Document:

Exhibit 4.4

Ex. 4.4

PROMISSORY NOTE

$70,000

July 31, 2009

Irvine, California

FOR VALUE RECEIVED, BioLargo, Inc., a Delaware corporation (“Maker”) promises to pay to James D.
Masteller (“Holder”), or order, the principal sum of seventy thousand Dollars ($70,000) (the
“Principal Amount”) with interest from the date of this Note on unpaid principal owing at the rate
of ten percent (10%) per annum until fully paid. Principal plus all accrued and unpaid interest on
such principal shall be due and payable ninety (90) days from the date referenced above (“Maturity
Date”).

Maker shall make all payments in lawful money of the United States of America and in immediately
available funds. Computations of interest shall be based on a year of 360 days but shall be
calculated for the actual number of days in the period for which interest is charged.

This Note may be prepaid in whole or in part, without penalty, at the option of Maker and without
the consent of Holder. All payments under this Note shall be paid to Holder at 11701 Heathcliff
Drive, Santa Ana, California, or at such other address as Holder shall direct Maker in writing.

This Note shall be governed by the laws of the State of California excluding its conflict of laws
rules. The exclusive jurisdiction and venue of any legal action instituted by any party to this
Note shall be Orange County, California.

Maker shall pay all costs and expenses, including attorney fees, incurred (i) in collecting payment
on this Note, (ii) in connection with any dispute that arises as to its enforcement, validity, or
interpretation, whether or not legal action is instituted or prosecuted to judgment, or (iii) in
enforcing any judgment obtained in any related legal proceeding.

Any of the terms and conditions of this Note may be waived by Holder, but no such waiver shall
affect or impair the rights of Holder to require observance, performance, or satisfaction, either
of that term or condition as it applies on a subsequent occasion or of any other term or condition
of this Note.

	 	 	 	 	 
	BioLargo, Inc.

	 	 
	 
	 	 	 	 
	By:

	 	/s/ Dennis P. Calvert
 

	 	 
	 	 	Dennis P. Calvert, Presidentexv10w23

Exhibit 10.23

PROMISSORY NOTE

	 	 	 	 	 	 	 
	Borrower:
	 	READY MIX, INC., a Nevada corporation
3430 EAST FLAMINGO ROAD, SUITE 100
	 	Lender:
	 	NATIONAL BANK OF ARIZONA, a
national banking association
	 
	 	LAS VEGAS, NV 89121
	 	 	 	Mesa Main Office
	 
	 		 	 	 	1119 WEST SOUTHERN AVENUE
	 
	 	 	 	 	 	MESA, AZ 85210

	 
	 	 	 	 	 	

					
	Principal Amount: $1,500,000.00
	 	Interest Rate: 7.345%
	 	Date of Note: May 26, 2006

PROMISE TO PAY. READY MIX, INC., a Nevada corporation (“Borrower”) promises to pay to NATIONAL
BANK OF ARIZONA, a national banking association (“Lender”), or order, in lawful money of the
United States of America, the principal amount of One Million Five Hundred Thousand & 00/100
Dollars ($1,500,000.00), together with interest at the rate of 7.345% per annum on the unpaid
principal balance from May 26, 2006, until paid in full. The interest rate may change under the
terms and conditions of the “INTEREST AFTER DEFAULT” section.

PAYMENT. Borrower will pay this loan in 180 payments of $13,866.95 each payment. Borrower’s
first payment is due June 26, 2006, and all subsequent payments are due on the same day of each
month after that. Borrower’s final payment will be due on May 26, 2021, and will be for all
principal and all accrued interest not yet paid. Payments include principal and interest. Unless
otherwise agreed or required by applicable law, payments will be applied first to any accrued
unpaid interest; then to principal; then to any unpaid collection costs; and then to any late
charges. The annual interest rate for this Note is computed on a 365/360 basis; that is, by
applying the ratio of the annual 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. Borrower will pay Lender at Lender’s address shown above or at such other place as
Lender may designate in writing.

EFFECTIVE RATE. Borrower agrees to an effective rate of interest that is the rate specified in
this Note plus any additional rate resulting from any other charges in the nature of interest
paid or to be paid in connection with this Note.

PREPAYMENT PENALTY; MINIMUM INTEREST CHARGE. Borrower agrees that all loan fees and other
prepaid finance charges are earned fully as of the date of the 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. In any event, even upon full prepayment of this Note, Borrower understands that
Lender is entitled to a minimum interest charge of $250.00. Upon prepayment of this Note, Lender
is entitled to the following prepayment penalty: “Prepayment” shall be defined as any
accumulated unscheduled principal reduction of more than 5% of the original principal note
amount, occurring annually from the anniversary date of this Note. If Borrower chooses to prepay
this Note at any time during the first five years, in whole or in part; a prepayment penalty
will be due concurrent with the prepayment equal to 5% of the prepayment during the first year,
4% during the second year, 3% during the third year, 2% during the fourth year and 1% during the
fifth year. Thereafter, the Borrower may prepay this Note, in whole or in part, without
prepayment penalty. Partial prepayments shall then be applied against required payments of the
most remote maturity, and will not extend the dates nor change the amounts of subsequent
installment payments. No partial prepayment may be made with funds provided through borrowings.
Other than Borrower’s obligation to pay any minimum interest charge and prepayment penalty,
Borrower may pay 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 under the payment schedule. Rather, early payments will reduce the
principal balance due and may result in Borrower’s making fewer payments. 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: NATIONAL BANK OF ARIZONA, a national banking association; Mesa Main Office;
1119 WEST SOUTHERN AVENUE; MESA, AZ 85210.

LATE CHARGE. If a payment is 10 days or more late, Borrower will be charged 10.000% of the
regularly scheduled payment.

INTEREST AFTER DEFAULT. Upon default, including failure to pay upon final maturity, the
interest rate on this Note shall be increased to 18.000% per annum. However, in no event will
the interest rate exceed the maximum interest rate limitations under applicable law.

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.

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

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, endorser, surety, or accommodation party of any of the indebtedness or any
guarantor, endorser, surety, or accommodation party dies or becomes incompetent, or revokes
or disputes the validity of, or liability under, any guaranty of the indebtedness evidenced
by this Note. In the event of a death, Lender, at its option, may, but shall not be required
to, permit the guarantor’s estate to assume unconditionally the obligations arising under
the guaranty in a manner satisfactory to Lender, and, in doing so, cure any Event of
Default.

 

 

					
	 
	 	PROMISSORY NOTE	 	 
	Loan No: 9001
	 	(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 receiving written notice from
Lender 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. However, Borrower will only
pay attorneys’ fees of an attorney not Lender’s salaried employee, to whom the matter is referred
after Borrower’s default. If not prohibited by applicable law, 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 Arizona without regard to its conflicts of
law provisions. This Note has been accepted by Lender in the State of Arizona.

DISHONORED ITEM FEE. Borrower will pay a fee to Lender of $28.00 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.

COLLATERAL. Borrower acknowledges this Note is secured by a Deed of Trust and Fixture Filing, and
an Assignment of Rents from Borrower to Lender of even date.

ARBITRATION DISCLOSURES.

	 	1.	 	ARBITRATION IS FINAL AND BINDING ON THE PARTIES AND SUBJECT TO ONLY VERY LIMITED REVIEW BY A
COURT.
	 
	 	2.	 	IN ARBITRATION THE PARTIES ARE WAIVING THEIR RIGHT TO LITIGATE IN COURT, INCLUDING THEIR
RIGHT TO A JURY TRIAL.
	 
	 	3.	 	DISCOVERY IN ARBITRATION IS MORE LIMITED THAN DISCOVERY IN COURT.
	 
	 	4.	 	ARBITRATORS ARE NOT REQUIRED TO INCLUDE FACTUAL FINDINGS OR LEGAL REASONING IN THEIR
AWARDS. THE RIGHT TO APPEAL OR SEEK MODIFICATION OF ARBITRATORS’ RULINGS IS VERY LIMITED.
	 
	 	5.	 	A PANEL OF ARBITRATORS MIGHT INCLUDE AN ARBITRATOR WHO IS OR WAS AFFILIATED WITH THE BANKING
INDUSTRY.
	 
	 	6.	 	ARBITRATION WILL APPLY TO ALL DISPUTES BETWEEN THE PARTIES, NOT JUST THOSE CONCERNING THE
AGREEMENT.
	 
	 	7.	 	IF YOU HAVE QUESTIONS ABOUT ARBITRATION, CONSULT YOUR ATTORNEY OR THE AMERICAN ARBITRATION
ASSOCIATION.

(a) Any claim or controversy (“Dispute”) between or among the parties and their employees,
agents, affiliates, and assigns, including, but not limited to, Disputes arising out of or
relating to this agreement, this arbitration provision (“arbitration clause”),-or any related
agreements or instruments relating hereto or delivered in connection herewith (“Related
Agreements”), and including, but not limited to, a Dispute based on or arising from an alleged
tort, shall at the request of any party be resolved by binding arbitration in accordance with
the applicable arbitration rules of the American Arbitration Association (the “Administrator”).
The provisions of this arbitration clause shall survive any termination, amendment, or
expiration of this agreement or Related Agreements. The provisions of this arbitration clause
shall supersede any prior arbitration agreement between or among the parties.

(b) The arbitration proceedings shall be conducted in a city mutually agreed by the parties.
Absent such an agreement, arbitration will be conducted in Phoenix, Arizona or such other place
as may be determined by the Administrator. The Administrator and the arbitrator(s) shall have
the authority to the extent practicable to take any action to require the arbitration
proceeding to be completed and the arbitrator(s)’ award issued within 150 days of the filing of
the Dispute with the Administrator. The arbitrator(s) shall have the authority to impose
sanctions on any party that fails to comply with time periods imposed by the Administrator or
the arbitrator(s), including the sanction of summarily dismissing any Dispute or defense with
prejudice. The arbitrator(s) shall have the authority to resolve any Dispute regarding the
terms of this agreement, this arbitration clause, or Related Agreements, including any claim or
controversy regarding the arbitrability of any Dispute. All limitations periods applicable to
any Dispute or defense, whether by statute or agreement, shall apply to any arbitration
proceeding hereunder and the arbitrator(s) shall have the authority to decide whether any
Dispute or defense is barred by a limitations period and, if so, to summarily enter an award
dismissing any Dispute or defense on that basis. The doctrines of compulsory counterclaim, res
judicata, and collateral estoppel shall apply to any arbitration proceeding hereunder so that a
party must state as a counterclaim in the arbitration proceeding any claim or controversy which
arises out of the transaction or occurrence that is the subject matter of the Dispute. The
arbitrator(s) may in the arbitrator(s)’ discretion and at the request of any party: (1)
consolidate in a single arbitration proceeding any other claim arising out of the same
transaction involving another party to that transaction that is bound by an arbitration clause
with Lender, such as borrowers, guarantors, sureties, and owners of collateral; and (2)
consolidate or administer multiple arbitration claims or controversies as a class action in
accordance with Rule 23 of the Federal Rules of Civil Procedure.

(c) The arbitrator(s) shall be selected in accordance with the rules of the Administrator from
panels maintained by the Administrator. A single arbitrator shall have expertise in the subject
matter of the Dispute. Where three arbitrators conduct an arbitration proceeding, the Dispute
shall be decided by a majority vote of the three arbitrators, at least one of whom must have
expertise in the subject matter of the Dispute and at least one of whom must be a practicing
attorney. The arbitrator(s) shall award to the prevailing party recovery of all costs and fees
(including attorneys’ fees and costs, arbitration administration fees and costs, and
arbitrator(s)’ fees). The arbitrator(s), either during the pendency of the arbitration
proceeding or as part of the arbitration award, also may grant provisional or ancillary
remedies including but not limited to an award of injunctive relief, foreclosure,
sequestration, attachment, replevin, garnishment, or the appointment of a receiver.

(d) Judgement upon an arbitration award may be entered in any court having jurisdiction,
subject to the following limitation: the arbitration award is binding upon the parties only if
the amount does not exceed Four Million Dollars ($4,000,000.00); if the award exceeds that
limit, either party may demand the right to a court trial. Such a demand must be filed with
the Administrator within thirty (30) days following the

 

 

					
	 
	 	PROMISSORY NOTE	 	 
	Loan No: 9001
	 	(Continued)
	 	Page 3

date of the arbitration award; if such a demand is not made with that time period, the amount
of the arbitration award shall be binding. The computation of the total amount of an
arbitration award shall include amounts awarded for attorneys’ fees and costs, arbitration
administration fees and costs, and arbitrator(s)’ fees.

(e) No provision of this arbitration clause, nor the exercise of any rights hereunder, shall
limit the right of any party to: (1) judicially or non-judicially foreclose against any real or
personal property collateral or other security; (2) exercise self-help remedies, including but
not limited to repossession and setoff rights; or (3) obtain from a court having jurisdiction
thereover any provisional or ancillary remedies including but not limited to injunctive relief,
foreclosure, sequestration, attachment, replevin, garnishment, or the appointment of a
receiver. Such rights can be exercised at any time, before or after initiation of an
arbitration proceeding, except to the extent such action is contrary to the arbitration award.
The exercise of such rights shall not constitute a waiver of the right to submit any Dispute to
arbitration, and any claim or controversy related to the exercise of such rights shall be a
Dispute to be resolved under the provisions of this arbitration clause. Any party may initiate
arbitration with the Administrator. If any party desires to arbitrate a Dispute asserted
against such party in a complaint, counterclaim, cross-claim, or third-party complaint thereto,
or in an answer or other reply to any such pleading, such party must make an appropriate motion
to the trial court seeking to compel arbitration, which motion must be filed with the court
within 45 days of service of the pleading, or amendment thereto, setting forth such Dispute. If
arbitration is compelled after commencement of litigation of a Dispute, the party obtaining an
order compelling arbitration shall commence arbitration and pay the Administrator’s filing fees
and costs within 45 days of entry of such order. Failure to do so shall constitute an agreement
to proceed with litigation and waiver of the right to arbitrate. In any arbitration commenced
by a consumer regarding a consumer Dispute, Lender shall pay one half of the Administrator’s
filing fee, up to $250.

(f) Notwithstanding the applicability of any other law to this agreement, the arbitration
clause, or Related Agreements between or among the parties, the Federal Arbitration Act, 9
U.S.C. Section 1 et seq., shall apply to the construction and interpretation of this
arbitration clause. If any provision of this arbitration clause should be determined to be
unenforceable, all other provisions of this arbitration clause shall remain in full force and
effect.

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.

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 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.

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

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

BORROWER:

READY MIX, INC., A NEVADA CORPORATION

By:
/s/ Bradley E.
Larson                                   

       BRADLEY E. LARSON, Chief
Executive Officer of

       READY MIX,
INC., a Nevada corporation

LASER
PRO Lending, Ver. 5.31.00.004 Copr. Harland Financial Solutions, Inc.
1997, 2006. All Rights Reserved.  — AZ C:\LPWIN\CFI\LPL\D20.FC TR-26474 PR-1

 

 

BUSINESS LOAN AGREEMENT

	 	 	 	 	 	 	 
	Borrower:

	 	READY MIX, INC., a Nevada corporation
	 	Lender:
	 	NATIONAL BANK OF ARIZONA, a national banking
	 

	 	3430 EAST FLAMINGO ROAD, SUITE 100
	 	 	 	association
	 

	 	LAS VEGAS, NV 89121
	 	 	 	Mesa Main Office
	 

	 	 	 	 	 	1119 WEST SOUTHERN AVENUE
	 

	 	 	 	 	 	MESA, AZ 85210

THIS BUSINESS LOAN AGREEMENT dated May 26, 2006, is made and executed between READY MIX, INC.,
a Nevada corporation (“Borrower”) and NATIONAL BANK OF ARIZONA, a national banking association
(“Lender”) on the following terms and conditions. Borrower has received prior commercial loans
from Lender or has applied to Lender for a commercial loan or loans or other financial
accommodations, including those which may be described on any exhibit or schedule attached to
this Agreement (“Loan”). Borrower understands and agrees that: (A) in granting, renewing, or
extending any Loan, Lender is relying upon Borrower’s representations, warranties, and
agreements as set forth in this Agreement; (B) the granting, renewing, or extending of any Loan
by Lender at all times shall be subject to Lender’s sole judgment and discretion; and (C) all
such Loans shall be and remain subject to the terms and conditions of this Agreement.

TERM. This Agreement shall be effective as of May 26, 2006, and shall continue in full force
and effect until such time as all of Borrower’s Loans in favor of Lender have been paid in
full, including principal, interest, costs, expenses, attorneys’ fees, and other fees and
charges, or until such time as the parties may agree in writing to terminate this Agreement.

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

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

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

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

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

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

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

Organization. Borrower is a corporation for profit which is, and at all times shall be,
duly organized, validly existing, and in good standing under and by virtue of the laws of
the State of Nevada. Borrower is duly authorized to transact business in the State of
Arizona and all other states in which Borrower is doing business, having obtained all
necessary filings, governmental licenses and approvals for each state in which Borrower is
doing business. Specifically, Borrower is, and at all times shall be, duly qualified as a
foreign corporation in all states in which the failure to so qualify would have a material
adverse effect on its business or financial condition. Borrower has the full power and
authority to own its properties and to transact the business in which it is presently
engaged or presently proposes to engage. Borrower maintains an office at 3430 EAST FLAMINGO
ROAD, SUITE 100, LAS VEGAS, NV 89121. Unless Borrower has designated otherwise in writing,
the principal office is the office at which Borrower keeps its books and records including
its records concerning the Collateral. Borrower will notify Lender prior to any change in
the location of Borrower’s state of organization or any change in Borrower’s name. Borrower
shall do all things necessary to preserve and to keep in full force and effect its
existence, rights and privileges, and shall comply with all regulations, rules, ordinances,
statutes, orders and decrees of any governmental or quasi-governmental authority or court
applicable to Borrower and Borrower’s business activities.

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

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

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

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

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

Hazardous Substances. Except as disclosed to and acknowledged by Lender in writing,
Borrower represents and warrants that: (1) During the period of Borrower’s ownership of the
Collateral, there has been no use, generation, manufacture, storage, treatment, disposal,
release or threatened release of any Hazardous Substance by any person on, under, about or
from any of the Collateral. (2) Borrower has no knowledge of, or reason to believe that
there has been (a) any breach or violation of any Environmental Laws; (b) any use,
generation, manufacture, storage, treatment, disposal, release or threatened release of
any Hazardous Substance on, under, about or from the

 

 

					
	 
	 	BUSINESS LOAN AGREEMENT	 	 
	Loan No: 9001
	 	(Continued)
	 	Page 2

Collateral by any prior owners or occupants of any of the Collateral; or (c) any actual or
threatened litigation or claims of any kind by any person relating to such matters. (3) Neither
Borrower nor any tenant, contractor, agent or other authorized user of any of the Collateral
shall use, generate, manufacture, store, treat, dispose of or release any Hazardous Substance
on, under, about or from any of the Collateral; and any such activity shall be conducted in
compliance with all applicable federal, state, and local laws, regulations, and ordinances,
including without limitation all Environmental Laws. Borrower authorizes Lender and its agents
to enter upon the Collateral to make such inspections and tests as Lender may deem appropriate
to determine compliance of the Collateral with this section of the Agreement. Any inspections
or tests made by Lender shall be at Borrower’s expense and for Lender’s purposes only and shall
not be construed to create any responsibility or liability on the part of Lender to Borrower or
to any other person. The representations and warranties contained herein are based on
Borrower’s due diligence in investigating the Collateral for hazardous waste and Hazardous
Substances. Borrower hereby (1) releases and waives any future claims against Lender for
indemnity or contribution in the event Borrower becomes liable for cleanup or other costs under
any such laws, and (2) agrees to indemnify and hold harmless Lender against any and all claims,
losses, liabilities, damages, penalties, and expenses which Lender may directly or indirectly
sustain or suffer resulting from a breach of this section of the Agreement or as a consequence
of any use, generation, manufacture, storage, disposal, release or threatened release of a
hazardous waste or substance on the Collateral. The provisions of this section of the
Agreement, including the obligation to indemnify, shall survive the payment of the Indebtedness
and the termination, expiration or satisfaction of this Agreement and shall not be affected by
Lender’s acquisition of any interest in any of the Collateral, whether by foreclosure or
otherwise.

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

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

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

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

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

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

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

Financial Statements. Furnish Lender with the following:

Annual Statements. As soon as available, but in no event later than one-hundred-twenty
(120) days after the end of each fiscal year, Borrower’s balance sheet and income statement
for the year ended, audited by a certified public accountant satisfactory to Lender.

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

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

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

Insurance Reports. Furnish to Lender, upon request of Lender, reports on each existing
insurance policy showing such information as Lender may reasonably request, including without
limitation the following: (1) the name of the insurer; (2) the risks insured; (3) the amount
of the policy; (4) the properties insured; (5) the then current property values on the basis
of which insurance has been obtained, and the manner of determining those values; and (6) the
expiration date of the policy. In addition, upon request of Lender (however not more often
than annually), Borrower will have an independent appraiser satisfactory to Lender determine,
as applicable, the actual cash value or replacement cost of any Collateral. The cost of such
appraisal shall be paid by Borrower.

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

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

Taxes, Charges and Liens. Pay and discharge when due all of its indebtedness and obligations,
including without limitation all assessments, taxes, governmental charges, levies and liens,
of every kind and nature, imposed upon Borrower or its properties, income, or profits, prior
to the date on which penalties would attach, and all lawful claims that, if unpaid, might
become a lien or charge upon any of Borrower’s properties, income, or profits.

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

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

 

 

					
	 
	 	BUSINESS LOAN AGREEMENT	 	 
	Loan No: 9001
	 	(Continued)
	 	Page 3

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

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

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

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

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

RECOVERY OF ADDITIONAL COSTS. If the imposition of or any change in any law, rule, regulation or
guideline, or the interpretation or application of any thereof by any court or administrative or
governmental authority (including any request or policy not having the force of law) shall impose,
modify or make applicable any taxes (except federal, state or local income or franchise taxes
imposed on Lender), reserve requirements, capital adequacy requirements or other obligations which
would (A) increase the cost to Lender for extending or maintaining the credit facilities to which
this Agreement relates, (B) reduce the amounts payable to Lender under this Agreement or the
Related Documents, or (C) reduce the rate of return on Lender’s capital as a consequence of
Lender’s obligations with respect to the credit facilities to which this Agreement relates, then
Borrower agrees to pay Lender such additional amounts as will compensate Lender therefor, within
five (5) days after Lender’s written demand for such payment, which demand shall be accompanied by
an explanation of such imposition or charge and a calculation in reasonable detail of the
additional amounts payable by Borrower, which explanation and calculations shall be conclusive in
the absence of manifest error.

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

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

Indebtedness and Liens. (1) Except for trade debt incurred in the normal course of business
and indebtedness to Lender contemplated by this Agreement, create, incur or assume indebtedness
for borrowed money, including capital leases, (2) sell, transfer, mortgage, assign,
pledge, lease, grant a security interest in, or encumber any of Borrower’s assets (except as
allowed as Permitted Liens), or (3) sell with recourse any of Borrower’s accounts, except to
Lender.

Continuity
of Operations. (1) Except as in the normal course of business engage in
any business activities substantially different than
those in which Borrower is presently engaged, (2) cease operations, liquidate, merge, transfer,
acquire or consolidate with any other entity, change its name, dissolve or transfer or sell
Collateral out of the ordinary course of business, or (3) pay any dividends on Borrower’s stock
(other than dividends payable in its stock), provided, however that notwithstanding the
foregoing, but only so long as no Event of Default has occurred and is continuing or would
result from the payment of dividends, if Borrower is a “Subchapter S Corporation” (as defined
in the Internal Revenue Code of 1986, as amended), Borrower may pay cash dividends on its stock
to its shareholders from time to time in amounts necessary to enable the shareholders to pay
income taxes and make estimated income tax payments to satisfy their liabilities under federal
and state law which arise solely from their status as Shareholders of a Subchapter S
Corporation because of their ownership of shares of Borrower’s stock, or purchase or retire any
of Borrower’s outstanding shares or alter or amend Borrower’s capital structure.

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

Agreements. Borrower will not enter into any agreement containing any provisions which
would be violated or breached by the performance of Borrower’s obligations under this
Agreement or in connection herewith.

CESSATION OF ADVANCES. If Lender has made any commitment to make any Loan to Borrower, whether
under this Agreement or under any other agreement, Lender shall have no obligation to make Loan
Advances or to disburse Loan proceeds if: (A) Borrower or any Guarantor is in default under the
terms of this Agreement or any of the Related Documents or any other agreement that Borrower or any
Guarantor has with Lender; (B) Borrower or any Guarantor dies, becomes incompetent or becomes
insolvent, files a petition in bankruptcy or similar proceedings,

 

 

					
	 
	 	BUSINESS LOAN AGREEMENT	 	 
	Loan No: 9001
	 	(Continued)
	 	Page 4

or is adjudged a bankrupt; (C) there occurs a material adverse change in Borrower’s financial
condition, in the financial condition of any Guarantor, or in the value of any Collateral
securing any Loan; or (D) any Guarantor seeks, claims or otherwise attempts to limit, modify
or revoke such Guarantor’s guaranty of the Loan or any other loan with Lender; or (E) Lender
in good faith deems itself insecure, even though no Event of Default shall have occurred.

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.

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

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

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

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

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

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

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

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

Creditor or Forfeiture Proceedings. Commencement of foreclosure or forfeiture proceedings,
whether by judicial proceeding, self-help, repossession or any other method, by any
creditor of Borrower or by any governmental agency against any collateral securing the
Loan. This includes a garnishment of any of Borrower’s accounts, including deposit
accounts, with Lender. However, this Event of Default shall not apply if there is a good
faith dispute by Borrower as to the validity or reasonableness of the claim which is the
basis of the creditor or forfeiture proceeding and 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. In the event of a
death, Lender, at its option, may, but shall not be required to, permit the Guarantor’s estate to
assume unconditionally the obligations arising under the guaranty in a manner satisfactory to
Lender, and, in doing so, cure any Event of Default.

Change in Ownership. Any change in ownership of twenty-five percent (25%) or more of the common
stock of Borrower, not including publicly traded shares.

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

Insecurity. Lender in good faith believes itself insecure.

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

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

ERRORS AND OMISSIONS PROVISION. BORROWER HEREBY AGREES THAT IT WILL, WITHIN TEN (10) DAYS OF
A REQUEST BY LENDER, COMPLY WITH ANY REQUEST BY LENDER TO CORRECT DOCUMENTATION ERRORS,
OMISSIONS OR OVERSIGHTS, IF ANY, THAT OCCUR IN ANY DOCUMENTATION RELATING TO THIS LOAN.

FINANCIAL RATIO COVENANTS. BORROWER AGREES TO MAINTAIN ON AN UNCONSOLIDATED BASIS A MINIMUM
ADJUSTED EBITDA DEBT COVERAGE RATIO OF AT LEAST 1.25:1.00 AT YEAR END. ADJUSTED EBITDA
(EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION EXPENSE) IS THE SUM OF NET
INCOME BEFORE TAXES, TOTAL INTEREST EXPENSE, DEPRECIATION AND AMORTIZATION AND LEASE OR RENT
EXPENSE LESS TAXES PAID. ADJUSTED EBITDA DEBT COVERAGE RATIO IS DEFINED AS ADJUSTED EBITDA
(DESCRIBED ABOVE) TO THE SUM OF TOTAL INTEREST, LEASE OR RENT EXPENSE AND THE CURRENT PORTION
OF LONG TERM DEBT.

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

 

 

					
	 
	 	BUSINESS LOAN AGREEMENT	 	 
	Loan No: 9001
	 	(Continued)
	 	Page 5

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

Arbitration Disclosures.

	 	1.	 	ARBITRATION IS FINAL AND BINDING ON THE PARTIES AND SUBJECT TO ONLY VERY LIMITED REVIEW BY A
COURT.
	 
	 	2.	 	IN ARBITRATION THE PARTIES ARE WAIVING THEIR RIGHT TO LITIGATE IN COURT, INCLUDING THEIR
RIGHT TO A JURY TRIAL.
	 
	 	3.	 	DISCOVERY IN ARBITRATION IS MORE LIMITED THAN DISCOVERY IN COURT.
	 
	 	4.	 	ARBITRATORS ARE NOT REQUIRED TO INCLUDE FACTUAL FINDINGS OR LEGAL REASONING IN THEIR
AWARDS. THE RIGHT TO APPEAL OR SEEK MODIFICATION OF ARBITRATORS’ RULINGS IS VERY LIMITED.
	 
	 	5.	 	A PANEL OF ARBITRATORS MIGHT INCLUDE AN ARBITRATOR WHO IS OR WAS AFFILIATED WITH THE BANKING
INDUSTRY.
	 
	 	6.	 	ARBITRATION WILL APPLY TO ALL DISPUTES BETWEEN THE PARTIES, NOT JUST THOSE CONCERNING THE
AGREEMENT.
	 
	 	7.	 	IF YOU HAVE QUESTIONS ABOUT ARBITRATION, CONSULT YOUR ATTORNEY OR THE AMERICAN ARBITRATION
ASSOCIATION.

(a) Any claim or controversy (“Dispute”) between or among the parties and their employees,
agents, affiliates, and assigns, including, but not limited to, Disputes arising out of or
relating to this agreement, this arbitration provision (“arbitration clause”), or any related
agreements or instruments relating hereto or delivered in connection herewith (“Related
Agreements”), and including, but not limited to, a Dispute based on or arising from an alleged
tort, shall at the request of any party be resolved by binding arbitration in accordance with
the applicable arbitration rules of the American Arbitration Association (the “Administrator”).
The provisions of this arbitration clause shall survive any termination, amendment, or
expiration of this agreement or Related Agreements. The provisions of this arbitration clause
shall supersede any prior arbitration agreement between or among the parties.

(b) The arbitration proceedings shall be conducted in a city mutually agreed by the parties.
Absent such an agreement, arbitration will be conducted in Phoenix, Arizona or such other place
as may be determined by the Administrator. The Administrator and the arbitrator(s) shall have
the authority to the extent practicable to take any action to require the arbitration
proceeding to be completed and the arbitrator(s)’ award issued within 150 days of the filing of
the Dispute with the Administrator. The arbitrator(s) shall have the authority to impose
sanctions on any party that fails to comply with time periods imposed by the Administrator or
the arbitrator(s), including the sanction of summarily dismissing any Dispute or defense with
prejudice. The arbitrator(s) shall have the authority to resolve any Dispute regarding the
terms of this agreement, this arbitration clause, or Related Agreements, including any claim
or controversy regarding the arbitrability of any Dispute. All limitations periods applicable
to any Dispute or defense, whether by statute or agreement, shall apply to any arbitration
proceeding hereunder and the arbitrator(s) shall have the authority to decide whether any
Dispute or defense is barred by a limitations period and, if so, to summarily enter an award
dismissing any Dispute or defense on that basis. The doctrines of compulsory counterclaim, res
judicata, and collateral estoppel shall apply to any arbitration proceeding hereunder so that a
party must state as a counterclaim in the arbitration proceeding any claim or controversy which
arises out of the transaction or occurrence that is the subject matter of the Dispute. The
arbitrator(s) may in the arbitrator(s)’ discretion and at the request of any party: (1)
consolidate in a single arbitration proceeding any other claim arising out of the same
transaction involving another party to that transaction that is bound by an arbitration clause
with Lender, such as borrowers, guarantors, sureties, and owners of collateral; and (2)
consolidate or administer multiple arbitration claims or controversies as a class action in
accordance with Rule 23 of the Federal Rules of Civil Procedure.

(c) The arbitrator(s) shall be selected in accordance with the rules of the Administrator from
panels maintained by the Administrator. A
single arbitrator shall have expertise in the subject matter of the Dispute. Where three
arbitrators conduct an arbitration proceeding, the
Dispute shall be decided by a majority vote of the three arbitrators, at least one of whom must
have expertise in the subject matter of the
Dispute and at least one of whom must be a practicing attorney. The arbitrator(s) shall award
to the prevailing party recovery of all costs
and fees (including attorneys’ fees and costs, arbitration administration fees and costs, and
arbitrator(s)’ fees). The arbitrator(s), either
during the pendency of the arbitration proceeding or as part of the arbitration award, also may
grant provisional or ancillary remedies
including but not limited to an award of injunctive relief, foreclosure, sequestration,
attachment, replevin, garnishment, or the appointment
of a receiver.

(d) Judgement upon an arbitration award may be entered in any court having jurisdiction,
subject to the following limitation: the arbitration award is binding upon the parties only if
the amount does not exceed Four Million Dollars ($4,000,000.00); if the award exceeds that
limit, either party may demand the right to a court trial. Such a demand must be filed with the
Administrator within thirty (30) days following the date of the arbitration award; if such a
demand is not made with that time period, the amount of the arbitration award shall be binding.
The computation of the total amount of an arbitration award shall include amounts awarded for
attorneys’ fees and costs, arbitration administration fees and costs, and arbitrator(s)’ fees.

(e) No provision of this arbitration clause, nor the exercise of any rights hereunder, shall
limit the right of any party to: (1) judicially or non-judicially foreclose against any real or
personal property collateral or other security; (2) exercise self-help remedies, including but
not limited to repossession and setoff rights; or (3) obtain from a court having jurisdiction
thereover any provisional or ancillary remedies including but not limited to injunctive relief,
foreclosure, sequestration, attachment, replevin, garnishment, or the appointment of a
receiver. Such rights can be exercised at any time, before or after initiation of an
arbitration proceeding, except to the extent such action is contrary to the arbitration award.
The exercise of such rights shall not constitute a waiver of the right to submit any Dispute to
arbitration, and any claim or controversy related to the exercise of such rights shall be a
Dispute to be resolved under the provisions of this arbitration clause. Any party may initiate
arbitration with the Administrator. If any party desires to arbitrate a Dispute asserted
against such party in a complaint, counterclaim, cross-claim, or third-party complaint thereto,
or in an answer or other reply to any such pleading, such party must make an appropriate motion
to the trial court seeking to compel arbitration, which motion must be filed with the court
within 45 days of service of the pleading, or amendment thereto, setting forth such Dispute. If
arbitration is compelled after commencement of litigation of a Dispute, the party obtaining an
order compelling arbitration shall commence arbitration and pay the Administrator’s filing fees
and costs within 45 days of entry of such order. Failure to do so shall constitute an agreement
to proceed with litigation and waiver of the right to arbitrate. In any arbitration commenced
by a consumer regarding a consumer Dispute, Lender shall pay one half of the Administrator’s
filing fee, up to $250.

(f) Notwithstanding the applicability of any other law to this agreement, the arbitration
clause, or Related Agreements between or among the parties, the Federal Arbitration Act, 9
U.S.C. Section 1 et seq., shall apply to the construction and interpretation of this
arbitration clause. If any provision of this arbitration clause should be determined to be
unenforceable, all other provisions of this arbitration clause shall remain in full force and
effect.

Attorneys’ Fees; Expenses. Borrower agrees to pay upon demand all of Lender’s costs and
expenses, including Lender’s attorneys’ fees and Lender’s legal expenses, incurred in
connection with the enforcement of this Agreement. Lender may hire or pay someone else to help
enforce this Agreement, and Borrower shall pay the costs and expenses of such enforcement.
Costs and expenses include Lender’s attorneys’ fees and legal expenses whether or not there is
a lawsuit, including attorneys’ fees and legal expenses for bankruptcy proceedings (including
efforts to modify or vacate any automatic stay or injunction), appeals, and any anticipated
post-judgment collection services. However, Borrower will only pay attorneys’ fees of an
attorney not Lender’s salaried employee, to whom the matter is referred

 

 

					
	 
	 	BUSINESS LOAN AGREEMENT	 	 
	Loan No: 9001
	 	(Continued)
	 	Page 6

after Borrower’s default. Borrower also shall pay all court costs and such additional fees as
may be directed by the court.

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

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

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

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

Notices. Any notice required to be given under this Agreement shall be given in writing, and
shall be effective when actually delivered, when actually received by telefacsimile (unless
otherwise required by law), when deposited with a nationally recognized overnight courier, or,
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 Agreement. Any
party may change its address for notices under this Agreement by giving formal written notice
to the other parties, specifying that the purpose of the notice is to change the party’s
address. For notice purposes, Borrower agrees to keep Lender informed at all times of
Borrower’s current address. Unless otherwise provided or required by law, if there is more than
one Borrower, any notice given by Lender to any Borrower is deemed to be notice given to all
Borrowers.

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

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

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

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

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

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

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

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

Borrower. The word “Borrower” means READY MIX, INC., a Nevada corporation and includes all
co-signers and co-makers signing the Note and all their successors and assigns.

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

 

 

					
	 
	 	BUSINESS LOAN AGREEMENT	 	 
	Loan No: 9001
	 	(Continued)
	 	Page 7

Environmental Laws. The words “Environmental Laws” mean any and all state, federal and local
statutes, regulations and ordinances relating to the protection of human health or the
environment, including without limitation the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended, 42 U.S.C. Section 9601, et seq.
(“CERCLA”), the Superfund Amendments and Reauthorization Act of 1986, Pub. L. No. 99-499
(“SARA”), the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq., the
Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., or other applicable
state or federal laws, rules, or regulations adopted pursuant thereto.

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

GAAP. The word “GAAP” means generally accepted accounting principles.

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

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

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

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

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

Lender. The word “Lender” means NATIONAL BANK OF ARIZONA, a national banking association, its
successors and assigns.

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

Note. The word “Note” means Notes or Credit Agreements from Borrower to Lender together with
all renewals of, extensions of, modifications of, refinancings of, consolidations of and
substitutions for the Notes or Credit Agreements.

Permitted Liens. The words “Permitted Liens” mean (1) liens and security interests securing
Indebtedness owed by Borrower to Lender; (2) liens for taxes, assessments, or similar charges
either not yet due or being contested in good faith; (3) liens of materialmen, mechanics,
warehousemen, or carriers, or other like liens arising in the ordinary course of business and
securing obligations which are not yet delinquent; (4) purchase money liens or purchase money
security interests upon or in any property acquired or held by Borrower in the ordinary course
of business to secure indebtedness outstanding on the date of this Agreement or permitted to be
incurred under the paragraph of this Agreement titled “Indebtedness and Liens”; (5) liens and
security interests which, as of the date of this Agreement, have been disclosed to and approved
by the Lender in writing; and (6) those liens and security interests which in the aggregate
constitute an immaterial and insignificant monetary amount with respect to the net value of
Borrower’s assets.

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

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

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

BORROWER ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS BUSINESS LOAN AGREEMENT AND BORROWER
AGREES TO ITS TERMS. THIS BUSINESS LOAN AGREEMENT IS DATED MAY 26, 2006.

BORROWER:

READY MIX, INC., A NEVADA CORPORATION

	 	 	 	 	 
	By:

	 	/s/ Bradley E. Larson
 

BRADLEY E. LARSON, Chief Executive Officer of
	 	 
	 

	 	READY MIX, INC., a Nevada corporation

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