On November 30, 2016, ERBA Diagnostics, Inc. entered into a promissory note, made to be effective as of November 28, 2016, in favor of Erba Diagnostics Mannheim GmbH (Erba Mannheim"), which provides for an unsecured loan of up to $1,000,000 (the Note"). Amounts outstanding under the Note will accrue interest at the rate of 3.5% per annum and will become due and payable on October 31, 2017, subject to acceleration upon the occurrence of certain specified events of default. The initial loan of principal under the Note in the amount of $400,000 occurred on November 28, 2016. Any subsequent loans of principal under the Note will be made in the amounts and at the times determined by the vote or written consent of the majority of the independent directors on the company's board of directors. The funding of any such subsequent loans will take place on the date that is fifteen 15 days after the date on which the independent directors have caused the Company to provide notice thereof to Erba Mannheim.