Pharma-Bio Serv, Inc 8-K, filed Apr 29, 2020
Pharma-Bio Serv, Inc. (PBSV)
8-K
2020-04-29
For: 2020-04-23
View Original
Added on
April 06, 2026
About this 8-K
Pharma-Bio Serv, Inc filed this 8-K on April 29, 2020, reporting on events of April 23, 2020.
Items reported
- Item 1.01: Entered into a material agreement
- Item 2.03: New debt or off-balance-sheet obligation
- Item 8.01: Other events
- Item 9.01: Financial statements and exhibits
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM 8-K
CURRENT
REPORT PURSUANT
TO
SECTION 13 or 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date of
report (Date of earliest event reported): April 23, 2020
Pharma-Bio Serv, Inc.
(Exact
Name of Registrant as Specified in Its Charter)
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Delaware
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0-50956
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20-0653570
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(State
or Other Jurisdiction of Incorporation)
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(Commission
File Number)
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(I.R.S.
Employer Identification No.)
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6 Road 696, Dorado, Puerto Rico
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00646
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(Address
of Principal Executive Offices)
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(Zip
Code)
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(787) 278-2709
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(Registrant’s
Telephone Number, Including Area Code)
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(Former
Name or Former Address, if Changed Since Last Report)
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Check
the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant
under any of the following provisions (see General Instruction A.2.
below):
☐
Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
☐
Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
☐
Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
☐
Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Securities
registered pursuant to Section 12(b) of the Act: None
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Indicate
by check mark whether the registrant is an emerging growth company
as defined in Rule 405 of the Securities Act of 1933 (17 CFR
§230.405) or Rule 12b2 of the Securities Exchange Act of 1934
(17 CFR §240.12b2).
Emerging growth
company ☐
If an
emerging growth company, indicate by check mark if the registrant
has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided
pursuant to Section 13(a) of the Exchange Act. ☐
Item
1.01.
Entry
into a Material Definitive Agreement.
The
information under Item 2.03 of this Current Report on Form 8-K is
incorporated herein by reference.
Item
2.03.
Creation
of a Direct Financial Obligation or an Obligation under an Off
Balance Sheet Arrangement of a Registrant.
On
April 23, 2020, Pharma-Bio Serv PR, Inc., Pharma Serv, Inc., and
Pharma-Bio Serv US, Inc. (collectively, the “Borrowers”), each a
wholly-owned subsidiary of Pharma-Bio Serv, Inc. (the
“Company”), entered into loan agreements and related
promissory notes (the “SBA Loan Documents”) to
receive U.S. Small Business Administration Loans (the
“SBA
Loans”) pursuant to the Paycheck Protection Program
(the “PPP”) established under
the Coronavirus Aid, Relief, and Economic Security Act (the
“CARES
Act”), in the aggregate amount of $1,931,700 (the
“Loan
Proceeds”). The Borrowers received the Loan Proceeds
on April 23, 2020. Under the SBA Loan Documents, the SBA Loans have
a fixed interest rate of 1%, repayment begins six months from the
date of disbursement of each SBA Loan, and the SBA Loans mature two
years from the date of first disbursement. There is no prepayment
penalty.
Pursuant to the
terms of the SBA Loan Documents, the Borrowers may apply for
forgiveness of the amount due on the SBA Loans in an amount equal
to the sum of the following costs incurred by the Borrowers during
the eight-week period (or any other period that may be authorized
by the U.S. Small Business Administration) beginning on the date of
first disbursement of the SBA Loans: payroll costs, any payment of
interest on a covered mortgage obligation, payment on a covered
rent obligation, and any covered utility payment. The amount of SBA
Loan forgiveness shall be calculated in accordance with the
requirements of the PPP, including the provisions of Section 1106
of the CARES Act, although no more than 25% of the amount forgiven
can be attributable to non-payroll costs. No assurance is provided
that forgiveness for any portion of the SBA Loans will be
obtained.
The
promissory notes evidencing the SBA Loans contain customary events
of default relating to, among other things, payment defaults,
breach of representations and warranties, or provisions of the
promissory notes. The occurrence of an event of default may result
in the repayment of all amounts outstanding, collection of all
amounts owing from the Borrowers, and/or filing suit and obtaining
judgment against the Borrowers.
The
foregoing description of the SBA Loan Documents is a summary only
and is qualified in its entirely by the reference to the full text
of the loan agreements and promissory notes, which are filed as
Exhibits 10.1, 10.2, 10.3, 10.4, 10.5, and 10.6 to this Current
Report and are incorporated herein by reference.
Item 8.01
Other Events
On
April 29, 2020, the Company's Board voted unanimously to
temporarily suspend the Company's stock repurchase plan. The Board
believes it is prudent to suspend the program due to current
economic uncertainties and will review reinstating the program at a
future date.
Item
9.01.
Financial
Statements and Exhibits.
(d) Exhibits
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Exhibit
No.
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Description
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Loan
Agreement of Pharma-Bio Serv PR, Inc. for Paycheck Protection
Program Loan, dated April 23, 2020.
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Loan
Agreement of Pharma Serv, Inc. for Paycheck Protection Program
Loan, dated April 23, 2020.
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Loan
Agreement of Pharma-Bio Serv US, Inc. for Paycheck Protection
Program Loan, dated April 23, 2020.
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Paycheck
Protection Program Note, dated April 23, 2020, executed by
Pharma-Bio Serv PR, Inc.
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Paycheck
Protection Program Note, dated April 23, 2020, executed by Pharma
Serv, Inc.
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Paycheck
Protection Program Note, dated April 23, 2020, executed by
Pharma-Bio Serv US, Inc.
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
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PHARMA-BIO SERV, INC. |
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Date:
April 29, 2020
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By:
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/s/
Pedro
J. Lasanta
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Pedro J.
Lasanta
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Chief Financial
Officer, Vice President Finance and Administration and
Secretary
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Exhibit 10.1
LOAN AGREEMENT FOR PAYCHECK PROTECTION PROGRAM LOAN
THIS LOAN AGREEMENT ("Agreement") is made between
PHARMA BIO SERV PR
INC
("Borrower"), and Banco Popular de Puerto Rico ("Lender")
identified in the attached Authorization by the U.S. Small Business Administration ("SBA")
to Lender, dated
April 16, 2020
SBA
Loan Number 24986072-10
("Authorization").
WHEREAS,
Borrower seeks funds from Lender pursuant to the SBA's Paycheck
Protection Program ("PPP"), as authorized under the CARES Act, S.
3548 (the "Act");
WHEREAS,
Borrower represents and warrants to Lender that it meets all
qualifications for participation in the PPP set forth in the Act
and further meets any and all other requirements or conditions for
participation set forth by the SBA;
NOW
THEREFORE: The SBA has authorized a guaranty of a loan from Lender
to Borrower for the amount and under the terms stated in the
attached Authorization ("Loan"). In consideration of the promises
in this Agreement and for other good and valuable consideration,
Borrower and Lender agree as follows:
1.
Subject to the terms and conditions of the Authorization and SBA's
Participating Lender Rules as defined in the Guarantee Agreement
between Lender and SBA, Lender agrees to make the Loan on the
condition that Borrower complies with the following "Borrower
Requirements", to which Borrower shall:
a. Provide
Lender with all certifications, documents or other information
Lender is required by the Authorization to obtain from Borrower or
any third party;
b. Execute
a note and any other documents required by Lender; and
c. Do
everything necessary for Lender to comply with the terms and
conditions of the Authorization.
2.
The terms and conditions of this Agreement:
a. Are
binding on Borrower and Lender and their successors and assigns;
and
b. Will
remain in effect after the closing of the Loan.
3.
Failure to abide by any of the Borrower Requirements shall
constitute an event of default under the note and other Loan
documents.
4.
Borrower further represents and certifies to Lender as
follows:
a. Borrower
was in operation on February 15, 2020 and had employees for whom it
paid salaries and payroll taxes or paid independent contractors, as
reported on a Form 1099-MISC.
b. Current
economic uncertainty makes this Loan request necessary to support
the ongoing operations of Borrower.
1
c. The
Loan proceeds will be used to retain employees and maintain payroll
and at least seventy-five percent (75%) of the proceeds must be
used for payroll costs. The remaining balance, up to twenty-five
percent (25%) of the Loan proceeds may be used for authorized
purposes under the PPP, including for mortgage interest payments,
lease payments, and utility payments (i.e., not more than
twenty-five percent (25%) of loan proceeds may be used for
non-payroll costs). Borrower understands and acknowledges that if
the funds are knowingly used for unauthorized purposes, the federal
government may hold Borrower legally liable for fraudulent use of
funds.
d. Documentation
verifying the number of full-time equivalent employees on payroll
as well as the dollar amounts of payroll costs, covered mortgage
interest payments, covered lease payments, and covered utilities
for the eight-week period after the Loan is made will be provided
to Lender.
e. Loan
forgiveness will be provided for the sum of documented payroll
costs, covered mortgage interest payments, covered lease payments,
and covered utilities. Borrower understands that not more than
twenty-five percent (25%) of the forgiven amount may be for
non-payroll costs.
f. During
the period beginning on February 15, 2020 and ending on December
31, 2020, Borrower has not and will not receive another loan under
the PPP.
g. The
information provided in this Agreement and Borrower's Loan
application submitted to Lender, and the information provided in
all supporting documents and forms is true and accurate in all
material respects. Borrower understands that knowingly making a
false statement to obtain a guaranteed loan from the SBA is
punishable under the law, including: (i) under 18 USC §§
1001 and 3571 by imprisonment of not more than five years and/or a
fine of up to $250,000; (ii) under 15 USC § 645 by
imprisonment of not more than two years and/or a fine of not more
than $5,000; and, (iii) if submitted to a federally insured
institution, under 18 USC § 1014 by imprisonment of not more
than thirty years and/or a fine of not more than
$1,000,000.
h. Any
tax documents provided by Borrower to Lender in connection with
this Loan or any application are identical to those submitted to
the Internal Revenue Service. Further, Borrower authorizes Lender
to share tax information with the SBA and its authorized
representatives, including the SBA Office of the Inspector General,
for purposes of compliance with SBA Loan Program Requirements and
all SBA reviews.
i. Borrower
meets the requirements as an eligible borrower under the PPP, and
there are no events or other circumstances of the Borrower that
would render it ineligible for a PPP loan.
2
j.
Borrower is familiar and complies with the SBA affiliation rules
and regulations set forth in Title 13 Part 121 of the Code of
Federal Regulations (CFR) for purposes of obtaining the
Loan.
5.
Borrower attests that it has not retained any third party agent
assisting Borrower with its Loan application, the closing of the
Loan or otherwise serving as an intermediary, agent or broker in
any manner between Borrower and Lender in connection with the Loan
and on Borrower's behalf (including but not limited to accountants,
consultants, loan brokers and/or other individual or entity third
parties) (collectively "Third Party Agents") and further
understands, acknowledges and agrees:
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a. That
(i) Lender does not and will not accept any unsolicited Loan
application referrals or any submissions on Borrower's behalf from
any such Third Party Agent(s) in connection with the Loan, and (ii)
Lender is not responsible, will not pay, and shall not be liable
for any Third Party Agent fees or charges which may be assessed or
claimed to be due and owing in connection with the Loan unless such
Third Party Agent(s) has been approved in writing by, and such
Third Party Agent is expressly authorized to collect fees from,
Lender prior to the acceptance of the Loan
application.
b. That
(i) no funded proceeds from the Loan may or will be used by
Borrower to pay the fees or charges of any Third Party Agent who is
assisting, or may have assisted, Borrower with the Loan
application, the closing of the Loan or otherwise served as an
intermediary or broker to submit the Loan application to Lender on
an applicant's behalf and (ii) any such Third Party Agent(s)
assisting Borrower in such regard are not permitted to collect fees
from, or be paid out, of any Loan proceeds.
That
(i) any fees or charges claimed by any Third Party Agent in
connection with the Loan are the sole and absolute responsibility
of Borrower and (ii) Borrower shall hold Lender harmless in
connection with any claim for such fees or charges asserted by any
Third Party Agent.
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6.
Borrower further agrees to: (i) furnish and execute any documents
required by Lender to verify the truth and accuracy of any
information provided by Borrower in connection with the Loan
including, but not limited to, income, employment verifications and
tax documents; (ii) execute any document that should have been
signed at or before the Loan closing, re-execute any document
signed at or before the Loan closing and execute any document that
was incorrectly or incompletely prepared and signed at the closing,
including, but not limited to, correction notes, and other
correction instruments; and (iii) furnish any documents required by
Lender and/or comply with any conditions, work and/or
certifications set forth in the Loan application or Authorization.
It is further agreed by the Borrower that its failure to comply
with the covenants, representations and agreements herein shall
constitute an event of default under the note and this Agreement
executed in connection with the Loan and shall entitle Lender, its
successors or assigns, to any and all of the remedies available
upon default under such documents.
3
7.
Borrower expressly acknowledges receipt of the Equal Employment
Opportunity Poster (SBA Form 722) and agrees that Borrower shall
display the poster at its place(s) of business where it is clearly
visible to employees, job applicants, and the general
public.
8. Borrower
understands, acknowledges and agrees that Lender is relying solely
on Borrower's representations, warranties, certifications,
confirmations or other statements of, and information from, the
Borrower and/or any of its affiliates, officers, directors, owners,
principals, agents, and/or controlling persons as to the Borrower,
its business or activities, its eligibility for the proposed Loan,
its use of the proceeds or any other benefits of the Loan, the
existence of any hardship or other condition, the eligibility of
the Borrower for forgiveness of all or any portion of the Loan, the
amount of any Loan forgiveness, or any other matters of compliance
with the Act or SBA requirements without limitation or without
Lender's examination of any other information not included in the
Borrower's Loan application which may be in Borrower's
possession.
9. This
Agreement and any amendments hereto or document related hereto, to
the extent signed and delivered by electronic means (including
portable document format (.pdf)), shall be treated in all manner
and respects as an original and shall be considered to have the
same binding legal effects as if it were the original signed
version thereof delivered in person. No party hereto shall raise
the use of electronic means of delivery to deliver a signature or
the fact that any signature or document was transmitted or
communicated through the use of electronic delivery as a defense to
the formation of a contract and each such party forever waives any
such defense.
Borrower: PHARMA BIO SERV PR
INC
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By: /s/ Pedro J Lasanta
Robles
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Date: April 23, 2020
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Name: Pedro J Lasanta Robles
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Its: CFO
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Lender: Banco Popular de Puerto
Rico
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By: /s/ Cinthia Rivera
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Date: April 23, 2020
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Name: Cinthia Rivera
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Its: Commercial Relationship Officer
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4
Exhibit 10.2
LOAN AGREEMENT FOR PAYCHECK PROTECTION PROGRAM LOAN
THIS
LOAN AGREEMENT ("Agreement") is made between
PHARMA SERV INC ("Borrower"),
and Banco Popular de Puerto Rico ("Lender") identified in the
attached Authorization by the U.S. Small Business Administration ("SBA")
to Lender, dated
April 15, 2020
SBA
Loan Number 22073272-10
("Authorization")
WHEREAS,
Borrower seeks funds from Lender pursuant to the SBA's Paycheck
Protection Program ("PPP"), as authorized under the CARES Act, S.
3548 (the "Act");
WHEREAS,
Borrower represents and warrants to Lender that it meets all
qualifications for participation in the PPP set forth in the Act
and further meets any and all other requirements or conditions for
participation set forth by the SBA;
NOW
THEREFORE: The SBA has authorized a guaranty of a loan from Lender
to Borrower for the amount and under the terms stated in the
attached Authorization ("Loan"). In consideration of the promises
in this Agreement and for other good and valuable consideration,
Borrower and Lender agree as follows:
1.
Subject to the terms and conditions of the Authorization and SBA's
Participating Lender Rules as defined in the Guarantee Agreement
between Lender and SBA, Lender agrees to make the Loan on the
condition that Borrower complies with the following "Borrower
Requirements", to which Borrower shall:
a. Provide
Lender with all certifications, documents or other information
Lender is required by the Authorization to obtain from Borrower or
any third party;
b. Execute
a note and any other documents required by Lender; and
c. Do
everything necessary for Lender to comply with the terms and
conditions of the Authorization.
2.
The terms and conditions of this Agreement:
a. Are
binding on Borrower and Lender and their successors and assigns;
and
b. Will
remain in effect after the closing of the Loan.
3.
Failure to abide by any of the Borrower Requirements shall
constitute an event of default under the note and other Loan
documents.
4.
Borrower further represents and certifies to Lender as
follows:
a. Borrower
was in operation on February 15, 2020 and had employees for whom it
paid salaries and payroll taxes or paid independent contractors, as
reported on a Form 1099-MISC.
b. Current
economic uncertainty makes this Loan request necessary to support
the ongoing operations of Borrower.
1
c. The
Loan proceeds will be used to retain employees and maintain payroll
and at least seventy-five percent (75%) of the proceeds must be
used for payroll costs. The remaining balance, up to twenty-five
percent (25%) of the Loan proceeds may be used for authorized
purposes under the PPP, including for mortgage interest payments,
lease payments, and utility payments (i.e., not more than
twenty-five percent (25%) of loan proceeds may be used for
non-payroll costs). Borrower understands and acknowledges that if
the funds are knowingly used for unauthorized purposes, the federal
government may hold Borrower legally liable for fraudulent use of
funds.
d. Documentation
verifying the number of full-time equivalent employees on payroll
as well as the dollar amounts of payroll costs, covered mortgage
interest payments, covered lease payments, and covered utilities
for the eight-week period after the Loan is made will be provided
to Lender.
e. Loan
forgiveness will be provided for the sum of documented payroll
costs, covered mortgage interest payments, covered lease payments,
and covered utilities. Borrower understands that not more than
twenty-five percent (25%) of the forgiven amount may be for
non-payroll costs.
f. During
the period beginning on February 15, 2020 and ending on December
31, 2020, Borrower has not and will not receive another loan under
the PPP.
g. The
information provided in this Agreement and Borrower's Loan
application submitted to Lender, and the information provided in
all supporting documents and forms is true and accurate in all
material respects. Borrower understands that knowingly making a
false statement to obtain a guaranteed loan from the SBA is
punishable under the law, including: (i) under 18 USC §§
1001 and 3571 by imprisonment of not more than five years and/or a
fine of up to $250,000; (ii) under 15 USC § 645 by
imprisonment of not more than two years and/or a fine of not more
than $5,000; and, (iii) if submitted to a federally insured
institution, under 18 USC § 1014 by imprisonment of not more
than thirty years and/or a fine of not more than
$1,000,000.
h. Any
tax documents provided by Borrower to Lender in connection with
this Loan or any application are identical to those submitted to
the Internal Revenue Service. Further, Borrower authorizes Lender
to share tax information with the SBA and its authorized
representatives, including the SBA Office of the Inspector General,
for purposes of compliance with SBA Loan Program Requirements and
all SBA reviews.
i. Borrower
meets the requirements as an eligible borrower under the PPP, and
there are no events or other circumstances of the Borrower that
would render it ineligible for a PPP loan.
2
j.
Borrower is familiar and complies with the SBA affiliation rules
and regulations set forth in Title 13 Part 121 of the Code of
Federal Regulations (CFR) for purposes of obtaining the
Loan.
5.
Borrower attests that it has not retained any third party agent
assisting Borrower with its Loan application, the closing of the
Loan or otherwise serving as an intermediary, agent or broker in
any manner between Borrower and Lender in connection with the Loan
and on Borrower's behalf (including but not limited to accountants,
consultants, loan brokers and/or other individual or entity third
parties) (collectively "Third Party Agents") and further
understands, acknowledges and agrees:
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a. That
(i) Lender does not and will not accept any unsolicited Loan
application referrals or any submissions on Borrower's behalf from
any such Third Party Agent(s) in connection with the Loan, and (ii)
Lender is not responsible, will not pay, and shall not be liable
for any Third Party Agent fees or charges which may be assessed or
claimed to be due and owing in connection with the Loan unless such
Third Party Agent(s) has been approved in writing by, and such
Third Party Agent is expressly authorized to collect fees from,
Lender prior to the acceptance of the Loan
application.
b. That
(i) no funded proceeds from the Loan may or will be used by
Borrower to pay the fees or charges of any Third Party Agent who is
assisting, or may have assisted, Borrower with the Loan
application, the closing of the Loan or otherwise served as an
intermediary or broker to submit the Loan application to Lender on
an applicant's behalf and (ii) any such Third Party Agent(s)
assisting Borrower in such regard are not permitted to collect fees
from, or be paid out, of any Loan proceeds.
That
(i) any fees or charges claimed by any Third Party Agent in
connection with the Loan are the sole and absolute responsibility
of Borrower and (ii) Borrower shall hold Lender harmless in
connection with any claim for such fees or charges asserted by any
Third Party Agent.
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6.
Borrower further agrees to: (i) furnish and execute any documents
required by Lender to verify the truth and accuracy of any
information provided by Borrower in connection with the Loan
including, but not limited to, income, employment verifications and
tax documents; (ii) execute any document that should have been
signed at or before the Loan closing, re-execute any document
signed at or before the Loan closing and execute any document that
was incorrectly or incompletely prepared and signed at the closing,
including, but not limited to, correction notes, and other
correction instruments; and (iii) furnish any documents required by
Lender and/or comply with any conditions, work and/or
certifications set forth in the Loan application or Authorization.
It is further agreed by the Borrower that its failure to comply
with the covenants, representations and agreements herein shall
constitute an event of default under the note and this Agreement
executed in connection with the Loan and shall entitle Lender, its
successors or assigns, to any and all of the remedies available
upon default under such documents.
3
7.
Borrower expressly acknowledges receipt of the Equal Employment
Opportunity Foster (SBA Form 722) and agrees that Borrower shall
display the poster at its place(s) of business where it is clearly
visible to employees, job applicants, and the general
public.
8. Borrower
understands, acknowledges and agrees that Lender is relying solely
on Borrower's representations, warranties, certifications,
confirmations or other statements of, and information from, the
Borrower and/or any of its affiliates, officers, directors, owners,
principals, agents, and/or controlling persons as to the Borrower,
its business or activities, its eligibility for the proposed Loan,
its use of the proceeds or any other benefits of the Loan, the
existence of any hardship or other condition, the eligibility of
the Borrower for forgiveness of all or any portion of the Loan, the
amount of any Loan forgiveness, or any other matters of compliance
with the Act or SBA requirements without limitation or without
Lender's examination of any other information not included in the
Borrower's Loan application which may be in Borrower's
possession.
9. This
Agreement and any amendments hereto or document related hereto, to
the extent signed and delivered by electronic means (including
portable document format (.pdf)), shall be treated in all manner
and respects as an original and shall be considered to have the
same binding legal effects as if it were the original signed
version thereof delivered in person. No party hereto shall raise
the use of electronic means of delivery to deliver a signature or
the fact that any signature or document was transmitted or
communicated through the use of electronic delivery as a defense to
the formation of a contract and each such party forever waives any
such defense.
Borrower: PHARMA SERV
INC
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By: /s/ Pedro J Lasanta
Robles
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Date: April 23, 2020
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Name: Pedro J Lasanta Robles
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Its: CFO
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Lender: Banco Popular de Puerto
Rico
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By: /s/ Cinthia
Rivera
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Date: April 23, 2020
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Name: Cinthia Rivera
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Its: Commercial Relationship Officer
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4
Exhibit 10.3
LOAN AGREEMENT FOR PAYCHECK PROTECTION PROGRAM LOAN
THIS
LOAN AGREEMENT ("Agreement") is made between
PHARMA BIO SERV US INC ("Borrower"),
and Banco Popular de Puerto Rico ("Lender") identified in the
attached Authorization by the U.S. Small Business Administration ("SBA")
to Lender, dated
April 16, 2020
SBA
Loan Number 29994972-01
("Authorization").
WHEREAS,
Borrower seeks funds from Lender pursuant to the SBA's Paycheck
Protection Program ("PPP"), as authorized under the CARES Act, S.
3548 (the "Act");
WHEREAS,
Borrower represents and warrants to Lender that it meets all
qualifications for participation in the PPP set forth in the Act
and further meets any and all other requirements or conditions for
participation set forth by the SBA;
NOW
THEREFORE: The SBA has authorized a guaranty of a loan from Lender
to Borrower for the amount and under the terms stated in the
attached Authorization ("Loan"). In consideration of the promises
in this Agreement and for other good and valuable consideration,
Borrower and Lender agree as follows:
1.
Subject to the terms and conditions of the Authorization and SBA's
Participating Lender Rules as defined in the Guarantee Agreement
between Lender and SBA, Lender agrees to make the Loan on the
condition that Borrower complies with the following "Borrower
Requirements", to which Borrower shall:
a. Provide
Lender with all certifications, documents or other information
Lender is required by the Authorization to obtain from Borrower or
any third party;
b. Execute
a note and any other documents required by Lender; and
c. Do
everything necessary for Lender to comply with the terms and
conditions of the Authorization.
2.
The terms and conditions of this Agreement:
a. Are
binding on Borrower and Lender and their successors and assigns;
and
b. Will
remain in effect after the closing of the Loan.
3.
Failure to abide by any of the Borrower Requirements shall
constitute an event of default under the note and other Loan
documents.
4.
Borrower further represents and certifies to Lender as
follows:
a. Borrower
was in operation on February 15, 2020 and had employees for whom it
paid salaries and payroll taxes or paid independent contractors, as
reported on a Form 1099-MISC.
b. Current
economic uncertainty makes this Loan request necessary to support
the ongoing operations of Borrower.
1
c. The
Loan proceeds will be used to retain employees and maintain payroll
and at least seventy-five percent (75%) of the proceeds must be
used for payroll costs. The remaining balance, up to twenty-five
percent (25%) of the Loan proceeds may be used for authorized
purposes under the PPP, including for mortgage interest payments,
lease payments, and utility payments (i.e., not more than
twenty-five percent (25%) of loan proceeds may be used for
non-payroll costs). Borrower understands and acknowledges that if
the funds are knowingly used for unauthorized purposes, the federal
government may hold Borrower legally liable for fraudulent use of
funds.
d. Documentation
verifying the number of full-time equivalent employees on payroll
as well as the dollar amounts of payroll costs, covered mortgage
interest payments, covered lease payments, and covered utilities
for the eight-week period after the Loan is made will be provided
to Lender.
e. Loan
forgiveness will be provided for the sum of documented payroll
costs, covered mortgage interest payments, covered lease payments,
and covered utilities. Borrower understands that not more than
twenty-five percent (25%) of the forgiven amount may be for
non-payroll costs.
f. During
the period beginning on February 15, 2020 and ending on December
31, 2020, Borrower has not and will not receive another loan under
the PPP.
g. The
information provided in this Agreement and Borrower's Loan
application submitted to Lender, and the information provided in
all supporting documents and forms is true and accurate in all
material respects. Borrower understands that knowingly making a
false statement to obtain a guaranteed loan from the SBA is
punishable under the law, including: (i) under 18 USC §§
1001 and 3571 by imprisonment of not more than five years and/or a
fine of up to $250,000; (ii) under 15 USC § 645 by
imprisonment of not more than two years and/or a fine of not more
than $5,000; and, (iii) if submitted to a federally insured
institution, under 18 USC § 1014 by imprisonment of not more
than thirty years and/or a fine of not more than
$1,000,000.
h. Any
tax documents provided by Borrower to Lender in connection with
this Loan or any application are identical to those submitted to
the Internal Revenue Service. Further, Borrower authorizes Lender
to share tax information with the SBA and its authorized
representatives, including the SBA Office of the Inspector General,
for purposes of compliance with SBA Loan Program Requirements and
all SBA reviews.
i. Borrower
meets the requirements as an eligible borrower under the PPP, and
there are no events or other circumstances of the Borrower that
would render it ineligible for a PPP loan.
2
j.
Borrower is familiar and complies with the SBA affiliation rules
and regulations set forth in Title 13 Part 121 of the Code of
Federal Regulations (CFR) for purposes of obtaining the
Loan.
5.
Borrower attests that it has not retained any third party agent
assisting Borrower with its Loan application, the closing of the
Loan or otherwise serving as an intermediary, agent or broker in
any manner between Borrower and Lender in connection with the Loan
and on Borrower's behalf (including but not limited to accountants,
consultants, loan brokers and/or other individual or entity third
parties) (collectively "Third Party Agents") and further
understands, acknowledges and agrees:
a.
That (i) Lender does not and will not accept any unsolicited Loan
application referrals or any submissions on Borrower's behalf from
any such Third Party Agent(s) in connection with the Loan, and (ii)
Lender is not responsible, will not pay, and shall not be liable
for any Third Party Agent fees or charges which may be assessed or
claimed to be due and owing in connection with the Loan unless such
Third Party Agent(s) has been approved in writing by, and such
Third Party Agent is expressly authorized to collect fees from,
Lender prior to the acceptance of the Loan
application.
|
|
b. That
(i) no funded proceeds from the Loan may or will be used by
Borrower to pay the fees or charges of any Third Party Agent who is
assisting, or may have assisted, Borrower with the Loan
application, the closing of the Loan or otherwise served as an
intermediary or broker to submit the Loan application to Lender on
an applicant's behalf and (ii) any such Third Party Agent(s)
assisting Borrower in such regard are not permitted to collect fees
from, or be paid out, of any Loan proceeds.
c. That
(i) any fees or charges claimed by any Third Party Agent in
connection with the Loan are the sole and absolute responsibility
of Borrower and (ii) Borrower shall hold Lender harmless in
connection with any claim for such fees or charges asserted by any
Third Party Agent.
|
6.
Borrower further agrees to: (i) furnish and execute any documents
required by Lender to verify the truth and accuracy of any
information provided by Borrower in connection with the Loan
including, but not limited to, income, employment verifications and
tax documents; (ii) execute any document that should have been
signed at or before the Loan closing, re-execute any document
signed at or before the Loan closing and execute any document that
was incorrectly or incompletely prepared and signed at the closing,
including, but not limited to, correction notes, and other
correction instruments; and (iii) furnish any documents required by
Lender and/or comply with any conditions, work and/or
certifications set forth in the Loan application or Authorization.
It is further agreed by the Borrower that its failure to comply
with the covenants, representations and agreements herein shall
constitute an event of default under the note and this Agreement
executed in connection with the Loan and shall entitle Lender, its
successors or assigns, to any and all of the remedies available
upon default under such documents.
3
7.
Borrower expressly acknowledges receipt of the Equal Employment
Opportunity Poster (SBA Form 722) and agrees that Borrower shall
display the poster at its place(s) of business where it is clearly
visible to employees, job applicants, and the general
public.
8. Borrower
understands, acknowledges and agrees that Lender is relying solely
on Borrower's representations, warranties, certifications,
confirmations or other statements of, and information from, the
Borrower and/or any of its affiliates, officers, directors, owners,
principals, agents, and/or controlling persons as to the Borrower,
its business or activities, its eligibility for the proposed Loan,
its use of the proceeds or any other benefits of the Loan, the
existence of any hardship or other condition, the eligibility of
the Borrower for forgiveness of all or any portion of the Loan, the
amount of any Loan forgiveness, or any other matters of compliance
with the Act or SBA requirements without limitation or without
Lender's examination of any other information not included in the
Borrower's Loan application which may be in Borrower's
possession.
9. This
Agreement and any amendments hereto or document related hereto, to
the extent signed and delivered by electronic means (including
portable document format (.pdf)), shall be treated in all manner
and respects as an original and shall be considered to have the
same binding legal effects as if it were the original signed
version thereof delivered in person. No party hereto shall raise
the use of electronic means of delivery to deliver a signature or
the fact that any signature or document was transmitted or
communicated through the use of electronic delivery as a defense to
the formation of a contract and each such party forever waives any
such defense.
Borrower: PHARMA BIO SERV US
INC
|
By: /s/ Pedro J Lasanta
Robles
|
Date: April 23, 2020
|
|
Name: Pedro J Lasanta Robles
|
|
|
Its: CFO
|
|
|
|
|
|
Lender: Banco Popular de Puerto
Rico
|
|
|
|
|
|
By: /s/ Cinthia
Rivera
|
Date: April 23, 2020
|
|
Name: Cinthia Rivera
|
|
|
Its: Commercial Relationship Officer
|
|
4
Exhibit
10.4
PAYCHECK PROTECTION PROGRAM LOAN
NOTE
|
SBA
Loan #
|
PPP
- 24986072-10
|
|
SBA
Loan Name
|
PHARMA
BIO SERV PR INC
|
|
Date
|
April
23, 2020
|
|
Loan
Amount
|
$757,100.00
|
|
Interest
Rate
|
1.00%
|
|
Borrower
|
PHARMA
BIO SERV PR INC
|
|
Operating
Company
|
|
|
Lender
|
Banco
Popular de Puerto Rico
|
1
PROMISE
TO PAY:
In
return for the Loan, Borrower promises to pay to the order of
Lender the amount of seven
hundred fifty-seven thousand one hundred with 00/100
Dollars
,interest
on the unpaid principal balance, and all other amounts required by
this Note.
2.
DEFINITIONS:
"Loan"
means the loan evidenced by this Note.
"Loan
Documents" means the documents related to this loan signed by
Borrower.
"SBA"
means the Small Business Administration, an Agency of the United
States of America.
1
3. PAYMENT TERMS:
Borrower
must make all payments at the place Lender designates. The payment
terms for this Note are:
Interest
Rate: The outstanding principal amount of this Note, shall bear
interest from the date hereof until paid in full at a fixed annual
rate equal to 100 basis points or 1%. The fixed interest rate will
not be changed during the life of the loan.
Maturity:
The maturity of the Loan is two years from the date of first
disbursement of this loan (the "Maturity Date").
Deferral:
Borrower does not have to make any payments for six months
following the date of disbursement of the Loan. However, interest
will continue to accrue on the Loan during the six-month deferment
period.
Repayment:
After the six-month deferment period, the Borrower shall repay the
fully amortized outstanding Loan amount through 18 successive
monthly payments of principal and interest in equal installments.
Lender will apply any payment first to pay interest accrued as of
the day the Lender receives the payment, then to bring principal
current, and will apply any remaining balance to reduce
principal.
Forgiveness:
An amount up to the full principal amount of the Loan and any
accrued interest can be forgiven in accordance with section 1106 of
the Coronavirus Aid, Relief, and Economic Security Act ("CARES
Act") and the corresponding regulations issued by SBA.
The
amount of loan forgiveness shall be calculated (and may be reduced)
in accordance with the requirements of the Paycheck Protection
Program and the CARES Act.
The
actual amount of loan forgiveness will depend, in part. on the
total amount of payroll costs, payments of interest on mortgage
obligations incurred before February 15, 2020, rent payments on
leases dated before February 15, 2020, and utility payments under
service agreements dated before February 15, 2020, over the
eight-week period following the date of the Loan; provided,
however, that not more than 25 percent of the loan forgiveness
amount may be attributable to nonpayroll costs.
Non-Recourse.
Lender and SBA shall have no recourse against any individual
shareholder, member or partner of Borrower for non-payment of the
Loan, except to the extent that such shareholder, member or partner
uses the Loan proceeds for an unauthorized purpose.
2
4. DEFAULT
Borrower
is in default under this Note if Borrower does not make a payment
when due under this Note, or if Borrower or Operating
Company:
A.
Fails
to do anything required by this Note and other Loan
Documents;
B.
Defaults
on any other loan with Lender;
C.
Does
not disclose, or anyone acting on their behalf does not disclose,
any material fact to Lender or SBA;
D.
Makes,
or anyone acting on their behalf makes, a materially false or
misleading representation to Lender or SBA;
E.
Defaults
on any loan or agreement with another creditor, if Lender believes
the default may materially affect Borrower's ability to pay this
Note.
F. Fails
to pay any taxes when due;
G. Becomes
the subject of a proceeding under any bankruptcy or insolvency
law;
H. Has
a receiver or liquidator appointed for any part of their business
or property;
I. Makes
an assignment for the benefit of creditors;
J. Has
any adverse change in financial condition or business operation
that Lender believes may materially affect Borrower's ability to
pay this Note.
K. Reorganizes,
merges, consolidates, or otherwise changes ownership or business
structure without Lender's prior written consent; or
L.
Becomes
the subject of a civil or criminal action that Lender believes may
materially affect Borrowers' ability
5.
LENDER'
S RIGHTS IF THERE IS A DEFAULT:
Without
notice or demand and without giving up any of its rights, Lender
may:
A. Require
immediate payment of all amounts owing under this
Note;
B. Collect
all amounts owing from any Borrower; or
C. File
suit and obtain judgment.
6.
LENDER'
S GENERAL POWERS:
Without
notice and without Borrower's consent, Lender may:
A. Release
anyone obligated to pay this Note; or
B. Incur
expenses to collect amounts due under this Note, enforce the terms
of this Note or any other Loan.
C.
Take
any action necessary to collect amounts owing on this
Note
3
7.
WHEN
FEDERAL LAW APPLIES:
When
SBA is the holder, this Note will be interpreted and enforced under
federal law, including SBA regulations. Lender or SBA may use state
or local procedures for filing papers, recording documents, giving
notice, foreclosing liens, and other purposes. By using such
procedures, SBA does not waive any federal immunity from state or
local control, penalty, tax, or liability. As to this Note,
Borrower may not claim or assert against SBA any local or state law
to deny any obligation, defeat any claim of SBA, or preempt federal
law.
8.
SUCCESSORS
AND ASSIGNS
Under
this Note, Borrower and Operating Company include the successors of
each, and Lender includes its successors and assigns.
9.
GENERAL
PROVISIONS
A. All
individuals and entities signing this Note are jointly and
severally liable.
B. Borrower
waives all suretyship defenses.
C. Borrower
must sign all documents necessary at any time to comply with the
Loan Documents.
D. Lender
may exercise any of its rights separately or together, as many
times and in any order it chooses. Lender may delay or forgo
enforcing any of its rights without giving up any of
them.
E. Borrower
may not use an oral statement of Lender or SBA to contradict or
alter the written terms of this Note.
F. If
any part of this Note is unenforceable, all other parts remain in
effect.
G. To
the extent allowed by law, Borrower waives all demands and notices
in connection with this Note, including presentment, demand,
protest, and notice of dishonor.
10.
PAYCHECK
PROTECTION PROGRAM PROVISIONS:
A. Payment,
as set forth in Section 3 above, shall be deferred as prescribed by
the CARES Act, as may be amended from time to time, and any
implementing regulations promulgated thereunder. Borrower may elect
to defer payment for up to six (6) months from the date the Loan is
funded.
B. Interest
on the Loan will accrue as described in Section 3 for the duration
of any deferral.
C. Borrower
may apply for forgiveness of certain amounts under this Note as set
forth in the CARES Act, as may be amended from time to time, and
any implementing regulations promulgated thereunder.
4
11.
STATE-SPECIFIC
PROVISIONS:
N/A.
12. BORROWER
'S NAME(S) AND SIGNATURE(S):
By
signing below, each individual or entity becomes obligated under
this Note as Borrower.
PHARMA
BIO SERV PR INC
By:/s/
Pedro J. Lasanta Robles
Pedro
J. Lasanta Robles
CFO
5
Exhibit
10.5
PAYCHECK PROTECTION PROGRAM LOAN
NOTE
|
SBA
Loan #
|
PPP
- 22073272-10
|
|
SBA
Loan Name
|
PHARMA
SERV INC
|
|
Date
|
April
23, 2020
|
|
Loan
Amount
|
$1,080,400.00
|
|
Interest
Rate
|
1.00%
|
|
Borrower
|
PHARMA
SERV INC
|
|
Operating
Company
|
|
|
Lender
|
Banco
Popular de Puerto Rico
|
.
PROMISE
TO PAY:
In
return for the Loan, Borrower promises to pay to the order of
Lender the amount of one
million eighty thousand four hundred with
00/100 Dollars,
interest
on the unpaid principal balance, and all other amounts required by
this Note.
2.
DEFINITIONS:
"Loan"
means the loan evidenced by this Note.
"Loan
Documents" means the documents related to this loan signed by
Borrower.
"SBA"
means the Small Business Administration, an Agency of the United
States of America.
1
3. PAYMENT TERMS:
Borrower
must make all payments at the place Lender designates. The payment
terms for this Note are:
Interest
Rate: The outstanding principal amount of this Note, shall bear
interest from the date hereof until paid in full at a fixed annual
rate equal to 100 basis points or 1%. The fixed interest rate will
not be changed during the life of the loan.
Maturity:
The maturity of the Loan is two years from the date of first
disbursement of this loan (the "Maturity Date").
Deferral:
Borrower does not have to make any payments for six months
following the date of disbursement of the Loan. However, interest
will continue to accrue on the Loan during the six-month deferment
period.
Repayment:
After the six-month deferment period, the Borrower shall repay the
fully amortized outstanding Loan amount through 18 successive
monthly payments of principal and interest in equal installments.
Lender will apply any payment first to pay interest accrued as of
the day the Lender receives the payment, then to bring principal
current, and will apply any remaining balance to reduce
principal.
Forgiveness:
An amount up to the full principal amount of the Loan and any
accrued interest can be forgiven in accordance with section 1106 of
the Coronavirus Aid, Relief, and Economic Security Act ("CARES
Act") and the corresponding regulations issued by SBA.
The
amount of loan forgiveness shall be calculated (and may be reduced)
in accordance with the requirements of the Paycheck Protection
Program and the CARES Act.
The
actual amount of loan forgiveness will depend, in part, on the
total amount of payroll costs, payments of interest on mortgage
obligations incurred before February 15, 2020, rent payments on
leases dated before February 15, 2020, and utility payments under
service agreements dated before February 15, 2020, over the
eight-week period following the date of the Loan; provided,
however, that not more than 25 percent of the loan forgiveness
amount may be attributable to nonpayroll costs.
Non-Recourse.
Lender and SBA shall have no recourse against any individual
shareholder, member or partner of Borrower for non-payment of the
Loan, except to the extent that such shareholder, member or partner
uses the Loan proceeds for an unauthorized purpose.
2
4. DEFAULT
Borrower
is in default under this Note if Borrower does not make a payment
when due under this Note, or if Borrower or Operating
Company:
A. Fails
to do anything required by this Note and other Loan
Documents;
B. Defaults
on any other loan with Lender;
C. Does
not disclose, or anyone acting on their behalf does not disclose,
any material fact to Lender or SBA;
D. Makes,
or anyone acting on their behalf makes, a materially false or
misleading representation to Lender or SBA;
E. Defaults
on any loan or agreement with another creditor, if Lender believes
the default may materially affect Borrower's ability to pay this
Note.
F. Fails
to pay any taxes when due;
G. Becomes
the subject of a proceeding under any bankruptcy or insolvency
law;
H. Has
a receiver or liquidator appointed for any part of their business
or property;
I. Makes
an assignment for the benefit of creditors;
J. Has
any adverse change in financial condition or business operation
that Lender believes may materially affect Borrower's ability to
pay this Note.
K.
Reorganizes,
merges, consolidates, or otherwise changes ownership or business
structure without Lender's prior written consent; or
L. Becomes the subject of a civil or
criminal action that Lender believes may materially affect
Borrowers' ability
5.
LENDER'
S RIGHTS IF THERE IS A DEFAULT:
Without
notice or demand and without giving up any of its rights, Lender
may:
A. Require
immediate payment of all amounts owing under this
Note;
B. Collect
all amounts owing from any Borrower; or
C. File
suit and obtain judgment.
6.
LENDER'
S GENERAL POWERS:
Without
notice and without Borrower's consent, Lender may:
A. Release
anyone obligated to pay this Note; or
B. Incur
expenses to collect amounts due under this Note, enforce the terms
of this Note or any other Loan.
C. Take any action necessary to collect
amounts owing on this Note
3
7.
WHEN
FEDERAL LAW APPLIES:
When
SBA is the holder, this Note will be interpreted and enforced under
federal law, including SBA regulations. Lender or SBA may use state
or local procedures for filing papers, recording documents, giving
notice, foreclosing liens, and other purposes. By using such
procedures, SBA does not waive any federal immunity from state or
local control, penalty, tax, or liability. As to this Note,
Borrower may not claim or assert against SBA any local or state law
to deny any obligation, defeat any claim of SBA, or preempt federal
law.
8.
SUCCESSORS
AND ASSIGNS
Under
this Note, Borrower and Operating Company include the successors of
each, and Lender includes its successors and assigns.
9.
GENERAL
PROVISIONS
A. All
individuals and entities signing this Note are jointly and
severally liable.
B. Borrower
waives all suretyship defenses.
C. Borrower
must sign all documents necessary at any time to comply with the
Loan Documents.
D. Lender
may exercise any of its rights separately or together, as many
times and in any order it chooses. Lender may delay or forgo
enforcing any of its rights without giving up any of
them.
E. Borrower
may not use an oral statement of Lender or SBA to contradict or
alter the written terms of this Note.
F. If
any part of this Note is unenforceable, all other parts remain in
effect.
G. To
the extent allowed by law, Borrower waives all demands and notices
in connection with this Note, including presentment, demand,
protest, and notice of dishonor.
10.
PAYCHECK
PROTECTION PROGRAM PROVISIONS:
A. Payment,
as set forth in Section 3 above, shall be deferred as prescribed by
the CARES Act, as may be amended from time to time, and any
implementing regulations promulgated thereunder. Borrower may elect
to defer payment for up to six (6) months from the date the Loan is
funded.
B. Interest
on the Loan will accrue as described in Section 3 for the duration
of any deferral.
C. Borrower
may apply for forgiveness of certain amounts under this Note as set
forth in the CARES Act, as may be amended from time to time, and
any implementing regulations promulgated thereunder.
4
11.
STATE-SPECIFIC
PROVISIONS:
N/A
12. BORROWER
'S NAME(S) AND SIGNATURE(S):
By
signing below, each individual or entity becomes obligated under
this Note as Borrower.
PHARMA
SERV INC
By:/s/
Pedro J. Lasanta Robles
Pedro
J. Lasanta Robles
CFO
5
Exhibit
10.6
PAYCHECK PROTECTION PROGRAM LOAN
NOTE
|
SBA
Loan #
|
PPP
- 29994972-01
|
|
|
SBA
Loan Name
|
PHARMA
BIO SERV US INC
|
|
|
Date
|
April
23, 2020
|
|
|
Loan
Amount
|
$94,200.00
|
|
|
Interest Rate
|
1.00%
|
|
|
Borrower
|
PHARMA
BIO SERV US INC
|
|
|
Operating Company
|
|
|
|
Lender
|
Banco
Popular de Puerto Rico
|
|
|
|
|
|
. PROMISE
TO PAY:
In
return for the Loan, Borrower promises to pay to the order of
Lender the amount of ninety-four
thousand two hundred with 00/100
Dollars, interest
on the unpaid principal balance, and all other amounts required by
this Note.
2.
DEFINITIONS:
"Loan"
means the loan evidenced by this Note.
"Loan
Documents" means the documents related to this loan signed by
Borrower.
"SBA"
means the Small Business Administration, an Agency of the United
States of America.
1
3. PAYMENT TERMS:
Borrower
must make all payments at the place Lender designates. The payment
terms for this Note are:
Interest
Rate: The outstanding principal amount of this Note, shall bear
interest from the date hereof until paid in full at a fixed annual
rate equal to 100 basis points or 1%. The fixed interest rate will
not be changed during the life of the loan.
Maturity:
The maturity of the Loan is two years from the date of first
disbursement of this loan (the "Maturity Date").
Deferral:
Borrower does not have to make any payments for six months
following the date of disbursement of the Loan. However, interest
will continue to accrue on the Loan during the six-month deferment
period.
Repayment:
After the six-month deferment period, the Borrower shall repay the
fully amortized outstanding Loan amount through 18 successive
monthly payments of principal and interest in equal installments.
Lender will apply any payment first to pay interest accrued as of
the day the Lender receives the payment, then to bring principal
current, and will apply any remaining balance to reduce
principal.
Forgiveness:
An amount up to the full principal amount of the Loan and any
accrued interest can be forgiven in accordance with section 1106 of
the Coronavirus Aid, Relief, and Economic Security Act ("CARES
Act") and the corresponding regulations issued by SBA.
The
amount of loan forgiveness shall be calculated (and may be reduced)
in accordance with the requirements of the Paycheck Protection
Program and the CARES Act.
The
actual amount of loan forgiveness will depend, in part, on the
total amount of payroll costs, payments of interest on mortgage
obligations incurred before February 15, 2020, rent payments on
leases dated before February 15, 2020, and utility payments under
service agreements dated before February 15, 2020, over the
eight-week period following the date of the Loan; provided,
however, that not more than 25 percent of the loan forgiveness
amount may be attributable to nonpayroll costs.
Non-Recourse.
Lender and SBA shall have no recourse against any individual
shareholder, member or partner of Borrower for non-payment of the
Loan, except to the extent that such shareholder, member or partner
uses the Loan proceeds for an unauthorized purpose.
2
4. DEFAULT
Borrower
is in default under this Note if Borrower does not make a payment
when due under this Note, or if Borrower or Operating
Company:
A. Fails
to do anything required by this Note and other Loan
Documents;
B. Defaults
on any other loan with Lender;
C. Does
not disclose, or anyone acting on their behalf does not disclose,
any material fact to Lender or SBA;
D. Makes,
or anyone acting on their behalf makes, a materially false or
misleading representation to Lender or SBA;
E. Defaults
on any loan or agreement with another creditor, if Lender believes
the default may materially affect Borrower's ability to pay this
Note.
F. Fails
to pay any taxes when due;
G. Becomes
the subject of a proceeding under any bankruptcy or insolvency
law;
H. Has
a receiver or liquidator appointed for any part of their business
or property;
I. Makes
an assignment for the benefit of creditors;
J. Has
any adverse change in financial condition or business operation
that Lender believes may materially affect Borrower's ability to
pay this Note.
K. Reorganizes,
merges, consolidates, or otherwise changes ownership or business
structure without Lender's prior written consent; or
L. Becomes the subject of a civil or
criminal action that Lender believes may materially affect
Borrowers' ability
5.
LENDER'
S RIGHTS IF THERE IS A DEFAULT:
Without
notice or demand and without giving up any of its rights, Lender
may:
A. Require
immediate payment of all amounts owing under this
Note;
B. Collect
all amounts owing from any Borrower; or
C. File
suit and obtain judgment.
6.
LENDER'
S GENERAL POWERS:
Without
notice and without Borrower's consent, Lender may:
A. Release
anyone obligated to pay this Note; or
B. Incur
expenses to collect amounts due under this Note, enforce the terms
of this Note or any other Loan.
C. Take
any action necessary to collect amounts owing on this
Note
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7.
WHEN
FEDERAL LAW APPLIES:
When
SBA is the holder, this Note will be interpreted and enforced under
federal law, including SBA regulations. Lender or SBA may use state
or local procedures for filing papers, recording documents, giving
notice, foreclosing liens, and other purposes. By using such
procedures, SBA does not waive any federal immunity from state or
local control, penalty, tax, or liability. As to this Note,
Borrower may not claim or assert against SBA any local or state law
to deny any obligation, defeat any claim of SBA, or preempt federal
law.
8.
SUCCESSORS
AND ASSIGNS
Under
this Note, Borrower and Operating Company include the successors of
each, and Lender includes its successors and assigns.
9.
GENERAL
PROVISIONS
A. All
individuals and entities signing this Note are jointly and
severally liable.
B. Borrower
waives all suretyship defenses.
C. Borrower
must sign all documents necessary at any time to comply with the
Loan Documents.
D. Lender
may exercise any of its rights separately or together, as many
times and in any order it chooses. Lender may delay or forgo
enforcing any of its rights without giving up any of
them.
E. Borrower
may not use an oral statement of Lender or SBA to contradict or
alter the written terms of this Note.
F. If
any part of this Note is unenforceable, all other parts remain in
effect.
G. To
the extent allowed by law, Borrower waives all demands and notices
in connection with this Note, including presentment, demand,
protest, and notice of dishonor.
10.
PAYCHECK
PROTECTION PROGRAM PROVISIONS:
A. Payment,
as set forth in Section 3 above, shall be deferred as prescribed by
the CARES Act, as may be amended from time to time, and any
implementing regulations promulgated thereunder. Borrower may elect
to defer payment for up to six (6) months from the date the Loan is
funded.
B. Interest
on the Loan will accrue as described in Section 3 for the duration
of any deferral.
C. Borrower
may apply for forgiveness of certain amounts under this Note as set
forth in the CARES Act, as may be amended from time to time, and
any implementing regulations promulgated thereunder.
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11.
STATE-SPECIFIC
PROVISIONS:
N/A
12.
BORROWER
'S NAME(S) AND SIGNATURE(S):
By
signing below, each individual or entity becomes obligated under
this Note as Borrower.
PHARMA SERV INC
By: /s/ Pedro J. Lasanta
Robles
Pedro
J. Lasanta Robles
CFO
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