Document:

Exhibit 10.3

 

 

 

The Bank Business Banks On

 

COMMERCIAL GUARANTY

 

	Principal

$10,000,000.00	Loan Date

07-12-2019	Maturity

07-05-2021	Loan No

155354101	Call / Coll	Account

600714	Officer

7001	Initials

CJ
	
        References in the boxes above are for Lender’s
        use only and do not limit the applicability of this document to any particular loan or item.

        Any item above containing “***”
        has been omitted due to text length limitations.

 

	Borrower:	 Bisco
Industries, Inc.
 1500 North Lakeview Loop 
 Anaheim, CA 92807

                                              
	 	Lender:	Citizens Business Bank

Plaza Business Financial Center

77 Plaza Square

Orange, CA 92866
	Guarantor:	EACO Corporation

1500 North Lakeview Loop

Anaheim, CA 92807	 	 

 

	 	 	 	 

 

CONTINUING GUARANTEE
OF PAYMENT AND PERFORMANCE. For good and valuable consideration, Guarantor absolutely and unconditionally guarantees full and
punctual payment and satisfaction of the Indebtedness of Borrower to Lender, and the performance and discharge of all Borrower's
obligations under the Note and the Related Documents. This is a guaranty of payment and performance and not of collection, so Lender
can enforce this Guaranty against Guarantor even when Lender has not exhausted Lender's remedies against anyone else obligated
to pay the Indebtedness or against any collateral securing the Indebtedness, this Guaranty or any other guaranty of the Indebtedness.
Guarantor will make any payments to Lender or its order, on demand, in legal tender of the United States of America, in same-day
funds, without set-off or deduction or counterclaim, and will otherwise perform Borrower's obligations under the Note and Related
Documents. Under this Guaranty, Guarantor's liability is unlimited and Guarantor's obligations are continuing.

 

INDEBTEDNESS. The
word "Indebtedness" as used in this Guaranty means all of the principal amount outstanding from time to time and at any
one or more times, accrued unpaid interest thereon and all collection costs and legal expenses related thereto permitted by law,
attorneys' fees, arising from any and all debts, liabilities and obligations of every nature or form, now existing or hereafter
arising or acquired, that Borrower individually or collectively or interchangeably with others, owes or will owe Lender. "Indebtedness"
includes, without limitation, loans, advances, debts, overdraft indebtedness, credit card indebtedness, lease obligations, liabilities
and obligations under any interest rate protection agreements or foreign currency exchange agreements or commodity price protection
agreements, other obligations, and liabilities of Borrower, and any present or future judgments against Borrower, future advances,
loans or transactions that renew, extend, modify, refinance, consolidate or substitute these debts, liabilities and obligations
whether: voluntarily or involuntarily incurred; due or to become due by their terms or acceleration; absolute or contingent; liquidated
or unliquidated; determined or undetermined; direct or indirect; primary or secondary in nature or arising from a guaranty or surety;
secured or unsecured; joint or several or joint and several; evidenced by a negotiable or non-negotiable instrument or writing;
originated by Lender or another or others; barred or unenforceable against Borrower for any reason whatsoever; for any transactions
that may be voidable for any reason (such as infancy, insanity, ultra vires or otherwise); and originated then reduced or extinguished
and then afterwards increased or reinstated.

 

If Lender presently holds
one or more guaranties, or hereafter receives additional guaranties from Guarantor, Lender's rights under all guaranties shall
be cumulative. This Guaranty shall not (unless specifically provided below to the contrary) affect or invalidate any such other
guaranties. Guarantor's liability will be Guarantor's aggregate liability under the terms of this Guaranty and any such other unterminated
guaranties.

 

CONTINUING GUARANTY.
THIS IS A "CONTINUING GUARANTY" UNDER WHICH GUARANTOR AGREES TO GUARANTEE THE FULL AND PUNCTUAL PAYMENT, PERFORMANCE
AND SATISFACTION OF THE INDEBTEDNESS OF BORROWER TO LENDER, NOW EXISTING OR HEREAFTER ARISING OR ACQUIRED, ON AN OPEN AND CONTINUING
BASIS. ACCORDINGLY, ANY PAYMENTS MADE ON THE INDEBTEDNESS WILL NOT DISCHARGE OR DIMINISH GUARANTOR'S OBLIGATIONS AND LIABILITY
UNDER THIS GUARANTY FOR ANY REMAINING AND SUCCEEDING INDEBTEDNESS EVEN WHEN ALL OR PART OF THE OUTSTANDING INDEBTEDNESS MAY BE
A ZERO BALANCE FROM TIME TO TIME.

 

DURATION OF GUARANTY.
This Guaranty will take effect when received by Lender without the necessity of any acceptance by Lender, or any notice to
Guarantor or to Borrower, and will continue in full force until all the Indebtedness incurred or contracted before receipt by Lender
of any notice of revocation shall have been fully and finally paid and satisfied and all of Guarantor's other obligations under
this Guaranty shall have been performed in full. If Guarantor elects to revoke this Guaranty, Guarantor may only do so in writing.
Guarantor's written notice of revocation must be mailed to Lender, by certified mail, at Lender's address listed above or such
other place as Lender may designate in writing. Written revocation of this Guaranty will apply only to new Indebtedness created
after actual receipt by Lender of Guarantor's written revocation. For this purpose and without limitation, the term "new Indebtedness"
does not include the Indebtedness which at the time of notice of revocation is contingent, unliquidated, undetermined or not due
and which later becomes absolute, liquidated, determined or due. For this purpose and without limitation, "new Indebtedness"
does not include all or part of the Indebtedness that is: incurred by Borrower prior to revocation; incurred under a commitment
that became binding before revocation; any renewals, extensions, substitutions, and modifications of the Indebtedness. This Guaranty
shall bind Guarantor's estate as to the Indebtedness created both before and after Guarantor's death or incapacity, regardless
of Lender's actual notice of Guarantor's death. Subject to the foregoing, Guarantor's executor or administrator or other legal
representative may terminate this Guaranty in the same manner in which Guarantor might have terminated it and with the same effect.
Release of any other guarantor or termination of any other guaranty of the Indebtedness shall not affect the liability of Guarantor
under this Guaranty. A revocation Lender receives from any one or more Guarantors shall not affect the liability of any remaining
Guarantors under this Guaranty. Guarantor's obligations under this Guaranty shall be in addition to any of Guarantor's obligations,
or any of them, under any other guaranties of the Indebtedness or any other person heretofore or hereafter given to Lender unless
such other guaranties are modified or revoked in writing; and this Guarantor shall not, unless provided in this Guaranty, affect,
invalidate, or supersede any such other guaranty. It is anticipated that fluctuations may occur in the aggregate amount of the
Indebtedness covered by this Guaranty, and Guarantor specifically acknowledges and agrees that reductions in the amount of the
Indebtedness, even to zero dollars ($0.00), shall not constitute a termination of this Guaranty. This Guaranty is binding upon
Guarantor and Guarantor's heirs, successors and assigns so long as any of the Indebtedness remains unpaid and even though the Indebtedness
may from time to time be zero dollars ($0.00).

 

     

    
	 	COMMERCIAL GUARANTY	 
	Loan No: 155354101	(Continued)
	Page 2
	 	 	 

 

    

 

GUARANTOR'S AUTHORIZATION
TO LENDER. Guarantor authorizes Lender, either before or after any revocation hereof, without notice or demand and without
lessening Guarantor's liability under this Guaranty, from time to time: (A) prior to revocation as set forth above, to make
one or more additional secured or unsecured loans to Borrower, to lease equipment or other goods to Borrower, or otherwise to extend
additional credit to Borrower; (B) to alter, compromise, renew, extend, accelerate, or otherwise change one or more times the time
for payment or other terms of the Indebtedness or any part of the Indebtedness, including increases and decreases of the rate of
interest on the Indebtedness; extensions may be repeated and may be for longer than the original loan term; (C) to take and hold
security for the payment of this Guaranty or the Indebtedness, and exchange, enforce, waive, subordinate, fail or decide not to
perfect, and release any such security, with or without the substitution of new collateral; (D) to release, substitute, agree not
to sue, or deal with any one or more of Borrower's sureties, endorsers, or other guarantors on any terms or in any manner Lender
may choose; (E) to determine how, when and what application of payments and credits shall be made on the Indebtedness; (F) to apply
such security and direct the order or manner of sale thereof, including without limitation, any nonjudicial sale permitted by the
terms of the controlling security agreement or deed of trust, as Lender in its discretion may determine; (G) to sell, transfer,
assign or grant participations in all or any part of the Indebtedness; and (H) to assign or transfer this Guaranty in whole or
in part.

 

GUARANTOR'S REPRESENTATIONS
AND WARRANTIES. Guarantor represents and warrants to Lender that (A) no representations or agreements of any kind have been
made to Guarantor which would limit or qualify in any way the terms of this Guaranty; (B) this Guaranty is executed at Borrower's
request and not at the request of Lender; (C) Guarantor has full power, right and authority to enter into this Guaranty; (D) the
provisions of this Guaranty do not conflict with or result in a default under any agreement or other instrument binding upon Guarantor
and do not result in a violation of any law, regulation, court decree or order applicable to Guarantor; (E) Guarantor has not and
will not, without the prior written consent of Lender, sell, lease, assign, encumber, hypothecate, transfer, or otherwise dispose
of all or substantially all of Guarantor's assets, or any interest therein; (F) upon Lender's request, Guarantor will provide to
Lender financial and credit information in form acceptable to Lender, and all such financial information which currently has been,
and all future financial information which will be provided to Lender is and will be true and correct in all material respects
and fairly present Guarantor's financial condition as of the dates the financial information is provided; (G) no material adverse
change has occurred in Guarantor's financial condition since the date of the most recent financial statements provided to Lender
and no event has occurred which may materially adversely affect Guarantor's financial condition; (H) no litigation, claim, investigation,
administrative proceeding or similar action (including those for unpaid taxes) against Guarantor is pending or threatened; (I)
Lender has made no representation to Guarantor as to the creditworthiness of Borrower; and (J) Guarantor has established adequate
means of obtaining from Borrower on a continuing basis information regarding Borrower's financial condition. Guarantor agrees to
keep adequately informed from such means of any facts, events, or circumstances which might in any way affect Guarantor's risks
under this Guaranty, and Guarantor further agrees that, absent a request for information, Lender shall have no obligation to disclose
to Guarantor any information or documents acquired by Lender in the course of its relationship with Borrower.

 

GUARANTOR'S FINANCIAL
STATEMENTS. Guarantor agrees to furnish Lender with the following:

 

Additional Requirements.

 

Annual Statements. As
soon as available, but in no event later than 120 days after the end of each fiscal year on a consolidating basis, Guarantor's
balance sheet and income statement for the year ended, audited by a certified public accountant satisfactory to Lender.

 

Interim Statements. As
soon as available, but in no event later than 45 days after the end of each fiscal quarter, Guarantor's balance sheet and profit
and loss statement for the period ended, prepared by Guarantor.

 

Tax Returns. As soon
as available, but in no event later 30 days after the applicable filing date for the tax reporting period ended, Guarantor's Federal
and other governmental tax returns, prepared by a tax professional satisfactory to Lender. To include all K-1's, schedules, and
statements.

 

All financial reports required
to be provided under this Guaranty shall be prepared in accordance with GAAP, applied on a consistent basis, and certified by Guarantor
as being true and correct.

 

GUARANTOR'S WAIVERS.
Except as prohibited by applicable law, Guarantor waives any right to require Lender to (A) make any presentment, protest,
demand, or notice of any kind, including notice of change of any terms of repayment of the Indebtedness, default by Borrower or
any other guarantor or surety, any action or nonaction taken by Borrower, Lender, or any other guarantor or surety of Borrower,
or the creation of new or additional Indebtedness; (B) proceed against any person, including Borrower, before proceeding against
Guarantor; (C) proceed against any collateral for the Indebtedness, including Borrower's collateral, before proceeding against
Guarantor; (D) apply any payments or proceeds received against the Indebtedness in any order; (E) give notice of the terms, time,
and place of any sale of the collateral pursuant to the Uniform Commercial Code or any other law governing such sale; (F) disclose
any information about the Indebtedness, the Borrower, the collateral, or any other guarantor or surety, or about any action or
nonaction of Lender; or (G) pursue any remedy or course of action in Lender's power whatsoever.

 

     

    
	 	COMMERCIAL GUARANTY	 
	Loan No: 155354101	(Continued)
	Page 3
	 	 	 

 

    

 

Guarantor also waives any
and all rights or defenses arising by reason of (H) any disability or other defense of Borrower, any other guarantor or surety
or any other person; (I) the cessation from any cause whatsoever, other than payment in full, of the Indebtedness; (J) the application
of proceeds of the Indebtedness by Borrower for purposes other than the purposes understood and intended by Guarantor and Lender;
(K) any act of omission or commission by Lender which directly or indirectly results in or contributes to the discharge of Borrower
or any other guarantor or surety, or the Indebtedness, or the loss or release of any collateral by operation of law or otherwise;
(L) any statute of limitations in any action under this Guaranty or on the Indebtedness; or (M) any modification or change in terms
of the Indebtedness, whatsoever, including without limitation, the renewal, extension, acceleration, or other change in the time
payment of the Indebtedness is due and any change in the interest rate, and including any such modification or change in terms
after revocation of this Guaranty on the Indebtedness incurred prior to such revocation.

 

Guarantor waives all rights
of subrogation, reimbursement, indemnification, and contribution and any other rights and defenses that are or may become available
to Guarantor by reason of California Civil Code Sections 2787 to 2855, inclusive.

 

Guarantor waives all rights
and any defenses arising out of an election of remedies by Lender even though that the election of remedies, such as a non-judicial
foreclosure with respect to security for a guaranteed obligation, has destroyed Guarantor's rights of subrogation and reimbursement
against Borrower by operation of Section 580d of the California Code of Civil Procedure or otherwise.

 

Guarantor waives all rights
and defenses that Guarantor may have because Borrower's obligation is secured by real property. This means among other things:
(N) Lender may collect from Guarantor without first foreclosing on any real or personal property collateral pledged by Borrower.
(0) If Lender forecloses on any real property collateral pledged by Borrower: (1) the amount of Borrower's obligation may be reduced
only by the price for which the collateral is sold at the foreclosure sale, even if the collateral is worth more than the sale
price. (2) Lender may collect from Guarantor even if Lender, by foreclosing on the real property collateral, has destroyed any
right Guarantor may have to collect from Borrower. This is an unconditional and irrevocable waiver of any rights and defenses Guarantor
may have because Borrower's obligation is secured by real property. These rights and defenses include, but are not limited to,
any rights and defenses based upon Section 580a, 580b, 580d, or 726 of the Code of Civil Procedure.

 

Guarantor understands and
agrees that the foregoing waivers are unconditional and irrevocable waivers of substantive rights and defenses to which Guarantor
might otherwise be entitled under state and federal law. The rights and defenses waived include, without limitation, those provided
by California laws of suretyship and guaranty, anti-deficiency laws, and the Uniform Commercial Code. Guarantor acknowledges that
Guarantor has provided these waivers of rights and defenses with the intention that they be fully relied upon by Lender. Guarantor
further understands and agrees that this Guaranty is a separate and independent contract between Guarantor and Lender, given for
full and ample consideration, and is enforceable on its own terms. Until all of the Indebtedness is paid in full, Guarantor waives
any right to enforce any remedy Guarantor may have against the Borrower or any other guarantor, surety, or other person, and further,
Guarantor waives any right to participate in any collateral for the Indebtedness now or hereafter held by Lender.

 

Guarantor's Understanding
With Respect To Waivers. Guarantor warrants and agrees that each of the waivers set forth above is made with Guarantor's full
knowledge of its significance and consequences and that, under the circumstances, the waivers are reasonable and not contrary to
public policy or law. If any such waiver is determined to be contrary to any applicable law or public policy, such waiver shall
be effective only to the extent permitted by law or public policy.

 

Right of Setoff. To
the extent permitted by applicable law, Lender reserves a right of setoff in all Guarantor's accounts with Lender (whether checking,
savings, or some other account). This includes all accounts Guarantor holds jointly with someone else and all accounts Guarantor
may open in the future. However, this does not include any IRA or Keogh accounts, or any trust accounts for which setoff would
be prohibited by law. Guarantor authorizes Lender, to the extent permitted by applicable law, to hold these funds if there is a
default, and Lender may apply the funds in these accounts to pay what Guarantor owes under the terms of this Guaranty.

 

Subordination of Borrower's
Debts to Guarantor. Guarantor agrees that the Indebtedness, whether now existing or hereafter created, shall be superior to
any claim that Guarantor may now have or hereafter acquire against Borrower, whether or not Borrower becomes insolvent. Guarantor
hereby expressly subordinates any claim Guarantor may have against Borrower, upon any account whatsoever, to any claim that Lender
may now or hereafter have against Borrower. In the event of insolvency and consequent liquidation of the assets of Borrower, through
bankruptcy, by an assignment for the benefit of creditors, by voluntary liquidation, or otherwise, the assets of Borrower applicable
to the payment of the claims of both Lender and Guarantor shall be paid to Lender and shall be first applied by Lender to the Indebtedness.
Guarantor does hereby assign to Lender all claims which it may have or acquire against Borrower or against any assignee or trustee
in bankruptcy of Borrower; provided however, that such assignment shall be effective only for the purpose of assuring to Lender
full payment in legal tender of the Indebtedness. If Lender so requests, any notes or credit agreements now or hereafter evidencing
any debts or obligations of Borrower to Guarantor shall be marked with a legend that the same are subject to this Guaranty and
shall be delivered to Lender. Guarantor agrees, and Lender is hereby authorized, in the name of Guarantor, from time to time to
file financing statements and continuation statements and to execute documents and to take such other actions as Lender deems necessary
or appropriate to perfect, preserve and enforce its rights under this Guaranty.

 

Miscellaneous Provisions.
The following miscellaneous provisions are a part of this Guaranty:

 

AMENDMENTS. This
Guaranty, together with any Related Documents, constitutes the entire understanding and agreement of the parties as to the matters
set forth in this Guaranty. No alteration of or amendment to this Guaranty shall be effective unless given in writing and signed
by the party or parties sought to be charged or bound by the alteration or amendment.

 

     

    
	 	COMMERCIAL GUARANTY	 
	Loan No: 155354101	(Continued)
	Page 4
	 	 	 

 

    

 

ARBITRATION. Guarantor
and Lender agree that all disputes, claims and controversies between them whether individual, joint, or class in nature, arising
from this Guaranty or otherwise, including without limitation contract and tort disputes, shall be arbitrated pursuant to the
financial services rules of J.A.M.S. or its successor in effect at the time the claim is filed, upon request of either party.
No act to take or dispose of any Collateral shall constitute a waiver of this arbitration agreement or be prohibited by this arbitration
agreement. This includes, without limitation, obtaining injunctive relief or a temporary restraining order; invoking a power of
sale under any deed of trust or mortgage; obtaining a writ of attachment or imposition of a receiver; or exercising any rights
relating to personal property, including taking or disposing of such property with or without judicial process pursuant Article
9 of the Uniform Commercial Code. Any disputes, claims, or controversies concerning the lawfulness or reasonableness of any act,
or exercise of any right, concerning any Collateral, including any claim to rescind, reform, or otherwise modify any agreement
relating to the Collateral, shall also be arbitrated, provided however that no arbitrator shall have the right or the power to
enjoin or restrain any act of any party. Borrower and Guarantor and Lender agree that in the event of an action for judicial foreclosure
pursuant to California Code of Civil Procedure Section 726, or any similar provision in any other state, the commencement of such
an action will not constitute a waiver of the right to arbitrate and the court shall refer to arbitration as much of such action,
including counterclaims, as lawfully may be referred to arbitration. Judgment upon any award rendered by any arbitrator may be
entered in any court having jurisdiction. Nothing in this Guaranty shall preclude any party from seeking equitable relief from
a court of competent jurisdiction. The statute of limitations, estoppel, waiver, laches, and similar doctrines which would otherwise
be applicable in an action brought by a party shall be applicable in any arbitration proceeding, and the commencement of an arbitration
proceeding shall be deemed the commencement of an action for these purposes. The Federal Arbitration Act shall apply to the construction,
interpretation, and enforcement of this arbitration provision.

 

ATTORNEYS' FEES; EXPENSES.
Guarantor agrees to pay upon demand all of Lender's costs and expenses, including Lender's attorneys' fees and Lender's legal
expenses, incurred in connection with the enforcement of this Guaranty. Lender may hire or pay someone else to help enforce this
Guaranty, and Guarantor shall pay the costs and expenses of such enforcement. Costs and expenses include Lender's attorneys' fees
and legal expenses whether or not there is a lawsuit, including attorneys' fees and legal expenses for bankruptcy proceedings (including
efforts to modify or vacate any automatic stay or injunction), appeals, and any anticipated post-judgment collection services.
Guarantor also shall pay all court costs and such additional fees as may be directed by the court.

 

CAPTION HEADINGS. Caption
headings in this Guaranty are for convenience purposes only and are not to be used to interpret or define the provisions of this
Guaranty.

 

GOVERNING LAW. This
Guaranty will be governed by federal law applicable to Lender and, to the extent not preempted by federal law, the laws of the
State of California without regard to its conflicts of law provisions.

 

CHOICE OF VENUE. If
there is a lawsuit, Guarantor agrees upon Lender's request to submit to the jurisdiction of the courts of Orange County, State
of California.

 

INTEGRATION. Guarantor
further agrees that Guarantor has read and fully understands the terms of this Guaranty; Guarantor has had the opportunity to be
advised by Guarantor's attorney with respect to this Guaranty; the Guaranty fully reflects Guarantor's intentions and parol evidence
is not required to interpret the terms of this Guaranty. Guarantor hereby indemnifies and holds Lender harmless from all losses,
claims, damages, and costs (including Lender's attorneys' fees) suffered or incurred by Lender as a result of any breach by Guarantor
of the warranties, representations and agreements of this paragraph.

 

INTERPRETATION. In
all cases where there is more than one Borrower or Guarantor, then all words used in this Guaranty in the singular shall be deemed
to have been used in the plural where the context and construction so require; and where there is more than one Borrower named
in this Guaranty or when this Guaranty is executed by more than one Guarantor, the words "Borrower" and "Guarantor"
respectively shall mean all and any one or more of them. The words "Guarantor," "Borrower," and "Lender"
include the heirs, successors, assigns, and transferees of each of them. If a court finds that any provision of this Guaranty is
not valid or should not be enforced, that fact by itself will not mean that the rest of this Guaranty will not be valid or enforced.
Therefore, a court will enforce the rest of the provisions of this Guaranty even if a provision of this Guaranty may be found to
be invalid or unenforceable. If any one or more of Borrower or Guarantor are corporations, partnerships, limited liability companies,
or similar entities, it is not necessary for Lender to inquire into the powers of Borrower or Guarantor or of the officers, directors,
partners, managers, or other agents acting or purporting to act on their behalf, and any indebtedness made or created in reliance
upon the professed exercise of such powers shall be guaranteed under this Guaranty.

 

NOTICES. Any notice
required to be given under this Guaranty shall be given in writing, and, except for revocation notices by Guarantor, shall be effective
when actually delivered, when actually received by telefacsimile (unless otherwise required by law), when deposited with a nationally
recognized overnight courier, or, if mailed, when deposited in the United States mail, as first class, certified or registered
mail postage prepaid, directed to the addresses shown near the beginning of this Guaranty. All revocation notices by Guarantor
shall be in writing and shall be effective upon delivery to Lender as provided in the section of this Guaranty entitled "DURATION
OF GUARANTY." Any party may change its address for notices under this Guaranty by giving formal written notice to the other
parties, specifying that the purpose of the notice is to change the party's address. For notice purposes, Guarantor agrees to keep
Lender informed at all times of Guarantor's current address. Unless otherwise provided or required by law, if there is more than
one Guarantor, any notice given by Lender to any Guarantor is deemed to be notice given to all Guarantors.

 

NO WAIVER BY LENDER.
Lender shall not be deemed to have waived any rights under this Guaranty unless such waiver is given in writing and signed
by Lender. No delay or omission on the part of Lender in exercising any right shall operate as a waiver of such right or any other
right. A waiver by Lender of a provision of this Guaranty shall not prejudice or constitute a waiver of Lender's right otherwise
to demand strict compliance with that provision or any other provision of this Guaranty. No prior waiver by Lender, nor any course
of dealing between Lender and Guarantor, shall constitute a waiver of any of Lender's rights or of any of Guarantor's obligations
as to any future transactions. Whenever the consent of Lender is required under this Guaranty, the granting of such consent by
Lender in any instance shall not constitute continuing consent to subsequent instances where such consent is required and in all
cases such consent may be granted or withheld in the sole discretion of Lender.

 

     

    
	 	COMMERCIAL GUARANTY	 
	Loan No: 155354101	(Continued)
	Page 5
	 	 	 

 

    

 

SUCCESSORS AND ASSIGNS.
Subject to any limitations stated in this Guaranty on transfer of Guarantor's interest, this Guaranty shall be binding upon
and inure to the benefit of the parties, their successors and assigns.

 

WAIVE JURY. To the
extent permitted by applicable law, Lender and Guarantor hereby waive the right to any jury trial in any action, proceeding, or
counterclaim brought by either Lender or Guarantor against the other.

 

COUNTERPARTS. This
document may be executed in any number of counterparts and by different parties on separate counterparts, each of which when executed
and delivered, shall be deemed to be an original, and all of which, when taken together, shall constitute but one and the same
agreement.

 

Definitions. The
following capitalized words and terms shall have the following meanings when used in this Guaranty. Unless specifically stated
to the contrary, all references to dollar amounts shall mean amounts in lawful money of the United States of America. Words and
terms used in the singular shall include the plural, and the plural shall include the singular, as the context may require. Words
and terms not otherwise defined in this Guaranty shall have the meanings attributed to such terms in the Uniform Commercial Code:

 

BORROWER. The word
"Borrower" means Bisco Industries, Inc. and includes all co-signers and co-makers signing the Note and all their successors
and assigns.

 

GAAP. The word "GAAP"
means generally accepted accounting principles.

 

GUARANTOR. The word
"Guarantor" means everyone signing this Guaranty, including without limitation EACO Corporation, and in each case, any
signer's successors and assigns.

 

GUARANTY. The word
"Guaranty" means this guaranty from Guarantor to Lender.

 

INDEBTEDNESS. The
word "Indebtedness" means Borrower's indebtedness to Lender as more particularly described in this Guaranty.

 

LENDER. The word
"Lender" means Citizens Business Bank, its successors and assigns.

 

NOTE. The word "Note"
means and includes without limitation all of Borrower's promissory notes and/or credit agreements evidencing Borrower's loan obligations
in favor of Lender, together with all renewals of, extensions of, modifications of, refinancings of, consolidations of and substitutions
for promissory notes or credit agreements.

 

RELATED DOCUMENTS. The
words "Related Documents" mean all promissory notes, credit agreements, loan agreements, environmental agreements, guaranties,
security agreements, mortgages, deeds of trust, security deeds, collateral mortgages, and all other instruments, agreements and
documents, whether now or hereafter existing, executed in connection with the Indebtedness.

 

EACH UNDERSIGNED GUARANTOR
ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS GUARANTY AND AGREES TO ITS TERMS. IN ADDITION, EACH GUARANTOR UNDERSTANDS THAT
THIS GUARANTY IS EFFECTIVE UPON GUARANTOR'S EXECUTION AND DELIVERY OF THIS GUARANTY TO LENDER AND THAT THE GUARANTY WILL CONTINUE
UNTIL TERMINATED IN THE MANNER SET FORTH IN THE SECTION TITLED "DURATION OF GUARANTY". NO FORMAL ACCEPTANCE BY LENDER
IS NECESSARY TO MAKE THIS GUARANTY EFFECTIVE. THIS GUARANTY IS DATED JULY 12, 2019.

 

GUARANTOR:

 

EACO CORPORATION

 

	By:	/s/ GLEN F. CEILEY 	 
		Glen F. Ceiley, CEO/CFO/Secretary of EACO  CorporationExhibit 10.4

 

 

 

The Bank Business Banks On

 

BUSINESS LOAN AGREEMENT

 

	Principal

$5,000,000.00	Loan Date

07-12-2019	Maturity

05-15-2027	Loan No

40906	Call / Coll	Account

600714	Officer

7001	Initials

CJ
	
        References in the boxes above are for Lender’s use only
        and do not limit the applicability of this document to any particular loan or item.

        Any item above containing “***”
        has been omitted due to text length limitations.

 

	Borrower:	Bisco Industries, Inc.

1500 North Lakeview Loop

Anaheim, CA 92807	 	Lender:	Citizens Business Bank

Plaza Business Financial Center

77 Plaza Square

Orange, CA 92866

	 	 	 	 	 

 

THIS BUSINESS
LOAN AGREEMENT dated July 12, 2019, is made and executed between Bisco Industries, Inc. ("Borrower") and Citizens Business
Bank ("Lender") on the following terms and conditions. Borrower has received prior commercial loans from Lender or has
applied to Lender for a commercial loan or loans or other financial accommodations, including those which may be described on
any exhibit or schedule attached to this Agreement. Borrower understands and agrees that: (A) in granting, renewing, or extending
any Loan, Lender is relying upon Borrower's representations, warranties, and agreements as set forth in this Agreement; (B) the
granting, renewing, or extending of any Loan by Lender at all times shall be subject to Lender's sole judgment and discretion;
and (C) all such Loans shall be and remain subject to the terms and conditions of this Agreement.

 

TERM. This Agreement
shall be effective as of July 12, 2019, and shall continue in full force and effect until such time as all of Borrower's Loans
in favor of Lender have been paid in full, including principal, interest, costs, expenses, attorneys' fees, and other fees and
charges, or until such time as the parties may agree in writing to terminate this Agreement.

 

CONDITIONS PRECEDENT
TO EACH ADVANCE. Lender's obligation to make the initial Advance and each subsequent Advance under this Agreement shall be
subject to the fulfillment to Lender's satisfaction of all of the conditions set forth in this Agreement and in the Related Documents.

 

Loan Documents. Borrower
shall provide to Lender the following documents for the Loan: (1) the Note; (2) Security Agreements granting to Lender security
interests in the Collateral; (3) financing statements and all other documents perfecting Lender's Security Interests; (4) evidence
of insurance as required below; (5) guaranties; (6) together with all such Related Documents as Lender may require for the Loan;
all in form and substance satisfactory to Lender and Lender's counsel.

 

Borrower's Authorization.
Borrower shall have provided in form and substance satisfactory to Lender properly certified resolutions, duly authorizing
the execution and delivery of this Agreement, the Note and the Related Documents. In addition, Borrower shall have provided such
other resolutions, authorizations, documents and instruments as Lender or its counsel, may require.

 

Payment of Fees and Expenses.
Borrower shall have paid to Lender all fees, charges, and other expenses which are then due and payable as specified in this
Agreement or any Related Document.

 

Representations and Warranties.
The representations and warranties set forth in this Agreement, in the Related Documents, and in any document or certificate
delivered to Lender under this Agreement are true and correct.

 

No Event of Default. There
shall not exist at the time of any Advance a condition which would constitute an Event of Default under this Agreement or under
any Related Document.

 

REPRESENTATIONS AND WARRANTIES.
Borrower represents and warrants to Lender, as of the date of this Agreement, as of the date of each disbursement of loan proceeds,
as of the date of any renewal, extension or modification of any Loan, and at all times any Indebtedness exists:

 

Organization. Borrower
is a corporation for profit which is, and at all times shall be, duly organized, validly existing, and in good standing under and
by virtue of the laws of the State of Illinois. Borrower is duly authorized to transact business in all other states in which Borrower
is doing business, having obtained all necessary filings, governmental licenses and approvals for each state in which Borrower
is doing business. Specifically, Borrower is, and at all times shall be, duly qualified as a foreign corporation in all states
in which the failure to so qualify would have a material adverse effect on its business or financial condition. Borrower has the
full power and authority to own its properties and to transact the business in which is presently engaged or presently proposes
to engage. Borrower maintains an office at 1500 North Lakeview Loop, Anaheim, CA 92807. Unless Borrower has designated otherwise
in writing, the principal office is the office at which Borrower keeps its books and records including its records concerning the
Collateral. Borrower will notify Lender prior to any change in the location of Borrower's state of organization or any change in
Borrower's name. Borrower shall do all things necessary to preserve and to keep in full force and effect its existence, rights
and privileges, and shall comply with all regulations, rules, ordinances, statutes, orders and decrees of any governmental or quasi-governmental
authority or court applicable to Borrower and Borrower's business activities.

 

Assumed Business Names.
Borrower has filed or recorded all documents or filings required by law relating to all assumed business names used by Borrower.
Excluding the name of Borrower, the following is a complete list of all assumed business names under which Borrower does business:
None.

 

     

    	 	BUSINESS LOAN AGREEMENT
	 
	Loan No. 40906	(Continued)
	Page 2
	 	 	 

    

 

Authorization. Borrower's
execution, delivery, and performance of this Agreement and all the Related Documents have been duly authorized by all necessary
action by Borrower and do not conflict with, result in a violation of, or constitute a default under (1) any provision of (a) Borrower's
articles of incorporation or organization, or bylaws, or (b) any agreement or other instrument binding upon Borrower or (2) any
law, governmental regulation, court decree, or order applicable to Borrower or to Borrower's properties.

 

Financial Information.
Each of Borrower's financial statements supplied to Lender truly and completely disclosed Borrower's financial condition as
of the date of the statement, and there has been no material adverse change in Borrower's financial condition subsequent to the
date of the most recent financial statement supplied to Lender. Borrower has no material contingent obligations except as disclosed
in such financial statements.

 

Legal Effect. This
Agreement constitutes, and any instrument or agreement Borrower is required to give under this Agreement when delivered will constitute
legal, valid, and binding obligations of Borrower enforceable against Borrower in accordance with their respective terms.

 

Properties. Except
as contemplated by this Agreement or as previously disclosed in Borrower's financial statements or in writing to Lender and as
accepted by Lender, and except for property tax liens for taxes not presently due and payable, Borrower owns and has good title
to all of Borrower's properties free and clear of all Security Interests, and has not executed any security documents or financing
statements relating to such properties. All of Borrower's properties are titled in Borrower's legal name, and Borrower has not
used or filed a financing statement under any other name for at least the last five (5) years.

 

Hazardous Substances.
Except as disclosed to and acknowledged by Lender in writing, Borrower represents and warrants that: (1) During the period
of Borrower's ownership of the Collateral, there has been no use, generation, manufacture, storage, treatment, disposal, release
or threatened release of any Hazardous Substance by any person on, under, about or from any of the Collateral. (2) Borrower has
no knowledge of, or reason to believe that there has been (a) any breach or violation of any Environmental Laws; (b) any use, generation,
manufacture, storage, treatment, disposal, release or threatened release of any Hazardous Substance on, under, about or from the
Collateral by any prior owners or occupants of any of the Collateral; or (c) any actual or threatened litigation or claims of any
kind by any person relating to such matters. (3) Neither Borrower nor any tenant, contractor, agent or other authorized user of
any of the Collateral shall use, generate, manufacture, store, treat, dispose of or release any Hazardous Substance on, under,
about or from any of the Collateral; and any such activity shall be conducted in compliance with all applicable federal, state,
and local laws, regulations, and ordinances, including without limitation all Environmental Laws. Borrower authorizes Lender and
its agents to enter upon the Collateral to make such inspections and tests as Lender may deem appropriate to determine compliance
of the Collateral with this section of the Agreement. Any inspections or tests made by Lender shall be at Borrower'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 Borrower
or to any other person. The representations and warranties contained herein are based on Borrower's due diligence in investigating
the Collateral for hazardous waste and Hazardous Substances. Borrower hereby (1) releases and waives any future claims against
Lender for indemnity or contribution in the event Borrower becomes liable for cleanup or other costs under any such laws, and (2)
agrees to indemnify, defend, and hold harmless Lender against any and all claims, losses, liabilities, damages, penalties, and
expenses which Lender may directly or indirectly sustain or suffer resulting from a breach of this section of the Agreement or
as a consequence of any use, generation, manufacture, storage, disposal, release or threatened release of a hazardous waste or
substance on the Collateral. The provisions of this section of the Agreement, including the obligation to indemnify and defend,
shall survive the payment of the Indebtedness and the termination, expiration or satisfaction of this Agreement and shall not be
affected by Lender's acquisition of any interest in any of the Collateral, whether by foreclosure or otherwise.

 

Litigation and
Claims. No litigation, claim, investigation, administrative proceeding or similar action (including those for unpaid
taxes) against Borrower is pending or threatened, and no other event has occurred which may materially adversely affect
Borrower's financial condition or properties, other than litigation, claims, or other events, if any, that have been
disclosed to and acknowledged by Lender in writing.

 

Taxes. To the best
of Borrower's knowledge, all of Borrower's tax returns and reports that are or were required to be filed, have been filed, and
all taxes, assessments and other governmental charges have been paid in full, except those presently being or to be contested by
Borrower in good faith in the ordinary course of business and for which adequate reserves have been provided.

 

Lien Priority. Unless
otherwise previously disclosed to Lender in writing, Borrower has not entered into or granted any Security Agreements, or permitted
the filing or attachment of any Security Interests on or affecting any of the Collateral directly or indirectly securing repayment
of Borrower's Loan and Note, that would be prior or that may in any way be superior to Lender's Security Interests and rights in
and to such Collateral.

 

Binding Effect. This
Agreement, the Note, all Security Agreements (if any), and all Related Documents are binding upon the signers thereof, as well
as upon their successors, representatives and assigns, and are legally enforceable in accordance with their respective terms.

 

AFFIRMATIVE COVENANTS. Borrower covenants
and agrees with Lender that, so long as this Agreement remains in effect, Borrower will:

 

Notices of Claims and
Litigation. Promptly inform Lender in writing of (1) all material adverse changes in Borrower's financial condition and (2)
all existing and all threatened litigation, claims, investigations, administrative proceedings or similar actions affecting Borrower
or any Guarantor which could materially affect the financial condition of Borrower or the financial condition of any Guarantor.

 

Financial Records. Maintain
its books and records in accordance with GAAP, applied on a consistent basis, and permit Lender to examine and audit Borrower's
books and records at all reasonable times.

 

Financial Statements.
Furnish Lender with the following:

 

Additional Requirements.

 

Annual Statements. As
soon as available, but in no event later than one-hundred-twenty (120) days after the end of each fiscal year on a consolidating
basis, Borrower’s balance sheet and income statement for the year ended, prepared by Borrower.

 

Interim Statements. As
soon as available, but in no event later than forty-five (45) days after the end of each fiscal quarter, Borrower’s balance
sheet and profit and loss statement for the period ended, prepared by Borrower, on a consolidating basis.

 

Brokerage Statements Borrower
to submit brokerage statements as soon as available, but in no event later than 45 days after the end of each fiscal quarter.

 

     

    	 	BUSINESS LOAN AGREEMENT
	 
	Loan No. 40906	(Continued)
	Page 3
	 	 	 

    

 

All financial reports required
to be provided under this Agreement shall be prepared in accordance with GAAP, applied on a consistent basis, and certified by
Borrower as being true and correct.

 

Additional Information.
Furnish such additional information and statements, as Lender may request from time to time.

 

Additional Requirements.

 

Debt Less Sub Debt/Effective
Tangible Net Worth Ratio. Maintain a maximum ratio of Debt Less Sub Debt/Effective Tangible Net Worth of 1.00 to 1.00 Effective
(defined as Net Worth plus Subordinated Liability(ies). The words "Tangible Net Worth" means Borrower's total assets
excluding all intangible assets (i.e., goodwill, trademarks, patents, copyrights, organizational expenses, and similar intangible
items, but including leaseholds and leasehold improvements), less total debt.

 

Debt Service Coverage
Ratio. Minimum Debt Coverage Ratio of 1.25 to 1.00 tested annually. Debt Coverage Ratio is defined as: Cash Flow Available
to Service Debt of the Borrower (defined as the sum of Net Income, plus Depreciation and Amortization Expense, plus Interest Expense,
less Distributions to Owners), divided by the sum of Current Maturities of Long Term Debt plus Interest Expense payable by the
Borrower.

 

Profitability. Maintain
a minimum net profit of $250,000.00, each fiscal quarter.

 

Insurance. Maintain
fire and other risk insurance, public liability insurance, and such other insurance as Lender may require with respect to Borrower's
properties and operations, in form, amounts, coverages and with insurance companies acceptable to Lender. Borrower, upon request
of Lender, will deliver to Lender from time to time the policies or certificates of insurance in form satisfactory to Lender, including
stipulations that coverages will not be cancelled or diminished without at least ten (10) days prior written notice to Lender.
Each insurance policy also shall include an endorsement providing that coverage in favor of Lender will not be impaired in any
way by any act, omission or default of Borrower or any other person. In connection with all policies covering assets in which Lender
holds or is offered a security interest for the Loans, Borrower will provide Lender with such lender's loss payable or other endorsements
as Lender may require.

 

Insurance Reports. Furnish
to Lender, upon request of Lender, reports on each existing insurance policy showing such information as Lender may reasonably
request, including without limitation the following: (1) the name of the insurer; (2) the risks insured; (3) the amount of the
policy; (4) the properties insured; (5) the then current property values on the basis of which insurance has been obtained, and
the manner of determining those values; and (6) the expiration date of the policy. In addition, upon request of Lender (however
not more often than annually), Borrower 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 shall be paid by Borrower.

 

Guaranties. Prior
to disbursement of any Loan proceeds, furnish executed guaranties of the Loans in favor of Lender, executed by the guarantor named
below, on Lender's forms, and in the amount and under the conditions set forth in those guaranties.

 

	Name of Guarantor	Amount 
	EACO Corporation	Unlimited

  

Other Agreements. Comply
with all terms and conditions of all other agreements, whether now or hereafter existing, between Borrower and any other party
and notify Lender immediately in writing of any default in connection with any other such agreements.

 

Loan Proceeds. Use
all Loan proceeds solely for Borrower's business operations, unless specifically consented to the contrary by Lender in writing.

 

Taxes, Charges and
Liens. Pay and discharge when due all of its indebtedness and obligations, including without limitation all assessments,
taxes, governmental charges, levies and liens, of every kind and nature, imposed upon Borrower or its 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 upon any of Borrower's properties, income, or profits. Provided however, Borrower will not be required to pay and
discharge any such assessment, tax, charge, levy, lien or claim so long as (1) the legality of the same shall be contested in
good faith by appropriate proceedings, and (2) Borrower shall have established on Borrower's books adequate reserves with
respect to such contested assessment, tax, charge, levy, lien, or claim in accordance with GAAP.

 

Performance. Perform
and comply, in a timely manner, with all terms, conditions, and provisions set forth in this Agreement, in the Related Documents,
and in all other instruments and agreements between Borrower and Lender. Borrower shall notify Lender immediately in writing of
any default in connection with any agreement.

 

Operations. Maintain
executive and management personnel with substantially the same qualifications and experience as the present executive and management
personnel; provide written notice to Lender of any change in executive and management personnel; conduct its business affairs in
a reasonable and prudent manner.

 

Environmental Studies.
Promptly conduct and complete, at Borrower's expense, all such investigations, studies, samplings and testings as may be requested
by Lender or any governmental authority relative to any substance, or any waste or by-product of any substance defined as toxic
or a hazardous substance under applicable federal, state, or local law, rule, regulation, order or directive, at or affecting any
property or any facility owned, leased or used by Borrower.

 

Compliance with Governmental
Requirements. Comply with all laws, ordinances, and regulations, now or hereafter in effect, of all governmental authorities
applicable to the conduct of Borrower's properties, businesses and operations, and to the use or occupancy of the Collateral, including
without limitation, the Americans With Disabilities Act. Borrower may contest in good faith any such law, ordinance, or regulation
and withhold compliance during any proceeding, including appropriate appeals, so long as Borrower has notified Lender in writing
prior to doing so and so long as, in Lender's sole opinion, Lender's interests in the Collateral are not jeopardized. Lender may
require Borrower to post adequate security or a surety bond, reasonably satisfactory to Lender, to protect Lender's interest.

 

     

    	 	BUSINESS LOAN AGREEMENT
	 
	Loan No. 40906	(Continued)
	Page 4
	 	 	 

    

 

Inspection. Permit
employees or agents of Lender at any reasonable time to inspect any and all Collateral for the Loan or Loans and Borrower's other
properties and to examine or audit Borrower's books, accounts, and records and to make copies and memoranda of Borrower's books,
accounts, and records. If Borrower now or at any time hereafter maintains any records (including without limitation computer generated
records and computer software programs for the generation of such records) in the possession of a third party, Borrower, upon request
of Lender, shall notify such party to permit Lender free access to such records at all reasonable times and to provide Lender with
copies of any records may request, all at Borrower's expense.

 

Compliance Certificates.
Unless waived in writing by Lender, provide Lender at least annually, with a certificate executed by Borrower's chief financial
officer, or other officer or person acceptable to Lender, certifying that the representations and warranties set forth in this
Agreement are true and correct as of the date of the certificate and further certifying that, as of the date of the certificate,
no Event of Default exists under this Agreement.

 

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

 

Additional Assurances.
Make, execute and deliver to Lender such promissory notes, mortgages, deeds of trust, security agreements, assignments, financing
statements, instruments, documents and other agreements as Lender or its attorneys may reasonably request to evidence and secure
the Loans and to perfect all Security Interests.

 

LENDER'S EXPENDITURES.
If any action or proceeding is commenced that would materially affect Lender's interest in the Collateral or Borrower fails
to comply with any provision of this Agreement or any Related Documents, including but not limited to Borrower's failure to discharge
or pay when due any amounts Borrower is required to discharge or pay under this Agreement or any Related Documents, Lender on Borrower's
behalf may (but shall not be obligated to) take any action that Lender deems appropriate, including but not limited to discharging
or paying all taxes, liens, security interests, encumbrances and other claims, at any time levied or placed on any Collateral and
paying all costs for insuring, maintaining and preserving any Collateral. All such expenditures incurred or paid by Lender for
such purposes will then bear interest at the rate charged under the Note from the date incurred or paid by Lender to the date of
repayment by Borrower. All such expenses will become a part of the Indebtedness and, at Lender's option, will (A) be payable on
demand; (B) be added to the balance of the Note and be apportioned among and be payable with any installment payments to become
due during either (1) the term of any applicable insurance policy; or (2) the remaining term of the Note; or (C) be treated as
a balloon payment which will be due and payable at the Note's maturity.

 

NEGATIVE COVENANTS. Borrower
covenants and agrees with Lender that while this Agreement is in effect, Borrower shall not, without the prior written consent
of Lender:

 

Continuity of Operations.
(1) Engage in any business activities substantially different than those in which Borrower is presently engaged, (2) cease
operations, liquidate, merge or restructure as a legal entity (whether by division or otherwise), consolidate with or acquire any
other entity, change its name, convert to another type of entity or redomesticate, dissolve or transfer or sell Collateral out
of the ordinary course of business, or (3) pay any dividends on Borrower's stock (other than dividends payable in its stock), 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, Borrower is a "Subchapter S Corporation" (as defined in the Internal Revenue Code of 1986,
as amended), Borrower may pay cash dividends on its stock to its shareholders from time to time in amounts necessary to enable
the shareholders to pay income taxes and make estimated income tax payments to satisfy their liabilities under federal and state
law which arise solely from their status as Shareholders of a Subchapter S Corporation because of their ownership of shares of
Borrower's stock, or purchase or retire any of Borrower's outstanding shares or alter or amend Borrower's capital structure.

 

Loans, Acquisitions and
Guaranties. (1) Loan, invest in or advance money or assets to any other person, enterprise or entity, (2) purchase, create
or acquire any interest in any other enterprise or entity, or (3) incur any obligation as surety or guarantor other than in the
ordinary course of business.

 

Agreements. Enter
into any agreement containing any provisions which would be violated or breached by the performance of Borrower's obligations under
this Agreement or in connection herewith.

 

CESSATION
OF ADVANCES. If Lender has made any commitment to make any Loan to Borrower, whether under this Agreement or under
any other agreement, Lender shall have no obligation to make Loan Advances or to disburse Loan proceeds if (A) Borrower
or any Guarantor is in default under the terms of this Agreement or any of the Related Documents or any other agreement
that Borrower or any Guarantor has with Lender; (B) Borrower or any Guarantor dies, becomes incompetent or becomes
insolvent, files a petition in bankruptcy or similar proceedings, or is adjudged a bankrupt; (C) there occurs a material
adverse change in Borrower's financial condition, in the financial condition of any Guarantor, or in the value of any
Collateral securing any Loan; or (D) any Guarantor seeks, claims or otherwise attempts to limit, modify or revoke such
Guarantor's guaranty of the Loan or any other loan with Lender.

 

RIGHT OF SETOFF. To
the extent permitted by applicable law, Lender reserves a right of setoff in all Borrower's accounts with Lender (whether checking,
savings, or some other account). This includes all accounts Borrower holds jointly with someone else and all accounts Borrower
may open in the future. However, this does not include any IRA or Keogh accounts, or any trust accounts for which setoff would
be prohibited by law. Borrower authorizes Lender, to the extent permitted by applicable law, to charge or setoff all sums owing
on the Indebtedness against any and all such accounts.

 

     

    	 	BUSINESS LOAN AGREEMENT
	 
	Loan No. 40906	(Continued)
	Page 5
	 	 	 

    

 

DEFAULT. Each of
the following shall constitute an Event of Default under this Agreement:

 

Payment Default. Borrower
fails to make any payment when due under the Loan.

 

Transfers, Indebtedness
and Liens. Borrower, without the prior written consent of Lender, fails to continue to own all of Borrower's assets, except
for routine transfers, use or depletion in the ordinary course of Borrower's business; Borrower, without the prior written consent
of Lender, creates or grants to any person, except Lender, any lien, security interest, encumbrance, cloud on title, mortgage,
pledge or similar interest in any of Borrower's property, even in the ordinary course of Borrower's business; or, Borrower, without
the prior written consent of Lender, sells, conveys, grants leases, gives, contributes, assigns, or otherwise transfers any of
Borrower's assets, except for sales of inventory or leases of goods in the ordinary course of Borrower's business. (Initial
Here ________ )

 

Other Defaults. Borrower
fails to comply with or to perform any other term, obligation, covenant or condition contained in this Agreement or in any of the
Related Documents or to comply with or to perform any term, obligation, covenant or condition contained in any other agreement
between Lender and Borrower.

 

Environmental Default.
Failure of any party to comply with or perform when due any term, obligation, covenant or condition contained in any environmental
agreement executed in connection with any Loan.

 

Default in Favor of Third
Parties. Borrower or any Grantor defaults under any loan, extension of credit, security agreement, purchase or sales agreement,
or any other agreement, in favor of any other creditor or person that may materially affect any of Borrower's or any Grantor's
property or Borrower's or any Grantor's ability to repay the Loans or perform their respective obligations under this Agreement
or any of the Related Documents.

 

False Statements. Any
warranty, representation or statement made or furnished to Lender by Borrower or on Borrower's behalf under this Agreement or the
Related Documents is false or misleading in any material respect, either now or at the time made or furnished or becomes false
or misleading at any time thereafter.

 

Insolvency. The dissolution
or termination of Borrower's existence as a going business, the insolvency of Borrower, the appointment of a receiver for any part
of Borrower's property, any assignment for the benefit of creditors, any type of creditor workout, or the commencement of any proceeding
under any bankruptcy or insolvency laws by or against Borrower.

 

Defective Collateralization.
This Agreement or any of the Related Documents ceases to be in full force and effect (including failure of any collateral document
to create a valid and perfected security interest or lien) at any time and for any reason.

 

Creditor or
Forfeiture Proceedings. Commencement of foreclosure or forfeiture proceedings, whether by judicial proceeding, self-help,
repossession or any other method, by any creditor of Borrower or by any governmental agency against any collateral securing
the Loan. This includes a garnishment of any of Borrower's accounts, including deposit accounts, with Lender. However, this
Event of Default shall not apply if there is a good faith dispute by Borrower as to the validity or reasonableness of the
claim which is the basis of the creditor or forfeiture proceeding and Borrower gives Lender written notice of the creditor or
forfeiture proceeding and deposits with Lender monies or a surety bond for the creditor or forfeiture proceeding, in an
amount determined by Lender, in its sole discretion, as being an adequate reserve or bond for the dispute.

 

Events Affecting Guarantor.
Any of the preceding events occurs with respect to any Guarantor of any of the Indebtedness or any Guarantor dies or becomes
incompetent, or revokes or disputes the validity of, or liability under, any Guaranty of the Indebtedness.

 

Change in Ownership. Any
change in ownership of twenty-five percent (25%) or more of the common stock of Borrower.

 

Adverse Change. A
material adverse change occurs in Borrower's financial condition, or Lender believes the prospect of payment or performance of
the Loan is impaired.

 

Right to Cure. If
any default, other than a default on Indebtedness, is curable and Borrower or Grantor, as the case may be, has not been
given a notice of a similar default within the preceding twelve (12) months, it may be cured if Borrower or Grantor, as the
case may be, after Lender sends written notice to Borrower or Grantor, as the case may be, demanding cure of such default:
(1) cure the default within fifteen (15) days; or (2) if the cure requires more than fifteen (15) days, immediately initiate
steps which Lender deems in Lender's sole discretion to be sufficient to cure the default and thereafter continue and
complete all reasonable and necessary steps sufficient to produce compliance as soon as reasonably practical.

 

EFFECT OF AN EVENT OF
DEFAULT. If any Event of Default shall occur, except where otherwise provided in this Agreement or the Related Documents, all
commitments and obligations of Lender under this Agreement or the Related Documents or any other agreement immediately will terminate
(including any obligation to make further Loan Advances or disbursements), and, at Lender's option, all Indebtedness immediately
will become due and payable, all without notice of any kind to Borrower, except that in the case of an Event of Default of the
type described in the "Insolvency" subsection above, such acceleration shall be automatic and not optional. In addition,
Lender shall have all the rights and remedies provided in the Related Documents or available at law, in equity, or otherwise. Except
as may be prohibited by applicable law, all of Lender's rights and remedies shall be cumulative and may be exercised singularly
or concurrently. Election by Lender to pursue any remedy shall not exclude pursuit of any other remedy, and an election to make
expenditures or to take action to perform an obligation of Borrower or of any Grantor shall not affect Lender's right to declare
a default and to exercise its rights and remedies.

 

COUNTERPARTS. This
document may be executed in any number of counterparts and by different parties on separate counterparts, each of which when executed
and delivered, shall be deemed to be an original, and all of which, when taken together, shall constitute but one and the same
agreement.

 

ADDITIONAL PROVISION.
The paragraph entitled Compliance with Governmental Requirements is hereby amended and restated as follows:

 

Compliance with Governmental
Requirements. Comply with all laws, ordinances, and regulations, now or hereafter in effect, of all governmental authorities
applicable to the conduct of Borrower's properties, businesses and operations, and to the use or occupancy of the Collateral, including
without limitation, the Americans With Disabilities Act and any federal, state or local prohibitions on illegal use, occupancy
or activity, including without limitation, any sale or use of marijuana or other illegal drugs, whether or not for medicinal purposes.
Borrower may contest in good faith any such law, ordinance, or regulation and withhold compliance during any proceeding, including
appropriate appeals, so long as Borrower has notified Lender in writing prior to doing so and so long as, in Lender's sole opinion,
Lender's interests in the Collateral are not jeopardized, provided that in no event may Borrower permit or enable any Collateral
to be used or occupied by any business or pursuant to any lease or other arrangement for the purpose of dispensing marijuana or
other illegal drugs for any purpose (medicinal or otherwise). Lender may require Borrower to post adequate security or a surety
bond, reasonably satisfactory to Lender, to protect Lender's interest.

 

     

    	 	BUSINESS LOAN AGREEMENT
	 
	Loan No. 40906	(Continued)
	Page 6
	 	 	 

    

 

MISCELLANEOUS PROVISIONS.
The following miscellaneous provisions are a part of this Agreement:

 

Amendments. This Agreement,
together with any Related Documents, constitutes the entire understanding and agreement of the parties as to the matters set forth
in this Agreement. No alteration of or amendment to this Agreement shall be effective unless given in writing and signed by the
party or parties sought to be charged or bound by the alteration or amendment.

 

Arbitration. Borrower
and Lender agree that all disputes, claims and controversies between them whether individual, joint, or class in nature, arising
from this Agreement or otherwise, including without limitation contract and tort disputes, shall be arbitrated pursuant to the
financial services rules of J.A.M.S. or its successor in effect at the time the claim is filed, upon request of either party. No
act to take or dispose of any Collateral shall constitute a waiver of this arbitration agreement or be prohibited by this arbitration
agreement. This includes, without limitation, obtaining injunctive relief or a temporary restraining order; invoking a power of
sale under any deed of trust or mortgage; obtaining a writ of attachment or imposition of a receiver; or exercising any rights
relating to personal property, including taking or disposing of such property with or without judicial process pursuant Article
9 of the Uniform Commercial Code. Any disputes, claims, or controversies concerning the lawfulness or reasonableness of any act,
or exercise of any right, concerning any Collateral, including any claim to rescind, reform, or otherwise modify any agreement
relating to the Collateral, shall also be arbitrated, provided however that no arbitrator shall have the right or the power to
enjoin or restrain any act of any party. Borrower and Lender agree that in the event of an action for judicial foreclosure pursuant
to California Code of Civil Procedure Section 726, or any similar provision in any other state, the commencement of such an action
will not constitute a waiver of the right to arbitrate and the court shall refer to arbitration as much of such action, including
counterclaims, as lawfully may be referred to arbitration. Judgment upon any award rendered by any arbitrator may be entered in
any court having jurisdiction. Nothing in this Agreement shall preclude any party from seeking equitable relief from a court of
competent jurisdiction. The statute of limitations, estoppel, waiver, laches, and similar doctrines which would otherwise be applicable
in an action brought by a party shall be applicable in any arbitration proceeding, and the commencement of an arbitration proceeding
shall be deemed the commencement of an action for these purposes. The Federal Arbitration Act shall apply to the construction,
interpretation, and enforcement of this arbitration provision.

 

Attorneys' Fees; Expenses.
Borrower agrees to pay upon demand all of Lender's costs and expenses, including Lender's attorneys' fees and Lender's legal
expenses, incurred in connection with the enforcement of this Agreement. Lender may hire or pay someone else to help enforce this
Agreement, and Borrower shall pay the costs and expenses of such enforcement. Costs and expenses include Lender's attorneys' fees
and legal expenses whether or not there is a lawsuit, including attorneys' fees and legal expenses for bankruptcy proceedings (including
efforts to modify or vacate any automatic stay or injunction), appeals, and any anticipated post-judgment collection services.
Borrower also shall pay all court costs and such additional fees as may be directed by the court.

 

Caption Headings. Caption
headings in this Agreement are for convenience purposes only and are not to be used to interpret or define the provisions of this
Agreement.

 

Consent to Loan
Participation. Borrower agrees and consents to Lender's sale or transfer, whether now or later, of one or more
participation interests in the Loan to one or more purchasers, whether related or unrelated to Lender. Lender may provide,
without any limitation whatsoever, to any one or more purchasers, or potential purchasers, any information or knowledge
Lender may have about Borrower or about any other matter relating to the Loan, and Borrower hereby waives any rights to
privacy Borrower may have with respect to such matters. Borrower additionally waives any and all notices of sale of
participation interests, as well as all notices of any repurchase of such participation interests. Borrower also agrees that
the purchasers of any such participation interests will be considered as the absolute owners of such interests in the Loan
and will have all the rights granted under the participation agreement or agreements governing the sale of such participation
interests. Borrower further waives all rights of offset or counterclaim that it may have now or later against Lender or
against any purchaser of such a participation interest and unconditionally agrees that either Lender or such purchaser may
enforce Borrower's obligation under the Loan irrespective of the failure or insolvency of any holder of any interest in the
Loan. Borrower further agrees that the purchaser of any such participation interests may enforce its interests irrespective
of any personal claims or defenses that Borrower may have against Lender.

 

Governing Law. This
Agreement will be governed by federal law applicable to Lender and, to the extent not preempted by federal law, the laws of the
State of California without regard to its conflicts of law provisions. This Agreement has been accepted by Lender in the State
of California.

 

Choice of Venue. If
there is a lawsuit, Borrower agrees upon Lender's request to submit to the jurisdiction of the courts of Orange County, State of
California.

 

No Waiver by Lender. Lender
shall not be deemed to have waived any rights under this Agreement unless such waiver is given in writing and signed by Lender.
No delay or omission on the part of Lender in exercising any right shall operate as a waiver of such right or any other right.
A waiver by Lender of a provision of this Agreement shall not prejudice or constitute a waiver of Lender's right otherwise to demand
strict compliance with that provision or any other provision of this Agreement. No prior waiver by Lender, nor any course of dealing
between Lender and Borrower, or between Lender and any Grantor, shall constitute a waiver of any of Lender's rights or of any of
Borrower's or any Grantor's obligations as to any future transactions. Whenever the consent of Lender is required under this Agreement,
the granting of such consent by Lender in any instance shall not constitute continuing consent to subsequent instances where such
consent is required and in all cases such consent may be granted or withheld in the sole discretion of Lender.

 

Notices. Any notice
required to be given under this Agreement shall be given in writing, and shall be effective when actually delivered, when actually
received by telefacsimile (unless otherwise required by law), when deposited with a nationally recognized overnight courier, or,
mailed, when deposited in the United States mail, as first class, certified or registered mail postage prepaid, directed to the
addresses shown near the beginning of this Agreement. Any party may change its address for notices under this Agreement by giving
formal written notice to the other parties, specifying that the purpose of the notice is to change the party's address. For notice
purposes, Borrower agrees to keep Lender informed at all times of Borrower's current address. Unless otherwise provided or required
by law, there is more than one Borrower, any notice given by Lender to any Borrower is deemed to be notice given to all Borrowers.

 

     

    	 	BUSINESS LOAN AGREEMENT
	 
	Loan No. 40906	(Continued)
	Page 7
	 	 	 

    

 

Severability. If
a court of competent jurisdiction finds any provision of this Agreement to be illegal, invalid, or unenforceable as to
any circumstance, that finding shall not make the offending provision illegal, invalid, or unenforceable as to any
other circumstance. If feasible, the offending provision shall be considered modified so that it becomes legal, valid and
enforceable. If the offending provision cannot be so modified, it shall be considered deleted from this Agreement. Unless
otherwise required by law, the illegality, invalidity, or unenforceability of any provision of this Agreement shall not
affect the legality, validity or enforceability of any other provision of this Agreement.

 

Subsidiaries and
Affiliates of Borrower. To the extent the context of any provisions of this Agreement makes it appropriate, including
without limitation any representation, warranty or covenant, the word "Borrower" as used in this Agreement shall
include all of Borrower's subsidiaries and affiliates. Notwithstanding the foregoing however, under no circumstances shall
this Agreement be construed to require Lender to make any Loan or other financial accommodation to any of Borrower's
subsidiaries or affiliates.

 

Successors and Assigns.
All covenants and agreements by or on behalf of Borrower contained in this Agreement or any Related Documents shall bind Borrower's
successors and assigns and shall inure to the benefit of Lender and its successors and assigns. Borrower shall not, however, have
the right to assign Borrower's rights under this Agreement or any interest therein, without the prior written consent of Lender.

 

Survival of Representations
and Warranties. Borrower understands and agrees that in making the Loan, Lender is relying on all representations, warranties,
and covenants made by Borrower in this Agreement or in any certificate or other instrument delivered by Borrower to Lender under
this Agreement or the Related Documents. Borrower further agrees that regardless of any investigation made by Lender, all such
representations, warranties and covenants will survive the making of the Loan and delivery to Lender of the Related Documents,
shall be continuing in nature, and shall remain in full force and effect until such time as Borrower's Indebtedness shall be paid
in full, or until this Agreement shall be terminated in the manner provided above, whichever is the last to occur.

 

Time is of the Essence.
Time is of the essence in the performance of this Agreement.

 

Waive Jury. To the extent
permitted by applicable law, all parties to this Agreement hereby waive the right to any jury trial in any action, proceeding,
or counterclaim brought by any party against any other party.

 

DEFINITIONS. The
following capitalized words and terms shall have the following meanings when used in this Agreement. Unless specifically stated
to the contrary, all references to dollar amounts shall mean amounts in lawful money of the United States of America. Words and
terms used in the singular shall include the plural, and the plural shall include the singular, as the context may require. Words
and terms not otherwise defined in this Agreement shall have the meanings attributed to such terms in the Uniform Commercial Code.
Accounting words and terms not otherwise defined in this Agreement shall have the meanings assigned to them in accordance with
generally accepted accounting principles as in effect on the date of this Agreement:

 

Advance. The word
"Advance" means a disbursement of Loan funds made, or to be made, to Borrower or on Borrower's behalf on a line of credit
or multiple advance basis under the terms and conditions of this Agreement.

 

Agreement. The word
"Agreement" means this Business Loan Agreement, as this Business Loan Agreement may be amended or modified from time
to time, together with all exhibits and schedules attached to this Business Loan Agreement from time to time.

 

Borrower. The word
"Borrower" means Bisco Industries, Inc. and includes all co-signers and co-makers signing the Note and all their successors
and assigns.

 

Collateral. The word
"Collateral" means all property and assets granted as collateral security for a Loan, whether real or personal property,
whether granted directly or indirectly, whether granted now or in the future, and whether granted in the form of a security interest,
mortgage, collateral mortgage, deed of trust, assignment, pledge, crop pledge, chattel mortgage, collateral chattel mortgage, chattel
trust, factor's lien, equipment trust, conditional sale, trust receipt, lien, charge, lien or title retention contract, lease or
consignment intended as a security device, or any other security or lien interest whatsoever, whether created by law, contract,
or otherwise.

 

Environmental Laws. The
words "Environmental Laws" mean any and all state, federal and local statutes, regulations and ordinances relating to
the protection of human health or the environment, including without limitation the Comprehensive Environmental Response, Compensation,
and Liability Act of 1980, as amended, 42 U.S.C. Section 9601, et seq. ("CERCLA"), the Superfund Amendments and Reauthorization
Act of 1986, Pub. L. No. 99-499 ("SARA"), the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.,
the Resource Conservation 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
thereto.

 

Event of Default. The
words "Event of Default" mean any of the events of default set forth in this Agreement in the default section of this
Agreement.

 

GAAP. The word "GAAP"
means generally accepted accounting principles.

 

Grantor. The word
"Grantor" means each and all of the persons or entities granting a Security Interest in any Collateral for the Loan,
including without limitation all Borrowers granting such a Security Interest.

 

Guarantor. The word
"Guarantor" means any guarantor, surety, or accommodation party of any or all of the Loan.

 

Guaranty. The word
"Guaranty" means the guaranty from Guarantor to Lender, including without limitation a guaranty of all or part of the
Note.

 

Hazardous Substances.
The words "Hazardous Substances" mean materials that, because of their quantity, concentration or physical, chemical
or infectious characteristics, may cause or pose a present or potential hazard to human health or the environment when improperly
used, treated, stored, disposed of, generated, manufactured, transported or otherwise handled. The words "Hazardous Substances"
are used in their very broadest sense and include without limitation any and all hazardous or toxic substances, materials or waste
as defined by or listed under the Environmental Laws. The term "Hazardous Substances" also includes, without limitation,
petroleum and petroleum by-products or any fraction thereof and asbestos.

 

Indebtedness. The
word "Indebtedness" means the indebtedness evidenced by the Note or Related Documents, including all principal and interest
together with all other indebtedness and costs and expenses for which Borrower is responsible under this Agreement or under any
of the Related Documents.

 

     

    	 	BUSINESS LOAN AGREEMENT
	 
	Loan No. 40906	(Continued)
	Page 8
	 	 	 

    

 

Lender. The word "Lender"
means Citizens Business Bank, its successors and assigns.

 

Loan. The word "Loan"
means any and all loans and financial accommodations from Lender to Borrower whether now or hereafter existing, and however evidenced,
including without limitation those loans and financial accommodations described herein or described on any exhibit or schedule
attached to this Agreement from time to time.

 

Note. The word "Note"
means the Note dated July 12, 2019 and executed by Bisco Industries, Inc. in the principal amount of $5,000,000.00, together with
all renewals of, extensions of, modifications of, refinancings of, consolidations of, and substitutions for the note or credit
agreement.

 

Related Documents. The
words "Related Documents" mean all promissory notes, credit agreements, loan agreements, environmental agreements, guaranties,
security agreements, mortgages, deeds of trust, security deeds, collateral mortgages, and all other instruments, agreements and
documents, whether now or hereafter existing, executed in connection with the Loan.

 

Security Agreement. The
words "Security Agreement" mean and include without limitation any agreements, promises, covenants, arrangements, understandings
or other agreements, whether created by law, contract, or otherwise, evidencing, governing, representing, or creating a Security
Interest.

 

Security Interest. The
words "Security Interest" mean, without limitation, any and all types of collateral security, present and future, whether
in the fo`rm of a lien, charge, encumbrance, mortgage, deed of trust, security deed, assignment, pledge, crop pledge, chattel mortgage,
collateral chattel mortgage, chattel trust, factor's lien, equipment trust, conditional sale, trust receipt, lien or title retention
contract, lease or consignment intended as a security device, or any other security or lien interest whatsoever whether created
by law, contract, or otherwise.

 

BORROWER ACKNOWLEDGES
HAVING READ ALL THE PROVISIONS OF THIS BUSINESS LOAN AGREEMENT AND BORROWER AGREES TO ITS TERMS. THIS BUSINESS LOAN AGREEMENT IS
DATED JULY 12, 2019.

 

	BORROWER:	 
	 	 
	BISCO INDUSTRIES, INC.	 
	 	 
	 	 
	By:  	/s/ Glen F. Ceiley	 
	 	Glen F. Ceiley, Pres./CEO/CFO/Secretary of Bisco	 
	 	Industries, Inc.	 
	 	 	 
	 	 	 
	LENDER:	 
	 	 
	CITIZENS BUSINESS BANK	 
	 	 
	 	 
	By:	/s/ Cassaundra Johnson	 
	 	Authorized Officer

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