Document:

EXIT
FINANCING

    TERM
SHEET

    FOR

    

    OTTER
TAIL AG ENTERPRISES, LLC,

    AS DEBTOR
IN POSSESSION

    IN
BANKRUPTCY CASE NO. 09-61250

    UNITED
STATES BANKRUPTCY COURT, DISTRICT OF MINNESOTA

    

    AGSTAR
FINANCIAL SERVICES, PCA, (“AgStar”) as the administrative
agent for the banks to be determined (the “Banks”) hereby provides OTTER
TAIL AG ENTERPRISES, LLC, a Minnesota limited liability company (the “Debtor”), with the following
proposal for the exit financing pursuant to the terms of a plan of
reorganization which is acceptable to AgStar and the Banks.  THIS
PROPOSAL IS NOT A COMMITMENT TO LEND, but does evidence our sincere interest in
providing the financing required by the Debtor upon its emergence from the
pending Chapter 11 case.

    

    Reference
is made herein to the following AgStar Prepetition Loan Agreements
(collectively, the “AgStar
Prepetition Loan Agreements”):

    

    
      	  	
              a. 

            	
              Master
      Loan Agreement dated March 28,
2007;

            

    

    

    
      	
               
      

            	
              b.

            	
              First
      Supplement to the Master Loan Agreement dated as of March 28,
      2007;

            

    

    

    
      	
               
      

            	
              c.

            	
              Amended
      and Restated Master Loan Agreement dated as of June 23,
    2008;

            

    

    

    
      	
               
      

            	
              d.

            	
              Amended
      and Restated Second Supplement to the Master Loan Agreement dated as of
      June 23, 2008; and

            

    

    

    
      	
               
      

            	
              e.

            	
              Second
      Amended and Restated Third Supplement to the Master Loan Agreement (the
      “Prepetition
      RLOC”) dated as of June 23,
2008.

            

    

    

    Unless
otherwise expressly defined herein, capitalized terms used herein shall have the
same meaning ascribed to them in the AgStar Prepetition Loan
Agreements.  Terms and conditions of the exit financing proposal are
as follows:

    

    
      	
              Debtor:

            	
              Otter
      Tail Ag Enterprises, LLC, a Minnesota limited liability company, as Debtor
      in Possession in its Chapter 11 case in the United States Bankruptcy
      Court, District of Minnesota (the “Debtor’s Chapter 11
      Case”).

               

            
	
              Lender:

            	
              AgStar
      Financial Services, PCA, as administrative agent for the
      Banks.

               

            
	
              Credit
      Facilities:

            	
              A
      term loan, representing the unpaid balance of the existing term note in
      addition to the unpaid balance of the term revolving note, not to exceed
      the original combined amount of $35,000,000.00 (the “Term
    Loan”).

            
	 
      	 
      
	 
      	
              A
      364-day revolving credit facility in an amount not to exceed the lesser of
      (a) 75% of Eligible Accounts and Eligible Inventory or
      (b)  $4,000,000.00 (the “Revolving
      Loan”).

            

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    
      	 
      	
              The
      Term Loan and the Revolving Loan are hereinafter referred to as the “Loans.”

            
	 
      	 
      
	
              Closing
      Date:

            	
              A
      date not later than 10 Business Days following the entry of a confirmation
      order (the “Confirmation
      Order”) confirming the Debtor’s plan of reorganization (the “Plan”).

               

            
	
              Purposes:

            	
              The
      Loans contemplated by this term sheet may be used by the Debtor for (a)
      working capital purposes, (b) payment of professional and United States
      Trustee fees as set forth in the Plan; (c) payment of any amounts
      necessary to obtain the release of subordinate liens and security
      interests in any of the Collateral in an amount acceptable to AgStar in
      its sole discretion; and (d) such other purposes as may be acceptable to
      AgStar in its sole discretion.

               

            
	
              Maturity
      Dates:

            	
              The
      Term Loan will mature on June 1, 2013.

               

              The
      Revolving Loan will mature 364 days following the effective date of the
      Plan.

               

            
	
              Interest:

            	
              The
      outstanding principal amount of the Term Loan shall bear interest at a
      fixed rate equal to 6.5% per annum through May 31, 2013, provided,
      however, that such rate will be adjusted to reflect any changes in the
      three-year U.S. Treasury bond rate of interest between the date of this
      term sheet and the effective date of the Plan.

               

              Accrued
      interest on the Term Loan will be paid in arrears monthly on the first day
      of the first three (3) calendar months following the effective date of the
      Plan.

               

              The
      outstanding principal amount of the Revolving Loan shall bear interest at
      a fixed rate equal to 6.5% per annum through May 31,
      2013,  provided, however, that such rate will be adjusted to
      reflect any changes in the three-year U.S. Treasury bond rate of interest
      between the date of this term sheet and the effective date of the
      Plan.

               

              Accrued
      interest on the Revolving Loan will be paid in arrears monthly on the
      first day of each calendar month beginning with the first calendar month
      following the effective date of the Plan.

               

              The
      default rate of interest will be 2.00% higher than the rate otherwise
      payable.

               

            
	
              Amortization:

            	
              The
      Term Loan will be payable in (i) a special principal payment of $3,150,000
      on the first day of the first calendar month following the effective date
      of the Plan and (ii) the balance of the Term Loan in equal monthly
      installments of principal and interest sufficient to fully amortize the
      Term Loan over 10 years from the effective date of the Plan, beginning
      with the first day of the fourth calendar month following the effective
      date of the Plan.

            

    

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    

    
      	 
      	
              The
      Revolving Loan will be payable in full on its applicable maturity
      date.

            
	 
      	 
      
	
              Security:

            	
              The
      Term Loan and the Revolving Loan will be secured by a first priority
      perfected security interest in all of the real and personal property of
      the Debtor, whether now owned or hereafter acquired (the “Collateral”), subject
      only to such other liens and encumbrances as may be acceptable to
      AgStar.

               

            
	
              Accrued
      Default Interest:

            	
              All
      default interest provided by the AgStar Prepetition Loan Agreements will
      be deferred until June 1, 2013.  Provided the Debtor does not
      default in the performance of its obligations under the Loan Documents,
      the Loan Documents will provide that such default interest will be waived
      by AgStar on June 1, 2013.

               

            
	
              Plan
      of Reorganization:

            	
              The
      Debtor shall file the Plan, which must be acceptable to AgStar and MMCDC
      New Markets Tax Fund (“NMF” and collectively
      with AgStar, the “Prepetition Lenders”),
      on or before February 28, 2010 (the “Plan
Date”).

               

              At
      a minimum, the Plan shall not be deemed acceptable to the Prepetition
      Lenders unless:

               

              ·      The
      Plan provides for and treats the Prepetition Lenders as  fully
      secured creditors;

               

              ·      The
      Plan provides for the financing set forth in this Term Sheet;

               

              ·      The
      Confirmation Order and the Plan provide that the assets of Debtor will be
      free from any and all subordinate mortgages, liens, and encumbrances,
      including any lessor’s interests, except as may be accepted by the
      Prepetition Lenders.

               

            
	
              Conditions
      Precedent To Closing:

            	
              Entry
      of the Confirmation Order confirming the Plan which is satisfactory to
      AgStar on or before May 1, 2010;

               

            
	 
      	
              Execution
      and delivery of an amended and restated Credit Agreement together with
      such other notes, mortgages, security agreements, control agreements,
      documents, and agreements as may be required by AgStar satisfactory to
      AgStar and the Banks (collectively the “Loan Documents”) which
      Loan Documents will contain representations; warranties; affirmative,
      negative and financial covenants (including, but not limited to,
      limitations on acquisitions, additional debt, bonuses, distributions,
      change in control, change in senior management, capital expenditures,
      disposition of assets and other covenants deemed appropriate by AgStar and
      the Banks); events of default; and remedies acceptable to AgStar and the
      Banks;

               

            
	 
      	
              AgStar’s
      receipt of subscription letters, acceptable to AgStar (collectively, the
      “Subscription
      Letters”), (a) in an amount not less than $6,000,000.00 on or
      before January 15, 2010; and (b) in an aggregate amount not less than
      $12,000,000.00 on or before the Plan
Date

            

    

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

    
      	 
      	
              Confirmation
      of equity contributions pursuant to the Subscription Letters to the
      reorganized Debtor of at least $12,000,000;

               

            
	 
      	
              Payment
      to AgStar of an amount sufficient to reduce the outstanding principal
      balance of the Prepetition RLOC to an amount not greater than
      $4,000,000;

               

            
	 
      	
              Delivery
      of a risk management plan reasonably acceptable to AgStar including a
      designated risk management officer;

               

            
	 
      	
              Compliance
      with all conditions precedent required by NMF including payment of all
      interest and default charges due;

               

            
	 
      	
              If
      not expressly provided in the Confirmation Order, execution of an
      agreement with U.S. Bank, as Indenture Trustee (the “Trustee”), and Otter
      Tail County (the “County”) regarding the
      resolution of the outstanding bond debt and the release of all liens,
      security interests or lessor interests in any of the assets of the Debtor;
      and

               

            
	 
      	
              Compliance
      with all conditions precedent set forth in the Loan
Documents.

               

            
	
              Sale
      of Ethanol Facility:

            	
              If
      no Plan acceptable to the Prepetition Lenders is filed by the Plan Date,
      the Debtor shall file, within ten (10) Business Days thereafter, a motion
      to sell the Debtor’s assets, including the ethanol production facility,
      free and clear of interests, liens, encumbrances and claims pursuant to
      Bankruptcy Code § 363(b) and (f).  Such motion must be
      accompanied by sales procedures acceptable to AgStar, including that any
      such sale shall close not later than May 1, 2010.

               

              Within
      ten (10) Business Days of filing such motion, the Debtor shall engage a
      financial advisor (the “Financial Advisor”)
      reasonably acceptable to the Prepetition Lenders to manage the sale of the
      ethanol facility.

               

            
	
              Expenses:

            	
              The
      Debtor shall reimburse AgStar for all reasonable costs and expenses,
      including legal fees, consultant fees, appraisal fees, financial advisor
      fees, and other similar fees, costs and expenses in connection with the
      negotiation, documentation, execution, syndication and delivery of the
      Loans and the Debtor’s Chapter 11 Case.  AgStar shall be
      authorized to advance from the Loans an amount equal to such costs and
      expenses.

            

    

    

    The
above term sheet is subject to the consent and approval of the
Banks.

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    

    If not
acted on, these terms will expire on January 15, 2010, at 5:00 p.m.
(CST).  Please return a signed copy of this letter to evidence your
acceptance of the terms and conditions contained in this Term
Sheet.

    

    
      
        
          
            	
                    Sincerely,

                  
	 
      
	
                    AGSTAR
      FINANCIAL SERVICES, PCA,

                  
	 
      
	
                    /s/ Ron
Monson

                  

          

        

      

    

    
      
        	
                By: 

              	
                Ron Monson

              
	
                Its:

              	
                VP

              

      

    

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    SIGNATURE
PAGE TO

    EXIT
FINANCING

    TERM
SHEET

    FOR

    

    OTTER
TAIL AG ENTERPRISES, LLC,

    AS DEBTOR
IN POSSESSION

    IN
BANKRUPTCY CASE NO. 09-61250

    UNITED
STATES BANKRUPTCY COURT, DISTRICT OF MINNESOTA

    

    This Term
Sheet is accepted this 15th
day

    of
January 2010 by:

    

    DEBTOR:

    

    OTTER
TAIL AG ENTERPRISES, LLC

    a
Minnesota limited liability company

    

    
      
        	
                By
      

              	
                /s/ Anthony J Hicks

              
	
                 Name:
      Anthony J Hicks

              
	
                 Title:
      Chief Executive Officer

              

      

    

    
      
         

      

      
        6Unassociated Document

    
       

      
        	FORUM FINANCIAL SERVICES,
      INC.      	
                Agreement No.
      8174

              
	 	 

      

    

    MASTER
LEASE AGREEMENT

     

    This
MASTER LEASE AGREEMENT dated as of January 22, 2010 by and between FORUM
FINANCIAL SERVICES, INC., a Texas corporation, having its principal place of
business at 275 West Campbell Road, Suite 320, Richardson, Texas 75080
("Lessor"), and BIOANALYTICAL SYSTEMS, INC., an Indiana corporation, having its
principal place of business at Purdue Research Park, 2701 Kent Avenue, West
Lafayette, Indiana 47906 ("Lessee").

    

    1.
EQUIPMENT LEASED.

     

    Subject
to the terms and conditions hereinafter set forth in this Master Lease
Agreement, Lessor hereby rents, demises and lets to Lessee, and Lessee shall
hire from Lessor, the units of tangible personal property (hereinafter
collectively referred to as "Equipment" and individually as a "Unit" or "Item")
listed on each Equipment Schedule executed, from time to time, pursuant to this
Master Lease Agreement. Each Equipment Schedule (hereinafter being referred to
as "Lease") shall incorporate therein all of the terms and conditions of this
Master Lease Agreement and shall contain such additional terms and conditions as
Lessor and Lessee shall agree upon.

    

    2.
TERM.

    

    The lease
term for each Item shall commence on the first to occur of (i) the date on which
the Item is installed and is approved for coverage under a prime shift
maintenance contract by the manufacturer thereof, or (ii) seven days from the
date the Item is delivered if a delay of installation and approval is caused by
Lessee (hereinafter referred to as the "Commencement Date"). If the Item is
specified as "new" in such Lease, the date of installation of such Item shall
constitute the Commencement Date. The lease term shall continue for the number
of full months set forth in such Lease (hereinafter referred to as the "Initial
Term"), commencing on the first day of the month following the latest
Commencement Date for any Item (hereinafter referred to as the "Initial Term
Commencement Date"). Lessee shall execute and deliver to Lessor the Acceptance
Certificate for the Equipment confirming such Commencement Date on such
date.

    

    3.
RENTALS.

    

    The
monthly rent payable by Lessee for each Item on any Lease (hereinafter referred
to as "Monthly Rent") shall be set forth in such Lease. Lessee shall pay to
Lessor, as rental for the Equipment, the sum of (i) Monthly Rent per month,
payable in advance on the Initial Term Commencement Date and on the first day of
each month thereafter during the Initial Term of the Lease, and (ii) an amount
equal to one-thirtieth of the Monthly Rent for each Item for each day which has
elapsed from and including the Commencement Date of such Item to the initial
Term Commencement Date, which amount shall be paid on the Commencement Date and
monthly thereafter. If any portion of Lessee's monthly rent continues unpaid for
five (5) days or more following the due date, including Sundays and holidays,
Lessee will pay an administrative late charge of five (5) cents for each one
dollar ($1.00) of the scheduled monthly rent payment. In addition to the
administrative late charge, any
payments (of rent or otherwise) which are not paid within five (5) days
of their due date shall be payable on demand and shall bear interest on such
amount at the lesser of 1.5% per month or the maximum allowable rate of interest
permitted by law. All Rent and other sums due hereunder shall be paid at the
address of Lessor set forth above or at such other place as Lessor shall
designate in writing, or, if to an assignee of Lessor, at such place as such
assignee shall designate in writing.

    

    4. NET
LEASE.

    

    Lessor
and Lessee acknowledge and agree that each Lease constitutes a net lease, and
that Lessee's obligation to pay all Monthly Rent and any and all sums payable by
Lessee under any Lease, shall be absolute and unconditional. Lessee's
obligations shall not be subject to any abatement, reduction, setoff, defense,
counterclaim, interruption, deferment or recoupment for any reason whatsoever,
and that such payments shall be and continue to be payable in all events. This
Lease shall not terminate, nor shall the respective obligations of Lessor or
Lessee be affected, by reason of any defect in the condition, operation, fitness
for use, damage or destruction of or to the Equipment or any Unit thereof, or
any interruption or cessation in use or possession for any reason whatsoever.
This Lease shall be binding upon the Lessee, its successors and assigns and
shall inure to the benefit of Lessor and its successors and assigns, and all
references to Lessor shall include such successors and assigns.

    

    5.
TAXES.

    

    During
the term of this Lease, Lessee shall promptly pay when due or reimburse and
indemnify and hold Lessor harmless from and against all Taxes, as hereinafter
defined. The term "Taxes" as used herein shall mean all taxes, fees or other
charges of any nature whatsoever (together with any related interest or
penalties not arising from the negligence on the part of Lessor) now or
hereafter imposed or assessed during the term of each Lease against Lessor,
Lessee or the Equipment by any Federal, state, county, or local governmental
authority upon or with respect to the Equipment or upon the ordering, purchase,
sale, ownership, delivery, leasing, possession, use, operation, return or other
disposition thereof or upon the rents, receipts or earnings arising therefrom or
upon or with respect to any Lease (excepting only Federal, state and local taxes
based on or measured by the net income of Lessor). Notwithstanding the
foregoing, unless otherwise specified in the Lease, Lessee shall be responsible
for the filing and paying of all personal property taxes with respect to the
Equipment.

    

    6.
WARRANTIES.

     

    
      (a)
LESSEE ACKNOWLEDGES THAT LESSOR HAS MADE NO REPRESENTATION OR WARRANTIES OF ANY
KIND, EXPRESSED OR IMPLIED, AS TO ANY MATTER WHATSOEVER, INCLUDING, WITHOUT
LIMITATION, THE DESIGN, PERFORMANCE, OR CONDITION OF THE EQUIPMENT, ITS
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. LESSOR SHALL HAVE NO
LIABILITY TO LESSEE FOR ANY CLAIM, LOSS OR DAMAGE CAUSED BY OR ARISING IN ANY
WAY IN CONNECTION WITH THE EQUIPMENT. NOR SHALL THERE BE ANY ABATEMENT OF
RENTAL, FOR ANY REASON INCLUDING CLAIMS ARISING OUT OF OR IN CONNECTION WITH ANY
DEFICIENCY OR DEFECT IN THE EQUIPMENT, THE USE OR PERFORMANCE OF THE EQUIPMENT,
OR ANY LOSS OF BUSINESS OR OTHER CONSEQUENTIAL LOSS OR DAMAGE WHETHER OR NOT
RESULTING FROM ANY OF THE FOREGOING.

       

      (b) Lessor hereby appoints Lesseee as Lessor's agent to assert,
during the term of the applicable Lease, any and all manufacturer's warranties,
with respect to the Equipment to the extent assignable by Lessor; provided,
however, that Lessee shall indemnify and hold Lessor or its assignee harmless
from and against any and all claims, costs, expenses, damages, losses and
liabilities incurred or suffered by Lessor as a result of or incident to any
action by Lessee in connection therewith.

       

      Lessee's Initials: MRC

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    7.
TITLE AND
ASSIGNMENT.

     

    
      (a)
Nothing contained in any Lease shall give or convey to Lessee any right, title
or interest in or to the Equipment except as a Lessee as set forth therein and
Lessee represents and agrees that Lessee shall hold the Equipment subject and
subordinate to the rights of the
owner, Lessor, any Assignee and any Secured Party and Lessee shall
execute and immediately deliver such documentation, including Uniform Commercial
Code financing statements, as are requested by Lessor for such purpose. Lessee
shall, at its expense, protect and defend Lessor's title as well as the interest
of any Assignee and any Secured Party against all persons claiming against or
through Lessee and shall at all times keep the Equipment free and clear from any
legal process, liens or encumbrances whatsoever (except any placed thereon by
Lessor) and shall give Lessor immediate written notice thereof and shall
indemnify and hold Lessor, any Assignee and any Secured Party harmless from and
against any loss caused thereby.

    

     

    
      (b) If
provided by Lessor, Lessee shall affix and maintain tags, decals or plates to
the Equipment indicating ownership and title to the Equipment in Lessor (or any
Assignee) and Lessee shall not permit the removal or concealment of such tags.
Lessee shall keep the Equipment free from any marking or labeling which might be
interpreted as a claim of ownership thereof by Lessee or any party other than
Lessor or any Assignee. Upon the request of Lessor, Lessee shall at reasonable
times during business hours make the Equipment available to Lessor for
inspection at the place where it is normally located and shall make Lessee's log
and maintenance records pertaining to the Equipment available to Lessor for
inspection.

    

    

    (c) Upon
at least sixty (60) days prior written notice to Lessor, Lessee may assign or
sublease the Equipment to any party, or relocate the equipment to any location,
within any state of the continental United States which shall have in effect the
Uniform Commercial Code provided (i) that all costs of any nature whatsoever
resulting from any relocation, assignment or sublease shall be promptly paid by
Lessee
upon presentation to Lessee of evidence supporting such cost, and
(ii) any assignment or sublease shall be made expressly subject and subordinate
to the terms of this Lease and Lessee shall assign its rights under said
assignment or sublease to Lessor, any Assignee and any Secured Party as
additional collateral and security for Lessee's obligations hereunder. No
permitted relocation, assignment or sublease shall relieve Lessee of any of its
obligations hereunder. Lessee hereby grants to Lessor the right and opportunity
to submit or match the last proposal for the sublease or assignment of the
Equipment, and to submit a proposal for the financing of any replacement
Equipment.

    

    (d)
Lessor may assign to a successor lessor, lender or purchaser, and Lessee hereby
consents to the assignment of, all or any part of the Lessor's right, title and
interest in and to the Lease and the Equipment. Lessee acknowledges and
understands that the terms and conditions of each Lease have been fixed by
Lessor in anticipation of its ability to sell and assign its interest or grant a
security interest under each Lease and the Equipment listed therein in whole or
in part to a security assignee (the "Secured Party") for the purpose of securing
a loan to the Lessor. The Lessor may also sell and assign its rights as owner
and lessor of the Equipment under any Lease to an assignee (the "Assignee")
which may be represented by a bank or trust company acting as a trustee for the
Assignee. After such assignments the term Lessor shall mean, as the case may be,
such Assignee and any Secured Party. Notwithstanding the foregoing, any
assignment by Lessor shall not relieve Lessor of its obligations to Lessee
hereunder. Lessee, upon receipt of notice of any such assignment or assignments
and instructions from Lessor, shall:

     

    
      (i) pay
and perform its obligations hereunder to such Assignee and any Secured Party and
acknowledge that the Assignee and any Secured Party shall have and be entitled
to exercise any and all discretion, rights and powers of hereunder or under any
Lease, provided, however that such Assignee or Secured Party shall take no
action to interfere with Lessee's quiet enjoyment and use of the Equipment in
accordance with the terms of the Lease hereof so long as Lessee is not in
default of any of the provisions hereof and such Assignee or Secured Party
continues to receive all amounts of Monthly Rent payable under such
Lease;

    

     

    (ii) not
permit the Lease to be amended, modified or terminated without the prior written
consent for such from Assignee and any Secured Party; 

     

    (iii) not
look to Assignee or any Secured party to perform any of Lessor's obligations
hereunder;

    

    (iv) not
assign the Lease or any of its rights hereunder without the prior written
consent of Assignee, and

    

    (v) send
to Assignee and any Secured Party as well as Lessor copies of any notices which
are required hereunder to be sent to Lessor. 

     

    8.
DELIVERY, USE, AND RETURN OF EQUIPMENT.

    

    
      (a) Upon
delivery of the Equipment to Lessee, Lessee shall pay and hereby assumes all
transportation, installation, rigging, and in-transit insurance charges with
respect to the Equipment. In the case of a sale and leaseback transaction,
Lessee shall, upon the request of Lessor, certify the date the Equipment was
first put into use.

    

     

    (b)
Lessee shall, at all times during the term of the Lease, be entitled to
unlimited use of the Equipment. Lessee will comply with all laws, regulations,
and ordinances, and all applicable requirements of the manufacturer of the
Equipment which apply to the physical possession, use, operation, condition, and
maintenance of the Equipment.

     

    (c)
Lessee may, upon receipt of prior written consent of Lessor, at its own expense,
make alterations in or add attachments to the Equipment (the "Upgrade"),
provided such Upgrade does not interfere with the normal operation or
maintenance of the Equipment or with Lessee's ability to obtain and maintain the
maintenance contract required by Section 9. hereof. During the term of the Lease
and provided Lessee is not in default, all Upgrades shall be the property of
Lessee, and no liens, encumbrances or interest may be granted by Lessee in such
Upgrades which impair Lessor's rights, title and interest in the Equipment. At
the request of Lessor, Lessee shall (and, absent such request, Lessee may), upon
expiration or termination of the Lease covering such Equipment, remove any such
Upgrade and restore the Equipment to its original condition (ordinary wear and
tear excepted), all at Lessee's expense, prior to returning the Equipment to
Lessor.

     

    (d) Upon
the termination (by expiration or otherwise) of each Lease. Lessee shall,
pursuant to Lessor's instructions and at Lessee's full expense, de-install, pack
and return the Equipment to Lessor in the same operating order, repair,
condition and appearance as when received, reasonable wear and tear excepted.
Lessee shall return the Equipment to Lessor at its address set forth herein or
at such other address within the continental United States as directed by
Lessor. Until the return of the Equipment to Lessor, Lessee shall be obligated
to pay the Monthly Rental and all other sums due hereunder.

    

    9.
MAINTENANCE AND REPAIR.

    

    During
the term of each Lease, Lessee shall, at its sole expense, maintain the
Equipment in good operating order, repair, condition and appearance and make all
necessary repairs to protect the Equipment from deterioration, other than normal
wear and tear. Lessee shall not use or permit the Equipment to be used for any
purpose for which, in the opinion of the manufacturer, the Equipment is not
designed or intended. Lessee shall, during the term of each Lease, at its sole
expense, maintain in full force and effect a contact with the manufacturer or
such other party as shall be acceptable to Lessor, covering at least prime shift
maintenance of the Equipment. Lessee shall furnish Lessor, upon request, with a
copy of such maintenance contract (or warranty) or supplements thereto. If
Lessee has the Equipment maintained by a party other than the manufacturer,
Lessee hereby assumes and agrees to pay any costs necessary to have the
manufacturer re-certify the Equipment at the scheduled termination of the lease
term, which lease term shall continue upon the same terms and conditions until
such re-certification has been obtained.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
    

    10.
REPRESENTATIONS AND WARRANTIES OF LESSEE.

     

    (a)
Lessee hereby represents, warrants and covenants that, with respect to the
Master Lease Agreement and each Lease executed hereunder, (i) the execution,
delivery and performance thereof by the Lessee have
been duly authorized by all necessary corporate action, (ii) the Lease
will be in full force and effect and constitute a valid obligation binding upon
and enforceable against Lessee in accordance with its terms, (iii) the Equipment
covered by the lease is accurately described in the Lease and all documents
relating thereto, (iv) the Equipment is personal property and when subject to
use by the Lessee will not be or become fixtures under applicable law, and (v)
any and all financial statements and other information with respect to Lessee
supplied to Lessor at the time of execution of the Lease any amendments hereto,
are true and complete.

     

    (b) Prior
to and during the term of the Lease. Lessee will furnish Lessor, when
reasonably available, with Lessee's audited financial statements. If Lessee is a
subsidiary of another company, Lessee shall supply such parent's financials and
guarentees as are acceptance to Lessor. 

     

    (c)
Lessee, upon execution of this Master Lease Agreement and thereafter upon
execution of each lease, shall provide Lessor with (i) an incumbency
certificate certifying that the person signing the Lease holds the office
he purports to hold and has authority to sign on behalf of Lessee; (iii) an
opinion of Lessee's counsel with respect to the representations in Section 10(a)
above; (iii) a certificate of the secretary or assistant secretary of Lessee
referring to the resolutions (specific or general) authorizing the transactions
contemplated herein; (iv) an agreement with Lessor's assignee with regard to any
assignment as referred to in Section 7(d); (v) the purchase documents if Lessee
has sold or assigned its interest in the Equipment to Lessor; (vi) an insurance
certificate pursuant to Section 13 hereof; and (vii) all other documents as
Lessor may reasonably request. If Lessee shall fail to timely and properly
deliver any of the aforesaid documents when due shall cause Lessor, at Lessor's
option and notwithstanding anything
to the contrary contained in Section 2 hereof, to postpone the
commencement of the Initial Term, to increase the Monthly Rental to recover
costs incurred by Lessor consequent to the delay, or to terminate the Lease as
provided in Section 15.

     

    11.
QUIET ENJOYMENT.

    Lessor
covenants that so long as Lessee is not in default, and keeps and performs each
and every covenant, condition and agreement hereunder, Lessee will quietly
possess the Equipment subject to and in accordance with the provisions of the
Lease.

    

    12. INDEMNITY.

    

    Lessee
hereby agrees to assume liability for, and does hereby agree to indemnify,
protect and hold Lessor, any Assignee and any Secured Party harmless from and
against any and all liabilities, obligations, losses, damages, penalties,
claims, actions, suits, costs, or expenses (including legal fees
and expenses), arising out of the manufacturer, purchase, ownership,
selection, possession, leasing, operation, control, use, maintenance, delivery,
return or other disposition of any Unit. Notwithstanding the foregoing, Lessee
shall not be responsible under the terms of this Section 12 to a party
indemnified hereunder for any claims, costs, expenses, damages and liabilities
caused by the gross negligence or wilful misconduct of such indemnified party.
At the request of Lessor, Lessee shall undertake to defend at Lessee's expense,
Lessor, any Assignee and any Secured Party, in any claim, action or suit covered
by this Section 12.

    

    13.
RISK OF LOSS, INSURANCE.

    

    (a)
Lessee hereby assumes and shall bear the entire risk of loss and damage, of the
Equipment from any and every cause whatsoever as of the date the Equipment is
delivered to Lessee and throughout the Initial Term and any extension thereof.
No loss or damage to the Equipment or any part thereof shall impair any
obligation of Lessee under this Lease, which shall continue in full force and
effect.

     

    
      (b)
During the term of the Lease, Lessee, at its own expense, shall insure the
Equipment against all risks and in such amounts as Lessor shall reasonably
require (but not less than the Casualty Value of the Equipment) with carriers
acceptable to Lessor. Such insurance shall also provide for loss payable
endorsement to Lessor, any Assignee, and any Secured Party. Lessee shall also
maintain comprehensive public liability insurance satisfactory to Lessor. All
such insurance shall name Lessor, or Assignee, or any Secured party, and the
policies shall provide that they may not be terminated or modified without at
least 30 days' prior written notice to Lessor, or Assignee, or any Secured
Party.

    

    

    (c) In
the event of loss or damage of any Unit, Lessee shall use all reasonable efforts
to place the Unit in good repair, condition and working order to the
satisfaction of Lessor within 60 days of such loss or damage, unless the
manufacturer determines that such Unit has been irreparably damaged, in which
case Lessee shall, within 10 days of the manufacturer's determination of
irreparable loss, make its election to either pay Lessor the Casualty Value
(as
set forth
in Annex A to the Lease) for the irreparably damaged Unit or replace the
irreparably damaged unit, all as provided hereinafter.

     

    
      (d) In
the event that Lessee elects to pay Lessor the Casualty Value for the
irreparably damaged Unit, Lessee shall pay
such amount to Lessor on the first day of the month following the
election by Lessee as provided in (c) above and pay all Monthly Rent for the
Equipment up to the date that the Casualty Value is paid to Lessor. If not all
the Equipment is irreparably damaged, the
Equipment Value (as identified in the Lease) of the irreparably damaged
Unit shall be multiplied by the applicable percentage set forth in Annex A to
compute the Casualty Value therefor, and the Monthly Rental for the undamaged
Equipment remaining due shall be that amount resulting from multiplying the
original Monthly Rental by the ratio of the original Equipment Value of the
undamaged Equipment divided by the Equipment Value for all the Equipment prior
to the damage.

    

    

    (e)
Should Lessee elect to replace the irreparably damaged Unit, Lessee shall
continue all payments under the lease without interruption as if no such damage,
loss or destruction had occurred, and shall replace such irreparably damaged
Unit within 30 days following the date the manufacturer determines the Unit is
irreparable, paying all such costs associated therewith, and so that Lessor has
good and valid title thereto. The "Replacement Equipment" shall have a fair
market value at the time of replacement equal to then fair market value of the
Unit thereof for which replacement is made, and anticipated to have a fair
market value which the Unit thereof for which replacement is made would have had
at the end of the Initial Term, and be the same type and of at least equal
capacity to the Unit for which the replacement is being made. Upon delivery,
such Replacement Equipment shall become subject to all the terms and conditions
of the Lease.

     

    14.
DEFAULT, REMEDIES.

    

    (a) The
occurrence of any one or more of the following events (herein called "Events of
Default") shall constitute a default under a Lease.

    

    
       
(i) Lessee
fails to pay any installment of Monthly Rent or other charge payable by
Lessee under such Lease as and when the same becomes due and payable and such
default continues for a period of ten (10) days; or

    

     

     
(ii) Lessee fails to observe or perform any of the other obligations required to
be observed or performed by Lessee of such Lease or the inaccuracy in any
material respect
of any representation or warranty made by the Lessee in such Lease or in any
document or certificate furnished to the Lessor in connection therewith,
which
default or inaccuracy shall continue for a period of fifteen (15) days after
notice; or

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (iii)
Lessee makes an assignment for the benefit of creditors; admits in writing its
inability to pay its debts as they become due; files a voluntary petition in
bankruptcy; is adjudicated as a bankrupt; files a petition or answer seeking for
itself any reorganization, arrangement, composition, readjustment, liquidation,
dissolution, or similar relief under any present or future statute, law or
regulation, or files any answer admitting, or fails to deny the material
allegations of a petition filed against it for any such relief; consents to or
acquiesces in the appointment of a trustee, receiver, or liquidator of it or of
all or any substantial part of its assets or properties, or if it or its
shareholders shall take any action to effect its dissolution or liquidation;
or

    

    
      (iv) The
failure by Lessee, within thirty (30) days after the commencement of any
proceeding against Lessee seeking any reorganization, arrangement composition,
readjustment, liquidation, dissolution or similar relief under any present or
future statute, law or regulation, to obtain the dismissal of such proceeding,
or if within thirty (30) days after the appointment without Lessee's consent or
acquiescence of any trustee, receiver or liquidator of Lessee or of all or any
substantial part of its assets and properties, such appointment shall not be
vacated; or

    

    

    (v) The
default by Lessee under any other Lease or other agreement between Lessee and
Lessor, any Assignee or any Secured party.

    

    
      (b) Upon
the occurrence of any one or more Events of Default, Lessor, at its option, may
(1) proceed by appropriate court action or actions either at law or in equity to
enforce performance by Lessee of the applicable covenants and terms of the
applicable Lease, or
to recover from Lessee any and all damages or expenses, including reasonable
attorney's fees, which Lessor shall have sustained by reason of Lessee's default
in any covenant or convenants of the applicable Lease or on account of Lessor's
enforcement of its remedies thereunder, or (2) Lessor may declare this Master
lease Agreement in default, such declaration shall be by written notice to
Lessee and shall apply to all Leases hereunder except as specifically excepted
therefrom by Lessor in such declaration. Lessee hereby authorizes Lessor at any
time thereafter to enter with or without legal process any premises where
Equipment may be and take possession thereof without notice, and without being
liable to Lessee therefor, except that Lessor shall be liable for damages
resulting from the fault or negligence of Lessor, any Assignee, any Secured
party, or their respective agents and representatives in any such entry or
repossession. Lessee shall, without further demand, forthwith pay Lessor an
amount which is equal to any unpaid amount due on or before Lessor declaring the
Master Lease Agreement to be in default, plus as liquidated damages for loss of
a bargain and not as a penalty an amount equal to the Casualty Value for
Equipment (as defined in the Lease) computed as of the date Lessor declares this
Lease in default, together with interest (computed at the lesser of 1.5% per
month or the maximum allowable rate of interest permitted by law), plus all
attorney and court costs incurred by Lessor relating to the enforcement of its
rights under this Lease. After such noticed default, at the request of Lessor
and to the extent requested by Lessor, Lessee shall immediately comply with the
provisions of Section 8(d) of this Master Lease Agreement. Lessor may sell the
Equipment at private or public sale, in bulk or in parcels, with or without
notice, without having the Equipment present at the place of sale; or Lessor may
lease, otherwise dispose of or keep idle all or part of the Equipment subject,
however, to its obligation to mitigate damages; and Lessor may use Lessee's
premises for any or all of the foregoing without liability for rent, costs or
otherwise. The proceeds of sale, lease or other disposition, if any, of the
Equipment shall be applied (1) to all Lessor's costs, charges and expenses
incurred in taking, removing, holding, repairing and selling, leasing or
otherwise disposing of Equipment including attorney fees; then (2) to the extent
not previously paid by Lessee, to pay Lessor the Casualty Value for Equipment
and all other sums owed by Lessee under the Lease, including any unpaid rent and
indemnification then remaining unpaid hereon; then (3) to reimburse to Lessee
any such sums previously paid by Lessee as liquidated damages; (4) any surplus
shall be retained by Lessor. Lessee shall pay any deficiency in (l) and (2)
forthwith.
The exercise of any of the foregoing remedies by Lessor shall not
constitute a termination of this Master Lease Agreement unless Lessor so
notifies Lessee in writing.

    

     

    15.
MISCELLANEOUS.

     

    
      (a) This
Master Lease Agreement has been, and each Lease will have been made, executed
and delivered in the State of Texas and shall be governed and construed for all
purposes under and in accordance with the laws of such state.

    

    

    
      (b)
Lessor
and Lessee acknowledge that there are no agreements or
understandings, written or oral, between Lessor and Lessee with respect to the
Equipment, other than as set forth herein and in each Lease and that this Master
Lease Agreement and each Lease contains the entire agreement between Lessor and
Lessee with respect thereto.

    

    

    (c) This
Lease shalt be binding upon and inure to the benefit of the parties hereto and
their respective successors and assigns (as maybe permitted
hereunder).

    

    
      (d) Each
Lease maybe executed in one or more counterparts each of which shall be deemed
an original, but all such counterparts together shall constitute but one and the
same instrument. If Lessor grants a security interest in all or any part of a
Lease, the Equipment covered thereby and/or sums payable thereunder, only that
counterpart Lease marked "Original" shall be effective to transfer Lessor's
rights therein and all other counterparts shall be marked
"Duplicate".

    

    

    
      (e) All
notices, consents or requests desired or required to be given hereunder shall be
in writing and shall be deemed received upon the earlier of receipt or three
days after mailing if mailed postage prepaid by regular or airmail to either
party, as the case may be, at the address for such party set forth in the Lease
or at such changed address as may be subsequently submitted by written notice of
either party.

    

     

    (f) All
consents required to be contained in any Lease shall set forth such facts as
Lessor may require and the consent of Lessor shall not be unreasonably withheld.
Fair Market Value of the Equipment shall be determined by the Lessor and shall
be based upon its' value in continued use.

    

    
      (g) If
the Equipment delivered pursuant to any Lease contains any features not
specified therein, Lessee grants Lessor, at Lessor's option, the right to remove
or deactivate any of such features. Such removal or deactivation shall be
performed by the manufacturer or another party acceptable to Lessee, upon the
request of Lessor, at a time convenient to Lessee, provided that Lessee shall
not unreasonably delay the removal of such features.

    

     

    IN
WITNESS WHEREOF, the parties have executed this Master Lease Agreement on the
date first written above.

    
       

      
        
          	 	 	 	 	 	 	 
	
                  LESSEE:  
      

                   

                  BIOANALYTICAL
      SYSTEMS, INC.

                	 	 	
                  LESSOR:  
      

                   

                  FORUM
      FINANCIAL SERVICES, INC.

                	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	By:	
                   

                	 	 	By:	
                  
                  

                	 
	Title:	
                  VP-FINANCE

                	 	 	Title:	
                   

                	 
	 	
                   

                	 	 	 	
                   

                	 

        

      

      
         

      

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
    

     

    
      	FORUM FINANCIAL
      SERVICES, INC.	
              Schedule No.
      8174-01

            
	 	 

EQUIPMENT
SCHEDULE

     

    This
Equipment Schedule is made as of this 22nd day of January,
2010 ("Lease") between FORUM FINANCIAL SERVICES, INC., a Texas corporation,
having its principal place of business at 275 West Campbell Road, Suite 320,
Richardson, Texas 75080 ("Lessor") and Bioanalytical Systems, Inc., an Indiana
corporation, having its principal place of business at Purdue Research Park,
2701 Kent Avenue, West Lafayette, Indiana 47906 ("Lessee").

    

    Pursuant
to the terms and conditions set forth in the Master Lease Agreement dated as of
January 22, 2010 between Lessor and Lessee, Lessee agrees to lease the
below-described Equipment from Lessor, and Lessor, by acceptance of this Lease,
agrees to lease the Equipment to Lessee, on the terms set forth in this
Equipment Schedule. Consistent with the terms and conditions, Lessee's
obligations thereunder shall commence no later than the date of delivery of each
Unit of Equipment.

     

    1.
EQUIPMENT:

    
      
        	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                Item

                Number

              	
                Qty.

              	 	
                Mfg.             

              	
                Model

                Number

              	
                Serial

                Number(s)

              	
                Description

              	 	
                Monthly

                Rent

              	 	 	
                Equipment

                Value

              	 
	
                 

              	
                1 -
      3

              	 	3	 	
                SCIEX

              	
                API-3000

              	
                See
      Attachment

              	
                Mass
      Spectrophotometer

              	 	$	1,608.00	 	 	$	60,000.00	 
	 	
                4 -
      9

              	 	6	 	
                SCIEX

              	
                API-4000

              	 
      	
                Mass
      Spectrophotometer

              	 	$	6,438.00	 	 	$	240,000.00	 
	 	
                10

              	 	 1	 	
                Phytronix

              	
                LDTD

              	 
      	
                2008
      Laser Diode Thermo

              	 	$	563.00	 	 	$	21,000.00	 
	 	
                11-15

              	 	5	 	
                Micromass

              	
                Quattro
      LC

              	 
      	
                Desorption
      System 1998
      Mass Spectophotometer

              	 	$	1,610.00	 	 	$	60,000.00	 
	 	
                16
      - 18

              	 	3	 	
                Shimadzu

              	
                SCL-IOAVP

              	 
      	
                Auto
      Sampler Controller

              	 	$	966.00	 	 	$	36,000.00	 
	 	
                19
      - 24

              	 	6	 	
                Shimadzu

              	
                SIL-IOADVP

              	 
      	
                Auto
      Sampler

              	 	$	1,932.00	 	 	$	72,000.00	 
	 	
                25
      - 26

              	 	2	 	
                Thermo

              	
                TSQ
      Quantum Ultra

              	 
      	
                Mass
      Spectrophotometer

              	 	$	698.00	 	 	$	26,000.00	 
	 	
                 

              	 	 	 	 
      	 
      	 
      	 
      	 	 	 	 	 	 	 	 
	 	
                27

              	 	1	 	Waters	
                 

              	 
      	
                2007
      Acquity Ultra Performance

              	 	$	296.00	 	 	$	11,000.00	 
	 	
                28

              	 	1	 	
                SCIEX

              	
                AP1365

              	 
      	
                Solvent
      Manager

                Mass
      Spectrometer

              	 	$	671.00	 	 	$	25,000.00	 
	 	
                29

              	 	1	 	
                SCIEX

              	
                API-5000

              	 
      	
                Mass
      Spectrometer

              	 	$	2,682.00	 	 	$	100,000.00	 
	 	
                30
      - 35

              	 	6	 	
                Waters/Micromass

              	
                Quattro
      Ultima

              	 
      	
                2003
      Mass Spectrometer

              	 	$	1,036.00	 	 	$	38,600.00	 
	 	 	 	 	 	 
      	 
      	 
      	
                TOTAL:

              	 	$	18,500.00	 	 	$	689,600.00	 

      

    

     

    SEE ATTACHMENT "A" FOR EQUIPMENT DETAIL

     

    2. INITIAL TERM:                          36 Months

     

    3. TOTAL MONTHLY
RENT:                                                          $18,500.00

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    BIOANALYTICAL
SYSTEMS, INC.

    
    

    4.
EQUIPMENT LOCATION:

     

    Item #1 -
27 Bioanalytical Systems, Inc., Purdue Research Park, 2701 Kent Ave., W.
Lafayette, IN 47906

    Item #28
- 35: Bioanalytical Systems, Inc., Northwest, 3138 N.E. Rivergate, Bldg. 301C,
McMinnville, OR 97128

     

    5.
CASUALTY VALUE: See Annex A hereto.

     

    6. LEASE EXTENSION: Provided
that no Event of Default has occurred and is continuing hereunder, the Initial
Term shall be automatically extended for successive 90 day periods with respect
to all, but not less than all, Equipment listed above at the Monthly Rent
applicable to such Equipment, until either Lessor or Lessee shall give to the
other party 90 days prior written notice of termination effective at the end of
the Initial Term (or at the end of each term as extended).

     

    7.
ADDITIONAL PROVISIONS:

    

    a.)
Lessee agrees to remit to Lessor a Security Deposit of $74,000.00 upon execution
of this Equipment Schedule.

    

    b.) Upon
90 days receipt of written notice by Lessor, and provided no Event of Default
has occurred or is continuing hereunder, Lessee
shall have the option to purchase all, but not less than all, the Equipment for
$1.00 at the end of the Initial Term.

    

    c.) See
Attachment "A" hereto - Equipment Description 

     

    d.) See
Attachment "B" hereto - Final Agreement

     

    UNLESS
EXPRESSLY SET FORTH IN THIS SCHEDULE AND ATTACHED HERETO, THIS SCHEDULE TOGETHER
WITH THE MASTER LEASE AGREEMENT CONSTITUTES THE ENTIRE AGREEMENT BETWEEN THE
PARTIES AS TO THE LEASE AND EQUIPMENT. THIS LEASE CONSTITUTES AN OFFER BY LESSEE
TO LEASE FROM LESSOR AND SUCH OFFER MAY NOT BE REVOKED EXCEPT BY THE WRITTEN
CONSENT OF LESSOR. THIS LEASE SHALL BE DEEMED ACCEPTED BY LESSOR UPON ITS
EXECUTION HEREOF IN ITS OFFICE IN TEXAS.

    

    

    IN
WITNESS WHEREOF the parties have executed this Equipment Schedule. 

     

    
      
        	 	 	 	 	 	 	 
	
                LESSEE:  
      

                 

                BIOANALYTICAL
      SYSTEMS, INC.

              	 	 	
                LESSOR:  
      

                 

                FORUM
      FINANCIAL SERVICES, INC.

              	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	By:	
                 

              	 	 	By:	
                  

              	 
	Title:	
                VP-FINANCE

              	 	 	Title:

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