Document:

Exhibit 10.3

 

PROMISSORY NOTE

 

	Principal	Loan Date	Maturity	Loan No	Call / Coll	Account	Officer	Initials
	$
    10,000,000.00	07-14-2016	03-01-2018	155354101	 	 	765	 
	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.	 	Lender:	COMMUNITY BANK
	 	1500 NORTH LAKEVIEW AVENUE	 	 	ANAHEIM BRANCH
	 	ANAHEIM, CA 92807	 	 	1750 S. STATE COLLEGE BLVD.
	 	 	 	 	ANAHEIM, CA 92806
	 	 	 	 	(800) 788-9999

 

 

 

	Principal Amount: $10,000,000.00	Date of Note: July 14, 2016

 

PROMISE TO PAY. BISCO INDUSTRIES, INC.
(“Borrower”) promises to pay to COMMUNITY BANK (“Lender”), or order, in lawful money of the United States
of America, the principal amount of Ten Million & 00/100 Dollars ($10,000,000.00) or so much as may be outstanding, together
with Interest on the unpaid outstanding principal balance of each advance. Interest shall be calculated from the date of each
advance until repayment of each advance.

 

PAYMENT. Borrower will pay this loan in
one payment of all outstanding principal plus all accrued unpaid interest on March 1, 2018. In addition, Borrower will pay regular
monthly payments of all accrued unpaid interest due as of each payment date, beginning August 1, 2016, with all subsequent interest
payments to be due on the same day of each month after that. Unless otherwise agreed or required by applicable law, payments will
be applied to any accrued unpaid interest; then to principal; then to late charges; then to any unpaid collection costs. Borrower
will pay Lender at Lender’s address shown above or at such other place as Lender may designate in writing.

 

VARIABLE INTEREST RATE. The interest
rate on this Note is subject to change from time to time based on changes in an independent index which is the Wall Street Journal
Prime Rate, which is the Prime Rate published in the “Money Rates” section of the Wall Street Journal from time to
time (the “Index”), The Index is not necessarily the lowest rate charged by Lender on Its loans. If the Index becomes
unavailable during the term of this loan, Lender may designate a substitute index after notifying Borrower. Lender will tell Borrower
the current Index rate upon Borrower’s request. The interest rate change will not occur more often than each day. Borrower understands
that Lender may make loans based on other rates as well. The Index currently Is 3.500% per annum. Interest on the unpaid
principal balance of this Note will be calculated as described in the “INTEREST CALCULATION METHOD” paragraph using
a rate equal to the Index, resulting in an initial rate of 3.500%. NOTICE: Under no circumstances wilt the interest rate on this
Note be more than the maximum rate allowed by applicable law.

 

INTEREST CALCULATION METHOD. Interest on
this Note is computed on a 365/360 basis; that is, by applying the ratio of the interest rate over a year of 360 days, multiplied
by the outstanding principal balance, multiplied by the actual number of days the principal balance is outstanding. All interest
payable under this Note is computed using this method.

 

PREPAYMENT. Borrower agrees that all
loan fees and other prepaid finance charges are earned fully as of the date ofthe loan and will not be subject to refund upon
early payment (whether voluntary or as a result of default), except as otherwise required by law. Except for the foregoing, Borrower
may pay without penalty all or a portion of the amount owed earlier than it is due. Early payments will not, unless agreed to
by Lender in writing, relieve Borrower of Borrower’s obligation to continue to make payments of accrued unpaid interest.
Rather, early payments will reduce the principal balance due. Borrower agrees not to send Lender payments marked “paid in
full”, “without recourse”, or similar language. If Borrower sends such a payment, Lender may accept it
without losing any of Lender’s rights under this Note, and Borrower will remain obligated to pay any further amount owed
to Lender. All written communications concerning disputed amounts, including any check or other payment instrument that
indicates that the payment constitutes “payment in full” of the amount owed or that is tendered with other conditions
or limitations or as full satisfaction of a disputed amount must be mailed or delivered to: COMMUNITY BANK, ANAHEIM BRANCH, 1750
S. STATE COLLEGE BLVD., ANAHEIM, CA 92806.

 

LATE CHARGE. If a payment is 10 days
or more late, Borrower will be charged 6.000% of the unpaid portion of the regularly scheduled payment or $5.00, whichever
is greater.

 

INTEREST AFTER DEFAULT. Upon default,
the interest rate on this Note shall, if permitted under applicable law, immediately increase by adding an additional 5.000 percentage
point margin (“Default Rate Margin”). The Default Rate Margin shall also apply to each succeeding interest rate change
that would have applied had there been no default.

 

DEFAULT. Each of the following shall
constitute an event of default (“Event of Default”) under this Note:

 

Payment Default. Borrower fails to make
any payment when due under this Note.

 

Other Defaults. Borrower fails to comply
with or to perform any other term, obligation, covenant or condition contained in this Note 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.

 

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 property or Borrower’s
ability to repay this Note or perform Borrower’s obligations under this Note 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 Note 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.

 

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 if 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 evidenced by this Note.

 

     

     

    

 

	 	PROMISSORY
    NOTE	 
	Loan No: 155354101	(Continued)	Page 2

 

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 this Note is impaired.

 

Insecurity. Lender in good faith believes
itself insecure.

 

Cure Provisions. If any default, other
than a default in payment, is curable and if Borrower has not been given a notice of a breach of the same provision of this Note
within the preceding twelve (12) months, it may be cured if Borrower, after Lender sends written notice to Borrower demanding
cure of such default: (1) cures the default within fifteen (15) days; or (2) if the cure requires more than fifteen (15) days,
immediately initiates steps which Lender deems in Lender’s sole discretion to be sufficient to cure the default and thereafter
continues and completes all reasonable and necessary steps sufficient to produce compliance as soon as reasonably practical.

 

LENDER’S RIGHTS. Upon default, Lender
may declare the entire unpaid principal balance under this Note and all accrued unpaid interest immediately due, and then Borrower
will pay that amount.

 

ATTORNEYS’ FEES; EXPENSES. Lender may
hire or pay someone else to help collect this Note if Borrower does not pay. Borrower will pay Lender that amount. This includes,
subject to any limits under applicable law, Lender’s attorneys’ fees and Lender’s legal expenses, whether or not there is a lawsuit,
including attorneys’ fees, expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction),
and appeals. Borrower also will pay any court costs, in addition to all other sums provided by law.

 

GOVERNING LAW. This Note 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 Note 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.

 

DISHONORED ITEM FEE. Borrower will
pay a fee to Lender of $15.00 if Borrower makes a payment on Borrower’s loan and the check or preauthorized charge with
which Borrower pays is later dishonored.

 

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, and, at Lender’s option, to administratively freeze all such accounts to allow Lender to protect
Lender’s charge and setoff rights provided in this paragraph.

 

COLLATERAL. Borrower acknowledges this
Note is secured by Collateral as described per Commercial Security Agreement of even date.

 

LINE OF CREDIT. This Note evidences
a revolving line of credit. Advances under this Note may be requested either orally or in writing by Borrower or as provided in
this paragraph. Lender may, but need not, require that all oral requests be confirmed in writing. All communications, instructions,
or directions by telephone or otherwise to Lender are to be directed to Lender’s office shown above. The following person or persons
are authorized to request advances and authorize payments under the line of credit until Lender receives from Borrower, at Lender’s
address shown above, written notice of revocation of such authority: GLEN F. CEILEY, Chairman/CEO of BISCO INDUSTRIES, INC.
Borrower agrees to be liable for all sums either: (A) advanced in accordance with the instructions of an authorized person
or (B) credited to any of Borrower’s accounts with Lender. The unpaid principal balance owing on this Note at any time may be
evidenced by endorsements on this Note or by Lender’s internal records, including daily computer print-outs.

 

COUNTERPARTS. This agreement, document
or instrument 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 taken together shall constitute one and the same agreement,
document or instrument. Delivery by facsimile or by electronic transmission in portable document format (PDF) of an executed counterpart
of this agreement, document or instrument is as effective as delivery of an originally executed counterpart of this agreement,
document or instrument.

 

JUDICIAL REFERENCE. Borrower and Lender
agree that any dispute, action, proceeding or hearing (’‘Dispute”) arising out of, or relating to, this Agreement shall be
determined by a consensual general judicial reference pursuant to the provisions of California Code of Civil Procedure Section
638 et seq.; as such statutes may be amended or modified from time to time. Upon a written request, or upon an appropriate motion
by either party to this Agreement, any pending action relating to any Dispute and every Dispute shall be heard by a retired judge
or justice of the courts of the State of California or a federal court judge (the “Referee’’), who shall try all issues (including
any and all questions of law and questions of fact relating thereto), and issue findings of fact and conclusions of law and report
a statement of decision. The Referee’s statement of decision will constitute the conclusive determination of the Dispute.
Borrower and Lender agree that the Referee shall have the power to issue all legal and equitable relief appropriate under the
circumstances before him/her in the same manner as would a judge sitting without a jury.

 

PRIOR NOTE. This Promissory Note amends
and restates that certain prior Promissory Note dated November 15, 2000 along with all modification(s) and amendment(s) thereto.

 

SUCCESSOR INTERESTS. The terms of this
Note shall be binding upon Borrower, and upon Borrower’s heirs, personal representatives, successors and assigns, and shall inure
to the benefit of Lender and its successors and assigns.

 

NOTIFY US OF INACCURATE INFORMATION WE REPORT
TO CONSUMER REPORTING AGENCIES. Borrower may notify Lender if Lender reports any inaccurate information about Borrower’s account(s)
to a consumer reporting agency. Borrower’s written notice describing the specific inaccuracy(ies) should be sent to Lender at the
following address: COMMUNITY BANK Loan Support Group P.O. Box 54477 Los Angeles, CA 90054.

 

GENERAL PROVISIONS. If any part of
this Note cannot be enforced, this fact will not affect the rest of the Note. Lender may delay or forgo enforcing any of its rights
or remedies under this Note without losing them. Borrower and any other person who signs, guarantees or endorses this Note, to
the extent allowed by law, waive any applicable statute of limitations, presentment, demand for payment, and notice of dishonor.
Upon any change in the terms of this Note, and unless otherwise expressly stated in writing, no party who signs this Note, whether
as maker, guarantor, accommodation maker or endorser, shall be released from liability. All such parties agree that Lender may
renew or extend (repeatedly and for any length of time) this loan or release any party or guarantor or collateral; or impair,
fail to realize upon or perfect Lender’s security interest in the collateral; and take any other action deemed necessary by Lender
without the consent of or notice to anyone. All such parties also agree that Lender may modify this loan without the consent of
or notice to anyone other than the party with whom the modification is made. The obligations under this Note are joint and several.

 

     

     

    

 

	 	PROMISSORY
    NOTE	 
	Loan No: 155354101	(Continued)	Page 3

 

ILLINOIS INSURANCE NOTICE. Unless Borrower
provides Lender with evidence of the insurance coverage required by Borrower’s agreement with Lender, Lender may purchase
insurance at Borrower’s expense to protect Lender’s interests in the collateral. This insurance may, but need not,
protect Borrower’s interests. The coverage that Lender purchases may not pay any claim that Borrower makes or any claim
that is made against Borrower in connection with the collateral. Borrower may later cancel any insurance purchased by Lender,
but only after providing Lender with evidence that Borrower has obtained insurance as required by their agreement. if Lender purchases
insurance for the collateral. Borrower will be responsible for the costs of that insurance, including interest and any other charges
Lender may impose in connection with the placement of the insurance, until the effective date of the cancellation or expiration
of the insurance. The costs of the insurance may be added to Borrower’s total outstanding balance or obligation. The costs
of the insurance may be more than the cost of insurance Borrower may be able to obtain on Borrower’s own.

 

PRIOR TO SIGNING THIS NOTE, BORROWER READ
AND UNDERSTOOD ALL THE PROVISIONS OF THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. BORROWER AGREES TO THE TERMS
OF THE NOTE.

 

BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED
COPY OF THIS PROMISSORY NOTE.

 

BORROWER:

 

	BISCO INDUSTRIES, INC.	 
	 	 	 
	By:	/s/ GLEN F. CEILEY	 
	 	GLEN F. CEILEY, Chairman/CEO of BISCO INDUSTRIES, INC.	 

 

Laser Pro, Ver 16.1.0.035 Copr D+H USA Corporation 1997, 2016. All Rights Reserved - CA c:\CF150\CFI\LPL\C40
FC TR-27005 PR-38Exhibit 10.5

 

 

 

COMMERCIAL GUARANTY

 

	Principal	Loan Date	Maturity	Loan No	Call / Coll	Account	Officer	Initials
	 	 	 	 	CLS 07 / 240	 	765	 
	
        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.	Lender:	community
    bank
	 	1500 NORTH LAKEVIEW
    AVENUE		ANAHEIM BRANCH
	 	ANAHEIM, CA 92807		1750
    S. STATE COLLEGE BLVD.

    ANAHEIM, CA 92806

    (800) 788-9999
	Guarantor:	EACO CORPORATION
    

    1500 N. LAKEVIEW AVENUE

    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 lender 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 (he 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 (EACO Corporation).
Borrower shall furnish to Lender as soon as available, but in no event later than one hundred twenty (120) days after the end
of each fiscal year end, EACO Corporation’s consolidated financial statement for the year ended, 10-K audited by a Certified Public
Accountant satisfactory to Lender and company prepared financial statements to reconcile with the net worth of the prior financial
statements on a consolidating basis within one hundred twenty (120) days of fiscal year end..

 

Interim Statements (EACO Corporation).
Borrower shall furnish to Lender as soon as available, but in no event later than forty five (45) days after the end of each quarter,
EACO Corporation’s 10-Q consolidated financial statement for the period ended, prepared by Certified Public Accountant in form
satisfactory to Lender and company prepared financial statements to reconcile with the net worth of the prior financial statements
on a consolidating basis within forty five (45) days of quarter end.

 

Tax Returns (EACO Corporation).
Borrower shall furnish to Lender as soon as available and in any event within thirty (30) days after filing, Corporate Guarantor’s
federal income tax returns and supporting schedules, prepared by a tax professional satisfactory to Lender.

 

Debt to Effective Tangible
Net Worth Ratio (EACO Corporation). EACO Corporation shall maintain a maximum Debt to Effective Tangible Net Worth Ratio of
3.25 to 1.00 to be measured at the end of each fiscal quarter. The term “Debt to Effective Tangible Net Worth”
means EACO Corporation’s total liabilities, less amounts subordinated to Lender, as evidenced by a subordination agreement, if
any divided by EACO Corporation’s Effective Tangible Net Worth. The term “Effective Tangible Net Worth” means
EACO Corporation’s total assets, less intangibles [i.e. goodwill, trademarks, patents, copyrights, organizational expenses, and
similar intangible items, but including leaseholds and leasehold improvements], less amounts due from officers, partners, stockholders,
directors, affiliates, and subsidiaries, less total liabilities, plus amounts subordinated to Lender, as evidenced by a subordination
agreement, if any. The first measurement will be as of May 31, 2015.

 

Debt Service Coverage Ratio
(EACO Corporation). EACO Corporation shall maintain a Debt Service Coverage Ratio of not less than 1.25 to 1.00, to
be measured at the end of each fiscal year. “Debt Service Coverage Ratio” is defined as net income plus depreciation
expense, amortization expense and any other non-cash expense less cash distributions, cash withdrawals, cash dividends and any
non-cash income all divided by the sum of current maturities of long-term debt and current maturities of capital lease obligations,
which sum shall not be less than $1. The first measurement will be as of August 31, 2015.

 

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.

 

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 limitalion, 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.

 

     

     

    

  

	 	COMMERCIAL GUARANTY	 
	Loan No: 155354101	(Continued)	Page 3

 

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. (O)
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.

 

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.

 

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.

 

     

     

    

  

	 	COMMERCIAL GUARANTY	 
	Loan No: 155354101	(Continued)	Page 4

 

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.

 

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.

 

NATURE OF GUARANTY. Guarantor’s
liability under this Guaranty shall be open and continuous for so long as this Guaranty remains in force. Guarantor intends to
guarantee at all times the performance and prompt payment when due, whether at maturity or earlier by reason of acceleration or
otherwise, of all indebtedness. Accordingly, no payments made upon the indebtedness will discharge or diminish the continuing liability
of Guarantor in connection with any remaining portions of the indebtedness or any of the indebtedness which subsequently arises
or is thereafter incurred or contracted.

 

PRIOR COMMERCIAL GUARANTY.
This Commercial Guaranty hereby amends and restates any prior Commercial Guaranty along with all modification(s) and amendment(s)
thereto executed by Guarantor.

 

COUNTERPARTS. This agreement,
document or instrument 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 taken together shall constitute one and the
same agreement, document or instrument. Delivery by facsimile or by electronic transmission in portable document format (PDF) of
an executed counterpart of this agreement, document or instrument is as effective as delivery of an originally executed counterpart
of this agreement, document or instrument.

 

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
COMMUNITY BANK, its successors and assigns.

 

NOTE. The word “Note”
means 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.

 

     

     

    

 

	 	COMMERCIAL GUARANTY	 
	Loan No: 155354101	(Continued)	Page 5

 

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 MARCH 16, 2015.

 

	GUARANTOR:	 
	 	 
	EACO CORPORATION	 
	 	 
	By:	/s/
    GLEN F. CEILEY	 
		GLEN F. CEILEY, CEO/CFO/Secretary of EACO
    CORPORATION	 

 

 

 

 CERTIFICATE OF ACKNOWLEDGMENT

 

A notary public or other officer completing this certificate
verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness,
accuracy or validity of that document.

 

	STATE OF 	California	 	)
	 			) SS
	COUNTY OF	Orange	 	)

 

	On
    March 26, 2015 before
    me,	Courtney Cresap, Notary Public	,
	 	(here
    insert name and title of the officer)	 

personally appeared GLEN F. CEILEY,
who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person,
or the entity upon behalf of which the person acted, executed the instrument.

 

I certify under PENALTY OF PERJURY
under the laws of the State of California that the foregoing paragraph is true and correct.

 

	WITNESS my hand and official seal.	 
	 	 	 
	Signature		(Seal)

  

 

LaserPro, Var 14.5.10.004 Copr D+H USA Corporation
1997, 2015. All Rights Reserved - CA G:\CFJ50\CFl\LPL\E20 FC TR-23274 PR-38

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