Document:

Exhibit 10.12

 

Commercial Contract

 

	 

 

	1. PARTIES AND PROPERTY:	Ka Bun Chan	("Buyer")

 

	agrees to buy and	EACO Corporation 	("Seller")

 

	agrees to sell the property as: Street Address:	13235 Cortez Blvd., Brooksville, FL 34613
	 

 

	Legal Description: 	John G Grubbs Commercial Tracts Lot 1A & 1B ORB
    869 PG 485
	 

 

	and the following Personal Property:	 
	   
	 
	(all collectively referred to as the "Property") on the terms and conditions set forth below.

 

	2. PURCHASE PRICE:	$	 1,800,000

 

	(a) Deposit held in escrow by	To Be Determined	$	
	 	("Escrow Agent") (checks are subject to actual and final collection)	 	 

 

	Escrow Agent's address:	 	Phone:	 

 

	(b) Additional deposit to be made to Escrow Agent within   5   days after
    Effective Date	$	 50,000

 

	(c) Additional deposits to be made to Escrow Agent within ____ days after Effective Date	$	

 

	(d) Total financing (see Paragraph 5)	$	 1,440,000

 

	(e) Other	 	$	

 

	(f) All deposits will be credited to the purchase price at closing. Balance to close,
    subject to adjustments and prorations, to be paid with locally drawn cashier's or official bank check(s) or wire transfer.	$	 310,000

 

3. TIME FOR ACCEPTANCE; EFFECTIVE DATE; COMPUTATION
OF TIME: Unless this offer is signed by Seller and Buyer and an executed copy delivered to all parties on or before        September
8, 2012        , this offer will be withdrawn and the Buyer's deposit, if any, will
be returned. The time for acceptance of any counter offer will be 3 days from the date the counter offer is delivered.
The "Effective Date" of this Contract is the date on which the last one of the Seller and Buyer has signed or
initialed and delivered this offer or the final counter offer. Calendar days will be used when computing time periods, except
time periods of 5 days or less. Time periods of 5 days or less will be computed without including Saturday, Sunday, or
national legal holidays. Any time period ending on a Saturday, Sunday, or national legal holiday will extend until 5:00 p.m.
of the next business day. Time is of the essence in this Contract.

 

4. CLOSING DATE AND LOCATION:

 

(a) Closing Date: This transaction will be closed on
       December 8, 2012        (Closing Date), unless specifically extended by other provisions of this Contract. The Closing Date will
prevail over all other time periods including, but not limited to, Financing and Due Dilligence periods. In the event insurance
underwriting is suspended on Closing Date and Buyer is unable to obtain property insurance, Buyer may postpone closing up to 5
days after the insurance underwriting suspension is lifted.

 

Buyer (C.K.B) (____) and Seller (M.B.) (____)
acknowledge receipt of a copy of this page, which is Page 1 of 8 Pages.

 

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Association of Realtors®    All Rights Reserved

 

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(b) Location: Closing will take place in _______________________
County, Florida. (If left blank, closing will take place in the county where the property is located,) Closing may be conducted
by mail or electronic means.

 

5. THIRD PARTY FINANCING:

 

BUYER’S OBLIGATION: Within ____ days (5 days
if left blank) after Effective Date, Buyer will apply for third party financing in an amount not to exceed    80   % of the
purchase price or $________________, with a fixed interest rate not to exceed   5.5  % per year with an initial variable
interest rate not to exceed ______%, with points or commitment or loan fees not to exceed   3  % of the principal amount,
for a term of   10   years, and amortized over   10   years, with additional terms as follows:

____________________________________________________________________________________________________________.

Buyer will timely provide any and all credit, employment, financial
and other information reasonably required by any lender. Buyer will use good faith and reasonable diligence to (i) obtain Loan
Approval within _____ days (45 days if left blank) from Effective Date (Loan Approval Date), (ii) satisfy terms and conditions
of the Loan Approval, and (iii) close
the loan. Buyer will keep Seller and Broker fully informed about loan application status and authorizes the
mortgage broker and lender to disclose all such information to Seller and Broker. Buyer will notify Seller immediately upon
obtaining financing or being rejected by a lender. CANCELLATION: If Buyer, after using good faith and reasonable diligence, fails
to obtain Loan Approval by Loan Approval Date, Buyer may within ____ days (3 days if left blank) deliver written notice to Seller
stating Buyer either waives this financing contingency or cancels this Contract. If Buyer does neither, then Seller may cancel
this Contract by delivering written notice to Buyer at any time thereafter. Unless this financing contingency has been waived,
this Contract shall remain subject to the satisfaction, by closing, of those conditions of Loan Approval related to the Property.
DEPOSIT(S) (for purposes of Paragraph 5 only): If Buyer has used good faith and reasonable diligence but does not obtain Loan
Approval by Loan Approval Date and thereafter either party elects to cancel this Contract as set forth above or the lender fails
or refuses to close on or before the Closing Date without fault on Buyer’s part, the Deposit(s) shall be returned to Buyer,
whereupon both parties will be released from all further obligations under this Contract, except for obligations stated herein
as surviving the termination of this Contract. If neither party elects to terminate this Contract as set forth above or Buyer fails
to use good faith or reasonable diligence as set forth above, Seller will be entitled to retain the Deposit(s) if the transaction
does not close.

 

6.
TITLE: Seller has the legal capacity to and will convey marketable title to the Property by x
statutory warranty deed  ̈
other _________________________________________, free of liens, easements and encumbrances of record or known to Seller, but
subject to property taxes for the year of closing; covenants, restrictions and public utility easements of record; existing
zoning and governmental regulations; and (list any other matters to which title will be subject) ________________________
_____________________________________________________________________;

provided there exists at closing no violation of the foregoing
and none of them prevents Buyer’s intended use of the Property as __________________________________________________________________________________________.

 

(a)
Evidence of Title: The party who pays the premium for the title insurance policy will select the closing agent and pay for
the title search and closing services. Seller will, at (check one) x
Seller’s  ̈
Buyer’s expense and within   15   days x
after Effective Date  ̈
or at least ___ days before Closing Date deliver to Buyer (check one)

x(i.)
a title insurance commitment by a Florida licensed title insurer setting forth those matters to be discharged by Seller at or before
Closing and, upon Buyer recording the deed, an owner’s policy in the amount of the purchase price for fee simple title subject
only to exceptions stated above. If Buyer is paying for the evidence of title and Seller has an owner’s policy, Seller will
deliver a copy to Buyer within 15 days after Effective Date.

 ̈
(ii.) an abstract of title, prepared or brought current by an existing abstract firm or certified as correct by an existing firm.
However, if such an abstract is not available to Seller, then a prior owner’s title policy acceptable to the proposed insurer
as a base for reissuance of coverage may be used. The prior policy will include copies of all policy exceptions and an update in
a format acceptable to Buyer from the policy effective date and certified to Buyer or Buyer’s closing agent together with copies of all documents
recited in the prior policy and in the update. If such an abstract or prior policy is not available to Seller then (i.) above will
be the evidence of title.

 

Buyer (C.K.B.) (___) and Seller (M.B.) (___)
acknowledge receipt of a copy of this page, which is Page 2 of 8 Pages.

 

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Association of Realtors®    All Rights Reserved

 

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(b) Title Examination: Buyer will,
within 15 days from receipt of the evidence of title deliver written notice to Seller of title defects. Title will be deemed
acceptable to Buyer if (1) Buyer fails to deliver proper notice of defects or (2) Buyer delivers proper written notice and
Seller cures the defects within ____ days from receipt of the notice (“Curative Period”). If the defects are
cured within the Curative Period, closing will occur within 10 days from receipt by Buyer of notice of such curing. Seller
may elect not to cure defects if Seller reasonably believes any defect cannot be cured within the Curative Period. If the
defects are not cured within the Curative Period, Buyer will have 10 days from receipt of notice of Seller’s inability
to cure the defects to elect whether to terminate this Contract or accept title subject to existing defects and close the
transaction without reduction in purchase price.

 

(c) Survey: (check applicable provisions
below)

x (i.)Seller
will, within   15   days from Effective Date, deliver to Buyer copies of prior surveys, plans, specifications,
and engineering documents, if any, and the following documents relevant to this transaction:

	Environmental

prepared for Seller or in Seller’s
possession, which show all currently existing structures. In the event this transaction does not close, all documents provided
by Seller will be returned to Seller within 10 days from the date this Contract is terminated.

x Buyer will, at
 ̈ Seller’s x Buyer’s expense
and within the time period allowed to deliver and examine title evidence, obtain a current certified survey of the Property from
a registered surveyor. If the survey reveals encroachments on the Property or that the improvements encroach on the lands of another,
 ̈ Buyer will accept the Property with existing encroachments x
such encroachments will constitute a title defect to be cured within the Curative period.

 

(d) Ingress and Egress: Seller warrants that
the Property presently has ingress and egress.

 

7. PROPERTY CONDITION: Seller will deliver the Property
to Buyer at the time agreed in its present “as is” condition, ordinary wear and tear excepted, and will maintain the
landscaping and grounds in a comparable condition. Seller makes no warranties other than marketability of title. In the event
that the condition of the Property has materially changed since the expiration of the Due Diligence Period, Buyer may elect to
terminate the Contract and receive a refund of any and all deposits paid, plus interest, if applicable. By accepting the Property
“as is”, Buyer waives all claims against Seller for any defects in the Property. (Check (a) or (b))

 

 ̈
(a) As Is: Buyer has inspected the Property or waives any right to inspect and accepts the Property in its “as is”
condition.

 

x
(b) Due Diligence Period: Buyer will, at Buyer’s expense and within   30   days
from Effective Date (“Due Diligence Period”), determine whether the Property is suitable, in Buyer’s sole
and absolute discretion, for Buyer’s intended use and development of the Property as specified in Paragraph 6. During
the Due Diligence Period, Buyer may conduct any tests, analyses, surveys and investigations (“Inspections”)
which Buyer deems necessary to determine to Buyer’s satisfaction the Property’s engineering, architectural,
environment properties; zoning and zoning restrictions; flood zone designation and restrictions; subdivision regulations;
soil and grade: availability of access to public roads, water, and other utilities; consistency with local, state and
regional growth management and comprehensive land use plans; availability of permits, government approvals and licenses;
compliance with American with Disabilities Act; absence of asbestos, soil and ground water contamination; and other
inspections that Buyer deems appropriate to determine the suitability of the Property for Buyer’s intended use and
development. Buyer will deliver written notice to Seller prior to the expiration of the Due Diligence Period of Buyer’s
determination of whether or not the Property is acceptable. Buyer’s failure to comply with this notice requirement will
constitute acceptance of the Property in its present “as is” condition. Seller grants to Buyer, its agents,
contractors and assigns, the right to enter the Property at any time during the Due Diligence Period for the purpose of
conducting inspections: provided, however, that Buyer, its agents, contractors and assigns enter the Property and conduct
Inspections at their own risk. Buyer will indemnify and hold Seller harmless from losses, damages, costs, claims and expenses
of any nature, including attorneys’ fees at all levels, and from liability to any person, arising from the conduct of
any and all Inspections or any work authorized by Buyer. Buyer will not engage in any activity that could result in a
mechanic’s lien being filed against the Property without Seller’s prior written consent. In the event this
transaction does not close, (1) Buyer will repair all damages to the Property resulting from the Inspections and return the
Property to the condition it was in prior to conduct of the Inspections, and (2) Buyer will, at Buyer’s expense release
to Seller all reports and other work generated as a result of the Inspections. Should Buyer deliver timely notice that the
Property is not acceptable, Seller agrees that Buyer’s deposit will be immediately returned to Buyer and the Contract
terminated.

 

Buyer (C.K.B.)(____)
and Seller (M.B.)(____) acknowledge receipt of a copy this page, which is page 3 of 8 pages.

 

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Association of Realtors®    All Rights Reserved

 

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(C) Walk-through Inspection: Buyer may, on
the day prior to closing or any other time mutually agreeable to the parties, conduct a final “walk-through” inspection
of the Property to determine compliance with this paragraph and to ensure that all Property is on the premises.

 

8. OPERATION OF PROPERTY DURING CONTRACT PERIOD: Seller
will continue to operate the Property and any business conducted on the Property in the manner operated prior to Contract and will
take no action that would adversely impact the Property, tenants, lenders or business, if any. Any changes, such as renting vacant
space, that materially affect the Property or Buyer’s intended use of the Property will be permitted x
only with Buyer’s consent  ̈ without Buyer’s consent.

 

9. CLOSING PROCEDURE: Unless otherwise agreed or stated
herein, closing procedure shall be in accordance with the norms where the Property is located.

 

(a) Possession and Occupancy: Seller will
deliver possession and occupancy of the Property to Buyer at closing. Seller will provide keys, remote controls, and any security/access
codes necessary to operate all locks, mailboxes, and security systems.

 

(b) Costs: Buyer will pay Buyer’s attorneys’
fees, taxes and recording fees on notes, mortgages and financing statements and recording fees for the deed. Seller will pay Seller’s
attorneys’ fees, taxes on the deed and recording fees for documents needed to cure title defects. If Seller is obligated
to discharge any encumbrance at or prior to closing and fails to do so, Buyer may use purchase proceeds to satisfy the encumbrances.

 

(c) Documents: Seller will provide the deed;
bill of sale; mechanic’s lien affidavit; originals of those assignable service and maintenance contracts that will be assumed
by Buyer after the Closing Date and letters to each service contractor from Seller advising each of them of the sale of the Property
and, if applicable, the transfer of its contract, and any assignable warranties or guarantees received or held by Seller from any
manufacturer, contractor, subcontractor, or material supplier in connection with the Property; current copies of the condominium
documents, if applicable; assignments of leases, updated rent roll; tenant and lender estoppels letters; tenant subordination,
non-disturbance and attornment agreements (SNDAs) required by the Buyer or Buyer’s lender; assignments of permits and licenses;
corrective instruments; and letters notifying tenants of the change in ownership/rental agent. If any tenant refuses to execute
an estoppels letter, Seller will certify that information regarding the tenant’s lease is correct. If Seller is an entity,
Seller will deliver a resolution of its Board of Directors authorizing the sale and delivery of the deed and certification by the
appropriate party certifying the resolution and setting forth facts showing the conveyance conforms to the requirements of local
law. Seller will transfer security deposits to Buyer. Buyer will provide the closing statement, mortgages and notes, security agreements,
and financing statements.

 

(d) Taxes and Prorations: Real estate taxes,
personal property taxes on any tangible personal property, bond payments assumed by Buyer, interest, rents (based on actual collected
rents), association dues, insurance premiums acceptable to Buyer, and operating expenses will be prorated through the day before
closing. If the amount of taxes for the current year cannot be ascertained, rates for the previous year will be used with due allowance
being made for improvements and exemptions. Any tax proration based on an estimate will, at request of either party, be readjusted
upon receipt of current year’s tax bill; this provision will survive closing.

 

(e) Special Assessment Liens: Certified, confirmed,
and ratified special assessment liens as of the Closing Date will be paid by Seller. If a certified, confirmed, and ratified special
assessment is payable in installments, Seller will pay all installments due and payable on or before the Closing Date, with any
installment for any period extending beyond the Closing Date prorated, and Buyer will assume all installments that become due and
payable after the Closing Date. Buyer will be responsible for all assessments of any kind which become due and owing after Closing
Date, unless an improvement is substantially completed as of Closing Date. If an improvement is substantially completed as of the
Closing Date but has not resulted in a lien before closing. Seller will pay the amount of the last estimate of the assessment.
This subsection applies to special assessment liens imposed by a public body and does not apply to condominium association special
assessments.

 

(f) Foreign Investment In Real Property Tax
Act (FIRPTA): If Seller is a “foreign person” as defined by FIRPTA, Seller and Buyer agree to comply with
Section 1445 of the Internal Revenue Code. Seller and Buyer will complete, execute, and deliver as directed any instrument,
affidavit, or statement reasonably necessary to comply with the FIRPTA requirements, including delivery of their respective
federal taxpayer identification numbers or Social Security Numbers to the closing agent. If Buyer does not pay sufficient
cash at closing to meet the withholding requirement, Seller will deliver to Buyer at closing the additional cash necessary to
satisfy the requirement.

 

Buyer (C.K.B.) (____) and Seller (M.B.) (____)
acknowledge receipt of a copy of this page, which is Page 4 of 8 Pages.

 

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10. ESCROW
AGENT: Seller and Buyer authorize Escrow Agent or Closing Agent (collectively “Agent”) to receive, deposit, and
hold funds and other property in escrow and, subject to collection, disburse them in accordance with the terms of this
Contract. The parties agree that Agent will not be liable to any person for misdelivery of escrowed
items to Seller or Buyer, unless the misdelivery is due to Agent’s willful breach of this Contract or gross negligence. If
Agent has doubt as to Agent's duties or obligations under this Contract, Agent may, at Agent's option, (a) hold the escrowed
items until the parties mutually agree to its disbursement or until a court of competent jurisdiction or arbitrator
determines the rights of the parties or (b) deposit the escrowed items with the clerk of the court having jurisdiction over
the matter and file an action in interpleader. Upon notifying the parties of such action, Agent will be released from all liability
except for the duty to account for items previously delivered out of escrow. If Agent
is a licensed real estate broker, Agent will comply with Chapter 475, Florida Statutes. In any suit in which Agent
interpleads the escrowed items or is made a party because of acting as Agent hereunder, Agent will recover reasonable
attorney's fees and costs incurred, with these amounts to be paid from and out of the escrowed items and charged and awarded
as court costs in favor of the prevailing party.

 

11. CURE
PERIOD: Prior to any claim for default being made, a party will
have an opportunity to cure any alleged default. If a party fails to comply with any provision of this Contract, the other
party will deliver written notice to the non-complying party specifying the non-compliance. The non-complying party will have
___ days (5 days if left blank) after delivery of such notice to cure the non-compliance. Notice and cure shall not apply to
failure to close.

 

12. RETURN OF DEPOSIT: Unless otherwise specified in the
Contract, in the event any condition of this Contract is not met and Buyer has timely given any required notice regarding the condition
having not been met, Buyer's deposit will be returned in accordance with applicable Florida Laws and regulations.

 

13. DEFAULT:

 

(a) In the event the sale is not closed due to any
default or failure on the part of Seller other than failure to make the title marketable after diligent effort, Buyer may either
(1) receive a refund of Buyer's deposit(s) or (2)
seek specific performance. If Buyer elects a deposit refund, Seller will be liable to Broker for the full amount of the
brokerage fee.

 

(b) In the event the sale is not closed due to any
default or failure on the part of Buyer, Seller may either (1) retain all deposit(s) paid or agreed to be paid by Buyer as agreed
upon liquidated damages, consideration for the execution of this Contract, and in full settlement of
any claims, upon which this Contract will terminate or (2)
seek specific performance. If Seller retains the deposit, Seller will pay the Brokers named in Paragraph 20
fifty percent of all forfeited deposits retained by Seller (to be split equally among the Brokers) up to the full amount
of the brokerage fee. If Buyer fails to timely place a deposit as required by this Contract, Seller may either (1)
terminate the Contract and seek the remedy outlined in this subparagraph or (2) proceed with the Contract without waiving any remedy
for Buyer's default.

 

14. ATTORNEY'S FEES AND COSTS: In any claim or controversy
arising out of or relating to this Contract, the prevailing party, which
for purposes of this provision will include Buyer, Seller and Broker, will be awarded reasonable attorneys' fees, costs, and expenses.

 

15. NOTICES: All notices will be in writing and may be
delivered by mail, overnight courier, personal delivery, or electronic means. Parties agree to send all notices to addresses specified
on the signature page(s). Any notice, document, or item given by or delivered to an attorney or real estate licensee (including
a transaction broker) representing a party will be as effective as if given
by or delivered to that party.

 

16. DISCLOSURES:

 

(a) Commercial Real Estate Sales Commission Lien
Act: The Florida Commercial Real Estate Sales Commission Lien Act provides that a broker has a lien upon the owner's net proceeds
from the sale of commercial real estate for any commission earned by the broker under a brokerage agreement. The lien upon the
owner's net proceeds is a lien upon personal property which attaches to the owner's net proceeds and does not attach to any interest
in real property. This lien right cannot be waived before the commission is earned.

 

Buyer (C.K.B.) (___) and Seller (M.B.) (___)
acknowledge receipt of a copy of this page, which is Page 5 of 8 Pages.

 

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(b) Special Assessment Liens Imposed by Public
Body: The Property may be subject to unpaid special assessment lien(s) imposed by a public body. (A public body includes a
Community Development District.) Such liens, if any, shall be paid as set forth in Paragraph 9(e).

 

(c) Radon Gas: Radon is a naturally occurring
radioactive gas that, when it has accumulated in a building in sufficient quantities, may present health risks to persons who
are exposed to it over time. Levels of radon that exceed federal and state guidelines have been found in buildings in Florida.
Additional information regarding radon and radon testing may be obtained from your county public health unit.

 

(d) Energy-Efficiency Rating Information:
Buyer acknowledges receipt of the information brochure required by Section 553.996, Florida Statutes.

 

17. RISK OF LOSS:

 

(a) If, after the Effective Date and before closing,
the Property is damaged by fire or other casualty, Seller will bear the risk of loss and Buyer may cancel this Contract without
liability and the deposit(s) will be returned to Buyer. Alternatively, Buyer will have the option of purchasing the Property at
the agreed upon purchase price and Seller will credit the deductible, if any and transfer to Buyer at closing any insurance proceeds,
or Seller's claim to any insurance proceeds payable for the damage. Seller will cooperate with and assist Buyer in collecting any
such proceeds. Seller shall not settle any insurance claim for damage caused by casualty without the consent of the Buyer.

 

(b) If, after the Effective Date and before closing,
any part of the Property is taken in condemnation or under the right of eminent domain, or proceedings for such taking
will be pending or threatened. Buyer may cancel this Contract without liability and the deposit(s) will be returned to Buyer.
Alternatively, Buyer will have the option of purchasing what is left of the Property at the agreed upon purchase price and Seller
will transfer to the Buyer at closing the proceeds of any award, or Seller's claim to any award payable for the taking. Seller
will cooperate with and assist Buyer in collecting any such award.

 

18. ASSIGNABILITY; PERSONS BOUND: This Contract may be
assigned to a related entity, and otherwise x is not assignable  ̈
is assignable. If this Contract may be assigned, Buyer shall deliver a copy of the assignment agreement to the Seller at least
5 days prior to Closing. The terms "Buyer," "Seller" and "Broker" may be singular or plural. This
Contract is binding upon Buyer. Seller and their heirs, personal representatives, successors and assigns (if assignment is permitted).

 

19. MISCELLANEOUS: The terms of this Contract constitute
the entire agreement between Buyer and Seller. Modifications of this Contract will not be binding unless in writing, signed and
delivered by the party to be bound. Signatures, initials, documents referenced in this Contract, counterparts and written modifications
communicated electronically or on paper will be acceptable for all purposes, including delivery, and will be binding. Handwritten
or typewritten terms inserted in or attached to this Contract prevail over preprinted terms. If any provision of this Contract
is or becomes invalid or unenforceable, all remaining provisions will continue to be fully effective. This Contract will be construed
under Florida law and will not be recorded in any public records.

 

20. BROKERS: Neither Seller nor
Buyer has used the services of, or for any other reason owes compensation to, a licensed real estate Broker other than:

 

	(a) Seller's Broker:	 	 
	 	(Company Name)	(Licensee)
	 	 	 
	(Address, Telephone, Fax, E-mail)
	 who  ̈ is a single agent  ̈
    is a transaction broker  ̈ has no brokerage relationship and who will
    be compensated by  ̈ Seller  ̈
    Buyer  ̈ both parties pursuant to  ̈
    a listing agreement  ̈ other (specify) _____________________________________________________________________
	 

 

Buyer (C.K.B.) (___) and Seller (M.B.) (___)
acknowledge receipt of a copy of this page, which is Page 6 of 8 Pages.

 

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	(b) Buyer's Broker:	Carlino Commercial Group, Inc.	Josephine Yiping Wang
	 	(Company Name)	(Licensee)

 

	(Address, Telephone, Fax, E-mail)
	who x is a single agent  ̈ is a transaction broker  ̈ has no brokerage relationship and who will be compensated by  ̈ Seller’s Broker x Seller  ̈ Buyer  ̈ both parties pursuant to  ̈ an MLS offer of compensation x other (specify)
	3% of gross purchase price.

(collectively referred to as "Broker")
in connection with any act relating to the Property, including but not limited to inquiries, introductions, consultations, and
negotiations resulting in this transaction. Seller and Buyer agree to indemnify and hold Broker harmless from and against losses,
damages, costs and expenses of any kind, including reasonable attorneys' fees at all levels, and from liability to any person,
arising from (1) compensation claimed which is inconsistent with the representation in this Paragraph, (2) enforcement action to
collect a brokerage fee pursuant to Paragraph 10, (3) any duty accepted by Broker at the request of Seller or Buyer, which is beyond
the scope of services regulated by Chapter 475, Florida Statutes, as amended, or (4) recommendations of or services provided and
expenses incurred by any third party whom Broker refers, recommends, or retains for or on behalf of Seller or Buyer.

 

21.  OPTIONAL CLAUSES:
(Check if any of the following clauses are applicable and are attached as an addendum to this Contract):

	 	 ̈ Arbitration	 ̈ Seller Warranty	 ̈  Existing Mortgage
	 	 ̈ Section 1031 Exchange	 ̈ Coastal Construction Control Line  	 ̈ Buyer's Attorney Approval
	 	 ̈ Property Inspection and Repair  	 ̈ Flood Area Hazard Zone	 ̈ Seller's Attorney Approval
	 	 ̈ Seller Representations	 ̈ Seller Financing	 ̈ Other	 

 

22.  ADDITIONAL TERMS:

	 
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 
	 

 

THIS IS INTENDED TO BE A LEGALLY BINDING CONTRACT. IF NOT FULLY
UNDERSTOOD, SEEK THE ADVICE OF AN ATTORNEY PRIOR TO SIGNING. BROKER ADVISES BUYER AND SELLER TO VERIFY ALL FACTS AND REPRESENTATIONS
THAT ARE IMPORTANT TO THEM AND TO CONSULT AN APPROPRIATE PROFESSIONAL FOR LEGAL ADVICE (FOR EXAMPLE, INTERPRETING CONTRACTS, DETERMINING
THE EFFECT OF LAWS ON THE PROPERTY AND TRANSACTION, STATUS OF TITLE, FOREIGN INVESTOR REPORTING REQUIREMENTS, ETC.) AND FOR TAX,
PROPERTY CONDITION, ENVIRONMENTAL AND OTHER ADVICE. BUYER ACKNOWLEDGES THAT BROKER DOES NOT OCCUPY THE PROPERTY AND THAT ALL REPRESENTATIONS
(ORAL, WRITTEN OR OTHERWISE) BY BROKER ARE BASED ON SELLER REPRESENTATIONS OR PUBLIC RECORDS UNLESS BROKER INDICATES PERSONAL VERIFICATION
OF THE REPRESENTATION. BUYER AGREES TO RELY SOLELY ON SELLER, PROFESSIONAL INSPECTORS AND GOVERNMENTAL AGENCIES FOR VERIFICATION
OF THE PROPERTY CONDITION, SQUARE FOOTAGE AND FACTS THAT MATERIALLY AFFECT PROPERTY VALUE.

 

Buyer (C.K.B.) (____) and seller (M.B.)
(_____) acknowledge receipt of a copy of this page, which is Page 7 of 8 Pages.

 

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Association of Realtors®    All Rights Reserved

 

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Each person signing this Contract on behalf of a party that
is a business entity represents and warrants to the other party that such signatory has full power and authority to enter into
and perform this Contract in accordance with its terms and each person executing this Contract and other documents on behalf of
such party has been duly authorized to do so.

 

	/s/ Ka Bun Chan	 	Date:	8/30/12
	Ka Bun Chan	 	 
	 	 	 
	Ka Bun Chan	 	Tax ID No:	 
	(Typed or Printed Name of Buyer)	 	 
	 	 	 
	Title:	 	 	Telephone:	 
	 	 	 
	 	 	Date:	 
	 	 	 
	 	 	Tax ID No:	 
	(Typed or Printed Name of Buyer)	 	 
	 	 	 
	Title:	 	 	Telephone:	 
	 	 	 
	Buyer's Address for purpose of notice:	 
	 	 	 
	Facsimile:	 	 	Email:	 
	 	 	 
	/s/ Michael Bains	 	Date:	9/26/12
	 	 	 
	Michael Bains - Eaco	 	Tax ID No:	 
	(Typed or Printed Name of Seller)	 	 
	 	 	 
	Title:	Controller	 	Telephone:	714-690-2901 x 3331
	 	 	 
	 	 	Date:	 
	 	 	 
	 	 	Tax ID No:	 
	(Typed or Printed Name of Seller)	 	 
	 	 	 
	Title:	 	 	Telephone:	 
	 	 	 
	Seller's Address for purpose of notice:	1500 N. Lakeview Ave., Anaheim, Ca 92807
	 	 	 
	Facsimile:	(714) 876-2407	 	Email:	mbains@biscoind.com
	 	 	 	 	 	 	 	 

The Florida Association of REALTORS©
 makes no representation as to the legal validity or adequacy of any
provision of this form in any specific transaction. This standardized form should
not be used in complex transactions or with extensive riders or additions. This form is available for use by the entire real estate
industry and is not intended to identify the user as a REALTOR©. REALTORS© is a registered collective
membership mark which may be used only by real estate licensees who are members of the NATIONAL ASSOCIATION OF REALTORS©
and who subscribe to its Code of Ethics.

The copyright laws of the United States (17 U.S. Code)
forbid the unauthorized reproduction of this form by any means including facsimile or computerized forms.

 

Buyer (C.K.B.) (_____) and Seller
(M.B.) (___) acknowledge receipt of a copy of this page, which is Page 8 of 8 Pages.

 

CC-4    Rev. 12/10    ©2010    Florida
Association of Realtors®    All Rights Reserved

 

formsimplicity

 

    	 

    	 

    
 

COUNTER OFFER No. 1

 

This is Counter Offer No. 1 to the Commercial
Contract dated August 30, 2012 (“Offer”) on property located at 13235 Cortez Blvd., Brooksville, FL 34613 (“Property”)
by and between EACO Corporation (“Seller”) and Ka Bun Chan (“Buyer”).

 

The terms and conditions of the above referenced
Offer are accepted subject to the following:

 

2. Purchase Price to be $1,825,000.

 

3. In Paragraph 2(a), the sum of $50,000
by wire transfer or other immediately available funds to be deposited into escrow upon the opening of escrow. Said deposit shall
be applicable to the Purchase Price.

 

4. Closing shall occur on January 8, 2013
(the “Closing Date”), unless the parties agree to an earlier Closing Date in writing. The Closing Date shall not be
extended by any other provision(s) of the Offer.

 

5. Buyer is currently the Tenant in possession
of the Property under a written lease agreement dated as of January 9, 2008 (“Lease”). Buyer shall continue to abide
by all terms and conditions of the Lease through the close of escrow. In this regard, Buyer’s Due Diligence Period shall
be thirty (30) days. Seller shall have no obligations to operate and/or maintain the Property except for those obligations set
forth under the Lease.

 

6. As to the Risk of Loss, Seller’s
cooperation therein, shall be at no cost or expense to Seller.

 

7. Buyer agrees that in the event Buyer fails
to consummate the purchase of the Property on or before the Closing Date, that notwithstanding anything to the contrary contained
within the Lease, any and all Options to Renew the Lease are hereby terminated and of no force or effect, including Buyer’s
alleged exercise of Option to Renew dated August 20, 2012. Buyer agrees that in the event Buyer fails to purchase the Property
on or before the Closing Date, that notwithstanding anything contrary contained within the Lease, that the Lease shall terminate
and Buyer’s right to possession of the Subject Property shall expire as of January 8, 2013 and Buyer agrees to vacate the
Subject Property no later than January 9, 2013.

 

This Counter Offer No. 1 shall be deemed
revoked and of no force or effect unless this Counter Offer is signed by the Buyer and a copy of the signed Counter Offer No.
1 is personally received by the person making this Counter Offer by 5:00 PM on _______, 2012.

 

    	 

    	 

    

 

Seller makes this Counter Offer No.1 on the
terms and conditions above.

 

Seller: EACO Corporation

 

	By: 	/s/ Michael Bains
	 	 	 
	 	Its:	Controller

 

Buyer acknowledges receipt of Counter Offer
No. 1 and accepts the terms and conditions of Counter Offer No. 1.

 

	Buyer:	/s/ Ka Bun Chan
	 	Ka Bun Chan

 

    	 

    	 

    

  

Addendum to Commercial Contract

 

This Addendum (the
“Addendum”) to Commercial Contract is dated October 2, 2012 and is by and between EACO Corporation (“Seller”)
and Ka Bun Chan (“Buyer”).

 

WHEREAS, Buyer
and Seller entered into that certain Commercial Contract (“Contract”) which has an Effective Date of September 26,
2012, for the sale and purchase of that certain real property located at 13235 Cortez Boulevard, Brooksville, Florida;
and

 

WHEREAS, Buyer and Seller
wish to modify the Contract in certain limited respects.

 

NOW THEREFORE, in consideration
of the recitals set forth above, and other good and valuable consideration, the parties, intending to be bound, do hereby agree
as follows:

 

1.    Incorporation
of Recitals; Capitalized Terms. Buyer and Seller agree that the above described recitals are true and correct and that the
Contract is in full force and effect as of the date hereof. Whenever the terms of this Addendum are inconsistent with the terms
of the Contract, the terms of this Addendum shall be deemed to supersede and amend the terms of the Contract. Except as otherwise
specifically provided in this Addendum, capitalized terms herein which are defined in the Contract shall have the same meaning
herein as in the Contract.

 

2.   Escrow Agent.
The parties agree that the Escrow Agent shall be McGuireWoods LLP. The Deposit shall be deposited by the Escrow Agent in a non-interest
bearing deposit account at Bank of America and the proceeds held and disbursed in accordance with the terms of the Contract.

 

The parties agree jointly to defend (by
attorneys selected by Escrow Agent), indemnify and hold harmless Escrow Agent against and from any claim, judgment, loss, liability,
cost or expense resulting from any dispute or litigation arising out of or concerning Escrow Agent’s duties or services hereunder.
This indemnity includes, without limitation, disbursements and reasonable attorneys’ fees either paid to retain attorneys or representing
the fair value of legal services rendered by Escrow Agent to itself.

 

Escrow Agent shall not be liable for any
error in judgment or for any act done or step taken or omitted in good faith, or for any mistake of fact or law, except for Escrow
Agent’s own gross negligence or willful misconduct. Buyer and Seller acknowledge and agree that (a) the amount of the Deposit may
exceed the amount of FDIC insurance coverage applicable to the Deposit in the deposit account in which the Deposit is deposited,
(b) Escrow Agent has deposited the Deposit in the deposit account at the direction of Buyer and Seller and has not exercised (and
does not have) investment discretion over the Deposit, and (c) the Escrow Agent shall have no liability to Buyer, Seller or any
other person or entity in the event of any diminution in value of, or failure of the bank in which the Deposit is deposited to
pay, any deposit account in which the Deposit or any part thereof is deposited at any time.

 

    	 

    	 

    

 

The parties acknowledge that Escrow Agent
is merely a stakeholder. Upon payment of the Deposit pursuant to the terms of the Contract, Escrow Agent shall be fully released
from all liability and obligations with respect to the Deposit.

 

It is acknowledged that Escrow Agent is
the attorney for Seller and that Escrow Agent shall be entitled to represent such party in any lawsuit.

 

3. No Further Modifications.
Except as expressly modified and amended herein, all the terms and provisions of the Contract shall remain in full force and effect.

 

IN WITNESS WHEREOF, the parties have executed
this Addendum as of the day and year first above written.

 

	SELLER:	 	BUYER:
	 	 	 
	EACO Corporation	 	 
	 	 	/s/ Ka Bun Chan
	By:	/s/ Michael Bains	 	Ka Bun Chan
	Name:	Michael Bains	 	 
	Title:	Controller	 	 
	 	 	 
	ACCEPTED AND AGREED TO in its	 	
	capacity as the Escrow Agent:	 	 
	 	 	 
	McGuireWoods LLP	 	 
	 	 	 
	By:	/s/ Kenneth M Keefe JR	 	 
	Name:	Kenneth M Keefe JR	 	 
	Title:	CounselExhibit 10.13

 

BUSINESS
LOAN AGREEMENT 

 

	Principal	Loan Date	Maturity	Loan No	Call / Coll	Account	Officer	Initials
	$10,000,000.00	06-01-2007	04-01-2008	155354101	CLS 07 / 240	600714	765	/s/
	References in the shaded area are for Lender’s use only and do not limit the applicability of this document to any particular loan or item. Any item above containing “***” has been omitted due to text length limitations.

 

	Borrower:	BISCO INDUSTRIES, INC.	Lender:	COMMUNITY BANK
	 	1500 NORTH LAKEVIEW AVENUE	 	ANAHEIM BRANCH
	 	ANAHEIM, CA 92807	 	1750 S. STATE COLLEGE BLVD.
	 	 	 	ANAHEIM, CA 92806
	 	 	 	(800) 788-9999
	 	 	 	 

 

THIS BUSINESS LOAN AGREEMENT dated June 1, 2007, is
made and executed between BISCO INDUSTRIES, INC. (“Borrower”) and COMMUNITY BANK (“Lender”) on the following
terms and conditions. Borrower has received prior commercial loans from Lender or has applied to Lender for a commercial loan or
loans or other financial accommodations, including those which may be described on any exhibit or schedule attached to this Agreement
(“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. This Agreement shall apply to any and all
present and future loans, loan advances, extension of credit, financial accommodations and other agreements and undertakings of
every nature and kind that may be entered into by and between Borrower and Lender now and in the future. 

 

TERM. This Agreement shall be effective as of June 1,
2007, and shall continue in full force and effect until such time as all of Borrower’s Loans in favor of Lender have been
paid in full, including principal, interest, costs, expenses, attorneys’ fees, and other fees and charges, or until such
time as the parties may agree in writing to terminate this Agreement.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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, do not require the consent or approval of any other person, regulatory authority, or governmental body, 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. Borrower has the power and authority
to enter into the Note and the Related Documents and to grant collateral as security for the Loan. Borrower has the further power
and authority to own and to hold all of Borrower’s assets and properties, and to carry on Borrower’s business as presently
conducted.

 

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

 

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

 

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

 

Hazardous Substances. Except as disclosed
to and acknowledged by Lender in writing. Borrower represents and warrants that: (1) During the period of Borrower’s
ownership of the Collateral, there has been no use, generation, manufacture, storage, treatment, disposal, release or threatened
release of any Hazardous Substance by any person on, under, about or from any of the Collateral. (2) Borrower has no knowledge
of, or reason to believe that there has been (a) any breach or violation of any Environmental Laws; (b) any use, generation,
manufacture, storage, treatment, disposal, release or threatened release of any Hazardous Substance on, under, about or from the
Collateral by any prior owners or occupants of any of the Collateral; or (c) any actual or threatened litigation or claims
of any kind by any person relating to such matters. (3) Neither Borrower nor any tenant contractor, agent or other authorized
user of any of the Collateral shall use, generate, manufacture, store, treat, dispose of or release any Hazardous Substance on,
under, about or from any of the Collateral; and any such activity shall be conducted in compliance with all applicable federal,
state, and local laws, regulations, and ordinances, including without limitation all Environmental Laws. Borrower authorizes Lender
and its agents to enter upon the Collateral to make such inspections and tests as Lender may deem appropriate to determine compliance
of the Collateral with this section of the Agreement. Any inspections or tests made by Lender shall be at Borrower’s expense
and for Lender’s purposes only and shall not be construed to create any responsibility or liability on the part of Lender
to Borrower or to any other person. The representations and warranties contained herein are based on Borrower’s due diligence
in investigating the Collateral for hazardous waste and Hazardous Substances. Borrower hereby (1) releases and waives any
future claims against Lender for indemnity or contribution in the event Borrower becomes liable for cleanup or other costs under
any such laws, and (2) agrees to indemnify 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. 

 

    	 

    	 

    
 

		BUSINESS LOAN AGREEMENT	
	Loan No: 155354101	(Continued)	 

 

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.

 

Commercial Purposes. Borrower intends to
use the Loan proceeds solely for business or commercially related purposes.

 

Employee Benefit Plans. Each employee benefit
plan as to which Borrower may have any liability complies in all material respects with all applicable requirements of law and
regulations, and (1) no Reportable Event nor Prohibited Transaction (as defined in ERISA) has occurred with respect to any
such plan, (2) Borrower has not withdrawn from any such plan or initiated steps to do so, (3) no steps have been taken
to terminate any such plan or to appoint a trustee to administer such a plan, and (4) there are no unfunded liabilities other
than those previously disclosed to Lender in writing.

 

Investment Company Act. Borrower is not an
“investment company” or a company “controlled” by an “investment company”, within the meaning
of the Investment Company Act of 1940, as amended.

 

Public Utility Holding Company Act. Borrower
is not a “holding company”, or a “subsidiary company” of a “holding company”, or an “affiliate”
of a “holding company” or of a “subsidiary company” of a “holding company”, within the meaning
of the Public Utility Holding Company Act of 1935, as amended.

 

Regulations T and U. Borrower is not engaged
principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying
margin stock (within the meaning of Regulations T and U of the Board of Governors of the Federal Reserve System).

 

Information. All information previously furnished
or which is now being furnished by Borrower to Lender for the purposes of or in connection with this Agreement or any transaction
contemplated by this Agreement is, and all information furnished by or on behalf of Borrower to Lender in the future will be, true
and accurate in every material respect on the date as of which such information is dated or certified; and no such information
is or will be incomplete by omitting to state any material fact the omission of which would cause the information to be misleading.

 

Claims and Defenses. There are no defenses
or counterclaims, offsets or other adverse claims, demands or actions of any kind, personal or otherwise, that Borrower, any Grantor,
or any Guarantor could assert with respect to the Note, Loan, this Agreement, or the Related Documents.

 

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

 

Repayment. Repay the Loan in accordance with
its terms and the terms of this Agreement.

 

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. In addition,
Borrower shall provide Lender with written notice of the occurrence of any Event of Default, the occurrence of any Reportable Event
under, or the institution of steps by Borrower to withdraw from, or the institution of any steps to terminate, any employee benefit
plan as to which Borrower may have any liability.

 

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

 

Financial Statements. Furnish Lender with
the following:

 

Additional Requirements. Personal:
Borrower shall furnish to Lender as soon as available and in any event within fifteen (15) days after filing, personal federal
income tax returns and supporting schedules. Borrower shall furnish to Lender personal financial statement annually.

 

Tax Returns. But in no event later than thirty
(30) days after the applicable filing date for the tax reporting period ended. Borrower’s Corporate annual tax return
to be obtained on a best efforts basis.

 

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 Consolidated
balance sheet and income statement for the year ended, audited with an unqualified opinion, by a certified public accountant satisfactory
to Lender.

 

Interim Statements. As soon as available
but in no event later than forty-five (45) days after the end of each quarter, Borrower’s Consolidated financial statements
for the period ended, prepared by Borrower.

 

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.

 

Financial Covenants and Ratios. Comply with
the following covenants and ratios:

 

Working Capital Requirements. Borrower shall
comply with the following working capital ratio requirements:

 

Current Ratio. Maintain a Current Ratio in
excess of 1.250 to 1.000. The term “Current Ratio” means Borrower’s total Current Assets divided by Borrowers
total Current Liabilities. This liquidity ratio will be evaluated as of Quarter-end within 45 days.

 

Quick Ratio. Maintain a Quick Ratio in excess
of 0.500 to 1.000. The term “Quick Ratio” means Borrower’s Cash & Equivalent plus Borrower’s
net Trade Receivables divided by Borrower’s total Current Liabilities. This liquidity ratio will be evaluated as of quarterly
on a consolidated basis within 45 days.

 

Other Requirements. Debt to Effective Tangible
Net Worth. Maintain a maximum Debt to Effective Tangible Net Worth Ratio of 1.75 to 1.00. The term “Debt to Effective
Tangible Net Worth” means Borrower’s total liabilities, less amounts subordinated to Lender, as evidenced by a subordination
agreement. If any divided by Borrower’s Effective Tangible Net Worth. The term “Effective Tangible Net Worth”
means Borrower’s total assets, less intangibles [i.e., goodwill, trademarks, patents, copyrights, organizational expenses,
and similar intangible items, but including leaseholds and leasehold improvements], less amounts due from officers, partners, stockholders,
directors, affiliates, and subsidiaries, less total liabilities, plus amounts subordinated to Lender, as evidenced by a subordination
agreement, if any. This leverage ratio to be measured using GAAP accounting as of each quarter-end plus 45 days.

 

Effective Tangible Net
Worth. Maintain an Effective Tangible Net Worth of $11,000,000.00. The term “Effective Tangible Net Worth”
means Borrower’s total assets, less intangibles [i.e., goodwill, trademarks, patents, copyrights, organizational
expenses, and similar intangible items, but including leaseholds and leasehold improvements], less amounts due from officers,
partners, stockholders, directors, affiliates, and subsidiaries, less total liabilities, plus amounts subordinated to Lender,
as evidenced by a subordination agreement, if any. This leverage to be measured using GAAP accounting as of each quarter-end
plus 45 days.

 

Accounts Receivable audit to be performed annually
at the Borrower’s expense.

 

Brokerage Statements for marketable securities to
be submitted within forty-five (45) days of the end of each fiscal quarter.

 

Minimum current assets of $15,000,000.00 on a consolidated
basis measured quarterly. Per GAAP, investments in Data I/O are to continue to be shown as non-current assets.

 

Maximum of $1,000,000.00 of the liability of the
margin account for the trading securities.

 

Borrower is not to make any new long-term investments
as defined by GAAP, inclusive of Data I/O, in excess of $100,000.00 without prior approval of Lender.

 

Except as provided above, all computations made
to determine compliance with the requirements contained in this paragraph shall be made in accordance with generally accepted accounting
principles, applied on a consistent basis, and certified by Borrower as being true and correct.

 

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 thirty (30) 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.

 

    	 

    	 

    

 

		BUSINESS LOAN AGREEMENT	
	Loan No: 155354101	(Continued)	 

 

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

 

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

 

	 	Name of Guarantor	 	
        Amount 

	 	GLEN F. CElLEY	 	Unlimited

 

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

 

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

 

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

 

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, and in all other loan agreements now or in the future existing between Borrower and
any other party. Borrower shall notify Lender immediately in writing of any default in connection with any agreement.

 

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

 

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

 

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

 

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.

 

Change of Location. Immediately notify Lender in writing
of any additions to or changes in the location of Borrower’s businesses.

 

Title to Assets and Property. Maintain good and marketable
title to all of Borrower’s assets and properties.

 

Notice of Default, Litigation and ERISA Matters. Forthwith
upon learning of the occurrence of any of the following, Borrower shall provide Lender with written notice thereof, describing
the same and the steps being taken by Borrower with respect thereto: (1) the occurrence of any Event of Default, or (2) the
institution of, or any adverse determination in, any litigation, arbitration proceeding or governmental proceeding, or (3) the
occurrence of a Reportable Event under, or the institution of steps by Borrower to withdraw from, or the institution of any steps
to terminate, any employee benefit plan as to which Borrower may have any liability.

 

Other Information. From time to time Borrower will provide
Lender with such other information as Lender may reasonably request

 

Employee Benefit Plans. So long as this Agreement remains
in effect, Borrower will maintain each employee benefit plan as to which Borrower may have any liability, in compliance with all
applicable requirements of law and regulations.

 

Compliance Certificates. Unless waived in writing by
Lender, provide Lender within thirty (30) days after the end of each (This section is hereby waived by Lender and Borrower
is notified.), with a certificate executed by Borrower’s chief financial officer, or other officer or person acceptable
to Lender, certifying that the representations and warranties set forth in this Agreement are true and correct as of the date of
the certificate and further certifying that, as of the date of the certificate, no Event of Default exists under this Agreement.

 

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

 

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

 

LENDER’S EXPENDITURES. If any action or proceeding
is commenced that would materially affect Lender’s interest in the Collateral or 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, 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) 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.

 

    	 

    	 

    

 

		BUSINESS LOAN AGREEMENT	
	Loan No: 155354101	(Continued)	 

 

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

 

Agreements. 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, 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.

 

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.

 

False Statements. Any warranty, representation or statement
made or furnished to Lender by Borrower or on Borrower’s behalf, or made by Guarantor, under this Agreement or the Related
Documents in connection with the obtaining of the Loan evidenced by the Note or any security document directly or indirectly securing
repayment of the Note 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.

 

Execution; Attachment. Any execution or attachment is
levied against the Collateral, and such execution or attachment is not set aside, discharged or stayed within thirty (30) days
after the same is levied.

 

Change in Zoning or Public Restriction. Any change in
any zoning ordinance or regulation or any other public restriction is enacted, adopted or implemented, that limits or defines the
uses which may be made of the Collateral such that the present or intended use of the Collateral, as specified in the Related Documents,
would be in violation of such zoning ordinance or regulation or public restriction, as changed.

 

Default Under Other Lien Documents. A default occurs
under any other mortgage, deed of trust or security agreement covering all or any portion of the Collateral.

 

Judgment. Unless adequately covered by insurance in the
opinion of Lender, the entry of a final judgment for the payment of money involving more than ten thousand dollars ($10,000.00)
against Borrower and the failure by Borrower to discharge the same, or cause it to be discharged, or bonded off to Lender’s
satisfaction, within thirty (30) days from the date of the order, decree or process under which or pursuant to which such
judgment was entered.

 

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.

 

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

 

Right to Cure. If any default, other than a default on
Indebtedness, is curable and 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.

 

ADDITIONAL DOCUMENTS. Borrower shall provide Lender with
the following additional documents:

 

Corporate Resolution. Borrower has provided or will provide
Lender with a certified copy of resolutions properly adopted by Borrower’s Board of Directors, and certified by Borrower’s
corporate secretary, assistant secretary, or other authorized officer, under which Borrower’s Board of Directors authorized
one or more designated officers or employees to execute this Agreement, the Note and any and all Security Agreements directly or
indirectly securing repayment of the same, and to consummate the borrowings and other transactions as contemplated under this Agreement,
and to consent to the remedies following any default by Borrower as provided in this Agreement and in any Security Agreements.

 

Opinion of Counsel. When required by Lender, Borrower
has provided or will provide Lender with an opinion of Borrower’s counsel certifying to and that: (1) Borrower’s
Note, any Security Agreements and this Agreement constitute valid and binding obligations on Borrower’s part that are enforceable
in accordance with their respective terms; (2) Borrower is validly existing and in good standing; (3) Borrower has authority
to enter into this Agreement and to consummate the transactions contemplated under this Agreement; and (4) such other matters
as may have been requested by Lender or by Lender’s counsel.

 

ADDITIONAL INFORMATION:. Furnish such additional information
and statements, lists of assets and liabilities, agings of receivables and payables, inventory schedules, budgets, forecasts, tax
returns, and other reports with respect to Borrower’s financial condition and business operations as Lender may request from
time to time.

 

TAXES, CHARGES AND LIENS. Borrower will not be required
to pay and discharge any such assessment, tax, charge, levy, lien or claim so long as (a) the legality of the same shall be
contested in good faith by appropriate proceedings, and (b) Borrower shall have established on its books adequate reserves
with respect to such contested assessment, tax, charge, levy, lien, or claim in accordance with generally accepted accounting practices.
Borrower, upon demand of Lender, will furnish to Lender evidence of payment of the assessments, taxes, charges, levies, liens and
claims and will authorize the appropriate governmental official to deliver to Lender at any time a written statement of any assessments,
taxes, charges, levies, liens and claims against Borrower’s properties, income, or profits.

 

SURVIVAL OF REPRESENTATION & WARRANTIES. Borrower
understands and agrees that Lender, without independent investigation, is relying upon the above representations and warranties
in extending Loan Advances to Borrower. Borrower further agrees that the foregoing representations and warranties shall be continuing
in nature and shall remain in full force and effect until such time as 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.

 

    	 

    	 

    

 

		BUSINESS LOAN AGREEMENT	
	Loan No: 155354101	(Continued)	 

 

ADDITIONAL DEFINITIONS.

 

Indebtedness. The word “Indebtedness” also
means Borrower may be obligated as a guarantor, surety, or otherwise; whether recovery upon such Indebtedness may be or hereafter
may become barred by any statute of limitations; and whether such Indebtedness may be or hereafter may become otherwise unenforceable.

 

Cash Flow. The words “Cash Flow” mean net
income after taxes, and exclusive of extraordinary gains and income, plus depreciation and amortization.

 

Debt. The word “DEBT” means all of Borrower’s
liabilities excluding Subordinated Debt.

 

Subordinated Debt. The words “Subordinated Debt”
mean indebtedness and liabilities of Borrower which have been subordinated by written agreement to indebtedness owed by Borrower
to Lender in form and substance acceptable to Lender.

 

Tangible Net Worth. The words “Tangible Net Worth”
mean Borrower’s total assets excluding all intangible assets (i.e., goodwill, trademarks, patents, copyrights, organizational
expenses, and similar intangible items, but including leasehold improvements) less total Debt.

 

Working Capital. The words “Working Capital”
mean Borrower’s current assets, excluding prepaid expenses, less Borrower’s current liabilities.

 

RIGHT TO AUDIT AND INSPECT. Without in any way limiting
Lender’s rights under any other provision of this Agreement, Lender shall be entitled to conduct annual audit(s) of Borrower’s
books and annual inspection(s) of the Inventory and Equipment and to check and test the same as to quality, quantity, value and
condition during the Borrower’s normal business hours. The costs and expenses incurred by Lender in connection with such
audits and inspections shall be charged to Borrower. Lender will invoice Borrower for such costs and expenses and Borrower shall
pay Lender the full amount of such costs and expenses within ten (10) days from the date of invoice.

 

PRIOR LOAN AGREEMENT. This Business Loan Agreement hereby
supersedes and replaces prior Business Loan Agreement dated April 1, 2006, along with all modification(s) and amendment(s)
thereto.

 

MAINTENANCE OF DEPOSITORY ACCOUNTS. Borrower shall maintain
it’s primary demand depository accounts with Lender.

 

LETTER OF CREDIT FACILITY. Subject to the terms of this
Agreement, Lender will issue standby letters of credit (each a “Letter of Credit”) on behalf of Borrower. At no time,
however, shall the total face amount of all Letters of Credit outstanding, less any partial draws paid under the Letters of Credit
exceed the sum of $1,000,000.00, with a maturity date of April 1, 2008. A three percent (3%) annual Letter of
Credit fee shall be accessed.

 

(1) Upon Lender’s request, Borrower promptly shall pay
to Lender issuance fees and such other fees, commissions, costs, and any out-of-pocket expenses charged or incurred by Lender with
respect to any Letter of Credit.

 

(2) The commitment by Lender to issue Letters of Credit shall,
unless earlier terminated in accordance with the terms of this Agreement, automatically terminate on the Expiration Date and no
Letter of Credit shall expire on a date which is more than zero (0) days after the Expiration Date.

 

(3) Each Letter of Credit shall be in form and substance satisfactory
to Lender and in favor of beneficiaries satisfactory to Lender, provided that Lender may refuse to issue a Letter of Credit due
to the nature of the transaction or its terms or in connection with any transaction where Lender, due to the beneficiary or the
nationality or residence of the beneficiary, would be prohibited by any applicable law, regulation, or order from issuing such
Letter of Credit. Under no circumstances, however will a Letter of Credit exceed zero (    ) days from the
issue date.

 

(4) Prior to the issuance of each Letter of Credit, and in all
events prior to any daily cutoff time Lender may have established for purposes thereof, Borrower shall deliver to Lender a duly
executed form of Lender’s standard form of application for issuance of letter of credit with proper insertions

 

(5) A minimum of ninety (90) days prior written cancellation
notice required.

 

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

 

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

 

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

 

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

 

Borrower Information. Borrower consents to the release
of information on or about Borrower by Lender in accordance with any court order, law or regulation and in response to credit inquiries
concerning Borrower.

 

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

 

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

 

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

 

Non-Liability of Lender. The relationship between Borrower
and Lender created by this Agreement is strictly a debtor and creditor relationship and not fiduciary in nature, nor is the relationship
to be construed as creating any partnership or joint venture between Lender and Borrower. Borrower is exercising Borrower’s
own judgement with respect to Borrower’s business. All information supplied to Lender is for Lender’s protection only
and no other party is entitled to rely on such information. There is no duty for Lender to review, inspect, supervise or inform
Borrower of any matter with respect to Borrower’s business. Lender and Borrower intend that Lender may reasonably rely on
all information supplied by Borrower to Lender, together with all representations and warranties given by Borrower to Lender, without
investigation or confirmation by Lender and that any investigation or failure to investigate will not diminish Lender’s right
to so rely.

 

Notice of Lender’s Breach. Borrower
must notify Lender in writing of any breach of this Agreement or the Related Documents by Lender and any other claim, cause of
action or offset against Lender within thirty (30) days after the occurrence of such breach or after the accrual of such
claim, cause of action or offset. Borrower waives any claim, cause of action or offset for which notice is not given in accordance
with this paragraph. Lender is entitled to rely on any failure to give such notice. 

 

    	 

    	 

    
 

		BUSINESS LOAN AGREEMENT	
	Loan No: 155354101	(Continued)	 

 

Indemnification of Lender. Borrower agrees to indemnify,
to defend and to save and hold Lender harmless from any and all claims, suits, obligations, damages, losses, costs and expenses
(including, without limitation, Lender’s attorneys’ fees), demands, liabilities, penalties, fines and forfeitures of
any nature whatsoever that may be asserted against or incurred by Lender, its officers, directors, employees, and agents arising
out of, relating to, or in any manner occasioned by this Agreement and the exercise of the rights and remedies granted Lender under
this, as well as by: (1) the ownership, use, operation, construction, renovation, demolition, preservation, management, repair,
condition, or maintenance of any part of the Collateral; (2) the exercise of any of Borrower’s rights collaterally assigned
and pledged to Lender hereunder; (3) any failure of Borrower to perform any of its obligations hereunder, and/or (4) any
failure of Borrower to comply with the environmental and ERISA obligations, representations and warranties set forth herein. The
foregoing indemnity provisions shall survive the cancellation of this Agreement as to all matters arising or accruing prior to
such cancellation and the foregoing indemnity shall survive in the event that Lender elects to exercise any of the remedies as
provided under this Agreement following default hereunder. Borrower’s indemnity obligations under this section shall not
in any way be affected by the presence or absence of covering insurance, or by the amount of such insurance or by the failure or
refusal of any insurance carrier to perform any obligation on its part under any insurance policy or policies affecting the Collateral
and/or Borrower’s business activities. Should any claim, action or proceeding be made or brought against Lender by reason
of any event as to which Borrower’s indemnification obligations apply, then, upon Lender’s demand, Borrower, at its
sole cost and expense, shall defend such claim, action or proceeding in Borrower’s name, if necessary, by the attorneys for
Borrower’s insurance carrier (if such claim, action or proceeding is covered by insurance), or otherwise by such attorneys
as Lender shall approve. Lender may also engage its own attorneys at its reasonable discretion to defend Borrower and to assist
in its defense and Borrower agrees to pay the fees and disbursements of such attorneys.

 

Counterparts. This Agreement may be executed in multiple
counterparts, each of which, when so executed, shall be deemed an original, but all such counterparts, taken together, shall constitute
one and the same Agreement.

 

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 to 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.

 

Sole Discretion of Lender. Whenever Lender’s consent
or approval is required under this Agreement, the decision as to whether or not to consent or approve shall be to the sole and
exclusive discretion of Lender and Lender’s decision shall be final and conclusive.

 

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 extending Loan Advances, 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 extension of Loan Advances and delivery to Lender of the Related Documents, shall be continuing
to nature, shall be deemed made and redated by Borrower at the time each Loan Advance is made, and shall remain in full force and
effect until such time as Borrower’s Indebtedness shall be paid in full, or until this Agreement shall be terminated in the
manner provided above, whichever is the last to occur.

 

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

 

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

 

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

 

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

 

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

 

Borrower. The word “Borrower” means BISCO
INDUSTRIES, INC. and includes all co-signers and co-makers signing the Note and all their successors and assigns.

 

Cash & Equivalent. The words “Cash &
Equivalent” mean all of Borrower’s cash, marketable securities, and other near-cash items, excluding sinking funds.

 

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

 

Environmental Laws. The words “Environmental Laws”
mean any and all state, federal and local statutes, regulations and ordinances relating to the protection of human health or the
environment, including without limitation the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as
amended, 42 U.S.C. Section 9601, et seq. (“CERCLA”), the Superfund Amendments and Reauthorization Act of 1986,
Pub. L. No. 99-499 (“SARA”), the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq.,
the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., Chapters 6.5 through 7.7 of Division 20 of the
California Health and Safety Code, Section 25100, et seq., or other applicable state or federal laws, rules, or regulations
adopted pursuant thereto.

 

ERISA. The word “ERISA” means the Employee
Retirement Income Security Act of 1974, as amended from time to time, and including all regulations and published interpretations
of the act.

 

Event of Default. The words “Event of Default”
mean individually, collectively, and interchangeably 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.

 

    	 

    	 

    
 

		BUSINESS LOAN AGREEMENT	
	Loan No: 155354101	(Continued)	 

 

Guarantor. The word “Guarantor” means any
guarantor, surety, or accommodation party of any or all of the Loan, and, in each case, Borrower’s successors, assigns, heirs,
personal representatives, executors and administrators of any guarantor, surety, or accommodation party.

 

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 COMMUNITY
BANK, its successors and assigns.

 

Loan. The word “Loan” means any and all loans
and financial accommodations from Lender to Borrower whether now or hereafter existing, and however evidenced, including without
limitation those loans and financial accommodations described herein or described on any exhibit or schedule attached to this Agreement
from time to time, and further including any and all subsequent amendments, additions, substitutions, renewals and refinancings
of any of Borrower’s Loans.

 

Note. The word “Note” means the promissory
note dated November 15, 2000, in the original amount of $8,000,000.00 from BISCO INDUSTRIES, INC. to Lender, together with
all renewals of, extensions of, modifications of, refinancings of, consolidations of, and substitutions for the promissory note
or agreement.

 

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, individually, collectively, and interchangeably, 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.

 

Trade Receivables. The words “Trade Receivables”
mean all of Borrower’s accounts from trade, net of allowance for doubtful accounts.

 

BORROWER ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS
BUSINESS LOAN AGREEMENT AND BORROWER AGREES TO ITS TERMS. THIS BUSINESS LOAN AGREEMENT IS DATED JUNE 1, 2007.

 

	BORROWER:
	 
	BISCO INDUSTRIES, INC.
	 	 
	By:	/s/ Glen F. Ceiley 	 
	 	GLEN F. CEILEY, Chairman and CEO of BISCO

INDUSTRIES, INC.
	 
	LENDER:
	 
	COMMUNITY BANK
	 	 
	By:	/s/ 	 
	 	Authorized Signer

 

	 
	LASER PRO Lending, Ver. 5.60.00.005 Copr. Harland Financial Solutions, Inc. 1997, 2012. All Rights Reserved. - CA G:\CF150\CFI\LPL\D20C.FC TR-6558 PR-38

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