Exhibit
10.40


 


SECURED
PROMISSORY NOTE


 


	$1,000,000	May
    18, 2022 (the “Effective Date”)


 


FOR
VALUE RECEIVED, the undersigned, BioLife4D – SM Trust, dated November 1, 2016, a trust organized under the laws of the State of
Illinois (“Borrower”), promises to pay to the order of Gary


E.
Reynolds, an individual residing in the State of Texas (“Lender”), at 8713 Airport Freeway, Suite 100, North Richland
Hills, TX 76180, or at such other place as Lender may designate, the principal sum of one million dollars ($1,000,000), together with
interest accrued thereon, all as provided in this Secured Promissory Note (this “Note”).


 


1.
Definitions. For the purposes of this Note, unless the context requires otherwise, the following terms have the respective meanings
given to them in this Section or in the Sections referred to below:


 


“Bank”
means Fifth Third Bank National Association and any successor thereto.


 


“Bank
Cash Collateral” has the meaning given to that term in Section 2.


 


“Bank
Loan” has the meaning given to that term in Section 2.


 


“Business
Day” means every day that is not a Saturday, Sunday or legal holiday in Fort


Worth,
Texas.


 


“Corporation”
means BioLife4D Corporation, a Delaware corporation, and any successor


thereto.


 


“Debtor
Relief Law” means the Bankruptcy Code of the United States of America and all other applicable liquidation, conservatorship,
bankruptcy, moratorium, rearrangement, receivership, insolvency, reorganization or similar debtor relief laws from time to time in effect
affecting the rights of creditors generally.


 


“Dollars”
and the symbol “$” refers to currency of the United States of America.


 


“Event
of Default” has the meaning given to such term in Section 9.


 


“Governmental
Authority” means any government (or any political subdivision or jurisdiction thereof), court, bureau, agency, or other governmental
authority.


 


“Lien”
means any lien, mortgage, security interest, tax lien, pledge, encumbrance, conditional sale or title retention arrangement, or any other
interest in property designed to secure the repayment of indebtedness, whether arising by agreement, under any statute or law, or otherwise.


 


“Loan
Documents” mean this Note, the Security Agreement, and any agreements or documents executed or delivered pursuant to the terms
of this Note or the Security Agreement, including any amendments, renewals, extensions, substitutions, supplements, or modifications
of any of the foregoing.


 




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“Loan
Premium” means an amount equal to $100,000 minus the total amount of interest on this Note paid by Lender at or prior to the
time such Loan Premium is paid (but in no event shall the Loan Premium be less than zero).


 


“Maturity
Date” means the date that is the earlier of: (i) the maturity date of the Bank Loan (currently May 18, 2023), but in no event
later than November 18, 2023, or (ii) 2 Business Days following the receipt by the Corporation of funds from the closing of an initial
public offering or other transaction (whether public or private) involving the Corporation’s sale, issuance, or transfer of securities
of the Corporation, or (iii) the disbursement of the Bank Cash Collateral from the Bank to Borrower or the Corporation.


 


“Note”
has the meaning given to such term in the opening paragraph of this instrument.


 


“Organizational
Documents” mean, as applicable to any Person, the Articles or Certificate of Incorporation, bylaws, shareholder agreements,
partnership agreement, limited liability company agreement, trust agreement, or any other organizational or governing documents of such
Person, in each case applicable to or binding upon such Person or any of such Person’s property or to which such Person or any
of such Person’s property is subject.


 


“Person”
includes an individual, a corporation, non-profit corporation, a professional association, a joint venture, a general partnership, a
limited partnership, a limited liability company, a limited liability partnership, a trust, an unincorporated organization or a Governmental
Authority.


 


“Regulatory
Defects” mean the failure by Borrower to comply with all laws, statutes, orders, rules and regulations of any Governmental
Authority.


 


“Requirements”
mean (i) any and all present and future judicial decisions, laws, statutes, rulings, rules, regulations, orders, permits, certificates
or ordinances of any Governmental Authority in any manner applicable to Borrower, and (ii) any and all material contracts, written or
oral, of any nature to which Borrower may be bound.


 


“Security
Agreement” has the meaning given to such term in Section 6.


 


2.
Use of Proceeds. The proceeds of this Note shall be used by Borrower solely to provide $1,000,000 cash collateral in favor of
Bank (the “Bank Cash Collateral”) to secure a $1,000,000 working capital loan by Bank to the Corporation (the “Bank
Loan”). Borrower shall provide Lender documentary evidence reasonably satisfactory to Lender that Borrower’s use of the
proceeds complies with the terms of this Section 2. At the option of Lender, Lender may transfer the proceeds of this Note directly
to Bank, pursuant to wire instructions to be provided by Borrower, to become part of the Bank Cash Collateral but such transfer shall
nevertheless be a loan to Borrower under this Note.


 


3.
Payment. Accrued but unpaid interest on the outstanding principal balance of this Note shall be due and payable in quarterly installments
on the last day of August, November, February, and May until the Maturity Date. On the Maturity Date, the outstanding principal balance
of this Note, all accrued but unpaid interest hereon, and any applicable Loan Premium shall be due and payable in full. If principal
or interest on this Note or any Loan Premium becomes due and payable on other than a Business Day, payment in respect thereof may be
made on the next succeeding Business Day, and interest shall continue to accrue during such extension.


 




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4.
Interest Rate. The principal balance of this Note from time to time remaining unpaid prior to maturity shall accrue interest beginning
as of the Effective Date at the rate of ten percent (10%) per year. Interest on any past due principal of or interest on this Note shall
bear interest from its due date until the date of its payment at the rate of fifteen percent (15%) per year. Interest on this Note shall
be calculated on the basis of actual days elapsed in a year consisting of 365 days or 366 days, as applicable.


 


5.
Prepayment. Borrower may, at its sole option, without premium or penalty (other than any applicable Loan Premium), prepay all
or any part of the principal of this Note, together with all accrued but unpaid interest thereon and any applicable Loan Premium, before
the Maturity Date. Any principal on this Note prepaid by Borrower may not be reborrowed by Borrower.


 


6.
Security Agreement. The full amount of this Note is secured by the collateral identified and described as security therefor in
a Stock Pledge Agreement of even date herewith executed and delivered by Borrower in favor of Lender (the “Security Agreement”).


 


7.
Representations and Warranties of Borrower. Borrower represents and warrants to the Lender as follows as of the Effective Date:


 


(a)
The Borrower is a trust duly created and validly existing under the laws of the State of


Illinois.


 


(b)
The execution and delivery of the Loan Documents by Borrower and the performance by


Borrower
of its obligations under the Loan Documents have been duly authorized by all necessary action on the part of Borrower.


 


(c)
The execution and delivery of the Loan Documents by Borrower and the performance by Borrower of its obligations under the Loan Documents
shall not violate or constitute a default under any Requirements or Borrower’s Organizational Documents.


 


(d)
The Loan Documents, when executed and delivered by the applicable parties thereto, shall constitute legal, valid and binding obligations
of Borrower in accordance with their respective terms subject to applicable Debtor Relief Laws and subject to general principles of equity,
regardless of whether considered in a proceeding in equity or at law.


 


(e)
Borrower does not have any agreements in effect providing for or relating to extensions of credit in respect of which Borrower is or
may become directly or contingently obligated.


 


(f)
Attached hereto as Schedule 1 is a true and correct list setting forth all of the assets, properties, and liabilities of Borrower
as of the Effective Date.


 


(g)
Borrower has good and valid title to all of its assets and properties free and clear of any Liens other than Liens granted to Lender
under the Security Agreement.


 


(h)
Borrower is not in default in any material respect under any contract, lease, loan agreement, indenture, mortgage, security agreement
or other agreement or obligation to which Borrower is a party or by which Borrower’s property is bound.


 


(i)
No Regulatory Defects exist in respect of Borrower or its assets and properties.


 


(j)
There are no suits or proceedings pending or threatened in any court or before any Governmental Authority against or affecting Borrower.


 




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(k)
There are no suits or proceedings pending or threatened in any court or before any Governmental Authority against or affecting the Corporation
other than that certain case styled Leith, Struve, Echoventure, LLC et al v. BioLife4D Corporation, Circuit Court of Cook County, Illinois,
Law Division, Case No. 2020-L-006166.


 


(l)
Borrower has delivered to Lender correct and complete copies of all of the loan documents with Bank.


 


All
representations and warranties by Borrower set forth in this Note or any other Loan Documents shall survive delivery of this Note and
the other Loan Documents. Any investigation at any time made by or on behalf of Lender shall not diminish Lender’s right to rely
on the representations and warranties made by Borrower.


 


8.
Covenants. Until the fulfillment of all of Borrower’s obligations under the Loan Documents, unless Lender otherwise consents
in writing, Borrower shall perform and comply with the following covenants:


 


(a)
Borrower shall not sell, transfer, assign, distribute, mortgage, pledge, or otherwise dispose of any of its assets or properties (or
any interest therein).


 


(b)
Borrower shall comply in all material respects with all Requirements.


 


(c)
Borrower shall not create, incur, assume or suffer to exist any Lien against any of Borrower’s assets or properties except for
the Liens granted to Lender under the Security Agreement.


 


(d)
Borrower shall not incur, assume, or suffer to exist any indebtedness for borrowed money other than trade payables incurred in the ordinary
course of business.


 


(e)
Borrower shall promptly provide Lender such information regarding the assets, properties, business, affairs, and financial condition
of Borrower as Lender may reasonably request from time to time.


 


(f)
Borrower shall promptly (but in no event later than 7 days after the occurrence thereof) notify Lender of, (i) any material adverse change
in Borrower’s financial condition, (ii) any default under any agreement, contract or other instrument to which Borrower is a party
or by which any of Borrower’s assets or properties are bound, or any acceleration of the maturity of any indebtedness, (iii) any
claim against or affecting Borrower or Borrower’s assets or property, (iv) the commencement of, and any determination in, any litigation
with any third party or any proceeding before any Governmental Authority affecting Borrower, and (v) any violations or alleged violations
by Borrower of any Requirement.


 


(g)
Borrower shall furnish to Lender immediately upon becoming aware of the existence of any condition or event which constitutes an Event
of Default, or an event which, with notice or lapse of time, would become an Event of Default, notice specifying the nature and period
of existence thereof and the action which Borrower is taking or proposes to take with respect thereto.


 


(h)
Borrower shall not terminate its existence (which includes a trust revocation), dissolve, merge, change its state of formation, change
its legal organizational structure, or undertake any similar transaction.


 




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9.
Events of Default and Remedies. The occurrence of any of the following shall constitute an “Event of Default”
hereunder:


 


(a)
the failure of Borrower to make any payment of interest or principal within 3 Business Days of the date when due hereunder;


 


(b)
if any representation, warranty, statement, or certification made by Borrower in any Loan Document proves to have been incorrect in any
material respect at the time of making or issuance thereof;


 


(c)
if Borrower defaults under, or in the observance or performance of, any of the covenants and agreements contained in any Loan Document,
subject in each case to a notice and cure period of 10 Business Days but only if such default is reasonably capable of cure; or


 


(d)
Borrower shall (i) voluntarily seek, consent to, acquiesce in the benefit or benefits of any Debtor Relief Law or (ii) become party to
(or be made the subject of) any proceeding provided by any Debtor Relief Law, other than as a creditor or claimant (unless in the event
such proceeding is involuntary, the petition instituting the same is dismissed within sixty (60) days of the filing of same.


 


Upon
the occurrence of an Event of Default and at any time thereafter during the continuance of such Event of Default, Lender may at its option,
by written notice to Borrower (a) declare the entire principal amount of this Note, together with all accrued interest thereon and all
other amounts payable under this Note, immediately due and payable, whereupon the same shall immediately become due and payable without
any present, demand, protest, notice of protest, notice of intent to accelerate, notice of acceleration, or any notice of any kind, all
of which are hereby waived to the fullest extent permitted by law) and/or (b) exercise any or all of its rights, powers, or remedies
under the Loan Documents or applicable law; provided, however that, if an Event of Default described in Section 9.4(d)
shall occur, the principal of and accrued interest on this Note shall become immediately due and payable without any notice, declaration,
or other act on the part of Lender.


 


10.
Cumulative Rights. Each right, power and remedy of Lender as provided for in this Note or the other Loan Documents or now or hereafter
existing under any applicable law will be cumulative and concurrent and will be in addition to every other right, power or remedy provided
for in this Note or the other Loan Documents or now or hereafter existing under applicable law, and the exercise or beginning of exercise
by Lender of any one or more of such rights, powers or remedies, will not preclude the simultaneous or later exercise by Lender of any
and all such other rights, powers or remedies. No delay on the part of the Lender in the exercise of any power or right under this Note
or the other Loan Documents shall operate as a waiver thereof.


 


11.
Notices. All notices, requests, consents, claims, demands, waivers and other communications hereunder shall be in writing and
shall be deemed to have been given (a) when delivered by hand (with written confirmation of receipt); (b) when received by the addressee
if sent by a nationally recognized overnight courier (receipt requested); (c) on the date sent by e-mail of a PDF document (with confirmation
of transmission) if sent during normal business hours of the recipient, and on the next business day if sent after normal business hours
of the recipient or (d) on the third (3rd) day after the date mailed, by certified or registered mail, return receipt requested, postage
prepaid. Such communications must be sent to the respective parties at the following addresses (or at such other address for a party
as shall be specified in a notice given in accordance with this Section 11):


 


If
to the Lender:


 


Gary
E. Reynolds


8713
Airport Freeway, Suite 100


North
Richland Hills, TX 76180


Email:
greynolds@reynoldsasphalt.com


 




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with
copies (which shall not constitute notice) to:


 


Bourland,
Wall &


Wenzel,
P.C.


301
Commerce Street


Suite
1500


Fort
Worth, TX 76102


Attention:
David P. Dunning


Email:
ddunning@bwwlaw.com


 


If
to Borrower:


 


BioLife4D
– SM Trust 318


Half
Day Road


Suite
201


Buffalo
Grove, IL 60089


Attention:
Steven R. Morris


Email:
smorris@biolife4d.com


 


with
copies to:


 


HMB
Legal Counsel


500
West Madison Street


Suite
3700


Chicago,
IL 60661


Attention:
Jeffrey A. Hechtman


Email:
jhechtma@hmblaw.com


 


12.
Maximum Interest. Notwithstanding anything contained in this Note or the other Loan Documents to the contrary, Borrower and Lender
intend to conform strictly to the applicable usury laws. In no event shall Lender be entitled to interest exceeding the maximum rate
permitted by law. If the Lender ever receives an amount designated as interest which would exceed the highest lawful rate, the amount
which would be excessive interest shall be applied to the reduction of the unpaid principal balance of this Note in the inverse order
of maturity, and if this Note is paid in full, any remaining excess shall be paid to Borrower. In determining whether or not the interest
paid or payable, under any specific contingency, exceeds the maximum rate of interest permitted by applicable law, Borrower and Lender
shall, to the maximum extent permitted under applicable law (a) characterize any non-principal payment as an expense, fee or premium
rather than as interest, (b) exclude voluntary prepayments and the effects thereof, and (c) “spread” the total amount of
interest throughout the entire term of this Note so that the interest rate is uniform throughout the entire term hereof.


 




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13.
Governing Law; Venue; Jurisdiction. This Note and the other Loan Documents are governed by the substantive laws of the
state of Delaware, excluding its conflicts of law provisions. Any dispute arising under, in connection with, or incident to this Note
or the other Loan Documents or about the interpretation thereof will be resolved exclusively in the state or federal courts located in
Tarrant County, Texas. Borrower irrevocably submits to those courts’ venue and jurisdiction. Borrower waives all defenses of lack
of personal jurisdiction and forum non-conveniens. A final judgment in any such suit or action may be enforced in other jurisdictions
by suit on the judgment or in any other manner provided by applicable law.


 


14.
Waiver of Jury Trial. BORROWER HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY
HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY RELATING TO THIS NOTE AND THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY WHETHER BASED ON CONTRACT, TORT, OR ANY OTHER THEORY.


 


15.
Modification. None of the terms or provisions of this Note may be excluded, waived, modified or amended except by a written instrument
duly executed on behalf of Borrower and Lender expressly referring to this Note and setting forth the provision so excluded, waived,
modified, or amended.


 


16.
Severability. In the event any one or more of the provisions contained in the Loan Documents should be held to be invalid, illegal
or unenforceable in any respect, the validity, enforceability and legality of the remaining provisions contained in the Loan Documents
shall not in any manner be affected thereby and shall be enforceable in accordance with their terms.


 


17.
Further Assurances. Borrower shall make, execute or endorse, and acknowledge and deliver or file or cause the same to be done,
all notices, certifications and additional agreements, undertakings, conveyances, transfers, assignments and other assurances, and take
any and all such other action, as Lender may, from time to time, reasonably request and that are reasonably necessary or proper in connection
with any of the Loan Documents.


 


18.
Legal Fees and Expenses. Borrower shall be obligated to the Lender (a) to pay Lender all reasonable fees, expenses and costs (including
reasonable attorneys’ fees and expenses) incurred by the Lender in connection with any amendments, restatements, replacements,
substitutions or modifications of any of the Loan Documents executed or delivered thereafter, and (b) to pay Lender for all reasonable
out- of-pocket expenses and costs (including reasonable attorneys’ fees and court costs) related to the administration, collection,
and enforcement of the Loan Documents.


 


19.
Successors and Assigns. This Note and the other Loan Documents shall be binding upon Borrower and Lender and will inure to the
benefit of Borrower and Lender and their respective successors and permitted assigns, except that Borrower may not assign or transfer
any of its rights or obligations under this Note or the other Loan Documents without the prior written consent of Lender. Lender may,
at any time, assign any of its rights or obligations under this Note or the other Loan Documents without the consent of Borrower.


 


20.
Construction. Unless the express context otherwise requires: (a) the words “hereof”, “herein”, and “hereunder”
and words of similar import, when used in this Note, shall refer to this Note as a whole and not to any particular provision of this
Note; (b) the terms defined in the singular have a comparable meaning when used in the plural, and vice versa; (c) the terms “Dollars”
and “$” mean United States Dollars; (d) wherever the word “include,” “includes,” or “including”
is used in this Note, it shall be deemed to be followed by the words “without limitation”; (e) the word “or”
shall be disjunctive but not exclusive; and (f) references to the “parties” means Lender and Borrower. The parties agree
that they have been represented by counsel during the negotiation and execution of this Note and, therefore, waive the application of
any applicable law or rule of construction providing that ambiguities in an agreement or other document will be construed against the
party or parties drafting such agreement or document. Unless expressly provided otherwise, any approval or consent required to be given
by a party in this Note shall be given or withheld by such party in its sole discretion.


 




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21.
Multiple Counterparts and Facsimile Signatures. This Note and any amendments, waivers, consents or supplements hereto may be executed
in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all taken
together shall constitute a single contract. Delivery of an executed counterpart of a signature page to this Note by facsimile or in
electronic (i.e., “pdf” or “tif”) format shall be effective as delivery of a manually executed counterpart of
this Note.


 


22.
Time of Essence. Time is of the essence for each and every provision of this Note.


 


23.
Trustee Capacity. Each person executing this Note in the capacity of a trustee of a trust has executed and delivered this Note,
not in his individual capacity, but solely as trustee of the trust. The payment and performance of this Note by the trustee and any and
all duties, obligations, and liabilities of the trustee hereunder will be effected by him only as trustee and not in his individual capacity.
The trustee does not undertake nor will he have any personal liability or obligation of any nature whatsoever in his individual capacity
by virtue of the execution and delivery of this Note in the capacity as trustee of a trust. Lender and Borrower acknowledge and agree
that Steven R. Morris does not undertake nor will he have any personal liability or obligation of any nature whatsoever in his individual
capacity or in his capacity as grantor or beneficiary of Borrower by virtue of the execution and delivery of this Note in the capacity
as trustee of a trust.


 


24.
Entirety. This Note and the other Loan Documents embody the final, entire agreement among the parties hereto with respect to the
subject matter hereof and thereof and supersede all prior agreements and understandings, if any, relating to the subject matter hereof
and thereof.


 


[SIGNATURE
PAGE FOLLOWS]


 




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EXECUTED
to be effective as of the Effective Date.


 


	 	BORROWER:
	 	 
	 	BIOLIFE4D
    – SM TRUST, DATED NOVEMBER 1, 2016
	 	 
	 	By:	/s/
    Steven R. Morris
	 	Printed Name:  Steven R. Morris
	 	Title:  Trustee 
	 	 
	 	LENDER:
	 	 
	 	/s/ Gary E. Reynolds
	 	Gary E. Reynolds


 


[Signature
Page to Secured Promissory Note]


 




    	 	 	 



     


    

 


SCHEDULE
“1”


 


ASSETS
AND LIABILITIES OF BORROWER


 


4,800,000
shares of Class A Common Stock of BioLife4D Corporation


 


No
liabilities