8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported):    March 22, 2011    

CTD HOLDINGS, INC.

(Exact name of small business issuer as specified in its charter)

Florida	000-30451	59-3029743
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification No.)
27317 N.W. 78th Avenue High Springs, FL		32643
(Address of principal executive offices)		(Zip Code)
(386) 454-0887
(Issuer’s telephone number, including area code)
(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

On March 22, 2011, CTD Holdings, Inc. (the “Company”) entered into a new $425,000 credit facility with SunState Federal Credit Union (the “Lender”).  The credit facility consists of (i) a $325,000 term loan (the “Term Loan”) and (i) a $100,000 revolving line of credit (the “Credit Line”).  Borrowings under the Term Loan accrue interest at 6.5% per annum; and borrowings under the Credit Line accrue interest at 6.5% per annum throughMarch 23, 2011 and thereafter at the Wall Street Journal U.S. Prime Rate plus 2% per annum, subject to a floor of 6.5% per annum.   The Term Loan is payable over five years in monthly installments of approximately $2,830 with a final balloon payment of approximately $250,920 due on March 22, 2016 or, at the Lender’s option, upon the earlier sale of the Company’s property located at 27317 N.W.78th Avenue, High Springs, Florida (the “Property”).  The Credit Line is payable upon demand.

The obligations under the Term Loan and the Credit Line are guaranteed by C.E. Rick Strattan, the Company’s President and Chief Executive Officer, and secured by substantially all of the Company’s assets.

The Term Loan and the Credit Line may be prepaid, in whole or in part, without penalty.  The Term Loan and the Credit Line contain customary events of default, with corresponding cure periods, including, payment defaults.  The mortgage also contains customary covenants including, among others, limitations on the Company’s right to grant liens and negative pledges.

The Term Loan proceeds will be used for the installation of manufacturing equipment in the Company's Aquaplex® cyclodextrin-complex manufacturing plant located in Alachua, Florida. The Credit Line will be used to provide working capital for general business purposes, including purchasing raw material for the manufacturing plant.

The foregoing description does not purport to be a complete description of the terms of the credit facility and is qualified in its entirety by reference to the documents attached hereto as Exhibits 10.1 through 10.10(collectively, the “Documents”)and incorporated herein by reference.

The Documents are provided to give investors information regarding the Documents’ respective terms.  They are not provided to give investors factual information about the Company or any other parties thereto.  In addition, the representations, warranties and covenants contained in the Documents were made only for purposes of those Documents and as of specific dates, were solely for the benefit of the parties to those Documents, and may be subject to limitations agreed by the contracting parties, including being qualified by disclosures exchanged between the parties in connection with the execution of the Documents.  The representations and warranties may have been made for the purposes of allocating contractual risk between the parties of the Documents instead of establishing these matters as facts, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors.  Persons reviewing the Documents are not third-party beneficiaries under the Documents and should not view the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or conditions of the Company.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

See the discussion under Item 1.01 above, which is incorporated under this Item 2.03 by reference.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.	Description
10.1	Commercial Loan Agreement dated March 22, 2011 by and between CTD Holdings, Inc. and SunState Federal Credit Union.
10.2	Promissory Note dated March 22, 2011 in the principal amount of $325,000 made by CTD Holdings, Inc. in favor of SunState Federal Credit Union.
10.3	Security Agreement dated March 22, 2011 by and between CTD Holdings, Inc. and SunState Federal Credit Union.
10.4	Mortgage dated March 22, 2011 made by CTD Holdings, Inc. in favor of SunState Federal Credit Union.
10.5	Assignment of Leases and Rents dated March 22, 2011 made by CTD Holdings, Inc. in favor of SunState Federal Credit Union.
10.6	Guaranty dated March 22, 2011 made by C.E. Rick Strattan in favor of SunState Federal Credit Union.
10.7	Commercial Loan Agreement dated March 22, 2011 by and between CTD Holdings, Inc. and SunState Federal Credit Union.
10.8	Promissory Note dated March 22, 2011 in the principal amount of $100,000 made by CTD Holdings, Inc. in favor of SunState Federal Credit Union.
10.9	Security Agreement dated March 22, 2011 by and between CTD Holdings, Inc. and SunState Federal Credit Union.
10.10	Guaranty dated March 22, 2011 made by C.E. Rick Strattan in favor of SunState Federal Credit Union.

SIGNATURES

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.

CTD HOLDINGS, INC.
By:	/s/ C.E. Rick Strattan
Name:	C.E. Rick Strattan
Title:	Chief Executive Officer

Date:  March 28, 2010

EXHIBIT INDEX

Exhibit No.	Description
10.1	Commercial Loan Agreement dated March 22, 2011 by and between CTD Holdings, Inc. and SunState Federal Credit Union.
10.2	Promissory Note dated March 22, 2011 in the principal amount of $325,000 made by CTD Holdings, Inc. in favor of SunState Federal Credit Union.
10.3	Security Agreement dated March 22, 2011 by and between CTD Holdings, Inc. and SunState Federal Credit Union.
10.4	Mortgage dated March 22, 2011 made by CTD Holdings, Inc. in favor of SunState Federal Credit Union.
10.5	Assignment of Leases and Rents dated March 22, 2011 made by CTD Holdings, Inc. in favor of SunState Federal Credit Union.
10.6	Guaranty dated March 22, 2011 made by C.E. Rick Strattan in favor of SunState Federal Credit Union.
10.7	Commercial Loan Agreement dated March 22, 2011 by and between CTD Holdings, Inc. and SunState Federal Credit Union.
10.8	Promissory Note dated March 22, 2011 in the principal amount of $100,000 made by CTD Holdings, Inc. in favor of SunState Federal Credit Union.
10.9	Security Agreement dated March 22, 2011 by and between CTD Holdings, Inc. and SunState Federal Credit Union.
10.10	Guaranty dated March 22, 2011 made by C.E. Rick Strattan in favor of SunState Federal Credit Union.

EX-10.1

Exhibit 10.1

LOAN NUMBER	LOAN NAME	ACCT. NUMBER	AGREEMENT DATE	INITIALS
103428-01	CTD Holdings, Inc.		03/22/11	BM
NOTE AMOUNT	INDEX (w/Margin)	RATE	MATURITY DATE	LOAN PURPOSE
$325,000.00	Not Applicable	6.500%	03/22/16	Commercial
		Creditor Use Only

COMMERCIAL LOAN AGREEMENT

Single Advance Loan

DATE AND PARTIES.  The date of this Commercial Loan Agreement (Agreement) is March 22, 2011.  The parties and their addresses are as follows:

LENDER:

SUNSTATE FEDERAL CREDIT UNION

405 SE 2nd Place

Gainesville, FL 32602

BORROWER:

CTD HOLDINGS, INC.

a Florida Corporation

27317 NW 78th Avenue

High Springs, FL 32643

1.DEFINITIONS.  For the purposes of this Agreement, the following terms have the following meanings.

A.Accounting Terms.  In this Agreement, any accounting terms that are not specifically defined will have their customary meanings under generally accepted accounting principles.

B.Insiders.  Insiders include those defined as insiders by the United States Bankruptcy Code, as amended; or to the extent left undefined, include without limitation any officer, employee, stockholder or member, director, partner, or any immediate family member of any of the foregoing, or any person or entity which, directly or indirectly, controls, is controlled by or is under common control with me.

C.Loan.  The Loan refers to this transaction generally, including obligations and duties arising from the terms of all documents prepared or submitted for this transaction.

D.Loan Documents.  Loan Documents refer to all the documents executed as a part of or in connection with the Loan.

E.Pronouns.  The pronouns “I”, “me” and “my” refer to every Borrower signing this Agreement, individually or together.  “You” and “your” refers to the Loan’s lender.

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F.Property.  Property is any property, real, personal or intangible, that secures my performance of the obligations of this Loan.

2.SINGLE ADVANCE.  In accordance with the terms of this Agreement and other Loan Documents, you will provide me with a term note in the amount of $325,000.00 (Principal).  I will receive the funds from this Loan in one advance.  No additional advances are contemplated, except those made to protect and preserve your interests as provided in this Agreement or other Loan Documents.

3.MATURITY DATE.  I agree to fully repay the Loan by March 22, 2016.

4.WARRANTIES AND REPRESENTATIONS.  I make to you the following warranties and representations which will continue as long as this Loan is in effect, except when this Agreement provides otherwise.

A.Power.  I am duly organized, and validly existing and in good standing in all jurisdictions in which I operate.  I have the power and authority to enter into this transaction and to carry on my business or activity as it is now being conducted and, as applicable, am qualified to do so in each jurisdiction in which I operate.

B.Authority.  The execution, delivery and performance of this Loan and the obligation evidenced by the Note are within my powers, have been duly authorized, have received all necessary governmental approval, will not violate any provision of law, or order of court or governmental agency, and will not violate any agreement to which I am a party or to which I am or any of my property is subject.

C.Name and Place of Business.  Other than previously disclosed in writing to you I have not changed my name or principal place of business within the last 10 years and have not used any other trade or fictitious name.  Without your prior written consent, I do not and will not use any other name and will preserve my existing name, trade names and franchises.

D.Hazardous Substances.  Except as I previously disclosed in writing and you acknowledge in writing, no Hazardous Substance, underground tanks, private dumps or open wells are currently located at, on, in, under or about the Property.

E.Use of Property.  After diligent inquiry, I do not know or have reason to know that any Hazardous Substance has been discharged, leached or disposed of, in violation of any Environmental Law, from the property onto, over or into any other property, or from any other property onto, over or into the property.

F.Environmental Laws.  I have no knowledge or reason to believe that there is any pending or threatened investigation, claim, judgment or order, violation, lien, or other notice under any Environmental Law that concerns me or the property.  The property and any activities on the property are in full compliance with all Environmental Law.

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G.Loan Purpose.  The purpose of this Loan is to refinance recent equipment purchase.

H.No Other Liens.  I own or lease all property that I need to conduct my business and activities.  I have good and marketable title to all property that I own or lease.  All of my Property is free and clear of all liens, security interests, encumbrances and other adverse claims and interests, except those to you or those you consent to in writing.

I.Compliance With Laws.  I am not violating any laws, regulations, rules, orders, judgments or decrees applicable to me or my property, except for those which I am challenging in good faith through proper proceedings after providing adequate reserves to fully pay the claim and its challenge should I lose.

5.FINANCIAL STATEMENTS.  I will prepare and maintain my financial records using consistently applied generally accepted accounting principles then in effect.  I will provide you with financial information in a form that you accept and under the following terms.

A.Certification.  I represent and warrant that any financial statements that I provide you fairly represents my financial condition for the stated periods, is current, complete, true and accurate in all material respects, includes all of my direct or contingent liabilities and there has been no material adverse change in my financial condition, operations or business since the date the financial information was prepared.

B.Frequency.  In addition to the financial statements provided to you prior to closing, I will provide you with current financial statements on an annual basis, or as otherwise requested by you, until I have performed all of my obligations under the Loan and you terminate the Loan in writing.

C.Rent Roll and Vacancy Analysis Report.  I will provide you with an annual report concerning my rental real estate property, listing for each month: my current tenants, the square footage each tenant rented, the rent each paid and each lease’s expiration date as well as the square footage that remained vacant.

D.Requested Information.  I will provide you with any other information about my operations, financial affairs and condition within 10 days after your request.

E.Additional Financial Statements Term.  DURING THE TERM OF THIS LOAN, I/WE WILL PROVIDE THE FOLLOWING INFORMATION WITHIN THE TIME FRAMES OUTLINED:

ANNUAL SIGNED FEDERAL TAX RETURNS DUE TO THE LENDER NO LATER THAN 105 DAYS FOLLOWING EACH FISCAL YEAR END.  IF AN EXTENSION IS FILED, A COPY OF SAME WILL PROMPTLY BE SUPPLIED TO THE LENDER AND THEN THE SIGNED COPY OF THE TAX RETURN WILL BE DUE TO THE LENDER THE SAME DAY IT IS DUE TO THE IRS.

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6.COVENANTS.  Until the Loan and all related debts, liabilities and obligations are paid and discharged, I will comply with the following terms, unless you waive compliance in writing.

A.Participation.  I consent to you participating or syndicating the Loan and sharing any information that you decide is necessary about me and the Loan with the other participants or syndicators.

B.Inspection.  Following your written request, I will immediately pay for all one-time and recurring out-of-pocket costs that are related to the inspection of my records, business or Property that secures the Loan.  Upon reasonable notice, I will permit you or your agents to enter any of my premises and any location where my Property is located during regular business hours to do the following.

(1)You may inspect, audit, check, review and obtain copies from my books, records, journals, orders, receipts, and any correspondence and other business related data.

(2)You may discuss my affairs, finances and business with any one who provides you with evidence that they are a creditor of mine, the sufficiency of which will be subject to your sole discretion.

(3)You may inspect my Property, audit for the use and disposition of the Property’s proceeds and proceeds of proceeds; or do whatever you decide is necessary to preserve and protect the Property and your interest in the Property.

After prior notice to me, you may discuss my financial condition and business operations with my independent accountants, if any, or my chief financial officer and I may be present during these discussions.  As long as the Loan is outstanding, I will direct all of my accountants and auditors to permit you to examine my records in their possession and to make copies of these records.  You will use your best efforts to maintain the confidentiality of the information you or your agents obtain, except you may provide your regulator, if any, with required information about my financial condition, operation and business or that of my parent, subsidiaries or affiliates.

C.Business Requirements.  I will preserve and maintain my present existence and good standing in the jurisdiction where I am organized and all of my rights, privileges and franchises.  I will do all that is needed or required to continue my business or activities as presently conducted, by obtaining licenses, permits and bonds everywhere I engage in business or activities or own, lease or locate my property.  I will obtain your prior written consent before I cease my business or before I engage in any new line of business that is materially different from my present business.

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D.Compliance with Laws.  I will not violate any laws, regulations, rules, orders, judgments or decrees applicable to me or my Property, except for those which I challenge in good faith through proper proceedings after providing adequate reserves to fully pay the claim and its appeal should I lose.  Laws include without limitation the Federal Fair Labor Standards Act requirements for producing goods, the federal Employee Retirement Income Security Act of 1974’s requirements for the establishment, funding and management of qualified deferred compensation plans for employees, health and safety laws, environmental laws, tax laws, licensing and permit laws.  On your request, I will provide you with written evidence that I have fully and timely paid my taxes, assessments and other governmental charges levied or imposed on me, my income or profits and my property.  Taxes include without limitation sales taxes, use taxes, personal property taxes, documentary stamp taxes, recordation taxes, franchise taxes, income taxes, withholding taxes, FICA taxes and unemployment taxes.  I will adequately provide for the payment of these taxes, assessments and other charges that have accrued but are not yet due and payable.

E.New Organizations.  I will obtain your written consent before organizing, merging into, or consolidating with an entity; acquiring all or substantially all the assets of another; materially changing the legal structure, management, ownership or financial condition; or effecting or entering into a domestication, conversion or interest exchange.

F.Other Liabilities.  I will not incur, assume or permit any debt evidenced by notes, bonds or similar obligations, except: debt in existence on the date of this Agreement and fully disclosed to you; debt subordinated in payment to you on conditions and terms acceptable to you; accounts payable incurred in the ordinary course of my business and paid under customary trade terms or contested in good faith with reserves satisfactory to you.

G. Notice to You.  I will promptly notify you of any material change in my financial condition, of the occurrence of a default under the terms of this Agreement or any other Loan Document, or a default by me under any agreement between me and any third party which materially and adversely affects my property, operations, financial condition or business.

H.Dispose of No Assets.  Without your prior written consent or as the Loan Documents permit, I will not sell, lease, assign, transfer, dispose of or otherwise distribute all or substantially all of my assets to any person other than in the ordinary course of business for the assets’ depreciated book value or more.

I.Insurance.  I will obtain and maintain insurance with insurers, in amounts and coverages that are acceptable to you and customary with industry practice.  This may include without limitation insurance policies for public liability, fire, hazard and extended risk, workers compensation, and, at your request, business interruption and/or rent loss insurance.  At your request, I will deliver to you certified copies of all of these insurance policies, binders or certificates.  I will obtain and maintain a mortgagee clause (or lender loss payable clause) endorsement - naming you as the loss payee.  If you require, I will also obtain an “additional insured” endorsement - naming you as an additional insured.  I will immediately notify you of cancellation or termination of insurance.  I will require all insurance policies to provide you with at least 10 days prior written notice to you of cancellation or modification.  I consent to you using or disclosing information relative to any contract of insurance required by the Loan for the purpose of replacing this insurance.  I also authorize my insurer and you to exchange all relevant information related to any contract of insurance required by any document executed as part of this Loan.

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J.Property Maintenance.  I will keep all tangible and intangible property that I consider necessary or useful in my business in good working condition by making all needed repairs, replacements and improvements and by making all rental, lease or other payments due on this property.

K.Property Loss.  I will immediately notify you, and the insurance company when appropriate, of any material casualty, loss or depreciation to the Property or to my other property that affects my business.

L.Additional Taxes.  I will pay all filing and recording costs and fees, including any recordation, documentary or transfer taxes or stamps, that are required to be paid with respect to this Loan and any Loan Documents.

M.Additional Covenants.  I/WE HEREBY AGREE AND WARRANT THAT AN ANNUAL MINIMUM GLOBAL DEBT SERVICE COVERAGE RATIO (GLOBAL DSCR) OF 1.25X WILL BE MAINTAINED.  THE RATIO WILL BE CALCULATED AS FOLLOWS: (NET INCOME FROM BORROWER AND ALL GUARANTORS + DEPRECIATION + INTEREST EXPENSE + INTANGIBLE AMORTIZATION EXPENSE) DIVIDED BY TOTAL DEBT SERVICE.

BORROWERS AGREE TO ESTABLISH AND MAINTAIN AN OPERATING ACCOUNT WITH SUNSTATE FEDERAL CREDIT UNION FOR THE TERM OF THIS LOAN.

7.INSURANCE.

A.Flood Insurance.  Flood insurance is not required at this time.  It may be required in the future should the property be included in an updated flood plain map.  If required in the future, I may obtain flood insurance from anyone I want that is reasonably acceptable to you.

8.DEFAULT.  I will be in default if any of the following events (known separately and collectively as an Event of Default) occur:

A.Payments.  I fail to make a payment in full when due.

B.Insolvency or Bankruptcy.  The death, dissolution or insolvency of, appointment of a receiver by or on behalf of, application of any debtor relief law, the assignment for the benefit of creditors by or on behalf of, the voluntary or involuntary termination of existence by, or the commencement of any proceeding under any present or future federal or state insolvency, bankruptcy, reorganization, composition or debtor relief law by or against me or any co-signer, endorser, surety or guarantor of this Agreement or any other obligations I have with you.

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C.Business Termination.  I merge, dissolve, reorganize, end my business or existence, or a partner or majority owner dies or is declared legally incompetent.

D.Failure to Perform.  I fail to perform any condition or to keep any promise or covenant of this Agreement.

E.Other Documents.  A default occurs under the terms of any other Loan Document.

F.Other Agreements.  I am in default on any other debt or agreement I have with you.

G.Misrepresentation.  I make any verbal or written statement or provide any financial information that is untrue, inaccurate, or conceals a material fact at the time it is made or provided.

H.Judgment.  I fail to satisfy or appeal any judgment against me.

I.Forfeiture.  The Property is used in a manner or for a purpose that threatens confiscation by a legal authority.

J.Name Change.  I change my name or assume an additional name without notifying you before making such a change.

K.Property Transfer.  I transfer all or a substantial part of my money or property.

L.Property Value.  You determine in good faith that the value of the Property has declined or is impaired.

M.Material Change.  Without first notifying you, there is a material change in my business, including ownership, management, and financial conditions.

N.Insecurity.  You determine in good faith that a material adverse change has occurred in my financial condition from the conditions set forth in my most recent financial statement before the date of this Agreement or that the prospect for payment or performance of the Loan is impaired for any reason.

O.Additional Default.  THE OCCURRENCE OF ANY DEFAULT OF THE BORROWER(S) IN PAYMENT OF THIS PROMISSORY NOTE SHALL ALSO CONSTITUTE AN EVENT OF DEFAULT WITH RESPECT TO THE INDEBTEDNESS OF THE BORROWER(S) EVIDENCED BY THAT CERTAIN PROMISSORY NOTE NUMBER 103428-02 DATED MARCH 22, 2011, EXECUTED BY CTD HOLDINGS, INC., IN THE ORIGINAL PRINCIPAL AMOUNT OF $100,000.00, TOGETHER WITH ANY AND ALL EXTENSIONS, RENEWALS, MODIFICATIONS, SUBSTITUTIONS, REPLACEMENTS, AND CHANGES IN FORM THEREOF, WHICH MAY FROM TIME TO TIME AND FOR ANY TERM OR TERMS ARE EFFECTED BY AN AGREEMENT BETWEEN BORROWER(S) AND THE LENDER.

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9.REMEDIES.  After I default, you may at your option do any one or more of the following.

A.Acceleration.  You may make all or any part of the amount owing by the terms of the Loan immediately due.  If I am a debtor in a bankruptcy petition or in an application filed under section 5(a)(3) of the Securities Investor Protection Act, the Loan is automatically accelerated and immediately due and payable without notice or demand upon filing of the petition or application.

B.Sources.  You may use any and all remedies you have under state or federal law or in any Loan Document.

C.Insurance Benefits.  You may make a claim for any and all insurance benefits or refunds that may be available on my default.

D.Payments Made On My Behalf.  Amounts advanced on my behalf will be immediately due and may be added to the balance owing under the terms of the Loan, and accrue interest at the highest post-maturity interest rate.

E.Set-Off.  You may use the right of set-off.  This means you may set-off any amount due and payable under the terms of the Loan against any right I have to receive money from you.

My right to receive money from you includes any deposit or share account balance I have with you; any money owed to me on an item presented to you or in your possession for collection or exchange; and any repurchase agreement or other non-deposit obligation.  “Any amount due and payable under the terms of the Loan” means the total amount to which you are entitled to demand payment under the terms of the Loan at the time you set-off.

Subject to any other written contract, if my right to receive money from you is also owned by someone who has not agreed to pay the Loan, your right of set-off will apply to my interest in the obligation and to any other amounts I could withdraw on my sole request or endorsement.

In addition, you may also have rights under a “statutory lien”.  A “statutory lien” means your right under state or federal law to establish a right in, or claim to, my shares and dividends to the extent of any outstanding financial obligations that I have with you.  If you have a statutory lien, you may without further notice, impress and enforce the statutory lien on my shares and dividends to the extent of any sums due and payable under the terms of the Loan that I fail to satisfy.

Your set-off and statutory lien rights do not apply to an account or other obligation where my rights arise only in a representative capacity.  They also do not apply to any Individual Retirement Account or other tax-deferred retirement account.

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You will not be liable for the dishonor of any check or share draft when the dishonor occurs because you set-off against any of my accounts, or exercised your statutory lien rights.  I agree to hold you harmless from any such claims arising as a result of your exercise of your right of set-off or statutory lien rights.

F.Waiver.  Except as otherwise required by law, by choosing any one or more of these remedies you do not give up your right to use any other remedy.  You do not waive a default if you choose not to use a remedy.  By electing not to use any remedy, you do not waive your right to later consider the event a default and to use any remedies if the default continues or occurs again.

10.COLLECTION EXPENSES AND ATTORNEYS’ FEES.  On or after the occurrence of an Event of Default, to the extent permitted by law, I agree to pay all expenses of collection, enforcement or protection of your rights and remedies under this Agreement or any other Loan Document.  Expenses include, but are not limited to, attorneys’ fees of 10 percent of the Principal sum due or a larger amount as the court judges as reasonable and just, court costs and other legal expenses.  These expenses are due and payable immediately.  If not paid immediately, these expenses will bear interest from the date of payment until paid in full at the highest interest rate in effect as provided for in the terms of this Loan.  All fees and expenses will be secured by the Property I have granted to you, if any.  In addition, to the extent permitted by the United States Bankruptcy Code, I agree to pay the reasonable attorneys’ fees incurred by you to protect your rights and interests in connection with any bankruptcy proceedings initiated by or against me.

11.APPLICABLE LAW.  This Agreement is governed by the laws of Florida, the United States of America, and to the extent required, by the laws of the jurisdiction where the Property is located, except to the extent such state laws are preempted by federal law.

12.JOINT AND INDIVIDUAL LIABILITY AND SUCCESSORS.  My obligation to pay the Loan is independent of the obligation of any other person who has also agreed to pay it.  You may sue me alone, or anyone else who is obligated on the Loan, or any number of us together, to collect the Loan.  Extending the Loan or new obligations under the Loan, will not affect my duty under the Loan and I will still be obligated to pay the Loan.  You may assign all or part of your rights or duties under this Agreement or the Loan Documents without my consent.  If you assign this Agreement, all of my covenants, agreements, representations and warranties contained in this Agreement or the Loan Documents will benefit your successors and assigns.  I may not assign this Agreement or any of my rights under it without your prior written consent.  The duties of the Loan will bind my successors and assigns.

13.AMENDMENT, INTEGRATION AND SEVERABILITY.  This Agreement may not be amended or modified by oral agreement.  No amendment or modification of this Agreement is effective unless made in writing and executed by you and me.  This Agreement and the other Loan Documents are the complete and final expression of the understanding between you and me.  If any provision of this Agreement is unenforceable, then the unenforceable provision will be severed and the remaining provisions will still be enforceable.

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14.INTERPRETATION.  Whenever used, the singular includes the plural and the plural includes the singular.  The section headings are for convenience only and are not to be used to interpret or define the terms of this Agreement.

15.NOTICE, FINANCIAL REPORTS AND ADDITIONAL DOCUMENTS.  Unless otherwise required by law, any notice will be given by delivering it or mailing it by first class mail to the appropriate party’s address listed in the DATE AND PARTIES section, or to any other address designated in writing.  Notice to one Borrower will be deemed to be notice to all Borrowers.  I will inform you in writing of any change in my name, address or other application information.  I will provide you any financial statement or information you request.  All financial statements and information I give you will be correct and complete.  I agree to sign, deliver, and file any additional documents or certifications that you may consider necessary to perfect, continue, and preserve my obligations under this Loan and to confirm your lien status on any Property.  Time is of the essence.

16.WAIVER OF JURY TRIAL.  All of the parties to this Agreement knowingly and intentionally, irrevocably and unconditionally, waive any and all right to a trial by jury in any litigation arising out of or concerning this Agreement or any other Loan Document or related obligation.  All of these parties acknowledge that this section has either been brought to the attention of each party’s legal counsel or that each party had the opportunity to do so.

17.SIGNATURES.  By signing, I agree to the terms contained in this Agreement.  I also acknowledge receipt of a copy of this Agreement.

MORTGAGOR:

CTD Holdings, Inc.

By: /s/ Charles E. Strattan                                 

Charles E. Strattan, President

LENDER:

Sunstate Federal Credit Union

By:/s/ Brian Miller                       

Brian Miller, Commercial Loan Officer

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EX-10.2

Exhibit 10.2

LOAN NUMBER	LOAN NAME	ACCT.  NUMBER	NOTE DATE	INITIALS
103428-01	CTD Holdings, Inc.		03/22/11	BM
NOTE AMOUNT	INDEX (w/Margin)	RATE	MATURITY DATE	LOAN PURPOSE
$325,000.00	Not Applicable	6.500%	03/22/16	Commercial
		Creditor Use Only

PROMISSORY NOTE

(Commercial - Single Advance)

State of Florida’s Documentary Stamps have been affixed to the security instrument which secures this Note and will be cancelled pursuant to law.

State of Florida’s Documentary Stamps have been affixed to the assignment of leases and rents which secures this Note and will be cancelled pursuant to law.

DATE AND PARTIES.  The date of this Promissory Note (Note) is March 22, 2011.  The parties and their addresses are:

LENDER:

SUNSTATE FEDERAL CREDIT UNION

405 SE 2nd Place

Gainesville, FL 32602

Telephone: (352) 381-5200 x5197

BORROWER:

CTD HOLDINGS, INC.

a Florida Corporation

27317 NW 78th Avenue

High Springs, FL 32643

1.DEFINITIONS.  As used in this Note, the terms have the following meanings:

A.Pronouns.  The pronouns “I,” “me,” and “my” refer to each Borrower signing this Note, individually and together.  “You” and “Your” refer to the Lender.

B.Note.  Note refers to this document, and any extensions, renewals, modifications and substitutions of this Note.

C.Loan.  Loan refers to this transaction generally, including obligations and duties arising from the terms of all documents prepared or submitted for this transaction such as applications, security agreements, disclosures or notes, and this Note.

D.Loan Documents.  Loan Documents refer to all the documents executed as a part of or in connection with the Loan.

E.Property.  Property is any property, real, personal or intangible, that secures my performance of the obligations of this Loan.

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F.Percent.  Rates and rate change limitations are expressed as annualized percentages.

2.PROMISE TO PAY.  For value received, I promise to pay you or your order, at your address, or at such other location as you may designate, the principal sum of $325,000.00 (Principal) plus interest from March 22, 2011 on the unpaid Principal balance until this Note matures or this obligation is accelerated.

3.INTEREST.  Interest will accrue on the unpaid Principal balance of this Note at the rate of 6.500 percent (Interest Rate).

A.Interest After Default.  If you declare a default under the terms of the Loan, including for failure to pay in full at maturity, you may increase the Interest Rate otherwise payable as described in this section.  In such event, interest may accrue at the maximum amount allowed by law, subject to your sole discretion.

B.Maximum Interest Amount.  Any amount assessed or collected as interest under the terms of this Note will be limited to the maximum lawful amount of interest allowed by state or federal law, whichever is greater.  Amounts collected in excess of the maximum lawful amount will be applied first to the unpaid Principal balance.  Any remainder will be refunded to me.

C.Accrual.  Interest accrues using an Actual/365 days counting method.

4.ADDITIONAL CHARGES.  As additional consideration, I agree to pay, or have paid, the fees and charges listed on the SETTLEMENT STATEMENT, which is attached to and made part of this Note.

5.REMEDIAL CHARGES.  In addition to interest or other finance charges, I agree that I will pay these additional fees based on my method and pattern of payment.  Additional remedial charges may be described elsewhere in this Note.

A.Late Charge.  If a payment is more than 10 days late, I will be charged 10.000 percent of the Amount of Payment.  I will pay this late charge promptly but only once for each late payment.

6.GOVERNING AGREEMENT.  This Note is further governed by the Commercial Loan Agreement executed between you and me as a part of this Loan, as modified, amended or supplemented. The Commercial Loan Agreement states the terms and conditions of this Note, including the terms and conditions under which the maturity of this Note may be accelerated.  When I sign this Note, I represent to you that I have reviewed and am in compliance with the terms contained in the Commercial Loan Agreement.

7.PAYMENT.  I agree to pay this Note in 60 payments.  This Note is amortized over 180 payments.  I will make 59 payments of $2,832.54 beginning on April 22, 2011, and on the 22nd day of each month thereafter.  A single “balloon payment” of the entire unpaid balance of Principal and interest will be due March 22, 2016.

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Payments will be rounded to the nearest $.01.  With the final payment I also agree to pay any additional fees or charges owing and the amount of any advances you have made to others on my behalf.  Payments scheduled to be paid on the 29th, 30th or 31st day of a month that contains no such day will, instead, be made on the last day of such month.

Each payment I make on this Note will be applied first to any charges that I owe other than principal and interest then to interest that is due, and finally to principal that is due.  If you and I agree to a different application of payments, we will describe our agreement on this Note.  You may change how payments are applied in your sole discretion without notice to me.  The actual amount of my final payment will depend on my payment record.

8.PREPAYMENT.  I may prepay this Loan in full or in part at any time.  Any partial prepayment will not excuse any later scheduled payments until I pay in full.

9.LOAN PURPOSE.  The purpose of this Loan is to refinance recent equipment purchase.

10.ADDITIONAL TERMS.  THE OCCURRENCE OF ANY DEFAULT OF THE BORROWER(S) IN PAYMENT OF THIS PROMISSORY NOTE SHALL ALSO CONSTITUTE AN EVENT OF DEFAULT WITH RESPECT TO THE INDEBTEDNESS OF THE BORROWER(S) EVIDENCED BY THAT CERTAIN PROMISSORY NOTE NUMBER 103428-02 DATED MARCH 22, 2011, EXECUTED BY CTD HOLDINGS, INC., IN THE ORIGINAL PRINCIPAL AMOUNT OF $100,000.00, TOGETHER WITH ANY AND ALL EXTENSIONS, RENEWALS, MODIFICATIONS, SUBSTITUTIONS, REPLACEMENTS, AND CHANGES IN FORM THEREOF, WHICH MAY FROM TIME TO TIME AND FOR ANY TERM OR TERMS ARE EFFECTED BY AN AGREEMENT BETWEEN BORROWER(S) AND THE LENDER.

11.SECURITY.  The Loan is secured by separate security instruments prepared together with this Note as follows:

Document Name	Parties to Document
Leases And Rents Assignment - 27317 NW 78th Avenue	CTD Holdings, Inc. f/k/a Cyclodextrin Technologies Development, Inc.
Security Agreement - CTD Holdings, Inc.	CTD Holdings, Inc. f/k/a Cyclodextrin Technologies Development, Inc.
Mortgage - 27317 NW 78th Avenue	CTD Holdings, Inc. f/k/a Cyclodextrin Technologies Development, Inc.

12.DUE ON SALE OR ENCUMBRANCE.  You may, at your option, declare the entire balance of this Note to be immediately due and payable upon the creation of, or contract for the creation of, any lien, encumbrance, transfer or sale of all or any part of the Property.  This right is subject to the restrictions imposed by federal law (12 C.F.R. 591), as applicable.

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13.WAIVERS AND CONSENT.  To the extent not prohibited by law, I waive, protest, presentment for payment, demand, notice of acceleration, notice of intent to accelerate and notice of dishonor.

A.Additional Waivers By Borrower.  In addition, I, and any party to this Note and Loan, to the extent permitted by law, consent to certain actions you may take, and generally waive defenses that may be available based on these actions or based on the status of a party to this Note.

(1)You may renew or extend payments on this Note, regardless of the number of such renewals or extensions.

(2)You may release any Borrower, endorser, guarantor, surety, accommodation maker or any other co-signer.

(3)You may release, substitute or impair any Property securing this Note.

(4)You, or any institution participating in this Note, may invoke your right of set-off.

(5)You may enter into any sales, repurchases or participations of this Note to any person in any amounts and I waive notice of such sales, repurchases or participations.

(6)I agree that any of us signing this Note as a Borrower is authorized to modify the terms of this Note or any instrument securing, guarantying or relating to this Note.

(7)I agree that you may inform any party who guarantees this Loan of any Loan accommodations, renewals, extensions, modifications, substitutions or future advances.

B.No Waiver By Lender.  Your course of dealing, or your forbearance from, or delay in, the exercise of any of your rights, remedies, privileges or right to insist upon my strict performance of any provisions contained in this Note, or any other Loan Document, shall not be construed as a waiver by you, unless any such waiver is in writing and is signed by you.

14.COMMISSIONS.  I understand and agree that you for your affiliate will earn commissions or fees on any insurance products, and may earn such fees on other services that I buy through you or your affiliate.

15.APPLICABLE LAW.  This Note is governed by the laws of Florida, the United States of America, and to the extent required, by the laws of the jurisdiction where the Property is located, except to the extent such state laws are preempted by federal law.

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16.JOINT AND INDIVIDUAL LIABILITY AND SUCCESSORS.  My obligation to pay the Loan is independent of the obligation of any other person who has also agreed to pay it. You may sue me alone, or anyone else who is obligated on the Loan, or any number of us together, to collect the Loan. Extending the Loan or new obligations under the Loan, will not affect my duty under the Loan and I will still be obligated to pay the Loan. This Note shall inure to the benefit of and be enforceable by you and your successors and assigns and shall be binding upon and enforceable against me and my personal representatives, successors, heirs and assigns.

17.AMENDMENT, INTEGRATION AND SEVERABILITY.  This Note may not be amended or modified by oral agreement.  No amendment or modification of this Note is effective unless made in writing and executed by you and me.  This Note and the other Loan Documents are the complete and final expression of the agreement.  If any provision of this Note is unenforceable, then the unenforceable provision will be severed and the remaining provisions will still be enforceable.  No present or future agreement securing any other debt I owe you will secure the payment of this Loan if, with respect to this loan, you fail to fulfill any necessary requirements or limitations of Sections 19(a), 32 or 35 of Regulation Z or if, as a result, this Loan would become subject to Section 670 of the John Warner National Defense Authorization Act for Fiscal Year 2007.

18.INTERPRETATION.  Whenever used, the singular includes the plural and the plural includes the singular.  The section headings are for convenience only and are not to be used to interpret or define the terms of this Note.

19.NOTICE, FINANCIAL REPORTS AND ADDITIONAL DOCUMENTS.  Unless otherwise required by law, any notice will be given by delivering it or mailing it by first class mail to the appropriate party’s address listed in the DATE AND PARTIES section, or to any other address designated in writing.  Notice to one Borrower will be deemed to be notice to all Borrowers.  I will inform you in writing of any change in my name, address or other application information.  I agree to sign, deliver, and file any additional documents or certifications that you may consider necessary to perfect, continue, and preserve my obligations under this Loan and to confirm your lien status on any Property.  Time is of the essence.

20.CREDIT INFORMATION.  I agree to supply you with whatever information you reasonably request.  You will make requests for this information without undue frequency, and will give me reasonable time in which to supply the information.

21.ERRORS AND OMISSIONS.  I agree, if requested by you, to fully cooperate in the correction, if necessary, in the reasonable discretion of you of any and all loan closing documents so that all documents accurately describe the loan between you and me.  I agree to assume all costs including by way of illustration and not limitation, actual expenses, legal fees and marketing losses for failing to reasonably comply with your requests within thirty (30) days.

22.WAIVER OF JURY TRIAL.  All of the parties to this Note knowingly and intentionally, irrevocably and unconditionally, waive any and all right to a trial by jury in any litigation arising out of or concerning this Note or any other Loan Document or related obligation.  All of these parties acknowledge that this section has either been brought to the attention of each party’s legal counsel or that each party had the opportunity to do so.

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23.SIGNATURES.  By signing, I agree to the terms contained in this Note.  I also acknowledge receipt of a copy of this Note.

BORROWER:

CTD Holdings, Inc.

By /s/ Charles E. Strattan                         

Charles E. Strattan, President

LENDER:

Sunstate Federal Credit Union

By /s/ Brian Miller        

Brian Miller, Commercial Loan Officer

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EX-10.3

Exhibit 10.3

SECURITY AGREEMENT

DATE AND PARTIES.  The date of this Security Agreement (Agreement) is March 22, 2011.  The parties and their addresses are:

SECURED PARTY:

SUNSTATE FEDERAL CREDIT UNION

408 SE 2nd Place

Gainesville, FL 32602

DEBTOR:

CTD HOLDINGS, INC.

a Florida Corporation

27317 NW 78th Avenue

High Springs, FL 32643

The pronouns “you” and “your” refer to the Secured Party.  The pronouns “I,” “me” and “my” refer to each person or entity signing this Agreement as Debtor and agreeing to give the Property described in this Agreement as security for the Secured Debts.

1.SECURED DEBTS.  The term “Secured Debts” includes and this Agreement will secure each of the following:

A.Specific Debts.  The following debts and all extensions, renewals, refinancings, modifications and replacements.  A promissory note or other agreement, No. 103428-01, dated March 22, 2011, from me to you, in the amount of $325,000.00.

B.All Debts.  All present and future debts from me to you, even if this Agreement is not specifically referenced, the future debts are also secured by other collateral, or if the future debt is unrelated to or of a different type than this debt.  If more than one person signs this Agreement, each agrees that it will secure debts incurred either individually or with others who may not sign this Agreement.  Nothing in this Agreement constitutes a commitment to make additional or future loans or advances.  Any such commitment must be in writing.

This Agreement will not secure any debt for which you fail to give any required notice of the right of rescission.  This Agreement will not secure any debt for which a non-possessory, non-purchase money security interest is created in “household goods” in connection with a “consumer loan,” as those terms are defined by federal law governing unfair and deceptive credit practices.  In addition, this Agreement will not secure any other debt if, with respect to such other debt, you fail to fulfill any necessary requirements or limitations of Sections 19(a), 32 or 35 of Regulation Z or if, as a result, the other debt would become subject to Section 670 of the John Warner National Defense Authorization Act for Fiscal Year 2007.

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C.Sums Advanced.  All sums advanced and expenses incurred by you under the terms of this Agreement.

Loan Documents refer to all the documents executed in connection with the Secured Debts.

2.SECURITY INTEREST.  To secure the payment and performance of the Secured Debts, I give you a security interest in all of the Property described in this Agreement that I own or have sufficient rights in which to transfer an interest, now or in the future, wherever the Property is or will be located, and all proceeds and products from the Property (including, but not limited to, all parts, accessories, repairs, replacements, improvements, and accessions to the Property).  Property is all the collateral given as security for the Secured Debts and described in this Agreement, and includes all obligations that support the payment or performance of the Property.  “Proceeds” includes cash proceeds, non-cash proceeds and anything acquired upon the sale, lease, license, exchange, or other disposition of the Property; any rights and claims arising from the Property; and any collections and distributions on account of the Property.

This Agreement remains in effect until terminated in writing, even if the Secured Debts are paid and you are no longer obligated to advance funds to me under any loan or credit agreement.

3.PROPERTY DESCRIPTION.  The Property is described as follows:

A.Specific Property.  SEE EXHIBIT “A” ATTACHED HERETO AND BY REFERENCE MADE A PART HEREOF.

4.WARRANTIES AND REPRESENTATIONS.  I make to you the following warranties and representations which will continue as long as this Agreement is in effect:

A.Power.  I am duly organized, and validly existing and in good standing in all jurisdictions in which I operate.  I have the power and authority to enter into this transaction and to carry on my business or activity as it is now being conducted and, as applicable, am qualified to do so in each jurisdiction in which I operate.

B.Authority.  The execution, delivery and performance of this Agreement and the obligation evidenced by this Agreement are within my powers, have been duly authorized, have received all necessary governmental approval, will not violate any provision of law, or order of court or governmental agency, and will not violate any agreement to which I am a party or to which I am or any of my property is subject.

C.Name and Location.  My name indicated in the DATE AND PARTIES section is my exact legal name.  I am an entity organized and registered under the laws of Florida.  I will provide verification of registration and location upon your request.  I will provide you with at least 30 days notice prior to any change in my name, address, or state of organization or registration.

D.Business Name.  Other than previously disclosed in writing to you I have not changed my name or principal place of business within the last 10 years and have not used any other trade or fictitious name.  Without your prior written consent, I do not and will not use any other name and will preserve my existing name, trade names and franchises.

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E.Ownership of Property.  I represent that I own all of the Property.  Your claim to the Property is ahead of the claims of any other creditor, except as disclosed in writing to you prior to any advance on the Secured Debts.  I represent that I am the original owner of the Property and, if I am not, that I have provided you with a list of prior owners of the Property.

5.DUTIES TOWARD PROPERTY.

A.Protection of Secured Party’s Interest.  I will defend the Property against any other claim.  I agree to do whatever you require to protect your security interest and to keep your claim in the Property ahead of the claims of other creditors.  I will not do anything to harm your position.

I will keep books, records and accounts about the Property and my business in general.  I will let you examine these and make copies at any reasonable time.  I will prepare any report or accounting you request which deals with the Property.

B.Use, Location, and Protection of the Property.  I will keep the Property in my possession and in good repair.  I will use it only for commercial purposes.  I will not change this specified use without your prior written consent.  You have the right of reasonable access to inspect the Property and I will immediately inform you of any loss or damage to the Property.  I will not cause or permit waste to the Property.

I will keep the Property at my address listed in the DATE AND PARTIES section unless we agree I may keep it at another location.  If the Property is to be used in other states, I will give you a list of those states.  The location of the Property is given to aid in the identification of the Property.  It does not in any way limit the scope of the security interest granted to you.  I will notify you in writing and obtain your prior written consent to any change in location of any of the Property.  I will not use the Property in violation of any law.  I will notify you in writing prior to any change in my address, name or, if an organization, any change in my identity or structure.

Until the Secured Debts are fully paid and this Agreement is terminated, I will not grant a security interest in any of the Property without your prior written consent.  I will pay all taxes and assessments levied or assessed against me or the Property and provide timely proof of payment of these taxes and assessments upon request.

C.Selling, Leasing or Encumbering the Property.  I will not sell, offer to sell, lease, or otherwise transfer or encumber the Property without your prior written permission.  Any disposition of the Property contrary to this Agreement will violate your rights.  Your permission to sell the Property may be reasonably withheld without regard to the creditworthiness of any buyer or transferee.  I will not permit the Property to be the subject of any court order affecting my rights to the Property in any action by anyone other than you.  If the Property includes chattel paper or instruments, either as original collateral or as proceeds of the Property, I will note your security interest on the face of the chattel paper or instruments.

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6.AUTHORITY TO PERFORM.  I authorize you to do anything you deem reasonably necessary to protect the Property, and perfect and continue your security interest in the Property.  If I fail to perform any of my duties under this Agreement or any other Loan Document, you are authorized, without notice to me, to perform the duties or cause them to be performed.

These authorizations include, but are not limited to, permission to:

A.pay and discharge taxes, liens, security interests or other encumbrances at any time levied or placed on the Property.

B.pay any rents or other charges under any lease affecting the Property.

C.order and pay for the repair, maintenance and preservation of the Property.

D.file any financing statements on my behalf and pay for filing and recording fees pertaining to the Property.

E.place a note on any chattel paper indicating your interest in the Property.

F.take any action you feel necessary to realize on the Property, including performing any part of a contract or endorsing it in my name.

G.handle any suits or other proceedings involving the Property in my name.

H.prepare, file, and sign my name to any necessary reports or accountings.

I.make an entry on my books and records showing the existence of this Agreement.

If you perform for me, you will use reasonable care.  If you exercise the care and follow the procedures that you generally apply to the collection of obligations owed to you, you will be deemed to be using reasonable care.  Reasonable care will not include:  any steps necessary to preserve rights against prior parties; the duty to send notices, perform services or take any other action in connection with the management of the Property; or the duty to protect, preserve or maintain any security interest given to others by me or other parties.  Your authorization to perform for me will not create an obligation to perform and your failure to perform will not preclude you from exercising any other rights under the law or this Agreement.  All cash and non-cash proceeds of the Property may be applied by you only upon your actual receipt of cash proceeds against such of the Secured Debts, matured or unmatured, as you determine in your sole discretion.

If you come into actual or constructive possession of the Property, you will preserve and protect the Property.  For purposes of this paragraph, you will be in actual possession of the Property only when you have physical, immediate and exclusive control over the Property and you have affirmatively accepted that control.  You will be in constructive possession of the Property only when you have both the power and the intent to exercise control over the Property.

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7.DEFAULT.  I will be in default if any of the following events (known separately and collectively as an Event of Default) occur:

A.Payments.  I fail to make a payment in full when due.

B.Insolvency or Bankruptcy.  The death, dissolution or insolvency of, appointment of a receiver by or on behalf of, application of any debtor relief law, the assignment for the benefit of creditors by or on behalf of, the voluntary or involuntary termination of existence by, or the commencement of any proceeding under any present or future federal or state insolvency, bankruptcy, reorganization, composition or debtor relief law by or against me, Obligor, or any co­signer, endorser, surety or guarantor of this Agreement or any other obligations Obligor has with you.

C.Business Termination.  I merge, dissolve, reorganize, end my business or existence, or a partner or majority owner dies or is declared legally incompetent.

D.Failure to Perform.  I fail to perform any condition or to keep any promise or covenant of this Agreement.

E.Other Documents.  A default occurs under the terms of any other Loan Document.

F.Other Agreements.  I am in default on any other debt or agreement I have with you.

G.Misrepresentation.  I make any verbal or written statement or provide any financial information that is untrue, inaccurate, or conceals a material fact at the time it is made or provided.

H.Judgment.  I fail to satisfy or appeal any judgment against me.

I.Forfeiture.  The Property is used in a manner or for a purpose that threatens confiscation by a legal authority.

J.Name Change.  I change my name or assume an additional name without notifying you before making such a change.

K.Property Transfer.  I transfer all or a substantial part of my money or property.

L.Property Value.  You determine in good faith that the value of the Property has declined or is impaired.

M.Material Change.  Without first notifying you, there is a material change in my business, including ownership, management, and financial conditions.

N.Insecurity.  You determine in good faith that a material adverse change has occurred in my financial condition from the conditions set forth in my most recent financial statement before the date of this Agreement or that the prospect for payment or performance of the Secured Debts is impaired for any reason.

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8.DUE ON SALE OR ENCUMBRANCE.  You may, at your option, declare the entire balance of this Agreement to be immediately due and payable upon the creation of, or contract for the creation of, any lien, encumbrance, transfer or sale of all or any part of the Property.  This right is subject to the restrictions imposed by federal law (12 C.F.R. 591), as applicable.

9.REMEDIES.  After I default, you may at your option do any one or more of the following.

A.Acceleration.  You may make all or any part of the amount owing by the terms of the Secured Debts immediately due.

B.Sources.  You may use any and all remedies you have under state or federal law or in any Loan Document.

C.Insurance Benefits.  You may make a claim for any and all insurance benefits or refunds that may be available on my default.

D.Payments Made On My Behalf.  Amounts advanced on my behalf will be immediately due and may be added to the Secured Debts.

E.Assembly of Property.  You may require me to gather the Property and make it available to you in a reasonable fashion.

F.Repossession.  You may repossess the Property so long as the repossession does not involve a breach of the peace.  You may sell, lease or otherwise dispose of the Property as provided by law.  You may apply what you receive from the disposition of the Property to your expenses, your attorneys’ fees and legal expenses (where not prohibited by law), and any debt I owe you.  If what you receive from the disposition of the Property does not satisfy the debt, I will be liable for the deficiency (where permitted by law).  In some cases, you may keep the Property to satisfy the debt.

Where a notice is required, I agree that ten days prior written notice sent by first class mail to my address listed in this Agreement will be reasonable notice to me under the Florida Uniform Commercial Code.  If the Property is perishable or threatens to decline speedily in value, you may, without notice to me, dispose of any or all of the Property in a commercially reasonable manner at my expense following any commercially reasonable preparation or processing.

If any items not otherwise subject to this Agreement are contained in the Property when you take possession, you may hold these items for me at my risk and you will not be liable for taking possession of them.

G.Use and Operation.  You may enter upon my premises and take possession of all or any part of my property for the purpose of preserving the Property or its value, so long as you do not breach the peace.  You may use and operate my property for the length of time you feel is necessary to protect your interest, all without payment or compensation to me.

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H.Waiver.  By choosing any one or more of these remedies you do not give up your right to use any other remedy.  You do not waive a default if you choose not to use a remedy.  By electing not to use any remedy, you do not waive your right to later consider the event a default and to use any remedies if the default continues or occurs again.

10.WAIVER OF CLAIMS.  I waive all claims for loss or damage caused by your acts or omissions where you acted reasonably and in good faith.

11.ADDITIONAL TERMS.  THE OCCURRENCE OF ANY DEFAULT OF THE BORROWER(S) IN PAYMENT OF THIS PROMISSORY NOTE SHALL ALSO CONSTITUTE AN EVENT OF DEFAULT WITH RESPECT TO THE INDEBTEDNESS OF THE BORROWER(S) EVIDENCED BY THAT CERTAIN PROMISSORY NOTE NUMBER 103428-02 DATED MARCH 22, 2011, EXECUTED BY CTD HOLDINGS, INC., IN THE ORIGINAL PRINCIPAL AMOUNT OF $100,000.00, TOGETHER WITH ANY AND ALL EXTENSIONS, RENEWALS, MODIFICATIONS, SUBSTITUTIONS, REPLACEMENTS, AND CHANGES IN FORM THEREOF, WHICH MAY FROM TIME TO TIME AND FOR ANY TERM OR TERMS ARE EFFECTED BY AN AGREEMENT BETWEEN BORROWER(S) AND THE LENDER.

12.PERFECTION OF SECURITY INTEREST AND COSTS.  I authorize you to file a financing statement and/or security agreement, as appropriate, covering the Property.  I will comply with, facilitate, and otherwise assist you in connection with obtaining perfection or control over the Property for purposes of perfecting your security interest under the Uniform Commercial Code.  I agree to pay all taxes, fees and costs you pay or incur in connection with preparing, filing or recording any financing statements or other security interest filings on the Property.  I agree to pay all actual costs of terminating your security interest.

13.APPLICABLE LAW.  This Agreement is governed by the laws of Florida, the United States of America, and to the extent required, by the laws of the jurisdiction where the Property is located, except to the extent such state laws are preempted by federal law.  In the event of a dispute, the exclusive forum, venue and place of jurisdiction will be in Florida, unless otherwise required by law.

14.JOINT AND INDIVIDUAL LIABILITY AND SUCCESSORS.  Each Debtor’s obligations under this Agreement are independent of the obligations of any other Debtor.  You may sue each Debtor individually or together with any other Debtor.  You may release any part of the Property and I will still be obligated under this Agreement for the remaining Property.  Debtor agrees that you and any party to this Agreement may extend, modify or make any change in the terms of this Agreement or any evidence of debt without Debtor’s consent.  Such a change will not release Debtor from the terms of this Agreement.  If you assign any of the Secured Debts, you may assign all or any part of this Agreement without notice to me or my consent, and this Agreement will inure to the benefit of your assignee to the extent of such assignment.  You will continue to have the unimpaired right to enforce this Agreement as to any of the Secured Debts that are not assigned.  This Agreement shall inure to the benefit of and be enforceable by you and your successors and assigns and any other person to whom you may grant an interest in the Secured Debts and shall be binding upon and enforceable against me and my personal representatives, successors, heirs and assigns.

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15.AMENDMENT, INTEGRATION AND SEVERABILITY.  This Agreement may not be amended or modified by oral agreement.  No amendment or modification of this Agreement is effective unless made in writing and executed by you and me.  This Agreement and the other Loan Documents are the complete and final expression of the understanding between you and me.  If any provision of this Agreement is unenforceable, then the unenforceable provision will be severed and the remaining provisions will still be enforceable.

16.INTERPRETATION.  Whenever used, the singular includes the plural and the plural includes the singular.  The section headings are for convenience only and are not to be used to interpret or define the terms of this Agreement.

17.NOTICE, FINANCIAL REPORTS AND ADDITIONAL DOCUMENTS.  Unless otherwise required by law, any notice will be given by delivering it or mailing it by first class mail to the appropriate party’s address listed in the DATE AND PARTIES section, or to any other address designated in writing.  Notice to one Debtor will be deemed to be notice to all Debtors.  I will inform you in writing of any change in my name, address or other application information.  I will provide you any financial statement or information you request.  All financial statements and information I give you will be correct and complete.  I agree to sign, deliver, and file any additional documents or certifications that you may consider necessary to perfect, continue, and preserve my obligations under this Agreement and to confirm your lien status on any Property.  Time is of the essence.

18.WAIVER OF JURY TRIAL.  All of the parties to this Agreement knowingly and intentionally, irrevocably and unconditionally, waive any and all right to a trial by jury in any litigation arising out of or concerning this Agreement or any other Loan Document or related obligation.  All of these parties acknowledge that this section has either been brought to the attention of each party’s legal counsel or that each party had the opportunity to do so.

19.SIGNATURES.  By signing, I agree to the terms contained in this Agreement.  I also acknowledge receipt of a copy of this Agreement.

DEBTOR:

CTD Holdings, Inc.

By  /s/ Charles E. Strattan                 

Charles E. Strattan, President

SECURED PARTY:

Sunstate Federal Credit Union

By  /s/ Brian Miller      

Brian Miller, Commercial Loan Officer

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EXHIBIT “A”

All personal property, rights and interest listed below together with any other property, rights or interest listed in any mortgage from the Debtor to the Secured Party encumbering the property described in “Exhibit A” (the “Property”) including, but not limited to, the following:

1.All buildings and improvements of every kind and description now or hereafter erected or placed on the Property and all materials intended for construction, reconstruction, alteration and repair of such improvements now or hereafter erected thereon; all fixtures and equipment now or hereafter owned by Debtor and attached to or contained in and used in connection with the Property, including but not limited to all apparatus, machinery, motors, elevators, fittings, radiators, gas ranges, mechanical refrigerators, awnings, shades screens, Venetian blinds, all plumbing, heating, lighting, cooking, laundry, ventilating, refrigerating, incinerating, air-conditioning, hot water heating and sprinkler equipment and fixtures and appurtenances thereto; all built-in equipment and built-in furniture; and all renewals or replacements thereof or articles in substitution therefore, whether or not the same are or shall be attached to the Property or building or buildings in any manner.

2.All right, title and interest of Debtor in and to the minerals, soil, flowers, shrubs, crops, trees, timber and other emblements now or hereafter on the Property or under or above the same or any part or parcel thereof.

3.All contracts and contract rights and accounts of Debtor now or hereafter arising from contracts now or hereafter entered into in connection with the development, construction upon or operation of the Property (including, without limitation, all deposits held by or on behalf of the Debtor, and all management, franchise, and service agreements related to the business now or hereafter conducted by the Debtor on the Property).

4.All of Debtor’s interest in all utility security deposits or bonds on the Property or any part or parcel thereof.

5.All property and hazard insurance covering the above Property and collateral, together with any and all extensions and replacements thereof, and any and all rights thereunder; and any and all rights of subrogation provided by any mortgage from the Debtor to Secured Party covering the Property.

6.Any monies in any escrow accounts established or accrued pursuant to any mortgage from the Debtor to the Secured Party.

7.Any damages awarded pursuant to condemnation or eminent domain proceedings with respect to the Property.

8.All of Debtor’s right, title and interest as lessor in and to all leases or rental arrangements of the Property, or any part thereof, heretofore made and entered into, and in and to all leases or rental arrangements hereafter made and entered into by or on behalf of Debtor, together with all rents and payments in lieu of rents, together with any and all guarantees of such leases or rental arrangements and including all present and future security deposits and advance rentals.

9.All of Debtor’s right, title and interest as seller in and to all agreements for the sale of the Property, or any part thereof, heretofore made and entered into, and in and to all sale agreements hereafter made and entered into, by or on behalf of Debtor, together with all deposits and payments in connection therewith.

The Property includes, but is not limited to, the following real property:

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LEGAL DESCRIPTION

THE NW 1/4 OF THE SE 1/4 OF SECTION 8, TOWNSHIP 9 SOUTH, RANGE 17 EAST, ALACHUA COUNTY, FLORIDA.

TOGETHER WITH ROAD RIGHT-OF-WAY EASEMENT OVER THE WEST 30.00 FEET OF THE NE 1/4 OF SECTION 8, TOWNSHIP 9 SOUTH, RANGE 17 EAST, ALACHUA COUNTY, FLORIDA, AS PER O.R. BOOK 1977, PAGE 476, PUBLIC RECORDS OF ALACHUA COUNTY, FLORIDA.

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EX-10.4

Exhibit 10.4

THIS IS A BALLOON MORTGAGE AND THE FINAL PRINCIPAL PAYMENT OR THE PRINCIPAL DUE UPON MATURITY IS APPROXIMATELY $250,918.91, TOGETHER WITH ACCRUED INTEREST, IF ANY, AND ALL ADVANCES MADE BY THE MORTGAGEE UNDER THE TERMS OF THIS MORTGAGE.

Return to:  Sunstate Federal Credit Union, 405 SE 2nd Place, Gainesville, FL 32402

This document was prepared by: Member Business Solutions, LLC, 3692 Coolidge Court, #200, Tallahassee, FL 32311-7890

State of Florida’s Documentary Stamp Tax required by law in the amount of $1,137.50 has been paid to the Clerk of the Circuit Court (or the County Comptroller, if applicable) for the County of Alachua, State of Florida.

Space Above This Line For Recording Data

MORTGAGE

DATE AND PARTIES.  The date of this Mortgage (Security Instrument) is March 22, 2011.  The parties and their addresses are:

MORTGAGOR:

CTD HOLDINGS, INC.

A Florida Corporation

f/k/a Cyclodextrin Technologies Development, Inc.

27317 NW 78th Avenue

High Springs, FL 32643

LENDER:

SUNSTATE FEDERAL CREDIT UNION

Organized and existing under the laws of Florida

405 SE 2nd Place

Gainesville, FL 32602

1.CONVEYANCE.  For good and valuable consideration, the receipt and sufficiency of which is acknowledged, and to secure the Secured Debts and Mortgagor’s performance under this Security Instrument, Mortgagor does hereby grant, bargain, convey and mortgage to Lender, the following described property:

THE NW 1/4 OF THE SE 1/4 OF SECTION 8, TOWNSHIP 9 SOUTH, RANGE 17 EAST, ALACHUA COUNTY, FLORIDA.

TOGETHER WITH ROAD RIGHT-OF-WAY EASEMENT OVER THE WEST 30.00 FEET OF THE NE 1/4 OF SECTION 8, TOWNSHIP 9 SOUTH, RANGE 17 EAST, ALACHUA COUNTY, FLORIDA, AS PER O.R. BOOK 1977, PAGE 476, PUBLIC RECORDS OF ALACHUA COUNTY, FLORIDA.

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The property is located in Alachua County at 27317 NW 78th Avenue, High Springs, Florida 32643.

Together with all rights, easements, appurtenances, royalties, mineral rights, oil and gas rights, all water and riparian rights, wells, ditches and water stock, crops, timber, all diversion payments or third party payments made to crop producers and all existing and future improvements, structures, fixtures, and replacements that may now, or at any time in the future, be part of the real estate described (all referred to as Property).  This Security Instrument will remain in effect until the Secured Debts and all underlying agreements have been terminated in writing by Lender.

2.SECURED DEBTS.  The term “Secured Debts” includes and this Security Instrument will secure each of the following:

A.Specific Debts.  The following debts and all extensions, renewals, refinancings, modifications and replacements.  A promissory note or other agreement, No. 103428-01, dated March 22, 2011, from Mortgagor to Lender, with a loan amount of $325,000.00 and maturing on March 22, 2016.

B.All Debts.  All present and future debts made within 20 years from the date of this Security Instrument from Mortgagor to Lender, even if this Security Instrument is not specifically referenced, or if the future debt is unrelated to or of a different type than this debt.  If more than one person signs this Security Instrument, each agrees that it will secure debts incurred either individually or with others who may not sign this Security Instrument.  Nothing in this Security Instrument constitutes a commitment to make additional or future loans or advances.  Any such commitment must be in writing.  In the event that Lender fails to provide any required notice of the right of rescission, Lender waives any subsequent security interest in the Mortgagor’s principal dwelling that is created by this Security Instrument.  This Security Instrument will not secure any debt for which a non-possessory, non-purchase money security interest is created in “household goods” in connection with a “consumer loan,” as those terms are defined by federal law governing unfair and deceptive credit practices.  This Security Instrument will not secure any debt for which a security interest is created in “margin stock” and Lender does not obtain a “statement of purpose,” as defined and required by federal law governing securities.  This Security Instrument will not secure any other debt if Lender fails, with respect to that other debt, to fulfill any necessary requirements or limitations of Sections 19(a), 32, or 35 of Regulation Z.

C.Sums Advanced.  All sums advanced and expenses incurred by Lender under the terms of this Security Instrument.

3.MAXIMUM OBLIGATION LIMIT.  The total principal amount secured by this Security Instrument at any one time and from time to time will not exceed $325,000.00.  Any limitation of amount does not include interest and other fees and charges validly made pursuant to this Security Instrument.  Also, this limitation does not apply to advances made under the terms of this Security Instrument to protect Lender’s security and to perform any of the covenants contained in this Security Instrument.

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4.PAYMENTS.  Mortgagor agrees that all payments under the Secured Debts will be paid when due and in accordance with the terms of the Secured Debts and this Security Instrument.

5.WARRANTY OF TITLE.  Mortgagor warrants that Mortgagor is or will be lawfully seized of the estate conveyed by this Security Instrument and has the right to grant, bargain, convey, sell and mortgage the Property.  Mortgagor also warrants that the Property is unencumbered, except for encumbrances of record.

6.PRIOR SECURITY INTERESTS.  With regard to any other mortgage, deed of trust, security agreement or other lien document that created a prior security interest or encumbrance on the Property, Mortgagor agrees:

A.To make all payments when due and to perform or comply with all covenants.

B.To promptly deliver to Lender any notices that Mortgagor receives from the holder.

C.Not to allow any modification or extension of, nor to request any future advances under any note or agreement secured by the lien document without Lender’s prior written consent.

7.CLAIMS AGAINST TITLE.  Mortgagor will pay all taxes, assessments, liens, encumbrances, lease payments, ground rents, utilities, and other charges relating to the Property when due.  Lender may require Mortgagor to provide to Lender copies of all notices that such amounts are due and the receipts evidencing Mortgagor’s payment.  Mortgagor will defend title to the Property against any claims that would impair the lien of this Security Instrument.  Mortgagor agrees to assign to Lender, as requested by Lender, any rights, claims or defenses Mortgagor may have against parties who supply labor or materials to maintain or improve the Property.

8.DUE ON SALE OR ENCUMBRANCE.  Lender may, at its option, declare the entire balance of the Secured Debt to be immediately due and payable upon the creation of, or contract for the creation of, any lien, encumbrance, transfer or sale of all or any part of the Property.  This right is subject to the restrictions imposed by federal law (12 C.F.R. 591), as applicable.

9.TRANSFER OF AN INTEREST IN THE MORTGAGOR.  If Mortgagor is an entity other than a natural person (such as a corporation, partnership, limited liability company or other organization), Lender may demand immediate payment if:

A.A beneficial interest in Mortgagor is sold or transferred.

B.There is a change in either the identity or number of members of a partnership or similar entity.

C.There is a change in ownership of more than 25 percent of the voting stock of a corporation, partnership, limited liability company or similar entity.

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However, Lender may not demand payment in the above situations if it is prohibited by law as of the date of this Security Instrument.

10.WARRANTIES AND REPRESENTATIONS.  Mortgagor makes to Lender the following warranties and representations which will continue as long as this Security Instrument is in effect:

A.Power.  Mortgagor is duly organized, and validly existing and in good standing in all jurisdictions in which Mortgagor operates.  Mortgagor has the power and authority to enter into this transaction and to carry on Mortgagor’s business or activity as it is now being conducted and, as applicable, is qualified to do so in each jurisdiction in which Mortgagor operates.

B.Authority.  The execution, delivery and performance of this Security Instrument and the obligation evidenced by this Security Instrument are within Mortgagor’s powers, have been duly authorized, have received all necessary governmental approval, will not violate any provision of law, or order of court or governmental agency, and will not violate any agreement to which Mortgagor is a party or to which Mortgagor is or any of Mortgagor’s property is subject.

C.Name and Place of Business.  Other than previously disclosed in writing to Lender, Mortgagor has not changed Mortgagor’s name or principal place of business within the last 10 years and has not used any other trade or fictitious name.  Without Lender’s prior written consent, Mortgagor does not and will not use any other name and will preserve Mortgagor’s existing name, trade names and franchises.

11.PROPERTY CONDITION, ALTERATIONS AND INSPECTION.  Mortgagor will keep the Property in good condition and make all repairs that are reasonably necessary.  Mortgagor will not commit or allow any waste, impairment, or deterioration of the Property.  Mortgagor will keep the Property free of noxious weeds and grasses.  Mortgagor agrees that the nature of the occupancy and use will not substantially change without Lender’s prior written consent.  Mortgagor will not permit any change in any license, restrictive covenant or easement without Lender’s prior written consent.  Mortgagor will notify Lender of all demands, proceedings, claims, and actions against Mortgagor, and of any loss or damage to the Property.

No portion of the Property will be removed, demolished or materially altered without Lender’s prior written consent except that Mortgagor has the right to remove items of personal property comprising a part of the Property that become worn or obsolete, provided that such personal property is replaced with other personal property at least equal in value to the replaced personal property, free from any title retention device, security agreement or other encumbrance.  Such replacement of personal property will be deemed subject to the security interest created by this Security Instrument.  Mortgagor will not partition or subdivide the Property without Lender’s prior written consent.

Lender or Lender’s agents may, at Lender’s option, enter the Property at any reasonable time for the purpose of inspecting the Property.  Lender will give Mortgagor notice at the time of or before an inspection specifying a reasonable purpose for the inspection.  Any inspection of the Property will be entirely for Lender’s benefit and Mortgagor will in no way rely on Lender’s inspection.

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12.AUTHORITY TO PERFORM.  If Mortgagor fails to perform any duty or any of the covenants contained in this Security Instrument, Lender may, without notice, perform or cause them to be performed.  Mortgagor appoints Lender as attorney in fact to sign Mortgagor’s name or pay any amount necessary for performance.  Lender’s right to perform for Mortgagor will not create an obligation to perform, and Lender’s failure to perform will not preclude Lender from exercising any of Lender’s other rights under the law or this Security Instrument.  If any construction on the Property is discontinued or not carried on in a reasonable manner, Lender may take all steps necessary to protect Lender’s security interest in the Property, including completion of the construction.

13.DEFAULT.  Mortgagor will be in default if any of the following events (known separately and collectively as an Event of Default) occur:

A.Payments.  Mortgagor fails to make a payment in full when due.

B.Insolvency or Bankruptcy.  The death, dissolution or insolvency of, appointment of a receiver by or on behalf of, application of any debtor relief law, the assignment for the benefit of creditors by or on behalf of, the voluntary or involuntary termination of existence by, or the commencement of any proceeding under any present or future federal or state insolvency, bankruptcy, reorganization, composition or debtor relief law by or against Mortgagor, Borrower, or any co-signer, endorser, surety or guarantor of this Security Instrument or any other obligations Borrower has with Lender.

C.Business Termination.  Mortgagor merges, dissolves, reorganizes, ends its business or existence, or a partner or majority owner dies or is declared legally incompetent.

D.Failure to Perform.  Mortgagor fails to perform any condition or to keep any promise or covenant of this Security Instrument.

E.Other Documents.  A default occurs under the terms of any other document relating to the Secured Debts.

F.Other Agreements.  Mortgagor is in default on any other debt or agreement Mortgagor has with Lender.

G.Misrepresentation.  Mortgagor makes any verbal or written statement or provides any financial information that is untrue, inaccurate, or conceals a material fact at the time it is made or provided.

H.Judgment.  Mortgagor fails to satisfy or appeal any judgment against Mortgagor.

I.Forfeiture.  The Property is used in a manner or for a purpose that threatens confiscation by a legal authority.

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J.Name Change.  Mortgagor changes Mortgagor’s name or assumes an additional name without notifying Lender before making such a change.

K.Property Transfer.  Mortgagor transfers all or a substantial part of Mortgagor’s money or property.  This condition of default, as it relates to the transfer of the Property, is subject to the restrictions contained in the DUE ON SALE section.

L.Property Value.  Lender determines in good faith that the value of the Property has declined or is impaired.

M.Material Change.  Without first notifying Lender, there is a material change in Mortgagor’s business, including ownership, management, and financial conditions.

N.Insecurity.  Lender determines in good faith that a material adverse change has occurred in Mortgagor’s financial condition from the conditions set forth in Mortgagor’s most recent financial statement before the date of this Security Instrument or that the prospect for payment or performance of the Secured Debts is impaired for any reason.

14.REMEDIES.  On or after the occurrence of an Event of Default, Lender may use any and all remedies Lender has under state or federal law or in any document relating to the Secured Debts.  Any amounts advanced on Mortgagor’s behalf will be immediately due and may be added to the balance owing under the Secured Debts.  Lender may make a claim for any and all insurance benefits or refunds that may be available on Mortgagor’s default.

Subject to any right to cure, required time schedules or any other notice rights Mortgagor may have under federal and state law, Lender may make all or any part of the amount owing by the terms of the Secured Debts immediately due and foreclose this Security Instrument in a manner provided by law upon the occurrence of an Event of Default or anytime thereafter.

All remedies are distinct, cumulative and not exclusive, and Lender is entitled to all remedies provided at law or equity, whether or not expressly set forth.  The acceptance by Lender of any sum in payment or partial payment on the Secured Debts after the balance is due or is accelerated or after foreclosure proceedings are filed will not constitute a waiver of Lender’s right to require full and complete cure of any existing default.  By not exercising any remedy, Lender does not waive Lender’s right to later consider the event a default if it continues or happens again.

15.COLLECTION EXPENSES AND ATTORNEYS’ FEES.  On or after the occurrence of an Event of Default, to the extent permitted by law, Mortgagor agrees to pay all expenses of collection, enforcement or protection of Lender’s rights and remedies under this Security Instrument or any other document relating to the Secured Debts.  Mortgagor agrees to pay expenses for Lender to inspect and preserve the Property and for any recordation costs of releasing the Property from this Security Instrument.  Expenses include, but are not limited to, attorneys’ fees of 10 percent of the Principal sum due or a larger amount as the court judges as reasonable and just, court costs and other legal expenses.  These expenses are due and payable immediately.  If not paid immediately, these expenses will bear interest from the date of payment until paid in full at the highest interest rate in effect as provided for in the terms of the Secured Debts.  In addition, to the extent permitted by the United States Bankruptcy Code, Mortgagor agrees to pay the reasonable attorneys’ fees incurred by Lender to protect Lender’s rights and interests in connection with any bankruptcy proceedings initiated by or against Mortgagor.

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16.WAIVER OF JURY TRIAL.  All of the parties to this Security Instrument knowingly and intentionally, irrevocably and unconditionally, waive any and all right to a trial by jury in any litigation arising out of or concerning this Security Instrument or any other documents relating to the Secured Debts or related obligation.  All of these parties acknowledge that this section has either been brought to the attention of each party’s legal counsel or that each party had the opportunity to do so.

17.ENVIRONMENTAL LAWS AND HAZARDOUS SUBSTANCES.  As used in this section, (1) Environmental Law means, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA, 42 U.S.C. 9601 et seq.), all other federal, state and local laws, regulations, ordinances, court orders, attorney general opinions or interpretive letters concerning the public health, safety, welfare, environment or a hazardous substance; and (2) Hazardous Substance means any toxic, radioactive or hazardous material, waste, pollutant or contaminant which has characteristics which render the substance dangerous or potentially dangerous to the public health, safety, welfare or environment.  The term includes, without limitation, any substances defined as “hazardous material,” “toxic substance,” “hazardous waste,” “hazardous substance,” or “regulated substance” under any Environmental Law.

Mortgagor represents, warrants and agrees that:

A.Except as previously disclosed and acknowledged in writing to Lender, no Hazardous Substance has been, is, or will be located, transported, manufactured, treated, refined, or handled by any person on, under or about the Property, except in the ordinary course of business and in strict compliance with all applicable Environmental Law.

B.Except as previously disclosed and acknowledged in writing to Lender, Mortgagor has not and will not cause, contribute to, or permit the release of any Hazardous Substance on the Property.

C.Mortgagor will immediately notify Lender if (1) a release or threatened release of Hazardous Substance occurs on, under or about the Property or migrates or threatens to migrate from nearby property; or (2) there is a violation of any Environmental Law concerning the Property.  In such an event, Mortgagor will take all necessary remedial action in accordance with Environmental Law.

D.Except as previously disclosed and acknowledged in writing to Lender, Mortgagor has no knowledge of or reason to believe there is any pending or threatened investigation, claim, or proceeding of any kind relating to (1) any Hazardous Substance located on, under or about the Property; or (2) any violation by Mortgagor or any tenant of any Environmental Law.  Mortgagor will immediately notify Lender in writing as soon as Mortgagor has reason to believe there is any such pending or threatened investigation, claim, or proceeding.  In such an event, Lender has the right, but not the obligation, to participate in any such proceeding including the right to receive copies of any documents relating to such proceedings.

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E.Except as previously disclosed and acknowledged in writing to Lender, Mortgagor and every tenant have been, are and will remain in full compliance with any applicable Environmental Law.

F.Except as previously disclosed and acknowledged in writing to Lender, there are no underground storage tanks, private dumps or open wells located on or under the Property and no such tank, dump or well will be added unless Lender first consents in writing.

G.Mortgagor will regularly inspect the Property, monitor the activities and operations on the Property, and confirm that all permits, licenses or approvals required by any applicable Environmental Law are obtained and complied with.

H.Mortgagor will permit, or cause any tenant to permit, Lender or Lender’s agent to enter and inspect the Property and review all records at any reasonable time to determine (1) the existence, location and nature of any Hazardous Substance on, under or about the Property; (2) the existence, location, nature, and magnitude of any Hazardous Substance that has been released on, under or about the Property; or (3) whether or not Mortgagor and any tenant are in compliance with applicable Environmental Law.

I.Upon Lender’s request and at any time, Mortgagor agrees, at Mortgagor’s expense, to engage a qualified environmental engineer to prepare an environmental audit of the Property and to submit the results of such audit to Lender.  The choice of the environmental engineer who will perform such audit is subject to Lender’s approval.

J.Lender has the right, but not the obligation, to perform any of Mortgagor’s obligations under this section at Mortgagor’s expense.

K.As a consequence of any breach of any representation, warranty or promise made in this section, (1) Mortgagor will indemnify and hold Lender and Lender’s successors or assigns harmless from and against all losses, claims, demands, liabilities, damages, cleanup, response and remediation costs, penalties and expenses, including without limitation all costs of litigation and attorneys’ fees, which Lender and Lender’s successors or assigns may sustain; and (2) at Lender’s discretion, Lender may release this Security Instrument and in return Mortgagor will provide Lender with collateral of at least equal value to the Property without prejudice to any of Lender’s rights under this Security Instrument.

L.Notwithstanding any of the language contained in this Security Instrument to the contrary, the terms of this section will survive any foreclosure or satisfaction of this Security Instrument regardless of any passage of title to Lender or any disposition by Lender of any or all of the Property.  Any claims and defenses to the contrary are hereby waived.

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18.CONDEMNATION.  Mortgagor will give Lender prompt notice of any pending or threatened action by private or public entities to purchase or take any or all of the Property through condemnation, eminent domain, or any other means.  Mortgagor authorizes Lender to intervene in Mortgagor’s name in any of the above described actions or claims.  Mortgagor assigns to Lender the proceeds of any award or claim for damages connected with a condemnation or other taking of all or any part of the Property.  Such proceeds will be considered payments and will be applied as provided in this Security Instrument.  This assignment of proceeds is subject to the terms of any prior mortgage, deed of trust, security agreement or other lien document.

19.INSURANCE.  Mortgagor agrees to keep the Property insured against the risks reasonably associated with the Property.  Mortgagor will maintain this insurance in the amounts Lender requires.  This insurance will last until the Property is released from this Security Instrument.  What Lender requires pursuant to the preceding two sentences can change during the term of the Secured Debts.  Mortgagor may choose the insurance company, subject to Lender’s approval, which will not be unreasonably withheld.

All insurance policies and renewals shall include a standard “mortgage clause” (or “lender loss payable clause”) endorsement that names Lender as “mortgagee” and “loss payee”.  If required by Lender, all insurance policies and renewals will also include an “additional insured” endorsement that names Lender as an “additional insured”.  If required by Lender, Mortgagor agrees to maintain comprehensive general liability insurance and rental loss or business interruption insurance in amounts and under policies acceptable to Lender.  The comprehensive general liability insurance must name Lender as an additional insured.  The rental loss or business interruption insurance must be in an amount equal to at least coverage of one year’s debt service, and required escrow account deposits (if agreed to separately in writing).

Mortgagor will give Lender and the insurance company immediate notice of any loss.  All insurance proceeds will be applied to restoration or repair of the Property or to the Secured Debts, at Lender’s option.  If Lender acquires the Property in damaged condition, Mortgagor’s rights to any insurance policies and proceeds will pass to Lender to the extent of the Secured Debts.

Mortgagor will immediately notify Lender of cancellation or termination of insurance.  If Mortgagor fails to keep the Property insured, Lender may obtain insurance to protect Lender’s interest in the Property and Mortgagor will pay for the insurance on Lender’s demand.  Lender may demand that Mortgagor pay for the insurance all at once, or Lender may add the insurance premiums to the balance of the Secured Debts and charge interest on it at the rate that applies to the Secured Debts.  This insurance may include coverages not originally required of Mortgagor, may be written by a company other than one Mortgagor would choose, and may be written at a higher rate than Mortgagor could obtain if Mortgagor purchased the insurance.  Mortgagor acknowledges and agrees that Lender or one of Lender’s affiliates may receive commissions on the purchase of this insurance.

20.ESCROW FOR TAXES AND INSURANCE.  Mortgagor will not be required to pay to Lender funds for taxes and insurance in escrow, at this time.

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21.CO-SIGNERS.  If Mortgagor signs this Security Instrument but is not otherwise obligated to pay the Secured Debts, Mortgagor does so only to mortgage Mortgagor’s interest in the Property to secure payment of the Secured Debts and Mortgagor does not agree by signing this Security Instrument to be personally liable on the Secured Debts.  If this Security Instrument secures a guaranty between Lender and Mortgagor, Mortgagor agrees to waive any rights that may prevent Lender from bringing any action or claim against Mortgagor or any party indebted under the obligation.  These rights may include, but are not limited to, any anti-deficiency or one-action laws.

22.WAIVERS.  Except to the extent prohibited by law, Mortgagor waives all appraisement and homestead exemption rights relating to the Property.

23.FIXTURE FILING.  Mortgagor gives to Lender a security interest in all goods that Mortgagor owns now or in the future and that are or will become fixtures related to the Property.

24.OTHER TERMS.  The following are applicable to this Security Instrument:

A.No Action by Lender.  Nothing contained in this Security Instrument shall require Lender to take any action.

B.Additional Terms.  THE OCCURRENCE OF ANY DEFAULT OF THE BORROWER(S) IN PAYMENT OF THIS PROMISSORY NOTE SHALL ALSO CONSTITUTE AN EVENT OF DEFAULT WITH RESPECT TO THE INDEBTEDNESS OF THE BORROWER(S) EVIDENCED BY THAT CERTAIN PROMISSORY NOTE NUMBER 103428-01 DATED MARCH 22, 2011, EXECUTED BY CTD HOLDINGS, INC., IN THE ORIGINAL PRINCIPAL AMOUNT OF $100,000.00, TOGETHER WITH ANY AND ALL EXTENSIONS, RENEWALS, MODIFICATIONS, SUBSTITUTIONS, REPLACEMENTS, AND CHANGES IN FORM THEREOF, WHICH MAY FROM TIME TO TIME AND FOR ANY TERM OR TERMS ARE EFFECTED BY AN AGREEMENT BETWEEN BORROWER(S) AND THE LENDER.

25.APPLICABLE LAW.  This Security Instrument is governed by the laws of Florida, the United States of America, and to the extent required, by the laws of the jurisdiction where the Property is located, except to the extent such state laws are preempted by federal law.

26.JOINT AND INDIVIDUAL LIABILITY AND SUCCESSORS.  Each Mortgagor’s obligations under this Security Instrument are independent of the obligations of any other Mortgagor.  Lender may sue each Mortgagor individually or together with any other Mortgagor.  Lender may release any part of the Property and Mortgagor will still be obligated under this Security Instrument for the remaining Property.  If this Security Instrument secures a guaranty between Lender and Mortgagor, Mortgagor agrees to waive any rights that may prevent Lender from bringing any action or claim against Mortgagor or any party indebted under the obligation.  These rights may include, but are not limited to, any anti-deficiency or one-action laws.  Mortgagor agrees that Lender and any party to this Security Instrument may extend, modify or make any change in the terms of this Security Instrument or any evidence of debt without Mortgagor’s consent.  Such a change will not release Mortgagor from the terms of this Security Instrument.  The duties and benefits of this Security Instrument will bind and benefit the successors and assigns of Lender and Mortgagor.

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27.AMENDMENT, INTEGRATION AND SEVERABILITY.  This Security Instrument may not be amended or modified by oral agreement.  No amendment or modification of this Security Instrument is effective unless made in writing and executed by Mortgagor and Lender.  This Security Instrument and any other documents relating to the Secured Debts are the complete and final expression of the agreement.  If any provision of this Security Instrument is unenforceable, then the unenforceable provision will be severed and the remaining provisions will still be enforceable.

28.INTERPRETATION.  Whenever used, the singular includes the plural and the plural includes the singular.  The section headings are for convenience only and are not to be used to interpret or define the terms of this Security Instrument.

29.NOTICE, FINANCIAL REPORTS, ADDITIONAL DOCUMENTS AND RECORDING TAXES.  Unless otherwise required by law, any notice will be given by delivering it or mailing it by first class mail to the appropriate party’s address listed in the DATE AND PARTIES section, or to any other address designated in writing.  Notice to one Mortgagor will be deemed to be notice to all Mortgagors.  Mortgagor will inform Lender in writing of any change in Mortgagor’s name, address or other application information.  Mortgagor will provide Lender any financial statements or information Lender requests.  All financial statements and information Mortgagor gives Lender will be correct and complete.  Mortgagor agrees to pay all expenses, charges and taxes in connection with the preparation and recording of this Security Instrument.  Mortgagor agrees to sign, deliver, and file any additional documents or certifications that Lender may consider necessary to perfect, continue, and preserve Mortgagor’s obligations under this Security Instrument and to confirm Lender’s lien status on any Property, and Mortgagor agrees to pay all expenses, charges and taxes in connection with the preparation and recording thereof.  Time is of the essence.

SIGNATURES.  By signing, Mortgagor agrees to the terms and covenants contained in this Security Instrument.  Mortgagor also acknowledges receipt of a copy of this Security Instrument.

THIS IS A BALLOON MORTGAGE AND THE FINAL PRINCIPAL PAYMENT OR THE PRINCIPAL DUE UPON MATURITY IS APPROXIMATELY $250,918.91, TOGETHER WITH ACCRUED INTEREST, IF ANY, AND ALL ADVANCES MADE BY THE MORTGAGEE UNDER THE TERMS OF THIS MORTGAGE.

MORTGAGOR:

CTD Holdings, Inc.

By: /s/ Charles E. Strattan                                                             

Charles E. Strattan, President

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LENDER:

Sunstate Federal Credit Union

By: /s/ Brian Miller        

Brian Miller, Commercial Loan Officer

ACKNOWLEDGMENT.

(Business or Entity)

State of Florida, County of Alachua ss.

This instrument was acknowledged before me this 21st day of March, 2011 by Charles E. Strattan - President of CTD Holdings, Inc., a Florida corporation, on behalf of the corporation. He/she/they is/are personally known to me or has/have produced his driver’s license as identification.

My commission expires: June 3, 2011

/s/ John F. Roscow, IV                  

(Notary Public)

(Lender Acknowledgment)

State of Florida, County of Alachua ss.

This instrument was acknowledged before me this 21st day of March, 2011 by Brian Miller – Commercial Loan Officer of Sunstate Federal Credit Union, a corporation, on behalf of the corporation. He/she/they is/are personally known to me or has/have produced __________________________ as identification.

My commission expires: June 3, 2011

/s/ John F. Roscow, IV                          

 (Notary Public)

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EX-10.5

Exhibit 10.5

THIS IS A BALLOON MORTGAGE AND THE FINAL PRINCIPAL PAYMENT OR THE PRINCIPAL DUE UPON MATURITY IS APPROXIMATELY $250,918.91, TOGETHER WITH ACCRUED INTEREST, IF ANY, AND ALL ADVANCES MADE BY THE MORTGAGEE UNDER THE TERMS OF THIS MORTGAGE.

Return to:  Sunstate Federal Credit Union, 405 SE 2nd Place, Gainesville, FL 32402

This document was prepared by:  Member Business Solutions, LLC, 3692 Coolidge Court, #200, Tallahassee, FL 32311-7890

State of Florida’s Documentary Stamp Tax required by law in the amount of $1,137.50 has been paid to the Clerk of the Circuit Court (or the County Comptroller, if applicable) for the County of Alachua, State of Florida.

Space Above This Line For Recording Data

ASSIGNMENT OF LEASES AND RENTS

DATE AND PARTIES.  The date of this Assignment of Leases and Rents (Assignment) is March 22, 2011.  The parties and their addresses are:

ASSIGNOR:

CTD HOLDINGS, INC.

A Florida Corporation

f/k/a Cyclodextrin Technologies Development, Inc.

27317 NW 78th Avenue

High Springs, FL 32643

LENDER:

SUNSTATE FEDERAL CREDIT UNION

Organized and existing under the laws of Florida

405 SE 2nd Place

Gainesville, FL 32602

1.SECURED DEBTS.  The term “Secured Debts” includes and this Assignment will secure each of the following:

A.Specific Debts.  The following debts and all extensions, renewals, refinancings, modifications and replacements.  A promissory note or other agreement, No. 103428-01, dated March 22, 2011, from Assignor to Lender, with a loan amount of $325,000.00 and maturing on March 22, 2016.

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B.All Debts.  All present and future debts made within 20 years from the date of this Assignment from Assignor to Lender, even if this Assignment is not specifically referenced, or if the future debt is unrelated to or of a different type than this debt.  If more than one person signs this Assignment, each agrees that it will secure debts incurred either individually or with others who may not sign this Assignment.  Nothing in this Assignment constitutes a commitment to make additional or future loans or advances.  Any such commitment must be in writing.  In the event that Lender fails to provide any required notice of the right of rescission, Lender waives any subsequent security interest in the Assignor’s principal dwelling that is created by this Assignment.  This Assignment will not secure any debt for which a non-possessory, non-purchase money security interest is created in “household goods” in connection with a “consumer loan,” as those terms are defined by federal law governing unfair and deceptive credit practices.  This Assignment will not secure any debt for which a security interest is created in “margin stock” and Lender does not obtain a “statement of purpose,” as defined and required by federal law governing securities.  This Assignment will not secure any other debt if Lender fails, with respect to that other debt, to fulfill any necessary requirements or limitations of Sections 19(a), 32, or 35 of Regulation Z.

C.Sums Advanced.  All sums advanced and expenses incurred by Lender under the terms of this Assignment.

2.MAXIMUM OBLIGATION LIMIT.  The total principal amount secured by this Assignment at any one time and from time to time will not exceed $325,000.00.  Any limitation of amount does not include interest and other fees and charges validly made pursuant to this Assignment.  Also, this limitation does not apply to advances made under the terms of this Assignment to protect Lender’s security and to perform any of the covenants contained in this Assignment.

3.ASSIGNMENT OF LEASES AND RENTS.  For good and valuable consideration, the receipt and sufficiency of which is acknowledged, and to secure the Secured Debts and Assignor’s performance under this Assignment, Assignor does hereby assign, grant, bargain, convey and mortgage to Lender as additional security all the right, title and interest in the following (Property).

A.Existing or future leases, subleases, licenses, guaranties and any other written or verbal agreements for the use and occupancy of the Property, including but not limited to any extensions, renewals, modifications or replacements (Leases).

B.Rents, issues and profits, including but not limited to security deposits, minimum rents, percentage rents, additional rents, common area maintenance charges, parking charges, real estate taxes, other applicable taxes, insurance premium contributions, liquidated damages following default, cancellation premiums, “loss of rents” insurance, guest receipts, revenues, royalties, proceeds, bonuses, accounts, contract rights, general intangibles, and all rights and claims which Assignor may have regarding the Property (Rents).

C.The term Property as used in this Assignment shall include the following described real property:

THE NW 1/4 OF THE SE 1/4 OF SECTION 8, TOWNSHIP 9 SOUTH, RANGE 17 EAST, ALACHUA COUNTY, FLORIDA.

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TOGETHER WITH ROAD RIGHT-OF-WAY EASEMENT OVER THE WEST 30.00 FEET OF THE NE 1/4 OF SECTION 8, TOWNSHIP 9 SOUTH, RANGE 17 EAST, ALACHUA COUNTY, FLORIDA, AS PER O.R. BOOK 1977, PAGE 476, PUBLIC RECORDS OF ALACHUA COUNTY, FLORIDA.

The property is located in Alachua County at 27317 NW 78th Avenue, High Springs, Florida 32643.

In the event any item listed as Leases or Rents is determined to be personal property, this Assignment will also be regarded as a security agreement.

4.PAYMENTS.  Assignor agrees that all payments under the Secured Debts will be paid when due and in accordance with the terms of the Secured Debts and this Assignment.

5.COLLECTION OF RENTS.  Assignor may collect, receive, enjoy and use the Rents so long as Assignor is not in default.  Assignor will not collect in advance any Rents due in future lease periods, unless Assignor first obtains Lender’s written consent.

Upon default, Assignor will receive any Rents in trust for Lender and Assignor will not commingle the Rents with any other funds.  When Lender so directs, Assignor will endorse and deliver any payments of Rents from the Property to Lender.  Amounts collected will be applied at Lender’s discretion to the Secured Debts, the costs of managing, protecting and preserving the Property, and other necessary expenses.

Assignor agrees that this Assignment is immediately effective between Assignor and Lender and effective as to third parties on the recording of this Assignment.

6.COLLECTION EXPENSES AND ATTORNEYS’ FEES.  On or after the occurrence of an Event of Default, to the extent permitted by law, Assignor agrees to pay all expenses of collection, enforcement or protection of Lender’s rights and remedies under this Assignment or any other document relating to the Secured Debts.  Assignor agrees to pay expenses for Lender to inspect and preserve the Property and for any recordation costs of releasing the Property from this Assignment.  Expenses include, but are not limited to, attorneys’ fees of 10 percent of the Principal sum due or a larger amount as the court judges as reasonable and just, court costs and other legal expenses.  These expenses are due and payable immediately.  If not paid immediately, these expenses will bear interest from the date of payment until paid in full at the highest interest rate in effect as provided for in the terms of the Secured Debts.  In addition, to the extent permitted by the United States Bankruptcy Code, Assignor agrees to pay the reasonable attorneys’ fees incurred by Lender to protect Lender’s rights and interests in connection with any bankruptcy proceedings initiated by or against Assignor.

7.ENVIRONMENTAL LAWS AND HAZARDOUS SUBSTANCES.  As used in this section, (1) Environmental Law means, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA, 42 U.S.C. 9601 et seq.), all other federal, state and local laws, regulations, ordinances, court orders, attorney general opinions or interpretive letters concerning the public health, safety, welfare, environment or a hazardous substance; and (2) Hazardous Substance means any toxic, radioactive or hazardous material, waste, pollutant or contaminant which has characteristics which render the substance dangerous or potentially dangerous to the public health, safety, welfare or environment.  The term includes, without limitation, any substances defined as “hazardous material,” “toxic substance,” “hazardous waste,” “hazardous substance,” or “regulated substance” under any Environmental Law.

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Assignor represents, warrants and agrees that:

A.Except as previously disclosed and acknowledged in writing to Lender, no Hazardous Substance has been, is, or will be located, transported, manufactured, treated, refined, or handled by any person on, under or about the Property, except in the ordinary course of business and in strict compliance with all applicable Environmental Law.

B.Except as previously disclosed and acknowledged in writing to Lender, Assignor has not and will not cause, contribute to, or permit the release of any Hazardous Substance on the Property.

C.Assignor will immediately notify Lender if (1) a release or threatened release of Hazardous Substance occurs on, under or about the Property or migrates or threatens to migrate from nearby property; or (2) there is a violation of any Environmental Law concerning the Property.  In such an event, Assignor will take all necessary remedial action in accordance with Environmental Law.

D.Except as previously disclosed and acknowledged in writing to Lender, Assignor has no knowledge of or reason to believe there is any pending or threatened investigation, claim, or proceeding of any kind relating to (1) any Hazardous Substance located on, under or about the Property; or (2) any violation by Assignor or any tenant of any Environmental Law.  Assignor will immediately notify Lender in writing as soon as Assignor has reason to believe there is any such pending or threatened investigation, claim, or proceeding.  In such an event, Lender has the right, but not the obligation, to participate in any such proceeding including the right to receive copies of any documents relating to such proceedings.

E.Except as previously disclosed and acknowledged in writing to Lender, Assignor and every tenant have been, are and will remain in full compliance with any applicable Environmental Law.

F.Except as previously disclosed and acknowledged in writing to Lender, there are no underground storage tanks, private dumps or open wells located on or under the Property and no such tank, dump or well will be added unless Lender first consents in writing.

G.Assignor will regularly inspect the Property, monitor the activities and operations on the Property, and confirm that all permits, licenses or approvals required by any applicable Environmental Law are obtained and complied with.

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H.Assignor will permit, or cause any tenant to permit, Lender or Lender’s agent to enter and inspect the Property and review all records at any reasonable time to determine (1) the existence, location and nature of any Hazardous Substance on, under or about the Property; (2) the existence, location, nature, and magnitude of any Hazardous Substance that has been released on, under or about the Property; or (3) whether or not Assignor and any tenant are in compliance with applicable Environmental Law.

I.Upon Lender’s request and at any time, Assignor agrees, at Assignor’s expense, to engage a qualified environmental engineer to prepare an environmental audit of the Property and to submit the results of such audit to Lender.  The choice of the environmental engineer who will perform such audit is subject to Lender’s approval.

J.Lender has the right, but not the obligation, to perform any of Assignor’s obligations under this section at Assignor’s expense.

K.As a consequence of any breach of any representation, warranty or promise made in this section, (1) Assignor will indemnify and hold Lender and Lender’s successors or assigns harmless from and against all losses, claims, demands, liabilities, damages, cleanup, response and remediation costs, penalties and expenses, including without limitation all costs of litigation and attorneys’ fees, which Lender and Lender’s successors or assigns may sustain; and (2) at Lender’s discretion, Lender may release this Assignment and in return Assignor will provide Lender with collateral of at least equal value to the Property without prejudice to any of Lender’s rights under this Assignment.

L.Notwithstanding any of the language contained in this Assignment to the contrary, the terms of this section will survive any foreclosure or satisfaction of this Assignment regardless of any passage of title to Lender or any disposition by Lender of any or all of the Property.  Any claims and defenses to the contrary are hereby waived.

8.CONDEMNATION.  Assignor will give Lender prompt notice of any pending or threatened action by private or public entities to purchase or take any or all of the Property through condemnation, eminent domain, or any other means.  Assignor authorizes Lender to intervene in Assignor’s name in any of the above described actions or claims.  Assignor assigns to Lender the proceeds of any award or claim for damages connected with a condemnation or other taking of all or any part of the Property.  Such proceeds will be considered payments and will be applied as provided in this Assignment.  This assignment of proceeds is subject to the terms of any prior mortgage, deed of trust, security agreement or other lien document.

9.APPOINTMENT OF A RECEIVER.  On or after an Assignor’s default, Assignor agrees to Lender making an application to the court for an appointment of a receiver for the benefit of Lender to take possession of the Property and the Leases, with the power to receive, collect and apply the Rents.  Any Rents collected will be applied as the court authorizes to pay taxes, to provide insurance, to make repairs and to pay costs or any other expenses relating to the Property, the Leases and Rents, and any remaining sums shall be applied to the Secured Debts.  Assignor agrees that this appointment of a receiver may be without giving bond, without reference to the then-existing value of the Property, and without regard to the insolvency of any person liable for any of the Secured Debts.

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10.DUE ON SALE OR ENCUMBRANCE.  Lender may, at its option, declare the entire balance of the Secured Debt to be immediately due and payable upon the creation of, or contract for the creation of, any lien, encumbrance, transfer or sale of all or any part of the Property.  This right is subject to the restrictions imposed by federal law (12 C.F.R. 591), as applicable.

11.TRANSFER OF AN INTEREST IN THE ASSIGNOR.  If Assignor is an entity other than a natural person (such as a corporation, partnership, limited liability company or other organization), Lender may demand immediate payment if:

A.A beneficial interest in Assignor is sold or transferred.

B.There is a change in either the identity or number of members of a partnership or similar entity.

C.There is a change in ownership of more than 25 percent of the voting stock of a corporation, partnership, limited liability company or similar entity.

However, Lender may not demand payment in the above situations if it is prohibited by law as of the date of this Assignment.

12.WARRANTIES AND REPRESENTATIONS.  Assignor makes to Lender the following warranties and representations which will continue as long as this Assignment is in effect:

A.Power.  Assignor is duly organized, and validly existing and in good standing in all jurisdictions in which Assignor operates.  Assignor has the power and authority to enter into this transaction and to carry on Assignor’s business or activity as it is now being conducted and, as applicable, is qualified to do so in each jurisdiction in which Assignor operates.

B.Authority.  The execution, delivery and performance of this Assignment and the obligation evidenced by this Assignment are within Assignor’s powers, have been duly authorized, have received all necessary governmental approval, will not violate any provision of law, or order of court or governmental agency, and will not violate any agreement to which Assignor is a party or to which Assignor is or any of Assignor’s property is subject.

C.Name and Place of Business.  Other than previously disclosed in writing to Lender, Assignor has not changed Assignor’s name or principal place of business within the last 10 years and has not used any other trade or fictitious name.  Without Lender’s prior written consent, Assignor does not and will not use any other name and will preserve Assignor’s existing name, trade names and franchises.

D.Title.  Assignor has good title to the Leases, Rents and Property and the right to assign, grant, bargain, convey and mortgage to Lender as additional security the Leases and Rents, and no other person has any right in the Leases and Rents.

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E.Recordation.  Assignor has recorded the Leases as required by law or as otherwise prudent for the type and use of the Property.

F.Default.  No default exists under the Leases, and the parties subject to the Leases have not violated any applicable law on leases, licenses and landlords and tenants.  Assignor, at its sole cost and expense, will keep, observe and perform, and require all other parties to the Leases to comply with the Leases and any applicable law.  If Assignor or any party to the Lease defaults or fails to observe any applicable law, Assignor will promptly notify Lender,

G.Lease Modification.  Assignor has not sublet, modified, extended, canceled, or otherwise altered the Leases, or accepted the surrender of the Property covered by the Leases (unless the Leases so require).

H.Encumbrance.  Assignor has not assigned, compromised, subordinated or encumbered the Leases and Rents.

13.COVENANTS.  Assignor agrees to the following covenants:

A.Rent Abatement and Insurance.  When any Lease provides for an abatement of Rents due to fire, flood or other casualty, Assignor will insure against this risk of loss with a policy satisfactory to Lender.  Assignor may choose the insurance company, subject to Lender’s approval, which will not be unreasonably withheld.

B.Copies of Leases.  Assignor will promptly provide Lender with copies of the Leases and will certify these Leases are true and correct copies.  The existing Leases will be provided on execution of the Assignment, and all future Leases and any other information with respect to these Leases will be provided immediately after they are executed.

C.Right To Rents.  Immediately after the execution of this Assignment, Assignor will notify all current and future tenants and others obligated under the Leases of Lender’s rights to the Leases and Rents, and will request that they immediately pay all future Rents directly to Lender when Assignor or Lender asks them to do so.

D.Accounting.  When Lender requests, Assignor will provide to Lender an accounting of Rents, prepared in a form acceptable to Lender, subject to generally accepted accounting principles and certified by Assignor or Assignor’s accountant to be current, accurate and complete as of the date requested by Lender.

E.Lease Modification.  Assignor will not sublet, modify, extend, cancel, or otherwise alter the Leases, or accept the surrender of the Property covered by the Leases (unless the Leases so require) without Lender’s written consent.

F.Encumbrance.  Assignor will not assign, compromise, subordinate or encumber the Leases and Rents without Lender’s prior written consent.

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G.Future Leases.  Assignor will not enter into any future Leases without prior written consent from Lender.  Assignor will execute and deliver such further assurances and assignments as to these future Leases as Lender requires from time to time.

H.Personal Property.  Assignor will not sell or remove any personal property on the Property, unless Assignor replaces this personal property with like kind for the same or better value.

I.Prosecution and Defense of Claims.  Assignor will appear in and prosecute its claims or defend its title to the Leases and Rents against any claims that would impair Assignor’s interest under this Assignment and, on Lender’s request, Assignor will also appear in any action or proceeding on behalf of Lender.  Assignor agrees to assign to Lender, as requested by Lender, any right, claims or defenses which Assignor may have against parties who supply labor or materials to improve or maintain the leaseholds subject to the Leases and/or the Property.

J.Liability and Indemnification.  Lender does not assume or become liable for the Property’s maintenance, depreciation, or other losses or damages when Lender acts to manage, protect or preserve the Property, except for losses or damages due to Lender’s gross negligence or intentional torts.  Otherwise, Assignor will indemnify Lender and hold Lender harmless for all liability, loss or damage that Lender may incur when Lender opts to exercise any of its remedies against any party obligated under the Leases.

K.Leasehold Estate.  Assignor will not cause or permit the leasehold estate under the Leases to merge with Assignor’s reversionary interest, and agrees that the Leases shall remain in full force and effect regardless of any merger of the Assignor’s interests and of any merger of the interests of Assignor and any party obligated under the Leases.

L.Insolvency.  Lender will be the creditor of each tenant and of anyone else obligated under the Leases who is subject to an assignment for the benefit of creditors, an insolvency, a dissolution or a receivership proceeding, or a bankruptcy.

14.DEFAULT.  Assignor will be in default if any of the following events (known separately and collectively as an Event of Default) occur:

A.Payments.  Assignor fails to make a payment in full when due.

B.Insolvency or Bankruptcy.  The death, dissolution or insolvency of, appointment of a receiver by or on behalf of, application of any debtor relief law, the assignment for the benefit of creditors by or on behalf of, the voluntary or involuntary termination of existence by, or the commencement of any proceeding under any present or future federal or state insolvency, bankruptcy, reorganization, composition or debtor relief law by or against Assignor, Borrower, or any co-signer, endorser, surety or guarantor of this Assignment or any other obligations Borrower has with Lender.

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C.Business Termination.  Assignor merges, dissolves, reorganizes, ends its business or existence, or a partner or majority owner dies or is declared legally incompetent.

D.Failure to Perform.  Assignor fails to perform any condition or to keep any promise or covenant of this Assignment.

E.Other Documents.  A default occurs under the terms of any other document relating to the Secured Debts.

F.Other Agreements.  Assignor is in default on any other debt or agreement Assignor has with Lender.

G.Misrepresentation.  Assignor makes any verbal or written statement or provides any financial information that is untrue, inaccurate, or conceals a material fact at the time it is made or provided.

H.Judgment.  Assignor fails to satisfy or appeal any judgment against Assignor.

I.Forfeiture.  The Property is used in a manner or for a purpose that threatens confiscation by a legal authority.

J.Name Change.  Assignor changes Assignor’s name or assumes an additional name without notifying Lender before making such a change.

K.Property Transfer.  Assignor transfers all or a substantial part of Assignor’s money or property.  This condition of default, as it relates to the transfer of the Property, is subject to the restrictions contained in the DUE ON SALE section.

L.Property Value.  Lender determines in good faith that the value of the Property has declined or is impaired.

M.Material Change.  Without first notifying Lender, there is a material change in Assignor’s business, including ownership, management, and financial conditions.

N.Insecurity.  Lender determines in good faith that a material adverse change has occurred in Assignor’s financial condition from the conditions set forth in Assignor’s most recent financial statement before the date of this Assignment or that the prospect for payment or performance of the Secured Debts is impaired for any reason.

15.REMEDIES.  After Assignor defaults, Lender may at Lender’s option do any one or more of the following.

A.Acceleration.  Lender may make all or any part of the amount owing by the terms of the Secured Debts immediately due.

B.Additional Security.  Lender may demand additional security or additional parties to be obligated to pay the Secured Debts.

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C.Sources.  Lender may use any and all remedies Lender has under Florida or federal law or in any document relating to the Secured Debts.

D.Insurance Benefits.  Lender may make a claim for any and all insurance benefits or refunds that may be available on Assignor’s default.

E.Payments Made On Assignor’s Behalf.  Amounts advanced on Assignor’s behalf will be immediately due and may be added to the Secured Debts.

F.Rents.  Lender may terminate Assignor’s right to collect Rents and directly collect and retain Rents in Lender’s name without taking possession of the Property and to demand, collect, receive, and sue for the Rents, giving proper receipts and releases.  In addition, after deducting all reasonable expenses of collection from any collected and retained Rents, Lender may apply the balance as provided for by the Secured Debts.

G.Entry.  Lender may enter, take possession, manage and operate all or any part of the Property; make, modify, enforce or cancel or accept the surrender of any Leases; obtain or evict any tenants or licensees; increase or reduce Rents; decorate, clean and make repairs or do any other act or incur any other cost Lender deems proper to protect the Property as fully as Assignor could do.  Any funds collected from the operation of the Property may be applied in such order as Lender may deem proper, including, but not limited to, payment of the following:  operating expenses, management, brokerage, attorneys’ and accountants’ fees, the Secured Debts, and toward the maintenance of reserves for repair or replacement.  Lender may take such action without regard to the adequacy of the security, with or without any action or proceeding, through any person or agent, or receiver to be appointed by a court, and irrespective of Assignor’s possession.

The collection and application of the Rents or the entry upon and taking possession of the Property as set out in this section shall not cure or waive any notice of default under the Secured Debts, this Assignment, or invalidate any act pursuant to such notice.  The enforcement of such remedy by Lender, once exercised, shall continue for so long as Lender shall elect, notwithstanding that such collection and application of Rents may have cured the original default.

H.Waiver.  Except as otherwise required by law, by choosing any one or more of these remedies Lender does not give up any other remedy. Lender does not waive a default if Lender chooses not to use a remedy.  By electing not to use any remedy, Lender does not waive Lender’s right to later consider the event a default and to use any remedies if the default continues or occurs again.

16.TERM.  This Assignment will remain in full force and effect until the Secured Debts are paid or otherwise discharged and Lender is no longer obligated to advance funds under any loan or credit agreement which is a part of the Secured Debts.  If any or all payments of the Secured Debts are subsequently invalidated, declared void or voidable, or set aside and are required to be repaid to a trustee, custodian, receiver or any other party under any bankruptcy act or other state or federal law, then the Secured Debts will be revived and will continue in full force and effect as if this payment had not been made.

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17.CO-SIGNERS.  If Assignor signs this Assignment but is not otherwise obligated to pay the Secured Debts, Assignor does so only to assign Assignor’s interest in the Property to secure payment of the Secured Debts and Assignor does not agree by signing this Assignment to be personally liable on the Secured Debts.  If this Assignment secures a guaranty between Lender and Assignor, Assignor agrees to waive any rights that may prevent Lender from bringing any action or claim against Assignor or any party indebted under the obligation.  These rights may include, but are not limited to, any anti-deficiency or one-action laws.

18.WAIVERS.  Except to the extent prohibited by law, Assignor waives all appraisement and homestead exemption rights relating to the Property.

19.FIXTURE FILING.  Assignor gives to Lender a security interest in all goods that Assignor owns now or in the future and that are or will become fixtures related to the Property.

20.OTHER TERMS.  The following are applicable to this Assignment:

A.No Action by Lender.  Nothing contained in this Assignment shall require Lender to take any action.

B.Additional Terms.  THE OCCURRENCE OF ANY DEFAULT OF THE BORROWER(S) IN PAYMENT OF THIS PROMISSORY NOTE SHALL ALSO CONSTITUTE AN EVENT OF DEFAULT WITH RESPECT TO THE INDEBTEDNESS OF THE BORROWER(S) EVIDENCED BY THAT CERTAIN PROMISSORY NOTE NUMBER 103428-02 DATED MARCH 22, 2011, EXECUTED BY CTD HOLDINGS, INC., IN THE ORIGINAL PRINCIPAL AMOUNT OF $100,000.00, TOGETHER WITH ANY AND ALL EXTENSIONS, RENEWALS, MODIFICATIONS, SUBSTITUTIONS, REPLACEMENTS, AND CHANGES IN FORM THEREOF, WHICH MAY FROM TIME TO TIME AND FOR ANY TERM OR TERMS ARE EFFECTED BY AN AGREEMENT BETWEEN BORROWER(S) AND THE LENDER.

21.APPLICABLE LAW.  This Assignment is governed by the laws of Florida, the United States of America, and to the extent required, by the laws of the jurisdiction where the Property is located, except to the extent such state laws are preempted by federal law.

22.JOINT AND INDIVIDUAL LIABILITY AND SUCCESSORS.  Each Assignor’s obligations under this Assignment are independent of the obligations of any other Assignor.  Lender may sue each Assignor individually or together with any other Assignor.  Lender may release any part of the Property and Assignor will still be obligated under this Assignment for the remaining Property.  If this Assignment secures a guaranty between Lender and Assignor, Assignor agrees to waive any rights that may prevent Lender from bringing any action or claim against Assignor or any party indebted under the obligation.  These rights may include, but are not limited to, any anti-deficiency or one-action laws.  Assignor agrees that Lender and any party to this Assignment may extend, modify or make any change in the terms of this Assignment or any evidence of debt without Assignor’s consent.  Such a change will not release Assignor from the terms of this Assignment.  Lender may assign all or part of Lender’s rights under this Assignment without Assignor’s consent.  If Lender assigns this Assignment, all of Assignor’s covenants, agreements, representations and warranties contained in this Assignment will benefit Lender’s successors and assigns.  The duties of this Assignment will bind the successors and assigns of Assignor.

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23.AMENDMENT, INTEGRATION AND SEVERABILITY.  This Assignment may not be amended or modified by oral agreement.  No amendment or modification of this Assignment is effective unless made in writing and executed by Assignor and Lender.  This Assignment and any other documents relating to the Secured Debts are the complete and final expression of the agreement.  If any provision of this Assignment is unenforceable, then the unenforceable provision will be severed and the remaining provisions will still be enforceable.

24.INTERPRETATION.  Whenever used, the singular includes the plural and the plural includes the singular.  The section headings are for convenience only and are not to be used to interpret or define the terms of this Assignment.

25.NOTICE, FINANCIAL REPORTS, ADDITIONAL DOCUMENTS AND RECORDING TAXES.  Unless otherwise required by law, any notice will be given by delivering it or mailing it by first class mail to the appropriate party’s address listed in the DATE AND PARTIES section, or to any other address designated in writing.  Notice to one Assignor will be deemed to be notice to all Assignors.  Assignor will inform Lender in writing of any change in Assignor’s name, address or other application information.  Assignor will provide Lender any financial statements or information Lender requests.  All financial statements and information Assignor gives Lender will be correct and complete.  Assignor agrees to pay all expenses, charges and taxes in connection with the preparation and recording of this Assignment.  Assignor agrees to sign, deliver, and file any additional documents or certifications that Lender may consider necessary to perfect, continue, and preserve Assignor’s obligations under this Assignment and to confirm Lender’s lien status on any Property, and Assignor agrees to pay all expenses, charges and taxes in connection with the preparation and recording thereof.  Time is of the essence.

26.WAIVER OF JURY TRIAL.  All of the parties to this Assignment knowingly and intentionally, irrevocably and unconditionally, waive any and all right to a trial by jury in any litigation arising out of or concerning this Assignment or any other documents relating to the Secured Debts or related obligation.  All of these parties acknowledge that this section has either been brought to the attention of each party’s legal counsel or that each party had the opportunity to do so.

27.SIGNATURES.  By signing, Assignor agrees to the terms and covenants contained in this Assignment.  Assignor also acknowledges receipt of a copy of this Assignment.

THIS IS A BALLOON MORTGAGE AND THE FINAL PRINCIPAL PAYMENT OR THE PRINCIPAL DUE UPON MATURITY IS APPROXIMATELY $250,918.91, TOGETHER WITH ACCRUED INTEREST, IF ANY, AND ALL ADVANCES MADE BY THE MORTGAGEE UNDER THE TERMS OF THIS MORTGAGE.

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ASSIGNOR:

CTD Holdings, Inc.

By: /s/ Charles E. Strattan                     

Charles E. Strattan, President

LENDER:

Sunstate Federal Credit Union

By: /s/ Brian Miller                                

Brian Miller, Commercial Loan Officer

ACKNOWLEDGMENT.

(Business or Entity)

State of Florida, County of Alachua ss.

This instrument was acknowledged before me this 21st day of March, 2011 by Charles E. Strattan - President of CTD Holdings, Inc., a Florida corporation, on behalf of the corporation.  He/she/they is/are personally known to me or has/have produced his driver’s license as identification.

My commission expires: June 3, 2011

/s/ John F. Roscow, IV                                                                

(Notary Public)

(Lender Acknowledgment)

State of Florida, County of Alachua ss.

This instrument was acknowledged before me this 21st day of March, 2011 by Brian Miller – Commercial Loan Officer of Sunstate Federal Credit Union, a corporation, on behalf of the corporation.  He/she/they is/are personally known to me or has/have produced __________________________ as identification.

My commission expires: June 3, 2011

/s/ John F. Roscow, IV                                                                

 (Notary Public)

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EX-10.6

Exhibit 10.6

GUARANTY

(Continuing Debt – Unlimited)

DATE AND PARTIES.  The date of this Guaranty is March 22, 2011.  The parties and their addresses are:

LENDER:

SUNSTATE FEDERAL CREDIT UNION

405 SE 2nd Place

Gainesville, FL 32602

Telephone: (352) 381-5200 x5197

BORROWER:

CTD HOLDINGS, INC.

a Florida Corporation

27317 NW 78th Avenue

High Springs, FL 32643

GUARANTOR:

CHARLES E. STRATTAN

4123 NW 46th Avenue

Gainesville, FL 32606

1.DEFINITIONS.  As used in this Guaranty, the terms have the following meanings:

A.Pronouns.  The pronouns “I”, “me” and “my” refer to all persons or entities signing this Guaranty, individually and together.  “You” and “your” refer to the Lender.

B.Note.  “Note” refers to the document that evidences the Borrower’s indebtedness, and any extensions, renewals, modifications and substitutions of the Note.

C.Property.  “Property” means any property, real, personal or intangible, that secures performance of the obligations of the Note, Debt, or this Guaranty.

2.SPECIFIC AND FUTURE DEBT GUARANTY.  For good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and to induce you, at your option, to make loans or engage in any other transactions with the Borrower from time to time, I absolutely and unconditionally agree to all terms of and guaranty to you the payment and performance of each and every Debt, of every type, purpose and description that the Borrower either individually, among all or a portion of themselves, or with others, may now or at any time in the future owe you, including, but not limited to the following described Debt(s) including without limitation, all principal, accrued interest, attorneys’ fees and collection costs, when allowed by law, that may become due from the Borrower to you in collecting and enforcing the Debt and all other agreements with respect to the Borrower.

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A promissory note or other agreement, No. 103428-01, dated March 22, 2011, from CTD Holdings, Inc.  (Borrower) to you, in the amount of $325,000.00.

In addition, Debt refers to debts, liabilities, and obligations of the Borrower (including, but not limited to, amounts agreed to be paid under the terms of any notes or agreements securing the payment of any debt, loan, liability or obligation, overdrafts, letters of credit, guaranties, advances for taxes, insurance, repairs and storage, and all extensions, renewals, refinancings and modifications of these debts) whether now existing or created or incurred in the future, due or to become due, or absolute or contingent, including obligations and duties arising from the terms of all documents prepared or submitted for the transaction such as applications, security agreements, disclosures, and the Note.

You may, without notice, apply this Guaranty to such Debt of the Borrower as you may select from time to time.

3.EXTENSIONS.  I consent to all renewals, extensions, modifications and substitutions of the Debt which may be made by you upon such terms and conditions as you may see fit from time to time without further notice to me and without limitation as to the number of renewals, extensions, modifications or substitutions.

A.Future Advances.  I waive notice of and consent to any and all future advances made to the Borrower by you.

4.UNCONDITIONAL LIABILITY.  I am unconditionally liable under this Guaranty, regardless of whether or not you pursue any of your remedies against the Borrower, against any other maker, surety, guarantor or endorser of the Debt or against any Property.  You may sue me alone, or anyone else who is obligated on this Guaranty, or any number of us together, to collect the Debt.  My liability is not conditioned on the signing of this Guaranty by any other person and further is not subject to any condition not expressly set forth in this Guaranty or any instrument executed in connection with the Debt.  My obligation to pay according to the terms of this Guaranty shall not be affected by the illegality, invalidity or unenforceability of any notes or agreements evidencing the Debt, the violation of any applicable usury laws, forgery, or any other circumstances which make the indebtedness unenforceable against the Borrower.  I will remain obligated to pay on this Guaranty even if any other person who is obligated to pay the Debt, including the Borrower, has such obligation discharged in bankruptcy, foreclosure, or otherwise discharged by law.

5.BANKRUPTCY.  If a bankruptcy petition should at any time be filed by or against the Borrower, the maturity of the Debt, so far as my liability is concerned, shall be accelerated and the Debt shall be immediately payable by me.  I acknowledge and agree that this Guaranty, and the Debt secured hereby, will remain in full force and effect at all times, notwithstanding any action or undertakings by, or against, you or against any Property, in connection with any obligation in any proceeding in the United States Bankruptcy Courts.  Such action or undertaking includes, without limitation, valuation of Property, election of remedies or imposition of secured or unsecured claim status upon claims by you, pursuant to the United States Bankruptcy Code, as amended.  In the event that any payment of principal or interest received and paid by any other guarantor, borrower, surety, endorser or co-maker is deemed, by final order of a court of competent jurisdiction, to have been a voidable preference under the bankruptcy or insolvency laws of the United States or otherwise, then my obligation will remain as an obligation to you and will not be considered as having been extinguished.

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6.REVOCATION.  I agree that this is an absolute and unconditional Guaranty.  I agree that this Guaranty will remain binding on me, whether or not there are any Debts outstanding, until you have actually received written notice of my revocation or written notice of my death or incompetence.  Notice of revocation or notice of my death or incompetence will not affect my obligations under this Guaranty with respect to any Debts incurred by or for which you have made a commitment to Borrower before you actually receive such notice, and all renewals, extensions, refinancings, and modifications of such Debts.  I agree that if any other person signing this Guaranty provides a notice of revocation to you, I will still be obligated under this Guaranty until I provide such a notice of revocation to you.  If any other person signing this Guaranty dies or is declared incompetent, such fact will not affect my obligations under this Guaranty.

7.PROPERTY.  I agree that any Property may be assigned, exchanged, released in whole or in part or substituted without notice to me and without defeating, discharging or diminishing my liability.  My obligation is absolute and your failure to perfect any security interest or any act or omission by you which impairs the Property will not relieve me or my liability under this Guaranty.  You are under no duty to preserve or protect any Property until you are in actual or constructive possession.  For purposes of this paragraph, you will only be in “actual” possession when you have physical, immediate and exclusive control over the Property and have accepted such control in writing.  Further, you will only be deemed to be in “constructive” possession when you have both the power and intent to exercise control over the Property.

8.DEFAULT.  I will be in default if any of the following events (known separately and collectively as an Event of Default) occur:

A.Payments.  I fail to make a payment in full when due.

B.Insolvency or Bankruptcy.  The death, dissolution or insolvency of, appointment of a receiver by or on behalf of, application of any debtor relief law, the assignment for the benefit of creditors by or on behalf of, the voluntary or involuntary termination of existence by, or the commencement of any proceeding under any present or future federal or state insolvency, bankruptcy, reorganization, composition or debtor relief law by or against me, Borrower, or any co-signer, endorser, surety or guarantor of this Guaranty or any Debt.

C.Death or Incompetency.  I die or am declared legally incompetent.

D.Failure to Perform.  I fail to perform any condition or to keep any promise or covenant of this Guaranty.

E.Other Documents.  A default occurs under the terms of any other document relating to the Debt.

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F.Other Agreements.  I am in default on any other debt or agreement I have with you.

G.Misrepresentation.  I make any verbal or written statement or provide any financial information that is untrue, inaccurate, or conceals a material fact at the time it is made or provided.

H.Judgment.  I fail to satisfy or appeal any judgment against me.

I.Forfeiture.  The Property is used in a manner or for a purpose that threatens confiscation by a legal authority.

J.Name Change.  I change my name or assume an additional name without notifying you before making such a change.

K.Property Transfer.  I transfer all or a substantial part of my money or property.

L.Property Value.  You determine in good faith that the value of the Property has declined or is impaired.

M.Insecurity.  You determine in good faith that a material adverse change has occurred in my financial condition from the conditions set forth in my most recent financial statement before the date of this Guaranty or that the prospect for payment or performance of the Debt is impaired for any reason.

9.WAIVERS AND CONSENT.  To the extent not prohibited by law, I waive protest, presentment for payment, demand, notice of acceleration, notice of intent to accelerate and notice of dishonor.

A.Additional Waivers.  In addition, to the extent permitted by law, I consent to certain actions you may take, and generally waive defenses that may be available based on these actions or based on the status of a party to the Debt or this Guaranty.

(1)You may renew or extend payments on the Debt, regardless of the number of such renewals or extensions.

(2)You may release any Borrower, endorser, guarantor, surety, accommodation maker or any other co-signer.

(3)You may release, substitute or impair any Property.

(4)You, or any institution participating in the Debt, may invoke your right of set-off.

(5)You may enter into any sales, repurchases or participations of the Debt to any person in any amounts and I waive notice of such sales, repurchases or participations.

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(6)I agree that the Borrower is authorized to modify the terms of the Debt or any instrument securing, guarantying or relating to the Debt.

(7)You may undertake a valuation of any Property in connection with any proceedings under the United States Bankruptcy Code concerning the Borrower or me, regardless of any such valuation, or actual amounts received by you arising from the sale of such Property.

(8)I agree to consent to any waiver granted the Borrower, and agree that any delay or lack of diligence in the enforcement of the Debt, or any failure to file a claim or otherwise protect any of the Debt, in no way affects or impairs my liability.

(9)I agree to waive reliance on any anti-deficiency statutes, through subrogation or otherwise, and such statutes in no way affect or impair my liability. In addition, until the obligations of the Borrower to Lender have been paid in full, I waive any right of subrogation, contribution, reimbursement, indemnification, exoneration, and any other right I may have to enforce any remedy which you now have or in the future may have against the Borrower or another guarantor or as to any Property.

Any Guarantor who is an “insider,” as contemplated by the United States Bankruptcy Code, 11 U.S.C. 101, as amended, makes these waivers permanently.  (An insider includes, among others, a director, officer, partner, or other person in control of the Borrower, a person or an entity that is a co-partner with the Borrower, an entity in which the Borrower is a general partner, director, officer or other person in control or a close relative of any of these other persons.) Any Guarantor who is not an insider makes these waivers until all Debt is fully repaid.

B.No Waiver By Lender.  Your course of dealing, or your forbearance from, or delay in, the exercise of any of your rights, remedies, privileges or right to insist upon my strict performance of any provisions contained in the Debt instruments, shall not be construed as a waiver by you, unless any such waiver is in writing and is signed by you.

C.Waiver of Claims.  I waive all claims for loss or damage caused by your acts or omissions where you acted reasonably and in good faith.

10.REMEDIES.  After the Borrower or I default, you may at your option do any one or more of the following.

A.Acceleration.  You may make all or any part of the amount owing by the terms of this Guaranty immediately due.

B.Sources.  You may use any and all remedies you have under state or federal law or in any documents relating to the Debt.

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C.Insurance Benefits.  You may make a claim for any and all insurance benefits or refunds that may be available on default.

D.Payments Made on the Borrower’s Behalf.  Amounts advanced on the Borrower’s behalf will be immediately due and may be added to the balance owing under the Debt.

E.Attachment.  You may attach or garnish my wages or earnings.

F.Set-Off.  You may use the right of set-off. This means you may set-off any amount due and payable under the terms of this Guaranty against any right I have to receive money from you.

My right to receive money from you includes any deposit or share account balance I have with you; any money owed to me on an item presented to you or in your possession for collection or exchange; and any repurchase agreement or other non-deposit obligation.  “Any amount due and payable under the terms of this Guaranty” means the total amount to which you are entitled to demand payment under the terms of this Guaranty at the time you set-off.

Subject to any other written contract, if my right to receive money from you is also owned by someone who has not agreed to pay the Debt, your right of set-off will apply to my interest in the obligation and to any other amounts I could withdraw on my sole request or endorsement.

In addition, you may also have rights under a “statutory lien”.  A “statutory lien” means your right under state or federal law to establish a right in, or claim to, my shares and dividends to the extent of any outstanding financial obligations that I have with you.  If you have a statutory lien, you may without further notice, impress and enforce the statutory lien on my shares and dividends to the extent of any sums due and payable under the terms of this Guaranty that I fail to satisfy.

Your set-off and statutory lien rights do not apply to an account or other obligation where my rights arise only in a representative capacity.  They also do not apply to any Individual Retirement Account or other tax-deferred retirement account.

You will not be liable for the dishonor of any check or share draft when the dishonor occurs because you set-off against any of my accounts, or exercised your statutory lien rights.  I agree to hold you harmless from any such claims arising as a result of your exercise of your right of set-off or statutory lien rights.

G.Waiver.  Except as otherwise required by law, by choosing any one or more of these remedies you do not give up your right to use any other remedy. You do not waive a default if you choose not to use a remedy.  By electing not to use any remedy, you do not waive your right to later consider the event a default and to use any remedies if the default continues or occurs again.

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11.COLLECTION EXPENSES AND ATTORNEYS’ FEES.  On or after the occurrence of an Event of Default, to the extent permitted by law, I agree to pay all expenses of collection, enforcement or protection of your rights and remedies under this Guaranty or any other document relating to the Debt.  To the extent permitted by law, expenses include, but are not limited to, reasonable attorneys’ fees, court costs and other legal expenses.  All fees and expenses will be secured by the Property I have granted to you, if any.  In addition, to the extent permitted by the United States Bankruptcy Code, I agree to pay the reasonable attorneys’ fees incurred by you to protect your rights and interests in connection with any bankruptcy proceedings initiated by or against me.

12.WARRANTIES AND REPRESENTATIONS.  I have the right and authority to enter into this Guaranty.  The execution and delivery of this Guaranty will not violate any agreement governing me or to which I am a party.

In addition, I represent and warrant that this Guaranty was entered into at the request of the Borrower, and that I am satisfied regarding the Borrower’s financial condition and existing indebtedness, authority to borrow and the use and intended use of all Debt proceeds.  I further represent and warrant that I have not relied on any representations or omissions from you or any information provided by you respecting the Borrower, the Borrower’s financial condition and existing indebtedness, the Borrower’s authority to borrow or the Borrower’s use and intended use of all Debt proceeds.

13.RELIANCE.  I acknowledge that you are relying on this Guaranty in extending credit to the Borrower, and I have signed this Guaranty to induce you to extend such credit.  I represent and warrant to you that I have a direct and substantial economic interest in the Borrower and expect to derive substantial benefits from any loans and financial accommodations resulting in the creation of indebtedness guarantied hereby.  I agree to rely exclusively on the right to revoke this Guaranty prospectively as to future transactions in the manner as previously described in this Guaranty if at any time, in my opinion, the benefits then being received by me in connection with this Guaranty are not sufficient to warrant the continuance of this Guaranty.  You may rely conclusively on a continuing warranty that I continue to be benefited by this Guaranty and you will have no duty to inquire into or confirm the receipt of any such benefits, and this Guaranty will be effective and enforceable by you without regard to the receipt, nature or value of any such benefits.

14.APPLICABLE LAW.  This Guaranty is governed by the laws of Florida, the United States of America, and to the extent required, by the laws of the jurisdiction where the Property is located, except to the extent such state laws are preempted by federal law.

15.AMENDMENT, INTEGRATION AND SEVERABILITY.  This Guaranty may not be amended or modified by oral agreement.  No amendment or modification of this Guaranty is effective unless made in writing and executed by you and me.  This Guaranty is the complete and final expression of the agreement.  If any provision of this Guaranty is unenforceable, then the unenforceable provision will be severed and the remaining provisions will still be enforceable.

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16.ASSIGNMENT.  If you assign any of the Debts, you may assign all or any part of this Guaranty without notice to me or my consent, and this Guaranty will inure to the benefit of your assignee to the extent of such assignment.  You will continue to have the unimpaired right to enforce this Guaranty as to any of the Debts that are not assigned.  This Guaranty shall inure to the benefit of and be enforceable by you and your successors and assigns and any other person to whom you may grant an interest in the Debts and shall be binding upon and enforceable against me and my personal representatives, successors, heirs and assigns.

17.INTERPRETATION.  Whenever used, the singular includes the plural and the plural includes the singular.  The section headings are for convenience only and are not to be used to interpret or define the terms of this Guaranty.

18.NOTICE, FINANCIAL REPORTS AND ADDITIONAL DOCUMENTS.  Unless otherwise required by law, any notice will be given by delivering it or mailing it by first class mail to the appropriate party’s address listed in the DATE AND PARTIES section, or to any other address designated in writing.  Notice to one Guarantor will be deemed to be notice to all Guarantors.  I will inform you in writing of any change in my name, address or other application information.  I will provide you any financial statement or information you request.  All financial statements and information I give you will be correct and complete.  I agree to sign, deliver, and file any additional documents or certifications that you may consider necessary to perfect, continue, and preserve my obligations under this Guaranty and to confirm your lien status on any Property.  Time is of the essence.

19.CREDIT INFORMATION.  I agree that from time to time you may obtain credit information about me from others, including other lenders and credit reporting agencies, and report to others (such as a credit reporting agency) your credit experience with me.  I agree that you will not be liable for any claim arising from the use of information provided to you by others or for providing such information to others.

20.ADDITIONAL TERMS.  DURING THE TERM OF THIS GUARANTY, I/WE WILL PROVIDE THE FOLLOWING INFORMATION WITHIN THE TIME FRAMES OUTLINED:

–ANNUAL SIGNED PERSONAL FINANCIAL STATEMENTS (ON A FORM PROVIDED BY LENDER) DUE TO THE LENDER TWELVE (12) MONTHS FOLLOWING LAST DATED STATEMENT SUPPLIED.

–ANNUAL SIGNED FEDERAL TAX RETURNS DUE TO THE LENDER ON OR BEFORE APRIL 15th OF EACH YEAR.  IF AN EXTENSION IS FILED, A COPY OF SAME WILL PROMPTLY BE SUPPLIED TO THE LENDER AND THEN THE SIGNED COPY OF THE TAX RETURN WILL BE DUE TO THE LENDER THE SAME DAY IT IS DUE TO THE IRS FOR EACH YEAR.

21.WAIVER OF JURY TRIAL.  All of the parties to this Guaranty knowingly and intentionally, irrevocably and unconditionally, waive any and all right to a trial by jury in any litigation arising out of or concerning this Guaranty or any other documents relating to the Debt or related obligation.  All of these parties acknowledge that this section has either been brought to the attention of each party’s legal counsel or that each party had the opportunity to do so.

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22.SIGNATURES.  By signing, I agree to the terms contained in this Guaranty.  I also acknowledge receipt of a copy of this Guaranty.

GUARANTOR:

/s/ Charles E. Strattan                                                                

Charles E. Strattan

Individually

LENDER:

Sunstate Federal Credit Union

By: /s/ Brian Miller                                                              

Brian Miller, Commercial Loan Officer

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EX-10.7

EXHIBIT 10.7

LOAN NUMBER	LOAN NAME	ACCT. NUMBER	AGREEMENT DATE	INITIALS
103428-02	CTD Holdings, Inc.		03/22/11	BM
NOTE AMOUNT	INDEX (w/Margin)	RATE	MATURITY DATE	LOAN PURPOSE
$100,000.00	Wall Street Journal Prime plus	6.5%	Payable on Demand	Commercial
	2.000%
		Creditor Use Only

COMMERCIAL LOAN AGREEMENT

Revolving Draw Loan

DATE AND PARTIES.  The date of this Commercial Loan Agreement (Agreement) is March 22, 2011.  The parties and their addresses are as follows:

LENDER:

SUNSTATE FEDERAL CREDIT UNION

405 SE 2nd Place

Gainesville, FL 32602

BORROWER:

CTD HOLDINGS, INC.

a Florida Corporation

27317 NW 78th Avenue

High Springs, FL 32643

1.DEFINITIONS.  For the purposes of this Agreement, the following terms have the following meanings.

A.Accounting Terms.  In this Agreement, any accounting terms that are not specifically defined will have their customary meanings under generally accepted accounting principles.

B.Insiders.  Insiders include those defined as insiders by the United States Bankruptcy Code, as amended; or to the extent left undefined, include without limitation any officer, employee, stockholder or member, director, partner, or any immediate family member of any of the foregoing, or any person or entity which, directly or indirectly, controls, is controlled by or is under common control with me.

C.Loan.  The Loan refers to this transaction generally, including obligations and duties arising from the terms of all documents prepared or submitted for this transaction.

D.Loan Documents.  Loan Documents refer to all the documents executed as a part of or in connection with the Loan.

E.Pronouns.  The pronouns "I", "me" and "my" refer to every Borrower signing this Agreement, individually or together.  "You" and "your" refers to the Loan's lender.

F.Property.  Property is any property, real, personal or intangible, that secures my performance of the obligations of this Loan.

2.ADVANCES.  Advances under this Agreement are made according to the following terms and conditions.

A.Multiple Advances - Revolving.  In accordance with the terms of this Agreement and other Loan Documents, you will extend to me and I may from time to time borrow, repay, and reborrow, one or more advances.  The amount of advances will not exceed $100,000.00 (Principal).

B.Requests for Advances.  My requests are a warranty that I am in compliance with all the Loan Documents.  When required by you for a particular method of advance, my requests for an advance must specify the requested amount and the date and be accompanied with any agreements, documents, and instruments that you require for the Loan.  Any payment by you of any check, share draft or other charge may, at your option, constitute an advance on the Loan to me.  All advances will be made in United States dollars.  I will indemnify you and hold you harmless for your reliance on any request for advances that you reasonably believe to be genuine.  To the extent permitted by law, I will indemnify you and hold you harmless when the person making any request represents that I authorized this person to request an advance even when this person is unauthorized or this person's signature is not genuine.

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I or anyone I authorize to act on my behalf may request advances by the following methods.

(1)I make a request in person.

(2)I make a request by phone.

(3)I make a request by mail.

C.Advance Limitations.  In addition to any other Loan conditions, requests for, and access to, advances are subject to the following limitations.

(1)Obligatory Advances.  You will make all Loan advances subject to this Agreement's terms and conditions.

(2)Advance Amount.  Subject to the terms and conditions contained in this Agreement, advances will be made in exactly the amount I request.

(3)Cut-Off Time.  Requests for an advance received before 05:00 AM will be made on any day that you are open for business, on the day for which the advance is requested.

(4)Disbursement of Advances.  On my fulfillment of this Agreement's terms and conditions, you will disburse the advance in any manner as you and I agree.

(5)Credit Limit.  I understand that you will not ordinarily grant a request for an advance that would cause the unpaid principal of my Loan to be greater than the Principal limit.  You may, at your option, grant such a request without obligating yourselves to do so in the future.  I will pay any over advances in addition to my regularly scheduled payments.  I will repay any over advance by repaying you in full within 10 days after the overdraft occurs.

(6)Records.  Your records will be conclusive evidence as to the amount of advances, the Loan's unpaid principal balances and the accrued interest.

D.Conditions.  I will satisfy all of the following conditions before you either issue any promissory notes or make any advances under this Agreement.

(1)No Default.  There has not been a default under this Agreement or any other Loan Documents nor would a default result from making the Loan or any advance.

(2)Information.  You have received all documents, information, certifications and warranties as you may require, all properly executed, if appropriate, on forms acceptable to you.

(3)Inspections.  You have made all inspections that you consider necessary and are satisfied with this inspection.

(4)Conditions and Covenants.  Iwill have performed and complied with all conditions required for an advance and all covenants in this Agreement and any other Loan Documents.

(5)Warranties and Representations.  The warranties and representations contained in this Agreement are true and correct at the time of making the requested advance.

(6)Financial Statements.  My most recent financial statements and other financial reports, delivered to you, are current, complete, true and accurate in all material respects and fairly represent my financial condition.

(7)Bankruptcy Proceedings.  No proceeding under the United States Bankruptcy Code has been commenced by or against me or any of my affiliates.

3.DEMAND.  I agree to fully repay the Loan on demand.

4.WARRANTIES AND REPRESENTATIONS.  I make to you the following warranties and representations which will continue as long as this Loan is in effect, except when this Agreement provides otherwise.

A.Power.  I am duly organized, and validly existing and in good standing in all jurisdictions in which I operate.  I have the power and authority to enter into this transaction and to carry on my business or activity as it is now being conducted and, as applicable, am qualified to do so in each jurisdiction in which I operate.

B.Authority.  The execution, delivery and performance of this Loan and the obligation evidenced by the Note are within my powers, have been duly authorized, have received all necessary governmental approval, will not violate any provision of law, or order of court or governmental agency, and will not violate any agreement to which I am a party or to which I am or any of my property is subject.

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C.Name and Place of Business.  Other than previously disclosed in writing to you I have not changed my name or principal place of business within the last 10 years and have not used any other trade or fictitious name.  Without your prior written consent, I do not and will not use any other name and will preserve my existing name, trade names and franchises.

D.Hazardous Substances.  Except as I previously disclosed in writing and you acknowledge in writing, no Hazardous Substance, underground tanks, private dumps or open wells are currently located at, on, in, under or about the Property.

E.Use of Property.  After diligent inquiry, I do not know or have reason to know that any Hazardous Substance has been discharged, leached or disposed of, in violation of any Environmental Law, from the property onto, over or into any other property, or from any other property onto, over or into the property.

F.Environmental Laws.  I have no knowledge or reason to believe that there is any pending or threatened investigation, claim, judgment or order, violation, lien, or other notice under any Environmental Law that concerns me or the property.  The property and any activities on the property are in full compliance with all Environmental Law.

G.Loan Purpose.  The purpose of this Loan is for working capital needs.

H.No Other Liens.  I own or lease all property that I need to conduct my business and activities.  I have good and marketable title to all property that I own or lease.  All of my Property is free and clear of all liens, security interests, encumbrances and other adverse claims and interests, except those to you or those you consent to in writing.

I.Compliance With Laws.  I am not violating any laws, regulations, rules, orders, judgments or decrees applicable to me or my property, except for those which I am challenging in good faith through proper proceedings after providing adequate reserves to fully pay the claim and its challenge should I lose.

5.FINANCIAL STATEMENTS.  I will prepare and maintain my financial records using consistently applied generally accepted accounting principles then in effect.  I will provide you with financial information in a form that you accept and under the following terms.

A.Certification.  I represent and warrant that any financial statements that I provide you fairly represents my financial condition for the stated periods, is current, complete, true and accurate in all material respects, includes all of my direct or contingent liabilities and there has been no material adverse change in my financial condition, operations or business since the date the financial information was prepared.

B.Frequency.  Annually, I will provide to you my financial statements, tax returns, annual internal audit reports or those prepared by independent accountants as soon as available or at least within 105 days after the close of each of my fiscal years.  Any annual financial statements that I provide you will be prepared statements.

C.Requested Information.  I will provide you with any other information about my operations, financial affairs and condition within 10 days after your request.

D.Additional Financial Statements Term.  DURING THE TERM OF THIS LOAN, I/WE WILL PROVIDE THE FOLLOWING INFORMATION WITHIN THE TIME FRAMES OUTLINED:

-ANNUAL SIGNED FEDERAL TAX RETURNS DUE TO THE LENDER NO LATER THAN 105 DAYS FOLLOWING EACH FISCAL YEAR END.  IF AN EXTENSION IS FILED, A COPY OF SAME WILL PROMPTLY BE SUPPLIED TO THE LENDER AND THEN THE SIGNED COPY OF THE TAX RETURN WILL BE DUE TO THE LENDER THE SAME DAY IT IS DUE TO THE IRS.

6.COVENANTS.  Until the Loan and all related debts, liabilities and obligations are paid and discharged, I will comply with the following terms, unless you waive compliance in writing.

A.Participation.  I consent to you participating or syndicating the Loan and sharing any information that you decide is necessary about me and the Loan with the other participants or syndicators.

B.Inspection.  Following your written request, I will immediately pay for all one-time and recurring out-of-pocket costs that are related to the inspection of my records, business or Property that secures the Loan.  Upon reasonable notice, I will permit you or your agents to enter any of my premises and any location where my Property is located during regular business hours to do the following.

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(1)You may inspect, audit, check, review and obtain copies from my books, records, journals, orders, receipts, and any correspondence and other business related data.

(2)You may discuss my affairs, finances and business with any one who provides you with evidence that they are a creditor of mine, the sufficiency of which will be subject to your sole discretion.

(3)You may inspect my Property, audit for the use and disposition of the Property's proceeds and proceeds of proceeds; or do whatever you decide is necessary to preserve and protect the Property and your interest in the Property.

After prior notice to me, you may discuss my financial condition and business operations with my independent accountants, if any, or my chief financial officer and I may be present during these discussions.  As long as the Loan is outstanding, I will direct all of my accountants and auditors to permit you to examine my records in their possession and to make copies of these records.  You will use your best efforts to maintain the confidentiality of the information you or your agents obtain, except you may provide your regulator, if any, with required information about my financial condition, operation and business or that of my parent, subsidiaries or affiliates.

C.Business Requirements.  I will preserve and maintain my present existence and good standing in the jurisdiction where I am organized and all of my rights, privileges and franchises.  I will do all that is needed or required to continue my business or activities as presently conducted, by obtaining licenses, permits and bonds everywhere I engage in business or activities or own, lease or locate my property.  I will obtain your prior written consent before I cease my business or before I engage in any new line of business that is materially different from my present business.

D.Compliance with Laws.  I will not violate any laws, regulations, rules, orders, judgments or decrees applicable to me or my Property, except for those which I challenge in good faith through proper proceedings after providing adequate reserves to fully pay the claim and its appeal should I lose.  Laws include without limitation the Federal Fair Labor Standards Act requirements for producing goods, the federal Employee Retirement Income Security Act of 1974's requirements for the establishment, funding and management of qualified deferred compensation plans for employees, health and safety laws, environmental laws, tax laws, licensing and permit laws.  On your request, I will provide you with written evidence that I have fully and timely paid my taxes, assessments and other governmental charges levied or imposed on me, my income or profits and my property.  Taxes include without limitation sales taxes, use taxes, personal property taxes, documentary stamp taxes, recordation taxes, franchise taxes, income taxes, withholding taxes, FICA taxes and unemployment taxes.  I will adequately provide for the payment of these taxes, assessments and other charges that have accrued but are not yet due and payable.

E.New Organizations.  I will obtain your written consent before organizing, merging into, or consolidating with an entity; acquiring all or substantially all the assets of another; materially changing the legal structure, management, ownership or financial condition; or effecting or entering into a domestication, conversion or interest exchange.

F.Other Liabilities.  I will not incur, assume or permit any debt evidenced by notes, bonds or similar obligations, except: debt in existence on the date of this Agreement and fully disclosed to you; debt subordinated in payment to you on conditions and terms acceptable to you; accounts payable incurred in the ordinary course of my business and paid under customary trade terms or contested in good faith with reserves satisfactory to you.

G.Notice to You.  I will promptly notify you of any material change in my financial condition, of the occurrence of a default under the terms of this Agreement or any other Loan Document, or a default by me under any agreement between me and any third party which materially and adversely affects my property, operations, financial condition or business.

H.Dispose of No Assets.  Without your prior written consent or as the Loan Documents permit, I will not sell, lease, assign, transfer, dispose of or otherwise distribute all or substantially all of my assets to any person other than in the ordinary course of business for the assets' depreciated book value or more.

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I.Insurance.  I will obtain and maintain insurance with insurers, in amounts and coverages that are acceptable to you and customary with industry practice.  This may include without limitation insurance policies for public liability, fire, hazard and extended risk, workers compensation, and, at your request, business interruption and/or rent loss insurance.  At your request, I will deliver to you certified copies of all of these insurance policies, binders or certificates.  I will obtain and maintain a mortgagee clause (or lender loss payable clause) endorsement - naming you as the loss payee.  If you require, I will also obtain an "additional insured" endorsement - naming you as an additional insured.  I will immediately notify you of cancellation or termination of insurance.  I will require all insurance policies to provide you with at least 10 days prior written notice to you of cancellation or modification.  I consent to you using or disclosing information relative to any contract of insurance required by the Loan for the purpose of replacing this insurance.  I also authorize my insurer and you to exchange all relevant information related to any contract of insurance required by any document executed as part of this Loan.

J.Property Maintenance.  I will keep all tangible and intangible property that I consider necessary or useful in my business in good working condition by making all needed repairs, replacements and improvements and by making all rental, lease or other payments due on this property.

K.Property Loss.  I will immediately notify you, and the insurance company when appropriate, of any material casualty, loss or depreciation to the Property or to my other property that affects my business.

L.Additional Taxes.  I will pay all filing and recording costs and fees, including any recordation, documentary or transfer taxes or stamps, that are required to be paid with respect to this Loan and any Loan Documents.

M.Additional Covenants.  DURING THE TERM OF THIS PROMISSORY NOTE, I/WE HEREBY AGREE TO PAY THIS LINE OF CREDIT DOWN TO 10% (PERCENT) OR LESS OF THE COMMITTED LINE AMOUNT FOR AT LEAST THIRTY (30) CONSECUTIVE DAYS DURING EACH TWELVE (12) MONTH PERIOD.

I/WE HEREBY AGREE AND WARRANT THAT AN ANNUAL MINIMUM GLOBAL DEBT SERVICE COVERAGE RATIO (GLOBAL DSCR) OF 1.25X WILL BE MAINTAINED.  THE RATIO WILL BE CALCULATED AS FOLLOWS: (NET INCOME FROM BORROWER AND ALL GUARANTORS + DEPRECIATION + INTEREST EXPENSE + INTANGIBLE AMORTIZATION EXPENSE) DIVIDED BY TOTAL DEBT SERVICE.

BORROWERS AGREE TO ESTABLISH AND MAINTAIN AN OPERATING ACCOUNT WITH SUNSTATE FEDERAL CREDIT UNION FOR THE TERM OF THIS LOAN.

THE OCCURRENCE OF ANY DEFAULT OF THE BORROWER(S) IN PAYMENT OF THIS PROMISSORY NOTE SHALL ALSO CONSTITUTE AN EVENT OF DEFAULT WITH RESPECT TO THE INDEBTEDNESS OF THE BORROWER(S) EVIDENCED BY THAT CERTAIN PROMISSORY NOTE NUMBER 103428-01 DATED MARCH 22, 2011, EXECUTED BY CTD HOLDINGS, INC., IN THE ORIGINAL PRINCIPAL AMOUNT OF $325,000.00, TOGETHER WITH ANY AND ALL EXTENSIONS, RENEWALS, MODIFICATIONS, SUBSTITUTIONS, REPLACEMENTS, AND CHANGES IN FORM THEREOF, WHICH MAY FROM TIME TO TIME AND FOR ANY TERM OR TERMS ARE EFFECTED BY AN AGREEMENT BETWEEN BORROWER(S) AND THE LENDER.

BORROWER HEREBY AGREES AT ANY GIVEN TIME THE OUTSTANDING BALANCE UNDER THIS PROMISSORY NOTE WILL BE LIMITED TO NO MORE THAN 70% OF THE CURRENT OWNED EQUIPMENT VALUE.  ANY AMOUNTS IN EXCESS OF THIS WILL BE PAID DOWN WITHIN 30 (THIRTY) DAYS OF RECEIVING NOTIFICATION OF SAME FROM THE LENDER.

7.COLLECTION EXPENSES AND ATTORNEYS' FEES.  On or after the occurrence of an Event of Default, to the extent permitted by law, I agree to pay all expenses of collection, enforcement or protection of your rights and remedies under this Agreement or any other Loan Document.  Expenses include, but are not limited to, attorneys' fees of 10 percent of the Principal sum due or a larger amount as the court judges as reasonable and just, court costs and other legal expenses.  These expenses are due and payable immediately.  If not paid immediately, these expenses will bear interest from the date of payment until paid in full at the highest interest rate in effect as provided for in the terms of this Loan.  All fees and expenses will be secured by the Property I have granted to you, if any.  In addition, to the extent permitted by the United States Bankruptcy Code, I agree to pay the reasonable attorneys' fees incurred by you to protect your rights and interests in connection with any bankruptcy proceedings initiated by or against me.

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8.APPLICABLE LAW.  This Agreement is governed by the laws of Florida, the United States of America, and to the extent required, by the laws of the jurisdiction where the Property is located, except to the extent such state laws are preempted by federal law.  In the event of a dispute, the exclusive forum, venue and place of jurisdiction will be in Florida, unless otherwise required by law.

9.JOINT AND INDIVIDUAL LIABILITY AND SUCCESSORS.  My obligation to pay the Loan is independent of the obligation of any other person who has also agreed to pay it.  You may sue me alone, or anyone else who is obligated on the Loan, or any number of us together, to collect the Loan.  Extending the Loan or new obligations under the Loan, will not affect my duty under the Loan and I will still be obligated to pay the Loan.  You may assign all or part of your rights or duties under this Agreement or the Loan Documents without my consent.  If you assign this Agreement, all of my covenants, agreements, representations and warranties contained in this Agreement or the Loan Documents will benefit your successors and assigns.  I may not assign this Agreement or any of my rights under it without your prior written consent.  The duties of the Loan will bind my successors and assigns.

10.AMENDMENT, INTEGRATION AND SEVERABILITY.  This Agreement may not be amended or modified by oral agreement.  No amendment or modification of this Agreement is effective unless made in writing and executed by you and me.  This Agreement and the other Loan Documents are the complete and final expression of the understanding between you and me.  If any provision of this Agreement is unenforceable, then the unenforceable provision will be severed and the remaining provisions will still be enforceable.

11.INTERPRETATION.  Whenever used, the singular includes the plural and the plural includes the singular.  The section headings are for convenience only and are not to be used to interpret or define the terms of this Agreement.

12.NOTICE, FINANCIAL REPORTS AND ADDITIONAL DOCUMENTS.  Unless otherwise required by law, any notice will be given by delivering it or mailing it by first class mail to the appropriate party's address listed in the DATE AND PARTIES section, or to any other address designated in writing.  Notice to one Borrower will be deemed to be notice to all Borrowers.  I will inform you in writing of any change in my name, address or other application information.  I will provide you any financial statement or information you request.  All financial statements and information I give you will be correct and complete.  I agree to sign, deliver, and file any additional documents or certifications that you may consider necessary to perfect, continue, and preserve my obligations under this Loan and to confirm your lien status on any Property.  Time is of the essence.

13.WAIVER OF JURY TRIAL.  All of the parties to this Agreement knowingly and intentionally, irrevocably and unconditionally, waive any and all right to a trial by jury in any litigation arising out of or concerning this Agreement or any other Loan Document or related obligation.  All of these parties acknowledge that this section has either been brought to the attention of each party's legal counsel or that each party had the opportunity to do so.

14.SIGNATURES.  By signing, I agree to the terms contained in this Agreement.  I also acknowledge receipt of a copy of this Agreement.

BORROWER:

CTD Holdings, Inc.

By: /s/ Charles E. Strattan                                                    

Charles E. Strattan, President

LENDER:

Sunstate Federal Credit Union

By: /s/ Brian Miller                                                     

Brian Miller, Commercial Loan Officer

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EX-10.8

EXHIBIT 10.8

LOAN NUMBER	LOAN NAME	ACCT. NUMBER	NOTE DATE	INITIALS
103428-02	CTD Holdings, Inc.		03/22/11	BM
NOTE AMOUNT	INDEX (w/Margin)	RATE	MATURITY DATE	LOAN PURPOSE
$100,000.00	Wall Street Journal Prime plus	6.5%	Payable on Demand	Commercial
	2.000%
		Creditor Use Only

PROMISSORY NOTE

(Commercial - Revolving Draw)

State of Florida's Documentary Stamp Tax for this Note required by law in the amount of $350.00 has been paid directly to the Florida Department of Revenue.

Lender's Certificate of Registration is No.59-0808589.

DATE AND PARTIES.  The date of this Promissory Note (Note) is March 22, 2011.  The parties and their addresses are:

LENDER:

SUNSTATE FEDERAL CREDIT UNION

405 SE 2nd Place

Gainesville, FL 32602

Telephone: (352) 381-5200 x5197

BORROWER:

CTD HOLDINGS, INC.

a Florida Corporation

27317 NW 78th Avenue

High Springs, FL 32643

1.DEFINITIONS.  As used in this Note, the terms have the following meanings:

A.Pronouns.  The pronouns "I," "me," and "my" refer to each Borrower signing this Note, individually and together.  "You" and "Your" refer to the Lender.

B.Note.  Note refers to this document, and any extensions, renewals, modifications and substitutions of this Note.

C.Loan.  Loan refers to this transaction generally, including obligations and duties arising from the terms of all documents prepared or submitted for this transaction such as applications, security agreements, disclosures or notes, and this Note.

D.Loan Documents.  Loan Documents refer to all the documents executed as a part of or in connection with the Loan.

E.Property.  Property is any property, real, personal or intangible, that secures my performance of the obligations of this Loan.

F.Percent.  Rates and rate change limitations are expressed as annualized percentages.

2.PROMISE TO PAY.  For value received, I promise to pay you or your order, at your address, or at such other location as you may designate, amounts advanced from time to time under the terms of this Note up to the maximum outstanding principal balance of $100,000.00 (Principal), plus interest from the date of disbursement, on the unpaid outstanding Principal balance until this Note is paid in full and you have no further obligations to make advances to me under the Loan.

I may borrow up to the Principal amount more than one time.

All advances made will be made subject to all other terms and conditions of the Loan.

3.INTEREST.  Interest will accrue on the unpaid Principal balance of this Note at the rate of 6.5 percent (Interest Rate) until March 23, 2011, after which time it may change as described in the Variable Rate subsection.

A.Interest After Default.  If you declare a default under the terms of the Loan, including for failure to pay in full at maturity, you may increase the Interest Rate payable on the outstanding Principal balance of this Note.  In such event, interest may accrue at the maximum amount allowed by law, subject to your sole discretion.

B.Maximum Interest Amount.  Any amount assessed or collected as interest under the terms of this Note will be limited to the maximum lawful amount of interest allowed by state or federal law, whichever is greater.  Amounts collected in excess of the maximum lawful amount will be applied first to the unpaid Principal balance.  Any remainder will be refunded to me.

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C.Accrual.  Interest accrues using an Actual/365 days counting method.

D.Variable Rate.  The Interest Rate may change during the term of this transaction.

(1)Index.  Beginning with the first Change Date, the Interest Rate will be based on the following index: the base rate on corporate loans posted by at least 70% of the 10 largest U.S. banks known as the Wall Street Journal U.S. Prime Rate.

The Current Index is the most recent index figure available on each Change Date.  You do not guaranty by selecting this Index, or the margin, that the Interest Rate on this Note will be the same rate you charge on any other loans or class of loans you make to me or other borrowers.  If this Index is no longer available, you will substitute a similar index.  You will give me notice of your choice.

(2)Change Date.  Each date on which the Interest Rate may change is called a Change Date.  The Interest Rate may change March 23, 2011 and daily thereafter.

(3)Calculation Of Change.  On each Change Date you will calculate the Interest Rate, which will be the Current Index plus 2,000 percent.  The result of this calculation will be rounded up to the nearest .01 percent.  Subject to any limitations, this will be the Interest Rate until the next Change Date.  The new Interest Rate will become effective on each Change Date.  The Interest Rate and other charges on this Note will never exceed the highest rate or charge allowed by law for this Note.

(4)Limitations.  The Interest Rate changes are subject to the following limitations:

(a)Lifetime.  The Interest Rate will never be less than 6.500 percent.

(5)Effect Of Variable Rate.  A change in the Interest Rate will have the following effect on the payments: The amount of scheduled payments will change.

4.ADDITIONAL CHARGES.  As additional consideration, I agree to pay, or have paid, these additional fees and charges.

A.Nonrefundable Fees and Charges.  The following fees are earned when collected and will not be refunded if I prepay this Note before the scheduled maturity date.

Loan.  A(n) Loan fee of $750.00 payable from separate funds on or before today's date.

Florida Doc Stamp.  A(n) Florida Doc Stamp fee of $350.00 payable from separate funds on or before today's date.

Filing.  A(n) Filing fee of $38.00 payable from separate funds on or before today's date.

5.REMEDIAL CHARGES.  In addition to interest or other finance charges, I agree that I will pay these additional fees based on my method and pattern of payment.  Additional remedial charges may be described elsewhere in this Note.

A.Late Charge.  If a payment is more than 10 days late, I will be charged 10.000 percent of the Amount of Payment.  I will pay this late charge promptly but only once for each late payment.

6.GOVERNING AGREEMENT.  This Note is further governed by the Commercial Loan Agreement executed between you and me as a part of this Loan, as modified, amended or supplemented.  The Commercial Loan Agreement states the terms and conditions of this Note, including the terms and conditions under which the maturity of this Note may be accelerated.  When I sign this Note, I represent to you that I have reviewed and am in compliance with the terms contained in the Commercial Loan Agreement.

7.PAYMENT.  I agree to pay this Note on demand.  Upon your demand the entire unpaid balance of Principal and accrued interest, along with any earned, and unpaid fees or charges, and the amount of any advances made on my behalf, will be due and owing.  In addition, I agree to make the following payments: monthly payments of accrued interest only, beginning April 18, 2011 and on the 18th day of each month thereafter.

Payments will be rounded to the nearest $.01.  With the final payment I also agree to pay any additional fees or charges owing and the amount of any advances you have made to others on my behalf.  Payments scheduled to be paid on the 29th, 30th or 31st day of a month that contains no such day will, instead, be made on the last day of such month.

8.PREPAYMENT.  I may prepay this Loan in full or in part at any time.  Any partial prepayment will not excuse any later scheduled payments until I pay in full.

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9.LOAN PURPOSE.  The purpose of this Loan is for working capital needs.

10.ADDITIONAL TERMS.  DURING THE TERM OF THIS PROMISSORY NOTE, I/WE HEREBY AGREE TO PAY THIS LINE OF CREDIT DOWN TO 10% (PERCENT) OR LESS OF THE COMMITTED LINE AMOUNT FOR AT LEAST THIRTY (30) CONSECUTIVE DAYS DURING EACH TWELVE (12) MONTH PERIOD.

THE OCCURRENCE OF ANY DEFAULT OF THE BORROWER(S) IN PAYMENT OF THIS PROMISSORY NOTE SHALL ALSO CONSTITUTE AN EVENT OF DEFAULT WITH RESPECT TO THE INDEBTEDNESS OF THE BORROWER(S) EVIDENCED BY THAT CERTAIN PROMISSORY NOTE NUMBER 103428-01 DATED MARCH 22, 2011, EXECUTED BY CTD HOLDINGS, INC., IN THE ORIGINAL PRINCIPAL AMOUNT OF $325,000.00, TOGETHER WITH ANY AND ALL EXTENSIONS, RENEWALS, MODIFICATIONS, SUBSTITUTIONS, REPLACEMENTS, AND CHANGES IN FORM THEREOF, WHICH MAY FROM TIME TO TIME AND FOR ANY TERM OR TERMS ARE EFFECTED BY AN AGREEMENT BETWEEN BORROWER(S) AND THE LENDER.

11.SECURITY.  The Loan is secured by separate security instruments prepared together with this Note as follows:

Document Name Parties to Document

Security Agreement - CTD Holdings, Inc.CTD Holdings, Inc.

12.DUE ON SALE OR ENCUMBRANCE.  You may, at your option, declare the entire balance of this Note to be immediately due and payable upon the creation of, or contract for the creation of, any lien, encumbrance, transfer or sale of all or any part of the Property.  This right is subject to the restrictions imposed by federal law (12 C.F.R. 591), as applicable.  However, if I am in default under this Agreement, I may not sell the inventory portion of the Property even in the ordinary course of business.

13.WAIVERS AND CONSENT.  To the extent not prohibited by law, I waive protest, presentment for payment, demand, notice of acceleration, notice of intent to accelerate and notice of dishonor.

A.Additional Waivers By Borrower.  In addition, I, and any party to this Note and Loan, to the extent permitted by law, consent to certain actions you may take, and generally waive defenses that may be available based on these actions or based on the status of a party to this Note.

(1)You may renew or extend payments on this Note, regardless of the number of such renewals or extensions.

(2)You may release any Borrower, endorser, guarantor, surety, accommodation maker or any other co-signer.

(3)You may release, substitute or impair any Property securing this Note.

(4)You, or any institution participating in this Note, may invoke your right of set-off.

(5)You may enter into any sales, repurchases or participations of this Note to any person in any amounts and I waive notice of such sales, repurchases or participations.

(6)I agree that any of us signing this Note as a Borrower is authorized to modify the terms of this Note or any instrument securing, guarantying or relating to this Note.

(7)I agree that you may inform any party who guarantees this Loan of any Loan accommodations, renewals, extensions, modifications, substitutions or future advances.

B.No Waiver By Lender.  Your course of dealing, or your forbearance from, or delay in, the exercise of any of your rights, remedies, privileges or right to insist upon my strict performance of any provisions contained in this Note, or any other Loan Document, shall not be construed as a waiver by you, unless any such waiver is in writing and is signed by you.

14.COMMISSIONS.  I understand and agree that you (or your affiliate) will earn commissions or fees on any insurance products, and may earn such fees on other services that I buy through you or your affiliate.

15.APPLICABLE LAW.  This Note is governed by the laws of Florida, the United States of America, and to the extent required, by the laws of the jurisdiction where the Property is located, except to the extent such state laws are preempted by federal law.  In the event of a dispute, the exclusive forum, venue and place of jurisdiction will be in Florida, unless otherwise required by law.

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16.JOINT AND INDIVIDUAL LIABILITY AND SUCCESSORS.  My obligation to pay the Loan is independent of the obligation of any other person who has also agreed to pay it.  You may sue me alone, or anyone else who is obligated on the Loan, or any number of us together, to collect the Loan.  Extending the Loan or new obligations under the Loan, will not affect my duty under the Loan and I will still be obligated to pay the Loan.  This Note shall inure to the benefit of and be enforceable by you and your successors and assigns and shall be binding upon and enforceable against me and my personal representatives, successors, heirs and assigns.

17.AMENDMENT, INTEGRATION AND SEVERABILITY.  This Note may not be amended or modified by oral agreement.  No amendment or modification of this Note is effective unless made in writing and executed by you and me.  This Note and the other Loan Documents are the complete and final expression of the agreement.  If any provision of this Note is unenforceable, then the unenforceable provision will be severed and the remaining provisions will still be enforceable.  No present or future agreement securing any other debt I owe you will secure the payment of this Loan if, with respect to this loan, you fail to fulfill any necessary requirements or limitations of Sections 19(a), 32 or 35 of Regulation Z or if, as a result, this Loan would become subject to Section 670 of the John Warner National Defense Authorization Act for Fiscal Year 2007.

18.INTERPRETATION.  Whenever used, the singular includes the plural and the plural includes the singular.  The section headings are for convenience only and are not to be used to interpret or define the terms of this Note.

19.NOTICE, FINANCIAL REPORTS AND ADDITIONAL DOCUMENTS.  Unless otherwise required by law, any notice will be given by delivering it or mailing it by first class mail to the appropriate party's address listed in the DATE AND PARTIES section, or to any other address designated in writing.  Notice to one Borrower will be deemed to be notice to all Borrowers.  I will inform you in writing of any change in my name, address or other application information.  I agree to sign, deliver, and file any additional documents or certifications that you may consider necessary to perfect, continue, and preserve my obligations under this Loan and to confirm your lien status on any Property.  Time is of the essence.

20.CREDIT INFORMATION.  I agree to supply you with whatever information you reasonably feel you need to decide whether to continue this Loan.  You will make requests for this information without undue frequency, and will give me reasonable time in which to supply the information.

21.ERRORS AND OMISSIONS.  I agree, if requested by you, to fully cooperate in the correction, if necessary, in the reasonable discretion of you of any and all loan closing documents so that all documents accurately describe the loan between you and me.  I agree to assume all costs including by way of illustration and not limitation, actual expenses, legal fees and marketing losses for failing to reasonably comply with your requests within thirty (30) days.

22.WAIVER OF JURY TRIAL.  All of the parties to this Note knowingly and intentionally, irrevocably and unconditionally, waive any and all right to a trial by jury in any litigation arising out of or concerning this Note or any other Loan Document or related obligation.  All of these parties acknowledge that this section has either been brought to the attention of each party's legal counsel or that each party had the opportunity to do so.

23.SIGNATURES.  By signing, I agree to the terms contained in this Note.  I also acknowledge receipt of a copy of this Note.

BORROWER:

CTD Holdings, Inc.

By: /s/ Charles E. Strattan                             

Charles E. Strattan, President

LENDER:

Sunstate Federal Credit Union

By: /s/ Brian Miller                                                                

Brian Miller, Commercial Loan Officer

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EX-10.9

EXHIBIT 10.9

SECURITY AGREEMENT

DATE AND PARTIES. The date of this Security Agreement (Agreement) is March 22, 2011. The parties and their addresses are:

SECURED PARTY:

SUNSTATE FEDERAL CREDIT UNION

405 SE 2nd Place

Gainesville, FL 32602

DEBTOR:

CTD HOLDINGS, INC.

a Florida Corporation

27317 NW 78th Avenue

High Springs, FL 32643

The pronouns "you" and "your" refer to the Secured Party.  The pronouns "I," "me" and "my" refer to each person or entity signing this Agreement as Debtor and agreeing to give the Property described in this Agreement as security for the Secured Debts.

1.SECURED DEBTS.  The term "Secured Debts" includes and this Agreement will secure each of the following:

A.Specific Debts.  The following debts and all extensions, renewals, refinancings, modifications and replacements.  A promissory note or other agreement, No.  103428-02, dated March 22, 2011, from me to you, in the amount of $100,000.00.

B.All Debts.  All present and future debts from me to you, even if this Agreement is not specifically referenced, the future debts are also secured by other collateral, or if the future debt is unrelated to or of a different type than this debt.  If more than one person signs this Agreement, each agrees that it will secure debts incurred either individually or with others who may not sign this Agreement.  Nothing in this Agreement constitutes a commitment to make additional or future loans or advances.  Any such commitment must be in writing.

This Agreement will not secure any debt for which you fail to give any required notice of the right of rescission.  This Agreement will not secure any debt for which a non-possessory, non-purchase money security interest is created in "household goods" in connection with a "consumer loan," as those terms are defined by federal law governing unfair and deceptive credit practices.  In addition, this Agreement will not secure any other debt if, with respect to such other debt, you fail to fulfill any necessary requirements or limitations of Sections 19(a), 32 or 35 of Regulation Z or if, as a result, the other debt would become subject to Section 670 of the John Warner National Defense Authorization Act for Fiscal Year 2007.

C.Sums Advanced.  All sums advanced and expenses incurred by you under the terms of this Agreement.

Loan Documents refer to all the documents executed in connection with the Secured Debts.

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2.SECURITY INTEREST.  To secure the payment and performance of the Secured Debts, I give you a security interest in all of the Property described in this Agreement that I own or have sufficient rights in which to transfer an interest, now or in the future, wherever the Property is or will be located, and all proceeds and products from the Property (including, but not limited to, all parts, accessories, repairs, replacements, improvements, and accessions to the Property).  Property is all the collateral given as security for the Secured Debts and described in this Agreement, and includes all obligations that support the payment or performance of the Property.  "Proceeds" includes cash proceeds, non-cash proceeds and anything acquired upon the sale, lease, license, exchange, or other disposition of the Property; any rights and claims arising from the Property; and any collections and distributions on account of the Property.

This Agreement remains in effect until terminated in writing, even if the Secured Debts are paid and you are no longer obligated to advance funds to me under any loan or credit agreement.

3.PROPERTY DESCRIPTION.  The Property is described as follows:

A.Inventory.  All inventory which I hold for ultimate sale or lease, or which has been or will be supplied under contracts of service, or which are raw materials, work in process, or materials used or consumed in my business.

B.Accounts and Other Rights to Payment.  All rights I have now or in the future to payments including, but not limited to, payment for property or services sold, leased, rented, licensed, or assigned, whether or not I have earned such payment by performance.  This includes any rights and interests (including all liens and security interests) which I may have by law or agreement against any Account Debtor or obligor of mine.

C.General Intangibles.  All general intangibles including, but not limited to, tax refunds, applications for patents, patents, copyrights, trademarks, trade

secrets, good will, trade names, customer lists, permits and franchises, payment intangibles, computer programs and all supporting information provided in connection with a transaction relating to computer programs, and the right to use my name.

D.Equipment.  All equipment including, but not limited to, all machinery, vehicles, furniture, fixtures, manufacturing equipment, farm machinery and equipment, shop equipment, office and recordkeeping equipment, and parts and tools.  All equipment described in a list or schedule which I give to you will also be included in the Property, but such a list is not necessary for a valid security interest in my equipment.

4.WARRANTIES AND REPRESENTATIONS.  I make to you the following warranties and representations which will continue as long as this Agreement is in effect:

A.Power.  I am duly organized, and validly existing and in good standing in all jurisdictions in which I operate.  I have the power and authority to enter into this transaction and to carry on my business or activity as it is now being conducted and, as applicable, am qualified to do so in each jurisdiction in which I operate.

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B.Authority.  The execution, delivery and performance of this Agreement and the obligation evidenced by this Agreement are within my powers, have been duly authorized, have received all necessary governmental approval, will not violate any provision of law, or order of court or governmental agency, and will not violate any agreement to which I am a party or to which I am or any of my property is subject.

C.Name and Location.  My name indicated in the DATE AND PARTIES section is my exact legal name.  I am an entity organized and registered under the laws of Florida.  I will provide verification of registration and location upon your request.  I will provide you with at least 30 days notice prior to any change in my name, address, or state of organization or registration.

D.Business Name.  Other than previously disclosed in writing to you I have not changed my name or principal place of business within the last 10 years and have not used any other trade or fictitious name.  Without your prior written consent, I do not and will not use any other name and will preserve my existing name, trade names and franchises.

E.Ownership of Property.  I represent that I own all of the Property.  Your claim to the Property is ahead of the claims of any other creditor, except as disclosed in writing to you prior to any advance on the Secured Debts.  I represent that I am the original owner of the Property and, if I am not, that I have provided you with a list of prior owners of the Property.

5.DUTIES TOWARD PROPERTY.

A.Protection of Secured Party's Interest.  I will defend the Property against any other claim.  I agree to do whatever you require to protect your security interest and to keep your claim in the Property ahead of the claims of other creditors.  I will not do anything to harm your position.

I will keep books, records and accounts about the Property and my business in general.  I will let you examine these and make copies at any reasonable time.  I will prepare any report or accounting you request which deals with the Property.

B.Use, Location, and Protection of the Property.  I will keep the Property in my possession and in good repair.  I will use it only for commercial purposes.  I will not change this specified use without your prior written consent.  You have the right of reasonable access to inspect the Property and I will immediately inform you of any loss or damage to the Property.  I will not cause or permit waste to the Property.

I will keep the Property at my address listed in the DATE AND PARTIES section unless we agree I may keep it at another location.  If the Property is to be used in other states, I will give you a list of those states.  The location of the Property is given to aid in the identification of the Property.  It does not in any way limit the scope of the security interest granted to you.  I will notify you in writing and obtain your prior written consent to any change in location of any of the Property.  I will not use the Property in violation of any law.  I will notify you in writing prior to any change in my address, name or, if an organization, any change in my identity or structure.

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Until the Secured Debts are fully paid and this Agreement is terminated, I will not grant a security interest in any of the Property without your prior written consent.  I will pay all taxes and assessments levied or assessed against me or the Property and provide timely proof of payment of these taxes and assessments upon request.

C.Selling, Leasing or Encumbering the Property.  I will not sell, offer to sell, lease, or otherwise transfer or encumber the Property without your prior written permission, except for Inventory sold in the ordinary course of business at fair market value, or at a minimum price established between you and me.  If I am in default under this Agreement, I may not sell the Inventory portion of the Property even in the ordinary course of business.  Any disposition of the Property contrary to this Agreement will violate your rights.  Your permission to sell the Property may be reasonably withheld without regard to the creditworthiness of any buyer or transferee.  I will not permit the Property to be the subject of any court order affecting my rights to the Property in any action by anyone other than you.  If the Property includes chattel paper or instruments, either as original collateral or as proceeds of the Property, I will note your security interest on the face of the chattel paper or instruments.

D.Additional Duties Specific to Accounts.  I will not settle any Account for less than its full value without your written permission.  Until you tell me otherwise, I will collect all Accounts in the ordinary course of business.  I will not dispose of the Accounts by assignment without your prior written consent.  I will keep the proceeds from all the Accounts and any goods which are returned to me or which I take back.  I will not commingle them with any of my other property.  I will deliver the Accounts to you at your request.  If you ask me to pay you the full price on any returned items or items retaken by me, I will do so.  I will make no material change in the terms of any Account, and I will give you any statements, reports, certificates, lists of Account Debtors (showing names, addresses and amounts owing), invoices applicable to each Account, and other data in any way pertaining to the Accounts as you may request.

6.INSURANCE.  I agree to keep the Property insured against the risks reasonably associated with the Property.  I will maintain this insurance in the amounts you require.  This insurance will last until the Property is released from this Agreement.  I may choose the insurance company, subject to your approval, which will not be unreasonably withheld.

I will have the insurance company name you as loss payee on any insurance policy.  I will give you and the insurance company immediate notice of any loss.  You may apply the insurance proceeds toward what is owed on the Secured Debts.  You may require added security as a condition of permitting any insurance proceeds to be used to repair or replace the Property.

If you acquire the Property in damaged condition, my right to any insurance policies and proceeds will pass to you to the extent of the Secured Debts.

Page 4

I will immediately notify you of cancellation or termination of insurance.  If I fail to keep the Property insured, you may obtain insurance to protect your interest in the Property and I will pay for the insurance on your demand.  You may demand that I pay for the insurance all at once, or you may add the insurance premiums to the balance of the Secured Debts and charge interest on it at the rate that applies to the Secured Debts.  This insurance may include coverages not originally required of me, may be written by a company other than one I would choose, and may be written at a higher rate than I could obtain if I purchased the insurance.  I acknowledge and agree that you or one of your affiliates may receive commissions on the purchase of this insurance.

7.COLLECTION RIGHTS OF THE SECURED PARTY.  Account Debtor means the person who is obligated on an account, chattel paper, or general intangible.  I authorize you to notify my Account Debtors of your security interest and to deal with the Account Debtors' obligations at your discretion.  You may enforce the obligations of an Account Debtor, exercising any of my rights with respect to the Account Debtors' obligations to make payment or otherwise render performance to me, including the enforcement of any security interest that secures such obligations.  You may apply proceeds received from the Account Debtors to the Secured Debts or you may release such proceeds to me.

I specifically and irrevocably authorize you to exercise any of the following powers at my expense, without limitation, until the Secured Debts are paid in full:

A.demand payment and enforce collection from any Account Debtor or Obligor by suit or otherwise.

B.enforce any security interest, lien or encumbrance given to secure the payment or performance of any Account Debtor or any obligation constituting Property.

C.file proofs of claim or similar documents in the event of bankruptcy, insolvency or death of any person obligated as an Account Debtor.

D.compromise, release, extend, or exchange any indebtedness of an Account Debtor.

E.take control of any proceeds of the Account Debtors' obligations and any returned or repossessed goods.

F.endorse all payments by any Account Debtor which may come into your possession as payable to me.

G.deal in all respects as the holder and owner of the Account Debtors' obligations.

8.AUTHORITY TO PERFORM.  I authorize you to do anything you deem reasonably necessary to protect the Property, and perfect and continue your security interest in the Property.  If I fail to perform any of my duties under this Agreement or any other Loan Document, you are authorized, without notice to me, to perform the duties or cause them to be performed.

Page 5

These authorizations include, but are not limited to, permission to:

A.pay and discharge taxes, liens, security interests or other encumbrances at any time levied or placed on the Property.

B.pay any rents or other charges under any lease affecting the Property.

C.order and pay for the repair, maintenance and preservation of the Property.

D.file any financing statements on my behalf and pay for filing and recording fees pertaining to the Property.

E.place a note on any chattel paper indicating your interest in the Property.                                                                                                                     .

F.take any action you feel necessary to realize on the Property, including performing any part of a contract or endorsing it in my name.

G.handle any suits or other proceedings involving the Property in my name.

H.prepare, file, and sign my name to any necessary reports or accountings.

I.make an entry on my books and records showing the existence of this Agreement.

J.notify any Account Debtor of your interest in the Property and tell the Account Debtor to make payments to you or someone else you name.

If you perform for me, you will use reasonable care.  If you exercise the care and follow the procedures that you generally apply to the collection of obligations owed to you, you will be deemed to be using reasonable care.  Reasonable care will not include: any steps necessary to preserve rights against prior parties; the duty to send notices, perform services or take any other action in connection with the management of the Property; or the duty to protect, preserve or maintain any security interest given to others by me or other parties.  Your authorization to perform for me will not create an obligation to perform and your failure to perform will not preclude you from exercising any other rights under the law or this Agreement.  All cash and non-cash proceeds of the Property may be applied by you only upon your actual receipt of cash proceeds against such of the Secured Debts, matured or unmatured, as you determine in your sole discretion.

If you come into actual or constructive possession of the Property, you will preserve and protect the Property.  For purposes of this paragraph, you will be in actual possession of the Property only when you have physical, immediate and exclusive control over the Property and you have affirmatively accepted that control.  You will be in constructive possession of the Property only when you have both the power and the intent to exercise control over the Property.

9.DEFAULT.  I will be in default if any of the following events (known separately and collectively as an Event of Default) occur:

A.Payments.  I fail to make a payment in full when due.

Page 6

B.Insolvency or Bankruptcy.  The death, dissolution or insolvency of, appointment of a receiver by or on behalf of, application of any debtor relief law, the assignment for the benefit of creditors by or on behalf of, the voluntary or involuntary termination of existence by, or the commencement of any proceeding under any present or future federal or state insolvency, bankruptcy, reorganization, composition or debtor relief law by or against me, Obligor, or any co­signer, endorser, surety or guarantor of this Agreement or any other obligations Obligor has with you.

C.Business Termination.  I merge, dissolve, reorganize, end my business or existence, or a partner or majority owner dies or is declared legally incompetent.

D.Failure to Perform.  I fail to perform any condition or to keep any promise or covenant of this Agreement.

E.Other Documents.  A default occurs under the terms of any other Loan Document.

F.Other Agreements.  I am in default on any other debt or agreement I have with you.

G.Misrepresentation.  I make any verbal or written statement or provide any financial information that is untrue, inaccurate, or conceals a material fact at the time it is made or provided.

H.Judgment.  I fail to satisfy or appeal any judgment against me.

I.Forfeiture.  The Property is used in a manner or for a purpose that threatens confiscation by a legal authority.

J.Name Change.  I change my name or assume an additional name without notifying you before making such a change.

K.Property Transfer.  I transfer all or a substantial part of my money or property.

L.Property Value.  You determine in good faith that the value of the Property has declined or is impaired.

M.Material Change.  Without first notifying you, there is a material change in my business, including ownership, management, and financial conditions.

N.Insecurity.  You determine in good faith that a material adverse change has occurred in my financial condition from the conditions set forth in my most recent financial statement before the date of this Agreement or that the prospect for payment or performance of the Secured Debts is impaired for any reason.

10.DUE ON SALE OR ENCUMBRANCE.  You may, at your option, declare the entire balance of this Agreement to be immediately due and payable upon the creation of, or contract for the creation of, any lien, encumbrance, transfer or sale of all or any part of the Property.  This right is subject to the restrictions imposed by federal law (12 C.F.R.  591), as applicable.  However, if I am in default under this Agreement, I may not sell the inventory portion of the Property even in the ordinary course of business.

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11.REMEDIES.  After I default, you may at your option do any one or more of the following.

A.Acceleration.  You may make all or any part of the amount owing by the terms of the Secured Debts immediately due.

B.Sources.  You may use any and all remedies you have under state or federal law or in any Loan Document.

C.Insurance Benefits.  You may make a claim for any and all insurance benefits or refunds that may be available on my default.

D.Payments Made On My Behalf.  Amounts advanced on my behalf will be immediately due and may be added to the Secured Debts.

E.Assembly of Property.  You may require me to gather the Property and make it available to you in a reasonable fashion.

F.Repossession.  You may repossess the Property so long as the repossession does not involve a breach of the peace.  You may sell, lease or otherwise dispose of the Property as provided by law.  You may apply what you receive from the disposition of the Property to your expenses, your attorneys' fees and legal expenses (where not prohibited by law), and any debt I owe you.  If what you receive from the disposition of the Property does not satisfy the debt, I will be liable for the deficiency (where permitted by law).  In some cases, you may keep the Property to satisfy the debt.

Where a notice is required, I agree that ten days prior written notice sent by first class mail to my address listed in this Agreement will be reasonable notice to me under the Florida Uniform Commercial Code.  If the Property is perishable or threatens to decline speedily in value, you may, without notice to me, dispose of any or all of the Property in a commercially reasonable manner at my expense following any commercially reasonable preparation or processing.

If any items not otherwise subject to this Agreement are contained in the Property when you take possession, you may hold these items for me at my risk and you will not be liable for taking possession of them.

G.Use and Operation.  You may enter upon my premises and take possession of all or any part of my property for the purpose of preserving the Property or its value, so long as you do not breach the peace.  You may use and operate my property for the length of time you feel is necessary to protect your interest, all without payment or compensation to me.

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H.Waiver.  By choosing any one or more of these remedies you do not give up your right to use any other remedy.  You do not waive a default if you choose not to use a remedy.  By electing not to use any remedy, you do not waive your right to later consider the event a default and to use any remedies if the default continues or occurs again.

12.WAIVER OF CLAIMS.  I waive all claims for loss or damage caused by your acts or omissions where you acted reasonably and in good faith.

13.ADDITIONAL TERMS.  THE OCCURRENCE OF ANY DEFAULT OF THE BORROWER(S) IN PAYMENT OF THIS PROMISSORY NOTE SHALL ALSO CONSTITUTE AN EVENT OF DEFAULT WITH RESPECT TO THE INDEBTEDNESS OF THE BORROWER(S) EVIDENCED BY THAT CERTAIN PROMISSORY NOTE NUMBER 103428-01 DATED MARCH 22, 2011, EXECUTED BY CTD HOLDINGS, INC., IN THE ORIGINAL PRINCIPAL AMOUNT OF $325,000.00, TOGETHER WITH ANY AND ALL EXTENSIONS, RENEWALS, MODIFICATIONS, SUBSTITUTIONS, REPLACEMENTS, AND CHANGES IN FORM THEREOF, WHICH MAY FROM TIME TO TIME AND FOR ANY TERM OR TERMS ARE EFFECTED BY AN AGREEMENT BETWEEN BORROWER(S) AND THE LENDER.

14.PERFECTION OF SECURITY INTEREST AND COSTS.  I authorize you to file a financing statement and/or security agreement, as appropriate, covering the Property.  I will comply with, facilitate, and otherwise assist you in connection with obtaining perfection or control over the Property for purposes of perfecting your security interest under the Uniform Commercial Code.  I agree to pay all taxes, fees and costs you pay or incur in connection with preparing, filing or recording any financing statements or other security interest filings on the Property.  I agree to pay all actual costs of terminating your security interest.

15.APPLICABLE LAW.  This Agreement is governed by the laws of Florida, the United States of America, and to the extent required, by the laws of the jurisdiction where the Property is located, except to the extent such state laws are preempted by federal law.  In the event of a dispute, the exclusive forum, venue and place of jurisdiction will be in Florida, unless otherwise required by law.

16.JOINT AND INDIVIDUAL LIABILITY AND SUCCESSORS.  Each Debtor's obligations under this Agreement are independent of the obligations of any other Debtor.  You may sue each Debtor individually or together with any other Debtor.  You may release any part of the Property and I will still be obligated under this Agreement for the remaining Property.  Debtor agrees that you and any party to this Agreement may extend, modify or make any change in the terms of this Agreement or any evidence of debt without Debtor's consent.  Such a change will not release Debtor from the terms of this Agreement.  If you assign any of the Secured Debts, you may assign all or any part of this Agreement without notice to me or my consent, and this Agreement will inure to the benefit of your assignee to the extent of such assignment.  You will continue to have the unimpaired right to enforce this Agreement as to any of the Secured Debts that are not assigned.  This Agreement shall inure to the benefit of and be enforceable by you and your successors and assigns and any other person to whom you may grant an interest in the Secured Debts and shall be binding upon and enforceable against me and my personal representatives, successors, heirs and assigns.

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17.AMENDMENT, INTEGRATION AND SEVERABILITY.  This Agreement may not be amended or modified by oral agreement.  No amendment or modification of this Agreement is effective unless made in writing and executed by you and me.  This Agreement and the other Loan Documents are the complete and final expression of the understanding between you and me.  If any provision of this Agreement is unenforceable, then the unenforceable provision will be severed and the remaining provisions will still be enforceable.

18.INTERPRETATION.  Whenever used, the singular includes the plural and the plural includes the singular.  The section headings are for convenience only and are not to be used to interpret or define the terms of this Agreement.

19.NOTICE, FINANCIAL REPORTS AND ADDITIONAL DOCUMENTS.  Unless otherwise required by law, any notice will be given by delivering it or mailing it by first class mail to the appropriate party's address listed in the DATE AND PARTIES section, or to any other address designated in writing.  Notice to one Debtor will be deemed to be notice to all Debtors.  I will inform you in writing of any change in my name, address or other application information.  I will provide you any financial statement or information you request.  All financial statements and information I give you will be correct and complete.  I agree to sign, deliver, and file any additional documents or certifications that you may consider necessary to perfect, continue, and preserve my obligations under this Agreement and to confirm your lien status on any Property.  Time is of the essence.

20.WAIVER OF JURY TRIAL.  All of the parties to this Agreement knowingly and intentionally, irrevocably and unconditionally, waive any and all right to a trial by jury in any litigation arising out of or concerning this Agreement or any other Loan Document or related obligation.  All of these parties acknowledge that this section has either been brought to the attention of each party's legal counsel or that each party had the opportunity to do so.

SIGNATURES.  By signing, I agree to the terms contained in this Agreement.  I also acknowledge receipt of a copy of this Agreement.

DEBTOR:

CTD Holdings, Inc.

By: /s/ Charles E. Strattan                            

Charles E. Strattan, President

SECURED PARTY:

Sunstate Federal Credit Union

By: /s/ Brian Miller                                                                

Brian Miller, Commercial Loan Officer

Page 10

EX-10.10

EXHIBIT 10.10

GUARANTY

(Continuing Debt - Unlimited)

DATE AND PARTIES.  The date of this Guaranty is March 22, 2011.  The parties and their addresses are:

LENDER:

SUNSTATE FEDERAL CREDIT UNION

405 SE 2nd Place

Gainesville, FL 32602

BORROWER:

CTD HOLDINGS, INC.

a Florida Corporation

27317 NW 78th Avenue

High Springs, FL 32643

GUARANTOR:

CHARLES E. STRATTAN

4123 NW 46th Avenue

Gainesville, FL 32606

1.DEFINITIONS.  As used in this Guaranty, the terms have the following meanings:

A.Pronouns.  The pronouns "I", "me" and "my" refer to all persons or entities signing this Guaranty, individually and together.  "You" and "your" refer to the Lender.

B.Note.  "Note" refers to the document that evidences the Borrower's indebtedness, and any extensions, renewals, modifications and substitutions of the Note.

C.Property.  "Property" means any property, real, personal or intangible, that secures performance of the obligations of the Note, Debt, or this Guaranty.

2.SPECIFIC AND FUTURE DEBT GUARANTY.  For good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and to induce you, at your option, to make loans or engage in any other transactions with the Borrower from time to time, I absolutely and unconditionally agree to all terms of and guaranty to you the payment and performance of each and every Debt, of every type, purpose and description that the Borrower either individually, among all or a portion of themselves, or with others, may now or at any time in the future owe you, including, but not limited to the following described Debt(s) including without limitation, all principal, accrued interest, attorneys' fees and collection costs, when allowed by law, that may become due from the Borrower to you in collecting and enforcing the Debt and all other agreements with respect to the Borrower.

A promissory note or other agreement, No. 103428-02, dated March 22, 2011, from CTD Holdings, Inc. (Borrower) to you, in the amount of $100,000.00.

In addition, Debt refers to debts, liabilities, and obligations of the Borrower (including, but not limited to, amounts agreed to be paid under the terms of any notes or agreements securing the payment of any debt, loan, liability or obligation, overdrafts, letters of credit, guaranties, advances for taxes, insurance, repairs and storage, and all extensions, renewals, refinancings and modifications of these debts) whether now existing or created or incurred in the future, due or to become due, or absolute or contingent, including obligations and duties arising from the terms of all documents prepared or submitted for the transaction such as applications, security agreements, disclosures, and the Note.

You may, without notice, apply this Guaranty to such Debt of the Borrower as you may select from time to time.

3.EXTENSIONS.  I consent to all renewals, extensions, modifications and substitutions of the Debt which may be made by you upon such terms and conditions as you may see fit from time to time without further notice to me and without limitation as to the number of renewals, extensions, modifications or substitutions.

A.Future Advances.  I waive notice of and consent to any and all future advances made to the Borrower by you.

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4.UNCONDITIONAL LIABILITY.  I am unconditionally liable under this Guaranty, regardless of whether or not you pursue any of your remedies against the Borrower, against any other maker, surety, guarantor or endorser of the Debt or against any Property.  You may sue me alone, or anyone else who is obligated on this Guaranty, or any number of us together, to collect the Debt.  My liability is not conditioned on the signing of this Guaranty by any other person and further is not subject to any condition not expressly set forth in this Guaranty or any instrument executed in connection with the Debt.  My obligation to pay according to the terms of this Guaranty shall not be affected by the illegality, invalidity or unenforceability of any notes or agreements evidencing the Debt, the violation of any applicable usury laws, forgery, or any other circumstances which make the indebtedness unenforceable against the Borrower.  I will remain obligated to pay on this Guaranty even if any other person who is obligated to pay the Debt, including the Borrower, has such obligation discharged in bankruptcy, foreclosure, or otherwise discharged by law.

5.BANKRUPTCY.  If a bankruptcy petition should at any time be filed by or against the Borrower, the maturity of the Debt, so far as my liability is concerned, shall be accelerated and the Debt shall be immediately payable by me.  I acknowledge and agree that this Guaranty, and the Debt secured hereby, will remain in full force and effect at all times, notwithstanding any action or undertakings by, or against, you or against any Property, in connection with any obligation in any proceeding in the United States Bankruptcy Courts.  Such action or undertaking includes, without limitation, valuation of Property, election of remedies or imposition of secured or unsecured claim status upon claims by you, pursuant to the United States Bankruptcy Code, as amended.  In the event that any payment of principal or interest received and paid by any other guarantor, borrower, surety, endorser or co-maker is deemed, by final order of a court of competent jurisdiction, to have been a voidable preference under the bankruptcy or insolvency laws of the United States or otherwise, then my obligation will remain as an obligation to you and will not be considered as having been extinguished.

6.REVOCATION.  I agree that this is an absolute and unconditional Guaranty.  I agree that this Guaranty will remain binding on me, whether or not there are any Debts outstanding, until you have actually received written notice of my revocation or written notice of my death or incompetence.  Notice of revocation or notice of my death or incompetence will not affect my obligations under this Guaranty with respect to any Debts incurred by or for which you have made a commitment to Borrower before you actually receive such notice, and all renewals, extensions, refinancings, and modifications of such Debts.  I agree that if any other person signing this Guaranty provides a notice of revocation to you, I will still be obligated under this Guaranty until I provide such a notice of revocation to you.  If any other person signing this Guaranty dies or is declared incompetent, such fact will not affect my obligations under this Guaranty.

7.PROPERTY.  I agree that any Property may be assigned, exchanged, released in whole or in part or substituted without notice to me and without defeating, discharging or diminishing my liability.  My obligation is absolute and your failure to perfect any security interest or any act or omission by you which impairs the Property will not relieve me or my liability under this Guaranty.  You are under no duty to preserve or protect any Property until you are in actual or constructive possession.  For purposes of this paragraph, you will only be in "actual" possession when you have physical, immediate and exclusive control over the Property and have accepted such control in writing.  Further, you will only be deemed to be in "constructive" possession when you have both the power and intent to exercise control over the Property.

8.DEFAULT.  I will be in default if any of the following events (known separately and collectively as an Event of Default) occur:

A.Payments.  I fail to make a payment in full when due.

B.Insolvency or Bankruptcy.  The death, dissolution or insolvency of, appointment of a receiver by or on behalf of, application of any debtor relief law, the assignment for the benefit of creditors by or on behalf of, the voluntary or involuntary termination of existence by, or the commencement of any proceeding under any present or future federal or state insolvency, bankruptcy, reorganization, composition or debtor relief law by or against me, Borrower, or any co­signer, endorser, surety or guarantor of this Guaranty or any Debt.

C.Death or Incompetency.  I die or am declared legally incompetent.

D.Failure to Perform.  I fail to perform any condition or to keep any promise or covenant of this Guaranty.

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E.Other Documents.  A default occurs under the terms of any other document relating to the Debt.

F.Other Agreements.  I am in default on any other debt or agreement I have with you.

G.Misrepresentation.  I make any verbal or written statement or provide any financial information that is untrue, inaccurate, or conceals a material fact at the time it is made or provided.

H.Judgment.  I fail to satisfy or appeal any judgment against me.

I.Forfeiture.  The Property is used in a manner or for a purpose that threatens confiscation by a legal authority.

J.Name Change.  I change my name or assume an additional name without notifying you before making such a change.

K.Property Transfer.  I transfer all or a substantial part of my money or property.

L.Property Value.  You determine in good faith that the value of the Property has declined or is impaired.

M.Insecurity.  You determine in good faith that a material adverse change has occurred in my financial condition from the conditions set forth in my most recent financial statement before the date of this Guaranty or that the prospect for payment or performance of the Debt is impaired for any reason.

9.WAIVERS AND CONSENT.  To the extent not prohibited by law, I waive protest, presentment for payment, demand, notice of acceleration, notice of intent to accelerate and notice of dishonor.

A.Additional Waivers.  In addition, to the extent permitted by law, I consent to certain actions you may take, and generally waive defenses that may be available based on these actions or based on the status of a party to the Debt or this Guaranty.

(1)You may renew or extend payments on the Debt, regardless of the number of such renewals or extensions.

(2)You may release any Borrower, endorser, guarantor, surety, accommodation maker or any other co-signer.

(3)You may release, substitute or impair any Property.

(4)You, or any institution participating in the Debt, may invoke your right of set-off.

(5)You may enter into any sales, repurchases or participations of the Debt to any person in any amounts and I waive notice of such sales, repurchases or participations.

(6)I agree that the Borrower is authorized to modify the terms of the Debt or any instrument securing, guarantying or relating to the Debt.

(7)You may undertake a valuation of any Property in connection with any proceedings under the United States Bankruptcy Code concerning the Borrower or me, regardless of any such valuation, or actual amounts received by you arising from the sale of such Property.

(8)I agree to consent to any waiver granted the Borrower, and agree that any delay or lack of diligence in the enforcement of the Debt, or any failure to file a claim or otherwise protect any of the Debt, in no way affects or impairs my liability.

(9)I agree to waive reliance on any anti-deficiency statutes, through subrogation or otherwise, and such statutes in no way affect or impair my liability.  In addition, until the obligations of the Borrower to Lender have been paid in full, I waive any right of subrogation, contribution, reimbursement, indemnification, exoneration, and any other right I may have to enforce any remedy which you now have or in the future may have against the Borrower or another guarantor or as to any Property.

Any Guarantor who is an "insider," as contemplated by the United States Bankruptcy Code, 11 U.S.C. 101, as amended, makes these waivers permanently.  (An insider includes, among others, a director, officer, partner, or other person in control of the Borrower, a person or an entity that is a co-partner with the Borrower, an entity in which the Borrower is a general partner, director, officer or other person in control or a close relative of any of these other persons.) Any Guarantor who is not an insider makes these waivers until all Debt is fully repaid.

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B.No Waiver By Lender.  Your course of dealing, or your forbearance from, or delay in, the exercise of any of your rights, remedies, privileges or right to insist upon my strict performance of any provisions contained in the Debt instruments, shall not be construed as a waiver by you, unless any such waiver is in writing and is signed by you.

C.Waiver of Claims.  I waive all claims for loss or damage caused by your acts or omissions where you acted reasonably and in good faith.

10.REMEDIES.  After the Borrower or I default, you may at your option do any one or more of the following.

A.Acceleration.  You may make all or any part of the amount owing by the terms of this Guaranty immediately due.

B.Sources.  You may use any and all remedies you have under state or federal law or in any documents relating to the Debt.

C.Insurance Benefits.  You may make a claim for any and all insurance benefits or refunds that may be available on default.

D.Payments Made on the Borrower's Behalf.  Amounts advanced on the Borrower's behalf will be immediately due and may be added to the balance owing under the Debt.

E.Termination.  You may terminate my rights to obtain advances or other extensions of credit by any of the methods provided in this Guaranty.

F.Attachment.  You may attach or garnish my wages or earnings.

G.Set-Off.  You may use the right of set-off.  This means you may set-off any amount due and payable under the terms of this Guaranty against any right I have to receive money from you.

My right to receive money from you includes any deposit or share account balance I have with you; any money owed to me on an item presented to you or in your possession for collection or exchange; and any repurchase agreement or other non-deposit obligation.  "Any amount due and payable under the terms of this Guaranty" means the total amount to which you are entitled to demand payment under the terms of this Guaranty at the time you set-off.

Subject to any other written contract, if my right to receive money from you is also owned by someone who has not agreed to pay the Debt, your right of set­off will apply to my interest in the obligation and to any other amounts I could withdraw on my sole request or endorsement.

In addition, you may also have rights under a "statutory lien".  A "statutory lien" means your right under state or federal law to establish a right in, or claim to, my shares and dividends to the extent of any outstanding financial obligations that I have with you.  If you have a statutory lien, you may without further notice, impress and enforce the statutory lien on my shares and dividends to the extent of any sums due and payable under the terms of this Guaranty that I fail to satisfy.

Your set-off and statutory lien rights do not apply to an account or other obligation where my rights arise only in a representative capacity.  They also do not apply to any Individual Retirement Account or other tax-deferred retirement account.

You will not be liable for the dishonor of any check or share draft when the dishonor occurs because you set-off against any of my accounts, or exercised your statutory lien rights.  I agree to hold you harmless from any such claims arising as a result of your exercise of your right of set-off or statutory lien rights.

H.Waiver.  Except as otherwise required by law, by choosing any one or more of these remedies you do not give up your right to use any other remedy.  You do not waive a default if you choose not to use a remedy.  By electing not to use any remedy, you do not waive your right to later consider the event a default and to use any remedies if the default continues or occurs again.

11.COLLECTION EXPENSES AND ATTORNEYS' FEES.  On or after the occurrence of an Event of Default, to the extent permitted by law, I agree to pay all expenses of collection, enforcement or protection of your rights and remedies under this Guaranty or any other document relating to the Debt.  To the extent permitted by law, expanses include, but are not limited to, reasonable attorneys' fees, court costs and other legal expenses.  All fees and expenses will be secured by the Property I have granted to you, if any.  In addition, to the extent permitted by the United States Bankruptcy Code, I agree to pay the reasonable attorneys' fees incurred by you to protect your rights and interests in connection with any bankruptcy proceedings initiated by or against me.

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12.WARRANTIES AND REPRESENTATIONS.  I have the right and authority to enter into this Guaranty.  The execution and delivery of this Guaranty will not violate any agreement governing me or to which I am a party.

In addition, I represent and warrant that this Guaranty was entered into at the request of the Borrower, and that I am satisfied regarding the Borrower's financial condition and existing indebtedness, authority to borrow and the use and intended use of all Debt proceeds.  I further represent and warrant that I have not relied on any representations or omissions from you or any information provided by you respecting the Borrower, the Borrower's financial condition and existing indebtedness, the Borrower's authority to borrow or the Borrower's use and intended use of all Debt proceeds.

13.RELIANCE.  I acknowledge that you are relying on this Guaranty in extending credit to the Borrower, and I have signed this Guaranty to induce you to extend such credit.  I represent and warrant to you that I have a direct and substantial economic interest in the Borrower and expect to derive substantial benefits from any loans and financial accommodations resulting in the creation of indebtedness guarantied hereby.  I agree to rely exclusively on the right to revoke this Guaranty prospectively as to future transactions in the manner as previously described in this Guaranty if at any time, in my opinion, the benefits then being received by me in connection with this Guaranty are not sufficient to warrant the continuance of this Guaranty.  You may rely conclusively on a continuing warranty that I continue to be benefited by this Guaranty and you will have no duty to inquire into or confirm the receipt of any such benefits, and this Guaranty will be effective and enforceable by you without regard to the receipt, nature or value of any such benefits.

14.APPLICABLE LAW.  This Guaranty is governed by the laws of Florida, the United States of America, and to the extent required, by the laws of the jurisdiction where the Property is located, except to the extent such state laws are preempted by federal law.

15.AMENDMENT, INTEGRATION AND SEVERABILITY.  This Guaranty may not be amended or modified by oral agreement.  No amendment or modification of this Guaranty is effective unless made in writing and executed by you and me.  This Guaranty is the complete and final expression of the agreement.  If any provision of this Guaranty is unenforceable, then the unenforceable provision will be severed and the remaining provisions will still be enforceable.

16.ASSIGNMENT.  If you assign any of the Debts, you may assign all or any part of this Guaranty without notice to me or my consent, and this Guaranty will inure to the benefit of your assignee to the extent of such assignment.  You will continue to have the unimpaired right to enforce this Guaranty as to any of the Debts that are not assigned.  This Guaranty shall inure to the benefit of and be enforceable by you and your successors and assigns and any other person to whom you may grant an interest in the Debts and shall be binding upon and enforceable against me and my personal representatives, successors, heirs and assigns.

17.INTERPRETATION.  Whenever used, the singular includes the plural and the plural includes the singular.  The section headings are for convenience only and are not to be used to interpret or define the terms of this Guaranty.

18.NOTICE, FINANCIAL REPORTS AND ADDITIONAL DOCUMENTS.  Unless otherwise required by law, any notice will be given by delivering it or mailing it by first class mail to the appropriate party's address listed in the DATE AND PARTIES section, or to any other address designated in writing.  Notice to one Guarantor will be deemed to be notice to all Guarantors.  I will inform you in writing of any change in my name, address or other application information.  I will provide you any financial statement or information you request.  All financial statements and information I give you will be correct and complete.  I agree to sign, deliver, and file any additional documents or certifications that you may consider necessary to perfect, continue, and preserve my obligations under this Guaranty and to confirm your lien status on any Property.  Time is of the essence.

19.CREDIT INFORMATION.  I agree that from time to time you may obtain credit information about me from others, including other lenders and credit reporting agencies, and report to others (such as a credit reporting agency) your credit experience with me.  I agree that you will not be liable for any claim arising from the use of information provided to you by others or for providing such information to others.

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20.ADDITIONAL TERMS.  DURING THE TERM OF THIS LOAN, I/WE WILL PROVIDE THE FOLLOWING INFORMATION WITHIN THE TIME FRAMES OUTLINED:

-ANNUAL SIGNED PERSONAL FINANCIAL STATEMENTS (ON A FORM PROVIDED BY LENDER) DUE TO THE LENDER TWELVE (12) MONTHS FOLLOWING LAST DATED STATEMENT SUPPLIED.

-ANNUAL SIGNED FEDERAL TAX RETURNS DUE TO THE LENDER ON OR BEFORE APRIL 15th OF EACH YEAR.  IF AN EXTENSION IS FILED, A COPY OF SAME WILL PROMPTLY BE SUPPLIED TO THE LENDER AND THEN THE SIGNED COPY OF THE TAX RETURN WILL BE DUE TO THE LENDER THE SAME DAY IT IS DUE TO THE IRS FOR EACH YEAR.

21.WAIVER OF JURY TRIAL.  All of the parties to this Guaranty knowingly and intentionally, irrevocably and unconditionally, waive anyand all right to a trial by jury in any litigation arising out of or concerning this Guaranty or any other documents relating to the Debt or related obligation.  All of these parties acknowledge that this section has either been brought to the attention of each party's legal counsel or that each party had the opportunity to do so.

22.SIGNATURES.  By signing, I agree to the terms contained in this Guaranty.  I also acknowledge receipt of a copy of this Guaranty.

GUARANTOR:

/s/ Charles E. Strattan        

Charles E. Strattan

Individually

LENDER:

Sunstate Federal Credit Union

By:  /s/ Brian Miller       

Brian Miller, Commercial Loan Officer

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