<SEC-DOCUMENT>0001144204-15-000414.txt : 20150105
<SEC-HEADER>0001144204-15-000414.hdr.sgml : 20150105
<ACCEPTANCE-DATETIME>20150105160816
ACCESSION NUMBER:		0001144204-15-000414
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		5
CONFORMED PERIOD OF REPORT:	20141229
ITEM INFORMATION:		Entry into a Material Definitive Agreement
ITEM INFORMATION:		Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
ITEM INFORMATION:		Other Events
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20150105
DATE AS OF CHANGE:		20150105

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			BARRETT BUSINESS SERVICES INC
		CENTRAL INDEX KEY:			0000902791
		STANDARD INDUSTRIAL CLASSIFICATION:	SERVICES-HELP SUPPLY SERVICES [7363]
		IRS NUMBER:				520812977
		STATE OF INCORPORATION:			MD
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-21886
		FILM NUMBER:		15504765

	BUSINESS ADDRESS:	
		STREET 1:		8100 NE PARKWAY DRIVE
		STREET 2:		SUITE 200
		CITY:			VANCOUVER
		STATE:			WA
		ZIP:			98662
		BUSINESS PHONE:		(800) 494-5669

	MAIL ADDRESS:	
		STREET 1:		8100 NE PARKWAY DRIVE
		STREET 2:		SUITE 200
		CITY:			VANCOUVER
		STATE:			WA
		ZIP:			98662
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>v397968_8k.htm
<DESCRIPTION>FORM 8-K
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">UNITED STATES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">SECURITIES AND EXCHANGE COMMISSION</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">Washington, D.C. 20549<BR>
___________________________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">FORM 8-K</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">CURRENT REPORT</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">Pursuant to Section 13 or 15(d) of</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">the Securities Exchange Act of 1934</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">Date of Report (Date of earliest event reported):</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">December 29, 2014</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">BARRETT BUSINESS SERVICES, INC.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">(Exact name of registrant as specified in
charter)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">Maryland</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">(State or other jurisdiction of incorporation)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">0-21886</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">(SEC File Number)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">52-0812977</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(IRS Employer Identification No.)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 90%; border-collapse: collapse; margin-left: 0.5in">
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    <TD STYLE="width: 50%">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">8100 N.E. Parkway Drive, Suite 200</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Vancouver, Washington</P></TD>
    <TD STYLE="width: 50%; text-align: center"><BR>
98662</TD>
    </TR>
<TR STYLE="vertical-align: top">
    <TD>(Address of principal executive offices)</TD>
    <TD STYLE="text-align: center">(Zip Code)</TD>
    </TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Registrant's telephone number, including
area code:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(360) 828-0700</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Check the appropriate box below if the Form&nbsp;8-K
filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Wingdings">&uml;</FONT></TD><TD STYLE="text-align: justify">Written communications pursuant to Rule&nbsp;425 under
the Securities Act (17 CFR 230.425)</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Wingdings">&uml;</FONT></TD><TD STYLE="text-align: justify">Soliciting material pursuant to Rule&nbsp;14a-12 under
the Exchange Act (17 CFR 240.14a-12)</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Wingdings">&uml;</FONT></TD><TD STYLE="text-align: justify">Pre-commencement communications pursuant to Rule&nbsp;14d-2(b)
under the Exchange Act (17&nbsp;CFR 240.14d-2(b))</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.25in; text-indent: -0.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Wingdings">&uml;</FONT></TD><TD STYLE="text-align: justify">Pre-commencement communications pursuant to Rule&nbsp;13e-4(c)
under the Exchange Act (17&nbsp;CFR 240.13e-4(c))</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.25in; text-indent: -0.25in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Item 1.01 Entry into a Material Definitive Agreement.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The disclosure included under Item 2.03 is incorporated by reference.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Item 2.03. Creation of a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet Arrangement of a Registrant.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On December 29, 2014, Barrett Business Services, Inc. (the &quot;Company&quot;),
entered into a new credit agreement (the &quot;Agreement&quot;) with its principal bank, Wells Fargo Bank, National Association
(the &quot;Bank&quot;), which supersedes its previous credit agreement with the Bank dated November 1, 2012.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Agreement provides for:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">(a) a revolving line of credit with an initial borrowing capacity
of up to $14,000,000 to be used to finance working capital, with a $5,000,000 subfeature for unsecured standby letters of credit,
maturing October 1, 2017, and evidenced by a revolving line of credit note dated December 29, 2014 (the &quot;Line of Credit Note&quot;);</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">(b) a term loan in the amount of $40,000,000 to be used to fund
workers' compensation insurance reserves, maturing December 31, 2016, and evidenced by term note 2 dated December&nbsp;29, 2014
(&quot;Term Note 2&quot;);</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">(c) an increase to a total of $114,300,000 in cash-secured letters
of credit, which remain subject to the standby letter of credit agreement dated September 18, 2012, between the Company and the
Bank (the &quot;Standby Letter of Credit Agreement&quot;); and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">(d) the continuance of a term loan with an outstanding principal
balance as of December 29, 2014, of $5,052,125, evidenced by a term note dated November 1, 2012, as amended by a first modification
of term note dated December 29, 2014 (as amended, &quot;Term Note 1&quot;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Advances under the Line of Credit Note bear interest as selected
by the Company of either (a) a daily floating rate of one month LIBOR plus 2% or (b) a fixed rate of LIBOR plus 2%. The Agreement
provides for a fee of 0.35% per year on the daily unused amount of the line of credit, payable quarterly, and a fee of 1.75% of
the face amount of each letter of credit issued under the line of credit. Each month-end balance on the revolving line of credit
(including outstanding standby letters of credit) may not exceed 80% of eligible accounts receivable, defined as total accounts
receivable times 15.7%.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The principal balance of Term Note 2 bears interest at LIBOR
plus 4%, fixed monthly. The principal amount of Term Loan 2 is payable in installments as follows: $3,000,000 on June&nbsp;30,
2015; $7,000,000 on September 30, 2015; $15,000,000 on December 31, 2015; $5,000,000 on June 30, 2016; and the remaining unpaid
balance on December 31, 2016. The Company paid a commitment fee of $400,000 with respect to Term Note 2. An additional principal
payment may be required in April of 2016 equal to 65% of the amount by which excess cash flow (as defined in the Agreement) exceeds
$15,000,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Upon issuance of each insurance letter of credit under the Standby
Letter of Credit Agreement, a fee of 0.95% of the face amount will be assessed. The insurance letters of credit guarantee 60% of
the surety bonds issued to the State of California in connection with the Company's workers' compensation payment obligations described
in Item 8.01 below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Line of Credit Note and Term Note 2 are secured by collateral
consisting of the Company's accounts receivable and other rights to receive payment, general intangibles, inventory and equipment.
The collateral securing the cash-secured standby letters of credit consists of all time deposits held at the Bank covering 100%
of the face amount of outstanding letters of credit.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Agreement requires the satisfaction of certain financial
covenants as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 1.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>A minimum Fixed Charge Coverage ratio (as defined in the Agreement) of at least 1.5:1.0, measured quarterly on a rolling four-quarter
basis; and</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.75in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 1.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>A ratio of restricted and unrestricted cash and marketable securities to workers' compensation and safety incentive liabilities
of at least 1.0:1.0, measured quarterly;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Agreement also includes certain negative covenants as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 1.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>A prohibition on incurring additional indebtedness without the prior approval of the Bank, other than up to $200,000 per year
in purchase money financing;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 1.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>A prohibition on repurchases of the Company's common stock;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 1.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>A prohibition on increasing quarterly cash dividends above $.22 per share; also, cash dividends may be paid only so long as
there is no default by the Company and payment would not cause a default; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 1.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD>Capital expenditures may not exceed a total of $5,000,000 in 2015 and $4,000,000 in 2016.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Agreement also includes customary events of default. If
an event of default under the Agreement occurs and is continuing, the Bank may declare any outstanding obligations under the Agreement
to be immediately due and payable. Outstanding amounts would also be subject to a default interest rate equal to 4% above the rate
of interest otherwise applicable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The descriptions set forth herein of the terms and conditions
of the Agreement, Term Note 1, Term Note 2, the Revolving Line of Credit Note, and the Standby Letter of Credit Agreement are qualified
in their entirety by reference to the full text of the Agreement, Term Note 1 (with first modification), Term Note&nbsp;2, the
Revolving Line of Credit Note, and the Standby Letter of Credit Agreement, which are filed with this report as exhibits.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Item 8.01. Other Events.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Effective December 30, 2014, the Company transferred cash in
the amount of $75 million to its wholly owned subsidiary Associated Insurance Company for Excess, in order to provide additional
collateral for the Company's required security deposit in California with respect to its obligations regarding the payment of workers'
compensation claims. The Company's required security deposit in California at December 31, 2014, increased by approximately $85.9
million to a total of approximately $190.6 million.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Item 9.01. Financial Statements and Exhibits.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">(d) Exhibits. The following exhibits are filed with this Form
8-K:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in">10.1</TD><TD>Credit Agreement, dated December 29, 2014, between the Company and Wells Fargo Bank, National Association (&quot;Wells Fargo&quot;).</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in">10.2</TD><TD>Term Note, dated November 1, 2012, of the Company. Incorporated by reference to Exhibit 4.4 to the Company's Quarterly Report
on Form 10-Q for the quarter ended September&nbsp;30, 2012.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in">10.3</TD><TD>First Modification to Term Note, dated December 29, 2014, of the Company.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in">10.4</TD><TD>Term Note 2, dated December 29, 2014, of the Company.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in">10.5</TD><TD>Revolving Line of Credit Note, dated December 29, 2014, of the Company.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.5in">10.6</TD><TD>Standby Letter of Credit Agreement dated as of September 18, 2012, between the Company and Wells Fargo. Incorporated by reference
to Exhibit 4.3 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2012.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">SIGNATURES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 1in">Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2"><FONT STYLE="font-size: 10pt">BARRETT BUSINESS SERVICES, INC.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%">&nbsp;</TD>
    <TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 48%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><FONT STYLE="font-size: 10pt">Dated:&nbsp;&nbsp;January 5, 2015</FONT></TD>
    <TD><FONT STYLE="font-size: 10pt">By:&nbsp;</FONT>&nbsp;&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt">/s/ James D. Miller</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">James D. Miller</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-size: 10pt">Vice President-Finance, Treasurer and Secretary</FONT></TD></TR>
</TABLE>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>2
<FILENAME>v397968_ex10-1.htm
<DESCRIPTION>EXHIBIT 10.1
<TEXT>
<HTML>
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<P STYLE="margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>Exhibit 10.1</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">CREDIT AGREEMENT</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">THIS CREDIT AGREEMENT (this &ldquo;Agreement&rdquo;)
is entered into effective as of December&nbsp;29,&nbsp;2014, by and between BARRETT BUSINESS SERVICES, INC., a Maryland corporation
(&ldquo;Borrower&rdquo;), and WELLS FARGO BANK, NATIONAL ASSOCIATION (&ldquo;Bank&rdquo;). This Agreement amends, restates and
supersedes in its entirety that certain Restated Credit Agreement dated November 1, 2012 by and between Borrower and Bank, as such
may have been amended from time to time prior to the date hereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>RECITALS</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">Borrower has requested that Bank extend
or continue to extend credit to Borrower as described below, and Bank has agreed to provide such credit to Borrower on the terms
and conditions contained herein.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">NOW, THEREFORE, for valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Bank and Borrower hereby agree as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>ARTICLE I</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>CREDIT TERMS</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 1.1.&#9;LINE OF CREDIT.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(a)&#9;<U>Line of Credit</U>. Subject to the terms and conditions
of this Agreement, Bank hereby agrees to make advances to Borrower from time to time up to and including October 1, 2017, not to
exceed at any time the aggregate principal amount of Fourteen Million Dollars ($14,000,000.00) (&ldquo;Line of Credit&rdquo;),
the proceeds of which shall be used to finance working capital for Borrower. Borrower&rsquo;s obligation to repay advances under
the Line of Credit shall be evidenced by a promissory note dated as of December&nbsp;29,&nbsp;2014 (&ldquo;Line of Credit Note&rdquo;),
all terms of which are incorporated herein by this reference.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(b)&#9;<U>Letter of Credit Subfeature</U>. As a subfeature
under the Line of Credit, Bank agrees from time to time during the term thereof to issue or cause an affiliate to issue standby
letters of credit for the account of Borrower (each, a &ldquo;Line of Credit Letter of Credit&rdquo; and collectively, &ldquo;Line
of Credit Letters of Credit&rdquo;); provided however, that the aggregate undrawn amount of all outstanding Line of Credit Letters
of Credit (including without limitation the Existing Line of Credit Letters of Credit, as that term is defined in Section 1.1(b)(ii)
below) shall not at any time exceed Five Million Dollars ($5,000,000.00).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.7in">(i)&#9;The form and substance of each Line of Credit Letter
of Credit shall be subject to approval by Bank, in its sole discretion. Each Line of Credit Letter of Credit shall be issued for
a term not to exceed three hundred eighty (380) days, as designated by Borrower; provided however, that no Line of Credit Letter
of Credit shall have an expiration date more than three hundred sixty-five (365) days beyond the maturity date of the Line of Credit.
The undrawn amount of all Line of Credit Letters of Credit (including the Existing Line of Credit Letters of Credit) shall be reserved
under the Line of Credit and shall not be available for borrowings thereunder. Each Line of Credit Letter of Credit shall be subject
to the additional terms and conditions of the Letter of Credit Agreement (as that term is defined in Section&nbsp;1.1(b)(ii) below),
applications and any related documents required by Bank in connection with the issuance thereof. Each drawing paid under a Line
of Credit Letter of Credit shall be deemed an advance under the Line of Credit and shall be repaid by Borrower in accordance with
the terms and conditions of this Agreement applicable to such advances; provided however, that if advances under the Line of Credit
are not available, for any reason, at the time any drawing is paid, then Borrower shall immediately pay to Bank the full amount
drawn, together with interest thereon from the date such drawing is paid to the date such amount is fully repaid by Borrower, at
the rate of interest applicable to advances under the Line of Credit. In such event, Borrower agrees that Bank, in its sole discretion,
may debit any account maintained by Borrower with Bank for the amount of any such drawing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.7in">(ii)&#9;Bank has issued or caused an affiliate to issue
the following standby letters of credit (each an &ldquo;Existing Line of Credit Letter of Credit&rdquo; and collectively, the &ldquo;Existing
Line of Credit Letters of Credit&rdquo;), each of which is subject to the terms of that certain Standby Letter of Credit Agreement
(Credit Agreement/Loan Agreement Version) between Bank and Borrower dated September 18, 2012, as amended (the &ldquo;Letter of
Credit Agreement&rdquo;), together with applications and any related documents required by Bank in connection with the issuance
(and any renewal) thereof, and is outstanding as of the date hereof: (A) Standby Letter of Credit No. NZS504587 in the amount of
Two Million Five Hundred Thousand Dollars ($2,500,000.00) dated December 8, 2003, as amended from time to time, and (B) Standby
Letter of Credit No. NZS401574 in the amount of One Million Six Hundred Fifty Thousand Dollars ($1,650,000.00) dated June 20, 2001,
as amended from time to time.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(c)&#9;<U>Borrowing and Repayment</U>. Borrower may from
time to time during the term of the Line of Credit borrow, partially or wholly repay its outstanding borrowings, and reborrow,
subject to all of the limitations, terms and conditions contained herein or in the Line of Credit Note; provided however, that
the total outstanding borrowings under the Line of Credit shall not at any time exceed the maximum principal amount available thereunder,
as set forth above.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 1.2&#9;TERM LOAN 1.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(a)&#9;<U>Term Loan 1</U>. Bank has made a loan to Borrower
in the original principal amount of Five Million Five Hundred Twelve Thousand Five Hundred Dollars ($5,512,500.00) (&ldquo;Term&nbsp;Loan&nbsp;1&rdquo;),
on which the outstanding principal balance as of the date hereof is $5,053,125.00. Borrower&rsquo;s obligation to repay Term Loan
1 is evidenced by a promissory note dated as of November 1, 2012, as amended (&ldquo;Term Note 1&rdquo;), all terms of which are
incorporated herein by this reference. Any reference in Term Note 1 to any prior loan agreement between Bank and Borrower shall
be deemed a reference to this Agreement. Subject to the terms and conditions of this Agreement, Bank hereby confirms that Term
Loan 1 remains in full force and effect.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(b)&#9;<U>Repayment</U>. Principal and interest on Term
Loan 1 shall be repaid in accordance with the provisions of Term Note 1.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(c)&#9;<U>Prepayment</U>. Borrower may prepay principal
on Term Loan 1 solely in accordance with the provisions of Term Note 1.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 1.3.&#9;TERM LOAN 2.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(a)&#9;<U>Term Loan 2</U>. Subject to the terms and conditions
of this Agreement, Bank hereby agrees to make a loan to Borrower in the principal amount of Forty Million Dollars ($40,000,000.00)
(&ldquo;Term Loan 2&rdquo;), the proceeds of which shall be used to fund insurance reserves of Borrower and its wholly-owned subsidiaries.
Borrower&rsquo;s obligation to repay Term&nbsp;Loan&nbsp;2 shall be evidenced by a promissory note dated as of December 29, 2014
(&ldquo;Term Note 2&rdquo;), all terms of which are incorporated herein by this reference. Bank&rsquo;s commitment to grant the
Term Loan 2 shall terminate on January 31, 2015.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(b)&#9;<U>Repayment</U>. Principal and interest on Term
Loan 2 shall be repaid in accordance with the provisions of Term Note 2.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(c)&#9;<U>Prepayment</U>. Borrower may prepay principal
on Term Loan 2 solely in accordance with the provisions of Term Note 2.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 1.4.&#9;INSURANCE LETTERS OF CREDIT.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(a)&#9;<U>Insurance Letters of Credit</U>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.7in">(i)&#9;<U>Existing Insurance Letters of Credit</U>. In addition
to the Existing Line of Credit Letters of Credit, Bank has issued or caused an affiliate to issue the following standby letters
of credit for the account of Borrower, each of which is subject to the terms of the Letter of Credit Agreement and is outstanding
as of the date hereof (each an &ldquo;Existing Insurance Letter of Credit&rdquo; and collectively, the &ldquo;Existing Insurance
Letters of Credit&rdquo;): (A)&nbsp;Standby Letter of Credit No. IS0133585U in the amount of Five Million Dollars ($5,000,000.00),
for the benefit of Atlantic Specialty Insurance Company dated December&nbsp;19,&nbsp;2013, as amended from time to time (the &ldquo;Existing
Atlantic SLC&rdquo;); (B)&nbsp;Standby Letter of Credit No. IS0133605U in the amount of Five Million Dollars ($5,000,000.00), for
the benefit of Argonaut Insurance Co. dated December 19, 2013, as amended from time to time (the &ldquo;Existing Argonaut SLC&rdquo;);
and (C)&nbsp;Standby Letter of Credit No. IS0133565U in the amount of Ten Million Nine Hundred Forty-Three Thousand Four Hundred
Sixty-Six and 20/100 Dollars ($10,943,466.20) for the benefit of Westchester Fire Insurance Company dated December 19, 2013, as
amended from time to time (the &ldquo;Existing Westchester SLC&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.7in">(ii)&#9;<U>Amended Insurance Letters of Credit</U>. Subject
to the terms of this Agreement, Bank hereby agrees, for the benefit of Borrower to secure a portion of Borrower&rsquo;s obligations
to issuers of surety bonds issued to the Self Insurance Plans of the State of California, to amend or cause an affiliate to amend:
(A) the Existing Atlantic SLC to increase the amount thereof from Five Million Dollars ($5,000,000.00) to Fifteen Million Dollars
($15,000,000.00); (B) the Existing Argonaut SLC to increase the amount thereof from Five Million Dollars ($5,000,000.00) to Fifteen
Million Dollars ($15,000,000.00); and (C) the Existing Westchester SLC to increase the amount thereof from Ten Million Nine Hundred
Forty-Three Thousand Four Hundred Sixty-Six and 20/100 Dollars ($10,943,466.20) to Eighty-Four Million Three Hundred Thirty-Four
Thousand Six Hundred Sixty and 20/100 Dollars ($84,334,660.20). The form and substance of each such amended Existing Insurance
Letter of Credit shall be subject to approval by Bank, in its sole discretion. For purposes of this Agreement, &ldquo;Insurance
Letters of Credit&rdquo; means, collectively, the Existing Insurance Letters of Credit, amended as contemplated in this Section
1.4(a)(ii).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.7in">(iii)&#9;<U>Additional Terms</U>. Each of the Insurance
Letters of Credit shall remain subject to the additional terms of the Letter of Credit Agreement, applications and any related
documents required by Bank in connection with the issuance (and any renewal) thereof. Notwithstanding the provisions of any Insurance
Letter of Credit regarding automatic extension of its expiration date, Bank may, at its sole option, give notice to the beneficiary
thereof in accordance with the terms of such Insurance Letter of Credit that Bank has elected not to renew such Insurance Letter
of Credit beyond its current expiration date (or any other subsequent expiration date that may be agreed to by Bank at Bank&rsquo;s
sole discretion). If Borrower does not at any time want any Insurance Letter of Credit to be renewed, Borrower will so notify Bank
at least fifteen (15) calendar days before Bank is to notify the beneficiary thereof of such nonrenewal pursuant to the terms of
such Insurance Letter of Credit.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(b)&#9;<U>Repayment of Drafts</U>. Each drawing paid under
the Insurance Letters of Credit shall be repaid by Borrower in accordance with the provisions of the Letter of Credit Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 1.5.&#9;INTEREST/FEES.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(a)&#9;<U>Interest</U>. The outstanding principal balance
of the Line of Credit, Term Loan 1 and Term Loan 2 shall bear interest, and the amount of each drawing paid under any Line of Credit
Letter of Credit and any Insurance Letter of Credit shall bear interest from the date such drawing is paid to the date such amount
is fully repaid by Borrower, at the rate of interest set forth in each promissory note or other instrument or document executed
in connection therewith.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(b)&#9;<U>Computation and Payment</U>. Interest shall be
computed on the basis of a 360-day year, actual days elapsed. Interest shall be payable at the times and place set forth in each
promissory note or other instrument or document required hereby.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(c)&#9;<U>Commitment Fee</U>. Borrower shall pay to Bank
a non-refundable commitment fee for Term Loan 2 equal to Four Hundred Thousand Dollars ($400,000.00), which fee shall be due and
payable in full on the earlier of (i) the date of funding of Term Loan 2, or (ii)&nbsp;January&nbsp;15,&nbsp;2015.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(d)&#9;<U>Unused Commitment Fee</U>. Borrower shall pay
to Bank a fee equal to thirty-five one hundredths of one percent (0.35%) per annum (computed on the basis of a 360-day year, actual
days elapsed) on the daily unused amount of the Line of Credit, which fee shall be calculated on a quarterly basis by Bank and
shall be due and payable by Borrower in arrears on the first day of each quarter, commencing on April 1, 2015.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(e)&#9;<U>Line of Credit Letter of Credit Fees</U>. Borrower
shall pay to Bank (i)&nbsp;fees upon the issuance of each Line of Credit Letter of Credit equal to one and three-quarters percent
(1.75%) per annum (computed on the basis of a 360-day year, actual days elapsed) of the face amount thereof, and (ii)&nbsp;fees
upon the payment or negotiation of each drawing under any Line of Credit Letter of Credit and fees upon the occurrence of any other
activity with respect to any Line of Credit Letter of Credit (including without limitation, the transfer, amendment or cancellation
of any Line of Credit Letter of Credit) determined in accordance with Bank's standard fees and charges then in effect for such
activity.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(f)&#9;<U>Insurance Letter of Credit Fees</U>. Borrower
shall pay to Bank (i)&nbsp;fees upon the issuance of each Insurance Letter of Credit equal to ninety-five one hundredths of one
percent (0.95%) per annum (computed on the basis of a 360-day year, actual days elapsed) of the face amount thereof, and (ii)&nbsp;fees
upon the payment or negotiation of each drawing under any Insurance Letter of Credit and fees upon the occurrence of any other
activity with respect to any Insurance Letter of Credit (including without limitation, the transfer, amendment or cancellation
of any Insurance Letter of Credit) determined in accordance with Bank&rsquo;s standard fees and charges then in effect for such
activity.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 1.6.&#9;COLLECTION OF PAYMENTS. Borrower authorizes
Bank to collect all principal, interest and fees due under each credit subject hereto by debiting Borrower&rsquo;s deposit account
number 4159583848 with Bank, or any other deposit account maintained by Borrower with Bank, for the full amount thereof. Should
there be insufficient funds in any such deposit account to pay all such sums when due, the full amount of such deficiency shall
be immediately due and payable by Borrower.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 1.7.&#9;COLLATERAL.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">As security for all indebtedness and other
obligations of Borrower to Bank, Borrower shall grant, and hereby confirms its prior grant, to Bank security interests of first
priority in all Borrower&rsquo;s accounts receivable and other rights to payment, general intangibles, inventory and equipment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">As security for all indebtedness and other
obligations of Borrower to Bank under Term&nbsp;Loan&nbsp;1, Borrower shall grant, and hereby confirms its prior grant, to Bank
a lien of not less than first priority on that certain real property located at 8100 NE Parkway Drive, Vancouver, Washington 98662.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">As security for all indebtedness and other
obligations of Borrower to Bank under the Insurance Letters of Credit, Borrower shall cause Associated Insurance Company for Excess,
an Arizona corporation (&ldquo;AICE&rdquo;), to grant, and confirm its prior grant, to Bank security interests of first priority
in (i) deposit account number xxxxxxxxxx with Bank (&ldquo;AICE Deposit Account No. 1&rdquo;), (ii) deposit account number xxxxxxxxx
with Bank (&ldquo;AICE Deposit Account No. 2&rdquo;), and (iii) deposit account number xxxxxxxxx with Bank (&ldquo;AICE Deposit
Account No. 3&rdquo;) (the deposit accounts described in clauses (i) through (iii) in this sentence, collectively, the &ldquo;AICE
Deposit Accounts&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">All of the foregoing shall be evidenced by and subject to the
terms of such security agreements, financing statements, deeds or mortgages, and other documents as Bank shall reasonably require,
all in form and substance satisfactory to Bank. Borrower shall pay to Bank immediately upon demand the full amount of all charges,
costs and expenses (to include fees paid to third parties and all allocated costs of Bank personnel), expended or incurred by Bank
in connection with any of the foregoing security, including without limitation, filing and recording fees and costs of appraisals,
audits and title insurance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>ARTICLE II</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>REPRESENTATIONS AND WARRANTIES</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">Borrower makes the following representations
and warranties to Bank, which representations and warranties shall survive the execution of this Agreement and shall continue in
full force and effect until the full and final payment, and satisfaction and discharge, of all obligations of Borrower to Bank
subject to this Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 2.1.&#9;LEGAL STATUS. Borrower is a corporation,
duly organized and existing and in good standing under the laws of Maryland, and is qualified or licensed to do business (and is
in good standing as a foreign corporation, if applicable) in all jurisdictions in which such qualification or licensing is required
or in which the failure to so qualify or to be so licensed could have a material adverse effect on Borrower. Each of the Affiliates
(as that term is defined in Section 4.3(b) below) is a corporation, duly organized and existing and in good standing under the
laws of the state of its incorporation, and is qualified or licensed to do business (and is in good standing as a foreign corporation,
if applicable) in all jurisdictions in which such qualification or licensing is required or in which the failure to so qualify
or to be so licensed could have a material adverse effect, individually or in the aggregate, on each of the Affiliates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 2.2.&#9;AUTHORIZATION AND VALIDITY. This Agreement
and each promissory note, contract, instrument and other document required hereby or at any time hereafter delivered to Bank in
connection herewith (collectively, the &ldquo;Loan Documents&rdquo;) have been duly authorized, and upon their execution and delivery
in accordance with the provisions hereof will constitute legal, valid and binding agreements and obligations of Borrower or the
party which executes the same, enforceable in accordance with their respective terms.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 2.3.&#9;NO VIOLATION. The execution, delivery and
performance by Borrower of each of the Loan Documents do not violate any provision of any law or regulation, or contravene any
provision of the Articles of Incorporation or Bylaws of Borrower or any of its Affiliates, or result in any breach of or default
under any contract, obligation, indenture or other instrument to which Borrower or any of the Affiliates is a party or by which
Borrower or any of the Affiliates may be bound.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 2.4.&#9;LITIGATION. There are no pending, or to
the best of Borrower's knowledge threatened, actions, claims, investigations, suits or proceedings by or before any governmental
authority, arbitrator, court or administrative agency which could have a material adverse effect on the financial condition or
operation of Borrower or any of the Affiliates other than those disclosed by Borrower to Bank in writing prior to the date hereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 2.5.&#9;CORRECTNESS OF FINANCIAL STATEMENT. The
annual financial statement of Borrower dated December 31, 2013, and all interim financial statements delivered to Bank since said
date, true copies of which have been delivered by Borrower to Bank prior to the date hereof, (a) are complete and correct and present
fairly the financial condition of Borrower, (b) disclose all liabilities of Borrower that are required to be reflected or reserved
against under generally accepted accounting principles, whether liquidated or unliquidated, fixed or contingent, and (c) have been
prepared in accordance with generally accepted accounting principles consistently applied. Since the dates of such financial statements
there has been no material adverse change in the financial condition of Borrower or any of its Affiliates, nor has Borrower or
any of its Affiliates mortgaged, pledged, granted a security interest in or otherwise encumbered any of its assets or properties
except in favor of Bank or as otherwise permitted by Bank in writing. As of the date hereof, Borrower is solvent and, following
the consummation of the transactions contemplated herein, will continue to be solvent.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 2.6.&#9;INCOME TAX RETURNS. Borrower has no knowledge
of any pending assessments or adjustments of its income tax payable with respect to any year.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 2.7.&#9;NO SUBORDINATION. There is no agreement,
indenture, contract or instrument to which Borrower is a party or by which Borrower may be bound that requires the subordination
in right of payment of any of Borrower&rsquo;s obligations subject to this Agreement to any other obligation of Borrower.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 2.8.&#9;PERMITS, FRANCHISES. Borrower and each of
the Affiliates possesses, and will hereafter possess, all permits, consents, approvals, franchises and licenses required and rights
to all trademarks, trade names, patents, and fictitious names, if any, necessary to enable it to conduct the business in which
it is now engaged in compliance with applicable law.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 2.9.&#9;ERISA. Borrower is in compliance in all
material respects with all applicable provisions of the Employee Retirement Income Security Act of 1974, as amended or recodified
from time to time (&ldquo;ERISA&rdquo;); Borrower has not violated any provision of any defined employee pension benefit plan (as
defined in ERISA) maintained or contributed to by Borrower (each, a &ldquo;Plan&rdquo;); no Reportable Event as defined in ERISA
has occurred and is continuing with respect to any Plan initiated by Borrower; Borrower has met its minimum funding requirements
under ERISA with respect to each Plan; and each Plan will be able to fulfill its benefit obligations as they come due in accordance
with the Plan documents and under generally accepted accounting principles.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 2.10.&#9;OTHER OBLIGATIONS. Neither Borrower nor
any of the Affiliates is in default on any obligation for borrowed money, any purchase money obligation or any other material lease,
commitment, contract, instrument or obligation.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 2.11.&#9;ENVIRONMENTAL MATTERS. Except as disclosed
by Borrower to Bank in writing prior to the date hereof, Borrower is in compliance in all material respects with all applicable
federal or state environmental, hazardous waste, health and safety statutes, and any rules or regulations adopted pursuant thereto,
which govern or affect any of Borrower&rsquo;s operations and/or properties, including without limitation, the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, the Superfund Amendments and Reauthorization Act of 1986, the Federal Resource
Conservation and Recovery Act of 1976, and the Federal Toxic Substances Control Act, as any of the same may be amended, modified
or supplemented from time to time. None of the operations of Borrower is the subject of any federal or state investigation evaluating
whether any remedial action involving a material expenditure is needed to respond to a release of any toxic or hazardous waste
or substance into the environment. Borrower has no material contingent liability in connection with any release of any toxic or
hazardous waste or substance into the environment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 2.12.&#9;REAL PROPERTY COLLATERAL. Except as disclosed
by Borrower to Bank in writing prior to the date hereof, with respect to any real property collateral required hereby:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(a)&#9;All taxes, governmental assessments, insurance premiums,
and water, sewer and municipal charges, and rents (if any) which previously became due and owing in respect thereof have been paid
as of the date hereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(b)&#9;There are no construction or similar liens or claims
which have been filed for work, labor or material (and no rights are outstanding that under law could give rise to any such lien)
which affect all or any interest in any such real property and which are or may be prior to or equal to the lien thereon in favor
of Bank.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(c)&#9;None of the improvements which were included for
purpose of determining the appraised value of any such real property lies outside of the boundaries and/or building restriction
lines thereof, and no improvements on adjoining properties materially encroach upon any such real property.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(d)&#9;There is no pending, or to the best of Borrower's
knowledge threatened, proceeding for the total or partial condemnation of all or any portion of any such real property, and all
such real property is in good repair and free and clear of any damage that would materially and adversely affect the value thereof
as security and/or the intended use thereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>ARTICLE III</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>CONDITIONS</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 3.1.&#9;CONDITIONS OF INITIAL EXTENSION OF CREDIT.
The obligation of Bank to extend any credit contemplated by this Agreement is subject to the fulfillment to Bank's satisfaction
of all of the following conditions:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(a)&#9;<U>Approval of Bank Counsel</U>. All legal matters
incidental to the extension of credit by Bank shall be satisfactory to Bank's counsel.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(b)&#9;<U>Documentation</U>. Bank shall have received, in
form and substance satisfactory to Bank, each of the following, duly executed:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.7in">(i)&#9;This Agreement and each
promissory note or other instrument or document required hereby;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.7in">(ii)&#9;Second Amended and Restated
Third Party Security Agreement: Specific Rights to Payment;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.7in">(iii)&#9;First Modification to
Term Note;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.7in">(iv)&#9;Corporate Resolution:
Borrowing;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.7in">(v)&#9;Incumbency Certificate;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.7in">(vi)&#9;Corporate Resolution:
Third Party Collateral [AICE];</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.7in">(vii)&#9;Incumbency Certificate
[AICE]; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.7in">(viii)&#9;Such other documents
as Bank may require under any other Section of this Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(c)&#9;<U>Financial Condition</U>. There shall have been
no material adverse change, as determined by Bank, in the financial condition or business of Borrower, any of the Affiliates or
any Third Party Obligor hereunder, if any, nor any material decline, as determined by Bank, in the market value of any collateral
required hereunder or a substantial or material portion of the assets of Borrower, any of the Affiliates, or any such Third Party
Obligor, if any.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(d)&#9;<U>Insurance</U>. Borrower shall have delivered to
Bank evidence of insurance coverage, in form, substance, amounts, covering risks and issued by companies satisfactory to Bank,
and where required by Bank, with lender loss payable endorsements in favor of Bank, including without limitation, policies of fire
and extended coverage insurance covering all real property collateral required hereby, with replacement cost and mortgagee loss
payable endorsements, and such policies of insurance against specific hazards affecting any such real property, including terrorism,
as may be required by governmental regulation or Bank.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(e)&#9;<U>Deposit Account Funds</U>. Borrower shall have
deposited, or caused AICE to deposit, into AICE Deposit Account No. 3, in immediately available funds, cash in an amount equal
to $93,391,194.00 as a time deposit for a period not less than three (3) months following the date hereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(f)&#9;<U>Issuance of Surety Bonds</U>. Each issuer of the
surety bonds who are beneficiaries of the Insurance Letters of Credit shall be irrevocably obligated to issue, subject only to
such issuer&rsquo;s receipt of the respective Insurance Letters of Credit, surety bonds to the State of California Department of
Industrial Relations Office of Self Insurance Plans (&ldquo;OSIP&rdquo;) in satisfaction of Borrower&rsquo;s security deposit required
by OSIP with respect to worker&rsquo;s compensation obligations in the State of California in the aggregate dollar amount of $190,557,767.00
comprised of: (i)&nbsp;a surety bond in the amount of $25,000,000.00 issued by Atlantic Specialty Insurance Company; (ii)&nbsp;a
surety bond in the amount of $25,000,000.00 issued by Argonaut Insurance Co.; and (iii) a surety bond or surety bonds in the amount
of $140,557,767.00 issued by Westchester Fire Insurance Company. Borrower shall have provided, or caused the surety bond issuers
to provide, to Bank true and correct copies of each of the above described surety bonds.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(g)&#9;<U>Confirmation of Regulatory Authority</U>. Bank
shall have received written confirmation, in form and substance satisfactory to Bank in its sole discretion, that the transactions
contemplated in this Agreement (including AICE&rsquo;s pledge of additional collateral securing the Insurance Letters of Credit)
(i) satisfy the obligations of Borrower to OSIP, and (ii) have been approved by the Department of Insurance of the State of Arizona.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(h)&#9;<U>Capitalization of AICE</U>. Bank shall have received
confirmation, in form and substance satisfactory to Bank in its sole discretion, that (i) Borrower has provided to AICE additional
capital from Borrower&rsquo;s cash on hand in an amount not less than Thirty-Five Million Dollars ($35,000,000.00), which amount,
together with the proceeds of Term Loan 2, shall be sufficient to satisfy Borrower&rsquo;s obligations to the Department of Insurance
of the State of Arizona with respect to the required capital and surplus of AICE; and (ii) true and correct copies of all corporate
consents, approval and authorizations of Borrower evidencing the capital contributions to AICE required by the Department of Insurance
of the State of Arizona.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 3.2.&#9;CONDITIONS OF EACH EXTENSION OF CREDIT.
The obligation of Bank to make each extension of credit requested by Borrower hereunder shall be subject to the fulfillment to
Bank's satisfaction of each of the following conditions:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(a)&#9;<U>Compliance</U>. The representations and warranties
contained herein and in each of the other Loan Documents shall be true on and as of the date of the signing of this Agreement and
on the date of each extension of credit by Bank pursuant hereto, with the same effect as though such representations and warranties
had been made on and as of each such date, and on each such date, no Event of Default as defined herein, and no condition, event
or act which with the giving of notice or the passage of time or both would constitute such an Event of Default, shall have occurred
and be continuing or shall exist.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(b)&#9;<U>Documentation</U>. Bank shall have received all
additional documents which may be required in connection with such extension of credit.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>ARTICLE IV</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>AFFIRMATIVE COVENANTS</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">Borrower covenants that so long as Bank
remains committed to extend credit to Borrower pursuant hereto, or any liabilities (whether direct or contingent, liquidated or
unliquidated) of Borrower to Bank under any of the Loan Documents remain outstanding, and until payment in full of all obligations
of Borrower subject hereto, Borrower shall, unless Bank otherwise consents in writing:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 4.1.&#9;PUNCTUAL PAYMENTS. Punctually pay all principal,
interest, fees or other liabilities due under any of the Loan Documents at the times and place and in the manner specified therein,
and immediately upon demand by Bank, the amount by which the outstanding principal balance of any credit subject hereto at any
time exceeds any limitation on borrowings applicable thereto.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 4.2.&#9;ACCOUNTING RECORDS. Maintain adequate books
and records of Borrower and each of the Affiliates in accordance with generally accepted accounting principles consistently applied,
and permit any representative of Bank, at any reasonable time, to inspect, audit and examine such books and records, to make copies
of the same, and to inspect the properties of Borrower and each of the Affiliates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 4.3.&#9;FINANCIAL STATEMENTS. Provide to Bank all
of the following, in form and detail satisfactory to Bank:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(a)&#9;not later than 120 days after and as of the end of
each fiscal year, an audited consolidated financial statement of Borrower, prepared by a certified public accountant acceptable
to Bank, to include balance sheet, income statement, and statement of cash flows and sources, and shall be accompanied by the unqualified
opinion of such accountant addressed to Bank;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(b)&#9;not later than 180 days after and as of the end of
each fiscal year, an audited financial statement for each of AICE, and Ecole Insurance Company, an Arizona corporation wholly owned
by Borrower (&ldquo;Ecole&rdquo;) (AICE and Ecole, each an &ldquo;Affiliate&rdquo; and collectively, the &ldquo;Affiliates&rdquo;),
prepared by a certified public accountant acceptable to Bank, to include balance sheet, income statement and statement of cash
flows and sources, and shall be accompanied by the unqualified opinion of such accountant addressed to Bank;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(c)&#9;promptly upon their becoming available, copies of
(i) all financial statements, reports, notices and proxy statements made publicly available by Borrower to its security holders;
(ii) all regular and periodic reports and all registration statements and prospectuses, if any, filed by Borrower with any securities
exchange or with the U.S. Securities and Exchange Commission (&ldquo;SEC&rdquo;) or any governmental or private regulatory authority,
including, but not limited to (A) not later than 95 calendar days after the end of each fiscal year, Borrower&rsquo;s 10-K filing
with the SEC (including all exhibits and certifications) for the fiscal year just ended, and (B)&nbsp;not later than 50 calendar
days after the end of each fiscal quarter, Borrower&rsquo;s 10-Q filing with the SEC (including all exhibits and certifications)
for the fiscal quarter just ended; and (iii) all press releases and other statements made available by Borrower to the public concerning
material changes or developments in the business of Borrower;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(d)&#9;not later than 30 days after and as of the end of
each month, a borrowing base certificate, and immediately upon each request from Bank, any supporting information relating thereto
requested by Bank;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(e)&#9;contemporaneously with each annual and quarterly
financial statement of Borrower and the Affiliates required hereby, a certificate of the president or chief financial officer of
Borrower that said financial statements are accurate, that Borrower is in compliance with all financial covenants in this Agreement
(as evidenced by detailed calculations attached to such certificate), and that there exists no Event of Default nor any condition,
act or event which with the giving of notice or the passage of time or both would constitute an Event of Default;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(f)&#9;annually, but in all events not later than October
15 of each year (commencing October 15, 2015), true and correct copies of a Uniform Certificate of Authority Application-Certificate
of Compliance issued by the State of Arizona Director of Insurance for each of the Affiliates indicating that, as of a date no
earlier than thirty (30) days prior to the date each such certificate is delivered to Bank, each of the Affiliates is duly organized
under the laws of the State of Arizona and authorized to transact the relevant insurance business of each of the Affiliates in
the State of Arizona;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(g)&#9;annually, but in all events not later than April
30 of each year (commencing April&nbsp;30,&nbsp;2015), true and correct copies of all third party actuarial reviews of the workers&rsquo;
compensation obligations of Borrower and the Affiliates, including such actuarial reviews of Borrower and the Affiliates provided
to OSIP.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(h)&#9;promptly upon Borrower&rsquo;s receipt thereof each
month, a true and correct copy of the monthly actuarial consultant&rsquo;s report provided to Borrower; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(i)&#9;from time to time such other information as Bank
may reasonably request, including without limitation, copies of rent rolls and other information with respect to any real property
collateral required hereby.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 4.4.&#9;COMPLIANCE. Preserve and maintain all licenses,
permits, governmental approvals, rights, privileges and franchises necessary for the conduct of its business; and comply with the
provisions of all documents pursuant to which Borrower or any of the Affiliates is organized and/or which govern Borrower's or
any of the Affiliates&rsquo; continued existence and with the requirements of all laws, rules, regulations and orders of any governmental
authority applicable to Borrower and/or its business and to each of the Affiliates and/or its business.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 4.5.&#9;INSURANCE. Maintain and keep in force, for
each business in which Borrower and each of the Affiliates is engaged, insurance of the types and in amounts customarily carried
in similar lines of business, including but not limited to fire, extended coverage, public liability, flood, and, if required,
seismic property damage and workers&rsquo; compensation, with all such insurance carried with companies and in amounts satisfactory
to Bank, and deliver to Bank from time to time at Bank&rsquo;s request schedules setting forth all insurance then in effect, together
with a lender&rsquo;s loss payee endorsement for all such insurance naming Bank as a lender loss payee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 4.6.&#9;FACILITIES. Keep all properties useful or
necessary to Borrower's business in good repair and condition, and from time to time make necessary repairs, renewals and replacements
thereto so that such properties shall be fully and efficiently preserved and maintained.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 4.7.&#9;TAXES AND OTHER LIABILITIES. Pay and discharge
when due any and all indebtedness, obligations, assessments and taxes, both real or personal, including without limitation federal
and state income taxes and state and local property taxes and assessments, except (a) such as Borrower may in good faith contest
or as to which a bona fide dispute may arise, and (b) for which Borrower has made provision, to Bank&rsquo;s satisfaction, for
eventual payment thereof in the event Borrower is obligated to make such payment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 4.8.&#9;LITIGATION. Promptly give notice in writing
to Bank of any litigation pending or threatened against Borrower or any of the Affiliates with a claim in excess of $1,000,000.00.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 4.9.&#9;FINANCIAL CONDITION. Maintain Borrower&rsquo;s
consolidated financial condition as follows using generally accepted accounting principles consistently applied and used consistently
with prior practices (except to the extent modified by the definitions herein), with compliance determined commencing with Borrower&rsquo;s
consolidated financial statements for the period ending December 31, 2014:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(a)&#9;Fixed Charge Coverage Ratio not less than 1.50 to
1.0 as of each fiscal quarter end, determined on a rolling 4-quarter basis, with &ldquo;Fixed Charge Coverage Ratio&rdquo; defined
as (i)&nbsp;EBITDA minus distributions and dividends, plus cash tax refunds less cash taxes paid, divided by (ii)&nbsp;prior period
scheduled principal payments plus interest plus current portion of capital lease payments, with &ldquo;EBITDA&rdquo; defined as
net profit before taxes plus interest expense (net of capitalized interest expense), depreciation expense and amortization expense;
provided, however, that for purposes of calculating the Fixed Charge Coverage Ratio: (i)&nbsp;$66,500,000 will be added to the
numerator, and $5,000,000 will be added to the denominator, for each of the periods ending December 31, 2014, March 31, 2015 and
June 30, 2015, and (ii)&nbsp;$5,000,000 will be added to the denominator for the period ending September 30, 2015.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(b)&#9;Liquid Assets to Worker&rsquo;s Compensation Claims
&amp; Safety Incentive Liabilities not less than 1.0 to 1.0 as of each fiscal quarter end, with &ldquo;Liquid Assets&rdquo; defined
as the sum of (i)&nbsp;restricted and unrestricted cash and cash equivalents, plus (ii) restricted and unrestricted marketable
securities acceptable to Bank in its sole discretion, and with &ldquo;Worker&rsquo;s Compensation Claims &amp; Safety Incentive
Liabilities&rdquo; defined as the aggregate of Borrower&rsquo;s obligations with respect to (i) workers&rsquo; compensation claims
liabilities, and (ii) safety incentive liabilities, in each case as the assets described in clauses (i) and (ii) of the foregoing
definition of &ldquo;Liquid Assets&rdquo; and as the liabilities described in clauses (i) and (ii) of the foregoing definition
of &ldquo;Worker&rsquo;s Compensation Claims &amp; Safety Incentive Liabilities&rdquo; are required to be reflected in Borrower&rsquo;s
annual audited consolidated financial statements and quarterly unaudited consolidated financial statements, consistent with past
practices.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 4.10.&#9;NOTICE TO BANK. Promptly (but in no event
more than five (5) days after the occurrence of each such event or matter) give written notice to Bank in reasonable detail of:
(a)&nbsp;the occurrence of any Event of Default, or any condition, event or act which with the giving of notice or the passage
of time or both would constitute an Event of Default; (b)&nbsp;any change in the name or the organizational structure of Borrower;
(c)&nbsp;the occurrence and nature of any Reportable Event or Prohibited Transaction, each as defined in ERISA, or any funding
deficiency with respect to any Plan; or (d)&nbsp;any termination or cancellation of any insurance policy which Borrower is required
to maintain, or any uninsured or partially uninsured loss through liability or property damage, or through fire, theft or any other
cause affecting Borrower&rsquo;s property in excess of an aggregate of $1,000,000.00.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 4.11.&#9;MAINTENANCE OF AICE POLICIES. For so long
as any one or more of the Insurance Letters of Credit remains outstanding: (a) Borrower shall maintain in full force and effect,
and pay all premiums with respect to, all policies of insurance with AICE outstanding as of the date hereof with respect to the
satisfaction of Borrower&rsquo;s worker&rsquo;s compensation obligations under the laws of the State of California (the &ldquo;AICE
Policies&rdquo;); and (b)&nbsp; in the event any of the AICE Policies are terminated or cancelled for any reason, Borrower shall
promptly cause all premiums refunded therefrom to be deposited into a deposit account with Bank, in which Borrower shall (i) grant
to Bank a security interest of first priority and Bank shall have perfected its security interest therein, and (ii) maintain in
such deposit account funds in an amount sufficient to satisfy all obligations of Borrower to Bank with respect to the Insurance
Letters of Credit.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 4.12.&#9;FUNDING OF AICE DEPOSIT ACCOUNTS. For so
long as any one or more of the Insurance Letters of Credit remain outstanding, Borrower shall provide such financial support to
AICE as is necessary to ensure that the principal balance of time deposits in the AICE Deposit Accounts is no less than the then
outstanding aggregate dollar amount of the Insurance Letters of Credit (the &ldquo;Minimum Collateral Value&rdquo;). In the event
that the time deposit funds in the AICE Deposit Accounts is, for any reason and at any time, less than the Minimum Collateral Value,
Borrower shall promptly provide to AICE funds, and shall cause AICE to use such funds to increase the principal amount of the time
deposit(s) in the AICE Deposit Accounts, in an amount sufficient to achieve the Minimum Collateral Value.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 4.13.&#9;DEPOSIT ACCOUNTS. Maintain Borrower&rsquo;s
principal deposit account and other traditional banking relationships with Bank for the duration of this Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>ARTICLE V</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>NEGATIVE COVENANTS</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">Borrower further covenants that so long
as Bank remains committed to extend credit to Borrower pursuant hereto, or any liabilities (whether direct or contingent, liquidated
or unliquidated) of Borrower to Bank under any of the Loan Documents remain outstanding, and until payment in full of all obligations
of Borrower subject hereto, Borrower will not without Bank's prior written consent:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 5.1.&#9;USE OF FUNDS. Use any of the proceeds of
any credit extended hereunder except for the purposes stated in Article I hereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 5.2.&#9;CAPITAL EXPENDITURES. Make any additional
investment in fixed assets in (a) fiscal year 2015 in excess of an aggregate of $5,000,000.00, or (b) fiscal year 2016 in excess
of an aggregate of $4,000,000.00.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 5.3.&#9;OTHER INDEBTEDNESS. Create, incur, assume
or permit to exist any indebtedness or liabilities resulting from borrowings, loans or advances, whether secured or unsecured,
matured or unmatured, liquidated or unliquidated, joint or several, except (a) the liabilities of Borrower to Bank, and (b)&nbsp;purchase
money indebtedness (including capitalized leases) for the acquisition of assets, provided that (i) the total new purchase money
indebtedness does not exceed $200,000.00 in any fiscal year, and (ii) the aggregate of all purchase money indebtedness does not
exceed $400,000.00 at any time, and (c) any other liabilities of Borrower or any of the Affiliates existing as of, and disclosed
to the Bank prior to, the date hereof; provided, however, that if Borrower or any of the Affiliates incurs indebtedness or becomes
liable to any third party to the extent permitted hereunder, neither Borrower nor any of the Affiliates shall enter into any agreement
with such other party that prohibits Borrower or any of the Affiliates, as the case may be, from incurring indebtedness with Bank
or any affiliate of Bank or that prohibits Borrower or any of the Affiliates from granting Bank or any affiliate of Bank a lien
on any real or personal property owned by Borrower or any of the Affiliates, as the case may be.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 5.4.&#9;MERGER, CONSOLIDATION, TRANSFER OF ASSETS.
Merge into or consolidate with any other entity; make any substantial change in the nature of Borrower's or any of the Affiliates&rsquo;
business as conducted as of the date hereof; acquire all or substantially all of the assets of any other entity; or sell, lease,
transfer or otherwise dispose of all or a substantial or material portion of Borrower's or any of the Affiliates&rsquo; assets
except in the ordinary course of its business.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 5.5.&#9;GUARANTIES. Guarantee or become liable in
any way as surety, endorser (other than as endorser of negotiable instruments for deposit or collection in the ordinary course
of business), accommodation endorser or otherwise for, nor pledge or hypothecate any assets of Borrower as security for, any liabilities
or obligations of any other person or entity, except any of the foregoing in favor of Bank.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 5.6.&#9;LOANS, ADVANCES, INVESTMENTS. Make any loans
or advances to or investments in, or permit any of the Affiliates to make any loans or advances to or investments in, any person
or entity, except any of the foregoing existing as of, and disclosed to Bank prior to, the date hereof and except, in the case
of AICE, investments of insurance reserves in the ordinary course of business and consistent with past practices.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 5.7.&#9;DIVIDENDS, DISTRIBUTIONS. Declare or pay
any dividend or distribution either in cash, stock or any other property on Borrower&rsquo;s stock now or hereafter outstanding,
nor redeem, retire, repurchase or otherwise acquire any shares of any class of Borrower&rsquo;s stock now or hereafter outstanding.
Notwithstanding the foregoing, so long as, after giving effect to such dividend or distribution, no Event of Default would exist,
Borrower may pay quarterly cash dividends or distributions to its holders of its common stock in an amount not to exceed $0.22
per share in the aggregate in any fiscal quarter (the &ldquo;Permitted Dividend Amount&rdquo;); provided, however, that in the
event Borrower, after the date hereof, issues additional shares of its common stock, subdivides its common stock, by split-up or
otherwise, or combines its common stock, or issues additional common stock as a dividend, then the Permitted Dividend Amount shall
be subject to adjustment as determined by Bank, in its sole discretion, to give proportional effect to such event.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 5.8.&#9;PLEDGE OF ASSETS. Mortgage, pledge, grant
or permit to exist a security interest in, or lien upon, all or any portion of Borrower&rsquo;s assets now owned or hereafter acquired,
except (a) security interests or liens in favor of Bank; (b) security interests or liens existing as of, and disclosed to Bank
in writing prior to, the date hereof; and (c) liens to secure purchase money indebtedness permitted under Section 5.3 hereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 5.9.&#9;LINE OF CREDIT BORROWING LIMITATION. The
principal amount outstanding under the Line of Credit shall not, as of any fiscal month end, exceed the sum of eighty percent (80%)
of Borrower&rsquo;s eligible accounts receivable, with &ldquo;eligible accounts receivable&rdquo; defined as fifteen and seven
tenths of one percent (15.7%) of the aggregate dollar amount of Borrower&rsquo;s then outstanding accounts receivable; provided,
however, that in the event the principal amount outstanding under the Line of Credit exceeds the foregoing limitation, Borrower
shall be deemed in compliance with this Section 5.9 so long as Borrower pays to Bank, within three (3) days after Borrower becomes
aware of any such excess, the amount such excess.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 5.10.&#9;NO CANCELLATION OF AICE POLICIES. Terminate
or cancel any of the AICE Policies without Bank&rsquo;s prior written consent.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>ARTICLE VI</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>EVENTS OF DEFAULT</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 6.1.&#9;The occurrence of any of the following shall
constitute an &ldquo;Event of Default&rdquo; under this Agreement:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(a)&#9;Borrower shall fail to pay when due any principal,
interest, fees or other amounts payable under any of the Loan Documents.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(b)&#9;Any financial statement or certificate furnished
to Bank in connection with, or any representation or warranty made by Borrower or any other party under this Agreement or any other
Loan Document shall prove to be incorrect, false or misleading in any material respect when furnished or made.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(c)&#9;Any default in the performance of or compliance with
any obligation, agreement or other provision contained herein or in any other Loan Document (other than those specifically described
as an &ldquo;Event of Default&rdquo; in this section 6.1), and with respect to any such default that by its nature can be cured,
such default shall continue for a period of twenty (20) days from (i)&nbsp;its occurrence, or (ii) solely with respect to Borrower&rsquo;s
information reporting obligations under Section 4.3(d), Section 4.3 (g) or Section 4.3(h), Bank&rsquo;s giving of notice to Borrower
of the occurrence thereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(d)&#9;Any default in the payment or performance of any
obligation, or any defined event of default, under the terms of any contract, instrument or document (other than any of the Loan
Documents) pursuant to which Borrower, any of the Affiliates, any guarantor hereunder or any general partner or joint venturer
in Borrower if a partnership or joint venture (with each such guarantor, general partner and/or joint venturer referred to herein
as a &ldquo;Third Party Obligor&rdquo;) has incurred any debt or other liability to any person or entity, including Bank.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(e)&#9;Borrower, any of the Affiliates, or any Third Party
Obligor shall become insolvent, or shall suffer or consent to or apply for the appointment of a receiver, trustee, custodian or
liquidator of itself or any of its property, or shall generally fail to pay its debts as they become due, or shall make a general
assignment for the benefit of creditors; Borrower, any of the Affiliates or any Third Party Obligor shall file a voluntary petition
in bankruptcy, or seeking reorganization, in order to effect a plan or other arrangement with creditors or any other relief under
the Bankruptcy Reform Act, Title 11 of the United States Code, as amended or recodified from time to time (&ldquo;Bankruptcy Code&rdquo;),
or under any state or federal law granting relief to debtors, whether now or hereafter in effect; or Borrower, any of the Affiliates
or any Third Party Obligor shall file an answer admitting the jurisdiction of the court and the material allegations of any involuntary
petition; or Borrower, any of the Affiliates or any Third Party Obligor shall be adjudicated a bankrupt, or an order for relief
shall be entered against Borrower, any of the Affiliates or any Third Party Obligor by any court of competent jurisdiction under
the Bankruptcy Code or any other applicable state or federal law relating to bankruptcy, reorganization or other relief for debtors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(f)&#9;The filing of a notice of judgment lien against Borrower,
any of the Affiliates or any Third Party Obligor; or the recording of any abstract of judgment against Borrower, any of the Affiliates
or any Third Party Obligor in any county in which Borrower, any of the Affiliates or such Third Party Obligor has an interest in
real property; or the service of a notice of levy and/or of a writ of attachment or execution, or other like process, against the
assets of Borrower, any of the Affiliates or any Third Party Obligor; or the entry of a judgment against Borrower, any of the Affiliates
or any Third Party Obligor; or any involuntary petition or proceeding pursuant to the Bankruptcy Code or any other applicable state
or federal law relating to bankruptcy, reorganization or other relief for debtors is filed or commenced against Borrower, any of
the Affiliates or any Third Party Obligor.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(g)&#9;There shall exist or occur any event or condition
that Bank in good faith believes impairs, or is substantially likely to impair, the prospect of payment or performance by Borrower,
any of the Affiliates, any Third Party Obligor, or the general partner of either if such entity is a partnership, of its obligations
under any of the Loan Documents.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(h)&#9;The death or incapacity of Borrower or any Third
Party Obligor if an individual. The dissolution or liquidation of Borrower, any of the Affiliates or any Third Party Obligor if
a corporation, partnership, joint venture or other type of entity; or Borrower, any of the Affiliates or any such Third Party Obligor,
or any of its directors, stockholders or members, shall take action seeking to effect the dissolution or liquidation of Borrower,
any of the Affiliates or such Third Party Obligor.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(i)&#9;Any change in control of Borrower, any of the Affiliates
or any entity or combination of entities that directly or indirectly control Borrower or any of the Affiliates, with &ldquo;control&rdquo;
defined as ownership of an aggregate of twenty-five percent (25%) or more of the common stock, members' equity or other ownership
interest (other than a limited partnership interest).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(j)&#9;The sale, transfer, hypothecation, assignment or
encumbrance, whether voluntary, involuntary or by operation of law, without Bank&rsquo;s prior written consent, of all or any part
of or interest in any real property collateral required hereby.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(k)&#9;Any amount is drawn on any of the Insurance Letters
of Credit.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 6.2.&#9;REMEDIES. Upon the occurrence of any Event
of Default: (a)&nbsp;all indebtedness of Borrower under each of the Loan Documents, any term thereof to the contrary notwithstanding,
shall at Bank&rsquo;s option and without notice become immediately due and payable without presentment, demand, protest or notice
of dishonor, all of which are hereby expressly waived by Borrower; (b)&nbsp;the obligation, if any, of Bank to extend any further
credit under any of the Loan Documents shall immediately cease and terminate; and (c)&nbsp;Bank shall have all rights, powers and
remedies available under each of the Loan Documents, or accorded by law, including without limitation the right to resort to any
or all security for any credit subject hereto and to exercise any or all of the rights of a beneficiary or secured party pursuant
to applicable law. All rights, powers and remedies of Bank may be exercised at any time by Bank and from time to time after the
occurrence of an Event of Default, are cumulative and not exclusive, and shall be in addition to any other rights, powers or remedies
provided by law or equity.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>ARTICLE VII</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>MISCELLANEOUS</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 7.1.&#9;NO WAIVER. No delay, failure or discontinuance
of Bank in exercising any right, power or remedy under any of the Loan Documents shall affect or operate as a waiver of such right,
power or remedy; nor shall any single or partial exercise of any such right, power or remedy preclude, waive or otherwise affect
any other or further exercise thereof or the exercise of any other right, power or remedy. Any waiver, permit, consent or approval
of any kind by Bank of any breach of or default under any of the Loan Documents must be in writing and shall be effective only
to the extent set forth in such writing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 7.2.&#9;NOTICES. All notices, requests and demands
which any party is required or may desire to give to any other party under any provision of this Agreement must be in writing delivered
to each party at the following address:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<TR STYLE="vertical-align: top">
    <TD>BORROWER:&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD COLSPAN="2">BARRETT BUSINESS SERVICES, INC.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">8100 NE Parkway Drive, Suite 200</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">Vancouver, Washington 98662</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 10%">&nbsp;</TD>
    <TD STYLE="width: 5%">Attn.:</TD>
    <TD STYLE="width: 85%">James D. Miller, Vice President-Finance</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>BANK:</TD>
    <TD COLSPAN="2">WELLS FARGO BANK, NATIONAL ASSOCIATION</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">Portland RCBO</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">MAC P6101-250</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">1300 SW Fifth Avenue</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">Portland, Oregon 97201</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>Attn:</TD>
    <TD>Julie R. Wilson, Vice President</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">or to such other address as any party may designate by written
notice to all other parties. Each such notice, request and demand shall be deemed given or made as follows: (a)&nbsp;if sent by
hand delivery, upon delivery; (b)&nbsp;if sent by mail, upon the earlier of the date of receipt or three (3) days after deposit
in the U.S. mail, first class and postage prepaid; and (c)&nbsp;if sent by telecopy, upon receipt.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 7.3.&#9;COSTS, EXPENSES AND ATTORNEYS&rsquo; FEES.
Borrower shall pay to Bank immediately upon demand the full amount of all payments, advances, charges, costs and expenses, including
reasonable attorneys&rsquo; fees (to include outside counsel fees and all allocated costs of Bank's in-house counsel), expended
or incurred by Bank in connection with (a)&nbsp;the negotiation and preparation of this Agreement and the other Loan Documents,
Bank's continued administration hereof and thereof, and the preparation of any amendments and waivers hereto and thereto, (b)&nbsp;the
enforcement of Bank&rsquo;s rights and/or the collection of any amounts which become due to Bank under any of the Loan Documents,
and (c)&nbsp;the prosecution or defense of any action in any way related to any of the Loan Documents, including without limitation,
any action for declaratory relief, whether incurred at the trial or appellate level, in an arbitration proceeding or otherwise,
and including any of the foregoing incurred in connection with any bankruptcy proceeding (including without limitation, any adversary
proceeding, contested matter or motion brought by Bank or any other person) relating to Borrower or any other person or entity.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 7.4.&#9;SUCCESSORS, ASSIGNMENT. This Agreement shall
be binding upon and inure to the benefit of the heirs, executors, administrators, legal representatives, successors and assigns
of the parties; provided however, that Borrower may not assign or transfer its interests or rights hereunder without Bank&rsquo;s
prior written consent. Bank reserves the right to sell, assign, transfer, negotiate or grant participations in all or any part
of, or any interest in, Bank's rights and benefits under each of the Loan Documents. In connection therewith, Bank may disclose
all documents and information which Bank now has or may hereafter acquire relating to any credit subject hereto, Borrower or its
business, any guarantor hereunder or the business of such guarantor, if any, or any collateral required hereunder.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 7.5.&#9;ENTIRE AGREEMENT; AMENDMENT. This Agreement
and the other Loan Documents constitute the entire agreement between Borrower and Bank with respect to each credit subject hereto
and supersede all prior negotiations, communications, discussions and correspondence concerning the subject matter hereof. This
Agreement may be amended or modified only in writing signed by each party hereto.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 7.6.&#9;NO THIRD PARTY BENEFICIARIES. This Agreement
is made and entered into for the sole protection and benefit of the parties hereto and their respective permitted successors and
assigns, and no other person or entity shall be a third party beneficiary of, or have any direct or indirect cause of action or
claim in connection with, this Agreement or any other of the Loan Documents to which it is not a party.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 7.7.&#9;TIME. Time is of the essence of each and
every provision of this Agreement and each other of the Loan Documents.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 7.8.&#9;SEVERABILITY OF PROVISIONS. If any provision
of this Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent
of such prohibition or invalidity without invalidating the remainder of such provision or any remaining provisions of this Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 7.9.&#9;COUNTERPARTS. This Agreement may be executed
in any number of counterparts, each of which when executed and delivered shall be deemed to be an original, and all of which when
taken together shall constitute one and the same Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 7.10.&#9;GOVERNING LAW. This Agreement shall be
governed by and construed in accordance with the laws of the State of Oregon.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">SECTION 7.11.&#9;ARBITRATION.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(a)&#9;<U>Arbitration</U>. The parties hereto agree, upon
demand by any party, to submit to binding arbitration all claims, disputes and controversies between or among them (and their respective
employees, officers, directors, attorneys, and other agents), whether in tort, contract or otherwise in any way arising out of
or relating to (i) any credit subject hereto, or any of the Loan Documents, and their negotiation, execution, collateralization,
administration, repayment, modification, extension, substitution, formation, inducement, enforcement, default or termination; or
(ii) requests for additional credit. In the event of a court ordered arbitration, the party requesting arbitration shall be responsible
for timely filing the demand for arbitration and paying the appropriate filing fee within 30 days of the abatement order or the
time specified by the court. Failure to timely file the demand for arbitration as ordered by the court will result in that party&rsquo;s
right to demand arbitration being automatically terminated.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(b)&#9;<U>Governing Rules</U>. Any arbitration proceeding
will (i) proceed in a location in Oregon selected by the American Arbitration Association (&ldquo;AAA&rdquo;); (ii) be governed
by the Federal Arbitration Act (Title 9 of the United States Code), notwithstanding any conflicting choice of law provision in
any of the documents between the parties; and (iii) be conducted by the AAA, or such other administrator as the parties shall mutually
agree upon, in accordance with the AAA&rsquo;s commercial dispute resolution procedures, unless the claim or counterclaim is at
least $1,000,000.00 exclusive of claimed interest, arbitration fees and costs in which case the arbitration shall be conducted
in accordance with the AAA&rsquo;s optional procedures for large, complex commercial disputes (the commercial dispute resolution
procedures or the optional procedures for large, complex commercial disputes to be referred to herein, as applicable, as the &ldquo;Rules&rdquo;).
If there is any inconsistency between the terms hereof and the Rules, the terms and procedures set forth herein shall control.
Any party who fails or refuses to submit to arbitration following a demand by any other party shall bear all costs and expenses
incurred by such other party in compelling arbitration of any dispute. Nothing contained herein shall be deemed to be a waiver
by any party that is a bank of the protections afforded to it under 12 U.S.C. &sect;91 or any similar applicable state law.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(c)&#9;<U>No Waiver of Provisional Remedies,
Self-Help and Foreclosure</U>. The arbitration requirement does not limit the right of any party to (i) foreclose against real
or personal property collateral; (ii) exercise self-help remedies relating to collateral or proceeds of collateral such as setoff
or repossession; or (iii) obtain provisional or ancillary remedies such as replevin, injunctive relief, attachment or the appointment
of a receiver, before during or after the pendency of any arbitration proceeding. This exclusion does not constitute a waiver of
the right or obligation of any party to submit any dispute to arbitration or reference hereunder, including those arising from
the exercise of the actions detailed in sections (i), (ii) and (iii) of this paragraph.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(d)&#9;<U>Arbitrator Qualifications and Powers</U>. Any
arbitration proceeding in which the amount in controversy is $5,000,000.00 or less will be decided by a single arbitrator selected
according to the Rules, and who shall not render an award of greater than $5,000,000.00. Any dispute in which the amount in controversy
exceeds $5,000,000.00 shall be decided by majority vote of a panel of three arbitrators; provided however, that all three arbitrators
must actively participate in all hearings and deliberations. The arbitrator will be a neutral attorney licensed in the State of
Oregon or a neutral retired judge of the state or federal judiciary of Oregon, in either case with a minimum of ten years experience
in the substantive law applicable to the subject matter of the dispute to be arbitrated. The arbitrator will determine whether
or not an issue is arbitratable and will give effect to the statutes of limitation in determining any claim. In any arbitration
proceeding the arbitrator will decide (by documents only or with a hearing at the arbitrator's discretion) any pre-hearing motions
which are similar to motions to dismiss for failure to state a claim or motions for summary adjudication. The arbitrator shall
resolve all disputes in accordance with the substantive law of Oregon and may grant any remedy or relief that a court of such state
could order or grant within the scope hereof and such ancillary relief as is necessary to make effective any award. The arbitrator
shall also have the power to award recovery of all costs and fees, to impose sanctions and to take such other action as the arbitrator
deems necessary to the same extent a judge could pursuant to the Federal Rules of Civil Procedure, the Oregon Rules of Civil Procedure
or other applicable law. Judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction. The
institution and maintenance of an action for judicial relief or pursuit of a provisional or ancillary remedy shall not constitute
a waiver of the right of any party, including the plaintiff, to submit the controversy or claim to arbitration if any other party
contests such action for judicial relief.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(e)&#9;<U>Discovery</U>. In any arbitration proceeding,
discovery will be permitted in accordance with the Rules. All discovery shall be expressly limited to matters directly relevant
to the dispute being arbitrated and must be completed no later than 20 days before the hearing date. Any requests for an extension
of the discovery periods, or any discovery disputes, will be subject to final determination by the arbitrator upon a showing that
the request for discovery is essential for the party's presentation and that no alternative means for obtaining information is
available.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(f)&#9;<U>Class Proceedings and Consolidations</U>. No party
hereto shall be entitled to join or consolidate disputes by or against others in any arbitration, except parties who have executed
any Loan Document, or to include in any arbitration any dispute as a representative or member of a class, or to act in any arbitration
in the interest of the general public or in a private attorney general capacity.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(g)&#9;<U>Payment Of Arbitration Costs And Fees</U>. The
arbitrator shall award all costs and expenses of the arbitration proceeding.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(h)&#9;<U>Miscellaneous</U>. To the maximum extent practicable,
the AAA, the arbitrators and the parties shall take all action required to conclude any arbitration proceeding within 180 days
of the filing of the dispute with the AAA. No arbitrator or other party to an arbitration proceeding may disclose the existence,
content or results thereof, except for disclosures of information by a party required in the ordinary course of its business or
by applicable law or regulation. If more than one agreement for arbitration by or between the parties potentially applies to a
dispute, the arbitration provision most directly related to the Loan Documents or the subject matter of the dispute shall control.
This arbitration provision shall survive termination, amendment or expiration of any of the Loan Documents or any relationship<FONT STYLE="font-size: 10pt">
</FONT>between the parties.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">(i)&#9;<U>Small Claims Court</U>. Notwithstanding anything
herein to the contrary, each party retains the right to pursue in Small Claims Court any dispute within that court&rsquo;s jurisdiction.
Further, this arbitration provision shall apply only to disputes in which either party seeks to recover an amount of money (excluding
attorneys&rsquo; fees and costs) that exceeds the jurisdictional limit of the Small Claims Court.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><U>UNDER OREGON LAW, MOST AGREEMENTS, PROMISES AND COMMITMENTS
MADE BY BANK CONCERNING LOANS AND OTHER CREDIT EXTENSIONS WHICH ARE NOT FOR PERSONAL, FAMILY OR HOUSEHOLD PURPOSES OR SECURED SOLELY
BY THE BORROWER'S RESIDENCE MUST BE IN WRITING, EXPRESS CONSIDERATION AND BE SIGNED BY BANK TO BE ENFORCEABLE</U>.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.4in">IN WITNESS WHEREOF, the parties hereto have
caused this Agreement to be executed as of the day and year first written above.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD COLSPAN="2">BARRETT BUSINESS SERVICES, INC.</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">WELLS FARGO BANK, NATIONAL ASSOCIATION</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 3%">&nbsp;</TD>
    <TD STYLE="width: 40%">&nbsp;</TD>
    <TD STYLE="width: 7%">&nbsp;</TD>
    <TD STYLE="width: 3%">&nbsp;</TD>
    <TD STYLE="width: 40%">&nbsp;</TD>
    <TD STYLE="width: 7%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>By:</TD>
    <TD STYLE="border-bottom: Black 1pt solid">/s/ James D. Miller</TD>
    <TD>&nbsp;</TD>
    <TD>By:</TD>
    <TD STYLE="border-bottom: Black 1pt solid">/s/ Julie R. Wilson</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Name:&nbsp;&nbsp;</TD>
    <TD>James D. Miller</TD>
    <TD>&nbsp;</TD>
    <TD>Name:&nbsp;&nbsp;</TD>
    <TD>Julie R. Wilson</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Title:&nbsp;&nbsp;</TD>
    <TD>Vice President-Finance</TD>
    <TD>&nbsp;</TD>
    <TD>Title:&nbsp;&nbsp;</TD>
    <TD>Vice President</TD>
    <TD>&nbsp;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<TYPE>EX-10.3
<SEQUENCE>3
<FILENAME>v397968_ex10-3.htm
<DESCRIPTION>EXHIBIT 10.3
<TEXT>
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<HEAD>
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<BODY STYLE="font: 10pt Times New Roman, Times, Serif">

<P STYLE="margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>Exhibit 10.3</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">FIRST MODIFICATION TO TERM NOTE</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="text-transform: uppercase">This
FIRST modification to</FONT> TERM NOTE (this &ldquo;Modification&rdquo;) is entered into as of December&nbsp;29,&nbsp;2014, by
and between BARRETT BUSINESS SERVICES, INC., a Maryland corporation (&ldquo;Borrower&rdquo;), and <FONT STYLE="text-transform: uppercase">Wells
Fargo Bank, National Association</FONT> (&ldquo;Bank&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><U>RECITALS</U></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">WHEREAS, Borrower is currently indebted
to Bank pursuant to the terms and conditions of that certain Term Note in the maximum principal amount of $5,512,500.00 executed
by Borrower and payable to the order of Bank, dated as of November 1, 2012, as modified from time to time (the &quot;Note&quot;),
which Note is subject to the terms and conditions of a credit agreement between Borrower and Bank dated as of December 29, 2014,
as amended from time to time (the &quot;Credit Agreement&quot;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">WHEREAS, Bank and Borrower have agreed to
certain changes in the terms and conditions set forth in the Note, and have agreed to modify the Note to reflect said changes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">NOW, THEREFORE, for valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree that the Note shall be modified as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">1.&#9;The title of the Note is hereby amended to &ldquo;Term
Note 1,&rdquo; and the Note shall hereafter be referred to as Term Note 1.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">2.&#9;The preamble to the Note is hereby amended to delete
the address of Bank&rsquo;s office and to replace it with the following therefor:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.4in; text-indent: 0.4in">&ldquo;Portland RCBO, 1300 SW
Fifth Avenue, MAC P6101-250, Portland, Oregon 97201&rdquo;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">3.&#9;The Section of the Note entitled &ldquo;REPAYMENT
AND PREPAYMENT&rdquo; is hereby amended to delete the first sentence of Subsection (c) therein entitled &ldquo;<U>Prepayment</U>&rdquo;
and to replace it with the following therefor:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.5in 0pt 0.8in">&ldquo;From and after the date on which all of
Borrower&rsquo;s obligations under that certain Term Note 2 in the original principal amount of $40,000,000.00 dated December 29,
2014 executed by Borrower in favor of Bank have been satisfied in full and Bank obligations to extend credit to Borrower thereunder
have been terminated, Borrower may prepay principal on this Note at any time and in the minimum amount of One Hundred Thousand
Dollars ($100,000.00); provided however, that if the outstanding principal balance of this Note is less than said amount, the minimum
prepayment amount shall be the entire outstanding principal balance hereof.&rdquo;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">4.&#9;Except as expressly set forth herein, all terms and
conditions of the Note remain in full force and effect, without waiver or modification. All terms defined in the Note or the Credit
Agreement shall have the same meaning when used in this Modification. This Modification and the Note shall be read together, as
one document.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">5.&#9;Borrower certifies that as of the date of this Modification
there exists no Event of Default under the Note, nor any condition, act or event which with the giving of notice or the passage
of time or both would constitute any such Event of Default. Borrower further certifies that, notwithstanding the modifications
set forth herein, all of the real property securing the Note shall remain subject to the lien, charge or encumbrance of the deed
of trust, mortgage or other document pursuant to which such lien, charge or encumbrance is created, and nothing contained herein
or done pursuant hereto shall affect or be construed to affect the priority of the lien, charge or encumbrance of any such deed
of trust, mortgage or other document over any other liens, charges or encumbrances.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><U>UNDER OREGON LAW, MOST AGREEMENTS, PROMISES AND COMMITMENTS
MADE BY BANK CONCERNING LOANS AND OTHER CREDIT EXTENSIONS WHICH ARE NOT FOR PERSONAL, FAMILY OR HOUSEHOLD PURPOSES OR SECURED SOLELY
BY THE BORROWER'S RESIDENCE MUST BE IN WRITING, EXPRESS CONSIDERATION AND BE SIGNED BY BANK TO BE ENFORCEABLE.</U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">IN WITNESS WHEREOF, the parties hereto have
caused this Modification to be executed as of the day and year first written above.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD COLSPAN="2">BARRETT BUSINESS SERVICES, INC.</TD>
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">WELLS FARGO BANK, NATIONAL ASSOCIATION</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 3%">&nbsp;</TD>
    <TD STYLE="width: 40%">&nbsp;</TD>
    <TD STYLE="width: 7%">&nbsp;</TD>
    <TD STYLE="width: 3%">&nbsp;</TD>
    <TD STYLE="width: 40%">&nbsp;</TD>
    <TD STYLE="width: 7%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>By:</TD>
    <TD STYLE="border-bottom: Black 1pt solid">/s/ James D. Miller</TD>
    <TD>&nbsp;</TD>
    <TD>By:</TD>
    <TD STYLE="border-bottom: Black 1pt solid">/s/ Julie R. Wilson</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Name:&nbsp;&nbsp;</TD>
    <TD>James D. Miller</TD>
    <TD>&nbsp;</TD>
    <TD>Name:&nbsp;&nbsp;</TD>
    <TD>Julie R. Wilson</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Title:&nbsp;&nbsp;</TD>
    <TD>Vice President-Finance</TD>
    <TD>&nbsp;</TD>
    <TD>Title:&nbsp;&nbsp;</TD>
    <TD>Vice President</TD>
    <TD>&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>



<P STYLE="margin: 0"></P>

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<DOCUMENT>
<TYPE>EX-10.4
<SEQUENCE>4
<FILENAME>v397968_ex10-4.htm
<DESCRIPTION>EXHIBIT 10.4
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<P STYLE="margin: 0; text-align: right">&nbsp;</P>

<P STYLE="margin: 0; text-align: right"><B>Exhibit 10.4</B></P>

<P STYLE="margin: 0; text-align: right">&nbsp;</P>

<P STYLE="margin: 0; text-align: right"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">TERM NOTE 2</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%; font-size: 10pt">$14,000,000.00</TD>
    <TD STYLE="width: 50%; font-size: 10pt; text-align: right">Portland, Oregon</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">December 29, 2014</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">FOR VALUE RECEIVED, the undersigned BARRETT
BUSINESS SERVICES, INC. (&quot;Borrower&quot;) promises to pay to the order of WELLS FARGO BANK, NATIONAL ASSOCIATION (&quot;Bank&quot;)
at its office at Portland RCBO, 1300 SW Fifth Avenue, MAC P6101-250, Portland Oregon, 97201 or at such other place as the holder
hereof may designate, in lawful money of the United States of America and in immediately available funds, the principal sum of
Forty Million Dollars ($40,000,000.00), with interest thereon as set forth herein.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">DEFINITIONS:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As used herein, the following terms shall
have the meanings set forth after each, and any other term defined in this Note shall have the meaning set forth at the place defined:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(a)&#9;&quot;Daily One Month LIBOR&quot; means, for any
day, the rate of interest equal to LIBOR then in effect for delivery for a one (1) month period.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(b)&#9;&quot;LIBOR&quot; means the rate of interest per
annum determined by Bank based on the rate for United States dollar deposits for delivery of funds for one (1) month as reported
on Reuters Screen LIBOR01 page (or any successor page) at approximately 11:00 a.m., London time, or, for any day not a London Business
Day, the immediately preceding London Business Day (or if not so reported, then as determined by Bank from another recognized source
or interbank quotation).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(c)&#9;&quot;London Business Day&quot; means any day that
is a day for trading by and between banks in Dollar deposits in the London interbank market.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">INTEREST:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(a)&#9;<U>Interest</U>.<B> </B>The outstanding principal
balance of this Note shall bear interest (computed on the basis of a 360-day year, actual days elapsed) at a fluctuating rate per
annum determined by Bank to be four percent (4%) above Daily One Month LIBOR in effect from time to time. Bank is hereby authorized
to note the date and interest rate applicable to this Note and any payments made thereon on Bank's books and records (either manually
or by electronic entry) and/or on any schedule attached to this Note, which notations shall be prima facie evidence of the accuracy
of the information noted.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(b)&#9;<U>Taxes and Regulatory Costs</U>. Borrower shall
pay to Bank immediately upon demand, in addition to any other amounts due or to become due hereunder, any and all (i) withholdings,
interest equalization taxes, stamp taxes or other taxes (except income and franchise taxes) imposed by any domestic or foreign
governmental authority and related in any manner to LIBOR, and (ii) costs, expenses and liabilities arising from or in connection
with reserve percentages prescribed by the Board of Governors of the Federal Reserve System (or any successor) for &quot;Eurocurrency
Liabilities&quot; (as defined in Regulation D of the Federal Reserve Board, as amended), assessment rates imposed by the Federal
Deposit Insurance Corporation, or similar requirements or costs imposed by any domestic or foreign governmental authority or resulting
from compliance by Bank with any request or directive (whether or not having the force of law) from any central bank or other governmental
authority and related in any manner to LIBOR. In determining which of the foregoing are attributable to any LIBOR option available
to Borrower hereunder, any reasonable allocation made by Bank among its operations shall be conclusive and binding upon Borrower.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(c)&#9;<U>Payment of Interest</U>. Interest accrued on this
Note shall be payable on the last day of each month, commencing January 31, 2015.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(d)&#9;<U>Default Interest</U>. From and after the maturity
date of this Note, or such earlier date as all principal owing hereunder becomes due and payable by acceleration or otherwise,
or at Bank's option upon the occurrence, and during the continuance of an Event of Default, the outstanding principal balance of
this Note shall bear interest at an increased rate per annum (computed on the basis of a 360-day year, actual days elapsed) equal
to four percent (4%) above the rate of interest from time to time applicable to this Note.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">REPAYMENT AND PREPAYMENT:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(a)&#9;<U>Repayment</U>. Principal shall be payable as follows:
Three Million Dollars ($3,000,000.00) on June 30, 2015; Seven Million Dollars ($7,000,000.00) on September 30, 2015; Fifteen Million
Dollars ($15,000,000.00) on December 31, 2015; Five Million Dollars ($5,000,000.00) on June 30, 2016; Five Million Dollars ($5,000,000.00)
on September 30, 2016; and a final payment consisting of all remaining unpaid principal due and payable in full on December 31,
2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(b)&#9;<U>Mandatory Additional Principal
Payment</U>. Not later than thirty (30) days after filing of Borrower&rsquo;s 10-K with the U.S. Securities and Exchange Commission
for the fiscal year ended December 31, 2015, a principal payment in the dollar amount equal to sixty-five percent (65%) of Excess
Cash Flow in excess of $15,000,000 shall be payable, with &ldquo;Excess Cash Flow&rdquo; defined as EBITDA less cash taxes, less
cash interest, less $4,000,000 in capital expenditures, less loan payments due through December 31, 2015 and extra payments, and
less cash dividends, and with EBITDA defined as net profit before taxes plus interest expense (net of capitalized interest expense),
depreciation expense and amortization expense.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(c)&#9;<U>Application of Payments</U>. Each payment made
on this Note shall be credited first, to any interest then due and second, to the outstanding principal balance hereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(d)&#9;<U>Prepayment</U>. Borrower may prepay principal
on this Note at any time and in the minimum amount of One Hundred Thousand Dollars ($100,000.00); provided however, that if the
outstanding principal balance of such portion of this Note is less than said amount, the minimum prepayment amount shall be the
entire outstanding principal balance thereof. All prepayments of principal shall be applied on the most remote principal installment
or installments then unpaid.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">EVENTS OF DEFAULT:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">This Note is made pursuant to and is subject
to the terms and conditions of that certain Credit Agreement between Borrower and Bank dated as of December 29, 2014 as amended
from time to time (the &quot;Credit Agreement&quot;). Any default in the payment or performance of any obligation under this Note,
or any defined event of default under the Credit Agreement, shall constitute an &quot;Event of Default&quot; under this Note.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">MISCELLANEOUS:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(a)&#9;<U>Remedies</U>. Upon the sale, transfer, hypothecation,
assignment or other encumbrance, whether voluntary, involuntary or by operation of law, of all or any interest in any real property
securing this Note, or upon the occurrence of any Event of Default, the holder of this Note, at the holder's option, may declare
all sums of principal and interest outstanding hereunder to be immediately due and payable without presentment, demand, notice
of nonperformance, notice of protest, protest or notice of dishonor, all of which are expressly waived by Borrower. Borrower shall
pay to the holder immediately upon demand the full amount of all payments, advances, charges, costs and expenses, including reasonable
attorneys' fees (to include outside counsel fees and all allocated costs of the holder's in-house counsel), expended or incurred
by the holder in connection with the enforcement of the holder's rights and/or the collection of any amounts which become due to
the holder under this Note, and the prosecution or defense of any action in any way related to this Note, including without limitation,
any action for declaratory relief, whether incurred at the trial or appellate level, in an arbitration proceeding or otherwise,
and including any of the foregoing incurred in connection with any bankruptcy proceeding (including without limitation, any adversary
proceeding, contested matter or motion brought by Bank or any other person) relating to Borrower or any other person or entity.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(b)&#9;<U>Obligations Joint and Several</U>. Should more
than one person or entity sign this Note as a Borrower, the obligations of each such Borrower shall be joint and several.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(c)&#9;<U>Governing Law</U>. This Note shall be governed
by and construed in accordance with the laws of the State of Oregon.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><U>UNDER OREGON LAW, MOST AGREEMENTS, PROMISES AND COMMITMENTS
MADE BY BANK CONCERNING LOANS AND OTHER CREDIT EXTENSIONS WHICH ARE NOT FOR PERSONAL, FAMILY OR HOUSEHOLD PURPOSES OR SECURED SOLELY
BY THE BORROWER'S RESIDENCE MUST BE IN WRITING, EXPRESS CONSIDERATION AND BE SIGNED BY BANK TO BE ENFORCEABLE.</U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">IN WITNESS WHEREOF, the undersigned has
executed this Note effective as of the date first written above.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">BARRETT BUSINESS SERVICES, INC.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 2%">By: &nbsp;&nbsp;</TD>
    <TD STYLE="width: 48%; border-bottom: Black 1pt solid">/s/ James D. Miller</TD>
    <TD STYLE="width: 50%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Name:&nbsp;&nbsp; </TD>
    <TD>James D. Miller</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Title: &nbsp;&nbsp;</TD>
    <TD>Vice President-Finance</TD>
    <TD>&nbsp;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>



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<DOCUMENT>
<TYPE>EX-10.5
<SEQUENCE>5
<FILENAME>v397968_ex10-5.htm
<DESCRIPTION>EXHIBIT 10.5
<TEXT>
<HTML>
<HEAD>
     <TITLE></TITLE>
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<BODY STYLE="font: 10pt Times New Roman, Times, Serif">

<P STYLE="margin: 0; text-align: right">&nbsp;</P>

<P STYLE="margin: 0; text-align: right"><B>Exhibit 10.5</B></P>

<P STYLE="margin: 0; text-align: right">&nbsp;</P>

<P STYLE="margin: 0; text-align: right"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">REVOLVING LINE OF CREDIT NOTE</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%; font-size: 10pt">$14,000,000.00</TD>
    <TD STYLE="width: 50%; font-size: 10pt; text-align: right">Portland, Oregon</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>




<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">December 29, 2014</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">FOR VALUE RECEIVED, the undersigned BARRETT
BUSINESS SERVICES, INC. (&quot;Borrower&quot;) promises to pay to the order of WELLS FARGO BANK, NATIONAL ASSOCIATION (&quot;Bank&quot;)
at its office at Portland RCBO, 1300 SW Fifth Avenue, MAC P6101-250, Portland Oregon, 97201 or at such other place as the holder
hereof may designate, in lawful money of the United States of America and in immediately available funds, the principal sum of
Fourteen Million Dollars ($14,000,000.00), or so much thereof as may be advanced and be outstanding, with interest thereon, to
be computed on each advance from the date of its disbursement as set forth herein.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">DEFINITIONS:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">As used herein, the following terms shall
have the meanings set forth after each, and any other term defined in this Note shall have the meaning set forth at the place defined:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(a)&#9;&quot;Daily One Month LIBOR&quot;
means, for any day, the rate of interest equal to LIBOR then in effect for delivery for a one (1) month period.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(b)&#9;&quot;LIBOR&quot; means (i) for the purpose of calculating
effective rates of interest for loans making reference to LIBOR Periods, the rate of interest per annum determined by Bank based
on the rate for United States dollar deposits for delivery on the first day of each LIBOR Period for a period approximately equal
to such LIBOR Period as reported on Reuters Screen LIBOR01 page (or any successor page) at approximately 11:00 a.m., London time,
two London Business Days prior to the first day of such LIBOR Period (or if not so reported, then as determined by Bank from another
recognized source or interbank quotation), or (ii) for the purpose of calculating effective rates of interest for loans making
reference to the Daily One Month LIBOR Rate, the rate of interest per annum determined by Bank based on the rate for United States
dollar deposits for delivery of funds for one (1) month as reported on Reuters Screen LIBOR01 page (or any successor page) at approximately
11:00 a.m., London time, or, for any day not a London Business Day, the immediately preceding London Business Day (or if not so
reported, then as determined by Bank from another recognized source or interbank quotation).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(c)&#9;&quot;LIBOR Period&quot; means a period commencing
on a New York Business Day and continuing for one (1) month or three (3) months, as designated by Borrower, during which all or
a portion of the outstanding principal balance of this Note bears interest determined in relation to LIBOR; provided however, that
(i) no LIBOR Period may be selected for a principal amount less than Five Hundred Thousand Dollars ($500,000.00), (ii) if the day
after the end of any LIBOR Period is not a New York Business Day (so that a new LIBOR Period could not be selected by Borrower
to start on such day), then such LIBOR Period shall continue up to, but shall not include, the next New York Business Day after
the end of such LIBOR Period, unless the result of such extension would be to cause any immediately following LIBOR Period to begin
in the next calendar month in which event the LIBOR Period shall continue up to, but shall not include, the New York Business Day
immediately preceding the last day of such LIBOR Period, and (iii) no LIBOR Period shall extend beyond the scheduled maturity date
hereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(d)&#9;&quot;London Business Day&quot; means any day that
is a day for trading by and between banks in Dollar deposits in the London interbank market.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(e)&#9;&quot;New York Business Day&quot; means any day except
a Saturday, Sunday or any other day on which commercial banks in New York are authorized or required by law to close.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(f)&#9;&quot;State Business Day&quot; means any day except
a Saturday, Sunday or any other day on which commercial banks in the jurisdiction described in &ldquo;Governing Law&rdquo; herein
are authorized or required by law to close.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">INTEREST:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(a)&#9;<U>Interest</U>. The outstanding principal balance
of this Note shall bear interest (computed on the basis of a 360-day year, actual days elapsed) either (i) at a fluctuating rate
per annum determined by Bank to be two percent (2%) above the Daily One Month LIBOR Rate in effect from time to time, or (ii) at
a fixed rate per annum determined by Bank to be two percent (2%) above LIBOR in effect on the first day of the applicable LIBOR
Period. Bank is hereby authorized to note the date, principal amount and interest rate applicable thereto and any payments made
thereon on Bank's books and records (either manually or by electronic entry) and/or on any schedule attached to this Note, which
notations shall be prima facie evidence of the accuracy of the information noted.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(b)&#9;<U>Selection of Interest Rate Options</U>. Subject
to the provisions herein regarding LIBOR Periods and the prior notice required for the selection of a LIBOR interest rate, (i)
at any time any portion of this Note bears interest determined in relation to LIBOR for a LIBOR Period, it may be continued by
Borrower at the end of the LIBOR Period applicable thereto so that all or a portion thereof bears interest determined in relation
to the Daily One Month LIBOR Rate or to LIBOR for a new LIBOR Period designated by Borrower, (ii) at any time any portion of this
Note bears interest determined in relation to the Daily One Month LIBOR Rate, Borrower may convert all or a portion thereof so
that it bears interest determined in relation to LIBOR for a LIBOR Period designated by Borrower, and (iii) at the time an advance
is made hereunder, Borrower may choose to have all or a portion thereof bear interest determined in relation to the Daily One Month
LIBOR Rate or to LIBOR for a LIBOR Period designated by Borrower.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">To select an interest rate option hereunder
determined in relation to LIBOR for a LIBOR Period, Borrower shall give Bank notice thereof that is received by Bank prior to 11:00
a.m Oregon time on a State Business Day at least two State Business Days prior to the first day of the LIBOR Period, or at a later
time during such State Business Day if Bank, at its sole discretion, accepts Borrower&rsquo;s notice and quotes a fixed rate to
Borrower. Such notice shall specify: (A) the interest rate option selected by Borrower, (B)&nbsp;the principal amount subject thereto,
and (C) for each LIBOR selection, the length of the applicable LIBOR Period. If Bank has not received such notice in accordance
with the foregoing before an advance is made hereunder or before the end of any LIBOR Period, Borrower shall be deemed to have
made a Daily One Month LIBOR Rate interest selection for such advance or the principal amount to which such LIBOR Period applied.
Any such notice may be given by telephone (or such other electronic method as Bank may permit) so long as it is given in accordance
with the foregoing and, with respect to each LIBOR selection, if requested by Bank, Borrower provides to Bank written confirmation
thereof not later than three State Business Days after such notice is given. Borrower shall reimburse Bank immediately upon demand
for any loss or expense (including any loss or expense incurred by reason of the liquidation or redeployment of funds obtained
to fund or maintain a LIBOR borrowing) incurred by Bank as a result of the failure of Borrower to accept or complete a LIBOR borrowing
hereunder after making a request therefor. Any reasonable determination of such amounts by Bank shall be conclusive and binding
upon Borrower.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(c)&#9;<U>Taxes and Regulatory Costs</U>. Borrower shall
pay to Bank immediately upon demand, in addition to any other amounts due or to become due hereunder, any and all (i) withholdings,
interest equalization taxes, stamp taxes or other taxes (except income and franchise taxes) imposed by any domestic or foreign
governmental authority and related in any manner to LIBOR, and (ii) costs, expenses and liabilities arising from or in connection
with reserve percentages prescribed by the Board of Governors of the Federal Reserve System (or any successor) for &quot;Eurocurrency
Liabilities&quot; (as defined in Regulation D of the Federal Reserve Board, as amended), assessment rates imposed by the Federal
Deposit Insurance Corporation, or similar requirements or costs imposed by any domestic or foreign governmental authority or resulting
from compliance by Bank with any request or directive (whether or not having the force of law) from any central bank or other governmental
authority and related in any manner to LIBOR. In determining which of the foregoing are attributable to any LIBOR option available
to Borrower hereunder, any reasonable allocation made by Bank among its operations shall be conclusive and binding upon Borrower.<FONT STYLE="text-underline-style: double"><U>
</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(d)&#9;<U>Payment of Interest</U>. Interest accrued on this
Note shall be payable on the first day of each month, commencing February 1, 2015.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(e)&#9;<U>Default Interest</U>. From and after the maturity
date of this Note, or such earlier date as all principal owing hereunder becomes due and payable by acceleration or otherwise,
or at Bank's option upon the occurrence, and during the continuance of an Event of Default, the outstanding principal balance of
this Note shall bear interest at an increased rate per annum (computed on the basis of a 360-day year, actual days elapsed) equal
to four percent (4%) above the rate of interest from time to time applicable to this Note.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">BORROWING AND REPAYMENT:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(a)&#9;<U>Borrowing and Repayment</U>. Borrower may from
time to time during the term of this Note borrow, partially or wholly repay its outstanding borrowings, and reborrow, subject to
all of the limitations, terms and conditions of this Note and of any document executed in connection with or governing this Note;
provided however, that the total outstanding borrowings under this Note shall not at any time exceed the principal amount stated
above. The unpaid principal balance of this obligation at any time shall be the total amounts advanced hereunder by the holder
hereof less the amount of principal payments made hereon by or for Borrower, which balance may be endorsed hereon from time to
time by the holder. The outstanding principal balance of this Note shall be due and payable in full on October 1, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(b)&#9;<U>Advances</U>. Advances hereunder, to the total
amount of the principal sum stated above, may be made by the holder at the oral or written request of (i) Michael L. Elich or James
D. Miller, any one acting alone, who are authorized to request advances and direct the disposition of any advances until written
notice of the revocation of such authority is received by the holder at the office designated above, or (ii) any person, with respect
to advances deposited to the credit of any deposit account of Borrower, which advances, when so deposited, shall be conclusively
presumed to have been made to or for the benefit of Borrower regardless of the fact that persons other than those authorized to
request advances may have authority to draw against such account. The holder shall have no obligation to determine whether any
person requesting an advance is or has been authorized by Borrower.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(c)&#9;<U>Application of Payments</U>. Each payment made
on this Note shall be credited first, to any interest then due and second, to the outstanding principal balance hereof. All payments
credited to principal shall be applied first, to the outstanding principal balance of this Note which bears interest determined
in relation to the Daily One Month LIBOR Rate, if any, and second, to the outstanding principal balance of this Note which bears
interest determined in relation to LIBOR, with such payments applied to the oldest LIBOR Period first.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">PREPAYMENT:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(a)&#9;<U>Daily One Month LIBOR Rate</U>. Borrower may prepay
principal on any portion of this Note which bears interest determined in relation to the Daily One Month LIBOR Rate at any time,
in any amount and without penalty.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(b)&#9;<U>LIBOR</U>. Borrower may prepay principal on any
portion of this Note which bears interest determined in relation to LIBOR at any time and in the minimum amount of One Hundred
Thousand Dollars ($100,000.00); provided however, that if the outstanding principal balance of such portion of this Note is less
than said amount, the minimum prepayment amount shall be the entire outstanding principal balance thereof. In consideration of
Bank providing this prepayment option to Borrower, or if any such portion of this Note shall become due and payable at any time
prior to the last day of the LIBOR Period applicable thereto by acceleration or otherwise, Borrower shall pay to Bank immediately
upon demand a fee which is the sum of the discounted monthly differences for each month from the month of prepayment through the
month in which such LIBOR Period matures, calculated as follows for each such month:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 1in"></TD><TD STYLE="width: 0.25in; text-align: left">(i)</TD><TD STYLE="text-align: justify"><U>Determine</U> the amount of interest which would have
accrued each month on the amount prepaid at the interest rate applicable to such amount had it remained outstanding until the
last day of the LIBOR Period applicable thereto.</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 1in"></TD><TD STYLE="width: 0.25in; text-align: left">(ii)</TD><TD STYLE="text-align: justify"><U>Subtract</U> from the amount determined in (i) above
the amount of interest which would have accrued for the same month on the amount prepaid for the remaining term of such LIBOR
Period at LIBOR in effect on the date of prepayment for new loans made for such term and in a principal amount equal to the amount
prepaid.</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 1in"></TD><TD STYLE="width: 0.25in; text-align: left">(iii)</TD><TD STYLE="text-align: justify">If the result obtained in (ii) for any month is greater
than zero, discount that difference by LIBOR used in (ii) above.</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Borrower acknowledges that prepayment of such amount may result
in Bank incurring additional costs, expenses and/or liabilities, and that it is difficult to ascertain the full extent of such
costs, expenses and/or liabilities. Borrower, therefore, agrees to pay the above-described prepayment fee and agrees that said
amount represents a reasonable estimate of the prepayment costs, expenses and/or liabilities of Bank. If Borrower fails to pay
any prepayment fee when due, the amount of such prepayment fee shall thereafter bear interest until paid at a rate per annum four
percent (4%) above the Daily One Month LIBOR Rate in effect from time to time (computed on the basis of a 360-day year, actual
days elapsed).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">EVENTS OF DEFAULT:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">This Note is made pursuant to and is subject
to the terms and conditions of that certain Credit Agreement between Borrower and Bank dated as of December 29, 2014 as amended
from time to time (the &quot;Credit Agreement&quot;). Any default in the payment or performance of any obligation under this Note,
or any defined event of default under the Credit Agreement, shall constitute an &quot;Event of Default&quot; under this Note.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">MISCELLANEOUS:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(a)&#9;<U>Remedies</U>. Upon the sale, transfer, hypothecation,
assignment or other encumbrance, whether voluntary, involuntary or by operation of law, of all or any interest in any real property
securing this Note, or upon the occurrence of any Event of Default, the holder of this Note, at the holder's option, may declare
all sums of principal and interest outstanding hereunder to be immediately due and payable without presentment, demand, notice
of nonperformance, notice of protest, protest or notice of dishonor, all of which are expressly waived by Borrower, and the obligation,
if any, of the holder to extend any further credit hereunder shall immediately cease and terminate. Borrower shall pay to the holder
immediately upon demand the full amount of all payments, advances, charges, costs and expenses, including reasonable attorneys'
fees (to include outside counsel fees and all allocated costs of the holder's in-house counsel), expended or incurred by the holder
in connection with the enforcement of the holder's rights and/or the collection of any amounts which become due to the holder under
this Note, and the prosecution or defense of any action in any way related to this Note, including without limitation, any action
for declaratory relief, whether incurred at the trial or appellate level, in an arbitration proceeding or otherwise, and including
any of the foregoing incurred in connection with any bankruptcy proceeding (including without limitation, any adversary proceeding,
contested matter or motion brought by Bank or any other person) relating to Borrower or any other person or entity.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(b)&#9;<U>Obligations Joint and Several</U>. Should more
than one person or entity sign this Note as a Borrower, the obligations of each such Borrower shall be joint and several.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">(c)&#9;<U>Governing Law</U>. This Note shall be governed
by and construed in accordance with the laws of the State of Oregon.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">This Note replaces and supersedes in its
entirety that certain Revolving Reducing Note dated effective September 18, 2012 in the principal amount of $24,000,000.00 executed
by Borrower in favor of Bank.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">[Signature Page Follows]</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><U>UNDER OREGON LAW, MOST AGREEMENTS, PROMISES AND COMMITMENTS
MADE BY BANK CONCERNING LOANS AND OTHER CREDIT EXTENSIONS WHICH ARE NOT FOR PERSONAL, FAMILY OR HOUSEHOLD PURPOSES OR SECURED SOLELY
BY THE BORROWER'S RESIDENCE MUST BE IN WRITING, EXPRESS CONSIDERATION AND BE SIGNED BY BANK TO BE ENFORCEABLE.</U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">IN WITNESS WHEREOF, the undersigned has
executed this Note effective as of the date first written above.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">BARRETT BUSINESS SERVICES, INC.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 2%">By: &nbsp;&nbsp;</TD>
    <TD STYLE="width: 48%; border-bottom: Black 1pt solid">/s/ James D. Miller</TD>
    <TD STYLE="width: 50%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Name:&nbsp;&nbsp; </TD>
    <TD>James D. Miller</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Title: &nbsp;&nbsp;</TD>
    <TD>Vice President-Finance</TD>
    <TD>&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>



<P STYLE="margin: 0; text-align: right">&nbsp;</P>

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