Exhibit
10.3


 


 


 


August
31, 2017


 


Mr.
Jeffrey Barocas


Ocean
Bio-Chem, Inc.


4041
S.W. 47 Ave.


Ft.
Lauderdale, FL 33314


 


Dear
Jeff:


 


The
purpose of this letter is to document an agreement between Ocean Bio-Chem, Inc. and Regions Bank regarding
specific terms and conditions relating to the renewal (and increase of) a $4,000,000 line of credit (now $6,000,000). The
terms presented below will supersede any conflicting language in the Promissory Note (Note), Business Loan Agreement (BLA),
and Commercial Security Agreement (Security Agreement), each to be dated August 31, 2017. Capitalized terms not defined in
this letter will have the meanings ascribed to them in the Note, BLA, or the Security Agreement, as applicable.


 


ALL
DOCUMENTS


 


	 	●	Any usage of “OCEAN BIO CHEM INC” in the attached documents specifically references your
    company which has the legal name of “Ocean Bio-Chem, Inc.”.



 


PROMISSORY NOTE


 


	 	●	Change in Ownership-Regions agrees that a change in ownership of 25% or more will not
    constitute an event of default. Instead, a default will be triggered in the event that the majority shareholder’s ownership
    drops below 50% of all outstanding shares. (This modification also applies to the BLA and Security Agreement.)



 


BUSINESS LOAN AGREEMENT (BLA)


 


	 	●	Hazardous Substances. Regions agrees that clauses (1), (2) and (3) of the provision
    Hazardous Substances shall read as follows: Except as disclosed to and acknowledged by Lender in writing, Borrower
    represents and warrants that: (1) During the period of Borrower’s ownership
    of the Collateral, there has been no use, generation, manufacture, storage, treatment, disposal, release or threatened
    release     of any Hazardous Substance by any person on, under, about or from any of the Collateral except in
    material compliance     with Environmental Laws. (2) Borrower has no knowledge of, or reason to believe that there has
    been (a) any breach or     violation of any Environmental Laws; (b) any use, generation, manufacture, storage, treatment,
    disposal, release or threatened     release of any Hazardous Substance on, under, about or from the Collateral by any prior
    owners or occupants of any ofthe     Collateral except in material compliance with Environmental Laws; or (c) any
    actual or threatened litigation or claims     of any kind by any person relating to such matters. (3) Neither Borrower nor
    any tenant, contactor, agent or other authorizeduser     of any of the Collateral shall use, generate, manufacture,
    store, treat, dispose of or release any Hazardous Substance on,     under, about or from any of the Collateral except in
    material compliance with Environmental Laws; and any such activity     shall be conducted in material compliance
    with all applicable federal, state, and local laws, regulations, and ordinances,     including without limitation all
    Environmental Laws.



 






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	 	●	Environmental
    Compliance and Reports. Regions agrees that the provision Environmental Compliance and Reports shall read as follows:
    Borrower shall comply in all material respects with any and all Environmental Laws; not cause or permit to exist, as
    a result of an intentional or unintentional action or omission on Borrower’s part or on the part of any third party,
    on property owned and/or occupied by Borrower, any environmental activity where damage may result to the environment, unless
    such environmental activity is pursuant to an in material compliance with the conditions of a permit issued by the
    appropriate federal, state or local governmental authorities or otherwise in material compliance with Environmental Laws;
    shall furnish to Lender promptly and in any event within thirty (30) days after receipt thereof a copy of any notice,
    summons, lien, citation, directive, letter or other communication from any governmental agency or instrumentality concerning
    any intentional or unintentional action or omission on Borrower’s part in connection with any environmental activity
    whether or not there is damage to the environment and/or other natural resources.



  


		●	Indebtedness
                                                                                                                                                                                                                                                                                                          and Liens. Regions agrees that the provision Indebtedness and Liens shall
                                                                                                                                                                                                                                                                                                          read as follows: (1) Except for trade debt incurred in the normal course of business,
                                                                                                                                                                                                                                                                                                          indebtedness otherwise disclosed to Lender and indebtedness to Lender contemplated
                                                                                                                                                                                                                                                                                                          by this Agreement, create, incur or assume indebtedness for borrowed money, including
                                                                                                                                                                                                                                                                                                          capital leases, (2) sell, transfer or lease any of Borrower’s assets (except for inventory
                                                                                                                                                                                                                                                                                                          sold or accounts collected in the ordinary course of business, or as otherwise provided for
                                                                                                                                                                                                                                                                                                          in this Agreement), (3) mortgage, assign, pledge, grant a security interest in, or
                                                                                                                                                                                                                                                                                                          encumber any of Borrower’s assets (except as allowed as Permitted
                                                                                                                                                                                                                                                                                                          Liens), or (3) sell with recourse any of Borrower’s accounts, except to Lender.



 


Further,
Regions Bank acknowledges that, as of 8/31/17, Ocean Bio-Chem, Inc.’s subsidiary, Kinpak, Inc., has obtained a $4.5MM
financing commitment from Regions Capital Advantage, Inc. to provide expansion financing for a location that holds collateral
for the subject line of credit facility.


 


		●	Subsidiaries and
                                                                                    Affiliates of Borrower. Regions agrees that the provision of Subsidiaries and Affiliates of Borrower shall be
                                                                                    renamed “Subsidiaries of Borrower” and the phrase “and affiliates” and the phrase “or
                                                                                    affiliates” deleted therefrom.



 













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		●	Eligible
                                         Accounts. Regions agrees that the second clause under this section (related to exclusions
                                         to eligible accounts) should read as follows “Accounts with respect to which the
                                         Account Debtor is a subsidiary of, or affiliated with Borrower or its officers or its
                                         directors”.



 


		●	Eligible
                                                                                                                                                                                                                                                                                                      Inventory, Regions agrees that the second clause under this section (related to exclusions to eligible inventory) should
                                                                                                                                                                                                                                                                                                      read as follows “Inventory which Lender reasonably deems to be obsolete, unsaleable, damaged, defective, or
                                                                                                                                                                                                                                                                                                      unfit for further processing”.



 


SECURITY
AGREEMENT


 


		●	Enforceability
                                         of Collateral. Regions agrees that second sentence of the provision Enforceability
                                         of Collateral shall read as follows: There shall be no setoffs or counterclaims
                                         against any of the Collateral, and no agreement shall have been made under which any
                                         deductions or discounts many be claimed concerning the Collateral except those deductions
                                         or discounts in the ordinary course of business and those disclosed to Lender in
                                         writing.



 


		●	Transactions
                                         Involving Collateral. Regions agrees that the first sentence of the provision Transactions
                                         Involving Collateral shall read as follows: Except for inventory sold or accounts
                                         collected in the ordinary course of Granter’s business, or as otherwise provided for
                                         in this Agreement, Granter shall not sell, offer to sell, or otherwise transfer of dispose
                                         of the Collateral. Grantor shall not pledge, mortgage, encumber or otherwise permit
                                         the Collateral to be subject to any lien, security interest, encumbrance, or charge,
                                         other than the security interest provided for in this Agreement
and Permitted Liens, without the prior written consent of Lender.



 


		●	Title.
                                         Regions agrees that the first sentence of the provision Title shall read as
                                         follows: Granter represents and warrants to Lender that Granter holds good and marketable
                                         title to the Collateral, free and clear of all liens and encumbrances except for the
                                         lien of this Agreement and Permitted Liens.



 


		●	Hazardous
                                         Substances. Regions agrees that the first sentence of the provision Hazardous
Substances shall read as follows: Grantor represents and warrants that the
collateral never has been, and never will be so long as this Agreement remains a lien on the Collateral, used in violation of
any Environmental Laws or for the generation, manufacture, storage, transportation, treatment, disposal, release or
threatened release of any Hazardous Substance except in material compliance with Environmental Laws.



  


	Sincerely,	 
	 	 
	/s/ Draper L. Stanford	 
	Draper L. Stanford	 
	Vice President	 
	Regions Bank	 




 


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