BUSINESS LOAN AGREEMENT

This BUSINESS LOAN AGREEMENT is entered into as of the 1st
day of February, 2000, by and between H BAR C, INC., a Delaware
corporation (the "Company"), and LOS ANGELES COMMUNITY DEVELOPMENT
BANK (Not a Commercial Bank), a California corporation licensed
under the California Finance Lenders Law, Division 9 ("Lender").

The loan represented by the Note, as defined herein, is made
pursuant to the California Finance Lenders' Law, Division 9
(commencing with Section 22000) of the California Financial Code.
FOR INFORMATION, CONTACT THE DEPARTMENT OF CORPORATIONS, STATE OF
CALIFORNIA (Reference No. 603-4580).

WHEREAS, Shootout Mountain Outfitters and Dry Goods, Inc., a
North Carolina corporation ("Shootout Mountain") is currently in
default on its promissory notes dated October 7, 1997, in the
amount of $200,000.00, and November 20, 1997, in the amount of
$616,387.63, both made pursuant to that certain Amended and
Restated Business Loan Agreement dated as of October 7, 1997,
between Shootout Mountain and Lender;

WHEREAS, Roger Cook and Mary-Elizabeth D. Wallenius
("Guarantors") are in default of their guaranties, each in the
amount of $850,000.00, of the indebtedness of Shootout Mountain to
Lender;

WHEREAS, Lender and the Company have agreed that, in exchange
for the Company's performance of the terms and conditions of this
Agreement, and the release by Shootout Mountain and Guarantors of
claims against Lender, Lender will release Shootout Mountain and
Guarantors from their obligations to Lender recited above;

THEREFORE, to induce Lender to extend credit and financial
accommodations to the Company and for good and valuable
consideration, the receipt and sufficiency of which is
acknowledged hereby, the parties hereto agree as follows,
intending to be legally bound.

SECTION 1.  DEFINITIONS AND GENERAL RULES.  The following
definitions and general rules will apply hereto:

1.1  General Rules.  For the purposes of this Agreement:

(1)  The terms defined in this Section 1, unless the
context requires otherwise, will have the meanings applied to them
in Section 1 and will include the plural as well as the singular.
Additional definitions may be found in the preamble and
throughout this Agreement;

(2)  All accounting terms not otherwise defined herein
will have the meanings assigned to them in accordance with
generally accepted accounting principles consistently applied;

(3)  The words "herein," "hereof," "hereunder" and
words of similar import refer to this Agreement as a whole and not
to a particular section, paragraph or other subdivision;

(4)  Any reference to any financing document or other
document shall include such document both as originally executed
and as it may from time to time be renewed, restated, supplemented
or modified.  References herein to Sections or Exhibits shall be
construed as references to this Agreement unless a different
document is named.  References to subsections or paragraphs shall
be construed as references to the same section in which the
reference appears.  References to "including" shall be construed
to mean "including without limitation"; and

(5)  All Exhibits to this Agreement, as now existing and as
the same may from time to time be supplemented and modified, are
incorporated herein by this reference.

1.2  Definitions.  As used in this Agreement, the following
terms will have the following meanings unless the context requires
otherwise:

(1)  "Affiliate" of a Person means any Person that or
who, directly or indirectly through one or more intermediaries,
controls, is controlled by, or is under common control with such
Person.  For the purposes of this definition, "control"
(including, with correlative meanings, the terms "controlled by"
and "under common control with"), as used with respect to any
Person, means the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of
such Person, whether through voting power, by contract or
otherwise.

(2)  "Agreement" means this Business Loan Agreement as
originally executed or hereafter amended, together with the HUD
Addendum and all exhibits and schedules attached to this
Agreement.

(3)  "Business Day" means a day (other than Saturday,
Sunday or a legal holiday) on which banks in Los Angeles,
California, are open for business.

(4)  "Call Option" has the meaning assigned to it in Section 4.2.

(5)  "CERCLA" means the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended.

(6)  "City Target Area" has the meaning assigned to it in the HUD Addendum.

(7)  "Closing" means the execution and delivery to
Lender of this Agreement and all Related Documents, the recording
and filing of such Related Documents as required under this
Agreement, and the Company's issuance of the Shares to Lender as
required under this Agreement.

(8)  "Closing Date" means the Closing Date established pursuant to
Section 8.1 below and effectuated pursuant to Section 8.4 below.

(9)  "Collateral" means the properties and assets described in Section
3.4 hereof.

(10)  "Company" means H BAR C, INC.

(11)  "Default" means any event specified in Section 7.1
of this Agreement, regardless of whether any requirement for the
giving of notice or lapse of time or any other condition has been
satisfied.

(12)  "Empowerment Zone" means that certain area of the
City of Los Angeles defined and described as the City of Los
Angeles Supplemental Empowerment Zone in Exhibit 1.2(12) hereto,
which is incorporated herein by this reference.

(13)  "ERISA" means the Employment Retirement Income
Security Act of 1974, as amended from time to time.

(14)  "Event of Default" means any event specified in
Section 7.1 of this Agreement, provided that any requirement in
connection with such event for the giving of notice or lapse of
time or any other condition has been satisfied.

(15)  "Guaranties" means the guaranties, given by
Guarantors to Lender, each in the amount of $850,000.00, of the
indebtedness of Shootout Mountain to Lender;

(16)  "Guarantors" means Roger Cook and Mary-Elizabeth D. Wallenius.

(17)  "Hazardous Substances" means any substance,
chemical, waste or other material that is listed, defined, or
otherwise identified as hazardous, toxic or dangerous under
CERCLA, SARA, the Hazardous Materials Transportation Act, 49
U.S.C. Section 1801 et seq., the Resource Conversion and Recovery Act,
42 U.S.C. Section 6901 et seq., Chapters 6.5 through 7.7 of Division 20
of the California Health and Safety Code, Section 25100 et seq., or
other applicable state or federal laws, rules or regulations
adopted pursuant to any of the foregoing or under any other
applicable law, regulation or order of any governmental body; as
well as any petroleum, petroleum product or by-product, crude oil,
natural gas, natural gas liquids, liquefied natural gas, or
synthetic gas usable for fuel, and "source", "special nuclear",
and by-product" material as defined in the Atomic Energy Act of
1985, 42 U.S.C  Section 3011 et seq.

(18)  "HUD" means the U.S. Department of Housing and Urban Development.

(19)  "HUD Addendum" means that certain HUD Addendum to Loan Agreement,
including all appendices and exhibits thereto, attached hereto and
executed concurrently herewith.

(20)  "Indebtedness" means the total liabilities of a
Person calculated in accordance with generally accepted accounting
principles consistently applied.

(21)  [This section intentionally left blank.]

(22)  "Lender" means Los Angeles Community Development
Bank (Not a Commercial Bank), and its successors and assigns.

(23)  "Lien" means any interest in property securing an
obligation owed to, or a claim by, a Person other than the owner
of the property, whether such interest is based on the common law,
statute or contract, and including but not limited to the security
interest lien arising from a mortgage, encumbrance, pledge,
conditional sale or trust receipt or a lease, consignment or
bailment for security purposes.  The term "Lien" shall include
reservations, exceptions, encroachments, easements, rights-of-way,
covenants, conditions, restrictions, leases and other title
exceptions and encumbrances affecting the property.  For the
purposes of this Agreement, a Person shall be deemed to be the
owner of any property that it or he has acquired or holds subject
to a conditional sale agreement, financing lease or other
arrangement pursuant to which title to the property has been
retained by or vested in some other Person for security purposes.

(24)  "Note" means a promissory note to Lender,
substantially in the form attached hereto as Exhibit 1.2(24), to
be executed by the Company, as the same may be renewed, extended
or rearranged at any time.

(25)  "Obligations" means the obligations and
liabilities of the Company to Lender evidenced by the Note and any
and all other Indebtedness, liabilities and obligations whatsoever
of the Company to Lender, whether direct or indirect, absolute or
contingent, due or to become due, and whether now existing or
hereafter arising, and howsoever evidenced or acquired, whether
joint or several, and whether evidenced by note, draft,
acceptance, guaranty, open account, letter of credit, surety
agreement or otherwise; its being contemplated by the parties
hereto that the Company may become indebted to Lender in further
sum or sums.

(26)  "Permitted Liens" means: (i) liens and security
interests securing Indebtedness owed by the Company to Lender;
(ii) liens for taxes, assessments, or similar charges not yet due;
and (iii) any other liens and security interests that, as of the
date of this Agreement, have been disclosed to and approved in
writing by Lender.

(27)  "Person" means any corporation, partnership, trust, estate,
individual, unincorporated business entity or governmental
department, administrative agency or instrumentality.

(28)  "Plan" means any plan subject to Title IV of ERISA
and maintained by the Company or any Subsidiary or any such plan
to which the Company or any Subsidiary is required to contribute
on behalf of its employees.

(29)  "Put Option" has the meaning assigned to it in Section 4.1.

(30)  "Regulation U" means Regulation U of the Board of
Governors of the Federal Reserve System, 12 C.F.R., Part 221.

(31)  "Regulation X" means Regulation X of the Board of
Governors of the Federal Reserve System, 12 C.F.R., Part 224.

(32)  "Reimbursement Note" means a promissory note to
Lender, substantially in the form attached hereto as Exhibit
1.2(32), to be executed by the Company, as the same may be
renewed, extended or rearranged at any time.

(33)  "Related Documents" means the HUD Addendum, the
Note, the Reimbursement Note, the Security Agreement, together
with all financing statements and other documents necessary for
recordation of the same or perfection of the liens, mortgages and
security interests granted thereby.

(34)  "SARA" means the Superfund Amendments and
Reauthorization Act of 1986, as now existing or hereafter amended.

(35)  "Security Agreement" means a security agreement, in
substantially the form attached hereto as Exhibit 1.2(35), to be
executed on behalf of the Company.

(36)  "Shares" means 250,000 shares of the Company's
common stock, to be issued to Lender at the Closing.

(37)  "Shootout Mountain" means Shootout Mountain Outfitters and Dry
Goods, Inc.

(38)  "Shootout Mountain Related Documents" has the meaning
assigned to the term "related documents" in the Amended and
Restated Business Loan Agreement dated as of October 7, 1997,
between Shootout Mountain and Lender, and includes the Guaranties.

(39)  "Subordinated Indebtedness" means the Indebtedness
of a Person, calculated in accordance with generally accepted
accounting principles consistently applied, heretofore or
hereafter incurred, that, by the express terms of the instrument
evidencing or creating such Indebtedness or by the terms of a
subordination agreement in form and substance satisfactory to
Lender, is validly and effectively made subordinate and subject in
right to payment, to whatever extent Lender may require, to the
prior payment of the Note to Lender.

(40)  "Subsidiary" means any corporation of which more
than 50 percent of the issued and outstanding securities having
ordinary voting power for the election of directors is owned or
controlled, directly or indirectly, by a Person and, or, one or
more of its Subsidiaries.

SECTION 2.  REPRESENTATIONS AND WARRANTIES.  The Company
represents, warrants and agrees as follows:

2.1  Corporate Authority.  The Company is a corporation duly
incorporated, validly existing and in good standing under the laws
of the state of its incorporation and is duly licensed, qualified
to do business and in good standing in each jurisdiction in which
the ownership of its property or the conduct of its business
requires such licensing and qualification, and has all powers and
all permits, consents and authorizations necessary to own and
operate its properties and to carry on its business as presently
conducted.  The execution, delivery and performance of this
Agreement by the Company, the borrowings under this Agreement and
the execution and delivery of the Related Documents and the
several agreements and instruments contemplated thereby, (i) have
been duly authorized by proper corporate proceedings, and (ii)
will not contravene, or constitute a default under, any provision
of applicable law or regulation or of the Articles of
Incorporation or Bylaws of the Company, or of any mortgage,
indenture, contract, agreement or other instrument, or any
judgment, order or decree, binding upon the Company.  No consent
of the Company's shareholders or any holder of any Indebtedness of
the Company is required as a condition to the validity of this
Agreement.  This Agreement, the Related Documents and the several
agreements and instruments contemplated thereby, when duly
executed and delivered in accordance with this Agreement, will
constitute legal, valid and binding obligations of the Company in
accordance with their respective terms.

2.2  Financial Statements.  The Company will not commence
business until after the Closing Date, and, as of the Closing has
no debt that is secured by any assets of the Company; and
therefore has no financial statements at December 31, 1999, or
related statements of income and retained earnings and changes in
financial position or results of operations or changes in its
financial position for the year then ended.

2.3  Governmental Approvals.  No approvals of any
governmental department, administrative agency, instrumentality or
authority having jurisdiction over the Company are necessary to
permit the Company to enter into this Agreement and the Related
Documents, to borrow hereunder and to grant security and guaranty
as provided herein.

2.4  Litigation.  There is no action, suit or proceeding
pending or, to the knowledge of the Company, threatened against
the Company before any court, governmental department,
administrative agency or instrumentality which, if such action,
suit or proceeding were adversely determined, (i) would subject
the Company to any liability not fully covered by insurance, or
(ii) would materially adversely affect the financial position or
the results of operations of the Company or its businesses or the
ability of the Company to perform its obligations under this
Agreement or the Related Documents.

2.5  No Event of Default.  No Default or Event of Default
has occurred and is continuing.

2.6  Properties.   The Company has and will continue to have
good and indefeasible title to all of its assets and properties,
free and clear of all liens, mortgages, security interests and
other encumbrances, except as provided herein.

2.7  Investment Company Act of 1940.  The Company is not an
investment company within the meaning of the Investment Company
Act of 1940.

2.8  Tax Returns.  The Company has filed all United States
tax returns and all city, state and foreign tax returns required
to be filed by it and has paid, or made provisions for the payment
of, all taxes which have become due pursuant to any such return or
pursuant to any assessment received by the Company, except such
taxes and assessments, if any, as are being contested in good
faith and as to which adequate reserves have been provided in
accordance with generally accepted accounting principles, and such
returns properly reflect any United States income tax, foreign
tax, state tax and city tax of the Company for the periods covered
thereby.

2.9  Liens and Security Interests.  The security interests,
mortgages and liens attaching to the Collateral will constitute at
all times valid, perfected and enforceable first priority security
interests, mortgages and liens in favor of Lender, subject to no
prior or superior lien, mortgage, security interest or other
encumbrance, except as permitted in this Agreement.  Before
executing the Note, the Company will have taken, or will have
participated with Lender in taking, all necessary action
(including making all necessary filings) to provide Lender with
first priority perfected security interests, mortgages and liens
in the Collateral (other than Collateral subject to Permitted
Liens) under the laws of all applicable jurisdictions.

2.10  Availability of Records.  The Company will permit any
representative, accountant, officer, employee, or attorney of
Lender to (i) visit and inspect any of the properties of the
Company, (ii) examine the books and financial records of the
Company, and (iii) discuss the affairs, finances and accounts of
the Company with its officers and independent certified public
accountants, all at such reasonable times and during reasonable
business hours, and as often as Lender may deem necessary.  As of
the date of this Agreement, the Company's place of business is
located at 14600 South Main Street, Gardena, California 90248.
Unless the Company has designated otherwise in a writing accepted
by Lender in writing, this location is also the office or offices
at which the Company keeps all of its records concerning the
Collateral.

2.11  Regulations U and X.  No part of the proceeds received
by the Company hereunder will be used, directly or indirectly, for
the purpose of purchasing or carrying, or for payment in full or
in part of Indebtedness which was incurred for the purpose of
purchasing or carrying, any "margin stock," as such term is
defined in Regulation U.  No part of the proceeds received by the
Company from the loans made hereunder will be used for any purpose
that violates Regulation X.

2.12  Subsidiaries.  The Company has no Subsidiaries or investments in any
Person.

2.13  ERISA.  The Company is in compliance in all material
respects with the applicable provisions of ERISA and, to the best
of the Company's knowledge, no "reportable event," as such term is
defined in Section 4043 of ERISA, has occurred with respect to any
Plan of the Company.

2.14  Solvency.  Upon the receipt of the capital of capital
contemplated in Section 6.2(f), the Company (i) will have assets
with a present fair value that exceeds the amount that will be
required to pay the probable liability on existing debts as they
become absolute and matured; (ii) anticipates that it will be able
to meet its debts as they mature, and (iii) will have adequate
capital to conduct the businesses in which it is engaged.

2.15  Hazardous Substances.  (a)  During the period of
ownership, possession or use of any real or personal property by
the Company, whether prior to or during the tern of this Agreement
(collectively referred to herein as the "properties"), there has
been and will be no use, generation, manufacture, storage or
treatment, or "disposal," "release" or "threatened release," as
those terms are defined in statutes referred to in Section 1.2(17)
herein, of any Hazardous Substance by any Person on, under, about
or from any of the properties; (b)  the Company has no knowledge
of, or reason to believe that there has been, (i) any 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 properties by any prior owners or
occupants of any of the properties, or (ii) any actual or
threatened litigation or claims of any kind by any person relating
to such matters; and (c) neither the Company, the Partnership, nor
any tenant, contractor, agent, or other authorized users of any of
the properties shall use, generate, manufacture, store, treat,
dispose of, or release any Hazardous Substance on, under, about or
from any of the properties; and any such activity shall be
conducted in compliance with all applicable federal, state and
local laws, regulations, and ordinances, including without
limitation those laws, regulations and ordinances described in
Section 1.2(17) above.  The Company authorizes Lender and its
agents to enter upon the properties to make such inspections and
tests as Lender may deem appropriate to determine compliance of
the properties with this paragraph.  Any inspections or tests made
by Lender shall be at the Company's expense and for Lender's
purposes only, and shall not be construed to create any
responsibility or liability on the part of Lender to the Company
or to any other Person, nor shall Lender's failure to inspect the
properties constitute a waiver of any of Lender's rights or the
Company's obligations hereunder.  the representations and
warranties contained herein are based on the Company's due
diligence in investigating the properties for Hazardous
Substances.  The Company hereby (a) releases and waives any future
claims against Lender for indemnity or contribution in the event
the Company becomes liable for cleanup or other costs under any
such laws, and (b) agrees to indemnify and hold harmless Lender
against any and all claims, losses, liabilities, damages,
penalties, and expenses, including attorneys' fees and costs, that
Lender may directly or indirectly sustain or suffer resulting from
a breach of this paragraph of the Agreement or as a consequence of
any use, generation, manufacture, storage, disposal, release or
threatened release occurring prior to the Company's ownership or
interest in the properties, whether or not the same was or should
have been known to the Company.  The provisions of this Section
2.15 of the Agreement, including the obligation to indemnify,
shall survive the payment of the Indebtedness of the Company
hereunder and the termination or expiration of this Agreement, and
shall not be affected by Lender's acquisition of any interest in
any of the properties, whether by foreclosure or otherwise.

2.16  Information.  There is no fact that the Company has
not disclosed to the Lender in writing that materially and
adversely affects, or, so far as the Company can now foresee to
the best of its knowledge and belief, is reasonably likely to
prove to affect materially and adversely the business, operations,
properties, prospects, profits or condition (financial or
otherwise) of the Company or its properties, or the ability of the
Company to perform this Agreement.  All information furnished by
the Company to Lender for the purposes of or in connection with
this Agreement or any transaction contemplated hereby is, and all
information hereafter furnished by or on behalf of the Company to
Lender will be, true and accurate in every material respect on the
date as of which such information is dated or certified; and none
of such information is or will be incomplete by omitting to state
any material fact necessary to make such information not
misleading.  If the Company discovers that any information
previously furnished by it to Lender was not true and accurate in
any material respect, it will immediately provide Lender with
information necessary to make the previously provided information
true and accurate; however, by accepting such information, Lender
does not waive any Event of Default or any rights it may have with
respect to the materially untrue, inaccurate or misleading
information previously provided.

2.17  Stock.  As of the Closing Date, the Company shall have only one
class of shares of its stock, which shall be common voting shares.

2.18  Material Adverse Change.  As of the Closing Date, there
shall not have occurred, in Lender's sole and absolute judgment, a
material adverse change in the business, operations, properties,
assets, liabilities, financial condition or prospects of the
Company or in the value of any Collateral, excepting damage and/or
diminution to material stored at 14600 South Main Street, Gardena,
California, that Lender and the Company are aware of.

2.19  Survival of Representations and Warranties.
Notwithstanding the fact that Lender is or may engage in some
investigation and review of the Company's affairs, the Company
understands and agrees that Lender is relying and shall be
entitled to rely upon the above representations and warranties in
making the loans represented by the Notes; and any such
investigation or review shall not limit Lender's rights and
remedies hereunder, under any Related Document or under applicable
law.  The Company further agrees that the foregoing
representations and warranties shall be continuing in nature and
shall remain in full force and effect until such time as (i) the
Company's Indebtedness shall be paid in full, (ii) the earlier of
(A) the date that the Lender cease to own any of the Shares or (B)
the expiration of the Put Option, or (iii) this Agreement shall
have been terminated in the manner provided above, whichever is
the last to occur.  The Company agrees and acknowledges that the
granting, renewing, or extending of any loan by Lender at all
times shall be at Lender's sole judgment and discretion.

SECTION 3.  THE LOAN.

3.1  The Note.  Subject to, and upon the terms, conditions,
covenants and agreements contained herein, at the time of the
Closing, the Company shall execute the Note evidencing the
Company's obligation to pay to the Lender the sum of One Hundred
Seventy-Five Thousand Dollars ($175,000.00) in seven monthly
installments.  The Note will be secured by the Collateral pursuant
to the Security Agreement

All renewals, extensions, modifications and rearrangements of
the Note, if any, shall be deemed to be made pursuant to this
Agreement and, accordingly, shall be subject to the terms and
provisions hereof, and the Company shall be deemed to have
ratified, as of such renewal, extension, modification or
rearrangement date, all of the representations, warranties,
covenants and agreements set forth herein.

3.2  Optional Prepayments.  The Company, at its option,
without notice, premium or penalty, may prepay the Note in full at
any time or from time to time in part.  Prepayment of the Note
shall not in any way affect Lender's rights or obligations under
Section 4 of this Agreement.

3.3  Payments.

(a)  All payments of principal of and interest on the
Note shall be made to Lender at its office set forth in Section 10.7.

(b)  Whenever any payment of principal of or interest
on the Note shall be due on a day which is not a Business Day, the
date for payment thereof shall be extended to the next succeeding
Business Day and interest shall be payable for such extended time
at the rate of interest with respect thereto in effect at the due
date.

3.4  Security.

(a)  Payment of the Note and the performance of the
covenants set forth in this Agreement will be secured, directly or
indirectly, by a first priority (except in the case of Permitted
Liens) perfected security interest, mortgage, assignment or lien,
as the case may be, in and upon the following described property
and assets (the "Collateral"):  All of the Company's assets,
including present and future accounts, inventory, equipment,
fixtures, documents, instruments, general intangibles (including
goodwill, trademarks, service marks and trade names, trade
secrets and other intellectual property), chattel paper (as such
terms are defined in the California Commerce Code as presently
enacted or hereafter amended (the "UCC")), notes receivable,
drafts, acceptances and contract rights now owned or existing and
hereafter acquired or arising, wherever located, and all the
proceeds thereof, which property and assets are more particularly
described in, and which security interests will be evidenced by,
the Security Agreement.

(b)  The Company agrees to execute, acknowledge and/or
deliver to Lender such instruments, mortgages, chattel mortgages,
deeds of trust, security agreements, statements, assignments and
financing statements, in form and substance acceptable to Lender
as in the good faith and discretion of counsel for Lender may be
necessary to enforce, grant to Lender and perfect in the United
States the security interests, liens, assignments and mortgages on
the Collateral.

SECTION 4.  THE SHARES.

4.1  Put Option.  On or before September 1, 2000, the
Company will notify Lender by writing sent to the offices of
Lender set forth in Section 10.7 that Lender shall have 60
calendar days to elect to sell all or part of the Shares to the
Company (the "Put Option") at a price of Four Dollars ($4.00) per
share.  In the event that the notice is not made by September 1,
2000, the price of the Put Option shall increase by $.05
effective October 1, 2000, and shall increase by an additional
$.05 every 30 days thereafter until such notice is made.  Lender
shall exercise the Put Option by sending the notice in the form
of Exhibit 4.1 to the Company in the manner specified in Section
10.7.  The Put Option will expire if Lender sells all of its
Shares, or if Lender sells less than all of its Shares and
receives total compensation equaling or exceeding the amount it
would have received from the Company had the Put Option been
exercised on all of the Shares at the price of the Put Option in
effect on the date the Bank receives such total compensation. In
the event that Lender intends to sell any Shares (other than to
the Company) prior to expiration of the Put Option, Lender will
notify the Company of such intent not less than 48 hours prior to
effecting or becoming contractually committed to effecting such
sale; and, within 10 days after any such sale,  will provide the
Company with confirmation of effectiveness of the sale and the
price of at which such Shares were sold.

4.2  Call Option.  In the event that Lender does not elect
to sell all of the Shares to the Company pursuant to Section 4.1,
the Company shall have the right to purchase any remaining Shares
from Lender at a price of Eight Dollars ($8.00) per share until a
date that is twenty-four (24) months after the Closing Date (the
"Call Option").  The Company shall exercise the Call Option by
sending the notice in the form of Exhibit 4.2 to the Lender in
the manner specified in Section 10.7.  If the notice specified in
section 4.1(a) is not made on or before September 1, 2000, the
Call Option shall be canceled.

4.3  Payment for Shares by the Company.  Lender shall
receive payment in immediately available funds from the Company
for Shares purchased by the Company pursuant to Sections 4.1 or
4.2 within ten (10) business days after the notice required
pursuant to Section 4.1 or 4.2, respectively, is sent.

4.4  Change in Corporate Structure or Capital Stock.  In the
event (i) that the Company shall at any time subdivide or combine
its outstanding common stock, or fix a record date for payment of
a dividend in common stock or other securities of the Company
exercisable, convertible or exchangeable for common stock, (ii)
that shares of the Company's common stock shall be changed into
the same or a different number of shares of any other class or
classes of common equity securities, whether by capital
reorganization, reclassification, or otherwise, or (iii) of
merger or consolidation of the Company with or into another
corporation, or the sale of the Company's properties and assets
as, or substantially as, an entirety to any other person, then
upon such event Lender, as holder of the Shares, shall be
entitled to the same rights as any other shareholder of the
Company, and after that event, the total compensation for all
equity securities held by Lender as a result of such event in a
transaction pursuant to Section 4.1 or 4.2 above shall not be
less than the compensation that would have been received pursuant
to Section 4.1 or 4.2 for the Shares in the absence of such
event.

SECTION 5.  AFFIRMATIVE COVENANTS OF THE COMPANY.  Until the later
of the date that (i) the Note has been paid in full, and (ii)
either (A) the Company's performance of its Obligations under the
Put Option, or (B) the expiration of the Put Option with Lender
having not exercised such Put Option, the Company agrees as
follows, unless compliance with the provisions of the following
subsections shall have been waived in writing by Lender (the
Company's request for which shall not be unreasonably withheld):

5.1  Financial and Payroll Statements.  The Company will
furnish the following to Lender:

(a)  As soon as available, a copy of its annual
financial statements (consisting of at least a balance sheet and
related statements of income, retained earnings, source and
application of funds and changes in financial condition) prepared
in conformity with generally accepted accounting principles
applied on a basis consistent with that of the preceding fiscal
year, and reviewed by an independent certified public accountant
selected by the Company and acceptable to Lender;

(b)  As soon as available, but in any event, within 120
days after the end of each fiscal year of the Company after 1999,
a copy of its annual audited financial statements (consisting of
at least a balance sheet and related statements of income,
retained earnings, source and application of funds and changes in
financial condition) prepared in conformity with generally
accepted accounting principles applied on a basis consistent with
that of the preceding fiscal year, and certified (with an
unqualified opinion) by an independent certified public accountant
selected by the Company and acceptable to Lender;

(c)  As soon as available, but in any event, within 30
days of the end of each quarter of each fiscal year during the
term hereof, unaudited interim financial statements of the Company
prepared and certified by a proper accounting officer of the
Company, prepared similarly to the audited statements referred to
in clause (b) above (subject to normal year-end audit
adjustments), reviewed by an independent certified public
accountant selected by the Company and acceptable to Lender, and
consisting of at least balance sheets as of the close of such
period and profit and loss statements for the quarter then ended
and for the period from the beginning of the fiscal year to the
close of such period;

(d)  Concurrent with filing, but in any event by
October 30 of each year, a copy of the federal income tax return,
or any request for extension of time to file same, of the Company
for the current fiscal year then ended, certified by a proper
financial officer of the Company;

(e)  The Company's annual Cash Flow projections
prepared on a quarterly basis and certified by a proper accounting
officer of the Company, and delivered thirty (30) days prior to
the end of each fiscal year of the Company, including a monthly
capital expenditures budget and supporting maintenance schedules;

(f)  As soon as available and in no event later than
fifteen (15) days after the end of each quarter of each fiscal
year, a copy of the Company's payroll journal prepared by the
Company's payroll processing company, or if none, by the Company,
as of the end of the last full payroll period of such quarter;

(g)  Such other financial and other information
concerning the Company as Lender shall reasonably request from
time to time;

(h)  (A) Promptly after the filing thereof with the
United States Secretary of Labor or the Pension Benefit Guaranty
Corporation, copies of each annual and other report with respect
to each Plan or any trust created thereunder, and (B) immediately
upon becoming aware of the occurrence of any "reportable event,"
as such term is defined in Section 4043 of ERISA, or of any
"prohibited transaction," as such term is defined in Section 4975
of the Internal Revenue Code of 1954, as amended, in connection
with any Plan or any trust created thereunder, a notice signed by
the President or a principal financial officer of the Company
specifying the nature thereof, what action the Company is taking
or proposes to take with respect thereof and, when known, any
action taken by the Internal Revenue Service with respect thereto;

5.2  Payment of Obligations.  The Company will pay and
discharge when due all of its Indebtedness and all Obligations,
except those being contested in good faith by appropriate
proceedings, and against which the Company has set up adequate
reserves in accordance with generally accepted accounting
principles, including, without limitation, its Obligations
pursuant to Section 4.3.

5.3  Notice; Litigation.  The Company shall promptly give
written notice to Lender of (i) the occurrence of any Default or
Event of Default, (ii) any legal, judicial or regulatory
proceedings affecting the Company or any of its properties or
assets in which the amount involved is material, is not covered
(subject to normal deductibles) by insurance and is likely to have
a material adverse effect on the business or the financial
condition of the Company, (iii) any dispute between the Company
and any governmental regulatory body or other Person that is
likely materially to interfere with the normal business operations
of the Company, (iv) any substantial damage to any material part
of the Collateral, specifying the nature and extent of damage and
whether such damage is being repaired in due course, or total loss
or destruction of any material part of the Collateral, (v) any
other action, event or condition of any nature of which it has
knowledge which may have, or lead to, or result in, any material
adverse effect upon the business, assets or financial condition of
the Company, all taken as a whole, and (vi) the voluntary or
involuntary bankruptcy of, or any assignment for the benefit of
creditors or the seeking of any relief under any bankruptcy or
other similar laws by, the Company.

5.4  Maintenance of Corporate Existence and Properties.  The
Company will (i) continue to engage in the businesses presently
being operated, (ii) maintain its corporate existence and good
standing in each jurisdiction in which it is required to be
qualified, (iii) keep and maintain all franchises, licenses and
properties useful and necessary in the conduct of its business in
good order and condition, and (iv) duly observe and conform to all
material requirements of any governmental authorities relative to
the conduct of its business or the operation of its properties or
assets, if such failure duly to observe and conform to said
requirements would have a material adverse effect or could result
in criminal prosecution.  The Company will notify Lender
immediately if inventory changes location or is delivered into the
custody of a warehouseman, bailee, or processor.

5.5  Insurance.  The Company will maintain insurance in such
form, in such amounts and against such risks (including, without
limitation, fire and other risk insurance, public liability
insurance, workers compensation) as is customarily carried by
companies engaged in the same or similar businesses, operating
like properties and similarly situated, plus any additional
insurance, if any, required in the Related Documents or as Lender
may reasonably require with respect to the Company's properties
and operations.  The Company will have the right to place any such
insurance with any with financially sound and responsible
insurance carrier licensed to do business in the State of
California and acceptable to Lender, provided that in no event
will such carrier have general policyholder's ratings of less than
"A" or financial ratings of less than "X" as rated in the most
currently available Best's Insurance Reports.  At Closing, and
thereafter upon the request of Lender, the Company will furnish
Lender certificates of insurance in form satisfactory to Lender
(as well as a copy of the policies if requested by Lender),
including a stipulation that coverages will not be canceled or
diminished without at least ten (10) days' prior written notice to
Lender, and proof of payment of the premiums therefor.  In
connection with all policies covering assets in which Lender holds
or is offered a security interest for the Loan, the Company will
provide Lender with such loss payable or other endorsements as
Lender may require.

Upon request by Lender, the Company shall furnish to Lender
reports on each existing insurance policy showing such
information as Lender may reasonably request, including, without
limitation, the following:  (i) the name of the insurer; (ii) the
risks insured; (iii) the amount of the policy; (iv) the
properties insured; (v) the then current property values on the
basis of which insurance has been obtained, and the manner of
determining those values; and (vi) the expiration date of the
policy.  In addition, upon request of Lender (not more often than
once per calendar year), the Company will have an independent
appraiser satisfactory to Lender determine, as applicable, the
actual cash value or replacement cost of any Collateral.  The
cost of such appraisal(s) shall be paid by the Company.  If the
Collateral shall be damaged or destroyed, in whole or in part, by
fire or other casualty, the Company shall give prompt notice
thereof to Lender.

5.6  Taxes, Charges and Liens.  The Company will pay and
discharge when due all of its debts and obligations, including,
without limitation, all taxes, assessments, governmental charges,
levies and liens, of every kind and nature, imposed upon any
Collateral, upon the Company, and/or upon any of the Company's
other properties, income, or profits, prior to the date on which
penalties would attach, and all lawful claims that, if unpaid,
might become a lien or charge against the Company or upon any of
the Company's properties, income, or profits.  In the event the
Company contests any such assessment, tax, charge, levy, lien or
claim, the Company shall nonetheless pay the same in a timely
manner and thereafter seek a refund thereof.  The Company, upon
the demand of Lender, shall furnish to Lender evidence of payment
of such assessments, taxes, charges, levies, liens and claims and
will authorize the appropriate governmental official to deliver to
Lender at any time a written statement of any assessments, taxes,
charges, levies, liens and claims against the Company or the
Company's properties, income or profits.

5.7  Accounts Receivable and Payable.  The Company will pay
its accounts payable and will maintain its accounts receivable in
a manner consistent with normal business practices, including
normal terms and conditions for payment, for companies engaged in
similar operations in similar jurisdictions.

5.8  Further Assurances.  The Company and the Guarantors, at
any time and from time to time, will execute and deliver such
further instruments and take such further action as may reasonably
be requested by Lender, in order to cure any defects in the
execution and delivery of, or to comply with or accomplish the
covenants and agreements contained in, this Agreement or the
Related Documents.

5.9  Inspection.  The Company will permit Lender (and any
person appointed by Lender to act for it and on its behalf) to
examine its corporate and financial books and records and other
records, books and properties and to discuss its affairs, finances
and accounts with the officers of the Company and the Company's
independent certified public accountants at all reasonable times
and as often as may be reasonably requested by Lender.

5.10  Jobs Creation. The Company shall create twenty-five
(25) full time jobs within two years after the Closing Date on its
payroll pursuant to the plan submitted as Appendix A to the HUD
Addendum.

5.11  Performance.  The Company shall perform and comply with
all terms, conditions, and provisions set forth in this Agreement
and in the Related Documents in a timely manner, and promptly
notify Lender if the Company learns of the occurrence or existence
of any Event of Default under this Agreement or any Related
Document, or any condition, act or event that, with the giving of
notice or the passage of time or both would constitute such an
Event of Default.

5.12  Operations.  The Company shall (i) maintain executive
and management personnel with substantially the same or better
qualifications and experience as the executive and management
personnel as of the Closing Date; (ii) provide written notice to
Lender of any change in executive and management personnel; (iii)
conduct its business affairs in a reasonable and prudent manner
and in compliance with all applicable federal, state and municipal
laws, ordinances, rules and regulations respecting its properties,
charters, businesses and operations, including, without
limitation, compliance with the Americans with Disabilities Act
and with all minimum funding standards and other requirements of
ERISA and other laws applicable to the Company's employee benefit
plans.

5.13  Environmental Laws.  The Company shall comply in all respects with
all federal, state and local environmental protection laws,
statutes, regulations and ordinances; shall not cause or permit to
exist, as a result of an intentional or unintentional action or
omission on its part or on the part of any other Person, on
property owned and/or occupied by the Company, any environmental
activity where damage may result to the environment, unless such
environmental activity is pursuant to and in compliance with the
conditions of a permit issued by the appropriate federal, state or
local governmental authorities; and 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 the Company's part in connection with any
environmental activity whether or not there is damage to the
environment and/or other natural resources.

5.14  HUD Compliance.  The Company shall strictly comply with
the HUD Addendum and all of the applicable requirements of HUD.
Upon request of Lender, the Company shall provide a certificate
acceptable to Lender, certifying the Company's compliance with the
Addendum and such applicable requirements as of the date of the
certificate.

5.15  Notice of Put Option.  The Company shall issue the notice of the
Put Option required by section 4.1 on or before September 1, 2001.

5.16  Covenants Surviving Payment of the Company's
Obligations.  For a period of two years after the Closing Date,
irrespective of whether the Company has any Indebtedness or
Obligations to Lender pursuant to this Agreement or the Related
Documents, whether Lender owns any Shares, or whether the Put
Option or the Call Option remains outstanding, , unless compliance
with the provisions of the following subsections shall have been
waived in writing by Lender, the Company agrees as follows:

(a)  As soon as available, but not later than thirty (30) days after
the end of each quarter of each fiscal year, the Company will furnish
to Lender a copy of the Company's quarterly California Employment Development
Department Report of Wages (Form DE-6); and,

(b)  Lender shall have the right, but not the
obligation, to participate in any press release, public
appearance, or public announcement (other than reports, filings or
testimony required to be made or given to any governmental agency
or judicial or legislative body) issued or made by the Company
with respect to its business operations, projections, products,
employment, or expansion.

5.17  Piggy-Back Registration:

(a)  Lender will be entitled to "piggy-back"
registration rights on Company registrations before the fifth
anniversary of the effective date of the Company's first
registration statement. Despite the foregoing statement, if such
registration involves an underwriting, Lender agrees to enter into
an underwriting agreement with an underwriter selected by the
Company, and that, in that event, the Company and its underwriters
shall have the authority, in view of market conditions, to reduce
the number of shares of Lender proposed to be registered (pro rata
as between holders of all of the Company's issued shares and all
other holders of shares with piggy-back registration rights).

(b)  The registration expenses (exclusive of
underwriting discounts, selling commissions, and special counsel
fees of more than one counsel for the selling shareholders) of one
demand registration under (a) above will be borne by the Company,
and all other expenses of registered offerings shall be borne pro
rata among the selling shareholders and, if it participates, the
Company.

Notwithstanding anything to the contrary in this Section 5, the
covenant in this subsection 5.17 shall survive for as long as
Lender shall own any Shares.

5.18  Location in Empowerment Zone.  Within 210 days after
the Closing Date, the Company's principal manufacturing operations
will be located in the Empowerment Zone and will be maintained in
the Empowerment Zone thereafter.

SECTION 6.  NEGATIVE COVENANTS OF THE COMPANY.

6.1  Until the later of the date that (i) the Note has been
paid in full, (ii) the Reimbursement Note has been paid in full
and (iii) either (A) the Company's performance of its Obligations
under the Put Option, or (B) the expiration of the Put Option
with Lender having not exercised such Put Option, the Company
agrees as follows, unless compliance with the provisions of the
following subsections shall have been waived in writing by Lender
(the Company's request for which shall not be unreasonably
withheld and which request will be deemed approved if not acted
upon by the close of business of the tenth day after Lender
receives actual written notice in the manner specified in Section
10.7):

(a)  Limitations on Contingent Liabilities.  The
Company will not create, assume or suffer to exist any liability,
direct or indirect, for or in connection with the obligations,
stock or dividends of any other Person, whether by guaranty,
endorsement, agreement to purchase or repurchase, agreement to
lease, agreement to supply or advance funds (including, without
limitation, agreements to maintain working capital, solvency or
other balance sheet conditions or agreements to purchase stock or
make capital contributions) or otherwise, except (i) as permitted
hereunder, (ii) for endorsements of instruments for collection in
the ordinary course of business, and (iii) any such liability in
favor of Lender.

(b)  Loans and Advances.  The Company will not make or
permit to remain outstanding any advances, loans or extensions of
credit to any Person, except accounts, instruments, documents,
chattel paper and general intangibles (as defined in the UCC),
arising or acquired in the ordinary course of business,

(c)  Limitations on Fundamental Changes; Disposition of
Assets.  Except in connection with any  merger or consolidation
with another entity, the Company will not (i) cease operations or
liquidate or dissolve itself (or suffer any liquidation or
dissolution), (ii) convey, sell, lease, charter or otherwise
dispose of all or any substantial part of its property, assets or
business, or (iii) except in the ordinary course of business,
enter into any arrangement, directly or indirectly, whereby the
Company would sell or transfer any properties, either now owned or
thereafter acquired, and then or thereafter lease as lessee such
properties or any part thereof or any other property to be used
for substantially the same purpose.

(d)  Subordination of Claims.  The Company will not
subordinate or permit to be subordinated any claim against, or
obligation of, another Person held or owned by it to any other
claim against, or obligation of, such other Person.

(e)  ERISA Compliance.  The Company will not permit at
any time any Plan maintained by it to:

(i)  Engage in any "prohibited transaction," as such term is defined
in Section 4975 of the Internal Revenue Code of 1954, as amended;

(ii)  Incur any "accumulated funding deficiency," as such term is defined in
Section 302 of ERISA; or

(iii)  Terminate any such Plan in a manner that
could result in the imposition of a lien on the property of the
Company pursuant to Section 4068 of ERISA.

(f)  Leases.  The Company will not enter into any new
leases in any year during the term hereof.  During the first 180
days after the Closing Date, Lender shall not withhold consent to
any new lease solely for the reason that the premises are not in
the Empowerment Zone.

(g)  Supply and Purchase Contracts.  The Company will
not enter into or be a party to any contract for the purchase of
materials, supplies or other property if such contract requires
that payment for such materials, supplies or other property shall
be made, regardless of whether or not delivery of such materials,
supplies or other property is ever made or tendered.

(h)  Transactions with Affiliates and Other Persons.
The Company will not engage in any transaction with an Affiliate
on terms less favorable to it than would be obtainable at the time
in comparable transactions with Persons not affiliated with the
Company.  The Company will not incur, create or assume any
commitments to make payments, whether as rental or otherwise,
under any lease, rental or other arrangement, written or oral, for
the use of any other Person if, under the terms of any such
agreements, the amount of rentals payable thereunder is greater
than the rentals presently paid by the Company.

(i)  Dividends.  The Company will not declare or pay
any dividend (other than dividends payable solely in stock) or
make any other distribution on account of, or purchase, acquire,
retire, or redeem any stock of the Company whether now owned or
hereafter outstanding, without the prior written consent of
Lender, which consent may be withheld by Lender in its sole and
absolute discretion provided, however, that notwithstanding the
foregoing, but only so long as no Event of Default has occurred
and is continuing or would result from the payment of dividends,
if the Company is a "Subchapter S Corporation" (as defined in the
Internal Revenue Code of 1986, as amended), the Company may pay
cash dividends on its capital stock to its shareholder from time
to time in amounts necessary to enable the shareholder to pay
income taxes and make estimated income tax payments to satisfy
such shareholder's liabilities under federal and state law that
arise solely from his status as shareholder of a Subchapter S
corporation because of his ownership of shares of capital stock of
the Company.  The covenant in this subsection 6.14 will expire
upon the later of the date that the Company has paid all
Obligations under the Note and the date that the Put Option
expires.

6.2  Until the Note and the Reimbursement Note have been
paid in full, the Company agrees as follows, unless compliance
with the provisions of the following subsections shall have been
waived in writing by Lender (the Company's request for which shall
not be unreasonably withheld and which request will be deemed
approved if not acted upon by the close of business of the tenth
day after Lender receives actual written notice in the manner
specified in Section 10.7):

(a)  Limitations on Liens.  The Company will not
create, assume or suffer to exist any mortgage, lien, pledge,
charge, security interest or other encumbrance of any kind upon
any of its properties or assets, whether now owned or hereafter
acquired, except (i) liens created by the Related Documents or
this Agreement, (ii) liens for taxes, assessments and other
governmental charges not yet payable, or the validity of which are
being contested in good faith by appropriate proceedings and as to
which adequate reserves have been set aside on the books of the
Company, (iii) deposits or pledges to secure the payment of
workmen's compensation, unemployment insurance or other social
security benefits or obligations, public or statutory obligations,
surety or appeal bonds or other obligations of a like general
nature incurred in the ordinary course of business, (iv)
landlords', mechanics', materialmen's, warehousemen's, carriers',
vendors' or other like liens arising by operation of law in the
ordinary course of business securing obligations which are not
overdue for a period longer than 30 days, or which are being
contested in good faith by appropriate proceedings and against
which the Company has provided adequate reserves in accordance
with generally accepted accounting principles, (v) zoning
restrictions, easements, licenses, restrictions on the use of real
property or minor irregularities in title thereto which do not
materially impair the use of such property in the operation of the
business of the Company or the value of such property, (vi)
inchoate liens arising under ERISA to secure current service
pension liabilities as they are incurred under the provisions of
Plans from time to time in effect, (vii) liens permitted in the
Related Documents or otherwise by Lender in writing.

(b)  Investments.  The Company will not make
investments in any Person and will not purchase, create or acquire
any interest in any real property..

(c)  Limitations on Fundamental Changes; Disposition of
Assets.  The Company will not (i) form any new Subsidiary, (ii)
enter into any merger or consolidation with any other entity,
(iii) or sell any of its accounts.

(d)  Nature of Business.  The Company will not (i)
engage in any lines of business or business ventures other than
those in which Shootout Mountain is presently engaged or that are
directly related thereto or (ii) carry on its business at any
location or locations other than those presently in existence for
Shootout Mountain.  During the first 180 days after the Closing
Date, Lender shall not withhold consent to any change of location
solely for the reason that the premises are not in the Empowerment
Zone.

(e)  Capital Expenditures.  Without the waiver(s)
required by this Section 6.2, the Company will not expend or enter
into any commitment to expend an amount in the aggregate of
$250,000.00 for the acquisition or lease of tangible, fixed or
capital assets, including repairs, replacements and improvements;
after an aggregate of $1,000,000.00 has been expended, without the
waiver(s) required by this Section 6 the Company will not expend
or enter into any commitment to expend an amount in the aggregate
of $100,000.00 for such assets; and after an aggregate of
$1,500,000.00 has been expended, without the waiver(s) required by
this Section 6 the Company will not expend or enter into any
commitment to expend an amount in the aggregate of $25,000.00 for
such assets.

(f)  Capital Stock.  The Company shall not issue any of
its capital stock or any right to acquire any of its capital stock
(except for (i) shares in the Company, not to exceed 100,000
shares, issued as compensation for services performed in
connection with this agreement and transaction; and (ii) private
placement issuance(s) of shares in exchange for up to $11
million).  The Company shall not purchase or retire any of its
outstanding capital stock, or alter or amend its capital
structure.

(g)  Corporate Identity.  The Company will not change
its name, its identity as a corporation or its corporate
structure.

SECTION 7.  DEFAULT.

7.1  Events of Default.  The occurrence of any of the
following events or conditions shall constitute an "Event of
Default":

(a)  Failure of the respective parties to this
Agreement to pay any principal of or interest on either of the
Note or to perform any of the Obligations when due or declared
due;

(b)  Any representation or warranty made by any of the
Company in this Agreement or in any of the Related Documents or in
any certificate, financial or other statement furnished by the
Company pursuant hereto or thereto or in connection herewith or
therewith is untrue in any material respect as of the date made or
furnished;

(c)  Default in the observance or performance of any of
the covenants, terms or agreements of this Agreement (including,
without limitation, the covenant in Section 5.10 of this Agreement
regarding jobs creation), the Related Documents or any other
agreements with Lender;

(d)  The Company (i) is generally not paying its
Indebtedness as it becomes due, (ii) fails to pay any principal of
or interest on any obligation or obligations for borrowed money
beyond the period of grace, if any, provided for in the instrument
or agreement under which the same was created, or (iii) fails to
observe or perform any other term, condition or agreement
contained in any obligation or obligations for borrowed money or
in any instrument or agreement evidencing, securing or relating
thereto if the effect thereof is to cause or permit the holder or
holders of such obligation (or a trustee or an agent on behalf of
such holder or holders) to cause any such obligation to become due
prior to its stated maturity;

(e)  An event of default shall occur under any of the Related Documents;

(f)  Filing by the Company of a voluntary petition or
any answer seeking reorganization, arrangement or readjustment of
its or his debts or for any other relief under any applicable
bankruptcy act or law, or under any other insolvency act or law,
now or hereafter existing, or any action by the Company consenting
to, approving of or acquiescing in any such petition or
proceeding; the application by the Company for, or the appointment
by consent or acquiescence of, a receiver or trustee for the
Company or for all or a substantial part of its or his property;
the making by the Company of an assignment for the benefit of
creditors, the inability of the Company, or the admission by the
Company in writing of its inability to pay its debts as they
mature (the term "acquiescence" means the failure to file a
petition or motion in opposition to such petition or proceeding or
to vacate or discharge any order, judgment or decree providing for
such appointment within 30 days after the appointment of a
receiver or trustee);

(g)  Filing of an involuntary petition against the
Company in bankruptcy or seeking reorganization, arrangement or
readjustment of its debts or for any other relief under any
applicable bankruptcy act or law, or under any other insolvency
act or law, now or hereafter existing and such petition remains
undismissed or unanswered for a period of 30 days from such
filing; or the involuntary appointment of a receiver or trustee
for the Company for all or a substantial part of its or his
property and such appointment remains unvacated or unopposed for a
period of 10 days from such appointment; or the issuance of a writ
of attachment, execution or similar process against any
substantial part of the property of the Company and such writ
remains unbonded or undismissed for a period of 10 days from
notice to the Company of its issuance;

(h)  Final judgment for the payment of money in excess
of $25,000 shall be rendered against the Company and the same
shall remain undischarged for a period of 30 days, during which
execution shall not be effectively stayed;

(i)  Any substantial impairment of value, loss, damage
or destruction (not covered by insurance) of the Collateral occurs;

(j)  A trustee shall be appointed by an appropriate
United States District Court to administer any Plan of the
Company, or the Pension Benefit Guaranty Corporation shall
institute proceedings to terminate any Plan of the Company; or

(k)  Any financial statements submitted pursuant to
Section 5.1 hereof reflect a material deterioration in the
financial condition of the Company from the financial condition
reflected on the latest prior financial statements submitted to
Lender.

7.2  Optional Acceleration.  Upon the occurrence of any
Event of Default set forth in Subsection 7.1(a), (b), (c), (d),
(e), (h), (i), (j), or (k), any obligation of Lender to extend
credit to the Company pursuant hereto shall immediately terminate
and the holder of the Note, at its option, without notice to the
Company, may declare the principal of and interest accrued on the
Note to be forthwith due and payable, whereupon the same shall
become due and payable without any presentment, demand, protest,
notice of protest or notice of any kind (except notice required
pursuant to this Agreement or otherwise by law), all of which are
hereby waived; provided, however, that Lender shall give
telegraphic or written notice to the Company promptly after taking
any such action.

7.3  Automatic Acceleration.  Upon the occurrence of any
Event of Default set forth in Subsection 7.1(f) or (g) hereof, the
principal of and interest accrued on the Note shall be immediately
and automatically due and payable without notice or demand of any
kind, and the same shall be due and payable immediately without
any presentment, acceleration, demand, protest, notice of
acceleration, notice of protest or notice of any kind (except
notice required pursuant to this Agreement or otherwise by law),
all of which are hereby waived.

SECTION 8.  COVENANTS OF LENDER.

8.1  Mutual Release.  At the Closing, Lender shall execute
the Mutual Release in the form of Exhibit 8.1, which shall be
immediately effective.

8.2  Transfer of Assets.  At the Closing, Lender shall
assign and transfer to the Company any and all rights, interest
and title that it may have to the Collateral, including but not
limited to any of the assets described in the UCC-1 financing
statement attached hereto as Exhibit 8.2(i) and any and all
claims for theft, loss or damage to items located at 14600 South
Main Street, Gardena, California, provided that nothing in this
section shall be regarded as impairing any security interest that
Lender has in the Collateral.  Said assignment and transfer shall
be in the form of Exhibit 8.2(ii)

SECTION 9.  CLOSING

9.1  Fixing the Closing Date.  On or before March 1,
2000, the Company shall notify Lender that the Company has
satisfied or is in a position to satisfy all conditions to
Closing for the benefit of Lender.  If the Company has not given
such notice by such date then this Agreement shall expire and
thereafter Lender shall not have any obligation under this
Agreement.  If the Company gives such notice by such date, then
within two days after receipt of such notice Lender shall give
notice to the Company specifying a Pre-Closing Date (which shall
be not less than 1 nor more than 3 business days prior to the
scheduled Closing Date) and a Closing Date for the closing and
funding of the loans.

9.2  Failure to Close.  As a condition precedent to the
obligations of all parties under this Agreement, the Closing
shall have occurred on or before March 8, 2000.  If the Closing
has not occurred by not later than such date, then, provided
Lender is not in material default of this Agreement, Lender's
obligations under this Agreement shall terminate and thereafter
Lender shall not have any obligation under this Agreement.  If
the Closing has not occurred by such date, and provided he
Company is not in default under this Agreement, the Company may
terminate this Agreement by notice of such termination given to
Lender, and thereafter the only obligation of the Company under
this Agreement shall be to reimburse Lender for all reimbursable
costs incurred by Lender in connection with this Agreement to the
extent such costs have not been paid or reimbursed, previously,
by the Company.

9.3  Pre-Closing.

(a)  The Pre-Closing will commence at 9:00 a.m., Los Angeles time, on
the date established pursuant to Section 8.1 above, at the office
of Lender.  The Pre-Closing shall be used solely to allow Lender
to collect and receive all documents, instruments and other
matters to be delivered by or on behalf of the Company excluding
recordation and filing of instruments, and to determine whether
or not all conditions to Closing have been satisfied (except the
recordation and filing of instruments).

(b)  Excluding funding of the loans and recordation and
filing of documents and instruments as contemplated by this
Agreement, the parties shall review, complete and deliver such
other instruments and matters as may be necessary or reasonably
advisable to effectuate the closing of the loans under this
Agreement.

(c)  Lender shall hold until the Closing all instruments,
documents and other matters delivered at the Pre-Closing, and
shall distribute as appropriate copies thereof on or as soon as
reasonably possible after the Closing.

9.4  Documents to Be Delivered at Pre-Closing.

9.4.1  Documents to Be Delivered by the Company.
The Company shall deliver or cause to be delivered to Lender at
the Pre-Closing the following:

(a)  All the documents required or contemplated
hereunder from and executed by the appropriate parties, including
the Related Documents.

(b)  The following certificates and documents, in form
and substance satisfactory to Lender:

(i)  A certificate of the Chairman of the Board of
Directors, the President, any Vice President or other officer of
the Company responsible for financial and accounting matters, to
the effect set forth in Section 5.1 hereof and to the further
effect that (i) the Company has performed or complied with all of
its covenants and agreements required by this Agreement and the
Related Documents to have been performed or complied with, and
(ii) that all of the Company's representations and warranties in
Section 2 of this Agreement are true and correct in all material
respects;

(ii)  Properly certified resolutions, duly authorizing
the execution and delivery of this Agreement and the Related
Documents, and all documents Lender may reasonably request
relating to the existence and good standing of the Company and to
the authorization, execution and delivery of this Agreement, the
Related Documents and other matters relevant hereto;

(iii)  The articles of incorporation of the Company
as in effect on the Closing Date, certified by the Delaware
Secretary of State as of a date no more than thirty (30) days
prior to the Closing Date, a properly certified copy of the
organizational resolutions and bylaws of the Company as in effect
on the Closing Date, a Certificate of Good Standing issued by the
Secretary of State of Delaware with respect to the Company as of
a date no more than thirty (30) days prior to the Closing Date;

(iv)  A list and summary of all pending or threatened
litigation against the Company certified by one of the officers
specified in Subsection 9.4(b)(1) hereof;

(v)  A copy of the most recent federal income tax
return of the Company, or a statement certified by a proper
financial officer of the Company that there is no tax return;

(vi)  A copy of evidence of insurance coverage in form,
scope and substance satisfactory to Lender and otherwise meeting
the other requirements of Section 5.5 of this Agreement;

(vii)  A draft of an opinion of counsel for the Company, dated
as of the Closing Date, in form and substance satisfactory to
Lender, stating:

(A)  the Company has been duly organized and is validly existing
in good standing under the laws of Delaware and is duly qualified
to do business and is in good standing as a foreign corporation in
California;

(B)  the Company's authorized capital stock;

(C)  the Shares have been duly authorized and validly issued to
Lender and are fully paid and nonassessable;

(D)  the Company has the corporate power and authority to enter
into and perform the Agreement and to issue and deliver the Shares
and the Note to Lender, and that the execution, delivery and
performance of the Agreement, including the issuance and delivery
of the Shares and the Note, have been duly authorized by all
requisite corporate action, and the Agreement and the Note have
been duly executed and delivered by the Company;

(E)  the Agreement is a legal, valid and binding obligation of the
Company and is enforceable against the Company in accordance with
its terms;

(F)  the Company has valid and unencumbered title to the assets
transferred by Lender, Shootout Mountain and Guarantors pursuant
to Section 8.2 and paragraphs (c) and (e) of this Section 9.4;

(G)  the execution and delivery of the Agreement and Note, the
performance by the Company of their terms and the issuance of the
Shares do not conflict with or result in a violation of the
Company's Certificate of Incorporation or Bylaws or of any
agreement, instrument, order, writ, judgment or decree known to
counsel to which the Company is a party or is subject;

(H)  no approval, authorization or other action by, or filing with,
any governmental authority, is required in connection with the
execution and delivery by the Company of the Agreement and the
Note and the issuance of the Shares;  and

(I)  no registration of the Shares or the Note under the
Securities Act of 1933, and no qualification of an Indenture in
respect of the Note under the Trust Indenture Act of 1939, is
required in connection with the offering, issuance, sale and
delivery of the Shares and Note under the circumstances
contemplated by the Agreement.

(c)  Evidence that Shootout Mountain has assigned and
transferred, or at the Closing will transfer, to the Company its
right, title and interest to any and all of its assets,
including, without limitation, the assets described in Section
8.2.  Said assignment and transfer shall be in the form of Exhibit 9.4(c).

(d)  Payment, or adequate arrangement for payment on or
before the Closing Date, to Lender of the Company's pro rata
share of monthly expenses paid by Lender with respect to premises
of Shootout Mountain on the basis of a 30-day month as of the
date of Closing.

(e)  Evidence that Guarantors have transferred, or at
the Closing will transfer or have taken all steps necessary to
transfer, all rights in the mark "H BAR C RANCHWEAR" to the
Company.  Said transfer shall be in the form of Exhibit 9.4(e).

(f)  the Mutual Release, executed by Shootout Mountain and Guarantors.

9.4.2  Documents to Be Delivered by Lender.

(a)  Exhibit 8.1.

(b)  Exhibit 8.2(ii).

9.5  The Closing.  The Closing will commence at 9:00
a.m., Los Angeles time, on the date for closing (the "Closing
Date") established pursuant to Section 9.1 above, at the offices
of Lender, set forth in Section 10.7 below.  During the Closing
the following shall occur:

(a)  All of the instruments to be delivered to Lender
by or on behalf of the Company shall be delivered to Lender, and
all documents and instruments so delivered shall be deemed to
have been duly executed and delivered.

(b)  All of the instruments to be delivered by Lender
to the Company shall be so delivered by Lender, and all documents
and instruments so delivered so shall be deemed to have been duly
executed and delivered.

(c)  Delivery of a certificate or certificates representing the
Shares, registered in the name of Lender.  Lender acknowledges
that this certificate to be issued to Lender by the Company will
bear any legend required to comply with applicable state or
federal securities laws.

(d)  The Company shall pay to Lender in immediately available funds
the sum of Twenty-Five Thousand Dollars ($25,000.00).

(e)  Lender may take such action as Lender deems
appropriate to cause all instruments to be recorded or filed in
Los Angeles County to be so recorded and filed, and to cause all
instruments to be filed in the office of the Secretary of State
of California to be so filed.

(f)  The opinion of counsel described in subsection 9.4(b)(vii) shall be
delivered to Lender.

(g)  Evidence that all of the assets of Shootout Mountain have been
transferred to the Company.

(h)  Evidence that Guarantors have transferred, or have
taken all steps necessary to transfer, to the Company all of
their rights, title and interest in the mark "H BAR C RANCHWEAR".

9.6  Post-Closing Matters.  If the Closing occurs, then
following the Closing the parties shall cooperate reasonably and
in good faith to complete any matter not completed at Closing; to
provide, execute and deliver any documents and instruments
required to be delivered on or before Closing but which were not
so delivered; to execute and deliver such additional documents as
may be reasonably advisable or necessary to complete the
transactions contemplated by this Agreement as to have been
completed at Closing; and, Lender shall provide to the Company at
least one complete set of true and conformed photocopies of all
documents and instruments delivered at Closing, with recording
and filing data shown on documents which are recorded or filed.

SECTION 10.  MISCELLANEOUS.

10.1  No Waiver; Cumulative Remedies.  No failure to exercise
and no delay in exercising, on the part of Lender, any right,
power or privilege hereunder shall operate as a waiver thereof;
nor shall any single or partial exercise of any right, power or
privilege hereunder preclude any other or further exercise thereof
or the exercise of any other right, power or privilege.  The
rights and remedies herein provided are cumulative and not
exclusive of any rights or remedies provided by law or in any
other agreement.

10.2  Survival of Agreements.  All agreements, covenants,
representations and warranties made herein shall survive the
delivery of the Related Documents and the making and renewal
thereof.

10.3  Successors.  This Agreement shall be binding upon the
Company and its successors, assigns, heirs and legal
representatives, and shall inure to the benefit of Lender and its
successors and assigns.  The Company shall have no right to assign
any rights or obligations under this Agreement, any Related
Document, or any interest therein, without the prior written
consent of Lender.

10.4  Counterparts.  This Agreement may be executed in any
number of counterparts and all of such counterparts taken together
shall be deemed to constitute one and the same instrument.

10.5  Severability.  In case any one or more of the
provisions contained in this Agreement or in any of the or any
other documents executed in connection therewith or herewith
should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions
contained herein and therein shall not be affected in any way
thereby.

10.6  Expenses; Documentary Taxes.  The Company will pay (i)
all out-of-pocket expenses of Lender, including reasonable fees,
expenses and disbursements of Lender's counsel, accountants and
other professionals (including outside counsel fees, and all
allocated costs of Lender's in-house counsel) in connection with
the enforcement, operation and administration of this Agreement or
any waiver or amendment of any provision hereof, including any
inspection pursuant to Section 5.9 hereof; and (ii) if an Event of
Default occurs, all court costs and costs of collection,
including, without limitation, reasonable fees, expenses and
disbursements of counsel, accountants and other professionals
employed by Lender in connection with any and all collection
efforts.  The Company agrees to indemnify Lender from and hold it
harmless against any documentary taxes, assessments or charges
made by any governmental authority by reason of the execution and
delivery by the Company of this Agreement, the Related Documents
and any documents executed in connection therewith.

10.7  Notices.  All notices, requests and demands shall be in
writing, shall be personally delivered or deposited into the
United States Mail, postage prepaid, or sent by telefacsimile with
receipt confirmed by telephone, and shall be addressed to the
respective parties hereto as follows:

If to the Company, to

H BAR C, INC.
14600 South Main Street
Gardena, CA  90248
Attn:  Mr. Richard Stahl
Fax no.:  (516) 338-7772

With a copy for informational
Purposes to:

Mr. Richard Stahl
118 Murray Avenue
Port Washington, NY  11050
Fax no.:  (516) 338-7772

With a copy for informational
Purposes to:

John G. Clancy, Esq.
777 Main Avenue, Suite 209
Durango, CO  81301
Fax no.:  (970) 385-4991

or to such other address as the Company shall have furnished
to the Lender in writing; and

If to Lender, to

Los Angeles Community Development Bank
(Not a Commercial Bank)
5312B South Vermont Avenue
Los Angeles, CA  90037
Attn:  Rena M. Haviland, Esq.
Fax no.:  (323) 759-7750

With a copy for informational
Purposes to:

Barbosa Garcia & Sistos LLP
801 South Grand Avenue, Suite 300
Los Angeles, CA  90017
Attn:  Michael L. Kadish, Esq.
Fax no.:  (213) 612-8085

or at such other address as the Lender shall have furnished
to the Company in writing.

10.8  Controlling Document.  In the event of actual conflict
in the terms and provisions of this Agreement and the Related
Documents, the terms and provisions of this Agreement will
control.

10.9  Indemnification.  The Company shall indemnify and hold
Lender harmless, and shall defend Lender through counsel selected
by Lender at the Company's sole cost and expense, from and against
each and every demand, claim, loss, liability, judgment, damage,
cost and expense (including, without limitation, interest,
penalties, costs of preparation and investigation, and fees,
disbursements and expenses of attorneys, accountants and other
professional advisors) imposed on or incurred by Lender, relating
to, resulting from or arising out of any inaccuracy in any
representation or warranty made by the Company or any breach or
nonfulfillment of any covenant, agreement or other obligation of
the Company under this Agreement, the Related Documents, or any
documents related thereto.

10.10  Amendment.  This Agreement may not be amended except in
writing signed by the Company and Lender.

10.11  Descriptive Headings.  Descriptive headings of the
several sections of this Agreement are inserted for convenience
only and do not constitute a part of this Agreement.

10.12  Governing Law.  This Agreement and the Related
Documents shall be governed by, construed and interpreted in
accordance with the laws of the State of California, except to the
extent that the federal laws of the United States of America may
apply.

10.13  Submission to Jurisdiction.  The Company consents to
consent to the jurisdiction of any state or federal court located
within the County of Los Angeles, State of California and hereby
waives personal service of any and all process upon it or him and
consents that all such service of process may be made by certified
mail directed to it at the address stated in Section 10.7 hereof,
and service so made to the Company shall be deemed to be completed
five days after the same shall have been posted to the
above-described address by the agent as described below.

10.14  Time of the Essence.  Time is of the essence in
the payment and performance by the Company of each and all of its
covenants, obligations and duties under this Agreement, and in
payment of amounts due pursuant to the Note and the Put Option.

10.15  Represented by Counsel.  The Company has been
represented by independent counsel, and it and its counsel have
fully investigated (or have had the opportunity to fully
investigate) all material facts relating to the transactions
contemplated by this Agreement.

10.16  Attorneys' Fees.  Should any party hereto
institute any action or proceeding in court to enforce any
provision hereof or for damages by reason of an alleged breach of
any provision of this Agreement or of any of the Related
Documents, or if the defense of any action between the parties is
based upon this Agreement or any of the Related Documents, the
prevailing party shall be entitled to recover from the losing
party or parties such amount as the court may adjudge to be
reasonable attorneys' fees for services rendered to the
prevailing party in such action or proceeding.  The term
"prevailing party" as used in this paragraph shall include,
without limitation, any party who is made a defendant in
litigation in which either or both damages and other relief may
be sought against such party and a final judgment or dismissal or
decree is entered in such litigation in favor of such party
defendant.  Attorneys' fees recoverable by Lender shall include
the reasonable value of the services of any employee attorney or
so-called "in-house" attorney of Lender.

10.17  Exhibits.  All exhibits attached hereto and
referred to herein are hereby incorporated herein as though set
forth herein in their entirety.

10.18  Waiver of Right to Jury Trial.  THE COMPANY AND LENDER
EACH HEREBY WAIVES ITS RIGHT TO TRIAL BY JURY IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THE INDEBTEDNESS, THIS
AGREEMENT OR ANY RELATED DOCUMENT.

THE COMPANY ACKNOWLEDGES HAVING READ ALL OF THE PROVISIONS OF THIS
AGREEMENT AND, HAVING THE BENEFIT OF THE ADVICE OF COUNSEL, THE
COMPANY AGREES TO ALL OF ITS TERMS AND CONDITIONS.

IN WITNESS WHEREOF, the parties hereunto have caused this
Agreement to be duly executed in Los Angeles, California, as of
the Closing Date.

LOS ANGELES COMMUNITY
DEVELOPMENT BANK (Not a
Commercial Bank)


By: /s/  Estevan Valenzuela
Name: Estevan Valenzuela
Title: Chief Operating Officer

- LENDER -

H BAR C, INC.


By: /s/  Richard Stahl
Name: Richard Stahl
Title: President

- THE COMPANY -

AGREED AND ACCEPTED:

SHOOTOUT MOUNTAIN OUTFITTERS AND DRY GOODS, INC.


By: /s/  Mary-Elizabeth D. Wallenius
Name:  Mary-Elizabeth D. Wallenius
Title:    President

By: /s/  Roger Cook
Name:  Roger Cook
Title:  Secretary/Treasurer



MARY-ELIZABETH D. WALLENIUS
/s/  Mary-Elizabeth D. Wallenius



ROGER COOK
/s/  Roger Cook

EXHIBITS

1.2(12)  City of L.A. Supplemental Empowerment Zone
1.2(24)  Note
1.2(32)  Reimbursement Note
1.2(35)  Security Agreement
4.1      Notice of Exercise of Put Option
4.2      Notice of Exercise of Call Option
8.1      Mutual Release
8.2(i)   UCC-1 Financing Statement
8.2(ii)  Assignment and Transfer of Lender
9.4(c)   Assignment and Transfer of Shootout Mountain
9.4(e)   Assignment and Transfer by Guarantors