<SUBMISSION>
<ACCESSION-NUMBER>0001193125-15-417170
<TYPE>8-K
<PUBLIC-DOCUMENT-COUNT>4
<PERIOD>20151222
<ITEMS>1.01
<ITEMS>2.01
<ITEMS>9.01
<FILING-DATE>20151230
<DATE-OF-FILING-DATE-CHANGE>20151230
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>DEER VALLEY CORP
<CIK>0000095047
<ASSIGNED-SIC>2451
<IRS-NUMBER>205256635
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>8-K
<ACT>34
<FILE-NUMBER>000-05388
<FILM-NUMBER>151312836
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>205 CARRIAGE ST
<CITY>GUIN
<STATE>AL
<ZIP>35562
<PHONE>205-468-8400 EXT 107
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>205 CARRIAGE ST
<CITY>GUIN
<STATE>AL
<ZIP>35562
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>CYTATION CORP
<DATE-CHANGED>20010626
</FORMER-COMPANY>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>COLLEGELINK COM INCORP
<DATE-CHANGED>19991122
</FORMER-COMPANY>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>CYTATION COM INC
<DATE-CHANGED>19990318
</FORMER-COMPANY>
</FILER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>d110043d8k.htm
<DESCRIPTION>FORM 8-K
<TEXT>
<HTML><HEAD>
<TITLE>Form 8-K</TITLE>
</HEAD>
 <BODY BGCOLOR="WHITE">

 <P STYLE="line-height:1.0pt;margin-top:0pt;margin-bottom:0pt;border-bottom:1px solid #000000">&nbsp;</P>
<P STYLE="line-height:3.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000">&nbsp;</P> <P STYLE="margin-top:4pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>UNITED STATES </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>SECURITIES AND EXCHANGE COMMISSION </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>Washington, D.C. 20549 </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>FORM 8-K
</B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center> <P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>Current Report </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>Pursuant
to Section&nbsp;13 or 15(d) </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>of the Securities Exchange Act of 1934 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>Date of Report (Date of earliest event reported): December&nbsp;22, 2015 </B></P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center> <P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:24pt; font-family:Times New Roman" ALIGN="center"><B>DEER VALLEY CORPORATION </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>(Exact Name of Registrant as Specified in its Charter) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top" ALIGN="center"><B>Florida</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"><B>000-05388</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"><B>20-5256635</B></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:8pt">
<TD VALIGN="top" ALIGN="center"><B>(State of Incorporation)</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(Commission</B></P>
<P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>File Number)</B></P></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(IRS Employer</B></P>
<P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>Identification Number)</B></P></TD></TR>
</TABLE> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top" ALIGN="center"><B>205 Carriage Street, Guin, AL</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"><B>35570</B></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:8pt">
<TD VALIGN="top" ALIGN="center"><B>(Address of principal executive offices)</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"><B>(Zip code)</B></TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>(205) 468-8400 </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(Registrant&#146;s Telephone Number, Including Area Code) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(Former name or former address, if changed since last report) </B></P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center> <P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Check the appropriate box below of the Form 8-K if the filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General instruction A.2. below): </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="FONT-FAMILY:WINGDINGS">&#168;</FONT></TD>
<TD ALIGN="left" VALIGN="top">Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="FONT-FAMILY:WINGDINGS">&#168;</FONT></TD>
<TD ALIGN="left" VALIGN="top">Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="FONT-FAMILY:WINGDINGS">&#168;</FONT></TD>
<TD ALIGN="left" VALIGN="top">Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2)(b) </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="FONT-FAMILY:WINGDINGS">&#168;</FONT></TD>
<TD ALIGN="left" VALIGN="top">Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)). </TD></TR></TABLE> <P STYLE="font-size:10pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<P STYLE="line-height:1.0pt;margin-top:0pt;margin-bottom:0pt;border-bottom:1px solid #000000">&nbsp;</P> <P STYLE="line-height:3.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000">&nbsp;</P>

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<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Unless otherwise indicated or the context otherwise requires, all references below in this
Current Report on Form 8-K to &#147;we,&#148; &#147;us,&#148; &#147;Deer Valley&#148; and the &#147;Company&#148; are to Deer Valley Corporation, a Florida corporation, together with its wholly-owned subsidiaries, Deer Valley Homebuilders, Inc., an
Alabama corporation, and Deer Valley Finance, Corp., a Florida corporation. Specific discussions or comments relating to Deer Valley Corporation will reference &#147;DVC,&#148; those relating to Deer Valley Homebuilders, Inc. will be referred to as
&#147;DVHB&#148;, and those relating to Deer Valley Finance Corp. will be referred to as &#147;DVFC.&#148; </P> <P STYLE="font-size:18pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="10%" VALIGN="top" ALIGN="left"><B>Item&nbsp;1.01</B></TD>
<TD ALIGN="left" VALIGN="top"><B>Entry into a Material Definitive Agreement </B></TD></TR></TABLE> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">On December&nbsp;22, 2015, Deer Valley
entered into that certain Secured Convertible Note and Security Agreement with BLU Autoworks LLC, a Delaware limited liability company (the &#147;Borrower&#148;), pursuant to which Deer Valley loaned Three Million and No/100 Dollars ($3,000,000) to
Borrower (the &#147;Initial Advance&#148;). The Secured Convertible Note provides that Borrower may, as agreed to by Deer Valley, borrower up to an additional One Million and No/100 Dollars ($1,000,000) (collectively, with the Initial Advance, the
&#147;Loan&#146;). The Loan bears interest at a rate of five percent (5.0%)&nbsp;per annum, matures on June&nbsp;30, 2016, and is secured by the assets of the Borrower. Deer Valley may, at its option, convert the outstanding principal and interest
of the Loan into membership interests in Borrower, which membership interests shall entitle Deer Valley to receive, upon liquidation of Borrower, shares of Tua Autoworks Holdings S.&agrave;.r.l. (&#147;Tua Luxembourg&#148;) equal to 5.74% of the
outstanding capital shares of Tua Luxembourg, or, if Deer Valle elects to request an independent valuation analysis, such percentage of the shares of Tua Luxembourg as determined by an independent valuation analysis. Tua Luxembourg and Borrower are
developing an automobile manufacturing business located in Italy. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Tony Bonidy and Lodovico de Visconti are members of the Board of
Directors of Deer Valley, Lodovico de Visconti is the sole manager of the Borrower, and Tony Bonidy, Lodovico de Visconti and Christophe Fender (a resident of Luxembourg) are the sole members of the Board of Directors of Tua Luxembourg. Tony Bonidy
and Lodovico de Visconti directly, or indirectly, control the voting capital stock of Deer Valley, Borrower, and Tua Luxembourg. </P> <P STYLE="font-size:18pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="10%" VALIGN="top" ALIGN="left"><B>Item&nbsp;2.01.</B></TD>
<TD ALIGN="left" VALIGN="top"><B>Completion of Acquisition or Disposition of Assets </B></TD></TR></TABLE> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">On December&nbsp;22, 2015, Deer
Valley sold, in a Bargain Sale Exchange, its idle manufacturing plant located in Sulligent, Alabama, and the surrounding thirteen (13)&nbsp;acres (the &#147;Sulligent Property&#148;). Deer Valley sold the Sulligent Property to The Industrial
Development Board of the Town of Sulligent Inc., a political subdivision of the State of Alabama and an IRS 561 approved organization (the &#147;Buyer&#148;), for a combined purchase price of One Million One Hundred Fifty Thousand and No/100 Dollars
($1,150,000), comprised of (i)&nbsp;a cash payment by Buyer to Deer Valley of Three Hundred Fifty Thousand and No/100 Dollars ($350,000), and (ii)&nbsp;a charitable contribution made by Deer Valley to Buyer of Eight Hundred Thousand and No/100
Dollars ($800,000). The charitable contribution equaled the difference between the appraised value of the Sulligent Property, as determined by an independent MAI appraiser, and the cash portion of the purchase price paid to Deer Valley by Buyer. The
Internal Revenue Code (IRC) 170 Exchange, also known as Bargain Sale, is a transaction which allows a property owner donate its property and receive a &#147;charitable contribution&#148; income tax deduction. </P>

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<TD WIDTH="10%" VALIGN="top" ALIGN="left"><B>Item&nbsp;9.01.</B></TD>
<TD ALIGN="left" VALIGN="top"><B>Financial Statements and Exhibits </B></TD></TR></TABLE> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The following exhibits are filed with this Form 8-K:
</P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" NOWRAP>10.01</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Secured Convertible Note</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" NOWRAP>10.02</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Security Agreement</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" NOWRAP>10.03</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Bargain Sale Agreement and Initial Escrow Instructions</TD></TR>
</TABLE>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>SIGNATURE </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">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 hereunto duly authorized. </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><DIV ALIGN="right">
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<TD VALIGN="top" COLSPAN="3">DEER VALLEY CORPORATION</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman"><I>/s/ John S. Lawler</I></P></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Name:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">John Steven Lawler</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Title:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Chief Financial Officer and Secretary</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Dated:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">December 30, 2015</TD></TR>
</TABLE></DIV>
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<DOCUMENT>
<TYPE>EX-10.01
<SEQUENCE>2
<FILENAME>d110043dex1001.htm
<DESCRIPTION>SECURED CONVERTIBLE NOTE
<TEXT>
<HTML><HEAD>
<TITLE>Secured Convertible Note</TITLE>
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 <BODY BGCOLOR="WHITE">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right"><B>Exhibit 10.01 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>SECURED CONVERTIBLE NOTE </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">THIS NOTE HAS
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE &#147;<U>ACT</U>&#148;) NOR UNDER ANY STATE SECURITIES LAW AND MAY NOT BE PLEDGED, SOLD, ASSIGNED, HYPOTHECATED OR OTHERWISE TRANSFERRED UNTIL (1)&nbsp;A REGISTRATION STATEMENT
WITH RESPECT THERETO IS EFFECTIVE UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAW OR (2)&nbsp;THE COMPANY RECEIVES AN OPINION OF COUNSEL TO THE COMPANY OR OTHER COUNSEL TO THE HOLDER OF SUCH NOTE (WHICH OTHER COUNSEL IS SATISFACTORY TO THE
COMPANY) THAT SUCH NOTE MAY BE PLEDGED, SOLD, ASSIGNED, HYPOTHECATED OR TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR APPLICABLE STATE SECURITIES LAWS AND (3)&nbsp;THE COMPANY APPROVES OF SUCH PROPOSED PLEDGE, SALE,
ASSIGNMENT, HYPOTHECATION OR TRANSFER. INVESTORS SHOULD BE AWARE THAT THEY WILL BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top">U.S. $4,000,000.00</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Date:&nbsp;December&nbsp;22,&nbsp;2015</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Pittsburgh, Pennsylvania</TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">In consideration of the execution of this Secured Convertible Note (&#147;<U>Note</U>&#148;) hereunder, BLU Autoworks LLC, a
Delaware limited liability company (the &#147;<U>Company</U>&#148;), hereby promises to pay to the order of Deer Valley Corporation, a Florida corporation (the &#147;<U>Holder</U>&#148;), the principal amount of up to Four Million and 00/100 Dollars
($4,000,000.00) (borrowed by the Company by the Holder in one or more tranches as agreed between the Company and the Holder) together with interest thereon calculated from the date of issuance set forth above. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">1. <U>Interest</U>. Interest on the unpaid, unconverted borrowed principal amount under this Note plus unpaid interest accrued thereon (compounded annually)
shall accrue at the rate of five percent (5.0%)&nbsp;per annum (computed on the basis of a 360-day year and the actual number of days elapsed in any year) (the &#147;<U>Initial Interest Rate</U>&#148;), commencing on the date of such borrowing;
provided, in the event that an Event of Default (as defined in <U>Section&nbsp;3</U> hereof) has occurred, interest shall accrue at the Initial Interest Rate plus three percent (3%)&nbsp;per annum for each period for which such Event of Default
continues (&#147;<U>Default Interest Rate</U>&#148;) until such Event of Default has been cured. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">2. <U>Payment of Principal and Interest</U>. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) <U>Scheduled Payment; Maturity</U>. Provided the Conversion shall not have occurred pursuant to the Holder&#146;s Conversion rights
hereunder, the Company shall pay the principal amount outstanding under this Note and accrued and unpaid interest thereon, if any, to the Holder on the date which is the earlier of: (i)&nbsp;June&nbsp;30, 2016 or (ii)&nbsp;the execution of the
Italian Agreement (defined in <U>Section&nbsp;12</U> hereof) (such earlier date, the &#147;<U>Maturity Date</U>&#148;), as the same may be extended by the mutual agreement of the Company and the Holder. </P>

<p Style='page-break-before:always'>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) <U>Conversion</U>. Upon conversion of the entire outstanding principal amount of this Note
plus all accrued and unpaid interest thereon into a membership interest in the Company in accordance with <U>Section&nbsp;4</U> hereof (the &#147;<U>Conversion</U>&#148;), this Note shall be deemed cancelled and shall be deemed paid in full and the
Company shall have no further obligation to the Holder (other than the obligation to issue the membership interest into which this Note has been converted). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(c) <U>No Cash Prepayment</U>. The outstanding principal amount of, and accrued but unpaid interest on, this Note shall not be repaid by the
Company in cash prior to the Maturity Date (except upon a liquidation event or as otherwise expressly set forth herein) without the written consent of Holder. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">3. <U>Events of Default</U>. For purposes of this Note, an &#147;<U>Event of Default</U>&#148; shall have been deemed to have occurred if: </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) the Company makes an assignment for the benefit of creditors or admits in writing its inability to pay its debts generally as they become
due; or an order, judgment or decree is entered adjudicating the Company bankrupt or insolvent; or any order for relief with respect to the Company is entered under the U.S. Federal Bankruptcy Code; or the Company petitions or applies to any
tribunal for the appointment of a custodian, trustee, receiver or liquidator of the Company, or of any substantial part of the assets of the Company, or commences any proceeding (other than a proceeding for the voluntary liquidation and dissolution
of any subsidiary) relating to the Company under any bankruptcy reorganization, arrangement, insolvency, readjustment of debt, dissolution or liquidation law of any jurisdiction; or any such petition or application is filed, or any such proceeding
is commenced, against the Company and either (A)&nbsp;the Company by any act indicates its approval thereof, consent thereto or acquiescence therein or (B)&nbsp;such petition, application or proceeding is not dismissed within sixty (60)&nbsp;days;
</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) the Company fails to pay any sum when due under this Note within ten (10)&nbsp;business days after the same becomes due and payable;
or </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(c) the Company fails to observe or perform any material covenant or agreement set forth in this Note (except a default in the payment
of money) or the Security Agreement within thirty (30)&nbsp;days after written notice thereof is received by the Company. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">If an Event of
Default specified in this <U>Section&nbsp;3</U> occurs, then the aggregate principal amount of this Note (together with all accrued but unpaid interest thereon) shall become immediately due and payable without any prior notice, presentment, demand
or any action on the part of the Holder, and the Company shall immediately pay to the Holder all amounts due and payable with respect to this Note. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">4.
<U>Conversion</U>. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) Subject to the terms and conditions of this Note, at any time after or simultaneously with the execution of the
Italian Agreement, upon five (5)&nbsp;days&#146; prior written </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">- 2 - </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
notice (the &#147;<U>Conversion Notice</U>&#148;), the Holder may convert all of the then outstanding principal amount of this Note plus all accrued and unpaid interest thereon (subject to
<U>Section&nbsp;5</U> hereof) into a membership interest in the Company which membership interest shall entitle the Holder to receive, upon liquidation of the Company, shares of Tua Autoworks Holdings S.&agrave;.r.l. (&#147;Tua Luxembourg&#148;)
equal to 5.74% of the outstanding capital shares of Tua Luxembourg as calculated immediately after such conversion (the &#147;<U>shares of Tua Luxembourg</U>&#148;), or, if the Holder elects to request an Independent Valuation Analysis (as defined
below), such percentage of the shares of Tua Luxembourg as determined by an Independent Valuation Analysis. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) The Company shall provide
written notice (the &#147;<U>Italian Agreement Notice</U>&#148;) to the Holder not later than ten (10)&nbsp;days prior to the execution of the Italian Agreement. The Italian Agreement Notice shall contain the material terms and conditions of the
Italian Agreement and the intended signing date of the Italian Agreement. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(c) The Conversion of this Note shall be deemed to have
occurred as of the close of business on the Conversion Date; and at such time, the rights of the Holder of this Note as such Holder shall cease, and the person or persons in whose name or names any certificate or certificates for shares of Tua
Luxembourg are to be issued upon such conversion shall be deemed to have become the holder or holders of record of the shares of Tua Luxembourg represented thereby. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(d) As soon as possible after the Conversion Date (but in any event within thirty (30)&nbsp;business days thereafter), the Company shall
deliver to the Holder a certificate or certificates representing the number of shares in Tua Luxembourg issuable by reason of the conversion of this Note in the name of Holder. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(e) The issuance of certificates for shares of Tua Luxembourg upon conversion of this Note (if any) and liquidation of the Company shall be
made without charge to the Holder for any issuance tax in respect thereof or other cost incurred by the Company in connection with such conversion and the related issuance of the shares of Tua Luxembourg. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(f) The Company shall assist and cooperate with the Holder with respect to any governmental filings or governmental approvals prior to or in
connection with the conversion of this Note (including, without limitation, making any filings required to be made by Tua Luxembourg or the Company). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(g) All shares of Tua Luxembourg shall, when issued, be duly and validly issued, fully paid and non-assessable and free from all taxes, liens
(other than liens imposed by or through the Holder and restrictions on transfer under Federal and state securities laws) and charges. The Company shall take all such actions as may be necessary to assure that all such shares of Tua Luxembourg may be
so issued without violation of any applicable law or governmental regulation. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(h) As soon as possible after written request of the
Holder, the Company, at its expense, shall engage a qualified business appraiser mutually selected by the Company and the Holder to appraise the value of Tua Luxembourg (an &#147;<U>Independent Valuation Analysis</U>&#148;). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(i) Upon written request of the Holder, the Company and Tua Luxembourg shall provide such additional information to which the Company
reasonably requests concerning the Company, Tua Luxembourg, and related entities. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">- 3 - </P>


<p Style='page-break-before:always'>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">5. <U>Liquidation Preference; Subordination</U>. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) In the event of a liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, and occurring prior to any
Conversion, the Company intends that the Holder will receive a preference equal to the amount the borrowings by the Company under this note plus accrued interest in the liquidation, dissolution or winding up of the Company ahead of all other holders
of debt of the Company except for Blu Investors LLC, which shall have priority over the obligation provided for herein with respect to a principal balance of $235,000 plus accrued interest (with the holder and Blu Investors subject to
<U>Section&nbsp;5(b)</U> below) and equity holders in the Company. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) Upon written request by the Company and provided that the Company
is not in breach of any of its obligations under this Note, the Holder shall execute and deliver any and all documents necessary or appropriate to subordinate its payment rights and security interests under this Note to Superior Debt of the Company.
For purposes of this Note, the term &#147;<U>Superior Debt</U>&#148; shall mean a borrowing from a bank or other financial institution regularly engaged in lending transactions, in any principal amount, for purposes of working capital (including
without limitation equipment purchases) used in the ordinary course of the Company&#146;s business. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">6. <U>Cancellation</U>. After all principal and
accrued interest at any time owed on this Note has been paid in full or, upon the conversion of this Note into shares of Tua Luxembourg pursuant to <U>Section&nbsp;4</U> hereof, this Note shall be surrendered to the Company for cancellation and
shall not be reissued. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">7. <U>Amendment and Waiver</U>. This Note may only be amended, modified or supplemented by an agreement in writing signed by the
Company and the Holder. Any of the terms of this Agreement may be waived, only by a written document signed by the party or parties waiving compliance. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">8. <U>Payments</U>. All payments to be made to the Holder shall be made in the lawful money of the United States of America in immediately available funds or
by certified check, at the option of the Company. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">9. <U>Place of Payment</U>. Delivery of this Note, principal and interest, when and if made, or shares
of Tua Luxembourg, if and when this Note is converted, shall be made to the Holder at the following address: </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">Deer Valley Corporation </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">205 Carriage Street </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">Guin, AL
35563 </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">Attn: J. Steven Lawler </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">- 4 - </P>


<p Style='page-break-before:always'>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">10. <U>Business Days</U>. If any payment is due, or any time period for giving notice or taking action expires,
on a day which is a Saturday, Sunday or legal holiday in the Commonwealth of Pennsylvania, the payment shall be due and payable on, and the time period shall automatically be extended to, the next business day immediately following such Saturday,
Sunday or legal holiday, and interest shall continue to accrue at the required rate hereunder until any such payment is made. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">11. <U>Costs of
Enforcement</U>. In the event any action is taken to enforce the rights of the Holder, in addition to such other relief as may be granted, the Company shall be responsible for all reasonable costs and expenses, including reasonable attorneys&#146;
fees incurred in such action unless such action is without merit. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">12. <U>Definitions</U>. The following terms used in this Note shall have the following
meanings (and any of such terms may, unless the context otherwise requires, be used in the singular or the plural depending on the reference): </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Conversion Date</U>&#148; means the date of the occurrence of the Conversion. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Italian Agreement</U>&#148; means the closing of the transaction contemplated by a Development Agreement between a subsidiary of Tua
Luxembourg and the Government of Italy related to the establishment and financing of automotive manufacturing, assembly and retail operations in Italy. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Security Agreement</U>&#148; means that certain Security Agreement by and between the Company and the Holder dated as of the date
hereof. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">13. <U>Miscellaneous</U>. The rights and obligations under this Note shall be binding upon and inure to the benefit of the Company and the Holder
hereof and its respective successors and assigns; provided, however, that the Company may not assign this Note without the prior written consent of the Holder and the Holder may not assign this Note except in accordance with Federal and state
securities laws and regulations. This Note shall be construed in accordance with and governed by the laws of the State of Delaware (without regard to its conflict of laws principles). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">[Signature Page Follows] </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">- 5 - </P>


<p Style='page-break-before:always'>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">IN WITNESS WHEREOF, the Company has executed and delivered this Note as of the date first written above. </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><DIV ALIGN="right">
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="40%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt">


<TR>
<TD WIDTH="12%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="87%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3"><B>COMPANY</B>:<B></B></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16" COLSPAN="3"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3">BLU Autoworks LLC</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman"><I>s/ Anthony J. Bonidy</I></P></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Name:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Anthony J. Bonidy</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Title:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Manager</TD></TR></TABLE></DIV> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="13%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="86%"></TD></TR>

<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3"><B>Accepted and agreed:</B></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16" COLSPAN="3"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3"><B>HOLDER</B>:<B></B></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16" COLSPAN="3"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3" ROWSPAN="3">Deer Valley Corporation</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt"></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt"></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman"><I>J. Steven Lawler</I></P></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Name:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">J. Steven Lawler</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Title:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Vice President &#150; Finance</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16" COLSPAN="3"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3"><B>Tua Autoworks Holdings S.&agrave;.r.l. (as to the conversion rights)</B></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman"><I>s/ Anthony J. Bonidy</I></P></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Name:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Anthony J. Bonidy</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Title:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Manager</TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">[Signature Page to BLU Autoworks Secured Convertible Note] </P>
</BODY></HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.02
<SEQUENCE>3
<FILENAME>d110043dex1002.htm
<DESCRIPTION>SECURITY AGREEMENT
<TEXT>
<HTML><HEAD>
<TITLE>Security Agreement</TITLE>
</HEAD>
 <BODY BGCOLOR="WHITE">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right"><B>Exhibit 10.02 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>SECURITY AGREEMENT </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">This
SECURITY AGREEMENT, dated as of December&nbsp;22, 2015 (this &#147;<B>Agreement</B>&#148;), is entered into by and between BLU Autoworks LLC, a Delaware limited liability company (the &#147;<B>Grantor</B>&#148;), in favor of Deer Valley Corporation,
a Florida corporation (the &#147;<B>Secured Party</B>&#148;). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">WHEREAS, on the date hereof, the Secured Party has made a loan to the
Grantor in an aggregate principal amount of up to $4,000,000 (the &#147;<B>Loan</B>&#148;), evidenced by that certain Secured Convertible Note of even date herewith (as amended, supplemented or otherwise modified from time to time, the
&#147;<B>Note</B>&#148;) made by the Grantor and payable to the order of the Secured Party. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">WHEREAS, this Agreement is given by the
Grantor in favor of the Secured Party to secure the payment and performance of all of the Secured Obligations (as defined below); and </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">NOW, THEREFORE, in consideration of the mutual covenants, terms and conditions set forth herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">1. <U>Definitions</U>. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) Unless otherwise specified herein, all references to Sections and Schedules herein are to Sections and Schedules of this Agreement. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) Unless otherwise defined herein, terms used herein that are defined in the UCC shall have the meanings assigned to them in the UCC.
However, if a term is defined in Article 9 of the UCC differently than in another Article of the UCC, the term has the meaning specified in Article&nbsp;9. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(c) For purposes of this Agreement, the following terms shall have the following meanings: </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<B>Collateral</B>&#148; has the meaning set forth in <U>Section 2</U>. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<B>Copyrights</B>&#148; means all of the following now owned or hereafter acquired by the Grantor: (i)&nbsp;all copyrights,
registrations and applications therefor, (ii)&nbsp;all renewals and extensions thereof, (iii)&nbsp;all income, royalties, damages and payments now and hereafter due or payable or both with respect thereto, including, without limitation, damages and
payments for past or future infringements or misappropriations thereof, (iv)&nbsp;all rights to sue for past, present and future infringements or misappropriations thereof, and (v)&nbsp;all other rights corresponding thereto throughout the world.
</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<B>Event of Default</B>&#148; has the meaning set forth in the Note. </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<B>First Priority</B>&#148;&nbsp;means, with respect to any lien and security interest
purported to be created in any Collateral pursuant to this Agreement, such lien and security interest is the most senior lien to which such Collateral is subject (subject only to liens permitted under the Note). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<B>Patents</B>&#148; means all of the following now or hereafter owned by the Grantor: (i)&nbsp;all patents and patent applications,
(ii)&nbsp;all inventions and improvements described and claimed therein, (iii)&nbsp;all reissues, divisions, continuations, renewals, extensions and continuations-in-part thereof, (iv)&nbsp;all income, royalties, damages and payments now and
hereafter due and/or payable to the Grantor with respect thereto, including, without limitation, damages and payments for past or future infringements or misappropriations thereof, (v)&nbsp;all rights to sue for past, present and future
infringements or misappropriations thereof and (vi)&nbsp;all other rights corresponding thereto throughout the world. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<B>Proceeds</B>&#148;&nbsp;means &#147;proceeds&#148; as such term is defined in section 9-102 of the UCC and, in any event, shall
include, without limitation, all dividends or other income from the Collateral, collections thereon or distributions with respect thereto. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<B>Secured Obligations</B>&#148;&nbsp;has the meaning set forth in <U>Section 3</U>. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<B>Trademarks</B>&#148; means all of the following, now owned or hereafter acquired by the Grantor: (i)&nbsp;all trademarks (including
service marks and trade names, whether registered or at common law), registrations and applications therefor, and the entire product lines and goodwill of the Grantor&#146;s business connected therewith and symbolized thereby, (ii)&nbsp;all renewals
thereof, (iii)&nbsp;all income, royalties, damages and payments now and hereafter due or payable or both with respect thereto, including, without limitation, damages and payments for past or future infringements or misappropriations thereof,
(iv)&nbsp;all rights to sue for past, present and future infringements or misappropriations thereof and (v)&nbsp;all other rights corresponding thereto throughout the world. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<B>Trade Secrets</B>&#148; means all of the following, now owned or hereafter acquired by the Grantor: (i)&nbsp;trade secrets,
(ii)&nbsp;income, royalties, damages and payments now and hereafter due and/or payable to the Grantor with respect to trade secrets, including, without limitation, damages and payments for past or future infringements or misappropriations thereof,
(iii)&nbsp;rights to sue for past, present and future infringements or misappropriations of trade secrets, and (iv)&nbsp;all other rights corresponding to trade secrets throughout the world. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<B>UCC</B>&#148;&nbsp;means the Uniform Commercial Code as in effect from time to time in the State of Delaware or, when the laws of any
other state govern the method or manner of the perfection or enforcement of any security interest in any of the Collateral, the Uniform Commercial Code as in effect from time to time in such state. </P>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">2. <U>Grant of Security Interest</U>. Subject to the rights granted previously to BLU Investors LLC pursuant to a
security agreement dated February&nbsp;27, 2015, which are in all respects superior to the rights of Secured Party hereunder, the Grantor hereby pledges and grants to the Secured Party, and hereby creates a continuing First Priority lien and
security interest in favor of the Secured Party in and to all of its right, title and interest in and to the following, wherever located, whether now existing or hereafter from time to time arising or acquired (collectively, the
&#147;<B>Collateral</B>&#148;): </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) all fixtures and personal property of every kind and nature including all accounts (including
health-care-insurance receivables), goods (including inventory and equipment), documents (including, if applicable, electronic documents), instruments, promissory notes, chattel paper (whether tangible or electronic), letters of credit,
letter-of-credit rights (whether or not the letter of credit is evidenced by a writing), securities and all other investment property, commercial tort claims described on <U>Schedule&nbsp;1</U> hereof as supplemented by any written notification
given by the Grantor to the Secured Party pursuant to <U>Section&nbsp;4(e)</U>, general intangibles (including all payment intangibles), Patents, Trademarks, Copyrights, Trade Secrets, money, deposit accounts, and any other contract rights or rights
to the payment of money; and </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) all Proceeds and products of each of the foregoing, all books and records relating to the foregoing, all
supporting obligations related thereto, and all accessions to, substitutions and replacements for, and rents, profits and products of, each of the foregoing, and any and all Proceeds of any insurance, indemnity, warranty or guaranty payable to the
Grantor from time to time with respect to any of the foregoing. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">3. <U>Secured Obligations</U>. The Collateral secures the due and prompt payment and
performance of the following (collectively, the &#147;<B>Secured Obligations</B>&#148;): </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) the obligations of the Grantor from time to
time arising under the Note, this Agreement or otherwise with respect to the due and prompt payment of the principal of and premium, if any, and interest on the Loan (including interest accruing during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding), when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise; and </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) all other covenants, duties, debts, obligations and liabilities of any kind of the Grantor under or in respect of the Note, this Agreement
or any other document made, delivered or given in connection with any of the foregoing. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">4. <U>Perfection of Security Interest and Further Assurances</U>.
</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) The Grantor shall, from time to time, as may be required by the Secured Party with respect to all Collateral, promptly take all
actions as may be requested by the Secured Party to perfect the security interest of the Secured Party in the Collateral, including, without limitation, with respect to all Collateral over which control may be obtained within the meaning of sections
8-106, 9-104, 9-105, 9-106 and 9-107 of the UCC, section 201 of the federal Electronic Signatures in Global and National Commerce Act and, as the case may be, section 16 of the Uniform Electronic Transactions Act, as applicable, the Grantor shall
promptly take all actions as may be requested from time to time by the Secured Party so that control of such Collateral is obtained and at all times held by the Secured Party. All of the foregoing shall be at the sole cost and expense of the
Grantor. </P>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) The Grantor hereby irrevocably authorizes the Secured Party at any time and from time to time
to file in any relevant jurisdiction any financing statements and amendments thereto that contain the information required by Article 9 of the UCC of each applicable jurisdiction for the filing of any financing statement or amendment relating to the
Collateral, including any financing or continuation statements or other documents for the purpose of perfecting, confirming, continuing, enforcing or protecting the security interest granted by the Grantor hereunder, without the signature of the
Grantor where permitted by law, including the filing of a financing statement describing the Collateral as all assets now owned or hereafter acquired by the Grantor, or words of similar effect. The Grantor agrees to provide all information required
by the Secured Party pursuant to this Section promptly to the Secured Party upon request. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(c) The Grantor hereby further authorizes the
Secured Party to file with the United States Patent and Trademark Office and the United States Copyright Office (and any successor office and any similar office in any state of the United States or in any other country) this Agreement, that certain
Intellectual Property Security Agreement entered into between the Grantor and the Secured Party as of the date hereof and any other documents for the purpose of perfecting, confirming, continuing, enforcing or protecting the security interest
granted by the Grantor hereunder, without the signature of the Grantor where permitted by law. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(d) If the Grantor shall at any time hold
or acquire any certificated securities, promissory notes, tangible chattel paper, negotiable documents or warehouse receipts relating to the Collateral, the Grantor shall promptly endorse, assign and deliver the same to the Secured Party,
accompanied by such instruments of transfer or assignment duly executed in blank as the Secured Party may from time to time specify. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(e)
If the Grantor shall at any time hold or acquire a commercial tort claim, the Grantor shall (i)&nbsp;promptly notify the Secured Party in a writing signed by the Grantor of the particulars thereof and grant to the Secured Party in such writing a
security interest therein and in the proceeds thereof, all upon the terms of this Agreement, with such writing to be in form and substance satisfactory to the Secured Party and (ii)&nbsp;deliver to the Secured Party an updated <U>Schedule 1</U>.
</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(f) The Grantor agrees that at any time and from time to time, at the expense of the Grantor, the Grantor will promptly execute and
deliver all further instruments and documents, obtain such agreements from third parties, and take all further action, that may be necessary or desirable, or that the Secured Party may reasonably request, in order to perfect and protect any security
interest granted hereby or to enable the Secured Party to exercise and enforce its rights and remedies hereunder or under any other agreement with respect to any Collateral. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">5. <U>Representations and Warranties</U>. The Grantor represents and warrants as follows: </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) It is a limited liability company validly existing and in good standing under the laws of the State of Delaware, and has the requisite
power and authority to own its properties and assets and to transact the businesses in which it presently is engaged or proposes to be engaged, and has full power, authority and legal right to borrow the Loan and pledge the Collateral pursuant to
this Agreement. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">4 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) Each of this Agreement and the Note has been duly authorized, executed and delivered by the
Grantor and constitutes a legal, valid and binding obligation of the Grantor enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors&#146; rights
generally and subject to equitable principles (regardless of whether enforcement is sought in equity or at law). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(c) No authorization,
approval, or other action by, and no notice to or filing with, any governmental authority or regulatory body is required for the borrowing of the Loan and the pledge by the Grantor of the Collateral pursuant to this Agreement or for the execution
and delivery of the Note and this Agreement by the Grantor or the performance by the Grantor of its obligations thereunder. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(d) The
execution and delivery of the Note and this Agreement by the Grantor and the performance by the Grantor of its obligations thereunder, will not violate any provision of any applicable law or regulation or any order, judgment, writ, award or decree
of any court, arbitrator or governmental authority, domestic or foreign, applicable to the Grantor or any of its property, or the organizational or governing documents of the Grantor or any agreement or instrument to which the Grantor is party or by
which it or its property is bound. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(e) Any Collateral consisting of securities have been duly authorized and validly issued, and are
fully paid and non-assessable and subject to no options to purchase or similar rights. The Grantor holds no commercial tort claims except as indicated on <U>Schedule&nbsp;1</U>. None of the Collateral constitutes, or is the proceeds of, &#147;farm
products&#148; as defined in section 9-102(a)(34) of the UCC. None of the account debtors or other persons obligated on any of the Collateral is a governmental authority covered by the Federal Assignment of Claims Act or like federal, state or local
statute or rule in respect of such Collateral. The Grantor has at all times operated its business in compliance with all applicable provisions of the federal Fair Labor Standards Act, as amended, and with all applicable provisions of federal, state
and local statutes and ordinances dealing with the control, shipment, storage or disposal of hazardous materials or substances. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(f) At
the time the Collateral becomes subject to the lien and security interest created by this Agreement, the Grantor will be the sole, direct, legal and beneficial owner thereof, free and clear of any lien, security interest, encumbrance, claim, option
or right of others except for the security interest created by this Agreement. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(g) The pledge of the Collateral pursuant to this
Agreement creates a valid and perfected First Priority security interest in the Collateral, securing the payment and performance when due of the Secured Obligations. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(h) The Grantor has taken all action required on its part for control (as defined in sections 8-106, 9-104, 9-105, 9-106 and 9-107 of the UCC,
section 201 of the federal Electronic Signatures in Global and National Commerce Act and, as the case may be, section 16 of the Uniform Electronic Transactions Act, as applicable) to have been obtained by the Secured Party over all Collateral with
respect to which such control may be obtained pursuant to the UCC. No person other than the Secured Party has control or possession of all or any part of the Collateral. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">5 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">6. <U>Covenants</U>. The Grantor covenants as follows: </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) The Grantor will not, without providing at least thirty (30)&nbsp;days prior written notice to the Secured Party, change its legal name,
identity, type of organization, jurisdiction of organization, corporate structure, or location of its chief executive office or its principal place of business or its organizational identification number. The Grantor will, prior to any change
described in the preceding sentence, take all actions reasonably requested by the Secured Party to maintain the perfection and priority of the Secured Party&#146;s security interest in the Collateral. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) The Collateral, to the extent not delivered to the Secured Party pursuant to <U>Section&nbsp;4</U>, will be kept at the Grantor&#146;s
principal place of business and the Grantor will not remove the Collateral from such locations without providing at least thirty (30)&nbsp;days prior written notice to the Secured Party. The Grantor will, prior to any change described in the
preceding sentence, take all actions reasonably required by the Secured Party to maintain the perfection and priority of the Secured Party&#146;s security interest in the Collateral. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(c) The Grantor shall, at its own cost and expense, defend title to the Collateral and the First Priority lien and security interest of the
Secured Party therein against the claim of any person claiming against or through the Grantor and shall maintain and preserve such perfected First Priority security interest for so long as this Agreement shall remain in effect. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(d) The Grantor will not sell, offer to sell, dispose of, convey, assign or otherwise transfer, grant any option with respect to, restrict, or
grant, create, permit or suffer to exist any mortgage, pledge, lien, security interest, option, right of first offer, encumbrance or other restriction or limitation of any nature whatsoever on, any of the Collateral or any interest therein except
(i)&nbsp;as expressly provided for in the Note or herein, (ii)&nbsp;to Tua Autoworks Holdings S.&agrave;r.l., a company to be formed under the laws of Luxembourg or (iii)&nbsp;with the prior written consent of the Secured Party. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(e) The Grantor will keep the Collateral in good order and repair and will not use the same in violation of law or any policy of insurance
thereon. The Grantor will permit the Secured Party, or its designee, to inspect the Collateral at any reasonable time, wherever located. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(f) The Grantor will pay promptly when due all taxes, assessments, governmental charges, and levies upon the Collateral or incurred in
connection with the use or operation of the Collateral or incurred in connection with this Agreement. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(g) The Grantor will continue to
operate its business in compliance with all applicable provisions of the federal Fair Labor Standards Act, as amended, and with all applicable provisions of federal, state and local statutes and ordinances dealing with the control, shipment, storage
or disposal of hazardous materials or substances. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">7. <U>Secured Party Appointed Attorney-in-Fact</U>. The Grantor hereby appoints the Secured Party the
Grantor&#146;s attorney-in-fact, with full authority in the place and stead of the Grantor and in the name of the Grantor or otherwise, from time to time during the continuance of an Event of Default, in the Secured Party&#146;s discretion to take
any action and to execute any instrument which the Secured Party may deem necessary or advisable to accomplish the purposes of this </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">6 </P>


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Agreement (but the Secured Party shall not be obligated to and shall have no liability to the Grantor or any third party for failure to do so or take action). This appointment, being coupled with
an interest, shall be irrevocable. The Grantor hereby ratifies all that said attorneys shall lawfully do or cause to be done by virtue hereof. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">8.
<U>Secured Party May Perform</U>. If the Grantor fails to perform any obligation contained in this Agreement, the Secured Party may itself perform, or cause performance of, such obligation, and the expenses of the Secured Party incurred in
connection therewith shall be payable by the Grantor; <I>provided that</I> the Secured Party shall not be required to perform or discharge any obligation of the Grantor. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">9. <U>Reasonable Care</U>. The Secured Party shall have no duty with respect to the care and preservation of the Collateral beyond the exercise of reasonable
care. The Secured Party shall be deemed to have exercised reasonable care in the custody and preservation of the Collateral in its possession if the Collateral is accorded treatment substantially equal to that which the Secured Party accords its own
property, it being understood that the Secured Party shall not have any responsibility for (a)&nbsp;ascertaining or taking action with respect to any claims, the nature or sufficiency of any payment or performance by any party under or pursuant to
any agreement relating to the Collateral or other matters relative to any Collateral, whether or not the Secured Party has or is deemed to have knowledge of such matters, or (b)&nbsp;taking any necessary steps to preserve rights against any parties
with respect to any Collateral. Nothing set forth in this Agreement, nor the exercise by the Secured Party of any of the rights and remedies hereunder, shall relieve the Grantor from the performance of any obligation on the Grantor&#146;s part to be
performed or observed in respect of any of the Collateral. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">10. <U>Remedies Upon Default</U>. If any Event of Default shall have occurred and be
continuing: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) The Secured Party, without any other notice to or demand upon the Grantor, may assert all rights and remedies of a
secured party under the UCC or other applicable law, including, without limitation, the right to take possession of, hold, collect, sell, lease, deliver, grant options to purchase or otherwise retain, liquidate or dispose of all or any portion of
the Collateral. If notice prior to disposition of the Collateral or any portion thereof is necessary under applicable law, written notice mailed to the Grantor at its notice address as provided in <U>Section&nbsp;13</U> hereof ten (10)&nbsp;days
prior to the date of such disposition shall constitute reasonable notice, but notice given in any other reasonable manner shall be sufficient. So long as the sale of the Collateral is made in a commercially reasonable manner, the Secured Party may
sell such Collateral on such terms and to such purchaser(s) as the Secured Party in its absolute discretion may choose, without assuming any credit risk and without any obligation to advertise or give notice of any kind other than that necessary
under applicable law. Without precluding any other methods of sale, the sale of the Collateral or any portion thereof shall have been made in a commercially reasonable manner if conducted in conformity with reasonable commercial practices of
creditors disposing of similar property. To the extent permitted by applicable law, the Grantor waives all claims, damages and demands it may acquire against the Secured Party arising out of the exercise by it of any rights hereunder. The Grantor
hereby waives and releases to the fullest extent permitted by law any right or equity of redemption with respect to the Collateral, whether before or after sale hereunder, and all rights, if any, of marshalling the Collateral and any other security
for the Secured Obligations or otherwise. At any such sale, </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">7 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
unless prohibited by applicable law, the Secured Party or any custodian may bid for and purchase all or any part of the Collateral so sold free from any such right or equity of redemption.
Neither the Secured Party nor any custodian shall be liable for failure to collect or realize upon any or all of the Collateral or for any delay in so doing, nor shall it be under any obligation to take any action whatsoever with regard thereto. The
Secured Party shall not be obligated to clean-up or otherwise prepare the Collateral for sale. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) Any cash held by the Secured Party as
Collateral and all cash Proceeds received by the Secured Party in respect of any sale of, collection from, or other realization upon all or any part of the Collateral shall be applied in whole or in part by the Secured Party to the payment of
expenses incurred by the Secured Party in connection with the foregoing or incidental to the care or safekeeping of any of the Collateral or in any way relating to the Collateral or the rights of the Secured Party hereunder, including reasonable
attorneys&#146; fees, and the balance of such proceeds shall be applied or set off against all or any part of the Secured Obligations in such order as the Secured Party shall elect. Any surplus of such cash or cash Proceeds held by the Secured Party
and remaining after payment in full of all the Secured Obligations shall be paid over to the Grantor or to whomsoever may be lawfully entitled to receive such surplus. The Grantor shall remain liable for any deficiency if such cash and the cash
Proceeds of any sale or other realization of the Collateral are insufficient to pay the Secured Obligations and the fees and other charges of any attorneys employed by the Secured Party to collect such deficiency. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(c) If the Secured Party shall determine to exercise its rights to sell all or any of the Collateral pursuant to this Section, the Grantor
agrees that, upon request of the Secured Party, the Grantor will, at its own expense, do or cause to be done all such acts and things as may be necessary to make such sale of the Collateral or any part thereof valid and binding and in compliance
with applicable law. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">11. <U>No Waiver and Cumulative Remedies</U>. The Secured Party shall not by any act (except by a written instrument pursuant to
<U>Section&nbsp;12</U>), delay, indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or to have acquiesced in any Default or Event of Default. All rights and remedies herein provided are cumulative and are not
exclusive of any rights or remedies provided by law. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">12. <U>Amendments, Waivers and Consents</U>. None of the terms or provisions of this Agreement may
be amended, modified, supplemented or waived, and no consent to any departure by the Grantor therefrom shall be effective unless the same shall be in writing and signed by the Secured Party and the Grantor, and then such amendment, modification,
supplement, waiver or consent shall be effective only in the specific instance and for the specific purpose for which made or given. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">13.
<U>Severability</U>. The provisions of this Agreement are severable, and if any clause or provision shall be held invalid or unenforceable in whole or in part in any jurisdiction, then such invalidity or unenforceability shall affect only such
clause or provision, or part thereof, in such jurisdiction and shall not in any manner affect such clause or provision in any other jurisdiction, or any other clause or provision of this Agreement in any jurisdiction. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">8 </P>


<p Style='page-break-before:always'>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">14. <U>Addresses for Notices</U>. All notices and other communications provided for in this Agreement shall be in
writing and shall be given in the manner and become effective as set forth in the Note, and addressed to the respective parties at their addresses as specified on the signature pages hereof or as to either party at such other address as shall be
designated by such party in a written notice to each other party. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">15. <U>Continuing Security Interest; Further Actions</U>. This Agreement shall create a
continuing First Priority lien and security interest in the Collateral and shall (a)&nbsp;subject to <U>Section&nbsp;16</U>, remain in full force and effect until payment and performance in full of the Secured Obligations, (b)&nbsp;be binding upon
the Grantor, its successors and assigns, and (c)&nbsp;inure to the benefit of the Secured Party and its successors, transferees and assigns; <I>provided that</I> the Grantor may not assign or otherwise transfer any of its rights or obligations under
this Agreement without the prior written consent of the Secured Party. Without limiting the generality of the foregoing clause (c), any assignee of the Secured Party&#146;s interest in any agreement or document which includes all or any of the
Secured Obligations shall, upon assignment in accordance with Section&nbsp;13 of the Note, become vested with all the benefits granted to the Secured Party herein with respect to such Secured Obligations. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">16. <U>Termination; Release</U>. On the earlier of (i)&nbsp;the date on which all Secured Obligations have been paid and performed in full or (ii)&nbsp;the
date of the execution of a Development Agreement with the Government of Italy related to the establishment and financing of automotive manufacturing, assembly and retail operations in Italy, this Agreement will be terminated without any further
action required by the parties and the Secured Party will, at the request and sole expense of the Grantor, (a)&nbsp;duly assign, transfer and deliver to or at the direction of the Grantor (without recourse and without any representation or warranty)
such of the Collateral as may then remain in the possession of the Secured Party, together with any monies at the time held by the Secured Party hereunder, and (b)&nbsp;execute and deliver to the Grantor a proper instrument or instruments
acknowledging the satisfaction and termination of this Agreement. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">17. <U>Governing Law</U>. This Agreement and any claim, controversy, dispute or cause
of action (whether in contract or tort or otherwise) based upon, arising out of or relating to this Agreement and the transactions contemplated hereby shall be governed by, and construed in accordance with, the laws of the State of Delaware. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">18. <U>Counterparts; Entire Agreement</U>. This Agreement and any amendments, waivers, consents or supplements hereto may be executed in counterparts (and by
different parties hereto in different counterparts), each of which shall constitute an original, but all taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page to this Agreement by facsimile or in
electronic (i.e., &#147;pdf&#148; or &#147;tif&#148;) format shall be effective as delivery of a manually executed counterpart of this Agreement. This Agreement and the Note constitute the entire contract among the parties with respect to the
subject matter hereof and supersede all previous agreements and understandings, oral or written, with respect thereto. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">[SIGNATURE PAGE
FOLLOWS] </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">9 </P>


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<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written. </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><DIV ALIGN="right">
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="40%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt">


<TR>
<TD WIDTH="12%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="87%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3"><B>BLU Autoworks LLC</B>, as Grantor</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman"><I>Anthony J. Bonidy</I></P></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Name:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Anthony J. Bonidy</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Title:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Manager</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16" COLSPAN="3"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3">Address for Notices:</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16" COLSPAN="3"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">BLU Autoworks LLC</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">c/o LCV Capital
Management, LLC</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Centre City Tower, Suite 705</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">650 Smithfield
Street</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Pittsburgh, PA 15222</P> <P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:10pt; font-family:Times New Roman">Attn: Lodovico C. de
Visconti</P></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16" COLSPAN="3"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3" ROWSPAN="4"><B>Deer Valley Corporation</B>, as Secured Party</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt"></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt"></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt"></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman"><I>J. Steven Lawler</I></P></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Name:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">J. Steven Lawler</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Title:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Vice President - Finance</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16" COLSPAN="3"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3">Address for Notices:</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16" COLSPAN="3"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Deer Valley Corporation</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">205
Carriage Street</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Guin, AL 35563</P> <P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:10pt; font-family:Times New Roman">Attn: J. Steven
Lawler</P></TD></TR>
</TABLE></DIV> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">[Signature Page to Security Agreement] </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><U>SCHEDULE 1 </U></B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>COMMERCIAL TORT CLAIMS </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">None. </P>
</BODY></HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.03
<SEQUENCE>4
<FILENAME>d110043dex1003.htm
<DESCRIPTION>BARGAIN SALE AGREEMENT AND INITIAL ESCROW INSTRUCTIONS
<TEXT>
<HTML><HEAD>
<TITLE>Bargain Sale Agreement and Initial Escrow Instructions</TITLE>
</HEAD>
 <BODY BGCOLOR="WHITE">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right"><B>Exhibit 10.03 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><U>BARGAIN SALE AGREEMENT AND INITIAL ESCROW INSTRUCTIONS </U></B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">This Bargain Sale Agreement and Initial Escrow Instructions (&#147;Agreement&#148;), dated December&nbsp;1, 2015, for reference purposes only,
is entered into by and between THE INDUSTRIAL DEVELOPMENT BOARD OF THE TOWN OF SULLIGENT, INC., (&#147;Buyer&#148;), and Deer Valley Homebuilders, Inc., a Alabama Domestic Corporation, (&#147;Seller&#148;). </P>
<P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><U>Recitals </U></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">A.
Seller is the owner of approximately 13 acres of improved real property located in the City of Sulligent (&#147;City&#148;), County of Lamar (&#147;County&#148;), State of Alabama (&#147;State&#148;), as more particularly described on <U>Exhibit
A</U> attached to this Agreement (the &#147;Real Property&#148;). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">B. On the terms, conditions and provisions set forth in this Agreement,
Buyer desires to purchase, and Seller desires to sell to Buyer, the Property for public purposes. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">C. Buyer is a political subdivision of
the State of Alabama, and is included in the list of organizations described in Section&nbsp;170(c)(1) of the Internal Revenue Code of 1986, as amended, and the applicable regulations promulgated thereunder (the &#147;Code&#148;). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">D. Seller believes that the purchase price for the Property which is specified in this Agreement is substantially below the fair market value
of the Property. Seller intends that the difference between the purchase price and the fair market value shall be a charitable contribution to Buyer. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">NOW, THEREFORE, in consideration of the foregoing recitals and the mutual covenants contained herein, the parties agree as follows: </P>
<P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><U>Agreement </U></B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">1.
<B><U>Purchase and Sale</U>.</B> Seller agrees to sell to Buyer, and Buyer agrees to purchase from Seller, the Property on the terms and subject to the conditions set forth in this Agreement. The &#147;Effective Date&#148; of this Agreement shall be
the first date upon which both Seller and Buyer have executed this Agreement. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">2. <B><U>Purchase Price</U>.</B> The purchase price
(&#147;Purchase Price&#148;) for the Property shall be One Million One Hundred Fifty Thousand Dollars ($1,150,000.00). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(a) <U>Purchase
Price</U>. The Buyer shall pay to the Seller through a Bargain Sale purchase, based on a combination of cash and a charitable contribution. A Bargain Sale occurs when a seller sells a property for the less than current appraised value (based on an
IRS 561 appraisal to be performed by an MAI appraiser &#147;Appraised Value&#148;) to an IRS 561 approved organization (i.e. a municipality, not for profit entity, etc.) and is then able to use the difference between appraised value and cash
received as a tax deduction through a charitable contribution. The purchase price shall be the Appraised Value. The amount of monies owed by the The Industrial Development Board of the City of Sulligent, Inc. shall not exceed $350,000.00. </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(b) <U>Cash Amount</U>. Three Hundred Fifty Thousand Dollars ($350,000.00) (maximum amount paid
by The Industrial Development Board of the City of Sulligent). The cash amount will remain $350,000.00 regardless if the charitable deduction increases or decreases. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(c) <U>Charitable Contribution Amount (Tax Deduction)</U>. To be calculated by reducing the Appraised Value by the Cash Amount. Based upon the
appraised value of $1,150,000.00, the charitable contribution would be $800,000.00. The Industrial Development Board of the Town of Sulligent provides no assurance as to the charitable deduction since that is a matter between the Internal Revenue
Service and Deer Valley Homebuilders, Inc. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(d) <U>Earnest Money Deposit</U>. As evidence of good faith, Buyer will deposit in an escrow
account to be maintained by a mutually acceptable attorney, title insurance company, as escrow agent, the sum of $10,000.00 (the &#147;Earnest Money&#148;) which will be credited toward the purchase price. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">3. <B><U>Payment of Purchase Price</U>. </B>At least one (1)&nbsp;business day prior to Close of Escrow (as defined in Section&nbsp;4(b)
below), Buyer shall deposit with Tim R. Wadsworth, Attorney at Law, Post Office Box 987, 55051 Highway 17, Sulligent, Alabama 35586, (&#147;Escrow Holder&#148;) the Purchase Price in immediately available funds, which shall be paid to Seller at
Close of Escrow. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4. <B><U>Escrow</U>.</B> </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(a) <U>Opening of Escrow</U>. Within one (1)&nbsp;business day after the Effective Date, Seller shall open escrow (&#147;Escrow&#148;) with
Escrow Holder. Buyer and Seller agree to execute and deliver to Escrow Holder, in a timely manner, all escrow instructions necessary to consummate the transaction contemplated by this Agreement. If there is any inconsistency between such
supplemental instructions and this Agreement, this Agreement shall control. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(b) <U>Close of Escrow</U>. For the purpose of this
Agreement, the &#147;Close of Escrow&#148; shall be defined as the date that the Warranty Deed (as defined in Section&nbsp;5, below) affixed thereto, is recorded in the Official Records of Lamar County. The Close of Escrow shall occur on a date
mutually acceptable to Seller and Buyer, but in no event later than December&nbsp;31, 2015, unless extended by the mutual written consent of the parties hereto. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">5. <B><U>Conditions of Title</U>.</B> The Property shall be conveyed to Buyer by Seller by a Warranty Deed, subject only to (a)&nbsp;a lien to
secure payment of real estate taxes and assessments (other than the assessment bonds provided for in Section&nbsp;11(a) below), not delinquent; (b)&nbsp;such other title matters affecting the Property created by or with the written consent of Buyer;
( c) all applicable laws, ordinances, rules and governmental regulations (including, but not limited to, those relative to building, zoning and land use) affecting the development, use, occupancy or enjoyment of the Property; (d)&nbsp;all matters
which would be apparent from an inspection, or disclosed by the Survey; and (e)&nbsp;exceptions which are approved and/or accepted by Buyer in accordance with Section&nbsp;7(a)(I) of this Agreement, (collectively approved Conditions of Title). </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">6. <B><U>Buyer&#146;s Title Certificate</U>.</B> Title shall be evidenced by Certificate of Title
equal to the Cash Purchase Price, showing title to the Property vested in Buyer, subject only to the Approved Conditions of Certificate of Title (&#147;Title Certificate&#148;). Buyer shall pay the cost of the Certificate of Title. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">7. <B><U>Conditions to Close of Escrow</U>.</B> </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(a) <U>Conditions to Buyer&#146;s Obligations</U>: The Buyer&#146;s obligations to close and consummate the transaction contemplated by this
Agreement is subject to the satisfaction of the following conditions: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(i) <U>Title</U>. Pursuant to the terms and conditions of this
subsection, Buyer shall have the right to approve any and all matters of and exceptions to title of the Real Property. Buyer shall have ten (10)&nbsp;calendar days following receipt of the Title Documents to give Seller (&#147;Buyer&#146;s Title
Notice&#148;) of Buyer&#146;s approval or disapproval of the Title Documents. Notwithstanding the foregoing, Seller agrees to remove on the Close of Escrow any mortgages or liens whereby Seller is the borrower which are currently recorded against
the Property. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(ii) <U>Inspection</U>. For the period of time commencing on the Effective Date and ending on December&nbsp;15, 2015,
(&#147;Contingency Period&#148;), Buyer shall have the right to conduct any and all non-destructive inspections, investigations, tests and studies (including, without limitation, investigations with regard to zoning, building codes and other
governmental regulations, architectural inspections, engineering tests, economic feasibility studies and soils, seismic and geologic reports and environmental testing) with respect to the Property as Buyer may elect to make or maintain. The cost of
any such inspections, tests and/or studies shall be borne by Buyer. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">Between the Effective Date and the Close of Escrow, Buyer and
Buyer&#146;s employees, agents, contractors, subcontractors and consultants (collectively, &#147;Buyer&#146;s Representatives&#148;) shall have the right to enter upon the Property, at reasonable times during ordinary business hours upon prior
written notice to Seller to perform such inspections, investigations, tests and studies. Following any such tests or inspections, Buyer agrees to promptly return any portions of the Property damaged or altered by Buyer during such tests or
inspections to substantially the same condition which existed prior to such test or inspection. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">Prior to the expiration of the
Contingency Period, Buyer shall deliver to Seller written notice (&#147;Contingency Period Notice&#148;) of its approval or disapproval of the Property. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">If this Agreement is terminated pursuant to this subsection, Buyer shall deliver to Seller (y)&nbsp;the Documents and Materials delivered to
Buyer by Seller, and (z)&nbsp;at no cost and without warranty as to correctness, copies of all reports, studies, maps and engineering studies that were generated by third parties for Buyer with respect to the Property, including, but not limited to,
all environmental reports, surveys, marketing reports, geotechnical reports, lot studies and improvement plans; </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(iii) <U>Title
Certificate</U>. As of the Close of Escrow, Title Agent shall have committed to issue the Certificate of Title to Buyer. </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(iv) <U>Seller&#146;s Representations</U>. All representations and warranties made by Seller to
Buyer in this Agreement shall be true and correct on the date hereof and shall be true and correct in all material respects as of the Close of Escrow. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(v) <U>Seller&#146;s Obligations</U>. As of the Close of Escrow, Seller shall have performed all of the obligations required to be performed
by Seller under this Agreement. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(vi) <U>Approval by Buyer&#146;s Board of Directors</U>. Buyer&#146;s Industrial Development Board of
the City of Sulligent shall have ratified and approved Buyer&#146;s execution, delivery and performance of this Agreement (the &#147;Industrial Board&#148;). Buyer shall notify Seller and Escrow Holder promptly upon receipt of the Industrial Board
Approval. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(b) <U>Conditions to Seller&#146;s Obligations</U>. The Close of Escrow and Seller&#146;s obligation to consummate the
transaction contemplated in this Agreement are subject to the satisfaction of the following conditions for Seller&#146;s benefit on or prior to the dates designated below for the satisfaction of such conditions, or the Close of Escrow in absence of
a specified date: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(i) <U>Buyer&#146;s Obligations</U>. Buyer shall have timely performed all of the obligations required to be performed
by Buyer under this Agreement. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(ii) <U>Buyer&#146;s Representations</U>. All representations and warranties made by Buyer to Seller in
this Agreement shall be true and correct on the date hereof and shall be true and correct in all material respects as of the Close of Escrow. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:13%; font-size:10pt; font-family:Times New Roman">(iii) <U>Purchase Price</U>. Buyer shall have timely delivered to Escrow Holder the Purchase Price and other sums owing under this Agreement
in good funds. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">8. <B><U>Deposits By Seller</U>.</B> At least one (1)&nbsp;business day prior to the Close of Escrow, Seller shall deposit
with Escrow Holder the following documents: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(a) <U>Warranty Deed</U>. The Warranty Deed, duly executed and acknowledged in recordable
form by Seller. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(b) <U>Letter</U>. Letter from Seller when to make funding available to and who to give funds to. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">9. <B><U>Deposits By Buyer</U></B>. At least one (1)&nbsp;business day prior to Close of Escrow, Buyer shall deposit or cause to be deposited
with Escrow Holder the following: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(a) <U>Purchase Price</U>. The Purchase Price and prorations provided for herein, in cash or
immediately available funds. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(b) <U>Warranty Deed</U>. A copy of the form of Grant Deed signed read and approved. </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">10. <B><U>Costs and Expenses</U></B>. Any documentary transfer taxes charged by the County (if
any) shall be paid by Seller. Except as otherwise specified in this Agreement, Buyer shall pay any applicable City transfer taxes, escrow fees and recording charges. Buyer and Seller shall each pay all legal and professional fees and fees of other
consultants incurred by Buyer and Seller, respectively. All closing costs incurred through the Escrow relating to the Property shall be split <SUP STYLE="vertical-align:top">&nbsp;1</SUP>&#8260;<SUB STYLE="vertical-align:bottom">2</SUB> each between
Buyer and Seller. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">11. <B><U>Prorations</U></B>. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(a) <U>Taxes/Assessments</U>. All non-delinquent real estate taxes and non-delinquent assessments on the Property shall be prorated as of
12:01 a.m. on the day of the Close of Escrow based on the actual current tax bill. All delinquent taxes and all delinquent assessments, interest, and penalties, if any, on the Property shall be paid at the Close of Escrow from funds accruing to
Seller. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">12. <B><U>Corrections</U>.</B> If any errors or omissions are made regarding adjustments and prorations as set forth herein, the
parties shall make the appropriate corrections promptly upon discovery thereof. If any estimates are made at the Close of Escrow regarding adjustments or prorations, the party shall make the appropriate correction promptly when accurate information
becomes available. Any corrected adjustment or proration shall be paid in cash to the party entitled thereto. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">13. <B><U>Condition and
Inspection of Property</U></B>. Notwithstanding any other provision of this Agreement to the contrary, Seller makes no representation or warranty (except as expressly set forth in Section&nbsp;15 below) whatsoever regarding the Property, the
physical condition of the Property, its past use, its compliance with laws (including, without limitation, laws governing environmental matters, zoning, and land use), or its suitability for Buyer&#146;s intended use. Seller has not conducted any
investigation regarding the condition of the Property, and the Property is sold AS-IS, WHERE-IS, WITH ALL FAULTS, AND THERE IS NO WARRANTY, EXPRESS OR IMPLIED, REGARDING THE CONDITION OF THE PROPERTY. Buyer hereby represents and warrants that Buyer
is relying solely upon, and as of the expiration of the Contingency Period will have conducted its own independent inspection, investigation, and analysis of the Property as it deems necessary or appropriate in so acquiring the Property from Seller,
including, without limitation, any and all matters concerning the condition, use, sale, development or suitability for development of the Property. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">14. <B><U>Property Condition Waiver</U>.</B> Following the Close of Escrow, Buyer waives its right to recover from Seller, and the trustees,
members, managers, directors, officers, general partners, limited partners, employees and agents of Seller, (collectively, &#147;Seller&#146;s Representatives&#148;), and hereby releases Seller and Seller&#146;s Representatives from, any and all
damages, losses, liabilities, costs or expenses whatsoever (including attorney&#146;s fees and costs) and claims therefor, whether direct or indirect, known or unknown, foreseen or unforseen, which may arise on account of or in any way arising out
of or connected with (I)&nbsp;the physical condition of the Property, and (ii)&nbsp;the environmental condition of the Property. The foregoing waiver and release shall exclude only those losses, liabilities, damages, costs or expenses, and claims
therefor, arising from or attributable to (x)&nbsp;a material matter actually known to Seller (excluding constructive notice) and (1)&nbsp;not disclosed to Buyer and (2)&nbsp;not discovered by Buyer prior to the Close of Escrow, and (y)&nbsp;any
breach by Seller of its express representations or warranties under this Agreement. </P>

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<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">15. <B><U>Seller&#146;s Representations and Warranties</U>.</B> In consideration of Buyer
entering into this Agreement, Seller makes the representations and warranties set forth in this Section&nbsp;15. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(a) <U>Seller&#146;s
Authority</U>. Seller is the sole owner of fee title to the Property and has the legal power, right and authority to enter into this Agreement and the instruments referenced herein, and to consummate the transactions contemplated in the execution,
delivery and performance of this Agreement. Furthermore, the execution and delivery of this Agreement has been duly authorized and no other action by Seller is required in order to make it a valid and binding contractual obligation of Seller. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(b) <U>No Prior Transfers</U>. Seller has not previously sold, transferred or conveyed the Property, or granted to any other person or entity
any right or interest in all or any part of the Property and Seller has not entered into any executory contracts for the sale of all or any part of the Property (other than this Agreement), nor do there exist any rights of first refusal or options
to purchase the Property, other than this Agreement and except as may be set forth in the Title Documents or the Leases. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(c)
<U>Leases</U>. To the Seller&#146;s present actual knowledge, there are no leases or other agreements (whether oral or written) affecting or relating to the rights of any party with respect to the possession of the Property or any portion thereof
which will be in effect after Close of Escrow. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">16. <B><U>Buyer&#146;s Representations and Warranties</U>.</B> In consideration of Seller
entering into this Agreement as an inducement to Seller to sell the Property to Buyer, Buyer makes the following representations and warranties, each of which is material and is being relied upon by Seller. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(a) <U>Buyer&#146;s Authority</U>. Buyer has the legal right, power and authority to enter into this Agreement and to consummate the
transactions contemplated hereby, and the execution, delivery and performance of this Agreement as provided herein and no other action by Buyer is requisite to the valid and binding execution, deliver and performance of this Agreement. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(b) <U>Enforceability</U>. This Agreement and all documents required hereby to be executed by Buyer are and shall be valid, legally binding
obligations of and enforceable against Buyer in accordance with their terms. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(c) <U>No Side Agreements or Representations</U>. Buyer
represents, warrants and covenants to Seller that Buyer has entered into this Agreement based upon its rights and intentions to independently inspect the Property. Except as specifically provided in Section&nbsp;15 of this Agreement, Seller makes no
representation or warranty regarding the condition of the Property, its past use, or its suitability for Buyer&#146;s intended use. Buyer will be relying solely upon its own independent inspection, investigation, and analysis of the Property as it
deems necessary or appropriate in so acquiring the Property from Seller, including, without limitation, any and all matters concerning the condition, use, sale, development or suitability of the Property. </P>

<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">17. <B><U>Damage or Condemnation Prior to Closing</U>.</B> Seller shall promptly notify Buyer of
any casualty to the Property or any condemnation proceeding considered or commenced prior to the Close of Escrow. If any such damage or proceeding relates to or may result in the loss of any &#147;material portion&#148; (as defined herein) of the
Property, Seller or Buyer may, each at its option, elect either to (i)&nbsp;terminate this Agreement, in which event, except as otherwise provided herein, neither party shall have any further rights or obligations hereunder, or (ii)&nbsp;continue
the Agreement in effect, in which event upon the Close of Escrow, Buyer shall be entitled to any compensation, award, or other payments or relief resulting from such casualty or condemnation proceedings. The term &#147;material portion&#148; shall
mean damages greater than One Hundred Thousand Dollars ($100,000.00). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">18. <B><U>Notices</U>. </B>All notices, demands, consents, requests
or other communications required to or permitted to be given pursuant to this Agreement shall be in writing, shall be given only in accordance with the provisions of this Section, shall be addressed to the parties in the manner set forth below, and
shall be conclusively deemed to have been properly delivered: (a)&nbsp;upon receipt when hand delivered during normal business hours (provided that, notices which are hand delivered shall not be effective unless the sending party obtains a signature
of a person at such address that the notice has been received); (b)&nbsp;upon receipt when sent by facsimile to the number set forth below (provided that, notices given by facsimile shall not be effective unless the receiving party delivers the
notice also by one other method permitted under this Section); (c) upon the day of delivery if the notice has been deposited in an authorized receptacle of the United States Postal Service as first-class, registered or certified mail, postage
prepaid, with a return receipt requested (provided that, the sender has in its possession the return receipt to prove actual delivery); or (d)&nbsp;one (1)&nbsp;business day after the notice has been deposited with either Golden State Overnight;
FedEx or United Parcel Service to be delivered by overnight delivery (provided that, the sending party receives a confirmation of actual delivery from the courier). The addresses of the parties to receive notices are as follows: </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="92%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD WIDTH="46%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="53%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">TO SELLER:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="right">TO BUYER:</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Deer Valley Homebuilders, Inc.</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Danny J. Otts, Chairman</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Post Office Box 310</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Industrial Development Board of the Town of Sulligent, Inc.</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Guin, Alabama 35563</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Post Office Box 365</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Sulligent, Alabama 35586</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">TO ESCROW HOLDER:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Tim R. Wadsworth</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Attorney at Law</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Post Office Box 987</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Sulligent, Alabama 35586</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD></TR>
</TABLE>

<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Each party shall make an ordinary, good faith effort to ensure that it will accept or receive
notices that are given in accordance with this Section&nbsp;18, and that any person to be given notice actually receives such notice. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">19.
<B><U>Brokers</U>.</B> Seller represents it has not engaged a brokerage firm and owes no commission or finder&#146;s fee in connection with this transaction (&#147;Seller&#146;s Broker&#148;). Buyer represents it has not engaged any person entitled
to any brokerage commission or finder&#146;s fee in connection with this transaction. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">20. <B><U>Assignment</U>.</B> Buyer shall not
assign its right, title or interest in this Agreement to any other party without the prior written consent of Seller. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">21.
<B><U>Cooperation Covenants</U>.</B> </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(a) <U>Acknowledgment of Donation</U>. Buyer acknowledges that Seller intends to seek recognition by
the Internal Revenue Service (&#147;IRS&#148;) and the State of a non-cash charitable contribution with respect to the sale of the Property in accordance with this Agreement, as more particularly described in Recital E above. Buyer covenants to
reasonably cooperate with Seller with respect to such donation by completing the Noncash Charitable Donations Form (IRS Form 8283) and any corollary State form, and to complete related subsequent IRS and State forms, if any, as requested by Seller,
the IRS, or the State with respect to such non-cash charitable contribution. This covenant shall survive the Close of Escrow. The Donation will be based upon an appraisal from a licensed certified appraiser from the State of Alabama. All costs of
the appraiser shall be paid by Sellers. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">22. <B><U>Miscellaneous</U>.</B> </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(a) <U>Partial Invalidity</U>. If any term or provision of this Agreement or the application thereof to any person or circumstance shall, to
any extent, be invalid or unenforceable, the remainder of this Agreement, or the application of such term or provision to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and
each such term and provision of this Agreement shall be valid and be enforced to the fullest extent permitted by law. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(b) <U>Waivers</U>.
No waiver of any breach of any covenant or provision herein contained shall be deemed a waiver of any preceding or succeeding breach thereof, or of any other covenant or provision herein contained. No extension of time for performance of any
obligation or act shall be deemed an extension of the time for performance of any other obligation or act except those of the waiving party, which shall be extended by a period of time equal to the period of the delay. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(c) <U>Survival</U>. All of Buyer&#146;s and Seller&#146;s warranties, indemnities, representatives, covenants, obligations, undertakings and
agreements contained in this Agreement shall survive following the Close of Escrow. </P>

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<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(d) <U>Successors and Assigns</U>. Subject to Section&nbsp;20, this Agreement shall be binding
upon and shall inure to the benefit of the grantees, transferees, successors and permitted assigns of the parties hereto. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(e) <U>Entire
Agreement</U>. This Agreement (including all Recitals and Exhibits attached hereto), is the final expression of, and contains the entire agreement between, the parties with respect to the subject matter hereof and supersedes all prior understandings
with respect thereto. This Agreement may not be modified, changed, supplemented, suspended, canceled or terminated, nor may any obligations hereunder be waived, except by written instrument signed by the party to be charged or by its agent duly
authorized in writing or as otherwise expressly permitted herein. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(f) <U>Time of Essence</U>. Seller and Buyer acknowledge and agree that
time is strictly of the essence with respect to each and every term, condition, obligation and provision hereof and that failure to timely perform any of the terms, conditions, obligations or provisions hereof by either party shall constitute a
material breach of and non-curable (but waivable) default under this Agreement by the party so failing to perform. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(g) <U>Relationship of
Parties</U>. Nothing contained in this Agreement shall be deemed or construed by the parties to create the relationship of principal and agent, a partnership, joint venture or any other association between Buyer and Seller. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(h) <U>Construction/Exhibits</U>. Headings at the beginning of each paragraph and subparagraph are solely for the convenience of the parties
and are not a part of the Agreement. Whenever required by the context of this Agreement, the singular shall include the plural and the masculine shall include the feminine and vice versa. This Agreement shall not be construed as if it had been
prepared by one of the parties, but rather as if both parties had prepared the same. Unless otherwise indicated, all references to paragraphs, Sections, subparagraphs and subsections are to this Agreement. All exhibits referred to in this Agreement
are attached and incorporated herein by this reference. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(i) <U>Governing Law</U>. The parties hereto acknowledge that this Agreement has
been negotiated and entered into in the State of Alabama. The parties hereto expressly agree that this Agreement shall be governed by, interpreted under, and construed and enforced in accordance with the laws of the State of Alabama. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(j) <U>Possession of Property</U>. Subject to the Approved Conditions of Title, Buyer shall be entitled to the possession of the Property
immediately following the Close of Escrow. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(k) <U>Counterparts</U>. This Agreement may be executed in multiple counterparts, each of
which shall be deemed an original (including copies sent to a party by facsimile transmission or in portable document format (pdf)), but all of which, together, shall constitute one and the same instrument. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(l) <U>Recitals</U>. Each of the parties acknowledge and agree that the Recitals set forth above in this Agreement are true and correct. </P>

<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">23. <B><U>Appraisal</U>.</B> Seller will pay for a qualified appraisal (&#147;Appraisal&#148;)
from the Earnest Money. The Appraisal shall be done by a qualified appraiser (&#147;Appraiser&#148;) that complies with the requirements of Section&nbsp;170 of the Internal Revenue Code, the regulations, rulings and other pronouncements of the
Internal Revenue Service, including current IRS Publication 561. A copy of the appraisal will be provided to Seller and Buyer and dated a date no later than 30 days prior to the Closing except as consented to by the Buyer. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">24. <B><U>IRS Form 8283</U>. </B>Upon the receipt of a Warranty Deed for the Property at Closing, Buyer shall sign and deliver Internal
Revenue Service From 8283 to Seller for the appraised value. The form will represent that Buyer is a duly established non-profit corporation and qualified as a tax exempt public charity under Internal Revenue Service Code Section&nbsp;501(c)(3)
qualified to receive federal tax deductible contributions pursuant to the Internal Revenue Code 170. However, all parties understand that the amount of a charitable deduction under Section&nbsp;170 of the Internal Revenue Code is governed by the
Internal Revenue Code Regulations. Both parties understand that the maximum amount of monies due by the Buyer to obtain free and clear title of the Property being sold is $350,000.00. Any dispute between the Seller and the Internal Revenue Service
as to the amount of charitable deduction is governed by the Internal Revenue Code and Regulations and the interpretation of the laws to the facts of this transaction by any Federal and State. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">25. <B><U>Inspections and Due Diligence</U>.</B> Buyer shall have the right, at its sole cost and expense during the contingency period, to
perform any studies, inspections, or other due diligence it deems necessary or desirable on the Property, upon consent of Seller (&#147;Inspection Period&#148;), including but not limited to, acquiring necessary permits, Phase I or Phase II
environmental studies, structural, heating and cooling, survey, boundary lines, zoning, intended use and so forth. If inspections are not satisfactory to Buyer, based on Buyer&#146;s sole discretion, Buyer may cancel this proposed transaction by
providing written notice to Seller. Buyer will indemnify Seller from any claims for injury to person or property occurring during any testing or studies. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the dates set forth below. </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="100%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt">


<TR>
<TD WIDTH="4%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="42%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="3%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="4%"></TD>
<TD VALIGN="bottom"></TD>
<TD WIDTH="43%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3">BUYER:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">SELLER:</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16" COLSPAN="3"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3">THE INDUSTRIAL DEVELOPMENT BOARD OF THE TOWN OF SULLIGENT, INC.</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Deer Valley Homebuilders, Inc.</P> <P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:10pt; font-family:Times New Roman">An Alabama
Domestic Corporation</P></TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
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<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman"><I>/s/ Danny J. Otts</I></P></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman"><I>/s/ John S. Lawler</I></P></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Danny J. Otts, Chairman</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"><U>John S. Lawler</U>, Officer</TD></TR>
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<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Date:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">12/22/15</P></TD>
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<TD VALIGN="top"></TD>
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<TD VALIGN="top">Date:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">12/22/15</P></TD></TR>
</TABLE>

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<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><U>EXHIBIT A </U></B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B><U>Legal Description of the Real Property </U></B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">Said parcel being in and a part of the SE 1/4 of SW 1/4, Section&nbsp;22, Township 13 South, Range 15 West, Lamar County, Alabama, and being
more particularly described as follows: </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">Commencing at the Southwest corner of the SW 1/4 of SW 1/4, Section&nbsp;22, Township 13 South,
Range 15 West, Lamar County, Alabama; thence run North 88 degrees 18&#146; 31&#148; East along the South line of said SW 1/4 of SW 1/4 for a distance of 1318.61 feet to the Southwest corner of the SE 1/4 of SW 1/4 of said Section&nbsp;22; thence run
North 00 degrees 54&#146; 33&#148; West along the West line of said SE 1/4 of SW 1/4 for a distance of 369.95 feet to the point of beginning. FROM SAID POINT OF BEGINNING continue North 00 degrees 54&#146; 33&#148; West along the West line of said
SE 1/4 of SW 1/4 for a distance of 871.00 feet to a point on the southerly right-of-way of Alabama Highway 278 (120&#146; R.O.W.); thence run easterly along said southerly right-of-way for a distance of 612.12 feet; thence run S 00 degrees 28&#146;
56&#148; E for a distance of 994.72 feet; thence run North 86 degrees 50&#146; 37&#148; West for a distance of 600.00 feet to the point of beginning. Said parcel containing 13 acres, more or less. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">SOURCE OF TITLE: BOOK 452, PAGE 253 </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">This conveyance is made subject to the following: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">(i)</TD>
<TD ALIGN="left" VALIGN="top">Non delinquent real property taxes and all assessments and unpaid installments thereof which are not delinquent. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">(ii)</TD>
<TD ALIGN="left" VALIGN="top">Title to all minerals within and underlying the premises, together with all mining rights and other rights, privileges and immunities relating thereto. </TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">(iii)</TD>
<TD ALIGN="left" VALIGN="top">Power line, road and all utility easements </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">(iv)</TD>
<TD ALIGN="left" VALIGN="top">Title exceptions of record. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">(v)</TD>
<TD ALIGN="left" VALIGN="top">Items which a current and correct Survey or physical inspection would show. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
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<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">(vi)</TD>
<TD ALIGN="left" VALIGN="top">Matters learned by or described to Grantee or its agents prior to the expiration of the Closing. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">(vii)</TD>
<TD ALIGN="left" VALIGN="top">Environmental matters. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
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<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">(viii)</TD>
<TD ALIGN="left" VALIGN="top">Matters caused by, through, or under Grantee. </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR>
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">(ix)</TD>
<TD ALIGN="left" VALIGN="top">Any other Approval Conditions of Certificate of Title. </TD></TR></TABLE> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top" COLSPAN="3">BUYER:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">SELLER:</TD></TR>
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<TD HEIGHT="16" COLSPAN="3"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="4"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3" ROWSPAN="2">THE INDUSTRIAL DEVELOPMENT BOARD OF THE TOWN OF SULLIGENT, INC.</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" COLSPAN="3">Deer Valley Homebuilders, Inc.</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">An Alabama Domestic Corporation</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman"><I>/s/ Danny J. Otts</I></P></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman"><I>/s/ John S. Lawler</I></P></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Danny J. Otts, Chairman</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"><U>John S. Lawler</U>, Officer</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Date:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">12/22/15</P></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top">Date:</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">12/22/15</P></TD></TR>
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