del Administrador de dicha
agencia,



esta notificación debe fijarse en un lugar claramente visible
para los empleados, solicitantes de empleo y público en
general. No fijar esta notificación según lo requerido
por los reglamentos de la Agencia Federal Para el Desarrollo de la
Pequeña Empresa, puede ser interpretado como evidencia de
falta de cumplimiento de los mismos y conllevará la
ejecución de los castigos impuestos en estos
reglamentos.

 

 



Page 11 of 11



SBA FORM 722 (10-02) REF: SOP 9030 PREVIOUS
EDITIONS ARE
OBSOLETE                                                                                                                         

U.S. GOVERNMENT PRINTING
OFFICE: 1994 0- 153-346 This
form was electronically produced by Elite Federal
Inc.





 







 








 





 



SBA Loan
#7471228202                                                                                                                           

Application
#3313844581





 



NOTE

 



A PROPERLY SIGNED NOTE IS

 

 



REQUIRED PRIOR
TO ANY

 

 



DISBURSEMENT

 


	


CAREFULLY READ THE NOTE: It is your promise to repay the
loan.

 

● The
Note is pre-dated. DO NOT CHANGE THE DATE OF THE
NOTE.

● LOAN
PAYMENTS will be due as stated
in the Note.

 

● ANY
CORRECTIONS OR UNAUTHORIZED MARKS MAY VOID THIS
DOCUMENT.

 


 







 

 

 


SIGNING
THE NOTE: All borrowers must sign the
Note.

 




●

Sign your name exactly
as it appears on the Note. If typed
incorrectly, you should sign with the correct
spelling.








●

If
your middle initial appears on the signature line, sign with your
middle initial.








●

If
a suffix appears on the signature line, such as Sr. or Jr., sign
with your suffix.








●

Corporate
Signatories: Authorized representatives should sign the signature
page.








 








 





 



SBA Loan
#7471228202                                                                                                                           

Application
#3313844581





 


	


	


U.S. Small Business Administration



NOTE



(SECURED DISASTER
LOANS)


 

	


Date: 08.29.2020



Loan Amount: $150,000.00



Annual Interest Rate: 3.75%


 


	
 

	
 







 

 

 




SBA Loan #
7471228202                                                                                                                       


Application #3313844581





 





1.

PROMISE TO PAY:
In return for a loan, Borrower
promises to pay to the order of SBA the amount of
one hundred and
fifty thousand and
00/100 Dollars ($150,000.00),
interest on the unpaid principal balance, and all other amounts
required by this Note.





 





2.

DEFINITIONS: A)
“Collateral” means any property taken as security for payment
of this Note or any guarantee of this Note. B) “Guarantor” means each person or entity that signs a guarantee
of payment of this Note. C) “Loan Documents” means the documents related to this loan signed by
Borrower, any Guarantor, or anyone who pledges
collateral.





 





3.

PAYMENT TERMS:
Borrower must make all payments at the
place SBA designates. Borrower may prepay this Note in part or in
full at any time, without notice or penalty. Borrower must pay
principal and interest payments of $731.00
every month
beginning Twelve
(12) months from the date of
the Note. SBA will apply each installment payment first to pay
interest accrued to the day SBA receives the payment and will then
apply any remaining balance to reduce principal. All remaining
principal and accrued interest is due and payable
Thirty
(30) years from the date of the
Note.





 





4.

DEFAULT: Borrower is in default under this Note if Borrower
does not make a payment when due under this Note, or if
Borrower: A) Fails to comply with any provision of this Note,
the Loan Authorization and Agreement, or other Loan
Documents; B) Defaults on any other SBA loan;
C)
Sells or otherwise transfers, or does
not preserve or account to SBA’s satisfaction for, any of the Collateral or its
proceeds; D) Does not disclose, or anyone acting on their
behalf does not disclose, any material fact to SBA;
E)
Makes, or anyone acting on their
behalf makes, a materially false or misleading representation to
SBA; F) Defaults on any loan or agreement with another
creditor, if SBA believes the default may materially affect
Borrower’s ability to pay this Note; G) Fails to pay any taxes when due;
H)
Becomes the subject of a proceeding
under any bankruptcy or insolvency law; I) Has a receiver or liquidator appointed for any
part of their business or property; J) Makes an assignment for the benefit of
creditors; K) Has any adverse change in financial condition or
business operation that SBA believes may materially affect
Borrower’s ability to pay this Note; L) Dies; M) Reorganizes, merges, consolidates, or otherwise
changes ownership or business structure without
SBA’s prior written consent; or, N) Becomes the subject of a civil or criminal action
that SBA believes may materially affect Borrower’s ability to pay this Note.





 





5.

SBA’S
RIGHTS IF THERE IS A DEFAULT: Without notice or demand and without giving up any
of its rights, SBA may: A) Require immediate payment of all amounts owing
under this Note; B) Have recourse to collect all amounts owing from
any Borrower or Guarantor (if any); C) File suit and obtain judgment; D) Take possession of any Collateral; or
E)
Sell, lease, or otherwise dispose of,
any Collateral at public or private sale, with or without
advertisement.





 





6.

SBA’S
GENERAL POWERS: Without notice
and without Borrower’s consent, SBA may: A) Bid on or buy the Collateral at its sale or the
sale of another lienholder, at any price it chooses;
B)
Collect amounts due under this Note,
enforce the terms of this Note or any other Loan Document, and
preserve or dispose of the Collateral. Among other things, the
expenses may include payments for property taxes, prior liens,
insurance, appraisals, environmental remediation costs, and
reasonable attorney’s fees and costs. If SBA incurs such expenses, it
may demand immediate reimbursement from Borrower or add the
expenses to the principal balance; C) Release anyone obligated to pay this Note;
D)
Compromise, release, renew, extend or
substitute any of the Collateral; and E) Take any action necessary to protect the
Collateral or collect amounts owing on this
Note.





 



Page 2 of 3

 


SBA
FORM 147 B (5-00)




 








 





 



SBA Loan
#7471228202                                                                                                                           

Application
#3313844581





 





7.

FEDERAL LAW APPLIES:
When SBA is the holder, this Note will
be interpreted and enforced under federal law, including SBA
regulations. SBA may use state or local procedures for filing
papers, recording documents, giving notice, foreclosing liens, and
other purposes. By using such procedures, SBA does not waive any
federal immunity from state or local control, penalty, tax, or
liability. As to this Note, Borrower may not claim or assert
against SBA any local or state law to deny any obligation, defeat
any claim of SBA, or preempt federal law.





 





8.

GENERAL PROVISIONS: A)
All individuals and entities signing
this Note are jointly and severally liable. B) Borrower waives all suretyship defenses.
C)
Borrower must sign all documents
required at any time to comply with the Loan Documents and to
enable SBA to acquire, perfect, or maintain SBA’s liens on Collateral. D) SBA may exercise any of its rights separately or
together, as many times and in any order it chooses. SBA may delay
or forgo enforcing any of its rights without giving up any of
them. E) Borrower may not use an oral statement of SBA to
contradict or alter the written terms of this Note.
F)
If any part of this Note is
unenforceable, all other parts remain in effect.
G)
To the extent allowed by law, Borrower
waives all demands and notices in connection with this Note,
including presentment, demand, protest, and notice of dishonor.
Borrower also waives any defenses based upon any claim that SBA did
not obtain any guarantee; did not obtain, perfect, or maintain a
lien upon Collateral; impaired Collateral; or did not obtain the
fair market value of Collateral at a sale. H) SBA may sell or otherwise transfer this
Note.





 





9.

MISUSE OF LOAN FUNDS:
Anyone who wrongfully misapplies any
proceeds of the loan will be civilly liable to SBA for one and one-
half times the proceeds disbursed, in addition to other remedies
allowed by law.





 





10.

BORROWER’S
NAME(S) AND SIGNATURE(S): By
signing below, each individual or entity acknowledges and accepts
personal obligation and full liability under the Note as
Borrower.





 



Lazarus Energy LLC

 




 

 


Jonathan
Carroll, Owner/Officer

 

 



Page 3 of 3

 


SBA
FORM 147 B (5-00)




 








 





 



SBA Loan
#7471228202                                                                                                                           

Application
#3313844581





 



SECURITY AGREEMENT

 


Read this document
carefully. It grants the SBA a
security interest (lien) in all the property described in paragraph
4.

 


This
document is predated. DO NOT CHANGE THE DATE ON THIS
DOCUMENT.




 








 





 



SBA Loan
#7471228202                                                                                                                           

Application
#3313844581





 

 


 


	



 

	


U.S. Small Business Administration



SECURITY
AGREEMENT


 







 

 

 


 


	

SBA
Loan #:


 

	

7471228202


 


	

Borrower:


 

	

Lazarus
Energy LLC


 


	

Secured
Party:


 

	


The Small Business Administration, an Agency of the U.S.
Government


 


	

Date:


 

	

08.29.2020


 


	

Note
Amount:


 

	

$150,000.00


 







 

 

 


1. DEFINITIONS.

 


Unless
otherwise specified, all terms used in this Agreement will have the
meanings ascribed to them under the

 


Official Text of the Uniform Commercial Code, as
it may be amended from time to time, (“UCC”).
“SBA” means the Small Business Administration, an Agency
of the U.S. Government.

 


2. GRANT
OF SECURITY INTEREST.

 


For value received, the Borrower grants to the
Secured Party a security interest in the property described below
in paragraph 4 (the “Collateral”).

 


3. OBLIGATIONS
SECURED.

 


This Agreement secures the payment and performance
of: (a) all obligations under a Note dated 08.29.2020, made by
Lazarus Energy LLC , made payable to Secured Lender, in the amount
of $150,000.00 (“Note”), including all costs and expenses (including
reasonable attorney’s fees), incurred by Secured Party in the
disbursement, administration and collection of the loan evidenced
by the Note; (b) all costs and expenses (including reasonable
attorney’s fees), incurred by Secured Party in the
protection, maintenance and enforcement of the security interest
hereby granted; (c) all obligations of the Borrower in any other
agreement relating to the Note; and (d) any modifications,
renewals, refinancings, or extensions of the foregoing
obligations.

 


4. COLLATERAL
DESCRIPTION.

 


The
Collateral in which this security interest is granted includes the
following property that Borrower now owns or shall acquire or
create immediately upon the acquisition or creation thereof: all
tangible

 



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Form 1059 (09-19) Previous Editions are obsolete.




 








 





 



SBA Loan
#7471228202                                                                                                                           

Application
#3313844581





 


and
intangible personal property, including, but not limited to: (a)
inventory, (b) equipment, (c) instruments, including promissory
notes (d) chattel paper, including tangible chattel paper and
electronic chattel paper, (e) documents, (f) letter of credit
rights, (g) accounts, including health-care insurance receivables
and credit card receivables, (h) deposit accounts, (i) commercial
tort claims, (j) general intangibles, including payment intangibles
and software and (k) as-extracted collateral as such terms may from
time to time be defined in the Uniform Commercial Code. The
security interest Borrower grants includes all accessions,
attachments, accessories, parts, supplies and replacements for the
Collateral, all products, proceeds and collections thereof and all
records and data relating thereto.

 





5.


RESTRICTIONS ON COLLATERAL TRANSFER.





 


Borrower
will not sell, lease, license or otherwise transfer (including by
granting security interests, liens, or other encumbrances in) all
or any part of the Collateral or Borrower’s interest in the
Collateral without Secured Party’s written or electronically
communicated approval, except that Borrower may sell inventory in
the ordinary course of business on customary terms. Borrower may
collect and use amounts due on accounts and other rights to payment
arising or created in the ordinary course of business, until
notified otherwise by Secured Party in writing or by electronic
communication.

 





6.


MAINTENANCE AND LOCATION OF COLLATERAL; INSPECTION;
INSURANCE.





 


Borrower
must promptly notify Secured Party by written or electronic
communication of any change in location of the Collateral,
specifying the new location. Borrower hereby grants to Secured
Party the right to inspect the Collateral at all reasonable times
and upon reasonable notice. Borrower must: (a) maintain the
Collateral in good condition; (b) pay promptly all taxes,
judgments, or charges of any kind levied or assessed thereon; (c)
keep current all rent or mortgage payments due, if any, on premises
where the Collateral is located; and (d) maintain hazard insurance
on the Collateral, with an insurance company and in an amount
approved by Secured Party (but in no event less than the
replacement cost of that Collateral), and including such terms as
Secured Party may require including a Lender’s Loss Payable
Clause in favor of Secured Party. Borrower hereby assigns to
Secured Party any proceeds of such policies and all unearned
premiums thereon and authorizes and empowers Secured Party to
collect such sums and to execute and endorse in Borrower’s
name all proofs of loss, drafts, checks and any other documents
necessary for Secured Party to obtain such payments.

 





7.


CHANGES TO BORROWER’S LEGAL STRUCTURE, PLACE OF BUSINESS, JURISDICTION
OF ORGANIZATION, OR NAME.





 


Borrower
must notify Secured Party by written or electronic communication
not less than 30 days before taking any of the following actions:
(a) changing or reorganizing the type of organization or form under
which it does business; (b) moving, changing its place of business
or adding a place of business; (c) changing its jurisdiction of
organization; or (d) changing its name. Borrower will pay for the
preparation and filing of all documents Secured Party deems
necessary to maintain, perfect and continue the perfection of
Secured Party’s security interest in the event of any such
change.

 





8.


PERFECTION OF SECURITY INTEREST.





 


Borrower
consents, without further notice, to Secured Party’s filing
or recording of any documents necessary to perfect, continue, amend
or terminate its security interest. Upon request of Secured Party,
Borrower must sign or otherwise authenticate all documents that
Secured Party deems necessary at any time to allow Secured Party to
acquire, perfect, continue or amend its security interest in the
Collateral. Borrower will pay the filing and recording costs of any
documents relating to Secured Party’s security interest.
Borrower ratifies all previous filings and recordings, including
financing statements and

 



Page 3 of 5

 


SBA
Form 1059 (09-19) Previous Editions are obsolete.




 








 





 



SBA Loan
#7471228202                                                                                                                           

Application
#3313844581





 


notations
on certificates of title. Borrower will cooperate with Secured
Party in obtaining a Control Agreement satisfactory to Secured
Party with respect to any Deposit Accounts or Investment Property,
or in otherwise obtaining control or possession of that or any
other Collateral.

 


9. DEFAULT.

 


Borrower is in default under this Agreement if:
(a) Borrower fails to pay, perform or otherwise comply with any
provision of this Agreement; (b) Borrower makes any materially
false representation, warranty or certification in, or in
connection with, this Agreement, the Note, or any other agreement
related to the Note or this Agreement; (c) another secured party or
judgment creditor exercises its rights against the Collateral; or
(d) an event defined as a “default” under the Obligations occurs. In the event of
default and if Secured Party requests, Borrower must assemble and
make available all Collateral at a place and time designated by
Secured Party. Upon default and at any time thereafter, Secured
Party may declare all Obligations secured hereby immediately due
and payable, and, in its sole discretion, may proceed to enforce
payment of same and exercise any of the rights and remedies
available to a secured party by law including those available to it
under Article 9 of the UCC that is in effect in the jurisdiction
where Borrower or the Collateral is located. Unless otherwise
required under applicable law, Secured Party has no obligation to
clean or otherwise prepare the Collateral for sale or other
disposition and Borrower waives any right it may have to require
Secured Party to enforce the security interest or payment or
performance of the Obligations against any other
person.

 


10. FEDERAL
RIGHTS.

 


When
SBA is the holder of the Note, this Agreement will be construed and
enforced under federal law,


including
SBA regulations. Secured Party or SBA may use state or local
procedures for filing papers, recording documents, giving notice,
enforcing security interests or liens, and for any other purposes.
By using such procedures, SBA does not waive any federal immunity
from state or local control, penalty, tax or liability. As to this
Agreement, Borrower may not claim or assert any local or state law
against SBA to deny any obligation, defeat any claim of SBA, or
preempt federal law.

 


11. GOVERNING
LAW.

 


Unless
SBA is the holder of the Note, in which case federal law will
govern, Borrower and Secured Party agree that this Agreement will
be governed by the laws of the jurisdiction where the Borrower is
located, including the UCC as in effect in such jurisdiction and
without reference to its conflicts of laws principles.

 


12. SECURED
PARTY RIGHTS.

 


All rights conferred in this Agreement on Secured
Party are in addition to those granted to it by law, and all rights
are cumulative and may be exercised simultaneously. Failure of
Secured Party to enforce any rights or remedies will not constitute
an estoppel or waiver of Secured Party’s ability to exercise such rights or remedies.
Unless otherwise required under applicable law, Secured Party is
not liable for any loss or damage to Collateral in its possession
or under its control, nor will such loss or damage reduce or
discharge the Obligations that are due, even if Secured
Party’s actions or inactions caused or in any way
contributed to such loss or damage.

 


13. SEVERABILITY.

 


If
any provision of this Agreement is unenforceable, all other
provisions remain in effect.

 



Page 4 of 5

 


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Form 1059 (09-19) Previous Editions are obsolete.




 








 





 



SBA Loan
#7471228202                                                                                                                           

Application
#3313844581





 



14.           


BORROWER CERTIFICATIONS.





 


Borrower certifies that: (a) its Name (or Names)
as stated above is correct; (b) all Collateral is owned or titled
in the Borrower’s name and not in the name of any other
organization or individual; (c) Borrower has the legal authority to
grant the security interest in the Collateral; (d)
Borrower’s ownership in or title to the Collateral is free
of all adverse claims, liens, or security interests (unless
expressly permitted by Secured Party); (e) none of the Obligations
are or will be primarily for personal, family or household
purposes; (f) none of the Collateral is or will be used, or has
been or will be bought primarily for personal, family or household
purposes; (g) Borrower has read and understands the meaning and
effect of all terms of this Agreement.

 


15. BORROWER
NAME(S) AND SIGNATURE(S).

 


By
signing or otherwise authenticating below, each individual and each
organization becomes jointly and severally obligated as a Borrower
under this Agreement.

 



Lazarus Energy LLC

 


	






	


Date:

	

08.29.2020


 


	

Jonathan
Carroll, Owner/Officer

	
 

	
 







 

 

 



Page 5 of 5

 


SBA
Form 1059 (09-19) Previous Editions are obsolete.