2018-193-E Economic Dev - Seal the Seasons loan agreement

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DocuSign Envelope ID: F1811 E7D- C59B- 437F- A7A9 -1 E9E8DD91 D1 B LOAN AND SECURITY AGREEMENT THIS Loan and Security Agreement (the "Agreement ") is dated as of May 23, 2018, and is by and between Seal the Seasons, Inc., a North Carolina company (the "Borrower ") and Orange County (the "Fund ") The Borrower has applied for a loan from the Fund, and the Fund has agreed to make the loan. This Agreement sets out the terms of the loan, including the terms for payments and the security for the loan. NOW, THEREFORE, in consideration of the mutual promises set out in this Agreement, the parties agree as follows: PART ONE — AGREEMENT TO MAKE AND REPAY THE LOAN 1. The Fund will loan to the Borrower the sum of [$25,000.00] (the "Loan "). The Fund is making this loan by giving the Borrower a check for the full amount of the loan, reduced by the Fund's loan fee of [$50.00]. 2. The Borrower will repay the loan. The Borrower's obligation to repay the Loan will be represented by a promissory note (the "Note ") in substantially the form of Exhibit A, which the Borrower will execute and deliver to the Fund in exchange for the Loan proceeds. The Note will set out the terms of repayment, including payment dates and interest rates. 3. The Borrower will use the Loan for the purposes of its business (the "Business ") as described in its application to the Fund for this Loan. PART TWO - SECURITY FOR THE LOAN 4. To secure its obligations to the Fund under the Note and this Loan Agreement, Borrower grants to the Fund a security interest in the "Collateral" as described in Exhibit B. This Agreement is intended as, and constitutes, a security agreement within the meaning of the North Carolina Uniform Commercial Code (UCC) Financing Statement, with respect to the Collateral. The Borrower will execute and deliver to the Fund UCC Financing Statements and such other documents as the Fund may reasonably deem appropriate to secure the benefits of this Agreement. 5. To further secure the Borrower's obligations to the Fund under the Note and this Loan Agreement, Patrick Mateer shall execute a personal guaranty in substantially the form of Exhibit C. 6. Subordination. The Fund subordinates this Agreement to the loans from the Orange County Small Business Loan Program Company to Borrower in the original principal amount of $50,000 made on November 12, 2015, and the US Small Business Administration Note to Borrower in the original principal amount of $150,000 made on September 09, 2016, collectively the "Priority Loans." The Priority Loans shall constitute prior and superior liens and encumbrances on and against the Collateral. This section does not affect the order of priority of other liens on the Collateral. PART THREE - EVENTS OF DEFAULT 7. Events of Default— The happening of any of the following events shall constitute a default under this Agreement (these are the "Events of Default "): 7.1 The Borrower fails to pay when due any amounts payable under the Note; Page 1 of 7