Document:

EX-10.13

   

Exhibit 10.13
  

 GigCapital3, Inc.

1731 Embarcadero Rd., Suite 200 

Palo Alto, CA 94303

 

April 16, 2020

 

GigAcquisitions3, LLC

1731 Embarcadero Rd., Suite 200

Palo Alto, CA 94303

 

RE: Amended and Restated Subscription Agreement for Founder
Shares
  

Ladies and Gentlemen:

 

We are pleased to accept the offer GigAcquisitions3, LLC, a Delaware limited
liability company (the “Subscriber” or “you”), has made to purchase 5,735,000 shares (“Founder Shares”) of the common stock, $.0001 par value per share (“Common
Stock”), of GigCapital3, Inc., a Delaware corporation (the “Company”), up to 750,000 Founder Shares of which are subject to complete or partial forfeiture by you if the underwriters of the initial public offering
(“IPO”) of the Company pursuant to the registration statement on Form S-1 (the “Registration Statement”) do not fully exercise their over-allotment option (the “Over-allotment
Option”). The terms (this “Agreement”) on which the Company is willing to sell the Founder Shares to the Subscriber, and the Company and the Subscriber’s agreements regarding such Founder Shares, are as
follows:
  

1. Purchase of Founder Shares. For the sum of $25,000.00 (the “Purchase
Price”), which the Company acknowledges receiving in cash, the Company hereby sells and issues the Founder Shares to the Subscriber, and the Subscriber hereby purchases the Founder Shares from the Company, subject to the forfeiture
provisions of Section 3 below, on the terms and subject to the conditions set forth in this Agreement. Concurrently with the Subscriber’s execution of this Agreement, the Company is delivering to the Subscriber a certificate registered in
the Subscriber’s name representing the Founder Shares (the “Original Certificate”), receipt of which the Subscriber hereby acknowledges.

 

2. Representations, Warranties and Agreements.

 

2.1. Subscriber’s Representations, Warranties and Agreements.
To induce the Company to issue the Founder Shares to the Subscriber, the Subscriber hereby represents and warrants to the Company and agrees with the Company as follows:

 

2.1.1. No Government Recommendation or Approval. The Subscriber
understands that no federal or state agency has passed upon or made any recommendation or endorsement of the offering of the Founder Shares.

 

2.1.2. No Conflicts. The execution, delivery and performance of
this Agreement and the consummation by the Subscriber of the transactions contemplated hereby do not violate, conflict with or constitute a default under (i) the formation and governing documents of the Subscriber, (ii) any agreement,
indenture or instrument to which the Subscriber is a party, (iii) any law, statute, rule or regulation to which the Subscriber is subject, or (iv) any agreement, order, judgment or decree to which the Subscriber is subject, except in the
case of clauses (i) through (iv) that would not reasonably be expected to have a material adverse effect on the Subscriber.

 

2.1.3. Organization and Authority. The Subscriber is a Delaware
limited liability company, validly existing and in good standing under the laws of Delaware and possesses all requisite power and authority necessary to carry out the transactions contemplated by this Agreement. Upon execution and delivery by you,
this Agreement will be a legal, valid and binding agreement of Subscriber, enforceable against Subscriber in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, fraudulent conveyance or
similar laws affecting the enforcement of creditors’ rights generally and subject to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).

 

 

 

 

 

2.1.4. Experience, Financial Capability and Suitability.
Subscriber is: (i) sophisticated in financial matters and is able to evaluate the risks and benefits of the investment in the Founder Shares and (ii) able to bear the economic risk of its investment in the Founder Shares for an indefinite
period of time because the Founder Shares have not been registered under the Securities Act (as defined below) and therefore cannot be resold unless subsequently registered under the Securities Act or an exemption from such registration is
available. Subscriber is capable of evaluating the merits and risks of its investment in the Company and has the capacity to protect its own interests. Subscriber must bear the economic risk of this investment until the Founder Shares are sold
pursuant to: (x) an effective registration statement under the Securities Act or (y) an exemption from registration available with respect to such sale. Subscriber is able to bear the economic risks of an investment in the Founder Shares
and to afford a complete loss of Subscriber’s investment in the Founder Shares.
  

2.1.5. Access to Information; Independent Investigation. Prior to
the execution of this Agreement, the Subscriber has had the opportunity to ask questions of and receive answers from representatives of the Company concerning an investment in the Company, as well as the finances, operations, business and prospects
of the Company, and the opportunity to obtain additional information to verify the accuracy of all information so obtained. In determining whether to make this investment, Subscriber has relied solely on Subscriber’s own knowledge and
understanding of the Company and its business based upon Subscriber’s own due diligence investigation and the information furnished pursuant to this paragraph. Subscriber understands that no person has been authorized to give any information
or to make any representations which were not furnished pursuant to this Section 2 and Subscriber has not relied on any other representations or information in making its investment decision, whether written or oral, relating to the Company,
its operations or its prospects.
  

2.1.6. Regulation D Offering. Subscriber represents that it is an
“accredited investor” as such term is defined in Rule 501(a) of Regulation D under the Securities Act of 1933, as amended (the “Securities Act”), and acknowledges the sale contemplated hereby is being made in reliance
on a private placement exemption applicable to “accredited investors” or similar exemptions under federal and state law.

 

2.1.7. Investment Purposes. The Subscriber is purchasing the
Founder Shares solely for investment purposes, for the Subscriber’s own account and not for the account or benefit of any other person, and not with a view towards the distribution or dissemination thereof. The Subscriber did not enter into
this Agreement as a result of any general solicitation or general advertising within the meaning of Rule 502 of Regulation D under the Securities Act.

 

2.1.8. Restrictions on Transfer; Shell Company. Subscriber
understands the Founder Shares are being offered in a transaction not involving a public offering within the meaning of the Securities Act. Subscriber understands the Founder Shares will be “restricted securities” as defined in Rule
144(a)(3) under the Securities Act and Subscriber understands that the certificate representing the Founder Shares will contain a legend in respect of such restrictions. If in the future the Subscriber decides to offer, resell, pledge or otherwise
transfer the Founder Shares, such Founder Shares may be offered, resold, pledged or otherwise transferred only in accordance with the provisions of Section 5.1 hereof. Subscriber agrees that if any transfer of its Founder Shares or any interest
therein is proposed to be made, as a condition precedent to any such transfer, Subscriber may be required to deliver to the Company an opinion of counsel satisfactory to the Company. Absent registration or an exemption, the Subscriber agrees not to
resell the Founder Shares. Subscriber further acknowledges that because the Company is a shell company, Rule 144 may not be available to the Subscriber for the resale of the Founder Shares until at least one year following consummation of the
initial business combination of the Company, despite technical compliance with the certain requirements of Rule 144 and the release or waiver of any contractual transfer restrictions.

 

2.1.9. No Governmental Consents. No governmental, administrative
or other third-party consents or approvals are required, necessary or appropriate on the part of Subscriber in connection with the transactions contemplated by this Agreement.

 

2.2. Company’s Representations, Warranties and Agreements. To
induce the Subscriber to purchase the Founder Shares, the Company hereby represents and warrants to the Subscriber and agrees with the Subscriber as follows:

 

 

 

 

 

2.2.1. Organization and Corporate Power. The Company is a Delaware
corporation, validly existing and in good standing under the laws of Delaware, and is qualified to do business in every jurisdiction in which the failure to so qualify would reasonably be expected to have a material adverse effect on the financial
condition, operating results or assets of the Company. The Company possesses all requisite corporate power and authority necessary to carry out the transactions contemplated by this Agreement. Upon execution and delivery by the Company, this
Agreement will be a legal, valid and binding agreement of the Company, enforceable against the Company in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, fraudulent conveyance or similar
laws affecting the enforcement of creditors’ rights generally and subject to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).

 

2.2.2. No Conflicts. The execution, delivery and performance of
this Agreement and the consummation by the Company of the transactions contemplated hereby do not violate, conflict with or constitute a default under (i) the Certificate of Incorporation or Bylaws of the Company, (ii) any agreement,
indenture or instrument to which the Company is a party, (iii) any law, statute, rule or regulation to which the Company is subject, or (iv) any agreement, order, judgment or decree to which the Company is subject.

 

2.2.3. Title to Securities. Upon issuance in accordance with, and
payment pursuant to, the terms hereof, the Founder Shares will be duly and validly issued, fully paid and nonassessable. Upon issuance in accordance with, and payment pursuant to, the terms hereof the Subscriber will have or receive good title to
the Founder Shares, free and clear of all liens, claims and encumbrances of any kind, other than (a) transfer restrictions hereunder and other agreements to which the Founder Shares may be subject which have been notified to the Subscriber in
writing, (b) transfer restrictions under federal and state securities laws, and (c) liens, claims or encumbrances imposed due to the actions of the Subscriber.

 

2.2.4. No Adverse Actions. There are no actions, suits,
investigations or proceedings pending, threatened against or affecting the Company which: (i) seek to restrain, enjoin, prevent the consummation of or otherwise affect the transactions contemplated by this Agreement or (ii) question the
validity or legality of any transactions or seek to recover damages or to obtain other relief in connection with any transactions.

 

3. Forfeiture of Founder Shares.

 

3.1. Partial or No Exercise of the Over-allotment Option. In the
event the Over-allotment Option granted to the representative of the underwriters of the IPO is not exercised in full, the Subscriber acknowledges and agrees that it shall forfeit any and all rights to such number of Founder Shares (up to an
aggregate of 310,190 Founder Shares and pro rata based upon the percentage of the Over-allotment Option exercised) such that immediately following such forfeiture, the Subscriber (and all other initial stockholders prior to the IPO plus the
holders of any shares of Common Stock to be issued to service providers to the Company by the time that is immediately following the IPO) will own an aggregate number of Founder Shares (not including shares of Common Stock issuable upon exercise of
any warrants or any Common Stock purchased by Subscriber in the IPO or in the aftermarket, any shares of Common Stock underlying units to be issued in a private placement at the time of the IPO or any shares of Common Stock to be issued to the
underwriters at the time of the IPO) equal to 20% of the issued and outstanding Common Stock of the Company immediately following the IPO.

 

3.2. Termination of Rights as Stockholder. If any of the Founder
Shares are forfeited in accordance with this Section 3, then after such time the Subscriber (or successor in interest), shall no longer have any rights as a holder of such Founder Shares, and the Company shall take such action as is appropriate
to cancel such Founder Shares.
  

3.3. Share Certificates. In the event an adjustment to the Original
Certificate is required pursuant to this Section 3, then the Subscriber shall return such Original Certificate to the Company or its designated agent as soon as practicable upon its receipt of notice from the Company advising Subscriber of such
adjustment, following which a new certificate (the “New Certificate”) shall be issued in such amount representing the adjusted number of Founder Shares held by the Subscriber. The New Certificate shall be returned to the
Subscriber as soon as practicable.
  

 

 

 

 

4. Waiver of Liquidation Distributions; Redemption Rights. In connection with the
Founder Shares purchased pursuant to this Agreement, the Subscriber hereby waives any and all right, title, interest or claim of any kind in or to any distributions by the Company from the trust account which will be established for the benefit of
the Company’s public stockholders and into which substantially all of the proceeds of the IPO will be deposited (the “Trust Account”), in the event of a liquidation of the Company upon the Company’s failure to timely
complete an initial business combination. For purposes of clarity, in the event the Subscriber purchases Common Stock in the IPO or in the aftermarket, any additional Common Stock so purchased shall be eligible to receive any liquidating
distributions by the Company. However, in no event will the Subscriber have the right to redeem any shares of Common Stock into funds held in the Trust Account upon the successful completion of an initial business combination.

 

5. Restrictions on Transfer.

 

5.1. Securities Law Restrictions. In addition to any restrictions
to be contained in that certain letter agreement (commonly known as an “Insider Letter”) to be dated as of the closing of the IPO by and between Subscriber and the Company, Subscriber agrees not to sell, transfer, pledge,
hypothecate or otherwise dispose of all or any part of the Founder Shares unless, prior thereto (a) a registration statement on the appropriate form under the Securities Act and applicable state securities laws with respect to the Founder
Shares proposed to be transferred shall then be effective or (b) the Company has received an opinion from counsel reasonably satisfactory to the Company, that such registration is not required because such transaction is exempt from
registration under the Securities Act and the rules promulgated by the Securities and Exchange Commission thereunder and with all applicable state securities laws.

 

5.2. Lock-up. Subscriber acknowledges that the Founder Shares will
be subject to lock-up provisions (the “Lock-up”) contained in the Insider Letter. Pursuant to the Insider Letter, Subscriber will agree not to sell, transfer, pledge, hypothecate or otherwise dispose of all or any part
of the Founder Shares until the earlier to occur of: (A) twelve months after the completion of the Company’s initial business combination or (B) subsequent to the the Company’s initial business combination, (1) the date on
which the last sale price of the Common Stock equals or exceeds $12.50 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period
commencing at least 90 days after the Company’s initial business combination, or (2) the date on which the Company consummates a liquidation, merger, stock exchange or other similar transaction after its initial business combination that
results in all of its stockholders having the right to exchange their shares of common stock for cash, securities or other property.

 

5.3. Restrictive Legends. All certificates representing the Founder
Shares shall have endorsed thereon legends substantially as follows:

 

“THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND NEITHER THE SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT OR
SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND SUCH LAWS WHICH, IN THE OPINION OF COUNSEL, IS AVAILABLE.”
  
 “THE
SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO LOCKUP PROVISIONS AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED DURING THE TERM OF THE LOCKUP PERIOD.”

 

5.4. Additional Founder Shares or Substituted Securities. In the event of the
declaration of a stock dividend, the declaration of a special dividend payable in a form other than Common Stock, a spin-off, a stock split, an adjustment in conversion ratio, a recapitalization or a similar transaction affecting the
Company’s outstanding Common Stock without receipt of consideration, any new, substituted or additional securities or other property which are by reason of such transaction distributed with respect to any Founder Shares subject to this
Section 5 or into which such Founder Shares thereby become convertible shall immediately be subject to this Section 5 and Section 3. Appropriate adjustments to reflect the distribution of such securities or property shall be made to
the number or class of Founder Shares subject to this Section 5 and Section 3.

 

 

 

 

  

5.5. Registration Rights. Subscriber acknowledges that the Founder Shares are being
purchased pursuant to an exemption from the registration requirements of the Securities Act and will become freely tradable only after certain conditions are met or they are registered pursuant to a registration rights agreement to be entered into
with the Company prior to the closing of the IPO.
  

6. Other Agreements.

 

6.1. Further Assurances. Subscriber agrees to execute such further
instruments and to take such further action as may reasonably be necessary to carry out the intent of this Agreement.
  

6.2. Notices. All notices, statements or other documents which are
required or contemplated by this Agreement shall be in writing and delivered: (i) personally or sent by first class registered or certified mail, overnight courier service or facsimile or electronic transmission to the address designated in
writing, (ii) by facsimile to the number most recently provided to such party or such other address or fax number as may be designated in writing by such party and (iii) by electronic mail, to the electronic mail address most recently
provided to such party or such other electronic mail address as may be designated in writing by such party. Any notice or other communication so transmitted shall be deemed to have been given on the day of delivery, if delivered personally, on the
business day following receipt of written confirmation, if sent by facsimile or electronic transmission, one (1) business day after delivery to an overnight courier service or five (5) days after mailing if sent by mail.

 

6.3. Entire Agreement. This Agreement, together with that certain
Insider Letter to be entered into between Subscriber and the Company, substantially in the form to be filed as an exhibit to the Registration Statement, embodies the entire agreement and understanding between the Subscriber and the Company with
respect to the subject matter hereof and supersedes all prior oral or written agreements and understandings relating to the subject matter hereof. No statement, representation, warranty, covenant or agreement of any kind not expressly set forth in
this Agreement shall affect, or be used to interpret, change or restrict, the express terms and provisions of this Agreement.

 

6.4. Modifications and Amendments. The terms and provisions of this
Agreement may be modified or amended only by written agreement executed by all parties hereto.
  

6.5. Waivers and Consents. The terms and provisions of this
Agreement may be waived, or consent for the departure therefrom granted, only by written document executed by the party entitled to the benefits of such terms or provisions. No such waiver or consent shall be deemed to be or shall constitute a
waiver or consent with respect to any other terms or provisions of this Agreement, whether or not similar. Each such waiver or consent shall be effective only in the specific instance and for the purpose for which it was given, and shall not
constitute a continuing waiver or consent.
  

6.6. Assignment. The rights and obligations under this Agreement
may not be assigned by either party hereto without the prior written consent of the other party.
  

6.7. Benefit. All statements, representations, warranties,
covenants and agreements in this Agreement shall be binding on the parties hereto and shall inure to the benefit of the respective successors and permitted assigns of each party hereto. Nothing in this Agreement shall be construed to create any
rights or obligations except among the parties hereto, and no person or entity shall be regarded as a third-party beneficiary of this Agreement.

 

6.8. Governing Law, Waiver of Jury Trial. This Agreement and the
rights and obligations of the parties hereunder shall be construed in accordance with and governed by the laws of New York applicable to contracts wholly performed within the borders of such state, without giving effect to the conflict of law
principles thereof. The Company (on its behalf and, to the extent permitted by applicable law, on behalf of its stockholders and affiliates) and the Subscriber hereby irrevocably waive, to the fullest extent permitted by applicable law, any and all
right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.

 

 

 

 

 

6.9. Severability. In the event that any court of competent
jurisdiction shall determine that any provision, or any portion thereof, contained in this Agreement shall be unreasonable or unenforceable in any respect, then such provision shall be deemed limited to the extent that such court deems it reasonable
and enforceable, and as so limited shall remain in full force and effect. In the event that such court shall deem any such provision, or portion thereof, wholly unenforceable, the remaining provisions of this Agreement shall nevertheless remain in
full force and effect.
  

6.10. No Waiver of Rights, Powers and Remedies. No failure or delay
by a party hereto in exercising any right, power or remedy under this Agreement, and no course of dealing between the parties hereto, shall operate as a waiver of any such right, power or remedy of such party. No single or partial exercise of any
right, power or remedy under this Agreement by a party hereto, nor any abandonment or discontinuance of steps to enforce any such right, power or remedy, shall preclude such party from any other or further exercise thereof or the exercise of any
other right, power or remedy hereunder. The election of any remedy by a party hereto shall not constitute a waiver of the right of such party to pursue other available remedies. No notice to or demand on a party not expressly required under this
Agreement shall entitle the party receiving such notice or demand to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of the party giving such notice or demand to any other or further
action in any circumstances without such notice or demand.

 

6.11. Survival of Representations and Warranties. All
representations and warranties made by the parties hereto in this Agreement or in any other agreement, certificate or instrument provided for or contemplated hereby, shall survive the execution and delivery hereof and any investigations made by or
on behalf of the parties.
  

6.12. No Broker or Finder. Each of the parties hereto represents
and warrants to the other that no broker, finder or other financial consultant has acted on its behalf in connection with this Agreement or the transactions contemplated hereby in such a way as to create any liability on the other. Each of the
parties hereto agrees to indemnify and hold the other harmless from any claim or demand for commission or other compensation by any broker, finder, financial consultant or similar agent claiming to have been employed by or on behalf of such party
and to bear the cost of legal expenses incurred in defending against any such claim.
  

6.13. Headings and Captions. The headings and captions of the
various sections of this Agreement are for convenience of reference only and shall in no way modify or affect the meaning or construction of any of the terms or provisions hereof.

 

6.14. Counterparts. This Agreement may be executed in one or more
counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party, it being understood that both parties need
not sign the same counterpart. In the event that any signature is delivered by facsimile transmission or any other form of electronic delivery, such signature shall create a valid and binding obligation of the party executing (or on whose behalf
such signature is executed) with the same force and effect as if such signature page were an original thereof.
  

6.15. Construction. The words “include,”
“includes,” and “including” will be deemed to be followed by “without limitation.” Pronouns in masculine, feminine, and neuter genders will be construed to include any other gender, and words in the singular form
will be construed to include the plural and vice versa, unless the context otherwise requires. The words “this Agreement,” “herein,” “hereof,” “hereby,” “hereunder,” and words of similar
import refer to this Agreement as a whole and not to any particular section unless expressly so limited. The parties hereto intend that each representation, warranty, and covenant contained herein will have independent significance. If any party
hereto has breached any representation, warranty, or covenant contained herein in any respect, the fact that there exists another representation, warranty or covenant relating to the same subject matter (regardless of the relative levels of
specificity) which such party hereto has not breached will not detract from or mitigate the fact that such party hereto is in breach of the first representation, warranty, or covenant.

 

6.16. Mutual Drafting. This Agreement is the joint product of the
Subscriber and the Company and each provision hereof has been subject to the mutual consultation, negotiation and agreement of such parties and shall not be construed for or against any party hereto.

 

 

 

 

 

7. Voting and Redemption of Founder Shares. Subscriber agrees to vote the Founder Shares
in favor of an initial business combination that the Company negotiates and submits for approval to the Company’s stockholders and shall not seek redemption with respect to such Founder Shares. Additionally, the Subscriber agrees not to redeem
any Founder Shares in connection with a redemption or tender offer presented to the Company’s stockholders in connection with an initial business combination negotiated by the Company.

 

8. Indemnification. Each party shall indemnify the other against any loss, cost or
damages (including reasonable and documented attorneys’ fees and expenses) incurred as a result of such party’s breach of any representation, warranty, covenant or agreement in this Agreement.

 

[Signature Page Follows]

 
 

 

 

 

If the foregoing accurately sets forth our understanding and agreement, please
sign the enclosed copy of this Agreement and return it to us.

	 	 	 
	 	 	Very truly yours,
	 	 	 
	 	 	GIGCAPITAL3, INC.
	 	 	 
	 	 	/s/ Dr. Avi S. Katz
	 	 	Dr. Avi S. Katz, Chairman of the Board and Chief Executive Officer

	 	 	 
	Accepted and agreed this 16th day of April, 2020.	 	 
	 	 	 
	GIGACQUISITIONS3, LLC	 	 
	 	 	 
	/s/ Dr. Avi S. Katz.
	 	 
	Dr. Avi S. Katz, Sole Manager	 	 

  

Signature page to Amended and Restated Subscription Agreement –
GigAcquisitions3, LLCExhibit 10.1

 

Paycheck Protection Program

Promissory Note

 

	Borrower  Applied Optoelectronics, Inc.	Date   April 17, 2020
	Borrower’s Address 13139 Jess Pirtle Blvd. Sugar Land, TX 77478
	
        Loan Amount Six Million, Two Hundred and Twenty
        Eight Thousand, Eight Hundred and Ninety Five Dollars and zero Cents

        Dollars $6,228,895.00

 

 

For value received,
the borrower(s) named above (whether one or more “Borrower”), jointly and severally promise to pay to the order of
Truist Bank, a North Carolina banking corporation (“Bank”) at any of its offices, or at such place as Bank may in writing
designate, without offset in U.S. Dollars and in immediately available funds, the Loan Amount shown above, or the total of all
amounts advanced under this promissory note and any modifications, renewals, extensions or replacements thereof (this “Note”)
if less than the full Loan Amount is advanced, plus interest and any other amounts due, upon the terms specified below. As used
in this Note, the term “Bank Party” shall mean and include Bank and any current and future subsidiaries and affiliates
of Bank and each of their respective successors and assigns.

 

Payment Terms

A fixed payment schedule,
commencing on the date that is seven (7) months from the date the loan evidenced by this Note is funded, consisting of seventeen
(17) consecutive monthly payments of principal and interest, with the principal component of each such payment based upon the
level amortization of principal over a two year period from the date the loan evidenced by this Note is funded and with each payment
payable on the 17th day of each month, beginning November 2020, and a final payment equal to the balance of unpaid principal plus
accrued and unpaid interest and any other amounts owed hereunder due and payable on the later of April 17th, 2022 or the date
that is twenty four (24) months from the date the loan evidenced by this Note is funded (the “maturity date”), provided,
however, that prior to applying payments in accordance with the foregoing payment structure, all payments shall first be applied
to any accrued but unpaid interest including, without limitation, any deferred but unpaid interest.

 

Interest

The obligations under
this Note will bear interest at a rate of 1.00% per annum (the “Rate”) from the date the loan hereunder (the “Loan”)
is funded until the date that the Loan, together with all accrued and unpaid interest and any applicable fees or charges due under
this Note, is paid in full. Interest shall accrue daily and will be calculated based on an actual/360 basis (on the actual number
of days elapsed over a year of 360 days). Notwithstanding the forgoing, payment of interest is deferred for the first six months
of this Loan.

 

Borrower Paycheck
Protection Program Certifications

Borrower hereby certifies,
represents, warrants and covenants to Bank as follows:

(a)        Borrower
has read the statements included in the application related to this Loan (the “Application”), including the Statements
Required by Law and Executive Orders, and Borrower understands them.

(b)       Borrower
was and remains eligible to receive a loan under the rules in effect at the time the Application was submitted that have been
issued by the Small Business Administration (“SBA”) implementing the Paycheck Protection Program under Division A,
Title I of the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) (the “Paycheck Protection
Program Rule”).

(c)        Borrower
(i) is an independent contractor, eligible self-employed individual, or sole proprietor or (ii) (A) employs no more than the greater
of 500 employees or, if applicable, the size standard in number of employees established by the SBA in 13 C.F.R. 121.201 for Borrower’s
industry and (B) is a small business concern as defined in section 3 of the Small Business Act (15 USC 632) (and subject to SBA’s
affiliation rules under 13 CFR 121.301(f) unless specifically waived in the Act), a tax-exempt nonprofit organization described
in section 501(c)(3) of the IRC, a tax-exempt veterans organization described in section 501(c)(19) of the IRC, a Tribal business
concern described in section 31(b)(2)(C) of the Small Business Act.

 

 

 

    	 	1	 

     

    

 

(d)        Borrower
will, and will ensure that each Owner complies, whenever applicable, with the civil rights and other limitations in the Application
(as used herein the term “Owner” shall have the same definition as in the Application and the Paycheck Protection
Program Rule).

(e)        All
proceeds of the Loan will be used only for business-related purposes as specified in the Application and consistent with the Paycheck
Protection Program Rule.

(f)       
To the extent feasible, Borrower will purchase only American-made equipment and products.

(g)       Borrower
is not engaged in any activity that is illegal under federal, state or local law.

(h)       Borrower
certifies that any loan received by Borrower under Section 7(b)(2) of the Small Business Act between January 31, 2020 and the
date hereof was for a purpose other than paying payroll costs and other allowable uses for loans under the Paycheck Protection
Program Rule.

(i)         Borrower
was in operation on February 15, 2020 and had employees for whom Borrower paid salaries and payroll taxes or paid independent
contractors (as reported on Form(s) 1099-MISC) and has provided Bank true, correct and complete information demonstrating that
Borrower had employees for whom Borrower paid salaries and payroll taxes.

(j)
        The current economic uncertainty makes the request for the Loan necessary
to support the ongoing operations of Borrower.

(k)        All
proceeds of the Loan will be used to retain workers and maintain payroll or make mortgage interest payments, lease payments, and
utility payments, as specified under the Paycheck Protection Program Rule and Borrower acknowledges that if the funds are knowingly
used for unauthorized purposes, the federal government may hold Borrower and/or Borrower’s authorized representative legally
liable, such as for charges of fraud.

(l)         Borrower
has provided to Bank all documentation available to Borrower on a reasonable basis verifying the dollar amounts of average monthly
payroll costs for the relevant period, which documentation shall include, as applicable, copies of payroll processor records,
payroll tax filings and/or Form 1099-MISC.

(m)
      Borrower will promptly provide to Bank (i) any additional
documentation that Bank requests in order to verify payroll costs and (ii) documentation verifying the number of full-time
equivalent employees on payroll as well as the dollar amounts of payroll costs, covered mortgage interest payments, covered rent
payments, and covered utilities for the eight week period following the Loan.

(n)       Borrower
acknowledges that (a) loan forgiveness will be provided by the SBA for the sum of documented payroll costs, covered mortgage interest
payments, covered rent payments, and covered utilities, and not more than 25% of the Forgivable Amount may be for non-payroll
costs and (b) the forgiveness amount is subject to reduction based on employee headcount and compensation reductions during the
8-week loan period as compared to the prior periods in accordance with the CARES Act.

(o)       Borrower
does not have any other application pending for a loan under the Paycheck Protection Program, or any other federal program that
would invalidate its participation in the Paycheck Protection Program.

(p)       During
the period beginning on February 15, 2020 and ending on December 31, 2020, Borrower has not and will not receive any other loan
under the Paycheck Protection Program.

(q)       Borrower
has reviewed the SBA’s affiliation rules and standards, including the application of such affiliation standards to eligibility
requirements for the Paycheck Protection Program, and, after due and careful consideration, represents and warrants that Borrower
satisfies all requirements for eligibility for the Paycheck Protection Program.

(r)        Borrower
certifies that the information provided in the Application and the information that Borrower provided in all supporting documents
and forms is true and accurate in all material respects. Borrower acknowledges that knowingly making a false statement to obtain
a guaranteed loan from SBA is punishable under the law, including under 18 USC 1001 and 3571 by imprisonment of not more than
five years and/or a fine of up to $250,000; under 15 USC 645 by imprisonment of not more than two years and/or a fine of not more
than $5,000; and, if submitted to a Federally insured institution, under 18 USC 1014 by imprisonment of not more than thirty years
and/or a fine of not more than $1,000,000.

(s)        Borrower
acknowledges that it has calculated the eligible Loan amount using the supporting documents which it has submitted to Bank. Borrower
further acknowledges that execution of this Note constitutes Borrower’s certification that it is in agreement with the Principal
Amount of the Loan as set forth herein and that such Principal Amount
is not in excess of the maximum principal amount permitted in accordance with the CARES Act.

(t)        Borrower
understands, acknowledges and agrees that Bank can share any tax information received from Borrower or any Owner with SBA's authorized
representatives, including authorized representatives of the SBA Office of Inspector General, for the purpose of compliance with
SBA Loan Program Requirements and all SBA reviews.

 

 

 

 

    	 	2	 

     

    

 

Loan Purpose and Updated Financial
Information Required

Borrower represents and warrants that
the loan evidenced by this Note is being made solely for the permitted use of proceeds specified in the CARES Act and related
regulations, rules and guidance. In addition, Borrower represents, warrants and covenants that no part of the proceeds of the
loan evidenced by this Note will be used directly or indirectly (a) to fund or finance any operations, investments or activities
in or make any payments to a (1) Person that is, or is owned or controlled by, Persons that are the subject of any Sanctions (as
defined below) (each a “Sanctioned Person”) or (2) country or territory that is the subject of Sanctions, or is owned
or controlled by one or more Sanctioned Person (a “Sanctioned Country”), or in any other manner that would result
in a violation of any Sanctions by any Person, or (b) in furtherance of an offer, payment, promise to pay, or authorization of
the payment or giving of money, or anything else of value, to any Person in violation of any laws, rules or regulations of any
jurisdiction concerning or relating to bribery or corruption. Borrower further represents, warrants and covenants that while the
loan evidenced by this Note remains outstanding, each Obligor, each subsidiary or affiliate of each Obligor, and their respective
directors, officers, employees, or agents will not (a) be or become a Sanctioned Person, (b) allow any of their assets to be located
in a Sanctioned Country, or (c) derive any of their operating income from investments in, or transactions with, one or more Sanctioned
Person or Sanctioned Country. As used herein, “Sanctions” means any trade, economic or financial sanctions administered
or enforced by the Office of Foreign Assets Control, the U.S. Department of State, the United Nations Security Council, the EU,
Her Majesty’s Treasury or other relevant sanctions authority. As used in this Note, the term “Person” shall
mean any individual, partnership, firm, corporation, association, joint venture, limited liability company, trust or other entity,
or any governmental authority or governmental agency. As used in this Note the term “Obligor” shall individually and
collectively refer to Borrower and any other Person that is or hereafter becomes primarily or secondarily liable for the payment
of the loan evidenced by this Note and any Person that has conveyed or may hereafter convey any security interest or lien to Bank
in any real or personal property to secure payment of this Note. Borrower agrees to promptly provide to Bank updated financial
information, including, but not limited to, tax returns, current financial statements in form satisfactory to Bank, as well as
additional information, reports or schedules (financial or otherwise), all as Bank may from time to time request.

 

Representations and Warranties

The Borrower is one of the following:
(a) an individual above the age of majority and has the legal capacity to execute this Note, (b) a corporation, limited liability
company or other registered entity duly organized and existing under the laws of the state of its organization or (c) a non-registered
entity exempt from registration under the laws of any state or jurisdiction. The Borrower is duly qualified and in good standing
where such qualification is necessary. This Note has been duly authorized, executed and delivered by Borrower, has been duly executed
by Borrower or an authorized representative of the Borrower, constitutes Borrower’s valid and legally binding obligation
and is enforceable in accordance with its terms against Borrower. The execution, delivery and performance of this Note and the
consummation of the transaction contemplated will not, with or without the giving of notice or the lapse of time, (a) violate
any law applicable to Borrower, (b) violate any judgment, writ, injunction or order of any court or governmental body or officer
applicable to Borrower, (c) violate or result in the breach of any material agreement to which Borrower is a party, nor (d) violate
Borrower’s charter, bylaws, articles of organization, operating agreement or any other similar formation or governing documentation,
as applicable. No consent, approval, license, permit or other authorization of any third party or any governmental body or officer
is required for the valid and lawful execution and delivery of this Note. If Borrower is required to deliver to Bank a Beneficial
Ownership Certification pursuant to the requirements of the Beneficial Ownership Rule (31 C.F.R. § 1010.230), Borrower represents
and warrants that the information included in such Beneficial Ownership Certification, or in any other certifications provided
by Borrower or its authorized representative under the application for this loan, is true and correct in all respects. As of the
date of this Note, Borrower represents that Borrower is not subject to any material claim, dispute or litigation that has not
been previously disclosed to Bank in writing.

 

CARES Act Compliance. Borrower
represents, warrants and covenants to Bank, as of the date hereof, the end of the 8-week period following the date of the Loan
(“Forgiveness Period”), and the date that SBA remits payment of the forgiven amount of the Loan to Bank and at all
times the Loan exists or this Note is in effect, as follows:

(a)          
Neither Borrower nor any Owner, is presently suspended, debarred, proposed for debarment, declared ineligible, voluntarily
excluded from participation in this transaction by any Federal department or agency, or presently involved in any bankruptcy.

(b)          
Neither Borrower, nor any Owner, nor any business owned or controlled by any of them, ever obtained a direct or guaranteed
loan from SBA or any other Federal agency that is currently delinquent or has defaulted in the last 7 years and caused a loss
to the government.

(c)          
Neither Borrower, nor any Owner, is an owner of any other business or has common management with any other business, except
as disclosed on addendum A of the Application.

(d)          
Borrower did not receive an SBA Economic Injury Disaster Loan between January 31, 2020 and April 3, 2020, except as disclosed
on addendum A of the Application.

 

 

 

    	 	3	 

     

    

 

(e)          
Neither Borrower (if an individual), nor any individual owning 20% or more of the equity of Borrower, is subject to an
indictment, criminal information, arraignment, or other means by which formal criminal charges are brought in any jurisdiction,
or presently incarcerated, on probation or parole.

(f)           
Neither Borrower (if an individual), nor any Owner, has within the last 5 years 1) been convicted; 2) pleaded guilty; 3)
pleaded nolo contendere; 4) been placed on pretrial diversion; or 5) been placed on any form of parole or probation (including
probation before judgment).

(g)          
The United States is the principal place of residence for all employees of Borrower included in Borrower’s payroll
calculation included in the Application.

(h)          
Borrower acknowledges and agrees that all proceeds of the Loan shall be used solely to fund the uses specified in the Paycheck
Protection Program Rule (“Allowable Costs”); provided that, for the avoidance of doubt, in no event shall more than
twenty-five percent (25%) of the total Allowable Costs paid by Borrower using proceeds of the Loan be attributable to non-payroll
costs.

(i)           
At the conclusion of the Forgiveness Period, Borrower shall promptly but in no event more than thirty (30) days following
the conclusion of the Forgiveness Period submit to Bank all documentation, accompanying certifications and other relevant disclosures
required by the SBA under the CARES Act or otherwise requested by Bank on the worksheet provided by Bank for calculation of loan
forgiveness amounts, a copy of which will be provided to Borrower after the date hereof.

 

Default, Acceleration
and Setoff

An “event of
default” shall occur hereunder upon the occurrence of any one or more of the following events or conditions:

		(a)	the failure by any Obligor to pay at any time after the
date that occurs six months after the funding date of this Note, whether by acceleration or otherwise, (i) any interest or fees
owed under this Note when due and such failure shall continue unremedied for a period of five (5) days thereafter or (ii) any
principal amount owed under this Note when due;

		(b)	(i) the occurrence of any event of default under any other
agreement executed in connection with this Note or the failure of any Obligor to perform any covenant, promise or obligation contained
in this Note or such other agreement, provided, however that if such failure relates to a covenant other than a negative covenant
or a financial covenant under this Note or any agreement executed in connection with this Note, the Obligor shall have thirty
(30) days to cure such failure after the earlier of the date (A) the Obligor or any officer or representative of the Obligor becomes
aware of such failure or (B) notice of such failure is given to such Obligor by Bank or (ii) the occurrence of any event of default
under, or the failure of any Obligor to perform any covenant, promise or obligation contained in, any other agreement to which
any Obligor and any Bank Party are parties;

		(c)	any representation or warranty of any Obligor contained
in this Note or any other agreement with any Bank Party shall prove to be incorrect in any material respect (other than any representation
or warranty that is expressly qualified by a material adverse effect or other materiality, in which case such representation or
warranty shall prove to be incorrect in any respect);

		(d)	the failure of any Obligor to pay when due any principal,
interest or other amount due under any indebtedness of such Obligor (after any applicable grace period specified in connection
with such indebtedness) to any creditor other than Bank or any event shall occur or condition shall exist under any agreement
or instrument relating to such indebtedness, if the effect of such event or condition is to accelerate, or permit the acceleration,
of such indebtedness;

		(e)	the dissolution, liquidation, merger, consolidation, termination
or suspension of usual business of any Obligor;

		(f)	the death or declaration of incompetency of any Obligor
that is a natural person unless within thirty (30) days after the death or declaration of incompetency of such Obligor, a substitute
Obligor acceptable to Bank shall have executed documentation in form and substance acceptable to Bank;

		(g)	any person or entity, or any group of related persons or
entities, shall, without Bank’s prior written consent, have or obtain legal or beneficial ownership of a majority of the
outstanding voting securities or rights of any Obligor that is not a natural person, other than any person or entity, or any group
of related persons or entities that has such majority ownership as of the date of this Note; or any change in the ownership or
control information in Borrower’s Beneficial Ownership Certification shall have occurred since the date of this Note;

		(h)	any Obligor shall (i) commence a voluntary case or other
proceeding or file any petition seeking liquidation, reorganization or other relief under any federal, state or foreign bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking the appointment of a custodian, trustee, receiver, liquidator
or other similar official for such Obligor or any substantial part of such Obligor’s property, (ii) consent to the institution
of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (i) of this section
(h), (iii) apply for or consent to the appointment of a custodian, trustee, receiver, liquidator or other similar official for
such Obligor or for a substantial part of such Obligor’s assets, (iv) file an answer admitting the material allegations
of a petition filed against such Obligor in any such proceeding, (v) make a general assignment for the benefit of creditors, or
(vi) take any action for the purpose of effecting any of the foregoing;

		(i)	an involuntary proceeding shall be commenced or an involuntary
petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of any Obligor or such Obligor’s
debts, or any substantial part of such Obligor’s assets, under any federal, state or foreign bankruptcy, insolvency or other
similar law now or hereafter in effect or (ii) the appointment of a custodian, trustee, receiver, liquidator or other similar
official for any Obligor or for a substantial part of such Obligor’s assets, and in any such case, such proceeding or petition
shall remain undismissed for a period of sixty (60) days or an order or decree approving or ordering any of the foregoing shall
be entered;

 

 

    	 	4	 

     

    

 

		(j)	the entry of a judgment, award or order against any Obligor
which remains unstayed, unsatisfied or unbonded for thirty (30) days following the issuance of such judgment, award or order,
or the issuance or service of any attachment, levy or garnishment against any Obligor or the property of any Obligor or the repossession
or seizure of property of any Obligor;

		(k)	the sale or transfer by any Obligor of all or substantially
all of such Obligor’s assets other than in the ordinary course of business;

		(l)	any provision of any guaranty, security agreement, or other
collateral documentation shall, due to any act or failure to act by any Obligor, cease to be valid and binding on, or enforceable
against, any Obligor, or any Obligor shall so state in writing, or any Obligor shall terminate or seek to terminate such Obligor’s
obligations under such agreements;

		(m)	a material adverse change in the financial condition, operations,
business, or prospects of any Obligor has occurred since the date of this Note; or

		(n)	an event of default occurs under this Note or on any other
outstanding SBA or SBA guaranteed loan to Borrower.

 

Bank shall not be obligated
to fund this Note or make any advance under this Note if at the time such funding or advance is requested there exists (i) an
event of default or (ii) an event or condition which with the passage of time or giving of notice or both would result in an event
of default. Upon the occurrence of an event of default, Bank shall, at its option, have the remedies provided herein and by any
other agreement between Bank and any Obligor or under applicable law, including without limitation, declaring the entire outstanding
principal balance, together with all interest thereon and any other amounts due under this Note, to be due and payable immediately
without presentment, demand, protest, or notice of any kind, except notice required by law. Upon the occurrence of an event of
default under paragraph (h) or (i) above, the entire outstanding principal balance, together with all interest thereon and any
other amounts due under this Note, shall automatically become due and payable without presentment, demand, protest, or notice
of any kind except notice required by law, and Bank’s obligation to make advances under this Note shall automatically terminate
without notice or further action by Bank. Upon the occurrence of an event of default, as of the date of such event of default,
Bank, at its option, may charge interest on the unpaid balance of this Note at the lesser of (a) the Rate plus 4.00% per annum
or (b) the maximum rate allowed by law (the “Default Rate”) until paid in full. To the extent permitted by law, upon
the occurrence of an event of default, Bank will have the right, in addition to all other remedies provided herein, to set off
the amount due under this Note or due under any other obligation of Borrower to Bank against any and all accounts, whether checking
or savings or otherwise, credits, money, stocks, bonds or other security or property of any nature whatsoever on deposit with,
held by, owed by, or in the possession of any Bank Party to the credit of or for the account of Borrower, without notice or consent
of Borrower. In addition to the foregoing, Bank shall not be obligated to fund this Note or make any advance under this Note in
the event of material deterioration or impairment of the Collateral or any material decline or depreciation in the value of the
Collateral which causes the Collateral to become unsatisfactory as to character or value. The remedies provided in this Note and
any other agreement between Bank and any Obligor and by applicable law are cumulative and not exclusive of any other remedies
provided by applicable law.

 

If any portion of a
payment is at least fifteen (15) days past due, Borrower agrees to pay a late charge equal to the lesser of $50.00 or 4% of the
amount which is past due. Unless prohibited by applicable law, Borrower agrees to pay the fee established by Bank from time to
time for returned checks if a payment is made on this Note with a check and the check is dishonored for any reason after the second
presentment. In addition to any other amounts owed under the terms of this Note, Borrower agrees to pay those fees and charges
disclosed in the Disbursements and Charges Summary or other form of closing statement, if any, related to the loan evidenced by
this Note which, to the extent it exists, is incorporated in this Note by reference and, as permitted by applicable law, Borrower
agrees to pay the following: (a) all expenses, including, without limitation, any and all costs incurred by Bank related to enforcement,
all court costs and out-of-pocket collection expenses, and reasonable attorneys’ fees actually incurred, whether suit be
brought or not, incurred in collecting this Note; (b) all costs incurred in evaluating, preserving or disposing of any Collateral
granted or hereafter granted as security for the payment of this Note, including the cost of any audits, appraisals, appraisal
updates, reappraisals or environmental inspections which Bank from time to time in its sole discretion may deem necessary; (c)
any premiums for property insurance purchased on behalf of Borrower or on behalf of the owner(s) of any Collateral pursuant to
any security instrument relating to any Collateral; (d) any expenses or costs (including reasonable attorneys’ fees) incurred
in defending any claim arising out of the execution of this Note or the obligations which it evidences; and (e) any other charges
permitted by applicable law. Borrower agrees to pay such amounts on demand or, at Bank’s option, such amounts may be added
to the unpaid balance of the Note and shall accrue interest at the stated Rate.

 

Prepayment Provisions

Borrower may make a
prepayment in any amount at any time without penalty.

 

 

 

 

    	 	5	 

     

    

 

Payments

Borrower is directed
to make payments at the address indicated on the billing statement provided by Bank, or at such place as Bank may otherwise indicate
in writing. Payments may also be made at those Bank branches which accept loan payments, however, Borrower acknowledges that Borrower
is not directed to make payments at such branches and that Bank’s acceptance of payments at such branches is an accommodation
to Borrower which may be revoked at any time in Bank’s sole and absolute discretion. All amounts received by Bank shall
be applied to expenses, fees and interest before principal or in any other order as determined by Bank, in its sole discretion,
as permitted by law. Payments will be credited as of the date stamped upon receipt, or as of the standard payment processing date
for similar payments if a payment is not stamped. Payments received on Saturday will be credited on Bank’s next business
day. If any payment date falls on a Saturday or Sunday or a legal bank holiday, payment will be due on the next business day.
Bank’s business days are Monday through Friday, not including legal bank holidays.

 

Waivers

Borrower and each other
Obligor waive presentment, demand, protest, notice of protest and notice of dishonor and waive all exemptions, whether homestead
or otherwise, as to the obligations evidenced by this Note and waive any discharge or defenses based on suretyship or impairment
of Collateral or of recourse. Borrower waives any rights to require Bank to proceed against any other Obligor or any Collateral
before proceeding against Borrower. Borrower further agrees that without notice to any Obligor and without affecting any Obligor’s
liability, Bank, at any time or times, may grant extensions of the time for payment or other indulgences to any Obligor or permit
the renewal or modification of this Note, or permit the substitution, exchange or release of any Collateral for this Note and
may add or release any Obligor whether primarily or secondarily liable. Borrower further agrees that Bank may apply all monies
made available to it from any part of the proceeds of the disposition of any Collateral or by exercise of the right of setoff
either to the obligations under this Note or to any other obligations of any Obligor to Bank, as Bank may elect from time to time.

 

Waiver of Jury Trial

TO THE EXTENT PERMITTED
BY APPLICABLE LAW, BORROWER AND BANK HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY, AND IRREVOCABLY WAIVE, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, THE RIGHT EITHER OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT TO ANY LITIGATION, WHETHER IN CONTRACT
OR TORT OR OTHERWISE, AT LAW OR IN EQUITY, BASED HEREON OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE AND ANY OTHER
DOCUMENT OR INSTRUMENT CONTEMPLATED TO BE EXECUTED IN CONJUNCTION WITH THIS NOTE, OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY HERETO. THIS PROVISION IS A MATERIAL INDUCEMENT FOR BANK ENTERING
INTO OR ACCEPTING THIS NOTE. FURTHER, BORROWER HEREBY CERTIFIES THAT NO REPRESENTATIVE OR AGENT OF BANK, NOR BANK’S COUNSEL,
HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT BANK WOULD NOT, IN THE EVENT OF SUCH LITIGATION, SEEK TO ENFORCE THIS WAIVER OF
RIGHT TO JURY TRIAL PROVISION.

 

Waiver of Damages
other than Direct or Actual

TO THE GREATEST
EXTENT PERMITTED BY APPLICABLE LAW, BORROWER AND BANK HEREBY IRREVOCABLY WAIVE (AND IRREVOCABLY AGREE NOT TO ASSERT) ANY CLAIM
WHATSOEVER FOR SPECIAL, INDIRECT, INCIDENTAL, EXEMPLARY, CONSEQUENTIAL OR PUNITIVE DAMAGES OR LOST PROFITS (AS OPPOSED TO DIRECT
OR ACTUAL DAMAGES) AGAINST EACH OTHER (OR AGAINST EACH OTHER’S RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, ATTORNEYS OR AGENTS)
AT ANY TIME ARISING UNDER OR RELATING TO THIS NOTE, ANY RELATED DOCUMENT, OR ANY TRANSACTION CONTEMPLATED HEREIN OR THEREIN.

 

Patriot Act Notice

Bank hereby notifies
Borrower that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 signed into law October 26, 2001),
Bank may be required to obtain, verify and record information that identifies Borrower, which information includes the name and
address of Borrower and other information that will allow Bank to identify Borrower in accordance with the Act. Further, Bank
hereby notifies Borrower that, pursuant to the requirements of the Beneficial Ownership Rule (31 C.F.R. § 1010.230), Bank
may be required to obtain, verify and record information contained in a Beneficial Ownership Certification executed by Borrower,
which will identify the key individuals who have beneficial ownership or control of Borrower.

 

 

 

    	 	6	 

     

    

 

Hold Harmless and
Indemnification

Borrower hereby indemnifies
and agrees to hold each Bank Party and its officers, directors, employees, agents and affiliates (each an “Indemnitee”)
harmless from and against all claims, damages, liabilities, costs (including reasonable attorneys’ fees and legal expenses),
causes of action, actions, suits and other legal proceedings (collectively, “Claims”) in any matter relating to or
arising out of this Note or any document or agreement executed in connection with this Note, or any act, event or transaction
related thereto or to the Collateral. Borrower shall promptly provide Bank with written notice of any such Claim, provided, however,
that this indemnity shall not apply to any Claims arising solely from the gross negligence or willful misconduct of such Indemnitee
as determined by a court of competent jurisdiction in a final non-appealable judgment or order. Upon request of Bank, Borrower
shall defend each applicable Indemnitee from such Claims, and pay the reasonable attorneys’ fees, legal expenses and other
costs actually incurred in connection therewith, or in the alternative, at Bank’s option, each applicable Indemnitee shall
be entitled to employ its own legal counsel to defend such Claims at Borrower’s sole expense.

 

Miscellaneous

Any provision of this
Note or any agreement executed in connection with this Note which is prohibited or unenforceable shall be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining provisions of this Note or any such agreement. No amendment,
modification, termination or waiver of any provision of this Note or any agreement executed in connection with this Note, nor
consent to any departure by Borrower from any term of this Note or any agreement executed in connection with this Note, shall
in any event be effective unless it is in writing and signed by an authorized officer of Bank, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose for which given. No failure or delay on the part
of Bank to exercise any right, power or remedy under this Note or any agreement executed in connection with this Note shall be
construed as a waiver of the right to exercise the same or any other right at any time. The captions of the paragraphs of this
Note are for convenience only and shall not be deemed to constitute a part hereof or used in construing the intent of the parties.
All representations, warranties, covenants and agreements contained herein or made in writing by Borrower in connection herewith
shall survive the execution and delivery of this Note and any other agreement, document or writing relating to or arising out
of any of the foregoing. All notices or communications given to Borrower pursuant to the terms of this Note shall be in writing
and may be given to Borrower at Borrower’s address as stated at the top of this Note unless Borrower notifies Bank in writing
of a different address. Unless otherwise specifically provided herein to the contrary, such written notices and communications
shall be delivered by hand or overnight courier service, or mailed by first class mail, postage prepaid, addressed to Borrower
at the address referred to herein. Any written notice delivered by hand or by overnight courier service shall be deemed given
or received upon receipt. Any written notice delivered by U.S. Mail shall be deemed given or received on the third (3rd) business
day after being deposited in the U.S. Mail. Notwithstanding any provision of this Note or any agreement executed in connection
with this Note to the contrary, Borrower and Bank intend that no provision of this Note or any agreement executed in connection
with this Note be interpreted, construed, applied, or enforced in a way that will permit or require the payment or collection
of interest in excess of the highest rate of interest permitted to be paid or collected by the laws of the jurisdiction indicated
below, or federal law if federal law preempts the law of such jurisdiction with respect to this transaction (the "Maximum
Permitted Rate"). If, however, any such provision is so interpreted, construed, applied, or enforced, Borrower and Bank intend
(a) that such provision automatically shall be deemed revised so as to require payment only of interest at the Maximum Permitted
Rate; and (b) if interest payments in excess of the Maximum Permitted Rate have been received, that the amount of such excess
shall be deemed credited retroactively in reduction of the then-outstanding principal amount of this obligation, together with
interest at the Maximum Permitted Rate. In connection with all calculations to determine the Maximum Permitted Rate, Borrower
and Bank intend (a) that all charges be excluded to the extent they are properly excludable under the usury laws of such jurisdiction
or the United States, as they from time to time are determined to apply to this obligation; and (b) that all charges that may
be spread in the manner provided by statute of the jurisdiction indicated or any similar law, be so spread. Borrower agrees to
sign any and all additional documentation Bank requests related to this Loan based upon amendments or revisions to the CARES Act,
Paycheck Protection Program Rule and the Application including, without limitation, any form promissory note issued by the SBA
or any amendment harmonizing this Note and such SBA form note.

 

Successors and Assigns
and Choice of Law

This Note shall apply
to and bind Borrower’s heirs, personal representatives, successors and permitted assigns and shall inure to the benefit
of Bank, its successors and assigns. Notwithstanding the foregoing, Borrower shall not assign Borrower’s rights or obligations
under this Note without Bank’s prior written consent. This Note shall be governed by applicable federal law and the internal
laws of the state of North Carolina. Borrower agrees that certain material events and occurrences relating to this Note bear a
reasonable relationship to the laws of North Carolina and the validity, terms, performance and enforcement of this Note shall
be governed by the internal laws of North Carolina which are applicable to agreements which are negotiated, executed, delivered
and performed solely in North Carolina. Unless applicable law provides otherwise, in the event of any legal proceeding arising
out of or related to this Note, Borrower consents to the jurisdiction and venue of any court located in the state of North Carolina.
Nothing in this Note or in any other document or agreement entered into in connection with this Note shall affect any right that
Bank may have to bring any action or proceeding arising out of or related to this Note against Borrower or its properties in the
courts of any jurisdiction.

 

 

 

 

    	 	7	 

     

    

 

In the event the SBA
becomes the holder of this Note, this Note will be interpreted and enforced under federal law, including SBA regulations. Bank
or SBA may use state or local procedures for filing papers, recording documents, giving notice, foreclosing liens, and other purposes.
By using such procedures, SBA does not waive any federal immunity from state or local control, penalty, tax, or liability. As
to this Note, Borrower may not claim or assert against SBA any local or state law to deny any obligation, defeat any claim of
SBA, or preempt federal law.

 

Documentary and
Intangible Taxes

In the event that any
intangible tax or documentary stamp tax is due from Bank to any state or other governmental agency or authority because of the
execution or holding of this Note, Borrower shall, upon demand, reimburse Bank for any such tax paid. Pursuant to State of Florida
Office of Governor Executive Order Number 20-95, the collection of Florida documentary stamp tax is suspended for all notes and
other written obligations made pursuant to Title 1 of the CARES Act and related regulations, rules, and guidance.

 

Transfer of Loan

Bank may, at any time,
sell, transfer or assign the Note, the related security instrument and any related loan documents, and any or all servicing rights
with respect thereto, or grant participations therein or issue mortgage pass-through certificates or other securities evidencing
a beneficial interest in a rated or unrated public offering or private placement (the “Securities”). Bank may forward
to each purchaser, transferee, assignee, servicer, participant, or investor in such Securities or any Rating Agency (as hereinafter
defined) rating such Securities (collectively, the “Investor”) and each prospective Investor, all documents and information
which Bank now has or may hereafter acquire relating to Borrower, any loan to Borrower, any guarantor or the property, whether
furnished by Borrower, any guarantor or otherwise, as Bank determines necessary or desirable. The term “Rating Agency”
shall mean each statistical rating agency that has assigned a rating to the Securities.

 

State Specific Disclosures

Texas residents:
This notice is being provided by Bank in compliance with §26.02 of the Texas Business and Commerce Code, which provides that
certain loan agreements must be in writing to be enforceable. As used in this notice, the term “loan agreement” means
one or more promises, promissory notes, agreements, undertakings, security agreements, deeds of trust, or other documents, or
commitments, or any combination of these actions or documents, executed in connection with the loan from Bank. THIS WRITTEN
LOAN AGREEMENT IN CONNECTION WITH THE NOTE REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE
OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
This notice shall be deemed to be a part of each document which is executed by the Borrower and which comprises a part of the
loan agreement. The Borrower acknowledges receipt of a copy of this notice and agrees that all documents in connection with the
Note are subject to the provisions of §26.02 of the Texas Business and Commerce Code.

 

Counterparts

This Note may be executed
in any number of counterparts, each of which shall be an original, but all of which shall together constitute one and the same
agreement. This Note shall be effective upon Borrower’s execution of this Note and Bank’s receipt of duly executed
counterparts from each of the parties hereto. Upon approval by Bank in its sole discretion, signatures to this Note transmitted
in a commonly accepted electronic format that reproduces an image of the actual executed signature page shall have the same legal
effect, validity, and enforceability as a manually executed counterpart of the document to the extent and as provided for in the
Federal Electronic Signatures in Global and National Commerce Act and the applicable state law based on the Uniform Electronic
Transactions Act. Further, Borrower agrees to deliver a manually executed counterpart of this Note to Bank no later than ten (10)
days following the date of this Note.

 

By signing below under seal, Borrower agrees to the terms of this Note and the disbursement
of proceeds as described in the Disbursements and Charges Summary form or other closing statement, if any, provided in connection
with this transaction.

 

 

Borrower Name: Applied Optoelectronics, Inc.

 

 

/s/ Stefan Murry                                                    (Seal)

Signature of Authorized Representative of Borrower

 

 

 

Name, printed or typed of Authorized Representative

 

    	 	8

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