**EXHIBIT 10.27**

LOANAGREEMENT

THISIS A LOAN AGREEMENT (the “Agreement”), dated as of the 14th day of January,2004, between Transnational Industries, Inc., a Delaware corporation, andSpitz, Inc., a Delaware corporation (individually, collectively, jointly and severallyreferred to as the “Borrower”), with an address of P.O. Box 198, Route 1,Chadds Ford, Pennsylvania 19317, and FIRST KEYSTONE BANK (“Lender”), a federallychartered stock savings bank organized and existing under the laws of theUnited States of America, with a principal business office located at 22 WestState Street, Media, Pennsylvania, 19063.

1.   DEFINITIONS.The following terms when used in this Agreement shall have the respectivemeanings set forth below:

1.1.          Assignments:Additional collateral for the Loan, including, without limitation, (i) aCollateral Assignment of Agreements Affecting Real Estate,including withoutlimitation, all approvals, permits, contracts and warranties related to the Land;and (ii) an Assignment of Rents, Profits and Leases.

1.2           Borrower: TransnationalIndustries, Inc., a Delaware corporation, and Spitz, Inc., a Delaware corporation,individually, collectively, jointly and severally.

1.3.          Closing Date:The date of the execution and delivery of this Agreement by Borrower andLender.

1.4.          Collateral: Thereal property and personal property pledged to Lender to secure the Loan pursuantto the Mortgage and the Assignments, including, without limitation, the Landand the improvements thereon.

1.5.          Commitment Letter:A certain Commitment Letter from Lender to Borrower dated December 19, 2004

1.6.          Event of Default:The occurrence of any event described in Paragraph 5.1 hereof.

1.7.          GovernmentalAuthority: The United States of America, the Commonwealth of Pennsylvania, andany political subdivision thereof in which the Land is located including withoutlimitation the County of Delaware, the Township of Chadds Ford, and any agency,department, court, commission, board, bureau or instrumentality of any of themwhich exercises jurisdiction over the Land or Borrower.

1.8.          Land: Thereal property currently occupied by Borrower located at Route 1, Chadds FordTownship, Delaware County, Pennsylvania, being Folio No. 04-00-00034-02, asmore particularly described on Exhibit “A” to the

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Mortgage, together withall of the property rights, title, interests, easements and other rightsappurtenant to such real property and defined in the Mortgage as the MortgagedProperty.

1.9.          LegalRequirements: All applicable laws, statutes, ordinances, rulings, regulations, codes,decrees, orders, judgments, conditions, restrictions and requirements of any GovernmentalAuthority, including, without limitation, agreements, requirements, restrictionsand conditions related to any permit, approval or other grant of authority.

1.10.        Loan: Thecredit facility of Three Million Two Hundred Thousand ($3,200,000.00) Dollarsto be advanced by Lender to Borrower pursuant to this Agreement and to beevidenced by the Note and secured by, among other things, the Mortgage and theAssignments.

1.11.        Loan Documents:All agreements, documents, instruments, certificates, legal opinions and otherpapers executed and delivered or otherwise furnished by Borrower to Lender in connectionwith the Loan including, without limitation, this Agreement, the CommitmentLetter, the Note, the Mortgage, and the Assignments.

1.12.        MaturityDate: January 13, 2024.

1.13.        Mortgage: Themortgage of even date herewith from Borrower to Lender granting a first lienmortgage and security interest in, among other things, (i) the Land, and (ii)all personal property of Borrower located on the Land.

1.14.        Note: Themortgage note of even date herewith from Borrower to Lender evidencing the Loanin the amount of Three Million Two Hundred Thousand ($3,200,000.00) Dollars andall extensions, renewals and modifications thereof.

1.15.        Permitted Exceptions:The title exceptions not removed at the closing of the Loan from Title InsuranceCommitment No. 03-1156 dated effective October 30, 2003, issued by StrongAbstract, Inc. agent for First American Title Insurance Company, as approved byLender in its sole discretion.

1.16.        Title Agent:Strong Abstract, Inc., agent for First American Title Insurance Company.

2.   LOAN.

2.1.          General.Borrower is the owner in fee of the Land. The Loan shall be repaid in full nolater than the Maturity Date, in accordance with this Agreement and the otherLoan Documents.

2.2.          Loan Amount.Subject to the terms and conditions of this Agreement, Lender shall lend toBorrower and Borrower shall borrow from Lender Three Million Two HundredThousand ($3,200,000.00) Dollars, which shall bear interest and be repaid asset forth in the Note.

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2.3.          Loan Disbursement.The purpose of the Loan is to finance Borrower’s acquisition of the Land. Theproceeds of the Loan shall be fully disbursed of even date herewith by check orwire transfer to the Title Agent to be applied on account of the purchase pricefor the Land.

3.   REPRESENTATIONSAND WARRANTIES. Borrower represents and warrants to Lender as of the datehereof and at all times when this Agreement shall remain in effect or the indebtednessevidenced by the Note shall remain outstanding that:

3.1.          Organizationand Good Standing. Borrower is/are duly organized, validly existing and in goodstanding under the laws of the State of Delaware and Spitz, Inc. is registeredas a foreign corporation and is in good standing in the Commonwealth of Pennsylvaniaand in any other jurisdiction in which Borrower was organized. The character ofthe properties owned or leased by Borrower and the nature of Borrower’s. businessesdo not require Borrower to be qualified and in good standing in any other statein order to avoid material liability or disadvantage. Certified copies ofBorrower’s organizational documents and all amendments thereto have beendelivered to Lender and are current, correct and complete as of the date hereof

3.2.          Power andAuthority. Borrower has full power and authority (i) to own Borrower’sproperties, and Spitz, Inc, has full power and authority to own the Land, and(ii) to conduct Borrower’s businesses as now conducted and as to be conducted inconnection with the operation of the Land. Borrower has full power and authorityto execute, deliver and comply with the provisions of each of the LoanDocuments executed by Borrower. Each of the Loan Documents executed by Borrowerconstitute the legally binding obligation of Borrower enforceable againstBorrower in accordance with its terms.

3.3.          NoLitigation. There is no action, suit or proceeding pending or, to the knowledgeof Borrower, threatened against or affecting Borrower or all or any portion ofthe Land or Borrower’s business, except actions, suits and proceedings fullycovered (except for deductibles) by insurance.

3.4.          Conflict. Neitherthe execution nor the delivery of any of the Loan Documents, nor theperformance or satisfaction by Borrower of any of the provisions thereof, willconflict with or result in a breach of any of the provisions of any applicable LegalRequirements, or any agreement or other instrument to which Borrower is a partyor by which Borrower is bound, or result in the creation or imposition of anylien, charge or encumbrance upon any property of Borrower, or the Land otherthan any lien created pursuant to any of the Loan Documents.

3.5.          Consent. Noconsent, approval or other authorization of or by any Governmental Authority isrequired in connection with the execution or delivery by Borrower of any of theLoan Documents, or compliance with or performance of any of the provisionsthereof.

3.6.          Permits and Approvals.Borrower has secured all licenses, permits, authorizations, consents and approvalsrequired by any Governmental Authority for the use and occupation of the Landas commercial real estate and the operation of Borrower’s business thereon.

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3.7.          Compliance: Zoning.Borrower has complied with all Legal Requirements and all recorded instruments affectingthe Land and the use thereof complies with all zoning and use-related LegalRequirements.

3.8.          Financial Statements.

3.8.1.       Thefinancial statements of Borrower delivered to Lender prior to the date hereof areBorrower’s most current financial statements and fully and accurately presentthe financial condition of Borrower as of the date thereof, in accordance withgenerally accepted accounting principles consistently applied. There are noliabilities or obligations of Borrower which are individually or in theaggregate material, either accrued, absolute, contingent or otherwise, except (i)to the extent set forth in the balance sheets and the notes thereto and notheretofore paid or discharged, and (ii) those incurred subsequent to the dateof the foregoing financial statements, which are consistent with past business practiceand in the normal and ordinary course of business.

3.8.2.       Since thedates of the foregoing financial statements, there has not been (i) anymaterial adverse change in the financial condition or in the operations, businessor property of Borrower or (ii) any damage, destruction or loss, whether or notcovered by insurance, materially and adversely affecting the operations,business or property of Borrower. Borrower is not aware of any fact or circumstance,which (with or without the passage of time or the giving of notice or both)would or could result in any such change.

3.9.          Taxes andAssessments. All federal, state and other tax returns and reports of Borrower requiredto be filed have been duly filed, and all federal, state and other taxes, assessments(including assessments for municipal improvements), fees or other governmental chargesimposed upon Borrower or the Land which are due and payable have been paid. Borroweris not aware of any proposed material tax or other assessments against it, or theLand, and no extension of time for assessment or payment of any federal, state orlocal tax by the Borrower is in effect, unless an extension has been applied forand granted and any taxes due with such extension paid.

3.10.        Title.

3.10.1.     Spitz, Inc.holds good, indefeasible and marketable fee simple title to the Land, free andclear of all mortgages, liens, encumbrances, ground rents, leases, tenancies, licenses,security interests, covenants, conditions, restrictions, rights-of-way, easements,encroachments and any other matters affecting title except (i) the Permitted Exceptions,and (ii) the liens and encumbrances created in favor of Lender pursuant to theLoan Documents.

3.10.2.     Lender’sright, title and interest in and to each of the agreements, documents, instruments,contracts, permits, licenses and other materials and assets, if any, assignedto Lender pursuant to this Agreement and the other Loan Documents are free andclear of all liens, encumbrances, leases, licenses, covenants, conditions, restrictions,security interests, other assignments and other matters affecting title (exceptthe Permitted Exceptions), and Borrower is

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permitted to assign suchagreements, documents, instruments, contracts, permits, licenses and othermaterials and assets. Borrower is without knowledge of the existence of anydefault under or breach of any of the foregoing.

3.10.3      Spitz, Inc. islawfully authorized to mortgage and encumber the Land.

3.10.4      Borrower hasnot created, and will not create, or permit or suffer to be created, any liens,encumbrances or security interests in or on the Land other than the Mortgage, orcreate, or permit or suffer to be created, any reservation of title by anyparty other than Lender with respect to any portion of the Land, other thanliens in favor of Lender.

3.11.        Utilities.All utility services necessary for the full use, development and enjoyment ofthe Land as currently improved, are available at no cost or expense at thetitle lines of the Land (or, if they pass through adjoining private land, inaccordance with valid public or unencumbered private easements which inure tothe benefit of Borrower and run with the Land, copies of which have beendelivered to Lender) including, without limitation, sanitary sewers, stormsewers, water, electricity, and telephone.

3.12.        Roads. TheLand is located along a dedicated public street, and if not located a dedicatedpublic street, access to the Land is insured, and all curb-cut and street openingpermits or licenses required for vehicular access to and from the Land to any adjoiningpublic street or highway have been obtained and paid for by Borrower and are infull force and effect. All roads necessary for the full utilization of the Landfor its intended purposes have either been completed or the necessary rights ofway therefore have been acquired by Borrower or by the appropriate GovernmentalAuthority having jurisdiction.

3.13.        Insurance. Nonotice has been received from any insurance company which issued any of the insurancepolicies or any of their agents, brokers or representatives, stating in effectthat any such policy (i) will not be renewed, (ii) will be renewed only at ahigher premium that is presently payable therefore, or (iii) will be renewed onlywith lesser or less complete coverage than is presently provided.

3.14.        No Default.No event has occurred and is continuing that is an Event of . Default or which wouldbe an Event of Default with the passage of time or the giving of notice orboth.

3.15.        Condemnation.There is no pending condemnation, expropriation, eminent domain or similarproceeding affecting the Land or any portion thereof, and Borrower had notreceived any written or oral notice of any thereof and has no knowledge that anysuch proceeding is contemplated.

3.16.        Leases: Agreementsfor Purchase. There are no leases or agreements of purchase and sale for all orany portion of the Land.

3.17.        Representationsand Warranties True and Correct. The representations and warranties of Borrowermade to Lender are true, correct and complete in every material respect. No representation,

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warranty or statement ofBorrower contained herein or in any of the Loan Documents or in any other document,instrument or certificate delivered to Lender pursuant hereto or in connection withthe transactions contemplated hereunder contains any untrue statement of anymaterial fact, or omits or shall omit to state a material fact the absence ofwhich makes such representation, warranty or statement misleading.

3.18         ComplianceWith Laws Respecting Acquisition. Borrower shall and has complied with all requirementsof local and state law in connection with the acquisition ofthe Land.

4.   COVENANTSOF BORROWER

4.1.          Affirmative Covenants.Borrower covenants and agrees that, from the date hereof and so long as thisAgreement shall remain in effect or the indebtedness evidenced by the Note shallremain outstanding, Borrower shall:

4.1.1.       Existence.Do or cause to be done all things necessary to preserve and keep Borrower’s legalexistence in full force and effect under the laws of the State of Delaware and Spitz,Inc.’s foreign registration in full force and effect under the laws of the Commonwealthof Pennsylvania and in any other jurisdiction in which Borrower may have beenorganized, and to remain and cause Borrower to remain qualified and licensed inall jurisdictions in which such qualification or licensing is required for theconduct of Borrower’s business, including, without limitation, Pennsylvania.Borrower shall promptly deliver to Lender any and all documents evidencing an amendmentto or modification of the articles of incorporation, certificate of organization,bylaws, operating agreements or other organization documents respectingBorrower.

4.1.2.       Required Notices.Give, or cause to be given, prompt written notice to Lender of (i) any actionor proceeding instituted by or against Borrower or the Land by or before any GovernmentalAuthority, or any such proceeding threatened against Borrower, the Land which,if adversely determined, could have a material and adverse effect upon the business,assets or condition (financial, legal or otherwise) of Borrower or the Land, (ii)any other action, event or condition of any nature which may have a materialand adverse effect upon the business or assets of Borrower or which, with thegiving of notice or the passage of time or both, would constitute an Event of Defaultunder this Agreement or a default under any other material contract, instrumentor agreement to which Borrower is a party or by which Borrower or any ofBorrower’s properties or assets may be bound or subject, or (iii) any action orproceeding respecting the current development and use of the Land forcommercial purposes.

4.1.3.       Payment ofDebts, Taxes. Pay and discharge or cause to be paid and discharged when due andprior to the accrual thereon of interest or penalty, all taxes, assessments andgovernmental charges or levies imposed upon the Land, Borrower or their incomeor receipts, or any of their properties, as well as all lawful claims forlabor, materials and supplies or otherwise which, if unpaid, might become a lienor charge upon such properties or any part thereof, unless the same shall be contestedby Borrower in good faith and with due diligence by appropriate proceedings andBorrower shall have posted a bond or escrow with Lender equal to such contestedamount.

4.1.4.       Compliance. Promptlyand faithfully comply with, conform to and obey all present and future Legal Requirementsapplicable to

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Borrower, or the Land,all present and future requirements affecting title to the Land, the LoanDocuments, all” agreements of purchase, if any, for all or any portion of the Land,and all leases now or hereafter entered into from time to time, and all otheragreements and covenants to which Borrower is bound or subject. Promptly and faithfullycomply with, conform to and obey all present and future orders, rules, regulationsand requirements of any national or local board of fire underwriters relating inany way to the Land or any portion thereof. Promptly pay all license and permitfees and similar municipal charges relating in any way to the Land or any portionthereof or the construction or use of any building and improvement placed or tobe placed upon and forming a part of the Land. Borrower shall immediately notifyLender of Borrower’ s receipt of notice from any Governmental Authority or any nationalor local board of fire underwriters relating to the construction, use or occupancyof the Land or any part thereof, or which requires any action to be taken with respectto the Land or any part thereof or which could have an adverse effect on theLand or any part thereof.

4.1.5.       Maintenance.Cause the Land to be kept in good condition and repair as set forth in the Mortgage,and operate the same properly, efficiently and in compliance with all LegalRequirements.

4.1.6.       Books and Records.Keep, or cause to be kept, in accordance with generally accepted accountingprinciples consistently applied, proper and complete books of record andaccount concerning affairs of Borrower and the Land and make such records availablein Borrower’s offices at all reasonable times upon reasonable prior notice for inspectionby Lender. Borrower agrees to maintain accounting records for the Land separatefrom any other accounting records which Borrower may maintain. Borrower agreesto retain all such books and records for a period of two (2) years after the repaymentin full of the Loan.

4.1.7.       FinancialStatements. So long as the Loan or any portion thereof remains outstanding, Borrower,at Borrower’s sole cost and expense, shall deliver or cause to be delivered toLender current and complete financial statements and other information on aconsolidated basis as follows:

a.             Within ninety(90) days following the end of Borrower’s fiscal year and each fiscal quarter, respectively,in each year, Borrower shall deliver to Lender the Borrower’s Annual Report onForm 10-KSB and quarterly report on Form 10-QSB, each of which will includefinancial statements consisting of a balance sheet, income statement andstatement of source and application of funds for Borrower. Such financial statementsfor Borrower (i) shall, in the case of the annual statements be accompanied byan audit opinion by a certified public accounting firm selected and paid for byBorrower and satisfactory to Lender (it being agreed that the Borrower’s certifiedpublic accounting firm as of the Closing Date is acceptable to the Lender), (ii)shall be prepared in accordance with generally accepted accounting principles consistentlyapplied, (iii) shall be in form reasonably satisfactory to Lender and (iv)shall be” certified as true, correct and complete by the Borrower’s chief financialofficer.

b.             Borrower shalldeliver to Lender such other financial information as to Borrower as Lenderfrom time to time may request, all such information to be provided in form and timeframe reasonably satisfactory to Lender.

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c.             Within thirty(30) days of the date the same are due for filing (including any available extensionsproperly applied for) Borrower shall deliver to Lender copies of Borrower’s FederalIncome Tax Returns. All copies of such returns shall be certified by Borroweras true and correct and as actually filed with the Internal Revenue Service.

Allsuch financial statements required by Lender hereunder shall be prepared in accordancewith generally accepted accounting principles consistently applied by anindependent certified public accountant acceptable to Lender. Borrower shallpromptly notify Lender in writing if there is any material adverse change sincethe date of the last preceding statement submitted to Lender in the financial positionof Borrower, and if there has been such a change, a detailed explanationthereof.

4.1.8.Change in Circumstances. Promptly notify Lender in writing of any change in anyfact or circumstance represented or warranted by Borrower herein or in any otherdocuments furnished to Lender in connection with this Agreement.

4.1.9.       Additional Instruments.Execute such additional instruments as may be requested by Lender in order tocarry out the intent of this Agreement and the other Loan Documents and toperfect or give further assurances of any of the rights granted or provided forhereunder or under any of the other Loan Documents.

4.1.10.     Indemnification.Indemnify, defend and hold harmless Lender and its officers, directors, employeesand agents from and against any and all liabilities, losses, claims, damagesand expenses, including reasonable attorneys’ fees and expenses, of any kind ornature directly or indirectly resulting from or arising out of the Loan, or theLoan Documents, or any act or omission by Lender or its officers, directors, employeesor agents, in connection therewith, including, without limitation, all claimsfor commissions by any broker or intermediary, disputes between or among Borrower,any Governmental Authorities, subcontractors, material suppliers, purchasers andtenants, unless caused by the gross negligence or willful malfeasance of Lenderor its officers, directors, employees or agents.

4.1.11.     Reimbursementof Costs. Reimburse Lender for all of Lender’s costs payable to third parties incidentalto the preparation and making of the Loan, including, without limitation, monthlycredit reports, recording fees, filing fees, surveys and premiums for title insuranceas may be required by Lender, the fees and expenses of any consultant employedby Lender, and all costs and expenses of Lender’s counsel relating to preparationor approval of any of the Loan Documents, examination of matters subject toLender’s approval and legal services rendered in connection with Borrower’s failureto perform in accordance with the Loan Documents or otherwise relating to thetransaction. All such costs billed at or prior to the Closing Date shall bepaid on or before the Closing Date.

4.1.12.     Notices.Forward to Lender copies of all notices given or received by Borrower to orfrom; (i) any purchaser or tenant for any portion of the Land, (ii) any subcontractoror material supplier respecting the Land, (iv) any insurer or insurance underwriters

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respecting the Land orBorrower’s business, (v) any utility company respecting the Land or the Borrower’sbusiness, or (vi) any Governmental Authority respecting the Land or theBorrower’s business (including, without limitation, notices of nonconformingconstruction, notices relating to Hazardous Materials and any EnvironmentalLaws as those terms are defined in the Note and Mortgage, and notice of inabilityto perform the terms of any contract or agreement), promptly upon the giving orreceipt of such notice.

4.1.13.     Loan Proceeds.Use Loan proceeds for the purposes identified in the Commitment and this LoanAgreement.

4.1.14.     Bank Accounts.Borrower shall maintain all deposit, operating and escrow accounts relating tothe Land with Lender.

4.1.15.     Inspection. PermitLender, its agents, employees and representatives, to enter and to inspect theLand at any reasonable time upon one (1) business day prior notice for thepurposes of making site and building investigations and performing soil, groundwater,structural and other tests. Lender, or any persons designated by it, shall havethe right to call at Borrower’s place or places of business at any reasonable timeupon one (1) business day notice, and without hindrance or delay, to inspect, audit,check and make extracts from Borrower’s books, records, journals, orders, receiptsand any correspondence and other data relating to the Borrower’s business or toany other transactions between the parties hereto, and shall have the right tomake direct verification from the account debtors with respect to any or allaccounts.

4.2.          NegativeCovenants. Borrower covenants and agrees that from the date hereof and for solong as this Agreement shall remain in effect or the indebtedness evidenced bythe Note shall remain outstanding, Borrower shall not:

4.2.1.       Amendment orModification. Amend, vary or modify, or permit to be amended, varied ormodified, any agreement, document or instrument assigned to Lender.

4.2.2.       Conveyance. Sell,assign, transfer, convey, lease or otherwise dispose of the Land, or any part thereofor interest or estate therein, or otherwise permit ownership or control of theLand or any portion thereof to be other than in Spitz, Inc.

4.2.3.       Governing Documents,Directors. Amend, or permit to be amended, the governing documents pursuant towhich Borrower was organized and is operating or permit a change of themajority of the members of the board of directors of Borrower during any twelve(12) month period.

4.2.4.       Encumbrances.Create by mortgage, pledge, assignment, security agreement or otherwise, orsuffer to exist, any security interest, pledge, lien, charge or otherencumbrance upon the Land or any portion thereof, except (i) the liens or securityinterests created pursuant to the Loan Documents or other liens or security interestsin favor of Lender; (ii) mechanics or tax liens being contested by Borrower ingood faith and due diligence in appropriate proceedings with the approval ofLender, a bond or escrow having been posted with Lender for the full amount ofsuch contested lien; and (iii) with the prior written consent of Lender,easements and licenses for the operation of the Land.

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4.2.5.       OtherBorrowing and Guaranties. Undertake any additional financing in connection withthe purchase or improvement of the Land or any part thereof, or borrow, in theaggregate, any sum in excess of Two Hundred Thousand ($200,000.00) from anyperson or persons, or assume, guaranty, endorse or otherwise become contingentlyliable upon, or responsible for, the obligation of any person other than as expresslyprovided in the Loan Documents, if to do so in the judgment of Lender would havea material adverse impact on the financial condition or status of Borrower.

5.   EVENTSOF DEFAULT AND REMEDIES.

5.1.          Events of Default.The occurrence of anyone or more of the following shall constitute an “Event ofDefault” hereunder:

5.1.1.       The occurrenceof an event of default under the Note or any other Loan Document.

5.1.2.       The issuanceof any levy, writ or process of execution or attachment against Borrower or anyproperty or assets of Borrower, including without imitation the Land, or thelevy or service of any such writ.

5.1.3.       The entry orfiling of any judgment, lien, encumbrance, notice oflien, attachment, levy orany other adverse charge against Borrower or the Land or any portion thereof whichis not discharged within twenty (20) days unless it is being contested byBorrower in good faith and due diligence in appropriate proceedings with the approvalof Lender, a bond or escrow having been posted with Lender for the full amountof such contested lien.

5.1.4.       The failureof Borrower to comply with the requirements of any Governmental Authority concerningthe Land unless the same shall be contested by Borrower in good faith and withdue diligence by appropriate proceedings and Borrower shall have posted a bondor escrow with Lender in an amount satisfactory to Lender.

5.1.5.       The failureof Borrower to maintain any insurance or policy of insurance required by this Agreementor the Mortgage for a period in excess often (10) days from the date of writtennotice from Lender of the lapse or absence of any such insurance or policy of insurance.

5.1.6.       The failureof Borrower to provide or furnish to Lender within thirty (30) days of writtenrequest, proof of any insurance or policy of insurance required by thisAgreement or the Mortgage.

5.1.7.       The failureof Borrower to provide or furnish to Lender within thirty (30) days of writtenrequest, any financial statement, tax return or other information required tobe delivered to Lender pursuant to this Agreement or any other Loan Document.

5.1.8.       The failureof Borrower to comply, after any applicable notice or cure period, with any requirementsof any recorded instrument or other agreement concerning the Land.

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5.1.9.       The makingby Borrower of any amendment to or modification to any document, instrument oritem which has been approved by Lender in accordance with the provisions hereof

5.1.10.     The failureby Borrower to pursue promptly and with due diligence and in good faith anyremedy under any contract or agreement with respect to the Land available asthe result of any material default by the other party thereto.

5.1.11.     The failureof Borrower to perform or comply with any of the terms, conditions, provisions,agreements and covenants contained herein or in any of the Loan Documents or inany other document, agreement or instrument given by or in behalf of Borrower inconnection with the Loan.

5.1.12.     The default byBorrower or any affiliate, owner or subsidiary thereof, under any other loansor indebtedness between Lender and Borrower or any affiliate, owner or subsidiarythereof, including without limitation the occurrence of an event of default underthat certain Line Of Credit Agreement dated June 12, 1997 between Lender and Borrower,amended by that certain Modification Agreement dated July 7, 2000, and further amendedby that certain Second Modification Agreement dated July 18, 2002, respecting aTwo Million ($2,000,000.00) Dollar commercial revolving line of credit.

5.1.13.     The falsity orincorrectness, regarded by Lender as material, of any representation orwarranty made to Lender, or any financial statement given to Lender, byBorrower in or in connection with the Loan, this Agreement or any of the LoanDocuments.

5.2.          Remedies.Upon the occurrence of any Event of Default, Lender may exercise as it may deemnecessary or appropriate, any one or more of the following rights and remedies:

5.2.1.       Declare immediatelydue and payable all sums under the Note which are then unpaid, together withall accrued interest.

5.2.2.       Exercise anyother right or remedy provided herein, in any of the Loan Documents, at law orin equity.

5.3.          Verificationof Amounts Due/Declaration of No Set-Off. In any action or proceeding for recoveryof any sums expended by Lender in connection with the operation and/or maintenanceof the Land or otherwise due to Lender pursuant to the terms hereof, a statementof such expenditures, verified by the affidavit of an officer of Lender, shallbe prima facie evidence of the amounts so expended and of the propriety of and necessityfor such expenditures, and the burden of proving the contrary shall be uponBorrower. Within ten (10) days after being requested to do so by Lender, Borrowershall furnish to Lender or to any assignee of the Note and/or the Mortgage, awritten statement in form and substance satisfactory to Lender stating the entireoutstanding amount of the indebtedness evidenced by the Note and stating that Borrowerhas no offsets, recoupments, counterclaims or defenses or, if such offsets, recoupments,counterclaims or defenses are alleged to exist, the nature and extent thereof. Inthe event Borrower fails to furnish to Lender a written statement within ten(10) days after being requested to do so, or if such

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statement does notcontain all of the information required, then except to the extent set forth inBorrower’s timely delivered written statement, Borrower shall be deemed toaccept and concur with Lender’s statement of the entire outstanding amount ofthe indebtedness evidenced by the Note and agree that Borrower has no offsets,recoupments, counterclaims or defenses.

5.4.          Borrower’s Property.As security for the Loan and for the obligation and liabilities of Borrowerhereunder and under each of the Loan Documents, Lender is hereby given a lienupon and a security interest in all funds and property of Borrower which mayhereafter be deposited with or come into the possession of Lender, and for suchpurpose this Agreement shall constitute a security agreement under the PennsylvaniaUniform Commercial Code and Lender shall have all rights and may exercise allof the remedies of a secured party under the applicable provisions of the PennsylvaniaUniform Commercial Codes with respect to such funds and property of Borrower.

5.5.          Remedies Cumulative.The rights and remedies of Lender provided for in this Agreement, in any of theother Loan Documents, and in any other instrument, document or agreement givenby or on behalf of Borrower in connection with the Loan, shall be cumulativeand concurrent and shall not be exclusive of any right or remedy provided bylaw, in equity or otherwise. Said rights and remedies may, at the sole and exclusivediscretion of Lender, be pursued singly, successively or together, and may beexercised as often as occasion therefore shall arise. No grace period, qualificationor condition stated with respect to any Event of Default shall change, modify, amendor extend, or will be construed as an undertaking by Lender to change, modify, amendor extend the time for making any installment due under the Note or theMaturity Date, which time for making any installment and Maturity Date remainalways of the essence of this Agreement.

5.6.          Lender’sRight to Remedy Defaults. If Borrower fails to pay when due any sum required tobe paid by Borrower or fails to perform any obligation of Borrower hereunder, Lender,at its option; upon at least ten (10) days prior notice to Borrower, shall havethe right, but not the obligation, to pay any such sum and to perform any such obligationand Lender shall have the right, but not the obligation, to pay any sum or to takeany action which Lender deems necessary or advisable to protect the security forthe Loan including without limitation the Mortgage and the Land, all withoutprejudice to any of Lender’s rights or remedies available hereunder or underany of the Loan Documents or under any other documents or instrument given byor on behalf of Borrower in connection with the Loan, at law, or in equity. Theamount of all payments so made by Lender, together with all costs so incurredby Lender, shall immediately be due and payable from Borrower to Lender, togetherwith interest at the rate set forth in the Note in the event of a default. Allsuch amounts, together with interest as aforesaid, shall be added to andevidenced by the Note and be secured by the Mortgage, and Lender may charge allsuch amounts and interest as advances of the Loan and may deduct such amountsand interest as advances of the Loan thereafter to be advanced hereunder fromany funds or property deposited by Borrower with Lender.

6.   INSURANCE.

6.1.          Coverage. Borrowershall, from and after the date hereof and at all times while this Agreement is ineffect or the Note remains outstanding, maintain at Borrower’s sole expense, insurancein amounts, with deductibles satisfactory to Lender written by stock ornonassessable

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mutual carriers licensedin Pennsylvania with a general policy holders rating of “A” or better and afinancial rating of VI or better in the most recent edition of “Best’s KeyRating Guide, Property-Casualty”, published by Alfred M. Best Co., Inc. Withoutlimiting the generality of the foregoing, Borrower shall maintain the followingminimum coverages, unless otherwise agreed to in writing by Lender:

6.1.1.       All risk, fire,hazard and extended coverage insurance with vandalism and malicious mischief endorsementson all buildings and structures to the extent of one hundred percent (100%) ofthe replacement value thereof pursuant to full replacement value endorsements namingLender as mortgagee and additional insured pursuant to a standard mortgageeloss payable clause, and;

6.1.2.       Commercialgeneral public liability insurance covering all operations of Borrower in connectionwith the Collateral, with contractual liability endorsement, naming Lender asadditional insured in amounts not less than: (i) bodily injury: $3,000,000,000 foreach occurrence, $3,000,000,900 in the aggregate, and (ii) property damage: $1,000,000,000for each occurrence, and $3,000,000_000 in the aggregate; and

6.1.3.       Rent insuranceagainst loss of income arising out of damage or destruction by fire or the perilsof extended coverage insurance, in an amount equal to one (1) year’s grossrental income to the owner of the Land, or business interruption insurance inan amount as required by Lender from time to time, but not to exceed Mortgagee’sreasonable estimate of the annual cost of debt service on the Note, taxes;insurance and maintenance for the Land.

6.2.          Certificates;Notices.

6.2.1.       Borrowershall furnish to Lender, certificates certifying to the insurance required byParagraph 6.1, (as Lender may request) and expressly granting Lender the same protectionsas if Lender held the original policies, (i) on or before the closing date, (ii)no fewer than twenty (20) days prior to the renewal or replacement of existingcoverage or the obtaining of additional coverage, and (iii) at any other timeupon the request of Lender.

6.2.2.       Each insurancepolicy of Borrower shall contain a provision (i) requiring the insurer tonotify Lender, in writing and at least thirty (30) days in advance of any cancellation,expiration or material change in the policy, and (ii) stating that any loss otherwisepayable thereunder shall be payable notwithstanding any act or neglect of theinsured and notwithstanding ( a) any change in title to or ownership of the Landor (b) any provision of the policy relieving the insurer thereunder ofliability for any loss by reason of the existence of other policies of insurancecovering the Land against the peril involved, whether or not collectible, providedsuch coverage is available to Borrower at reasonable cost.

6.2.3.       If theinsurance, or any part thereof, shall expire, or be withdrawn, or become voidor unsafe, in the opinion of Lender, by reason of Borrower’s breach of anycondition thereof, or become void or unsafe, in the opinion of Lender, byreason of the failure or impairment of the capital of any company issuing such certificates,Borrower shall place new insurance in accordance with this Agreement. Allrenewal policies, with premiums paid, shall be delivered to Lender at least thirty(30) days prior to the expiration of the existing policies.

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6.2.4.       Theinsurance described in Paragraph 6.1 hereof shall not provide for deductiblesin excess of amounts approved by Lender and, though obtained, maintained andpaid for by Borrower, shall provide that loss thereunder shall be payable toLender under a standard mortgagee’s loss payee clause.

6.3.          Lender MayProvide Insurance. In any instance where insurance is not provided by Borroweras required hereunder, Lender may at its option, but shall not be required to, securesuch insurance as Lender deems appropriate to cover Lender’s interests, withoutobligation to insure Borrower’s interests, and charge the cost of the same toBorrower, to be secured by the Loan Documents.

7.   MISCELLANEOUS.

7.1.          Lender’sDiscretion. If any condition of this Agreement requires the submission ofevidence of the existence or non-existence of a specified fact or facts, orimplies as a condition the existence or non-existence of such fact or facts, Lenderwill, at all times, be free independently to establish to its satisfaction andin its discretion (unless otherwise specified) such existence or non-existence.Where any matter herein requires the approval or consent of the Lender, the decisionto give or refuse to give such approval or consent shall be within Lender’sdiscretion unless otherwise specified.

7.2.          No Third-PartyBeneficiary. The parties do not intend the benefits of this Agreement to inureto any third party or any of their respective creditors for debts or claims accruingto any such persons against Borrower. Lender shall not be liable for the mannerin which any advance may be applied by Borrower. Notwithstanding anything containedherein or in any of the other Loan Documents, or any conduct or course of conductby or between Borrower and Lender before or after the execution of this Agreement,this Agreement shall not be construed as creating any right, claim or cause ofaction against Lender or any of its officers, directors, agents or employees, infavor of any other person other than Borrower. Without limiting the generalityof the foregoing, any advances made to any insurer, contractor, subcontractor orsupplier of labor or materials or other creditor of Borrower, whether or notsuch advances are approved by Lender, shall not be deemed a recognition byLender of third party beneficiary status of any such person. No part of theLoan will be at any time subject or liable to attachment or levy at the suit ofany creditor of Borrower, or of any contractor, subcontractor or supplier of labor,materials or services, or any of their respective creditors, and regardless ofany other term, condition or provision hereof, no such third party will haveany status, right or entitlement hereunder.

7.3.          Reliance on Representationsand Warranties. Lender shall be entitled to rely upon the representations and warrantiesof Borrower set forth in any of the Loan Documents without any investigation byLender and notwithstanding any investigation conducted by Lender or on its behalfbefore or after the date hereof.

7.4.          Assignment.

7.4.1.       The rightsof Borrower hereunder and under any other Loan Document shall not be assignablein any respect without the prior

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written consent ofLender, which consent may be granted or withheld in Lender’s sole discretion. Inany case, Borrower shall remain liable for repayment of all sums advanced hereunderbefore and after such assignment.

7.4.2.       All or any portionof the Loan or any of the Loan Documents may be endorsed, assigned ortransferred in whole or in part by Lender, and any such holder or assignee thereofshall succeed to and be possessed of the rights of Lender under the Loan Documentsto the extent so endorsed, transferred or assigned.

7.4.3.       Subject tothe foregoing, this Agreement shall be binding upon, and shall inure to thebenefit of, Borrower and Lender and their respective personal representatives,heirs, successors and assigns.

7.5.          Communications.All communications required or permitted by this Agreement shall be in writing andshall be deemed to have been given or made when hand delivered or delivered byguaranteed overnight delivery, or upon deposit in the United States mail, postageprepaid, certified or registered mail, return receipt requested, addressed asfollows:

7.5.1.       If toLender:

First Keystone Bank22 West State StreetMedia, Pennsylvania 19063Attention: A. Charles Amentt, Jr.Senior Vice President, Lending

                With arequired copy to:

Donn L. Guthrie, Esquire10 Beatty Road Media, Pennsylvania 19063

7.5.2.       If toBorrower:

TransnationalIndustries, Inc. and Spitz, Inc. P.O. Box 198 Route 1 Chadds Ford, Pennsylvania 19317

                With arequired copy to:

Steven G.Brown, Esquire Petrikin, Wellman, Damico, Brown & Petrosa 109 Chesley Drive Media, Pennsylvania 19063

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orin any case to such other address as either party may designate from time totime by notice to the other in the manner set forth herein.

7.6.          Headings. Theheadings preceding the text of the sections and subsections of this Agreementare used solely for convenience of reference and shall not affect the meaningor interpretation of this Agreement.

7.7.          Time of the Essence.All dates and times for performance set forth herein or in any of the other LoanDocuments (whether or not elsewhere so stated) are of the essence.

7.8.          No Brokers. Borrowerrepresents and warrants that Borrower has taken no action which would or might renderit liable for payment of any brokerage or placement fees or commissions onaccount of the transactions contemplated by the Loan Documents, and Borrowerwill indemnify, defend and hold harmless Lender from any claims made inconnection therewith.

7.9.          Governing Law.The Agreement and all questions relating to its validity, interpretation, performanceand enforcement (including, without limitation, provisions concerning limitationsof actions), shall be governed by and construed in accordance with the laws ofthe Commonwealth of Pennsylvania, notwithstanding any conflict-of-laws doctrinesof such state or other jurisdiction to the contrary, and without the aid of anycanon, custom or rule of law requiring construction against the draftsman.

7.10.        Severability.Any provision in any of the Loan Documents which is determined to be unenforceableor invalid shall be ineffective to the extent of such unenforceability or invaliditywithout affecting the remaining provisions thereof.

7.11.        Survival.All agreements, representations and warranties made in this Agreement shallsurvive the closing hereunder and the making of all advances hereunder.

7.12.        Entire Agreement:Controlling Document; Amendment. This Agreement, together with the exhibitshereto, which are incorporated herein by reference, and the other LoanDocuments embody the entire agreement and understanding between Borrower andLender with respect to the subject matter hereof and supersede all prior commitments,agreements and understandings relating to the subject matter hereof. Theprovisions of this Agreement (including the exhibits attached hereto) shall bedeemed complementary to the provisions of the other Loan Documents, but in the eventof conflict, the provisions hereof shall be deemed to modify and supersede the conflictingprovisions in such other Loan Documents and to control to the extent enforceableunder applicable law. Neither this Agreement nor any of the other Loan Documentsmay be modified or amended except by a written agreement executed by the party againstwhich enforcement is sought.

7.13.        Indulgences,Etc. Neither the failure nor any delay on the part of either party to exercise anyright, remedy, power or privilege under this Agreement (a “Right”) shalloperate as a waiver thereof, nor shall any single or partial exercise of anyRight preclude any other or further

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exercise of the same orof any other Right, nor shall any waiver of any Right with respect to anyoccurrence be construed as a waiver of such Right with respect to any other occurrence.No waiver shall be effective unless it is in writing and. is signed by theparty asserted to have granted such Waiver.

7.14         Counterparts.This Agreement may be executed in one or more counterparts, via facsimiletransmission or otherwise, each of which will be deemed an original, but all ofwhich together will constitute one and the same instrument.

7.15.        TRIAL BYJURY. BORROWER AND LENDER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVEANY RIGHT EITHER MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASEDHEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH, THIS AGREEMENT, THENOTE, THE MORTGAGE, ANY OTHER DOCUMENT OR INSTRUMENT RELATING HERETO OR THERETO,ANY OTHER TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY OR ANY COURSE OF CONDUCT,COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THELENDER OR BORROWER IN CONNECTION HEREWITH OR THEREWITH. THIS PROVISION IS A MATERIALINDUCEMENT FOR THE LENDER TO MAKE THE LOAN EVIDENCED BY THE NOTE.

[THISSPACE INTENTIONALLY LEFT BLANK. SIGNATURE PAGE FOLLOWS.]

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INWITNESS WHEREOF, and intending to be legally bound hereby, Borrower and Lender,have caused this Agreement to be duly executed under seal as of the date firstabove written.
|   | LENDER:                         |
|--------|---------------------------------|
|   |                            |
|   | FIRST KEYSTONE  BANK            |
|   |                            |
|   |                            |
|   | BY:                             | /s/ A. Charles Amentt, Jr. |
|   |                            |
|   |                            |
|   | BORROWER:                       |
|   |                            |
|   | TRANSNATIONAL  INDUSTRIES, INC. |
|   |                            |
|   | BY:                             | /s/ Jonathan Shaw |
|   |                            |
|   |                            |
|   | ATTEST:                         | /s/ Paul Dailey |
|   | [Corporate Seal]                |
|   |                            |
|   |                            |
|   | SPITZ, INC.                     |
|   |                            |
|   | BY:                             | /s/ Jonathan Shaw |
|   |                            |
|   | ATTEST:                         | /s/ Paul Dailey |
|   | [Corporate Seal]                |
|        |                                 |  |  |

 

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