UNIVERSAL PROPERTY DEVELOPMENT & ACQUISITION CORP
EXHIBIT 10.2
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<DESCRIPTION>EXHIBIT 10.2
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<a name="_iDocIDField_3"></a><a name="_iDocIDField_4"></a><font face="Arial" size="2">Exhibit 10.2</font></p align="right">
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<br><font face="Arial" size="2">THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE </font><br><font face="Arial" size="2">SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE </font><br><font face="Arial" size="2">SECURITIES ACT OF 1933, AS AMENDED (THE &#8220;SECURITIES ACT&#8221;), AND, ACCORDINGLY, MAY  NOT BE OFFERED OR </font><br><font face="Arial" size="2">SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE  SECURITIES ACT OR </font><br><font face="Arial" size="2">PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT  TO, THE REGISTRATION </font><br><font face="Arial" size="2">REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE  STATE SECURITIES LAWS AS </font><br><font face="Arial" size="2">EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH  EFFECT, THE SUBSTANCE OF WHICH </font><br><font face="Arial" size="2">SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY.  THESE SECURITIES MAY BE PLEDGED IN CONNECTION </font><br><font face="Arial" size="2">WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.</font><br></p>
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<font face="Arial" size="2">Original Issue Date: December 11, 2007</font></p>
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<font face="Arial" size="2">$5,500,000</font></p align="right">
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<font face="Arial" size="2"><b>SENIOR SECURED TERM PROMISSORY NOTE</b></font></p align="center">
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<font face="Arial" size="2"><b>DUE DECEMBER 11, 2010</b></font></p align="center">
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<br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;THIS NOTE is the duly authorized and issued Senior Secured Term Promissory Note of <b>Continental Fuels, Inc.</b>, a </font><br><font face="Arial" size="2">Nevada corporation whose principal place of business is located at 9901 Interstate Highway 10 West, Suite 800, San Antonio, TX </font><br><font face="Arial" size="2">78230 (the &#8220;<u>Company</u>&#8221;), designated as its Senior Secured Term Promissory Note, due on December 11, 2010 (this &#8220;<u>Note</u>&#8221;).</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FOR VALUE RECEIVED, the Company promises to pay to <b>Sheridan Asset Management, LLC</b> or its assigns (the </font><br><font face="Arial" size="2">&#8220;<u>Holder</u>&#8221;), the principal sum of $5,500,000 (&#8220;<u>Principal Amount</u>&#8221;), together with accrued, unpaid interest thereon from time to time </font><br><font face="Arial" size="2">outstanding at the rates and on the dates hereinafter described.  This Note is subject to the following additional provisions:</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>Section 1.</u>	<u>Definitions</u>.  For the purposes hereof, in addition to the terms defined elsewhere in this Note: (a) </font><br><font face="Arial" size="2">capitalized terms not otherwise defined herein have the meanings given to such terms in the Loan Agreement, and (b) the following </font><br><font face="Arial" size="2">terms shall have the following meanings:</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&#8220;<u>Change of Control Transaction</u>&#8221; means the occurrence after the date hereof, of any of (i) an acquisition after the </font><br><font face="Arial" size="2">date hereof by  an individual or legal entity or &#8220;group&#8221; (as described in Rule 13d-5(b)(1) promulgated under the Exchange Act) of </font><br><font face="Arial" size="2">effective  control (whether through legal or beneficial ownership of capital stock of the Company, by contract or otherwise) of in </font><br><font face="Arial" size="2">excess of  50% of the voting securities of the Company (other than UPDA or any of its Subsidiaries), (ii) a replacement at one time </font><br><font face="Arial" size="2">or  within a three-year period of more than one-half of the members of the Company&#8217;s board of directors which is not approved by a  </font><br><font face="Arial" size="2">majority of those individuals who are members of the board of directors on the date hereof (or by those individuals who are  serving </font><br><font face="Arial" size="2">as members of the board of directors on any date whose nomination to the board of directors was approved by a majority  of the </font><br><font face="Arial" size="2">members of the board of directors who are members on the date hereof), or (iii) the execution by the Company of an  agreement to </font><br><font face="Arial" size="2">which the Company is a party or by which it is bound, providing for any of the events set forth above in (i) or (ii).</font><br><br></p align="right">
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<br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&#8220;<u>Collateral</u>&#8221; shall have the meaning given to such term in the Security Agreement.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&#8220;<u>Controlled Account</u>&#8221; means an account of a Loan Party maintained with a bank which has executed a deposit </font><br><font face="Arial" size="2">account control agreement with the Holder which satisfies the requirements of Section 9-104(a)(2) of the UCC with respect to such </font><br><font face="Arial" size="2">account as contemplated by Section 4(f) of the Security Agreement.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&#8220;<u>Default Interest</u>&#8221; shall have the meaning set forth in section 3(d) to this Note.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	 &#8220;<u>EBITDA</u>&#8221; means, for any period, Net Income for such period plus, to the extent deducted in determining such </font><br><font face="Arial" size="2">Net Income, Interest Expense, taxes, depreciation, amortization and non-cash charges for such period.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	 &#8220;<u>Event of Default</u>&#8221; shall have the meaning set forth in Section 7.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	 &#8220;<u>Exchange Act</u>&#8221; means the Securities Exchange Act of 1934, as amended.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	 &#8220;<u>Geer</u>&#8221; shall mean Geer Tank Trucks, Inc., a Texas corporation.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	"<u>Interest Expense</u>", as applied to the Company and its Subsidiaries, means for any period, the amount of interest </font><br><font face="Arial" size="2">paid or due on indebtedness by the Company and its Subsidiaries for such period, determined in accordance with GAAP.  </font><br><br><a name="_DV_C39"></a><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	</font><font face="Arial" size="2"> &#8220;<u>Junior Subordinated Obligations</u>&#8221; shall have the meaning set forth in the Subordination Agreement. </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	 &#8220;<u>Loan Agreement</u>&#8221; means that certain Loan Agreement, dated as of December 11, 2007, by and among the </font><br><font face="Arial" size="2">Company, the Holder, and the Guarantors party thereto, as amended, modified or supplemented from time to time in accordance </font><br><font face="Arial" size="2">with its terms.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&#8220;<u>Maturity Date</u>&#8221; means December 11, 2010 or such earlier date as this Note is required to be repaid as provided in </font><br><font face="Arial" size="2">this Note or  the Prepayment Date.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	"<u>Net Income</u>" means net income of the Company and its Subsidiaries on a consolidated basis determined in </font><br><font face="Arial" size="2">accordance with GAAP. </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&#8220;<u>Original Issue Date</u>&#8221; means the date of the first issuance of this Note regardless of the number of transfers of this </font><br><font face="Arial" size="2">Note and regardless of the number of instruments which may be issued to evidence this Note.  The Original Issue Date is </font><br><font face="Arial" size="2">sometimes referred to in this Note as the Closing Date.</font><br><br><a name="_DV_C36"></a><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	</font><font face="Arial" size="2">&#8220;<u>Permitted Indebtedness</u>&#8221; means (a) Junior Subordinated Obligations, and (b) indebtedness resulting from (i) </font><br><font face="Arial" size="2">acquiring goods, supplies, or merchandise on normal trade credit; (ii) endorsing negotiable instruments received in the usual course </font><br><font face="Arial" size="2">of business; (iii) obtaining surety bonds in the usual course of business; or (iv) liabilities, lines of credit and leases in existence on </font><br><font face="Arial" size="2">the date of this Agreement disclosed in writing to the Holder or in the Company&#8217;s most recent financial statement; excluding the </font><br><font face="Arial" size="2">outstanding indebtedness to Inter National Bank.</font><br><br></p align="right">
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<font size="2" color="#000080">2</font></p>
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<br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&#8220;<u>Permitted Liens</u>&#8221; means (a)	liens and security interests in favor of the Holder; (b)  liens for taxes not yet </font><br><font face="Arial" size="2">due; (c)liens outstanding on the date of this Note disclosed in Schedule 2 attached hereto; (d) additional purchase money security </font><br><font face="Arial" size="2">interests in assets acquired after the date of this Note. </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>Section 2.</u>	<u>Loan Agreement</u>.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	This Note is the Senior Secured Term Promissory Note referred to in, and is entitled to the benefits of, the Loan </font><br><font face="Arial" size="2">Agreement.  The Loan Agreement, among other things, provides for the making of a term loan (the &#8220;<u>Term Loan</u>&#8221;) by the Holder to </font><br><font face="Arial" size="2">the Company, in the U.S. Dollar amount set forth therein, the indebtedness of the Company resulting from such Term Loan being </font><br><font face="Arial" size="2">evidenced by this Note.  All obligations under this Note are secured by the Transaction Documents and the Collateral and entitled to </font><br><font face="Arial" size="2">the benefits thereof.  </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>Section 3.	Payment of Principal and Interest</u>.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	a)	<u>Payment of Principal</u>.  The outstanding Principal Amount under the Loan and this Note shall be due and </font><br><font face="Arial" size="2">payable by the Company on the first Business Day of each calendar month (each a &#8220;<u>Monthly Payment Date</u>&#8221;), beginning on January </font><br><font face="Arial" size="2">11, 2008, and on the Maturity Date, in the amounts set forth below: </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&nbsp;	i.	The first six Monthly Payment Dates commencing on January 1, 2008 and ending on June 1, </font><br><font face="Arial" size="2">2008:  $100,000 on each such Monthly Payment Date;</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&nbsp;	ii.	The next 30 Monthly Payment Dates commencing on July 1, 2008 and ending on December 1, </font><br><font face="Arial" size="2">2010:  $150,000 on each such Monthly Payment Date;</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&nbsp;	iii.	Maturity Date: $400,000. </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	b)	<u>Interest Rate</u>.  The Company shall pay interest on the unpaid Principal Amount of the Loan, from the </font><br><font face="Arial" size="2">Original Issue Date until such principal amount shall be paid in full, at the rate of 15% per annum. Interest shall be computed daily </font><br><font face="Arial" size="2">based on a year of 360 days and the actual days elapsed (including the first day but excluding the last day) in the period for which </font><br><font face="Arial" size="2">interest is payable and shall be payable monthly in arrears on each Monthly Payment Date beginning on January 1, 2008, and on </font><br><font face="Arial" size="2">the Maturity Date, in cash.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	(c)	<u>PIK Interest</u>.  In addition to the cash interest payable by the Company to the Holder as described above </font><br><font face="Arial" size="2">in Section 3(b), the Company shall pay to the Holder interest, at the rate of 5% per annum, on the principal amount outstanding from </font><br><font face="Arial" size="2">time to time hereunder (&#8220;<u>PIK Amount</u>&#8221;) on the Maturity Date.  The interest hereunder will be computed daily on a year of 360 days </font><br><font face="Arial" size="2">and the actual days elapsed (including the first day but excluding the last day) in the period for which interest is payable.  The PIK </font><br><font face="Arial" size="2">Amount shall be payable on the Maturity Date, at the Holder&#8217;s option either, in (1) cash or (2) in-kind by delivery of such number of </font><br><font face="Arial" size="2">shares of the Company&#8217;s Common Stock determined by dividing (x) the PIK Amount accrued and unpaid in cash as of the Maturity </font><br><font face="Arial" size="2">Date by (y) 85% of an amount equal to the closing price of the Company&#8217;s Common Stock on the Original Issue Date.</font><br><br></p align="right">
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<font size="2" color="#000080">3</font></p>
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<br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>Section 4.</u>	<u>Default Interest</u>.  </font><a name="_DV_C78"></a><font face="Arial" size="2">If an Event of Default has occurred that results in the eventual acceleration of this Note, then</font><a name="_DV_C80"></a><a name="_DV_M69"></a><font face="Arial" size="2"> default interest shall </font><a name="_DV_C82"></a><font face="Arial" size="2">accrue on the unpaid principal amount of all Advances at a rate of 3% per annum from the occurrence of </font><br><font face="Arial" size="2">such Event of Default in addition to the interest rate otherwise payable pursuant to Section 3(b) of this Note </font><a name="_DV_M71"></a><font face="Arial" size="2"> (or such lower </font><br><font face="Arial" size="2">maximum amount of interest permitted to be charged under applicable law) (&#8220;<u>Default Interest</u>&#8221;)</font><a name="_DV_C83"></a><font face="Arial" size="2">.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	a)	<u>Optional Prepayment</u>.  So long as the cumulative amount of cash interest paid under this Note, including </font><br><font face="Arial" size="2">on the date of such  prepayment (&#8220;<u>Prepayment Date</u>&#8221;), shall be not less than $1,250,000 (&#8220;<u>Interest Threshold Amount</u>&#8221;), exclusive of </font><br><font face="Arial" size="2">the accumulated  PIK Amount, the Company shall have the right to prepay, in cash, all, but not less than all, of the amount </font><br><font face="Arial" size="2">outstanding under this  Note, upon not less than ten (10) Business Days written notice to the Holder by paying to the Holder, in </font><br><font face="Arial" size="2">immediately available  funds, an amount equal to 100% of the then outstanding Principal Amount thereof and all accrued and </font><br><font face="Arial" size="2">unpaid cash interest and  other amounts, costs, expenses due in respect of this Note.  If the Prepayment Date occurs prior to the </font><br><font face="Arial" size="2">last day of a calendar  month, Holder shall receive a full month of interest as though such pre-payment were made on the last day of </font><br><font face="Arial" size="2">such month.   Notwithstanding the foregoing, if the Company has not paid the Interest Threshold Amount, the Company may </font><br><font face="Arial" size="2">nonetheless  prepay this Note by paying to the Holder the amount provided above, and in addition, by also paying the Holder the </font><br><font face="Arial" size="2">difference  between the cash interest paid by the Company by the Prepayment Date and the Interest Threshold Amount.  The PIK </font><br><font face="Arial" size="2">Amount  required to be paid by the Company upon prepayment of this Note shall be equal to the amount that would have been </font><br><font face="Arial" size="2">otherwise  payable if the Loan was held until the Maturity Date in accordance with the terms set forth <u>in Section 3(a)</u> above and </font><br><font face="Arial" size="2">shall be payable on the Prepayment Date, at the Holder&#8217;s option, either in cash or in kind as provided in <u>Section 3(c)</u> </font><br><font face="Arial" size="2">above.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>Section 5.</u>	<u>Registration of Transfers and Exchanges</u>. </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	a)	<u>Different Denominations</u>.  This Note is exchangeable for an equal aggregate principal amount of notes of </font><br><font face="Arial" size="2">different authorized  denominations, as requested by the Holder surrendering the same.  No service charge will be made for such </font><br><font face="Arial" size="2">registration of transfer or exchange.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	b)	<u>Reliance on Note Register</u>.  Prior to due presentment to the Company for transfer of this Note, the </font><br><font face="Arial" size="2">Company and any agent of the  Company may treat the Person in whose name this Note is duly registered on the note register as </font><br><font face="Arial" size="2">the owner hereof for the purpose  of receiving payment as herein provided and for all other purposes, whether or not this Note is </font><br><font face="Arial" size="2">overdue, and neither the Company  nor any such agent shall be affected by notice to the contrary.</font><br><br></p align="right">
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<font size="2" color="#000080">4</font></p>
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<br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>Section 6.</u>	<u>Negative Covenants</u>.  Other than pursuant to the terms of or as contemplated in any Transaction </font><br><font face="Arial" size="2">Document, so long as any  portion of this Note is outstanding, the Company will not and will not permit any of its Subsidiaries to </font><br><font face="Arial" size="2">directly or indirectly:</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	a)	enter into, create, incur, assume or suffer to exist any indebtedness or liens of any kind (other than, </font><br><font face="Arial" size="2">Permitted Indebtedness and  Permitted Liens) on or with respect to any of its property or assets now owned or hereafter acquired or </font><br><font face="Arial" size="2">any interest thereon or any  income or profits therefrom regardless of whether such indebtedness or liens are senior to, <u>pari</u> <u>passu</u> </font><br><font face="Arial" size="2">with or subordinated to in  any respect, the Company&#8217;s obligations under this Note;</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	b)	amend its certificate of incorporation, bylaws or its charter documents so as to adversely affect any rights </font><br><font face="Arial" size="2">of the Holder; </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	c)	repay, repurchase, redeem or offer to repay, repurchase or otherwise acquire or make any dividend or </font><br><font face="Arial" size="2">distribution in respect of  any of its Common Stock, or other equity securities other than such repayments, repurchases, offers, </font><br><font face="Arial" size="2">acquisitions, dividends or  distributions from the Company&#8217;s wholly-owned Subsidiaries to the Company; </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	d)	engage in any transactions with any officer, director, employee or any affiliate of the Company, including </font><br><font face="Arial" size="2">any contract,  agreement or other arrangement providing for the furnishing of services to or by (other than any employment, </font><br><font face="Arial" size="2">compensation or  indemnification agreements), providing for rental of real or personal property to or from, or otherwise requiring </font><br><font face="Arial" size="2">payments to or  from any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, </font><br><font face="Arial" size="2">director, or  any such employee has a substantial interest or is an officer, director, trustee or partner, in each case in excess of </font><br><font face="Arial" size="2">$10,000; </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	e)	sell, transfer or otherwise dispose of any of its assets on terms where such assets may be leased to or </font><br><font face="Arial" size="2">re-acquired or acquired by  the Company or any of its Subsidiaries;</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	f)	dispose, in a single transaction, or in a series of transactions all or a substantial part of its assets other </font><br><font face="Arial" size="2">than cash, cash equivalents,  inventory and obsolete and worn out equipment, in each case in the ordinary course of business; </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	g)	issue to any Person (other than the Company or any of its Subsidiaries) more than $250,000, in the </font><br><font face="Arial" size="2">aggregate, (based on fair  market value at the time of issuance) in Common Stock or securities exchangeable for, convertible into or </font><br><font face="Arial" size="2">exercisable for  Common Stock; </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	h)	incur any expenditures, except in accordance with its schedule of required signatories for expenditures, </font><br><font face="Arial" size="2">a copy of which is forth  on Schedule 1.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	i)	 (a) permit Timothy Brink to cease serving as Chief Executive Officer, or to otherwise cease to be the </font><br><font face="Arial" size="2">principal operating officer with final decision making authority for the Company; or (b) fail to submit to Holder notice and a present </font><br><font face="Arial" size="2">plan of repayment that is satisfactory to the Holder within sixty (60) days from the date Timothy Brink ceases to serve as Chief </font><br><font face="Arial" size="2">Executive Officer, or to otherwise ceases to be the principal operating officer with final decision making authority for the Company if </font><br><font face="Arial" size="2">such occurrence is a result of death, disability or termination for cause;</font><br><br></p align="right">
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<font size="2" color="#000080">5</font></p>
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<br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	j)	create any subsidiary (other than Geer) without the prior consent of the Holder;</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	k)	consummate any merger or acquisition (other than Geer) except on terms satisfactory to Holder; </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	l)	conduct business in any entity other than the Company or its Subsidiaries; or</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	m)	transfer assets to a subsidiary that is not a Subsidiary.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>Section 7.</u> 	<u>Other Covenants</u>.   So long as any portion of this Note is outstanding, the Company will or cause its </font><br><font face="Arial" size="2">Subsidiaries to comply with the following covenants:</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>Section 8.</u> 	<u>Financial Reporting</u>.  The Company shall comply with the reporting requirements of the Exchange Act, </font><br><font face="Arial" size="2">shall timely file all annual, quarterly and other reports under the Exchange Act and shall provide such monthly financial reports or </font><br><font face="Arial" size="2">other information as the Holder shall reasonably request on reasonable notice </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	a)	<u>Net Worth</u>.  As of the last day of each fiscal quarter of the Company, the Company&#8217;s and its Subsidiaries&#8217; </font><br><font face="Arial" size="2">total consolidated assets as of such fiscal quarter end shall exceed the Company&#8217;s and its Subsidiaries&#8217; total consolidated  liabilities </font><br><font face="Arial" size="2">as of such fiscal quarter ends, in each case, determined in accordance with GAAP.  </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	b)	<u>EBITDA</u>.  As of the last day of each fiscal quarter of the Company, EBITDA of the Company and its </font><br><font face="Arial" size="2">Subsidiaries on a consolidated basis for the fiscal quarter then ended shall not be less than $500,000.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	c)	<u>Cash Management</u>.  The Company shall cause all cash and cash equivalents of the Company to be </font><br><font face="Arial" size="2">promptly deposited to and maintained in one or more Controlled Accounts until such cash and cash equivalents are disbursed as </font><br><font face="Arial" size="2">permitted by the Loan Documents.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	d)	<u>Operating Reporting</u>.  The Company shall provide Holder with monthly operating activity reports for Geer </font><br><font face="Arial" size="2">and the Company, each of which shall be delivered to the Holder by no later than the 15th day of each calendar month, containing </font><br><font face="Arial" size="2">the following information for the prior calendar month and any other information the Holder may reasonably request from time to </font><br><font face="Arial" size="2">time: </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&nbsp;	(i)	for Geer: (i) the number of barrels sold of each of crude oil and condensate, (ii) major </font><br><font face="Arial" size="2">equipment inventory changes, (iii) major investments/divestments, (iv) new clients acquired, (v) status of any account 90 days past </font><br><font face="Arial" size="2">due and (vi) any material environmental issue affecting operating viability; and</font><br><br></p align="right">
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<br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&nbsp;	(ii)	for the Company: (i) daily deliveries and off-takes in barrels by supplier or purchaser and by </font><br><font face="Arial" size="2">product, (ii) leasehold or capital improvements to Brownsville facility, and (iii) any new contracts in development or executed.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>Section 7.</u>	<u>Events of Default</u>.  </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	a)	&#8220;<u>Event of Default</u>&#8221;, wherever used herein, means any one of the following events (whatever the reason </font><br><font face="Arial" size="2">and whether it shall be voluntary or involuntary or effected by operation of law or pursuant to any judgment, decree or order of any </font><br><font face="Arial" size="2">court, or any order, rule or regulation of any administrative or governmental body):</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&nbsp;	(i)	any default in the payment of (A) the principal of this Note, or (B) cash interest (including </font><br><font face="Arial" size="2">Default Interest) on this Note, as and when the same shall become due and payable (whether on the Maturity Date or by </font><br><font face="Arial" size="2">acceleration or otherwise) which default, is not cured, within two (2) Business Days;</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&nbsp;	(ii)	the Company, any of its Subsidiaries or any Guarantor shall fail to observe or perform any other </font><br><font face="Arial" size="2">covenant or agreement contained in this Note or any of the other Transaction Documents which failure is not cured, if subject to </font><br><font face="Arial" size="2">cure, within thirty (30) calendar days;</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&nbsp;	(iii)	a default or event of default (subject to any grace or cure period provided for in the applicable </font><br><font face="Arial" size="2">agreement, document or instrument) shall occur under any of the Transaction Documents;</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&nbsp;	(iv)	any representation or warranty made herein, in any other Transaction Document, in any written </font><br><font face="Arial" size="2">statement pursuant hereto or thereto, or in any other report, financial statement or certificate made or delivered to the Holder or any </font><br><font face="Arial" size="2">other holder of Notes shall be untrue or incorrect in any material respect as of the date when made or deemed made;</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&nbsp;	(v)	 (i) the Company, any of its Subsidiaries or any Guarantor shall commence, or there shall be </font><br><font face="Arial" size="2">commenced against the Company,  any such Subsidiary or any Guarantor, a case or other similar proceeding under any applicable </font><br><font face="Arial" size="2">bankruptcy or insolvency laws as  now or hereafter in effect or any successor thereto which remain undismissed for a period of 60 </font><br><font face="Arial" size="2">days, or the Company, any  Subsidiary or any Guarantor commences any other proceeding under any reorganization, arrangement, </font><br><font face="Arial" size="2">adjustment of debt, relief  of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction whether now or hereafter </font><br><font face="Arial" size="2">in effect relating to  the Company, any Subsidiary thereof, or any Guarantor; (ii) the Company, any Subsidiary thereof, or any </font><br><font face="Arial" size="2">Guarantor is  adjudicated by a court of competent jurisdiction insolvent or bankrupt; or any order of relief or other order approving </font><br><font face="Arial" size="2">any such  case or proceeding is entered; or (iii) the Company, any Subsidiary thereof, or any Guarantor suffers any appointment of </font><br><font face="Arial" size="2">any  custodian or the like for it or any substantial part of its property which continues undischarged or unstayed for a period of 60  </font><br><font face="Arial" size="2">days; or (iv) the Company, any Subsidiary thereof, or any Guarantor makes a general assignment for the benefit of creditors; or  (v) </font><br><font face="Arial" size="2">the Company, any Subsidiary or any Guarantor shall fail to pay, or shall state that it is unable to pay, or shall be unable to pay,  its </font><br><font face="Arial" size="2">debts generally as they become due; or (vi) the Company, any Subsidiary thereof, or any Guarantor shall call a meeting of its  </font><br><font face="Arial" size="2">creditors with a view to arranging a composition, adjustment or restructuring of its debts; or (vii) the Company, any Subsidiary  </font><br><font face="Arial" size="2">thereof or any Guarantor shall by any act or failure to act expressly indicate its consent to, approval of or acquiescence in any of  </font><br><font face="Arial" size="2">the foregoing; or (viii) any corporate or other action is taken by the Company, any Subsidiary thereof or any Guarantor for the </font><br><font face="Arial" size="2">purpose of effecting any of the foregoing;</font><br></p align="right">
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<br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&nbsp;	(vi)	the Company, any Subsidiary thereof, or any Guarantor shall default in any of its obligations </font><br><font face="Arial" size="2">under  any mortgage, credit  agreement or other facility, indenture agreement, factoring agreement or other instrument under which </font><br><font face="Arial" size="2">there may be issued, or by  which there may be secured or evidenced any indebtedness for borrowed money or money due under </font><br><font face="Arial" size="2">any long-term leasing or  factoring arrangement of the Company in an amount exceeding $250,000, whether such indebtedness </font><br><font face="Arial" size="2">now exists or shall  hereafter be created and such default shall result in such indebtedness becoming or being declared due and </font><br><font face="Arial" size="2">payable prior to the  date on which it would otherwise become due and payable; </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&nbsp;	(vii)	the Company, any Subsidiary thereof, or any Guarantor shall have experienced a Material </font><br><font face="Arial" size="2">Adverse Effect; </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&nbsp;	(viii)	the occurrence of any Change of Control Transaction; and</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	&nbsp;	(ix)	the Company shall fail to provide a key man insurance policy, satisfactory to the Holder, for </font><br><font face="Arial" size="2">Timothy Brink by March 30, 2008.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	b)	<u>Remedies Upon Event of Default</u>. If any Event of Default occurs, the full principal amount of this Note, </font><br><font face="Arial" size="2">together with interest  and other amounts owing in respect thereof, to the date of acceleration shall become, at the Holder&#8217;s election, </font><br><font face="Arial" size="2">immediately due  and payable in cash.    The Holder need not provide and the Company hereby waives any presentment, demand, </font><br><font face="Arial" size="2">protest or other  notice of any kind, and the Holder may immediately and without expiration of any grace period enforce any and all </font><br><font face="Arial" size="2">of its rights  and remedies hereunder and all other remedies available to it under applicable law.  Such declaration may be </font><br><font face="Arial" size="2">rescinded and  annulled by Holder at any time prior to payment hereunder and the Holder shall have all rights as a Note holder until </font><br><font face="Arial" size="2">such time, if  any, as the full payment under this Section shall have been received by it.  No such rescission or annulment shall </font><br><font face="Arial" size="2">affect any subsequent Event of Default or impair any right consequent thereon.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u>Section 8.</u>	<u>Miscellaneous</u>.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	a)	<u>Notices</u>.  Any and all notices or other communications or deliveries to be provided by the Holder </font><br><font face="Arial" size="2">hereunder  shall be in writing  and delivered personally, by facsimile, sent by a nationally recognized overnight courier service, </font><br><font face="Arial" size="2">addressed to the Company, at  the address set forth above, facsimile number<b> (</b>914) 285-0071, Attn: Timothy Brink,<b> </b>or such other </font><br><font face="Arial" size="2">address or facsimile number as  the Company may specify for such purposes by notice to be delivered in accordance with this </font><br><font face="Arial" size="2">Section.  Any and all notices or  other communications or deliveries to be provided by the Company hereunder shall be in writing </font><br><font face="Arial" size="2">and delivered personally, by  facsimile, or sent by a nationally recognized overnight courier service addressed to the Holder at 1025 </font><br><font face="Arial" size="2">Westchester Avenue, Suite  311, White Plains, NY 10604, facsimile number (914) 285-0071, Attn:  Christopher J. Morrissey.  Any </font><br><font face="Arial" size="2">notice or other  communication or deliveries hereunder shall be deemed given and effective on the earliest of (i) the date of </font><br><font face="Arial" size="2">transmission, if such  notice or communication is delivered via facsimile at the facsimile telephone number specified in this Section </font><br><font face="Arial" size="2">prior to 5:30 p.m.  (New York City time) on a Business Day, (ii) the date after the date of transmission, if such notice or </font><br><font face="Arial" size="2">communication is delivered  via facsimile at the facsimile telephone number specified in this Section later than 5:30 p.m. (New York </font><br><font face="Arial" size="2">City time) on such date  or if the date of such transmission is not a Business Day, (iii) the second Business Day following the date of </font><br><font face="Arial" size="2">mailing, if sent by  nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such notice is </font><br><font face="Arial" size="2">required to be  given.</font><br><br></p align="right">
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<br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	b)	<u>Absolute Obligation</u>. Except as expressly provided herein, no provision of this Note shall alter or impair </font><br><font face="Arial" size="2">the obligation of the Company,  which is absolute and unconditional, to pay the principal of, accrued interest on, and other amounts </font><br><font face="Arial" size="2">payable under, this Note at the time, place, and rate, and in the coin or currency, herein prescribed.  This Note is a direct debt </font><br><font face="Arial" size="2">obligation of the Company.  </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	c)	<u>Lost or Mutilated Note</u>.  If this Note shall be mutilated, lost, stolen or destroyed, the Company shall </font><br><font face="Arial" size="2">execute and deliver, in exchange and  substitution for and upon cancellation of a mutilated Note, or in lieu of or in substitution for a </font><br><font face="Arial" size="2">lost, stolen or destroyed Note, a new Note for  the Principal Amount of this Note so mutilated, lost, stolen or destroyed but only upon </font><br><font face="Arial" size="2">receipt of evidence of such loss, theft or destruction of such Note, and of the ownership hereof, and indemnity, if requested, all </font><br><font face="Arial" size="2">reasonably satisfactory to the Company.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	d)	<u>Security Interest</u>.  This Note is a direct debt obligation of the Company, is guarantied by the Guarantors </font><br><font face="Arial" size="2">pursuant to the Guaranties and, pursuant to the Security Agreement, is secured by a perfected security interest in all of the assets </font><br><font face="Arial" size="2">of the Company and its Subsidiaries.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	e)	<u>Governing Law</u>.  All questions concerning the construction, validity, enforcement and interpretation of </font><br><font face="Arial" size="2">this Note shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without </font><br><font face="Arial" size="2">regard to the principles of conflicts of law thereof.  Each party agrees that all legal proceedings concerning the interpretations, </font><br><font face="Arial" size="2">enforcement and defense of the transactions contemplated by any of the Transaction Documents (whether brought against a party </font><br><font face="Arial" size="2">hereto or its respective affiliates, directors, officers, shareholders, employees or agents) shall be commenced in the state and </font><br><font face="Arial" size="2">federal courts sitting in the City of New York, Borough of Manhattan (the &#8220;<u>New York Courts</u>&#8221;).  Each party hereto hereby irrevocably </font><br><font face="Arial" size="2">submits to the exclusive jurisdiction of the New York Courts for the adjudication of any dispute hereunder or in connection herewith </font><br><font face="Arial" size="2">or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the </font><br><font face="Arial" size="2">Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it </font><br><font face="Arial" size="2">is not personally subject to the jurisdiction of any such court, or such New York Courts are improper or inconvenient venue for such </font><br><font face="Arial" size="2">proceeding.  Each party hereby irrevocably waives personal service of process and consents to process being served in any such </font><br><font face="Arial" size="2">suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to </font><br><font face="Arial" size="2">such party at the address in effect for notices to it under this Note and agrees that such service shall constitute good and sufficient </font><br><font face="Arial" size="2">service of process and notice thereof.  Nothing contained herein shall be deemed to limit in any way any right to serve process in </font><br><font face="Arial" size="2">any manner permitted by law. Each party hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any </font><br><font face="Arial" size="2">and all right to trial by jury in any legal proceeding arising out of or relating to this Note or the transactions contemplated hereby. If </font><br><font face="Arial" size="2">either party shall commence an action or proceeding to enforce any provisions of this Note, then the prevailing party in such action </font><br><font face="Arial" size="2">or proceeding shall be reimbursed by the other party for its attorney&#8217;s fees and other costs and expenses incurred with the </font><br><font face="Arial" size="2">investigation, preparation and prosecution of such action or proceeding.</font><br><br></p align="right">
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<br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	f)	<u>Waiver of a Breach</u>.  Any waiver by the Company or the Holder of a breach of any provision of this Note </font><br><font face="Arial" size="2">shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of </font><br><font face="Arial" size="2">this Note or any provisions under the Transaction Document.  The failure of the Company or the Holder to insist upon strict </font><br><font face="Arial" size="2">adherence to any term of this Note on one or more occasions shall not be considered a waiver or deprive that party of the right </font><br><font face="Arial" size="2">thereafter to insist upon strict adherence to that term or any other term of this Note or any terms under the Revolving Note.  Any </font><br><font face="Arial" size="2">waiver must be in writing.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	g)	<u>Waiver of Presentment</u>.  The Company hereby waives presentation, demand, protest and notice of any </font><br><font face="Arial" size="2">kind.  No failure to exercise, and no delay in exercising, any rights hereunder on the part of the Holder shall operate as a waiver of </font><br><font face="Arial" size="2">such rights.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	h)	<u>Severability</u>.  If any provision of this Note is invalid, illegal or unenforceable, the balance of this Note </font><br><font face="Arial" size="2">shall remain in effect, and if any provision is inapplicable to any person or circumstance, it shall nevertheless remain applicable to </font><br><font face="Arial" size="2">all other persons and circumstances. </font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	i)	<u>Usury</u>.  To the extent it may lawfully do so, the Company hereby agrees not to insist upon or plead or in </font><br><font face="Arial" size="2">any manner whatsoever claim, and will resist any and all efforts to be compelled to take the benefit or advantage of, usury laws </font><br><font face="Arial" size="2">wherever enacted, now or at any time hereafter in force, in connection with any claim, action or proceeding that may be brought by </font><br><font face="Arial" size="2">the Holder in order to enforce any right or remedy under any Transaction Document.  Notwithstanding any provision to the contrary </font><br><font face="Arial" size="2">contained in any Transaction Document, it is expressly agreed and provided that the total liability of the Company under the </font><br><font face="Arial" size="2">Transaction Documents for payments in the nature of interest shall not exceed the maximum lawful rate authorized under applicable </font><br><font face="Arial" size="2">law (the &#8220;<u>Maximum Rate</u>&#8221;), and, without limiting the foregoing, in no event shall any rate of interest or default interest, or both of </font><br><font face="Arial" size="2">them, when aggregated with any other sums in the nature of interest that the Company may be obligated to pay under the </font><br><font face="Arial" size="2">Transaction Documents exceed such Maximum Rate.  It is agreed that if the maximum contract rate of interest allowed by law and </font><br><font face="Arial" size="2">applicable to the Transaction Documents is increased or decreased by statute or any official governmental action subsequent to the </font><br><font face="Arial" size="2">date hereof, the new maximum contract rate of interest allowed by law will be the Maximum Rate applicable to the Transaction </font><br><font face="Arial" size="2">Documents from the effective date forward, unless such application is precluded by applicable law.  If under any circumstances </font><br><font face="Arial" size="2">whatsoever, interest in excess of the Maximum Rate is paid by the Company to the Holder with respect to indebtedness evidenced </font><br><font face="Arial" size="2">by the Transaction Documents, such excess shall be applied by the Holder to the unpaid principal balance of any such </font><br><font face="Arial" size="2">indebtedness or be refunded to the Company, the manner of handling such excess to be at the Holder&#8217;s election.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	j)	<u>Next Business Day</u>.  Whenever any payment or other obligation hereunder shall be due on a day other </font><br><font face="Arial" size="2">than a Business Day, such payment shall be made on the next succeeding Business Day.</font><br><br></p align="right">
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<br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	k)	<u>Headings</u>.  The headings contained herein are for convenience only, do not constitute a part of this Note </font><br><font face="Arial" size="2">and shall not be deemed to limit or affect any of the provisions hereof.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;	l)	<u>Seniority</u>.  As of the Closing Date, no indebtedness or other equity of the Company, other than the Loans </font><br><font face="Arial" size="2">pursuant to the Loan Agreement, is senior to, or pari passu with, this Note in right of payment, whether with respect to interest or </font><br><font face="Arial" size="2">upon liquidation or dissolution, or otherwise, other than indebtedness secured by purchase money security interests (which is senior </font><br><font face="Arial" size="2">only as to underlying assets covered thereby) and capital lease obligations (which is senior only as to the property covered thereby).</font><br><br></p align="center">
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<br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, the Company has caused this Note to be duly executed by a duly authorized officer as of the </font><br><font face="Arial" size="2">date first above indicated.</font><br><br></p>
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<font face="Arial" size="2"><b>CONTINENTAL FUELS, INC.</b></font><br></p>
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<font face="Arial" size="2">By:&nbsp;&nbsp;__________________________________________</font></p>
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<font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name::</font></p>
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<font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Title</font></p>
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<font size="2" color="#000080">12</font></p>
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<font face="Arial" size="2"><b><u>Schedule 1</u></b></font></p align="center">
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<font face="Arial" size="2"><b>Required Signatories for Expenditures</b></font></p align="center">
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<br><font face="Arial" size="2">For the Company:</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i.	Expenditures of up to $300,000 per day require prior written consent of Timothy Brink, Josh Crescenzi or David </font><br><font face="Arial" size="2">Hinze.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii.	Expenditures between $300,000 and $500,000 per day require prior written consent of either Timothy Brink or </font><br><font face="Arial" size="2">Josh Crescenzi and David Hinze.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii.	Expenditures of $500,000 and more per day require prior written consent of the Holder.</font><br><br><br><font face="Arial" size="2">For Geer:</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i.	Expenditures of up to $100,000 per day require prior written consent of Lori Geer Smith.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii.	Expenditures of between $100,000 and $250,000 per day require prior written consent of both Lori Geer Smith </font><br><font face="Arial" size="2">and David Hinze; and.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii.	Expenditures of $250,000 and more per day require prior written consent of the Holder.</font><br><br><br><br></p align="right">
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<font size="2" color="#000080">13</font></p>
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<font face="Arial" size="2"><b><u>Schedule 2</u></b></font></p align="center">
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<font face="Arial" size="2"><b>Permitted Liens</b></font></p align="center">
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<br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i<b>.	</b>All liens disclosed to Holder pursuant to the lien search conducted in connection with the execution of the Loan </font><br><font face="Arial" size="2">Agreement.</font><br><br><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii.	All liens otherwise publicly disclosed.</font><br><br><br><br><br></p align="right">
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<font size="2" color="#000080">14</font></p>
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