Document:

ex41.htm

    Exhibit
4.1

     

    BRIDGE
NOTE

    

    February
2, 2009

    Houston,
Texas

    

    FOR VALUE
RECEIVED, Bonanza Oil and Gas, Inc. (the "Maker"), hereby promises to pay Thomas
D. Harris (the "Payee"),
at such place as Payee may, from time to time, designate, the principal sum of
$285,000 (two hundred eighty
five thousand and no/100) in lawful money of the United States ninety
(90) days from the date hereof (the “Maturity Date”).

    

    Maker
further promises to pay interest on the unpaid principal balance hereof at the
rate of fourteen percent (14%) per annum, such interest to be paid at maturity.
Interest shall be calculated on the basis of a 360 day year and actual days
elapsed. In no event shall the interest charged hereunder exceed the maximum
permitted under the laws of the State of Virginia.

    

    This Note
can be prepaid in whole or in part at any time without the consent of the Payee
provided that Maker shall pay all interest on the principal for the entire term
of the note.

    

    Maker
warrants that any proceeds from an offering of financial instruments of any type
(including equity, debt, hybrid, or other offering) that it receives after the
date of receipt of monies related to this Note shall be first used to repay all
interest and principal pursuant to this Note before being used for any other
purpose whatsoever.

    

    Notwithstanding
the due date of this Note specified above, the entire unpaid principal balance
of this Note and interest accrued with respect thereto shall be immediately due
and payable upon the occurrence of any of the following:

    

    The Maker
becoming insolvent (however defined or evidenced), committing an act of
bankruptcy, making an assignment for the benefit of creditors or making or
sending a notice of intended bulk transfer, or if a meeting of creditors is
convened or a committee of creditors is appointed for, or any petition or
proceeding for any relief under any bankruptcy, reorganization, insolvency,
readjustment of debt, receivership, liquidation or dissolution law or statute
now or hereinafter in effect (whether at law or in equity) is filed or commenced
by or against Maker or any property of Maker, or the appointment of a receiver
or trustee for Maker or any property of Maker.

    

    The Maker
waives demand, presentment, protest and notice of any kind.

    

    This Note
may not be changed, modified or terminated orally, but only by an agreement in
writing, signed by both parties.

    

    This Note
shall be governed by and construed in accordance with the laws of the State of
Virginia to the benefit of the Payee, its successors, endorsees, assigns, heirs,
administrators and executors and shall be binding upon the successors, assigns,
heirs, administrators and executors of the Maker.

    

    The
outstanding principal balance of this Note, and any accrued interest thereon,
shall become immediately due and payable without notice, presentment, protest or
demand upon the occurrence at any time of any of the following events of default
(individually, “an Event of Default” and collectively, “Events of
Default”):

    

    
      	
              (i)  

            	
               the
      Maker fails to pay any of the principal, interest or any other amounts
      payable under this Note within five (5) business days when due and
      payable;

            

    

    

    
      	
              (ii)  

            	
              the
      Maker files any petition or action for relief under any bankruptcy,
      reorganization, insolvency or moratorium law or any other law for the
      relief of, or relating to, debtors, now or hereafter in effect, or seeks
      the appointment of a custodian, receiver, trustee (or other similar
      official) of the Maker or all or any substantial portion of the Maker’s
      assets, or makes any assignment for the benefit of creditors or takes any
      action in furtherance of any of the foregoing, or fails to generally pay
      its debts as they become due;

            

    

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    
      	
              (iii)  

            	
               an
      involuntary petition is filed, or any proceeding or case is commenced,
      against the Maker (unless such proceeding or case is dismissed or
      discharged within ninety (90) days of the filing or commencement thereof)
      under any bankruptcy, reorganization, arrangement, insolvency, adjustment
      of debt, liquidation or moratorium statute now or hereafter in effect, or
      a custodian, receiver, trustee, assignee for the benefit of creditors (or
      other similar official) is applied or appointed for the Maker or to take
      possession, custody or control of any property of the Maker, or an order
      for relief is entered against the Maker by any court having jurisdiction
      in any of the foregoing;

            

    

     

    
      	
              (iv)  

            	
              (iv)
      the occurrence of a breach or default under any agreement, instrument or
      document to which the Maker is a party or by which it is bound involving
      any obligation for borrowed money of more than $100,000 in the aggregate
      that remains uncured for at least thirty (60) business days;
      or

            

    

    

    Upon and
after an Event of Default, the outstanding principal balance hereunder shall
continue to bear interest at a per annum interest rate equal to prime plus ten
percent (10%) until the Event of Default is cured or repayment in full has been
made to the Payee.

    

    Upon the
existence of an Event of Default that remains uncured, the Payee shall have the
right to declare the outstanding principal balance of this Note, together with
all accrued interest, immediately due and payable and the Payee shall thereafter
have all of the rights and remedies afforded creditors generally by the
applicable federal laws or the laws of the state of Virginia.

    

    The
outstanding principal balance of this Note, and accrued interest thereon, may be
prepaid in whole or in part at any time; however, the full interest will still
be levied. Maker shall not be liable hereunder for any further interest on any
amounts so prepaid. All prepayments of this Note shall be applied first to
accrued and unpaid interest, and then to outstanding principal.

    

    All
payments by the Maker under this Note shall be made without set-off or
counterclaim and be free and clear and without any deduction or withholding for
any taxes or fees of any nature whatever, unless the obligation to make such
deduction or withholding is imposed by law.

    

    No delay
or omission on the part of the Payee in exercising any right under this Note
shall operate as a waiver of such right or of any other right of the Payee, nor
shall any delay, omission or waiver on any one occasion be deemed a bar to or
waiver of the same or any other right on any future occasion.

    If any
term or provision of this Note shall be held invalid, illegal or unenforceable,
the validity of all other terms and provisions hereof shall in no way be
affected thereby.

    

    Miscellaneous.

    

    a. The
representations and warranties of the Borrower contained herein shall not
survive the Closing Date.

    

    b. This
Agreement shall be governed by and construed in accordance with the laws of the
State of Virginia without giving effect to conflicts of laws principles that
would result in the application of the substantive laws of another jurisdiction.
This Agreement shall not be interpreted or construed with any presumption
against the party causing this Agreement to be drafted.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

       

    

    c. The
Bank and Borrower agree to submit to binding arbitration by the American
Arbitration Association (the "AAA")of all claims, disputes and controversies
(whether in tort, contract, or otherwise, except
"core proceedings" under the U.S. Bankruptcy Code) arising between themselves
and their respective employees, officers, directors, attorneys and other agents,
which relate in any way without limitation to existing and future loans and
extensions of credit or requests for additional credit, including by way of
example but not by way of limitation the negotiation, collateralization,
administration, repayment, modification, default, termination and enforcement of
such loans or extensions of credit. Arbitration under this Agreement will be
governed by the Federal Arbitration Act and proceed in Virginia in accordance
with AAA Rules. Arbitration will be conducted before a single neutral arbitrator
selected in accordance with AAA Rules and who shall be an attorney who has
practiced commercial law for at least ten years. The arbitrator will determine
whether an issue is arbitratable and will give effect to applicable statutes of
limitation. Judgment upon the arbitrator's award may be entered in any court
having jurisdiction. The arbitrator has the discretion to decide, upon documents
only or with a hearing, any motion to dismiss for failure to state a claim or
any motion for summary judgment. The institution and maintenance of an action
for judicial relief or for any provisional or ancillary remedy shall not
constitute a waiver of the right of any party, including the plaintiff, to
submit the controversy or claim to arbitration if any other party contests such
action for judicial relief. Discovery will be governed by the Virginia Rules of
Civil Procedure. Discovery must be completed at least 20 days before the hearing
date and within 180 days of the commencement of arbitration. Each request for an
extension and all other discovery disputes will be determined by the arbitrator
upon a showing that the request is essential for the party's presentation and
that no alternative means for obtaining information are available during the
initial discovery period. This Agreement does not limit the right of either
party to a) foreclose against real or personal property collateral; b) exercise
self-help remedies such as setoff or repossession; c) obtain provisional
remedies such as replevin, injunctive relief, attachment or the appointment of a
receiver during the pendency or before or after any arbitration proceeding; or
d) obtain a cognovit judgment, if available. These exceptions do not constitute
a waiver of the right or obligation of either party to submit any dispute to
arbitration, including those arising from the exercise of these
remedies.

    

    d. Any
forbearance, failure, or delay by the Lender in exercising any right, power, or
remedy shall not preclude the further exercise thereof, and all of the Lender’s
rights, powers, and remedies shall continue in full force and effect until
specifically waived in writing by the Lender.

    e. This
Agreement may be executed in two or more counterparts, all of which shall be
considered one and the same agreement and shall become effective when
counterparts have been signed by each party and delivered to the other
party.

    

    f. The
headings of this Agreement are for convenience of reference and shall not form
part of, or affect the interpretation of, this Agreement.

    

    g. If any
provision of this Agreement shall be invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall not affect the validity
or enforceability of the remainder of this Agreement or the validity or
enforceability of this Agreement in any other jurisdiction.

    

    h. This
Agreement, the Bridge Note and the instruments referenced herein contain the
entire understanding of the parties with respect to the matters covered herein
and therein. No provision of this Agreement may be waived or amended other than
by an instrument in writing signed by the party to be charged with
enforcement.

    

    i. This
Agreement shall be binding upon and inure to the benefit of the parties and
their successors and assigns. The Borrower shall not assign this Agreement or
any rights or obligations hereunder without the prior written consent of the
Lender. Notwithstanding the foregoing, the Lender may assign its rights
hereunder to any other person or entity without the consent of the
Borrower.

    

    j. This
Agreement is intended for the benefit of the parties hereto and their respective
permitted successors and assigns, and is not for the benefit of, nor may any
provision hereof be enforced by, any other person.

    

    k. All
remedies of the Lender under this Agreement, the Bridge Note and the other
Bridge Loan Documents (i) are cumulative and concurrent, (ii) may be exercised
independently, successively or together with other lenders against the Borrower,
(iii) shall not be exhausted by any exercise thereof, but may be exercised as
often as occasion therefore may occur, and (iv) shall not be construed to be
waived or released by the Lender’s delay in exercising, or failure to exercise,
them or any of them at any time it may be entitled to do so.

    

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    

     

    

 

    
      
        	 	Bonanza
      Oil and Gas, Inc.	 
	 	 	 	 
	
                February
      2, 2009

              	
                By:
      

              	/s/ William
      Wiseman	 
	 	 	William
      Wiseman	 
	 	 	CEO	 
	 	 	 	 

      

     

    

    By:/s/ Thomas
D. Harris

    
      

    

    Thomas D.
Harris

    8820 Path
Valley Road

    PO Box
289

    Fannettsburg,
PA 17221

    

    _________________

    Date

     

     

     

     

    4ex42.htm

    Exhibit
4.2

    
 

    February
2, 2009

    

    Bonanza
Oil and Gas, Inc.

    3000
Richmond Ave.

    Suite
400

    Houston,
TX 77098

    

    RE:           Bridge Loan Letter
Agreement

    

    Mr.
Lender:

    

    
      	
              1.  

            	
              Loan.
      This letter when fully executed will constitute a loan agreement (this
      “Agreement”)

            

    

    between
Thomas D. Harris (the “Lender”) and Bonanza Oil and
Gas, Inc, a Nevada corporation (the “Borrower”), pursuant to which
the Lender, on the terms and conditions provided herein, shall agree to make one
loan to the Borrower hereunder in an amount of $285,000 (the “Loan”). The Lender’s
obligation to make the Loan is subject to the Borrower’s fulfillment of each of
the applicable conditions set forth in Section 3 hereof.

    

    2. Bridge
Loan Documents.

    

    a.            Promissory Bridge
Notes. The Loan shall be evidenced by a promissory bridge note issued to
the Lender in the principal amount of the Loan, dated the date the Borrower
receives the funds from the Lender, in the form attached hereto as Exhibit A (together
with any replacements and substitutes therefore, the “Bridge Note”). The principal
amount of the Loan and interest thereon, calculated at the rate of 14% per
annum, as provided in the Bridge Note, shall be payable as set forth more
particularly therein.

    

    b.           Term of Note. “The Bridge Note” shall have a
term of 90 days starting from the date the Borrower receives the funds from the
Lender in their entirety. In the event of prepayment by the Borrower, the Lender
will receive interest for the entire term of the note as set forth in Section
2(b). Any changes to the term of the note must be accordance to Section
5(c).

    

    c.           Accredited Investor.
The Lender hereby represents and warrants that it is an “accredited investor” as
defined in Rule 501 of Regulation D promulgated under the Securities Act of
1933, as amended

    

    d.           This
Agreement, the Bridge Note and any other instruments or documents required or
contemplated hereunder or thereunder, whether now existing or at any time
hereafter arising, are herein referred to as the “Bridge Loan
Documents.”

    

    3.       Conditions
Precedent.

    

    a. Documents to be
Delivered. The obligation of the Lender to make the Loan is subject to
the due execution and delivery by the Borrower (or the Borrower causing the
due
execution and delivery) to the Lender of each of the following (all documents to
be in form and substance satisfactory to the Lender):

    

    i. This
Agreement, the Bridge Note and each other instrument, agreement and document to
be executed and/or delivered pursuant to this Agreement and/or the instruments,
agreements and documents referred to in this Agreement.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    ii. A
certified copy of the resolutions of the Board of Directors (or if the Board of
Directors takes action by unanimous written consent, a copy of such unanimous
written consent containing all of the signatures of the members of the Board of
Directors) of the Borrower, dated as of the Closing Date, authorizing the
execution, delivery and performance of the Bridge Loan Documents.

    iii. A
certificate, dated as of the Closing Date, signed by an executive officer of the
Borrower to the effect that the representations and warranties set forth in
Section 4 of this Agreement are true and correct as of the Closing
Date.

    

    b. Absence of Certain
Events. The occurrence of a Material Adverse Effect (as defined below)
shall not have occurred or be occurring as of the Closing Date.

    

    4.       Representations
and Warranties of the Borrower. To induce the Lender to make the Loan,
the Borrower hereby represents and warrants to the Lender that at and as of the
date hereof:

    

            a.                 The
Borrower has been duly incorporated and validly exists and is in good standing
under the laws of the state of Nevada, with full corporate power and authority
to own, lease and operate its properties and to conduct its business as
currently conducted. The Borrower is duly qualified as a foreign entity to do
business and is in good standing in every jurisdiction in which its ownership of
property or the nature of the business conducted by it makes such qualification
necessary and where the failure so to qualify would have a Material Adverse
Effect. “Material Adverse
Effect” means any material adverse effect on the ability of the Borrower
to perform its obligations hereunder or under the Bridge Loan Documents or on
the business, operations, properties or financial condition of the
Borrower.

    

    b.           Each
of the Bridge Loan Documents has been duly authorized, validly executed and
delivered on behalf of the Borrower and is a valid and binding obligation of the
Borrower enforceable against the Borrower in accordance with its terms, subject
to limitations on enforcement by general principles of equity and by bankruptcy
or other laws affecting the enforcement of creditors’ rights generally, and the
Borrower has full power and authority to execute and deliver this Agreement and
the Bridge Loan Documents and to perform its obligations hereunder and there
under.

    

    c.           The
execution, delivery and performance of this Agreement and the Bridge Loan
Documents will not (i) conflict with or result in a breach of or a default under
any of the terms or provisions of (A) the Borrower’s articles of incorporation
or by-laws, or (B) any material provision of any indenture, mortgage, deed of
trust or other material agreement or instrument
to which the Borrower is a party or by which it or any of its material
properties or assets is bound, (ii) result in a violation of any material
provision of any law, statute, rule, regulation, or any existing applicable
decree, judgment or order by any court, Federal or state regulatory body,
administrative agency, or other governmental body having jurisdiction over the
Borrower, or any of its material properties or assets or (iii) result in the
creation or imposition of any material lien, charge or encumbrance upon any
material property or assets of the Borrower or any of its subsidiaries pursuant
to the terms of any agreement or instrument to which any of them is a party or
by which any of them may be bound or to which any of their property or any of
them is subject, except, in the cases of (i), (ii) and (iii) above, as would not
have a Material Adverse Effect.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    d. No
consent, approval or authorization of or designation, declaration or filing with
any governmental authority on the part of the Borrower is required in connection
with the valid execution and delivery of this Agreement or the Bridge Loan
Documents.

    

    5.       Miscellaneous.

    

    a.           The
representations and warranties of the Borrower contained herein shall not
survive the Closing Date.

    

    b.           This
Agreement shall be governed by and construed in accordance with the laws of the
State of Nevada without giving effect to conflicts of laws principles that would
result in the application of the substantive laws of another jurisdiction. This
Agreement shall not be interpreted or construed with any presumption against the
party causing this Agreement to be drafted.

    

    c.           The
Bank and Borrower agree to submit to binding arbitration by the American
Arbitration Association (the "AAA") of all claims, disputes and controversies
(whether in tort, contract, or otherwise, except "core proceedings" under the
U.S. Bankruptcy Code) arising between themselves and their respective employees,
officers, directors, attorneys and other agents, which relate in any way without
limitation to existing and future loans and extensions of credit or requests for
additional credit, including by way of example but not by way of limitation the
negotiation, collateralization, administration, repayment, modification,
default, termination and enforcement of such loans or extensions of credit.
Arbitration under this Agreement will be governed by the Federal Arbitration Act
and proceed in Virginia in accordance with AAA Rules. Arbitration will be
conducted before a single neutral arbitrator selected in accordance with AAA
Rules and who shall be an attorney who has practiced commercial law for at least
ten years. The arbitrator will determine whether an issue is arbitratable and
will give effect to applicable statutes of limitation. Judgment upon the
arbitrator's award may be entered in any court having jurisdiction. The
arbitrator has the discretion to decide, upon documents only or with a hearing,
any motion to dismiss for failure to state a claim or any motion for summary
judgment. The institution and maintenance of an action for judicial relief or
for any provisional or ancillary remedy shall not constitute a waiver of the
right of any party, including the plaintiff, to submit the controversy or claim
to arbitration if any other party contests such action for judicial relief. Each
request for an extension and all other discovery disputes will be determined by
the arbitrator upon a showing that the request is essential for the party's
presentation and that no alternative means for obtaining information are
available during the initial discovery period. This Agreement does not limit the
right of either party to a) foreclose against real or personal property
collateral; b) exercise self-help remedies such as setoff or repossession; c)
obtain provisional remedies such as replevin, injunctive relief, attachment or
the appointment of a receiver during the pendency or before or after any
arbitration proceeding; or d) obtain a cognovit judgment, if available. These
exceptions do not constitute a waiver of the right or obligation of either party
to submit any dispute to arbitration, including those arising from the exercise
of these remedies.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    d.           
Any forbearance, failure, or delay by the Lender in exercising any right, power,
or remedy shall not preclude the further exercise thereof, and all of the
Lender’s rights, powers, and remedies shall continue in full force and effect
until specifically waived in writing by the Lender.

    

    e.           This
Agreement may be executed in two or more counterparts, all of which shall be
considered one and the same agreement and shall become effective when
counterparts have been signed by each party and delivered to the other
party.

    

    f.           The
headings of this Agreement are for convenience of reference and shall not form
part of, or affect the interpretation of, this Agreement.

    

    g.           If
any provision of this Agreement shall be invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall not affect the validity
or enforceability of the remainder of this Agreement or the validity or
enforceability of this Agreement in any other jurisdiction.

    

    h.           This
Agreement, the Bridge Note and the instruments referenced herein contain the
entire understanding of the parties with respect to the matters covered herein
and therein. No provision of this Agreement may be waived or amended other than
by an instrument in writing signed by the party to be charged with
enforcement.

    

    i.           This
Agreement shall be binding upon and inure to the benefit of the parties and
their successors and assigns. The Borrower shall not assign this Agreement or
any rights or obligations hereunder without the prior written consent of the
Lender. Notwithstanding the foregoing, the Lender may assign its rights
hereunder to any other person or entity without the consent of the
Borrower.

    

    j.           This
Agreement is intended for the benefit of the parties hereto and their respective
permitted successors and assigns, and is not for the benefit of, nor may any
provision hereof be enforced by, any other person.

    

    k.           
All remedies of the Lender under this Agreement, the Bridge Note and the other
Bridge Loan Documents (i) are cumulative and concurrent, (ii) may be exercised
independently, successively or together with other lenders against the Borrower,
(iii) shall not be exhausted by any exercise thereof, but may be exercised as
often as occasion therefore may occur, and (iv) shall not be construed to be
waived or released by the Lender’s delay in exercising, or failure to exercise,
them or any of them at any time it may be entitled to do so.

     

    l.           All
notices required hereunder shall be made in accordance with Section 10 of the
Bridge Note.

    

    m.           By
executing the appropriate signature line below, the Borrower, intending to be
legally bound hereby, agrees to the terms and conditions of this Agreement as of
the date hereof.

    

    Very
truly yours,

    
 

    By:­­­­/s/ William
Wiseman                                                                                     Date:
February 2, 2009

    
      
        

      

    

    Name:
William Wiseman

    Title:
CEO

    Bonanza
Oil and Gas, Inc.

    3000
Richmond Ave. Suite 400

    Houston,
TX 77098

    

    

    By: /s/Thomas
D. Harris

    
      
        

      

    

    Thomas D.
Harris

    8820 Path
Valley Road

    PO Box
289

    Fannettsburg,
PA 17221

    

    

    _______________

    Date   

     

     

     

     

    4

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