Document:

Camber Energy, Inc. 8-K

 

Exhibit 10.3

 

FUNDING
AND LOAN AGREEMENT

 

THIS FUNDING AND LOAN
AGREEMENT (this “Agreement”) is made and entered into as of July 8, 2019, by and among Camber Energy, Inc.,
a Nevada corporation (“Parent”), Lineal Star Holdings, LLC, a Delaware limited liability company (“LSH”),
and the Parent preferred stockholders set forth on the signature page hereto (the “Preferred Holders” and, together
with LSH and the Parent, sometimes referred to individually as a “Party” and collectively as the “Parties”).

 

RECITALS

 

WHEREAS, the Parties
are parties to that certain Agreement and Plan of Merger, dated as of even date herewith (the “Merger Agreement”)
(capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Merger Agreement);

 

WHEREAS, immediately
following the Closing, the Parent shall deposit or cause to be deposited into a newly opened and dedicated bank account maintained
by the Parent (the Account, defined and discussed below), an amount equal to $4,000,000 (the “Deposit”), to
be held and distributed by the Parent on the terms set forth herein; and

 

WHEREAS, the Parties
wish to specify their respective rights and obligations with respect to the Account Funds.

 

NOW THEREFORE, in consideration
of the foregoing and the covenants and agreements hereinafter set forth and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Parties agree as follows:

 

1.           
Account Funds.

 

(a)          
Within seven (7) days after the Closing, the Parent shall open a dedicated bank account (at a bank mutually agreed to between
the Parent and a Majority Interest of the Series E Preferred Stock, provided that the Parties confirm and acknowledge that Veritex
Community Bank is a “mutually agreed to” bank) which shall be separate from the Parent’s standard operating bank
account (the “Account”). An officer designated by the Parent and one person designated by the Series E Preferred
Stock holders (which person shall initially be Tim Connolly) (the “Preferred Authorized Representative”), shall
have to approve all disbursements, payments and draws on the Account. The Preferred Authorized Representative may be removed or
replaced from time to time with the written consent of a Majority Interest of the Series E Preferred Stock and the holder of the
Series F Preferred Stock.

 

(b)          
Immediately thereafter, the Parent shall deposit the Deposit in immediately available funds into the Account. The Parent
shall hold the Deposit, together with all products and proceeds thereof, including all interest, gains and other income earned
with respect thereto (collectively, the “Earnings” and together with the Deposit but less any disbursements,
the “Account Funds”) in the Account, in accordance with the terms and subject to the conditions of this Agreement.

 

     

     

    

 

(c)          
All Earnings, to the extent applicable, shall be retained by the Parent and reinvested in the Account Funds, shall become
part of the Account Funds, and shall be disbursed in accordance with the terms and subject to the conditions of this Agreement.

 

2.           
Disposition and Termination of the Account Funds.

 

The Parent and LSH
shall act in accordance with, and the Parent shall hold and release the applicable portions of the Account Funds as provided in,
this Section 2 as follows:

 

(a)          
Release Approval and Final Determination. Upon receipt of a Release Approval, or a Final Determination, as applicable,
with respect to all or a portion of the Account Funds, the Parent shall promptly, but in any event within two (2) Business Days
after the receipt of a Release Approval or Final Determination, disburse all or part of the Account Funds in accordance with such
Release Approval or Final Determination.

 

(b)          
Method of Payment. All payments of any part of the Account Funds shall be made by wire transfer of immediately available
funds as set forth in the Release Approval or Final Determination, as applicable.

 

(c)          
Certain Definitions.

 

(i)            
“Final Determination” means a final, non-appealable order of any court or arbitrator of competent jurisdiction
which may be issued, together with (A) a certification of the prevailing Party to the effect that such order is final and non-appealable
and from a court or arbitrator of competent jurisdiction having proper authority and (B) the written payment instructions of the
prevailing Party to effectuate such order.

 

(ii)           
“Release Approval” means the written agreement executed by (a) a Majority Interest of the Series E Preferred
Stock and the holder of the Series F Preferred Stock; and (b) the Parent, setting forth the disbursement of all or a portion of
the Account Funds, as applicable, for Acquisitions. The Release Approval shall also set forth the structure of the Acquisition,
including the ownership breakdown of any acquired entity, business or assets, between LSH and Parent (each an “Acquisition
Structure”). For the sake of clarity, all of the terms of the Acquisitions and each Acquisition Structure shall be approved
by (i) a Majority Interest of the Series E Preferred Stock and the holder of the Series F Preferred Stock; and (ii) the Parent.

 

(d)          
“Acquisitions” means acquisitions of assets and/or securities of complementary businesses of LSH.

 

3.           
Loan. Within two (2) days after the Closing, the Parent shall wire $1,050,000 in immediately available funds to LSH’s
account at Veritex Community Bank (the “Loan”). The Loan shall be documented by a promissory note (signed by
LSH as borrower and the Parent as lender) in the form of Exhibit A hereto, which shall accrue interest, compounded monthly,
at 10% per annum, beginning upon the date that the Holder no longer owns at least 50% of the voting securities of the Company,
and which note (and the amounts owed thereunder) shall either be (a) forgiven on the date that Parent Shareholder Approval is received;
or (b) be payable in full together with accrued interest thereon, two (2) years from the date that Parent no longer owns at least
50% of LSH’s voting securities due to redemptions of Series E Preferred Stock and Series F Preferred Stock, by the holders
thereof.

 

    
Funding and Loan Agreement
Page 2 of 7

     

    

 

4.            
Notices. All notices, requests, demands, and other communications to be given or delivered under or by reason of
the provisions of this Agreement shall be in writing and shall be deemed to have been given when (a) delivered by hand, (b) one
(1) Business Day after being sent by a nationally recognized overnight courier service (costs prepaid), (c) sent by facsimile or
email with confirmation of transmission by the transmitting equipment, or (d) received by the addressee, if sent by certified mail,
postage prepaid and return receipt requested. If notice is given to a Party, it shall be given at the address for such party set
forth below. It shall be the responsibility of the Parties to notify the other Parties in writing of any name or address changes.

 

If to the Parent
to:

 

Camber Energy,
Inc.

Attn:    Louis
G. Schott; Robert Schleizer

1415 Louisiana,
Suite 3500

Houston, Texas
77002

Email: louisgschott@gmail.com
and bschleizer@camber.energy

 

With a copy,
which shall not constitute notice to:

 

Dickinson
Wright PLLC

Attn:
Joel D. Mayersohn 

350
East Las Olas Blvd.

Suite
1750

Fort
Lauderdale, Florida 33301

Fax       844-670-6009

Email    JMayersohn@dickinsonwright.com

 

If to the Company or
the Preferred Holders, to:

 

Lineal Star
Holdings, LLC

Attn: Tim
Connolly

123 N. Post
Oak Lane Suite 440

Houston, Texas
77024

Fax:
713-586-6678

Email:
tim@csbankers.com

 

With a copy,
which shall not constitute notice to:

 

Hughes Arrell
Kinchen LLP

Attn: Mark
Hughes

1221 McKinney
St., Suite 3150

Houston, Texas
77010

Fax:
713-942-2266

Email:
mhughes@hakllp.com

 

    
Funding and Loan Agreement
Page 3 of 7

     

    

 

K&L Gates
LLP

Attn: Clayton
Parker

Southeast
Financial Center

200 S. Biscayne
Boulevard, Suite 3900

Miami, FL
33131

Fax: 305-358-7095

Email: Clayton.Parker@klgates.com

 

5.          
Termination. This Agreement shall terminate on the first to occur of (a) the distribution of all of the amounts in
the Account in accordance with this Agreement; (b) delivery to the Parent of a written notice of termination executed by a Majority
Interest of the Series E Preferred Stock and the holder of the Series F Preferred Stock; and (c) delivery to the Preferred Holders
of a written notice of termination executed by the Parent, in the event the Series E Preferred Stock and Series F Preferred Stock
have been fully redeemed by the Parent, after which this Agreement shall be of no further force and effect.

 

6.           
Representation by the Parent.

 

(a)          
The Parent hereby represents and warrants to the other Parties hereto that the Account and the Deposit are owned solely
and directly by the Parent and are free and clear of all Liens.

 

(b)          
The Parent hereby acknowledges that the entry into this Agreement was a material inducement for the Preferred Holders to
enter into the Merger Agreement and the Preferred Holders would not have entered into the Merger Agreement but for the Parent entering
into this Agreement.

 

7.           
Miscellaneous.

 

(a)          
The provisions of this Agreement may be waived, altered, amended or supplemented, in whole or in part, only by a writing
signed by all of the Parties.

 

(b)          
Neither this Agreement nor any right or interest hereunder may be assigned in whole or in part by any Party without the
prior written consent of the other Parties.

 

(c)          
This Agreement shall be governed by and construed under the laws of the State of Texas without giving effect to any choice
or conflict of law provision or rule (whether of the State of Texas or any other jurisdiction).

 

(d)          
Any action or proceeding arising out of or relating to this Agreement shall be heard and determined exclusively by the State
and Federal Courts located in Harris, County, Texas, and each of the Parties to this Agreement irrevocably submits to the exclusive
jurisdiction of such courts in any such action or proceeding, waives any objection it may now or hereafter have to venue or to
convenience of forum, agrees that all claims in respect of the action or proceeding shall be heard and determined only in any such
court and agrees not to bring any action or proceeding arising out of or relating to this Agreement in any other court. The Parties
hereto agree that any or all of them may file a copy of this Section 7(d) with any court as written evidence of the knowing,
voluntary and bargained-for agreement among the parties irrevocably to waive any objections to venue or to convenience of forum.
Process in any action or proceeding referred to in the first sentence of this Section 7(d) may be served on any Party anywhere
in the world.

 

    
Funding and Loan Agreement
Page 4 of 7

     

    

 

(e)          
EACH PARTY HERETO IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF SUCH COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING.
SERVICE OF PROCESS, SUMMONS, NOTICE OR OTHER DOCUMENT BY MAIL TO SUCH PARTY’S ADDRESS SET FORTH HEREIN SHALL BE EFFECTIVE
SERVICE OF PROCESS FOR ANY SUIT, ACTION OR OTHER PROCEEDING BROUGHT IN ANY SUCH COURT. THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY
WAIVE ANY OBJECTION TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR ANY PROCEEDING IN SUCH COURTS AND IRREVOCABLY WAIVE AND AGREE
NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN
AN INCONVENIENT FORUM. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT OR THE ANCILLARY
DOCUMENTS IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES AND, THEREFORE, EACH SUCH PARTY IRREVOCABLY AND UNCONDITIONALLY
WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LEGAL ACTION ARISING OUT OF OR RELATING TO THIS AGREEMENT. EACH
PARTY TO THIS AGREEMENT CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT SEEK TO ENFORCE THE FOREGOING WAIVER IN THE EVENT OF A LEGAL ACTION, (B) SUCH
PARTY HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (C) SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (D) SUCH PARTY
HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION
7.

 

(f)           
This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument. All signatures of the parties to this Agreement may be transmitted by facsimile or
electronic transmission in portable document format (.pdf), and such facsimile or .pdf will, for all purposes, be deemed to be
the original signature of such party whose signature it reproduces, and will be binding upon such party.

 

(g)          
If any provision of this Agreement is determined to be prohibited or unenforceable by reason of any applicable law of a
jurisdiction, then such provision shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability
without invalidating the remaining provisions thereof, and any such prohibition or unenforceability in such jurisdiction shall
not invalidate or render unenforceable such provisions in any other jurisdiction.

 

    
Funding and Loan Agreement
Page 5 of 7

     

    

 

8.            
Nothing in this Agreement, whether express or implied, shall be construed to give any Person other than the Parent, LSH
or the holders of the Series E and Series F Preferred Stock any legal or equitable right, remedy, interest or claim under or in
respect of this Agreement or any funds provided for hereunder. The language used in this Agreement shall be deemed to be the language
chosen by the parties hereto to express their mutual intent, and the parties intend that no rule of strict construction will be
applied against any Person. The Parties agree that, notwithstanding anything to the contrary contained in this Agreement or in
any other agreement, in the event of any conflict or inconsistency between the terms of this Agreement (on the one hand) and the
Merger Agreement (on the other hand), the terms of this Agreement shall govern.

 

9.            
Specific Performance. The Parties agree that irreparable damage would occur if any provision of this Agreement were
not performed in accordance with the terms hereof and that the parties shall be entitled to specific performance of the terms hereof,
in addition to any other remedy to which they are entitled at law or in equity.

 

10.          
Further Assurances. Following the date hereof, each Party shall deliver to the other Parties such further information
and documents and shall execute and deliver to the other parties such further instruments and agreements as any other Party shall
reasonably request to consummate or confirm the transactions provided for herein, to accomplish the purpose hereof or to assure
to any other Party the benefits hereof.

 

    
Funding and Loan Agreement
Page 6 of 7

     

    

 

IN WITNESS WHEREOF,
the parties hereto have executed this Agreement as of the date set forth above.

 

	PARENT:	 
	 	 
	CAMBER ENERGY, INC.	 
	 	 	 
	By:	/s/ Louis G. Schott	 
	Name:  Louis G. Schott

Title:  Interim CEO	 

 

	LSH:	 
	 	 
	LINEAL STAR HOLDINGS, LLC	 
	 	 	 
	By:	/s/ Timothy J. Connolly	 
	Name:  Timothy J. Connolly

Title:  Chief Executive Officer	 

 

	PREFERRED HOLDERS:	 
	 	 
	JSHAN ENERGY, LLC	 
	 	 	 
	By:	/s/ Jerry C. Shanklin	 
	Name:  Jerry C. Shanklin

Title:  President	 

 

	/s/ Brian Shanklin	 
	BRIAN SHANKLIN	 
	 	 
	/s/ Blain Shanklin	 
	BLAIN SHANKLIN	 
	 	 
	/s/ Craig Crawford	 
	CRAIG CRAWFORD	 
	 	 
	/s/ Timothy J. Connolly	 
	TIMOTHY J. CONNOLLY	 

 

    
Funding and Loan Agreement
Page 7 of 7Camber Energy, Inc. 8-K

 

Exhibit 10.4

 

PROMISSORY NOTE

 

	US $1,050,000	Effective July 8, 2019

 

NOW
THEREFORE FOR VALUE RECEIVED, the undersigned, Lineal Star Holdings, LLC, a Delaware limited liability company (the “Company”), hereby promises
to pay to the order of Camber Energy, Inc., a Nevada corporation and its assigns (“Holder”), the
principal sum of One Million Fifty-Thousand Dollars and No Cents (US $1,050,000) (the “Principal”),
in lawful money of the United States of America, which shall be legal tender, bearing interest and payable as provided herein.
This Promissory Note (this “Note” or “Promissory Note”) has an effective date
of July 8, 2019 (the “Effective Date”). This Note is entered into to evidence amounts loaned from the
Holder to the Company on the Effective Date, pursuant to that certain Funding and Loan Agreement entered into between the Company,
the Holder, and certain holders of the Holder’s preferred stock, on or around July 8, 2019.

 

1.            
Interest (“Interest”) shall accrue on the Principal amount of this Note at the rate
of ten percent (10%) per annum (the “Interest Rate”), compounded monthly on the last day of each calendar
month beginning on the Interest Effective Date (“Monthly Interest”). All Interest payable hereunder shall
be calculated by multiplying the actual days elapsed in the period for which Interest is being calculated by a daily rate based
on the Interest Rate (or Default Rate, as applicable) and a 365 day year. All Monthly Interest shall be due on the Maturity Date.
The Company will pay interest on the first day of each month of each year after the Interest Effective Date. All past-due Principal
and Interest shall bear interest at the lesser of (a) the rate of eighteen percent (18%) per annum; and (b) the Maximum Rate, until
paid in full (the “Default Rate”). For the sake of clarity, this Note shall
not accrue Interest prior to the Interest Effective Date.

 

2.            
The “Interest Effective Date” shall be the date that the Holder no longer owns at least 50%
of the voting securities of the Company.

 

3.            
The “Maturity Date” of this Note shall be the earlier of (a) two (2) years from the Interest
Effective Date; and (b) the date that Holder has effected an Acceleration.

 

4.            
In the event the Parent Shareholder Approval has been received, as such term is defined in that certain Agreement and
Plan of Merger, dated on or around the date hereof, by and between the Holder, the Company and the owners of the Company prior
to the Holder (the “Merger Agreement”), this Note, and all Principal and Interest due hereunder, shall
be deemed automatically forgiven by the Holder and this Note shall be cancelled without any additional action on the part of the
Company.

 

5.            
Upon the occurrence of an Event of Default hereunder the Principal amount of this Note and any accrued Interest thereon
shall bear interest at the Default Rate.

 

6.            
This Note may be prepaid in whole or in part, at any time and from time to time, without premium or penalty.

 

    
Page 1 of 6
Promissory Note

     

    

 

7.            
All payments made by Company under this Note will be applied: (i) first, to late charges, costs of collection or enforcement,
and similar amounts due, if any, under the Note; (ii) second, to Interest that is due and payable under this Note, if any; and
(iii) third, the remainder to Principal due and payable under this Note.

 

8.            
If any payment of Principal or Interest on this Note shall become due on a Saturday, Sunday or any other day on which
national banks are not open for business, such payment shall be made on the next succeeding business day.

 

9.            
This Note shall be binding upon Company and inure to the benefit of Holder and Holder’s respective successors
and assigns. Each holder of this Note, by accepting the same, agrees to and shall be bound by all of the provisions of this Note.
Holder may assign this Note or any of its rights, interests or obligations to this Note without the prior written approval of Company.

 

10.         
No provision of this Note shall alter or impair the obligation of Company to pay the Principal of and Interest on this
Note at the times, places and rates, and in the coin or currency, herein prescribed.

 

11.          Company
will do or cause to be done all things reasonably necessary to preserve and keep in full force and effect its corporate
existence, rights and franchises and comply with all laws applicable to Company, except where the failure to comply could not
reasonably be expected to have a material adverse effect on Company.

 

12.         
Notwithstanding anything to the contrary in this Note or any other agreement entered into in connection herewith, whether
now existing or hereafter arising and whether written or oral, it is agreed that the aggregate of all Interest and any other charges
constituting interest, or adjudicated as constituting interest, and contracted for, chargeable or receivable under this Note or
otherwise in connection with this loan transaction, shall under no circumstances exceed the Maximum Rate.

 

13.         
Company represents and warrants to Holder as follows:

 

(a)           
The execution and delivery by Company of this Note (i) are within Company’s power and authority, and (ii) have been
duly authorized by all necessary action.

 

(b)           
This Note is a legally binding obligation of Company, enforceable against Company in accordance with the terms hereof, except
to the extent that (i) such enforceability is limited by bankruptcy, insolvency, reorganization, moratorium or other laws relating
to or affecting generally the enforcement of creditors’ rights, and (ii) the availability of the remedy of specific performance
or injunctive or other equitable relief is subject to the discretion of the court before which any proceeding therefore may be
brought.

 

    
Page 2 of 6
Promissory Note

     

    

 

14.          If
an Event of Default (as defined herein) occurs (unless all Events of Default have been cured or waived by Holder), Holder may,
by written notice to Company, declare the Principal amount then outstanding of, and the accrued Interest and all other amounts
payable on, this Note to be immediately due and payable (an “Acceleration”) (provided that upon the
occurrence of an Event of Default described in Section 12(c) below, the Principal amount then outstanding of, and
the accrued Interest and all other amounts payable on, this Note shall immediately be due and payable) and can take any and all
other actions provided for under applicable law. The following events and/or any other Events of Default defined elsewhere in
this Note are “Events of Default” under this Note:

 

(a)           
Company shall fail to pay, when and as due, the Principal, Interest or any other amount payable hereunder, within five (5)
days from the due date of such payment; or

 

(b)           
Company shall have breached in any material respect any covenant, term or condition in this Note, and, with respect to breaches
capable of being cured, such breach shall not have been cured within ten (10) days after written notice thereof has been provided
by Holder to Company; or

 

(c)           
Company shall: (i) be adjudicated insolvent or take any action which constitutes its admission of inability to pay its debts
as they mature; (ii) make an assignment for the benefit of creditors, file a petition in bankruptcy, petition or apply to any tribunal
for the appointment of a custodian, receiver or a trustee for it or a substantial portion of its assets; (iii) commence any proceeding
under any bankruptcy, reorganization, arrangement, readjustment of debt, dissolution or liquidation or statute of any jurisdiction,
whether now or hereafter in effect; (iv) have filed against it any such petition or application in which an order for relief is
entered or which remains undismissed for a period of ninety (90) days or more; (v) indicate its consent to, approval of or acquiescence
in any such petition, application, proceeding or order for relief or the appointment of a custodian, receiver or trustee for it
or a substantial portion of its assets; (vi) suffer any such custodianship, receivership or trusteeship to continue undischarged
for a period of ninety (90) days or more; or (vii) Company shall take any action authorizing, or in furtherance of, any of the
foregoing.

 

In case any one or
more Events of Default shall occur and be continuing, Holder may proceed to protect and enforce its rights by an action at law,
suit in equity or other appropriate proceeding, whether for the specific performance of any agreement contained herein or for an
injunction against a violation of any of the terms hereof, or in aid of the exercise of any power granted hereby or thereby or
by law or otherwise. In case of a default in the payment of any Principal of or premium, if any, or Interest on this Note, Company
will pay to Holder such further amount as shall be sufficient to cover the reasonable cost and expenses of collection, including,
without limitation, reasonable attorneys’ fees, expenses and disbursements. No course of dealing and no delay on the part
of Holder in exercising any right, power or remedy shall operate as a waiver thereof or otherwise prejudice Holder’s rights,
powers or remedies. No right, power or remedy conferred by this Note upon Holder shall be exclusive of any other right, power or
remedy referred to herein or therein or now or hereafter available at law, in equity, by statute or otherwise.

 

    
Page 3 of 6
Promissory Note

     

    

 

15.         
Except as expressly provided otherwise in this Note, Company and every endorser or guarantor, if any, of this Note waive
presentment, demand, notice, protest and all other demands and notices in connection with the delivery, acceptance, performance,
default or enforcement of this Note, and assent to any extension or postponement of the time of payment or any other indulgence,
to any substitution, exchange or release of collateral available to Holder, if any, and to the addition or release of any other
party or person primarily or secondarily liable.

 

16.         
If from any circumstance any holder of this Note shall ever receive Interest or any other charges constituting interest,
or adjudicated as constituting interest, the amount, if any, which would exceed the Maximum Rate shall be applied to the reduction
of the Principal amount owing on this Note, and not to the payment of interest; or if such excessive interest exceeds the unpaid
balance of Principal hereof, the amount of such excessive interest that exceeds the unpaid balance of Principal hereof shall be
refunded to Company. In determining whether or not the interest paid or payable exceeds the Maximum Rate, to the extent permitted
by applicable law (i) any non-Principal payment shall be characterized as an expense, fee or premium rather than as Interest; and
(ii) all Interest at any time contracted for, charged, received or preserved in connection herewith shall be amortized, prorated,
allocated and spread in equal parts during the period of the full stated term of this Note. The term “Maximum Rate”
shall mean the maximum rate of interest allowed by applicable federal or state law.

 

17.         
This Note may be executed in several counterparts, each of which is an original. It shall not be necessary in making
proof of this Note or any counterpart hereof to produce or account for any of the other counterparts. A copy of this Note signed
by one party and faxed or scanned and emailed to another party (as a PDF or similar image file) shall be deemed to have been executed
and delivered by the signing party as though an original. A photocopy or PDF of this Note shall be effective as an original for
all purposes.

 

18.         
It is the intention of the parties hereto that the terms and provisions of this Note are to be construed in accordance
with and governed by the laws of the State of Texas, except as such laws may be preempted by any federal law controlling the rate
of Interest which may be charged on account of this Note. The parties hereby consent and agree that, in any actions predicated
upon this Note, venue is properly laid in Texas and that the Circuit Court in and for Harris County, Texas, shall have full subject
matter and personal jurisdiction over the parties to determine all issues arising out of or in connection with the execution and
enforcement of this Note.

 

19.         
The term “Company” as used herein in every instance shall include Company’s successors,
legal representatives and permitted assigns, including all subsequent grantees, either voluntarily by act of Company or involuntarily
by operation of law and shall denote the singular and/or plural and the masculine and/or feminine and natural and/or artificial
persons, whenever and wherever the contexts so requires or properly applies. The term “Holder” as used
herein in every instance shall include Holder’s successors, legal representatives and assigns, as well as all subsequent
assignees and endorsees of this Note, either voluntarily by act of the parties or involuntarily by operation of law. Captions and
paragraph headings in this Note are for convenience only and shall not affect its interpretation. As used herein, words in the
singular shall be held to include the plural and vice versa, and words of one gender shall be held to include the other gender
as the context requires.

 

    
Page 4 of 6
Promissory Note

     

    

 

20.          Holder
may not assign or pledge this Note and its rights hereunder without the prior written approval of Company which may be
withheld in Company’s sole discretion. Company may not assign its obligations hereunder, whether by operation of law
or otherwise, without the prior written approval of Holder which may be withheld in Holder’s sole discretion.

 

21.         
Anything else in this Note to the contrary notwithstanding, in any action arising out of this Agreement, the prevailing
party shall be entitled to collect from the non-prevailing party all of its attorneys’ fees. For the purposes of this Note,
the party who receives or is awarded a substantial portion of the damages or claims sought in any proceeding shall be deemed the
“prevailing” party and attorneys’ fees shall mean the reasonable fees charged by an attorney or
a law firm for legal services and the services of any legal assistants, and costs of litigation, including, but not limited to,
fees and costs at trial and appellate levels.

 

22.         
If any term or other provision of this Note is invalid, illegal or incapable of being enforced by any rule of law, or
public policy, all other conditions and provisions of this Note shall nevertheless remain in full force and effect so long as the
economic or legal substance of the transactions contemplated hereby is not affected in any manner adverse to any party. Upon such
determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate
in good faith to modify this Note so as to affect the original intent of the parties as closely as possible in an acceptable manner
to the end that transactions contemplated hereby are fulfilled to the extent possible.

 

23.         
No modification, amendment, addition to, or termination of this Note, nor waiver of any of its provisions, shall be
valid or enforceable unless in writing and signed by all the parties hereto.

 

24.         
The Note constitutes the entire agreement of the parties regarding the matters contemplated herein, or related thereto,
and supersedes all prior and contemporaneous agreements, and understandings of the parties in connection therewith.

 

[Remainder of page left intentionally blank.
Signature page follows.]

 

    
Page 5 of 6
Promissory Note

     

    

 

IN
WITNESS WHEREOF, Company has duly executed this Promissory Note as of July 8, 2019, with an Effective Date as provided above.

 

	 	“Company”	 
	 	 	 
	 	Lineal Star Holdings, LLC	 
	 	 	 	 
	 	By:	/s/ Timothy J. Connolly	 
	 	 	 
	 	Its: 	CEO	 

 

	 	Printed Name: 	Timothy J. Connolly

 

    
Page 6 of 6
Promissory Note

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00297-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00297-of-00352.parquet"}]]