Exhibit 10.1

CREDIT AGREEMENT
dated as of October 9, 2015
among
NATUS MEDICAL INCORPORATED,
as Borrower,
THE MATERIAL DOMESTIC SUBSIDIARIES OF BORROWER FROM TIME TO TIME PARTY
HERETO,
as Subsidiary Guarantors, and CITIBANK, N.A., as Bank

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TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS    1
Section 1.1    Certain Defined Terms.     1
Section 1.2    Certain Rules Of Construction    14
ARTICLE II CREDIT TERMS    16
Section 2.1    Revolving Line Of Credit    16
Section 2.2    Procedures For Borrowing    17
Section 2.3    Principal Payments And Prepayments    18
Section 2.4    Interest/Applicable Rates    18
Section 2.5    Fees    19
Section 2.6    Computations Of Interest And Fees    19
Section 2.7    Payments Generally; Collection Of Payments    19
Section 2.8    Collateral    20
Section 2.9    Guaranties    20
ARTICLE III INCREASED COSTS; TAXES    20
Section 3.1    Increased Costs    20
Section 3.2    Taxes    21
Section 3.3    Inability To Determine Rates    22
Section 3.4    Compensation For Losses    23
Section 3.5    Survival    23
ARTICLE IV REPRESENTATIONS AND WARRANTIES    23
Section 4.1    Legal Status    23
Section 4.2    Authorization And Validity    23
Section 4.3    No Violation    24
Section 4.4    Litigation    24
Section 4.5    Correctness Of Financial Statement    24
Section 4.6    Income Tax Returns    24
Section 4.7    No Subordination    24
Section 4.8    Permits, Franchises    24
Section 4.9    Erisa Compliance    24
Section 4.10 Other Obligations    25
Section 4.11 Environmental Matters    25

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Section 4.12 Health Care and FDA Matters    25
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TABLE OF CONTENTS
(continued)
Page
ARTICLE V CONDITIONS    27
Section 5.1    Conditions Of Initial Extension Of Credit    27
Section 5.2    Conditions Of Each Extension Of Credit    28
ARTICLE VI AFFIRMATIVE COVENANTS    28
Section 6.1    Punctual Payments    29
Section 6.2    Accounting Records; Collateral Exams    29
Section 6.3    Financial Statements    29
Section 6.4    Compliance    29
Section 6.5    Insurance    29
Section 6.6    Facilities    30
Section 6.7    Taxes And Other Liabilities    30
Section 6.8    Litigation    30
Section 6.9    Financial Condition    30
Section 6.10 Notice To Bank    30
Section 6.11 Maintenance Of Accounts With Bank    30
Section 6.12    Subsidiaries    30
Section 6.13 Health Care Covenants    31
Section 6.14 Post-Closing Covenants    31
ARTICLE VII NEGATIVE COVENANTS    32
Section 7.1    Use Of Funds    32
Section 7.2    Capital Expenditures    32
Section 7.3    Lease Expenditures    32
Section 7.4    Other Indebtedness    32
Section 7.5    Merger, Consolidation, Transfer Of Assets    32
Section 7.6    Guaranties    32
Section 7.7    Loans, Advances, Investments    32
Section 7.8    Dividends, Distributions    33
Section 7.9    Pledge Of Assets    33
Section 7.10 Sale And Leasebacks    33
Section 7.11    Transactions With Affiliates    33

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ARTICLE VIII EVENTS OF DEFAULT    33
Section 8.1    Events Of Default    33
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TABLE OF CONTENTS
(continued)
Page
Section 8.2    Remedies    35
ARTICLE IX MISCELLANEOUS    35
Section 9.1    No Waiver    35
Section 9.2    Notices    35
Section 9.3    Expenses; Indemnity; Damage Waiver    36
Section 9.4    Successors, Assignment    37
Section 9.5    Confidentiality    37
Section 9.6    Guaranty    37
Section 9.7    Entire Agreement; Amendment    44
Section 9.8    No Third Party Beneficiaries    44
Section 9.9    Time    44
Section 9.10    Severability Of Provisions    44
Section 9.11    Counterparts    44
Section 9.12 Governing Law; Submission to Jurisdiction    44
Section 9.13 Waiver Of Jury Trial    45
Section 9.14 Termination Of Agreement    45
Section 9.15 No Obligation To Lend    45

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SCHEDULES
1.1-A Permitted Indebtedness
1.1-B Permitted Investments
1.1-C Permitted Liens
4.1    Subsidiaries
4.4    Litigation
4.11 Environmental Matters
4.12 Heathcare and FDA Matters
EXHIBITS
A    Form of Revolving Line of Credit Note
B    Form of Loan Notice
C    Form of Financial Covenant Compliance Certificate

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WEST\258948078.15    iv
CREDIT AGREEMENT
THIS CREDIT AGREEMENT (this “Agreement”) is entered into as of October 9, 2015,
by and among NATUS MEDICAL INCORPORATED, a Delaware corporation (“Borrower”),
the Material Domestic Subsidiaries from time to time party hereto, and CITIBANK,
N.A. (“Bank”).
RECITALS
WHEREAS, Borrower has requested that Bank extend credit to Borrower as described
below, and Bank has agreed to provide such credit to Borrower on the terms and
conditions contained herein.
NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Bank and Borrower hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 CERTAIN DEFINED TERMS. As used in this Agreement, the following
terms shall have the meaning set forth below:
“Acquired Business” means the entity or assets acquired by Borrower in an
Acquisition, whether before or after the date of this Agreement.
“Acquisition” means any transaction or series of related transactions for the
purpose of or resulting, directly or indirectly, in (a) the acquisition of all
or substantially all of the assets of a Person, or of any business or division
of a Person, (b) the acquisition of in excess of 50% of the capital stock,
partnership interests, membership interests or equity of any Person, or (c) a
merger or consolidation or any other combination with another Person provided
that Borrower is the surviving entity.
“Additional Secured Obligations” means (a) all obligations arising under Secured
Letters of Credit (b) all obligations arising under Secured Cash Management
Agreements and (c) all costs and expenses incurred in connection with
enforcement and collection of the foregoing, including the fees, charges and
disbursements of counsel, in each case whether direct or indirect (including
those acquired by assumption), absolute or contingent, due or to become due, now
existing or hereafter arising and including interest and fees that accrue after
the commencement by or against Borrower or any Guarantor of any proceeding under
any Bankruptcy Laws naming such Person as the debtor in such proceeding,
regardless of whether such interest and fees are allowed claims in such
proceeding.
“Agreement” has the meaning ascribed to such term in the introductory paragraph
hereof.
“Applicable Rate” means, from time to time, with respect to any Base Rate Loan,
or LIBOR Loan, as the case may be, the applicable rate per annum set forth below
(expressed in basis points) under the caption “LIBOR Spread”:
LIBOR Spread
175.00
“ASC 740” means Financial Accounting Standards Board’s Accounting Standards
Codification Topic 740 , Income Taxes (formerly SFAS 109, Accounting for Income
Taxes)
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“ASC 805” means Financial Accounting Standards Board’s Accounting Standards
Codification Topic 805, Business Combinations (formerly SFAS 141R).
“Attributable Indebtedness” means, on any date of determination: (a) in respect
of any capital lease of any Person, the capitalized amount thereof that would
appear on a balance sheet of such Person prepared as of such date in accordance
with GAAP; and (b) in respect of any Synthetic Lease Obligation, the capitalized
amount of the remaining lease payments under the relevant lease that would
appear on a balance sheet of such Person prepared as of such date in accordance
with GAAP if such lease were accounted for as a capital lease.
“Availability Period” means the period from the Closing Date to the earlier of
(i) the Revolving Credit Maturity Date and (ii) the date that the Bank may
immediately cease extending further credit under the Loan Documents pursuant to
Section 8.2.
“Bank” has the meaning ascribed to such term in the introductory paragraph
hereof.
“Bankruptcy Code” means the Bankruptcy Reform Act, Title 11 of the United States
Code.
“Bankruptcy Laws” means, collectively: (a) the Bankruptcy Code; and (b) all
other liquidation, conservatorship, bankruptcy, assignment for the benefit of
creditors, moratorium, rearrangement, receivership, insolvency, reorganization,
or similar debtor relief Laws of the United States or other applicable
jurisdictions from time to time in effect and affecting the rights of creditors
generally.
“Base LIBOR” means the rate per annum for United States dollar deposits quoted
by Bank as the Inter-Bank Market Offered Rate, with the understanding that such
rate is quoted by Bank for the purpose of calculating effective rates of
interest for loans making reference thereto, on the first day of an Interest
Period for delivery of funds on said date for a period of time approximately
equal to the number of days in such Interest Period and in an amount
approximately equal to the principal amount to which such Interest Period
applies. Borrower understands and agrees that Bank may base its quotation of the
Inter-Bank Market Offered Rate upon such offers or other market indicators of
the Inter-Bank Market as Bank in its discretion deems appropriate including, but
not limited to, the rate offered for Dollar deposits on the London Inter-Bank
Market.
“Base Rate” means, for any day, a fluctuating rate per annum equal to the higher
of: (a) the Federal Funds Rate plus one-half of one percent per annum; and (b)
the per annum rate of interest in effect for such day as publicly announced from
time to time by Bank as its “Prime Rate,” such rate being the rate of interest
most recently announced within Bank at its principal office as its “Prime Rate”,
with the understanding that Bank’s “Prime Rate” is one of Bank’s base rates and
serves as the basis upon which effective rates of interest are calculated for
those loans making reference thereto, and is evidenced by the recording thereof
after its announcement in such internal publication or publications as Bank may
designate. Any change in Bank’s “Prime Rate” as announced by Bank shall take
effect at the opening of business on the day specified in the public
announcement of such change.
“Base Rate Loan” means a Loan that bears interest based upon the Base Rate.
“Borrower” has the meaning ascribed to such term in the introductory paragraph
hereof.
“Business Day” means any day except a Saturday, Sunday or any other day on which
commercial banks in California are authorized or required by Law to close;
provided that, if any such day relates to LIBOR or any LIBOR Loan, such day must
also be a day on which dealings in Dollar deposits are conducted by and between
banks in the London interbank offered market.
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“Cash Management Agreement” means any agreement that is not prohibited by the
terms hereof to provide treasury or cash management services, including deposit
accounts, overnight draft, credit cards, debit cards, p-cards (including
purchasing cards and commercial cards), funds transfer, automated clearinghouse,
zero balance accounts,

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returned check concentration, controlled disbursement, lockbox, account
reconciliation and reporting and trade finance services and other cash
management services.
“Cash Restructuring Charges” means cash based restructuring charges, as defined
under GAAP, for any entity that is the subject of a Permitted Acquisition;
provided that in no event shall Cash Restructuring Charges exceed $5,000,000 in
the aggregate during the term of this Agreement.
“Change in Law” means any of the following occurring after the Closing Date: (a)
the adoption or taking effect of any Law, rule, regulation or treaty; (b) any
change in any Law, rule, regulation or treaty or in the administration,
interpretation or application thereof by any Governmental Authority; or (c) the
making or issuance of any request, guideline or directive (whether or not having
the force of Law) by any Governmental Authority; provided that, for purposes
hereof, the Dodd-Frank Wall Street Reform and Consumer Protection Act and all
requests, guidelines and directions in connection therewith are deemed to have
been adopted and gone into effect after the Closing Date.
“Change of Control” means an event or series of events by which any “person” or
“group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act,
but excluding any employee benefit plan of such person or its subsidiaries, and
any person or entity acting in its capacity as trustee, agent or other fiduciary
or administrator of any such plan) becomes the “beneficial owner” (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of thirty
percent or more of the Equity Interests of Borrower entitled to vote for members
of the board of directors or equivalent governing body of Borrower on a
fully-diluted basis (and taking into account all such securities that such
person or group has the right to acquire pursuant to any option right).
“Closing Date” means October 9, 2015.
“Code” means the Internal Revenue Code of 1986.
“Compliance Certificate” means a certificate substantially in the form of
Exhibit C.
“Confidential Information” means all non-public, confidential and/or proprietary
information of Borrower, its Subsidiaries or any Subsidiary thereof, now or at
any time hereafter provided to Bank by Borrower, or any of Borrower’s officers,
employees, agents or representatives, in connection with Bank’s evaluation of
Borrower’s credit request and/or Bank’s ongoing credit accommodations to
Borrower, and shall include, without limitation, any and all financial,
technical and/or business information relating to Borrower, its Subsidiaries or
any Subsidiary thereof, including trade secrets, research and development test
results, marketing or business plans and strategies, forecasts, budgets,
projections, customer and supplier information, and any other analyses,
computations or studies prepared by or for Borrower, any of its Subsidiaries or
any Subsidiary thereof.
“Consolidated Capital Expenditures” means, for any period and as of any date of
determination, for Borrower and its Subsidiaries on a consolidated basis, an
amount equal to the sum of all investments in fixed assets of such persons for
such period.
“Consolidated EBITDA” means, for any period and as of any date of determination,
for Borrower and its Subsidiaries on a consolidated basis, an amount equal to
Consolidated Net Income for such period
plus (a) the following to the extent deducted in calculating such Consolidated
Net Income:    (i)
Consolidated Interest Expense for such period, (ii) Consolidated Provision for
Income Taxes for such
WEST\258948078.15    3
period deducted to arrive at Consolidated Net Income, (iii) depreciation and
amortization expense, (iv) all non-cash expenses related to stock-based
compensation deducted to arrive at Consolidated Net Income, (v) other
non-recurring expenses of Borrower and its Subsidiaries reducing such
Consolidated Net Income which do not represent a cash item

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in such period or any future period, (vi) Cash Restructuring Charges (provided
that the aggregate amount of Cash Restructuring Charges added to Consolidated
Net Income for any twelve-month period pursuant to this clause (vi) shall not
exceed $5,000,000), and (vii) expenses created by contingent consideration or
transaction costs related to a business combination or acquisition, to the
extent required to be expensed by ASC 805, and minus (b) the following to the
extent included in calculating such Consolidated Net Income: (i) interest income
(ii) extraordinary or non-recurring non-cash income or gains, (iii) all non-cash
items increasing Consolidated Net Income for such period, and (iv) adjustments
to income created by contingent consideration related to a business combination
or acquisition, to the extent required to be recognized by ASC 805.
“Consolidated Funded Indebtedness” means, as of any date of determination, for
Borrower and its Subsidiaries on a consolidated basis, the sum of (a) the
outstanding principal amount of all obligations, whether current or long-term,
for borrowed money (including obligations hereunder) and all obligations
evidenced by bonds, debentures, notes, loan agreements or other similar
instruments, (b) all purchase money indebtedness, (c) all direct obligations
arising under letters of credit (including standby and commercial),
reimbursement agreements, bankers’ acceptances, bank guaranties, surety bonds
and similar instruments, (d) all obligations in respect of the deferred purchase
price of property or services (other than trade accounts payable in the ordinary
course of business), (e) Attributable Indebtedness in respect of capital leases
and Synthetic Lease Obligations, (f) without duplication, all guarantees with
respect to outstanding indebtedness of the types specified in clauses (a)
through (e) above of Persons other than Borrower or any Subsidiary, and (g) all
indebtedness of the types referred to in clauses (a) through (f) above of any
partnership or joint venture (other than a joint venture that is itself a
corporation or limited liability company) in which Borrower or a Subsidiary is a
general partner or joint venturer, unless such indebtedness is expressly made
non-recourse to Borrower or such Subsidiary.
“Consolidated Interest Expense” means, for any period, for Borrower and its
Subsidiaries on a consolidated basis, an amount equal to the sum of all interest
charges (including imputed interest charges with respect to capitalized lease
obligations and all amortization of debt discount and expense) of such Persons
for such period.
“Consolidated Leverage Ratio” means, as of any date of determination, for
Borrower and its Subsidiaries on a consolidated basis, the ratio of: (a)
Consolidated Funded Indebtedness as of such date to (b) Consolidated EBITDA for
the four consecutive fiscal quarters ending on such date.
“Consolidated Net Income” means, for any period, for Borrower and its
Subsidiaries on a consolidated basis, the net income of Borrower and its
Subsidiaries from continuing operations (excluding gains or losses from
dispositions of assets) for such period.
“Consolidated Provision for Income Taxes” means, for any period, for Borrower
and its Subsidiaries on a consolidated basis, the provision for income taxes
calculated in accordance with ASC 740.
“Debt Service Coverage Ratio” means, for any period and as of any date of
determination, for Borrower and its Subsidiaries on a consolidated basis, the
ratio of: (a) the sum of (i) Consolidated EBITDA minus (ii) payments in cash for
taxes on or measured by income made by Borrower or its Subsidiaries for such
period minus (iii) unfinanced Consolidated Capital Expenditures minus (iv) any
dividends or distributions paid in cash during such period to (b) the sum of (i)
the current portion of all Consolidated Funded Indebtedness plus (ii)
Consolidated Interest Expense.
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“Default” means any event or condition that constitutes an Event of Default or
that, with the giving of notice, the passage of time, or both, would constitute
an Event of Default.
“Default Rate” means a per annum interest rate equal to the sum of: (i) the Base
Rate; plus (iii) four hundred basis points per annum; provided that, with
respect to a LIBOR Loan, the Default Rate shall be a per annum interest rate
equal to the sum of: (A) the interest rate (including any Applicable Rate)
otherwise applicable to such Loan; plus (B) four hundred basis points per annum.

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“Dollar” and “$” mean lawful money of the United States.
“Domestic Subsidiary” means any Subsidiary that is not a Foreign Subsidiary.
“Eligible Line of Business” means any business engaged primarily in (i) the sale
of medical devices and associated supplies or (ii) providing services in
connection with medical devices.
“Environmental Claims” means all claims, however asserted, by any Governmental
Authority or other Person alleging Environmental Liabilities.
“Environmental Laws” means any and all United States federal, state, local, and
foreign statutes, Laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including
those related to hazardous substances or wastes, air emissions and discharges to
waste or public systems.
“Environmental Liability” means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of Borrower, any Guarantor or any of their respective
Subsidiaries directly or indirectly resulting from or based upon: (a) violation
of any Environmental Law; (b) the generation, use, handling, transportation,
storage, treatment or disposal of any Hazardous Materials; (c) exposure to any
Hazardous Materials; (d) the release or threatened release of any Hazardous
Materials into the environment; or (e) any contract, agreement or other
consensual arrangement pursuant to which liability is assumed or imposed with
respect to any of the foregoing.
“Equity Interests” means, with respect to any Person, all of the shares of
capital stock of (or other ownership or profit interests in) such Person, all of
the warrants, options or other rights for the purchase or acquisition from such
Person of shares of capital stock of (or other ownership or profit interests in)
such Person, all of the securities convertible into or exchangeable for shares
of capital stock of (or other ownership or profit interests in) such Person or
warrants, rights or options for the purchase or acquisition from such Person of
such shares (or such other interests), and all of the other ownership or profit
interests in such Person (including partnership, member or trust interests
therein), whether voting or nonvoting, and whether or not such shares, warrants,
options, rights or other interests are outstanding on any date of determination.
“ERISA” means the Employee Retirement Income Security Act of 1974.
“ERISA Affiliate” means any trade or business (whether or not incorporated)
under common control with Borrower or any Subsidiary thereof within the meaning
of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code
for purposes of provisions relating to Section 412 of the Code).
“ERISA Event” means any of the following: (a) a Reportable Event with respect to
a Pension Plan; (b) a withdrawal by Borrower or any ERISA Affiliate from a
Pension Plan subject to Section 4063
WEST\258948078.15    5
of ERISA during a plan year in which it was a substantial employer (as defined
in Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as
such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial
withdrawal by Borrower or any ERISA Affiliate from a Multiemployer Plan or
notification that a Multiemployer Plan is in reorganization; (d) the filing of a
notice of intent to terminate, the treatment of a Plan amendment as a
termination under Sections 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e)
an event or condition that constitutes grounds under Section 4042 of ERISA for
the termination of, or the appointment of a trustee to administer, any Pension
Plan or Multiemployer Plan; or (f) the imposition of any liability under Title
IV of ERISA, other than for PBGC premiums due but not delinquent under Section
4007 of ERISA, upon Borrower or any ERISA Affiliate.

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“Event of Default” has the meaning ascribed to such term in Article VIII hereof.
“Exchange Act” means the Securities Exchange Act of 1934.
“Existing Indebtedness” means that certain Indebtedness owing by the Borrower to
Wells Fargo Bank, National Association in the original principal amount of
$25,000,000.
“FDA” is defined in clause (i) of Section 4.12.
“Federal Funds Rate” means, for any day, the rate per annum equal to the
weighted average of the rates on overnight United States federal funds
transactions with members of the Federal Reserve System arranged by United
States federal funds brokers on such day, as published by the Federal Reserve
Bank of New York on the Business Day next succeeding such day; provided that:
(a) if such day is not a Business Day, then the Federal Funds Rate for such day
shall be such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day; and (b) if no such rate is so
published on such next succeeding Business Day, then the Federal Funds Rate for
such day shall be the average rate (rounded upward, if necessary, to a whole
multiple of one-hundredth of one percent) charged to Bank on such day on such
transactions as determined by Bank.
“Federal Health Care Program” means the government programs set forth in 42
U.S.C. § 1320a-
7b(f).
“FRB” means the Board of Governors of the Federal Reserve System of the United
States.
“Foreign Subsidiary” means any Subsidiary organized under the Laws of a country
(or political subdivision thereof) other than the United States (or political
subdivision thereof).
“GAAP” means generally accepted accounting principles applicable in the United
States set forth in the opinions and pronouncements of the Accounting Principles
Board and the American Institute of Certified Public Accountants and statements
and pronouncements of the Financial Accounting Standards Board or such other
principles as may be approved by a significant segment of the accounting
profession in the United States, that are applicable to the circumstances as of
the date of determination, consistently applied.
“Governmental Authority” means the government of the United States or any other
nation, or of any political subdivision thereof, whether state or local, and any
agency, authority, instrumentality, regulatory body, court, central bank or
other entity exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government (including any
supra-national bodies such as the European Union or the European Central Bank).
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“Guarantor” or “Guarantors” means each Subsidiary Guarantor.
“Hazardous Materials” means all explosive or radioactive substances or wastes
and all hazardous or toxic substances, wastes or other pollutants, including
petroleum or petroleum distillates, asbestos or asbestos-containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes and all other
substances or wastes of any nature regulated pursuant to any Environmental Law.
“Health Care Laws” means (a) all Laws related to (i) fraud and abuse, including
the Federal Antikickback Law (42 U.S.C. § 1320a-7b), the Stark Law (42 U.S.C. §
1395nn), the Federal False Claims Act (31 U.S.C. §§ 3729, et seq.), the Federal
Civil Monetary Penalties Law (42 U.S.C. § 1320a−7a), the Federal Program Fraud
Civil Remedies Act (31 U.S.C. § 3801 et seq.), the Federal Health Care Fraud law
(18 U.S.C. § 1347), the criminal false claims statutes (e.g., 18 U.S.C. §§ 287
and 1001), the Physician Payment Sunshine Act (42 U.S.C. § 1320a−7h), the
Federal Health Care Program Overpayment Statute (42 U.S.C. § 1320a-7k(d)), the
Medicare Secondary Payor Statute (42 U.S.C. §

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1395y(b)) and any similar state Laws, any government payment program or any Law
governing the licensure of or regulating healthcare providers, professionals,
facilities or payors or otherwise governing or regulating the provision of, or
payment for, medical services, or the sale of medical supplies, the U.S. Federal
Food, Drug and Cosmetic Act (21 U.S.C. § 301 et seq.), the Public Health Service
Act (42 U.S.C. § 201 et seq.), the Food and Drugs Act, R.S. 1985, c. F-27 and
Food and Drug Relations, C.R.C., ch. 870; and (ii) coding, coverage,
reimbursement, claims submission, billing and collections; and (b) the Patient
Protection and Affordable Care Act (Pub. L. 111−148) as amended by the Health
Care and Education Reconciliation Act of 2010 (Pub. L. 111−152) and the
regulations adopted thereunder.
“Health Care Permits” is defined in clause (b) of Section 4.12.
“Hostile Acquisition” means the acquisition of the capital stock or other equity
interests of a Person through a tender offer or similar solicitation of the
owners of such capital stock or other equity interests which has not been
approved (prior to such acquisition) by resolutions of the board of directors of
such Person or by similar action if such Person is not a corporation, or as to
which such approval has been withdrawn.
“Immaterial Domestic Subsidiary” means, as at any date of determination, any
Domestic Subsidiary whose assets as of the end of the most recent fiscal year
are less than five percent (5%) of the consolidated assets of Borrower and its
Subsidiaries as of the last day of such fiscal year or whose gross revenues for
such fiscal year are less than five percent (5%) of the consolidated gross
revenues of Borrower and its Subsidiaries for such fiscal year.
“Indemnitees” has the meaning ascribed thereto in Section 9.3(b).
“Interest Payment Date” means: (a) with respect to (i) a LIBOR Loan, the last
day of each Interest Period applicable thereto; provided that, if any such
Interest Period exceeds three months, the date that falls three months after the
beginning of such Interest Period shall also be an Interest Payment Date; and
(ii) a Base Rate Loan, the last Business Day of each calendar month; and (b) the
Revolving Credit Maturity Date.
“Interest Period” means, as to each LIBOR Loan, the period commencing on the
date such LIBOR Loan is disbursed or converted to or continued as a LIBOR Loan
and ending on the date one, two, three or six months thereafter, as selected by
Borrower in its related Loan Notice; provided that: (a) any Interest Period that
would otherwise end on a day that is not a Business Day shall be extended to the
next succeeding Business Day unless such Business Day falls in another calendar
month, in which case such Interest Period shall end on the next preceding
Business Day; (b) any Interest Period that begins on the
WEST\258948078.15    7
last Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month at the end of
such Interest Period; and (c) no Interest Period for any Revolving Credit Loan
shall extend beyond the Revolving Credit Maturity Date.
“Investment” means, as to any Person, any direct or indirect acquisition or
investment by such Person, whether by means of (a) the purchase or other
acquisition of capital stock or other securities of another Person, (b) a loan,
advance or capital contribution to, guarantee or assumption of debt of, or
purchase or other acquisition of any other debt or equity participation or
interest in, another Person, including any partnership or joint venture interest
in such other Person and any arrangement pursuant to which the investor
guarantees Indebtedness of such other Person, or (c) the purchase or other
acquisition (in one transaction or a series of transactions) of assets of
another Person that constitute a business unit. For purposes of covenant
compliance, the amount of any Investment shall be the amount actually invested,
without adjustment for subsequent increases or decreases in the value of such
Investment.
“Joinder Agreement” means an agreement entered into by a Material Domestic
Subsidiary of Borrower following the date hereof to join in the Guaranty set
forth in Section 9.6 or in any other form approved by Bank.

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“Laws” means, collectively, all statutes (including all Health Care Laws),
treaties, rules, guidelines, regulations, ordinances, codes and administrative
or judicial precedents or authorities of any Governmental Authority, including
the interpretation or administration thereof by any Governmental Authority
charged with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, consent decrees, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority.
“Letter of Credit Agreement” means any application and agreement that is not
prohibited by the terms hereof to provide standby letters of credit for the
account of Borrower or its Subsidiaries issued by Bank or an Affiliate of the
Bank from time to time during the term hereof.
“LIBOR” means the rate per annum (rounded upward, if necessary, to the nearest
whole 1/16 of 1%) and determined pursuant to the following formula:
LIBOR =    Base LIBOR
100% - LIBOR Reserve Percentage
“LIBOR Loan” means a Loan that bears interest based upon LIBOR.
“LIBOR Reserve Percentage” means the reserve percentage prescribed by the Board
of Governors of the Federal Reserve System (or any successor) for “Eurocurrency
Liabilities” (as defined in Regulation D of the Federal Reserve Board, as
amended), adjusted by Bank for expected changes in such reserve percentage
during the applicable Interest Period.
“Loan” means any Revolving Credit Loan.
“Loan Documents” means this Agreement, the Note, the Security Agreement, the
Pledge Agreement and each other contract, instrument and document required by or
delivered to Bank in connection with this Agreement.
WEST\258948078.15    8
“Loan Notice” means a notice, pursuant to Section 2.2(a), of: (a) a borrowing of
Loans; (b) a conversion of Loans from one Type to the other; or (c) a
continuation of LIBOR Loans; which, if in writing, shall be substantially in the
form of Exhibit B.
“Loan Party” means the Borrower and each Guarantor.
“Material Adverse Effect” means a material adverse effect on (i) the business
operations or financial condition of Borrower and its Subsidiaries taken as a
whole, (ii) the ability of Borrower to repay all debt, principal, interest,
expenses and other amounts owed to Bank by Borrower pursuant to this Agreement,
the Note and the other Loan Documents, or to otherwise perform its material
obligations under the Loan Documents, or (iii) Borrower’s interest in, or the
value, perfection or priority of Bank’s security interest or lien in, the
collateral described in Section 2.9 hereof.
“Material Domestic Subsidiary” means, as at any date of determination, (i) any
Domestic Subsidiary other than an Immaterial Domestic Subsidiary; provided that
in the event the assets as of the last day of the most recent fiscal year of all
Immaterial Domestic Subsidiaries as of such date that have not become a party to
this Agreement as a Subsidiary Guarantor are in excess of 10% of the
consolidated assets of Borrower and its Subsidiaries as of the last day of such
fiscal year or the gross revenues for the most recent fiscal year of all
Immaterial Domestic Subsidiaries as of such date that have not become a party to
this Agreement as a Subsidiary Guarantor are in excess of 10% of the
consolidated gross revenues of Borrower and its Subsidiaries for such fiscal
year, then Borrower shall designate one or more Immaterial Domestic Subsidiaries
of Borrower as Material Domestic Subsidiaries and (ii) any Immaterial Domestic
Subsidiary of Borrower that has been designated as a Material Domestic
Subsidiary by Borrower.

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“Multiemployer Plan” means any employee benefit plan of the type described in
Section 4001(a)(3) of ERISA to which Borrower or any ERISA Affiliate makes or is
obligated to make contributions, or during the preceding five plan years, has
made or been obligated to make contributions.
“Note” means the Revolving Credit Note.
“Obligations” means all advances, debts, liabilities, obligations, covenants and
duties of Borrower or any Guarantor under any Loan Document or otherwise,
whether with respect to any Loan or otherwise, whether direct or indirect
(including those acquired by assumption), absolute or contingent, due or to
become due, now existing or hereafter arising and including interest and fees
that accrue after the commencement by or against Borrower or any Guarantor or
any affiliate thereof of any proceeding under any Bankruptcy Law naming such
Person as the debtor in such proceeding, regardless of whether such interest and
fees are allowed claims in such proceeding.
“PBGC” means the Pension Benefit Guaranty Corporation.
“Pension Plan” means any “employee pension benefit plan” (as that term is
defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by Borrower or any
ERISA Affiliate or to which Borrower or any ERISA Affiliate contributes or has
an obligation to contribute, or in the case of a multiple employer or other plan
described in Section 4064(a) of ERISA, has made contributions at any time during
the immediately preceding five plan years.
“Permitted Acquisition” means any Acquisition with respect to which all of the
following conditions shall have been satisfied:
(a)    the Acquired Business is in an Eligible Line of Business;
WEST\258948078.15    9
(a)the Acquisition shall not be a Hostile Acquisition;
(b)the financial statements of the Acquired Business shall be in form and
substance satisfactory to Bank and shall have undergone review of a scope
satisfactory to Bank;
(c)(i) with respect to the Acquisition of any Acquired Business, the Total
Consideration for such Acquired Business shall not exceed $50,000,000, and (ii)
the Total Consideration for such Acquisition, when taken together with the Total
Consideration for all Acquired Businesses acquired after the date of this
Agreement, shall not exceed $250,000,000 in the aggregate;
(d)Borrower shall have notified Bank not less than 30 days prior to any such
Acquisition and furnished to Bank at such time reasonable details as to such
Acquisition (including sources and uses of funds therefor), and 3-year
historical financial information and 3-year pro forma financial forecasts of the
Acquired Business on a stand alone basis as well as of Borrower on a
consolidated basis after giving effect to the Acquisition and covenant
compliance calculations reasonably satisfactory to Bank demonstrating
satisfaction of the condition described in clause (f) below;
(e)after giving effect to the Acquisition, no Default or Event of Default shall
exist, including with respect to the financial covenants contained in Section
6.9 hereof (applicable as of the most recently ended fiscal quarter), tested on
a pro forma basis as of the date of the Acquisition;
(f)Borrower shall demonstrate, in reasonable detail, that the Acquired Business
had positive Consolidated EBITDA (calculated in the same manner as if the
reference to Borrower therein was to such Acquired Business) on a pro forma
basis for the four (4) fiscal quarter period ended immediately prior to the
proposed closing date of such Acquisition for which financial statements are
available;
(g)the Acquisition shall have been approved by Borrower’s board of directors and
(if necessary) owners, and all necessary legal and regulatory approvals with
respect to the Acquisition shall have been obtained; and
(h)with respect to any Acquisition in which the Total Consideration for such
Acquired Business does not exceed $15,000,000, Borrower does not need to comply
with clauses (c), (e) and (g) of this defined

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term “Permitted Acquisition”; provided, that if Borrower has not otherwise
complied with the clauses (c), (e) and (g) of this defined term “Permitted
Acquisition” prior to the consummation of any Acquisition, Borrower shall
provide to Bank notice of such Acquisition no later than 30 days following the
consummation of such Acquisition.
“Permitted Indebtedness” means:
(a)the liabilities of Borrower to Bank under this Agreement and the other Loan
Documents;
(b)any other liabilities of Borrower existing as of the Closing Date and listed
on Schedule 1.1-A;
(c)unsecured indebtedness to trade creditors incurred in the ordinary course of
business;
WEST\258948078.15    10
(d)    guaranty obligations of Borrower with respect to indebtedness of
Subsidiaries of Borrower permitted under Section 7.7;
(e)    indebtedness secured by Permitted Liens identified in paragraphs (d),
(e), (f), (g) (but solely with respect to Permitted Liens permitted under such
paragraph (g) that are related to extensions, renewals or refinancings of
indebtedness secured by liens identified in paragraph (d) of the definition of
Permitted Liens) and (j) of the definition of Permitted Liens; and
(f)    extensions, refinancings, modifications, amendments and restatements of
any items of Permitted Indebtedness identified in (a) through (d) above,
provided that the principal amount is not increased nor the terms modified to
impose more burdensome terms upon Borrower or its Subsidiaries, as the case may
be.
“Permitted Investments” means:
(a)Investments by Borrower existing as of the Closing Date and listed on
Schedule 1.1-B;
(b)Investments by Borrower in (i) marketable direct obligations issued or
unconditionally guaranteed by the United States or any agency or any state
thereof maturing within one year from the date of acquisition thereof, (ii)
commercial paper maturing no more than one year from the date of creation
thereof and currently having rating of at least A-2 or P-2 from either Standard
& Poor’s Corporation or Moody’s Investors Service, (iii) Bank’s certificates of
deposit maturing no more than one year from the date of investment therein, (iv)
Bank’s money market accounts, and (v) in conformance with Borrower’s “Investment
Policy,” as in effect on the Closing Date (or as amended from time to time,
subject to the approval of Bank), a copy of which has previously been provided
to Bank;
(c)Investments by Borrower consisting of the endorsement of negotiable
instruments for deposit or collection or similar transactions in the ordinary
course of business of Borrower;
(d)Investments by Borrower consisting of deposit accounts in which Bank has a
first priority perfected security interest;
(e)Investments by Borrower constituting Permitted Acquisitions;
(f)Investments by Borrower not to exceed at any time $250,000.00 in the
aggregate consisting of (i) travel advances and employee relocation loans and
other employee loans and advances in the ordinary course of business, and (ii)
loans to employees, officers or directors relating to the purchase of equity
securities of Borrower pursuant to employee stock purchase plans or agreements
approved by Borrower’s board of directors;
(g)Investments (including debt obligations) by Borrower not to exceed $50,000.00
in the aggregate outstanding at any time received in connection with the
bankruptcy or reorganization of customers or suppliers and in settlement of
delinquent obligations of, and other disputes with, customers or suppliers
arising in the ordinary course of business; and
(g)    Investments by Borrower (i) not to exceed $50,000.00 in the aggregate
outstanding at any time consisting of notes receivable of, or prepaid royalties
and other credit

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WEST\258948078.15    11
extensions to, customers and suppliers who are not affiliates, in the ordinary
course of business provided that this paragraph (h) shall not apply to
investments of Borrower in any Subsidiary.
“Permitted Liens” means:
(a)liens and security interests in favor of Bank created under any Loan
Document;
(b)liens and security interests existing as of the Closing Date and listed on
Schedule 1.1-C;
(c)liens for taxes, fees, assessments or other government charges or levies,
either not delinquent or being contested in good faith by appropriate
proceedings promptly instituted and diligently conducted and for which Borrower
maintains adequate reserves in accordance with GAAP;
(d)purchase money liens securing indebtedness not to exceed $2,000,000.00 in the
aggregate incurred after the Closing Date (i) on equipment acquired or held by
Borrower incurred for financing the acquisition of such equipment, or (ii)
existing on equipment when acquired, if the lien is confined to the property so
acquired and improvements thereon, and the proceeds of such equipment;
(e)statutory liens arising in the ordinary course of business and not overdue
for a period of more than thirty days or being contested in good faith by
appropriate proceedings promptly instituted and diligently conducted and for
which Borrower maintains adequate reserves in accordance with GAAP, not to
exceed $500,000.00 in the aggregate, securing claims or demands of materialmen,
mechanics, carriers, warehousemen, landlords and other persons imposed without
action of such parties;
(f)liens to secure payment of workers’ compensation, employment insurance,
old-age pensions, social security and other like obligations incurred in the
ordinary course of business not delinquent or being contested in good faith by
appropriate proceedings promptly instituted and diligently conducted and for
which Borrower maintains adequate reserves in accordance with GAAP;
(g)liens incurred in the extension, renewal or refinancing of the indebtedness
secured by liens identified in paragraphs (b) and (d) of this definition, so
long as such indebtedness is Permitted Indebtedness, provided that any
extension, renewal or replacement lien shall be limited to the property
encumbered by the existing lien and the principal amount of the indebtedness
being extended, renewed or refinanced does not increase;
(h)leases or subleases of real property entered into as sublessee or lessee in
the ordinary course of business, and leases; and subleases, non¬exclusive
licenses or sublicenses of property (other than real property or intellectual
property) entered into as licensee or sublicensee in the ordinary course of
Borrower’s business;
(i)non-exclusive licenses of intellectual property entered into as licensee with
third parties in the ordinary course of business; and
(j)liens in favor of financial institutions other than Bank arising in
connection with Borrower’s deposit and/or securities accounts held at such
institutions, provided that (i) Bank has a first priority perfected security
interest in the amounts held in such deposit and/or securities
WEST\258948078.15    12
accounts (excluding liens identified in the following clause (ii)) and (ii) such
liens secure Borrower’s payment of normal fees and charges related to the
maintenance of such deposit and/or securities accounts and not indebtedness
related to credit extended by such financial institutions to Borrower.
“Person” means any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership, Governmental Authority
or other entity.
“Plan” means any “employee benefit plan” (as such term is defined in Section
3(3) of ERISA) established by Borrower or, with respect to any such plan that is
subject to Section 412 of the Code or Title IV of ERISA, any ERISA Affiliate.
“Pledge Agreement” means (i) that certain Pledge Agreement, dated as of the date
hereof, executed by Borrower and certain other Loan Parties pledging capital
stock for the benefit of Bank as of the Closing Date and (ii) any other pledge
agreement executed by a Loan Party in favor of Bank.
“Reportable Event” means any of the events set forth in Section 4043(c) of
ERISA, other than events for which the thirty-day notice period has been waived.

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“Responsible Officer” means the chief executive officer, the president, the
chief financial officer, any vice president, the general counsel and/or
secretary, the assistant secretary, the controller of Borrower, the director of
finance of Borrower, or any other officer of Borrower having substantially the
same authority and responsibility as any of the foregoing.
“Revolving Credit Borrowing” means a borrowing of a Revolving Credit Loan of a
particular Type.
“Revolving Credit Loan” has the meaning ascribed to such term in Section 2.1(a).
“Revolving Credit Maturity Date” means October 7, 2016.
“Revolving Credit Note” has the meaning ascribed to such term in Section 2.1(a).
“Revolving Line of Credit” has the meaning ascribed to such term in Section
2.1(a)(i).
“Secured Cash Management Agreement” means any Cash Management Agreement between
any Loan Party and Bank.
“Secured Letter of Credit Agreement” means any Letter of Credit Agreement
between the Borrower and any of its Subsidiaries and Bank.
“Secured Obligations” means all Obligations and all Additional Secured
Obligations.
“Security Agreement” means (i) that certain Security Agreement, dated as of the
date hereof, executed by Borrower and certain other Loan Parties in favor of
Bank and (ii) any other security agreement executed by a Loan Party in favor of
Bank.
“Subsidiary” of a Person means a corporation, partnership, joint venture,
limited liability company or other business entity of which a majority of the
shares of securities or other interests having ordinary voting power for the
election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially
WEST\258948078.15    13
owned, or the management of which is otherwise controlled, directly, or
indirectly through one or more intermediaries, or both, by such Person. Unless
otherwise specified, all references herein to a “Subsidiary” or to
“Subsidiaries” shall refer to a Subsidiary or Subsidiaries of Borrower.
“Subsidiary Guarantor” has the meaning set forth in Section 9.6(a) hereof.
“Subsidiary Guarantor Subordinated Debt” has the meaning set forth in Section
9.6(i) hereof. “Subsidiary Guarantor Subordinated Debt Payments” has the meaning
set forth in Section 9.6(i) hereof.
“Synthetic Lease Obligation” means the monetary obligation of a Person under
either: (a) a so-called synthetic, off-balance sheet or tax retention lease; or
(b) an agreement for the use or possession of property creating obligations that
do not appear on the balance sheet of such Person but which, upon the insolvency
or bankruptcy of such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).
“Third Party Obligor” has the meaning ascribed to such term in Section 8.1(d)
hereof.
“Total Consideration” means, with respect to an Acquisition, the sum (but
without duplication) of (a) cash paid in connection with such Acquisition, (b)
indebtedness payable to the seller in connection with such Acquisition, (c) the
fair market value of any equity securities, including any warrants or options
therefor, delivered in connection with such Acquisition, (d) the amount of
contingent consideration or transaction costs related to such Acquisition, to
the extent required to be expensed by ASC 805, (e) the present value of
covenants not to compete entered into in connection with such Acquisition or
other future payments which are required to be made over a period of time and
are not contingent upon Borrower meeting financial performance objectives
(exclusive of salaries paid in the ordinary

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course of business) (discounted at the Base Rate in effect on the date of such
Acquisition), but only to the extent not included in clause (a), (b), (c) or (d)
above, and (f) the amount of indebtedness assumed in connection with such
Acquisition.
“Type” means, with respect to any Loan, its character as a Base Rate Loan or a
LIBOR Loan. SECTION 1.2 CERTAIN RULES OF CONSTRUCTION.
(a)Unless the context requires otherwise, the meaning of a defined term is
applicable equally to the singular and plural forms thereof.
(b)The words “hereof,” “herein,” “hereunder” and similar words refer to this
Agreement as a whole and not to any particular provision of this Agreement; and,
unless otherwise specified, Article, Section, subsection, clause, Schedule and
Exhibit references are to this Agreement.
(c)(i) The term “documents” includes instruments, documents, agreements,
certificates, indentures, notices and other writings, however evidenced.
(i)The terms “include” and “including” are not limiting.
(ii)In the computation of periods of time from a specified date to a later
specified date, the word “from” means “from and including”; the words “to” and
“until” each mean “to but excluding” and the word “through” means “to and
including.”
WEST\258948078.15    14
(iv)    Unless the context clearly requires otherwise, the terms “property,”
“properties,” “asset” and “assets” refer to both personal property (whether
tangible or intangible) and real property.
(a)Unless otherwise expressly provided herein: (i) references to documents
(including this Agreement) shall be deemed to include all subsequent amendments
and other modifications thereto, but only to the extent such amendments and
other modifications are not prohibited by the terms of any Loan Document; and
(ii) references to any statute or regulation are to be construed as including
all statutory and regulatory provisions consolidating, amending, replacing,
supplementing or interpreting the statute or regulation.
(b)Unless otherwise specified, all references herein to times of day shall be
references to Pacific time (daylight or standard, as applicable).
(c)The captions and headings of this Agreement are for convenience of reference
only and shall not affect the interpretation of this Agreement.
(d)This Agreement and the other Loan Documents may use several different
limitations, tests or measurements to regulate the same or similar matters. All
such limitations, tests and measurements are cumulative and shall be performed
in accordance with their respective terms.
(e)This Agreement and the other Loan Documents are the result of negotiations
among, and have been reviewed by counsel to, Borrower, the Guarantors and Bank
and are the products of all parties. Accordingly, they shall not be construed
against Bank merely because of the involvement of any or all of the preceding
Persons in their preparation.
(f)Unless the context otherwise clearly requires, all accounting terms not
expressly defined herein shall be construed, and all financial computations
required under this Agreement shall be made, in accordance with GAAP. If at any
time any change in GAAP would affect the computation of any financial ratio or
requirement set forth in any Loan Document, and Bank shall so request, Bank and
Borrower shall negotiate in good faith to amend such ratio or requirement to
preserve the original intent thereof in light of such change in GAAP; provided
that, until so amended: (i) such ratio or requirement shall continue to be
computed in accordance with GAAP prior to such change therein; and (ii) Borrower
shall provide to Bank financial statements and other documents required under
this Agreement or as reasonably requested hereunder setting forth a
reconciliation between calculations of such ratio or requirement made before and
after giving effect to such change in GAAP.
(g)References herein to “fiscal year” refer to the fiscal year of Borrower.
(h)Any financial ratios required to be maintained by Borrower pursuant to the
Loan Documents shall be calculated by dividing the appropriate component by the
other component, carrying the result to one place more than the number of places
by which such ratio is expressed herein and rounding the result up or down to
the nearest number using the common - or symmetric arithmetic - method of
rounding (in other words, rounding-up if there is no nearest number).
WEST\258948078.15    15
ARTICLE II

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CREDIT TERMS
SECTION 2.1 REVOLVING LINE OF CREDIT.
(a)Revolving Line of Credit. Subject to the terms and conditions of this
Agreement, Bank hereby agrees to make loans (each such loan, a “Revolving Credit
Loan”) to Borrower from time to time on any Business Day during the Availability
Period, not to exceed at any time the aggregate principal amount of Twenty-Five
Million Dollars ($25,000,000.00) (the “Revolving Line of Credit”), provided,
however, that Bank shall determine, in its sole and absolute discretion, whether
to fund a Revolving Credit Loan once requested, but in no event shall Bank be
required to do so. The proceeds under the Revolving Line of Credit shall be used
for working capital and general corporate purposes. Borrower’s obligation to
repay advances under the Revolving Line of Credit shall be evidenced by a
promissory note dated October 9, 2015 (as amended, restated, supplemented or
otherwise modified from time to time, the “Revolving Credit Note”), in the form
attached hereto as Exhibit A-1, all terms of which are incorporated herein by
this reference.
(b)Borrowing and Repayment. Borrower may from time to time during the
Availability Period, partially or wholly repay its outstanding borrowings under
the Revolving Line of Credit, and reborrow, subject to all of the limitations,
terms and conditions contained herein; provided that, the total outstanding
borrowings under the Revolving Line of Credit shall not at any time exceed the
maximum principal amount available thereunder, as set forth above. On the
Revolving Credit Maturity Date, Borrower shall repay to Bank in full the
aggregate outstanding principal balance of all Revolving Credit Loans, together
with all accrued and unpaid interest due thereon.
SECTION 2.2 PROCEDURES FOR BORROWING.
(a)Each Revolving Credit Borrowing, each conversion of Loans from one Type to
the other and each continuation of LIBOR Loans shall be made upon Borrower’s
irrevocable notice to Bank, which may be given by telephone or by approved
electronic communications. Each such notice must be received by Bank not later
than 11:00 a.m. at least five (5) Business Days prior to the date the Revolving
Credit Loans are to be advanced, otherwise with respect to a conversion of Loans
from one Type to the other or a continuation of LIBOR Loans, on the requested
date of any such conversion or continuation. Notwithstanding anything to the
contrary contained herein, any telephonic notice or other electronic
communication by Borrower pursuant to this Section 2.2(a) may be given by an
individual who has been authorized in writing to do so by an appropriate
Responsible Officer of Borrower. Each such telephonic notice or other electronic
communication must be confirmed promptly by delivery to Bank of a written Loan
Notice, appropriately completed and signed by an appropriate Responsible Officer
of Borrower.
(b)Each Revolving Credit Borrowing of, conversion to or continuation of LIBOR
Loans shall be in a principal amount of $1,000,000 or a whole multiple of
$100,000 in excess thereof. Each Revolving Credit Borrowing of or conversion to
Base Rate Loans shall be in a principal amount of $1,000,000 or a whole multiple
of $100,000 in excess thereof.
(c)Each Loan Notice (whether telephonic or written) shall specify: (i) whether
Borrower is requesting: (A) a Revolving Credit Borrowing; (B) a conversion of
outstanding Loans from one Type to the other; or (C) a continuation of LIBOR
Loans; (ii) the requested date of such Revolving Credit Borrowing, conversion or
continuation, as the case may be (which shall be a Business Day); (iii) the
principal amount of the Loans to be borrowed, converted or continued; (iv) the
Type of Loans to be borrowed or to which existing Loans are to be converted;
WEST\258948078.15    16
and (v) if applicable, the duration of the Interest Period with respect thereto.
If Borrower fails to specify a Type of Loan in a Loan Notice or if Borrower
fails to give a timely notice requesting a conversion or continuation, then the
applicable Loan(s) shall be made as, or converted to, Base Rate Loans. Any such
automatic conversion to Base Rate Loans shall be effective as of the last day of
the Interest Period then in effect with respect to the applicable LIBOR Loans.
If Borrower requests a Revolving Credit Borrowing of, conversion to, or
continuation of LIBOR Loans in any such Loan Notice, but fails to specify an
Interest Period, it will be deemed to have specified an Interest Period of one
month.
(a)Except as otherwise provided herein, a LIBOR Loan may be continued or
converted only on the last day of an Interest Period for such LIBOR Loan. During
the existence of an Event of Default: (i) no Loans may be requested as,
converted to or continued as LIBOR Loans without the consent of Bank; and (ii)
Bank may demand that any or all of the then outstanding Revolving Credit Loans
that are LIBOR Loans be

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converted immediately to Base Rate Loans, whereupon Borrower shall pay any
amounts due under Section 3.4 in accordance with the terms thereof due to any
such conversion.
(b)Bank shall promptly notify Borrower of the interest rate applicable to any
Interest Period for LIBOR Loans upon determination of such interest rate.
(c)After giving effect to all Revolving Credit Borrowings, all conversions of
Loans from one Type to the other, and all continuations of Loans as the same
Type, there shall not be more than five Interest Periods in effect with respect
to the Revolving Credit Loans.
SECTION 2.3 PRINCIPAL PAYMENTS AND PREPAYMENTS. Borrower may, upon notice to
Bank, at any time or from time to time voluntarily prepay Loans in whole or in
part without premium or penalty but subject to Section 3.4; provided that: (A)
such notice must be received by Bank not later than 11:00 a.m.: (1) three
Business Days prior to any date of prepayment of Loans that are LIBOR Loans; and
(2) one Business Day prior to the date of prepayment of Loans that are Base Rate
Loans; and (B) any prepayment of any Loans that are: (1) LIBOR Loans shall be in
a principal amount of $1,000,000 or a whole multiple of $1,000,000 in excess
thereof, or, if less, the entire principal amount thereof then outstanding; and
(2) Base Rate Loans shall be in a principal amount of $1,000,000 or a whole
multiple of $1,000,000 in excess thereof, or, if less, the entire principal
amount thereof then outstanding. Each such notice shall specify the date and
amount of such prepayment and the Type(s) of Loans to be prepaid. If Borrower
gives such notice, then Borrower’s prepayment obligation shall be irrevocable,
and Borrower shall make such prepayment and the payment amount specified in such
notice shall be due and payable on the date specified therein. Any prepayment of
a Loan that is a LIBOR Loan shall be accompanied by all accrued interest on the
amount prepaid, together with any additional amounts required pursuant to
Section 3.4.
SECTION 2.4 INTEREST/APPLICABLE RATES.
(a)Subject to the provisions of subsection Section 2.4(b): (i) each LIBOR Loan
shall bear interest on the outstanding principal amount thereof for each
Interest Period at a rate per annum equal to LIBOR for such Interest Period plus
the Applicable Rate; and (ii) each Base Rate Loan shall bear interest on the
outstanding principal amount thereof from the applicable borrowing date at a
rate per annum equal to the Base Rate.
(b)(i) If any amount of principal of any Loan is not paid when due (without
regard to any applicable grace periods), whether at stated maturity, by
acceleration or otherwise, such
WEST\258948078.15    17
amount shall thereafter bear interest at a fluctuating interest rate per annum
at all times equal to the Default Rate to the fullest extent permitted by
applicable Laws.
(i)If any amount (other than principal of any Loan) payable by Borrower under
any Loan Document is not paid when due (without regard to any applicable grace
periods), whether at stated maturity, by acceleration or otherwise, then such
amount shall thereafter bear interest at a fluctuating interest rate per annum
at all times equal to the Default Rate to the fullest extent permitted by
applicable Laws.
(ii)While any Event of Default exists, Borrower shall pay interest on the
principal amount of all outstanding Obligations hereunder at a fluctuating
interest rate per annum at all times equal to the Default Rate to the fullest
extent permitted by applicable Laws.
(iii)Accrued and unpaid interest on past due amounts (including interest on past
due interest) shall be due and payable upon demand.
(a)Interest on each Loan shall be due and payable in arrears on each Interest
Payment Date applicable thereto and at such other times as may be specified
herein. Interest hereunder shall be due and payable in accordance with the terms
hereof before and after judgment, and before and after the commencement of any
proceeding under any Bankruptcy Law.
SECTION 2.5 Reserved.
SECTION 2.6 COMPUTATIONS OF INTEREST AND FEES. All computations of interest for
Base Rate Loans shall be made on the basis of a year of 365 or 366 days, as the
case may be, and actual days elapsed. All other computations of interest and
fees hereunder shall be made on the basis of a year of 360 days and actual days
elapsed. Interest shall accrue on each Loan for the day on which the Loan is
made, and shall not accrue on a Loan, or any portion thereof, for the day on
which the Loan or such portion is paid, provided that any Loan that is repaid on
the same day on which

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it is made shall bear interest for one day. Each determination by Bank of an
interest rate or fee hereunder shall be conclusive and binding for all purposes,
absent manifest error.
SECTION 2.7 PAYMENTS GENERALLY; COLLECTION OF PAYMENTS.
(a)General. All payments to be made by Borrower shall be made without condition
or deduction for any counterclaim, defense, recoupment or setoff. Except as
otherwise expressly provided herein, all payments by Borrower hereunder shall be
made to Bank in Dollars and in immediately available funds not later than 4:00
p.m. on the date specified herein. All payments received by Bank after 4:00 p.m.
shall be deemed received on the next succeeding Business Day and any applicable
interest or fee shall continue to accrue. If any payment to be made by Borrower
shall come due on a day other than a Business Day, payment shall be made on the
next following Business Day, and such extension of time shall be reflected in
computing interest or fees, as the case may be.
(b)Collection of Payments. Borrower authorizes Bank to collect all principal,
interest and fees due under each credit created by the Loan Documents by
charging Borrower’s deposit account number 30978966 with Bank, or any other
deposit account maintained by Borrower with Bank, for the full amount thereof.
Should there be insufficient funds in any such deposit account to pay all such
sums when due, the full amount of such deficiency shall be immediately due and
payable by Borrower.
WEST\258948078.15    18
SECTION 2.8 COLLATERAL. As security for all indebtedness of Borrower to Bank
created by the Loan Documents, Borrower hereby grants to Bank security interests
of first priority (except for Permitted Liens that are senior to Bank’s security
interests), and shall cause each Material Domestic Subsidiary to grant to Bank
security interests of first priority, in all of Borrower’s and each such
Material Domestic Subsidiary’s personal property (including, without limitation,
all of Borrower’s ownership interests in Subsidiaries, accounts receivable,
inventory, equipment and intellectual property now owned or hereafter acquired),
but excluding interests as a lessee under real property and personal property
leases and shares of voting stock of each Foreign Subsidiary that represent more
than 65% of the voting stock of such Foreign Subsidiary.
As additional security for all indebtedness of Borrower to Bank created by the
Loan Documents, Borrower shall cause each Material Domestic Subsidiary to grant
to Bank security interests of first priority in all such Material Domestic
Subsidiary’s ownership interest in any Material Domestic Subsidiary or Foreign
Subsidiary, but excluding shares of voting stock of each Foreign Subsidiary that
represent more than 65% of the voting stock of such Foreign Subsidiary and, with
respect to each Foreign Subsidiary, subject to the time frames established in
Section 6.12(b) hereof.
All of the foregoing shall be evidenced by and subject to the terms of such
security agreements, financing statements, deeds or mortgages, and other
documents as Bank shall reasonably require, all in form and substance
satisfactory to Bank. Borrower shall reimburse Bank immediately upon demand for
all costs and expenses incurred by Bank in connection with any of the foregoing
security, including without limitation, filing and recording fees and costs of
appraisals, audits and title insurance.
SECTION 2.9 GUARANTIES. Subject to the time frames established in Section
6.12(a) hereof, all Secured Obligations shall be guaranteed jointly and
severally by each Subsidiary Guarantor, as evidenced by and subject to the terms
of this Agreement.
ARTICLE III
INCREASED COSTS; TAXES
SECTION 3.1 INCREASED COSTS.
(a)Increased Costs Generally. If any Change in Law shall: (i) impose, modify or
deem applicable any reserve, special deposit, compulsory loan, insurance charge
or similar requirement against assets of, deposits with or for the account of,
or advances, loans or other credit extended by, Bank (except any reserve
requirement reflected in the LIBOR); (ii) subject Bank to any tax of any kind
whatsoever with respect to this Agreement or any Loan bearing interest at LIBOR
made by it, or change the basis of taxation of payments to Bank in respect
thereof (except for Indemnified Taxes or Other Taxes covered by Section 3.2 and
the imposition

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of, or any change in the rate of any Excluded Tax payable by Bank); or (iii)
impose on Bank or the London interbank market any other condition, cost or
expense affecting this Agreement or any Loan bearing interest at LIBOR made by
Bank; and the result of any of the foregoing shall be to increase the cost to
Bank of making or maintaining any Loan bearing interest at LIBOR (or of
maintaining its obligation to make any such Loan), or to reduce the amount of
any sum received or receivable by Bank hereunder (whether of principal, interest
or any other amount) then, upon written request of Bank, Borrower shall promptly
pay to Bank such additional amount or amounts as will compensate Bank for such
additional costs incurred or reduction suffered.
(b)Capital Requirements. If Bank determines (in good faith and in its reasonable
discretion) that any Change in Law affecting Bank or any lending office of Bank
or Bank’s holding company, if any, regarding capital requirements has or would
have the effect of reducing
WEST\258948078.15    19
the rate of return on Bank’s capital or on the capital of Bank’s holding
company, if any, as a consequence of this Agreement, the Line of Credit or the
Loans made by Bank, to a level below that which Bank or Bank’s holding company
could have achieved but for such Change in Law (taking into consideration Bank’s
policies and the policies of Bank’s holding company with respect to capital
adequacy), then from time to time upon written request of Bank, Borrower shall
promptly pay to Bank such additional amount or amounts as will compensate Bank
or Bank’s holding company for any such reduction suffered.
(a)Certificates for Reimbursement. A certificate of Bank setting forth the
amount or amounts necessary to compensate Bank or its holding company, as the
case may be, as specified in paragraph (a) or (b) of this Section 3.1 and
setting forth in reasonable detail the manner in which such amount or amounts
shall have been determined, shall be delivered to Borrower and shall be
conclusive absent manifest error. Borrower shall pay Bank the amount shown as
due on any such certificate within ten (10) days after receipt thereof.
(b)Delay in Requests. Failure or delay on the part of Bank to demand
compensation pursuant to this Section shall not constitute a waiver of Bank’s
right to demand such compensation; provided that Borrower shall not be required
to compensate Bank pursuant to this Section for any increased costs incurred or
reductions suffered more than nine (9) months prior to the date that Bank
notifies Borrower of the Change in Law giving rise to such increased costs or
reductions and of Bank’s intention to claim compensation therefor (except that
if the Change in Law giving rise to such increased costs or reductions is
retroactive, then the nine-month period referred to above shall be extended to
include the period of retroactive effect thereof).
SECTION 3.2 TAXES.
(a) Any and all payments by Borrower to or for the account of Bank hereunder or
under any other Loan Document shall be made free and clear of and without
deduction or withholding for any and all Taxes, and all liabilities with respect
thereto, now or hereafter imposed, levied, collected, withheld or assessed by
any Governmental Authority, excluding Taxes imposed on its income, receipts,
capital, net worth or items of tax preference and franchise, doing business and
similar Taxes (imposed on it in lieu of net income taxes), that are imposed on
Bank as a result of a present or former connection between Bank and the
jurisdiction of the Governmental Authority imposing such tax or any political
subdivision or taxing authority thereof or therein (other than any such
connection arising solely from Bank having executed, delivered or performed its
obligations or received a payment under, or enforced, this Agreement or any
other Loan Document) (“Excluded Taxes”). If any such non-Excluded Taxes
(“Indemnified Taxes”) or Other Taxes (as defined below) are required to be
withheld after the date hereof from or in respect of any sum payable under this
Agreement or any other Loan Document to Bank, (i) the sum payable shall be
increased as necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section 3.2) Bank
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) Borrower shall make such deductions, (iii) Borrower
shall timely pay the full amount deducted to the relevant taxation authority or
other authority in accordance with applicable Laws, and (iv) Borrower shall
furnish to Bank, at its address referred to in Section 9.2, the original or a
certified copy of a receipt evidencing payment thereof or other evidence of
payment reasonably acceptable to Bank; provided that Borrower shall not be
required to increase such amounts payable to Bank with respect to any Taxes (A)
that are attributable to Bank’s failure to comply with the requirements of
paragraph (d) of this Section or (B) that are United States federal withholding
taxes imposed on amounts payable to Bank at the time Bank becomes a party to
this Agreement, or, in the case of an assignment, at the time when the Assignee
becomes a party to this Agreement, except to the

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WEST\258948078.15    20
extent that Bank’s assignor (if any) was entitled, at the time of assignment, to
receive additional amounts from Borrower with respect to such Taxes pursuant to
this paragraph.
(a)In addition, Borrower agrees to timely pay any and all present or future
stamp, property, recording, excise and documentary taxes which arise from the
execution or delivery of this Agreement or any other Loan Document or the
provision of the security interest in any Collateral required hereunder
(hereinafter referred to as “Other Taxes”).
(b)Borrower agrees to indemnify Bank for the full amount of Indemnified Taxes
and Other Taxes (including any Indemnified Taxes or Other Taxes imposed or
asserted by any jurisdiction on amounts payable under this Section 3.2) paid by
Bank and any liability (including penalties, interest, and reasonable expenses)
arising therefrom or with respect thereto.
(c)Bank, on or prior to the Closing Date, and from time to time thereafter if
requested in writing by Borrower, shall provide Borrower with (i) a complete and
properly executed IRS Form W-8BEN, W-8ECI or W-8IMY (including all required
accompanying information), as appropriate, or any successor form prescribed by
the IRS (including a United States taxpayer identification number), certifying
that Bank is entitled to benefits under an income tax treaty to which the United
States is a party that reduces the rate of withholding tax on payments of
interest, certifying that such Person is eligible for the “portfolio interest
exemption” or certifying that the income receivable pursuant to this Agreement
is effectively connected with the conduct of a trade or business in the United
States or (ii) an IRS Form W-9 or any successor form prescribed by the IRS. In
addition, Bank will (A) take all actions reasonably requested in good faith by
Borrower in writing that are consistent with applicable legal and regulatory
restrictions to claim any available reductions or exemptions from Indemnified
Taxes or Other Taxes and (B) otherwise cooperate with Borrower to minimize any
amounts payable by Borrower under this Section 3.2; provided that, in each case,
any out-of-pocket cost relating directly to such action or cooperation requested
by Borrower shall be borne by Borrower, and Bank shall not be required to take
any action that it determines in its sole good faith discretion may be adverse
in any non de minimis respect to it and not indemnified to its satisfaction.
(d)Without prejudice to the survival of any other agreement of Borrower
hereunder, the agreements and obligations of Borrower contained in this Section
3.2 shall survive the payment in full of all obligations under this Agreement
and the other Loan Documents.
SECTION 3.3 INABILITY TO DETERMINE RATES. If Bank determines in connection with
any request for a Loan or continuation thereof that (a) Dollar deposits are not
being offered to banks in the London interbank offered market for the applicable
amount and Interest Period of such Loan, (b) adequate and reasonable means do
not exist for determining LIBOR for any requested Interest Period with respect
to a proposed Loan, or (c) LIBOR for any requested Interest Period with respect
to a proposed Loan does not adequately and fairly reflect the cost to Bank of
funding such Loan, then Bank will promptly so notify Borrower. Thereafter, the
obligation of Bank to make or maintain Loans shall be suspended until Bank
revokes such notice. Upon receipt of such notice, Borrower may revoke any
pending request for a Revolving Credit Borrowing or continuation of Loans or,
failing that, will be deemed to have converted such request into a request for a
Revolving Credit Borrowing consisting of Base Rate Loans in the amount specified
therein.
SECTION 3.4 COMPENSATION FOR LOSSES. Upon demand of Bank from time to time,
Borrower shall promptly compensate Bank for and hold Bank harmless from any
loss, cost or expense incurred by it as a result of:
WEST\258948078.15    21
(a)any continuation, conversion, payment or prepayment of any Loan other than a
Base Rate Loan on a day other than the last day of the Interest Period for such
Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or
otherwise); or
(b)any failure by Borrower (for a reason other than the failure of Bank to make
a Loan) to prepay, borrow, continue or convert any Loan other than a Base Rate
Loan on the date or in the amount notified by Borrower;

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including any loss of anticipated profits and any loss or expense arising from
the liquidation or reemployment of funds obtained by it to maintain such Loan or
from fees payable to terminate the deposits from which such funds were obtained.
Borrower shall also pay any customary administrative fees charged by Bank in
connection with the foregoing. For purposes of calculating amounts payable by
Borrower to Bank under this Section 3.4, Bank shall be deemed to have funded
each LIBOR Loan made by it by a matching deposit or other borrowing in the
London interbank offered market for a comparable amount and for a comparable
period, whether or not such LIBOR Loan was in fact so funded.
SECTION 3.5 SURVIVAL. All obligations of Borrower under this Article III shall
survive repayment, satisfaction or discharge of all the Obligations.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Borrower makes the following representations and warranties to Bank, which
representations and warranties shall survive the execution of this Agreement and
shall continue in full force and effect until the full and final payment, and
satisfaction and discharge, of all obligations of Borrower to Bank created by
the Loan Documents.
SECTION 4.1 LEGAL STATUS. Borrower and each of its Subsidiaries, and each
Subsidiary of a Subsidiary, is a corporation, partnership or limited liability
company, duly organized and existing and in good standing under the Laws of the
jurisdiction of its incorporation, organization or formation, and is qualified
or licensed to do business (and is in good standing as a foreign entity, if
applicable) in all jurisdictions in which such qualification or licensing is
required or in which the failure to so qualify or to be so licensed would
reasonably be expected to have a Material Adverse Effect. All of the
Subsidiaries of Borrower in existence as of the Closing Date are listed on
Schedule 4.1 hereto.
SECTION 4.2 AUTHORIZATION AND VALIDITY. This Agreement and each of the Loan
Documents have been duly authorized, and upon their execution and delivery in
accordance with the provisions hereof will constitute legal, valid and binding
agreements and obligations of Borrower or the party which executes the same,
enforceable in accordance with their respective terms.
SECTION 4.3 NO VIOLATION. The execution, delivery and performance by Borrower
and the Guarantors of each of the Loan Documents do not violate any provision of
any Law, or contravene any provision of such Person’s organizational documents,
or result in any breach of or default under any contract, obligation, indenture
or other instrument to which any such Person is a party or may be bound which
violation contravention, breach or default would individually or in the
aggregate reasonably be expected to have a Material Adverse Effect.
SECTION 4.4 LITIGATION. There are no pending, or to the best of Borrower’s
knowledge threatened, actions, claims, investigations, suits or proceedings by
or before any governmental authority, arbitrator, court or administrative
agency, against Borrower, any Subsidiary, or any Subsidiary of a
WEST\258948078.15    22
Subsidiary, which would reasonably be expected to have a Material Adverse
Effect, other than those disclosed on Schedule 4.4.
SECTION 4.5 CORRECTNESS OF FINANCIAL STATEMENT. The consolidated financial
statement of Borrower dated December 31, 2014, a true copy of which has been
delivered by Borrower to Bank prior to the date hereof, (a) is complete and
correct and presents fairly the financial condition of Borrower, (b) discloses
all liabilities of Borrower that are required to be reflected or reserved
against under GAAP, whether liquidated or unliquidated, fixed or contingent, and
(c) has been prepared in accordance with GAAP. Since the date of such financial
statement there has been no material adverse change in the financial condition
of Borrower, nor (exclusive of Permitted Liens) has Borrower mortgaged, pledged,
granted a security interest in or otherwise encumbered any of its assets or
properties except in favor of Bank or as otherwise permitted by Bank in writing.

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SECTION 4.6 INCOME TAX RETURNS. Borrower has no knowledge of any pending
assessments or adjustments of its income tax payable with respect to any year.
SECTION 4.7 NO SUBORDINATION. There is no agreement, indenture, contract or
instrument to which Borrower is a party or by which Borrower may be bound that
requires the subordination in right of payment of any of Borrower’s or any
Guarantor’s obligations created by the Loan Documents to any other obligation of
Borrower or such Guarantor.
SECTION 4.8 PERMITS, FRANCHISES. Borrower and each of its Subsidiaries, and each
Subsidiary of a Subsidiary, possess, and will hereafter possess, all permits,
consents, approvals, franchises and licenses required and rights to all
trademarks, trade names, patents, and fictitious names, if any, necessary to
enable it to conduct the business in which it is now engaged in compliance with
applicable Law.
SECTION 4.9 ERISA COMPLIANCE. As of the Closing Date: (a) each Plan is in
compliance with the applicable provisions of ERISA, the Code and other federal
or state Law. Each Plan which is intended to qualify under subsection 401(a) of
the Code has received a favorable determination letter from the Internal Revenue
Service and nothing has occurred that would cause the loss of such
qualification. As of the Closing Date, Borrower and each ERISA Affiliate have
made all required contributions to any Plan subject to Section 412 of the Code,
and no application for a funding waiver or an extension of any amortization
period pursuant to Section 412 of the Code has been made with respect to any
Plan; (b) there are no pending or, to the best knowledge of Borrower, threatened
claims, actions or lawsuits, or action by any Governmental Authority. As of the
Closing Date, there has been no prohibited transaction or violation of the
fiduciary responsibility rules with respect to any Plan; and (c) (i) no ERISA
Event has occurred or is reasonably expected to occur; and (ii) no event or
circumstance has occurred or exists that, if such event or circumstance had
occurred or arisen after the Closing Date, would create an Event of Default
under Section 8.1(j).
SECTION 4.10 OTHER OBLIGATIONS. None of Borrower or any Subsidiary (including
any Subsidiary of a Subsidiary) is in default on any obligation for borrowed
money, any purchase money obligation or any other material lease, commitment,
contract, instrument or obligation.
SECTION 4.11 ENVIRONMENTAL MATTERS. Except as disclosed on Schedule 4.11,
Borrower is in compliance in all material respects with all applicable federal
or state environmental, hazardous waste, health and safety statutes, and any
rules or regulations adopted pursuant thereto, which govern or affect any of
Borrower’s operations and/or properties, including without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act of 1980,
the Superfund Amendments and Reauthorization Act of 1986, the Federal Resource
Conservation and Recovery Act of 1976, and the
WEST\258948078.15    23
Federal Toxic Substances Control Act, as any of the same may be amended,
modified or supplemented from time to time. None of the operations of Borrower
is the subject of any federal or state investigation evaluating whether any
remedial action involving a material expenditure is needed to respond to a
release of any toxic or hazardous waste or substance into the environment.
Borrower has no material contingent liability in connection with any release of
any toxic or hazardous waste or substance into the environment.
SECTION 4.12 HEALTH CARE AND FDA MATTERS. Except, in each case, as may be
disclosed on Schedule 4.12:
(a)The Borrower and each of its Subsidiaries, and each of their respective
employees and contractors solely with respect to the exercise of their
respective duties on behalf of the Borrower or its Subsidiaries, are in
compliance in all material respects with all applicable Health Care Laws.
Neither the Borrower nor any of the Subsidiaries have received written notice of
any pending or, to the Borrower’s or any Subsidiaries’ knowledge, threatened
claim, suit, proceeding, hearing, enforcement, audit, inspection, investigation,
seizure, shutdown, field action, recall, untitled letter, warning letter (other
than that certain Warning Letter, dated April 10, 2015, from the U.S. Food and
Drug Administration (the “FDA”) to the Borrower (the “FDA Warning Letter”)),
with respect to non-compliance, arbitration or other action from any applicable

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Governmental Authority or applicable foreign regulatory agency, alleging that
any operation or activity of the Borrower or any Subsidiary is in material
violation of any applicable Health Care Law.
(b)The Borrower and each of its Subsidiary owns, holds or possesses all
licenses, franchises, permits, privileges, variances, immunities, approvals,
clearances and other authorizations from Governmental Authorities that are
necessary to entitle it to own or lease, operate and use its properties and
assets and to carry on and conduct its business substantially as conducted,
except for such incidental licenses, permits and other authorizations which
would be readily obtainable by any qualified applicant without undue burden in
the event of any lapse, termination, cancellation or forfeiture thereof
(collectively, the “Health Care Permits”), and all such Health Care Permits are
in full force and effect.
(c)None of the Borrower, its Subsidiaries, or their respective officers,
directors, equity holders of 5% or more, employees, agents or contractors is
currently, or has in the past been, excluded from participation in any Federal
Health Care Program pursuant to any applicable Health Care Laws, including,
without limitation, 42 U.S.C. § 1320a-7.
(d)Neither the Borrower nor any Subsidiary has knowingly and willfully offered,
paid, solicited or received any remuneration (including any kickback, bribe or
rebate), directly or indirectly, overtly or covertly, in cash or in kind in
return for, or to induce, the purchase, lease or order, or the arranging for or
recommending of the purchase, lease or order, of any good, facility, item, or
service for which payment may be made in whole or in part under any Federal
Health Care Program.
(e)There are no pending or, to the knowledge of the Borrower or any Subsidiary,
threatened material inquiries, inspections, audits, overpayments, qui tam
actions, appeals, investigations or claims or other actions which relate to a
material violation of any Health Care Laws or which, if resolved in a manner
adverse to the Borrower or its Subsidiaries, would result in the imposition of
any material penalties, restrict their ability to conduct the business as
currently conducted in any material respect, or their exclusion from
participation in any Federal Health Care Program, and none of the Borrower or
its Subsidiaries is currently a party to a corporate integrity agreement,
deferred prosecution agreement, consent decree, settlement
WEST\258948078.15    24
agreement or similar agreements or orders mandating or prohibiting future or
past activities, or has any reporting obligations pursuant to a settlement
agreement, plan or correction or other remedial measure entered into with any
Governmental Authority.
(f) Neither the Borrower nor any of its Subsidiaries has received any warning or
untitled letter (other than the FDA Warning Letter) from the FDA or equivalent
action from any comparable non-United States Governmental Authority. Neither the
Borrower nor any of its Subsidiaries has received any communication from any
regulatory agency or been notified that any product approval or clearance
granted to it is withdrawn or modified or that such an action is under
consideration. Without limiting the foregoing, the Borrower and each of its
Subsidiaries is in compliance, in all material respects, with all current
applicable statutes, rules, regulations, or orders administered or issued by the
FDA, including the Federal Food, Drug, and Cosmetic Act and Public Health
Service Act. There have been no recalls, detentions, withdrawals, seizures, or
termination or suspension of manufacturing voluntarily undertaken, requested or
threatened relating to any of the Borrower’s or any of its Subsidiaries’
products.
ARTICLE V
CONDITIONS
SECTION 5.1 CONDITIONS OF INITIAL EXTENSION OF CREDIT. The obligation of Bank to
extend any credit contemplated by this Agreement is subject to the fulfillment
to Bank’s satisfaction of all of the following conditions:
(a)Approval of Bank Counsel. All legal matters incidental to the extension of
credit by Bank shall be satisfactory to Bank’s counsel.
(b)Documentation. Bank shall have received, in form and substance satisfactory
to Bank, each of the following, duly executed:
(i)this Agreement and the Revolving Credit Note;
(ii)the Security Agreement and the Pledge Agreement duly executed and delivered
and describing the personal property collateral referred to in Section 2.8
hereof;

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(iii)such certificates of resolutions or other action, incumbency certificates
or other certificates of Responsible Officers of each of Borrower and each
Guarantor as Bank may reasonably require evidencing the identity, authority and
capacity of each Responsible Officer thereof authorized to act as a Responsible
Officer in connection with the Loan Documents to which such Person is a party;
(iv)such documents and certifications as Bank may reasonably require to evidence
that Borrower and each Guarantor is duly organized or formed, and is validly
existing, in good standing and qualified to engage in business in: (A) the State
of California; and (B) each jurisdiction where its ownership, lease or operation
of properties or the conduct of its business requires such qualification, except
to the extent that failure to do so could not reasonably be expected to have a
Material Adverse Effect;
(v)such other documents as Bank may require under any other Section of this
Agreement; and
WEST\258948078.15    25
(vi)    Borrower shall deliver to Bank a legal opinion of counsel to Borrower in
form and substance satisfactory to Bank.
(a)Financial Condition. There shall have been no material adverse change, as
determined by Bank, in the financial condition or business of Borrower and its
Subsidiaries, nor any material decline, as determined by Bank, in the market
value of any collateral required hereunder or a substantial or material portion
of the assets of Borrower.
(b)Insurance. Borrower shall have delivered to Bank evidence of insurance
coverage on all Borrower’s property, in form, substance, amounts, covering risks
and issued by companies satisfactory to Bank, and where required by Bank, with
loss payable endorsements in favor of Bank.
(c)Due Diligence. Bank shall have completed its due diligence review of Borrower
and its Subsidiaries, with the result of such review satisfactory to Bank, which
review may include a review of Borrower’s and its Subsidiaries assets, financial
condition and prospects.
(d)Accounts. Borrower shall have delivered to Bank evidence that Borrower
maintains all of its principal depository, operating and investment accounts
with Bank.
(e)Payoff of Existing Indebtedness. Borrower shall have delivered Bank a payoff
letter evidencing the payoff and termination of the Existing Indebtedness and
corresponding UCC termination statements with respect to any liens granted in
connection with the Existing Indebtedness, in each case satisfactory to Bank.
SECTION 5.2 CONDITIONS OF EACH EXTENSION OF CREDIT. The obligation of Bank to
make each extension of credit requested by Borrower hereunder shall be subject
to the fulfillment to Bank’s satisfaction of each of the following conditions:
(a)Compliance. The representations and warranties contained herein and in each
of the other Loan Documents shall be true on and as of the date of the signing
of this Agreement and on the date of each extension of credit by Bank pursuant
hereto, with the same effect as though such representations and warranties had
been made on and as of each such date, and on each such date, no Event of
Default as defined herein, and no condition, event or act which with the giving
of notice or the passage of time or both would constitute such an Event of
Default, shall have occurred and be continuing or shall exist.
(b)Documentation. Bank shall have received all additional documents that may be
required in connection with such extension of credit.
ARTICLE VI
AFFIRMATIVE COVENANTS
Borrower covenants that until the termination of this Agreement (other than with
respect to contingent indemnification obligations under Section 9.3) when all
monetary Obligations (including, without commitment, the repayment of Loans)
have been satisfied in full, Borrower shall, and shall (except in the case of
the covenants set forth in Section 6.3 and Section 6.10) cause each of its
Subsidiaries (including Subsidiaries of Subsidiaries) to, unless Bank otherwise
consents in writing:

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WEST\258948078.15    26
SECTION 6.1 PUNCTUAL PAYMENTS. Punctually pay all principal, interest, fees or
other liabilities due under any of the Loan Documents at the times and place and
in the manner specified therein.
SECTION 6.2 ACCOUNTING RECORDS; COLLATERAL EXAMS. Maintain adequate books and
records in accordance with GAAP, and permit any representative of Bank, at any
reasonable time, to inspect, audit and examine such books and records, to make
copies of the same, and to inspect its properties. From time to time, as Bank
shall require in the exercise of its reasonable discretion, permit Bank, or its
employees, accountants, attorneys or agents, to conduct, with respect to each
such Person, examinations and inspections of any collateral required hereby or
any other property of Borrower or such Subsidiary, as applicable. Such
examination and inspection shall be conducted during ordinary business hours and
upon one Business Day’s advance notice (unless an Event of Default shall have
occurred and be continuing, in which case no notice shall be required).
SECTION 6.3 FINANCIAL STATEMENTS. Provide to Bank all of the following, in form
and detail satisfactory to Bank:
(a)not later than 90 days after and as of the end of each fiscal year, audited
annual consolidated and consolidating financial statements of Borrower examined
by, and with the unqualified opinion of, independent certified public
accountants selected by Borrower and acceptable to Bank, which financial
statements shall include Borrower’s balance sheet as of the end of such fiscal
year and the related statements of Borrower’s income, reconciliation of retained
earnings and cash flows for the fiscal year then ended, all in reasonable detail
and prepared in accordance with GAAP;
(b)promptly after the sending or filing thereof, but in no event later than 45
days after the end of each fiscal quarter of Borrower (other than the fourth
fiscal quarter in each fiscal year), copies of each Form 10-Q report filed by
Borrower with the United States Securities and Exchange Commission or any
successor agency; and (ii) concurrently with the sending or filing thereof of
each Form 10-Q report filed by Borrower with the United States Securities and
Exchange Commission or any successor agency and in no event later than 45 days
after the end of each fiscal quarter of Borrower (other than the fourth fiscal
quarter in each fiscal year), consolidating financial statements of Borrower,
prepared by Borrower, which financial statements shall include Borrower’s
balance sheet as of the end of such fiscal quarter and the related statements of
Borrower’s income, reconciliation of retained earnings and cash flows for the
fiscal quarter then ended, all in reasonable detail and prepared in accordance
with GAAP;
(c)concurrently with the delivery of the financial statements referred to in
subsections (a) and (b) of this Section , a duly completed Compliance
Certificate signed by an appropriate Responsible Officer of Borrower; and
(d)from time to time such other information as Bank may reasonably request.
SECTION 6.4 COMPLIANCE. Preserve and maintain all licenses, permits,
governmental approvals, rights, privileges and franchises necessary for the
conduct of its business; and comply with the provisions of all documents
pursuant to which it is organized and/or which govern its continued existence
and with the requirements of all Laws (including Health Care Laws) applicable to
it and/or its business.
SECTION 6.5 INSURANCE. Maintain and keep in force insurance of the types and in
amounts customarily carried in lines of business similar to that of such Person,
including but not limited to fire, extended coverage, public liability, flood,
property damage and workers’ compensation, with all such
WEST\258948078.15    27
insurance carried with companies and in amounts satisfactory to Bank, and
deliver to Bank from time to time at Bank’s request schedules setting forth all
insurance then in effect.
SECTION 6.6 FACILITIES. Keep all properties useful or necessary to such Person’s
business in good repair and condition, and from time to time make necessary
repairs, renewals and replacements thereto so that such properties shall be
fully and efficiently preserved and maintained.

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SECTION 6.7 TAXES AND OTHER LIABILITIES. Pay and discharge when due any and all
indebtedness, obligations, assessments and taxes, both real or personal,
including without limitation federal and state income taxes and state and local
property taxes and assessments, except such (a) as such Person may in good faith
contest or as to which a bona fide dispute may arise, and (b) for which such
Person has made provision, to Bank’s satisfaction, for eventual payment thereof
in the event such Person is obligated to make such payment.
SECTION 6.8 LITIGATION. Promptly give notice in writing to Bank of any
litigation pending or threatened against Borrower or any of its Subsidiaries
with a claim known to be in excess of $250,000.00.
SECTION 6.9 FINANCIAL CONDITION. Maintain Borrower’s financial condition as
follows using GAAP (except to the extent modified by the definitions herein),
with compliance determined commencing with Borrower’s financial statements for
the period ending September 30, 2015:
(a)As of each fiscal quarter end of Borrower, Consolidated Leverage Ratio,
determined on a rolling four-quarter basis, not more than 2.00 to 1.00.
(b)As of each fiscal quarter end of Borrower, Debt Service Coverage Ratio not
less than 1.75:1.00.
SECTION 6.10 NOTICE TO BANK. Promptly (but in no event more than five (5)
business days after a Responsible Officer becomes, or should become, aware of
the occurrence of each such event or matter) give written notice to Bank in
reasonable detail of: (a) the occurrence of any Event of Default, or any
condition, event or act which with the giving of notice or the passage of time
or both would constitute an Event of Default; (b) any change in the name or the
organizational structure of Borrower; (c) the occurrence and nature of any
Reportable Event or Prohibited Transaction, each as defined in ERISA, or any
funding deficiency with respect to any Plan; or (d) any termination or
cancellation of any insurance policy which Borrower is required to maintain, or
any uninsured or partially uninsured loss through liability or property damage,
or through fire, theft or any other cause affecting Borrower’s property in
excess of an aggregate of $250,000.00.
SECTION 6.11 MAINTENANCE OF ACCOUNTS WITH BANK. At all times maintain its
primary depository accounts with Bank pursuant to account agreements and terms
mutually acceptable to such Person and Bank.
SECTION 6.12 SUBSIDIARIES.
(a) Domestic Subsidiaries. By not later than (i) with respect to each Material
Domestic Subsidiary in existence as of the Closing Date, the Closing Date and
(ii) with respect to each Material Domestic Subsidiary formed or acquired on or
after the Closing Date, thirty (30) calendar days after the formation or
acquisition of such Material Domestic Subsidiary, cause such Material Domestic
Subsidiary to execute and deliver to Bank (A) a Joinder Agreement in
satisfaction of the requirements of Section 2.9 hereof, (B) a Security Agreement
(or joinder thereto) and, if pledging ownership interests in another entity, a
Pledge Agreement (or joinder
WEST\258948078.15    28
thereto) in satisfaction of the requirements of Section 2.8 hereof and (C) such
other documents as Bank shall reasonably request, in form and substance
satisfactory to Bank, evidencing the authority of such Material Domestic
Subsidiary to execute and deliver such Joinder Agreement, Security Agreement (or
joinder thereto) and Pledge Agreement (or joinder thereto), and the incumbency
of the Persons executing such Joinder, Security Agreement (or joinder thereto)
and Pledge Agreement (or joinder thereto) on behalf of such Material Domestic
Subsidiary.
(a)Foreign Subsidiaries. By not later than (i) with respect to each Foreign
Subsidiary in existence as of the Closing Date and owned, in whole or in part,
by Borrower or a Material Domestic Subsidiary, the Closing Date and (ii) with
respect to each Foreign Subsidiary formed or acquired on or after the Closing
Date and owned, in whole or in part, by Borrower or a Material Domestic
Subsidiary, forty-five (45) calendar days after the formation or acquisition of
such Foreign Subsidiary, execute, or cause to be executed, a Pledge Agreement
and such further agreements, documents or instruments, or take such other
actions, as Bank

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reasonably deems necessary in order to effectuate the pledge to Bank of security
interests in Borrower’s, and/or Borrower’s Domestic Subsidiaries’, ownership
interest in such Foreign Subsidiary (such pledge exclusive of shares of voting
stock of such Foreign Subsidiary that represent more than 65% of the voting
stock of such Foreign Subsidiary, as described in Section 2.8 hereof),
including, without limitation, (A) executing and delivering to each such Foreign
Subsidiary, a notice of the pledge of Borrower’s and/or Borrower’s Subsidiaries’
interests therein to Bank, and (B) causing such Foreign Subsidiary to execute
and deliver to Bank an acknowledgment of pledge related to Borrower’s and/or
such Subsidiaries’ pledge of its or their interest in such Foreign Subsidiary,
in each case, in form in substance satisfactory to Bank.
(b)Upon the request of Bank, with respect to Borrower’s ownership interests in
Subsidiaries pledged to Bank as collateral under the Loan Documents, Borrower
shall promptly deliver stock certificates (or other comparable certificates) for
all certificated securities now or at any time constituting such collateral,
duly endorsed in blank for transfer or accompanied by an appropriate assignment
or assignments or an appropriate undated stock power or powers, in every case
sufficient to transfer title thereto.
SECTION 6.13 HEALTH CARE COVENANTS. The Borrower will, and will cause each of
its Subsidiaries to:
(a)operate and conduct their business in material compliance with all applicable
Health Care Laws;
(b)take all such actions as are necessary and appropriate so that no material
liability with respect to the Health Care Laws may arise;
(c)promptly, and in no case more than five (5) Business Days after any executive
or financial officer of the Borrower or any Subsidiary thereof obtains knowledge
of the existence of (x) any notice which alleges, asserts or is related to any
material noncompliance with any Health Care Law or exclusion or potential
exclusion from any Federal Health Care Program, or (y) any requests or
requirements of a Governmental Authority, notify the Bank and provide copies
upon receipt of all such written claims, complaints, notices or inquiries
regarding compliance with, or liability pursuant to, the Health Care Laws,
accompanied by an explanation of the anticipated effect thereof and any response
thereto; and
(d)provide such information and certifications which the Bank may reasonably
request from time to time to evidence compliance with this Section 6.13.
WEST\258948078.15    29
SECTION 6.14 POST-CLOSING COVENANTS. As promptly as practicable, but in any
event within forty-five (45) days after the Closing Date (or such longer period
of time, at the Bank’s reasonable discretion), Borrower shall terminate each
recorded intellectual property security interest filed in favor of Silicon
Valley Bank.
ARTICLE VII
NEGATIVE COVENANTS
Borrower further covenants that until the termination of this Agreement (other
than with respect to contingent indemnification obligations under Section 9.3)
when all monetary Obligations (including, without commitment, the repayment of
Loans) have been satisfied in full, Borrower will not, and will not permit any
Subsidiary (including Subsidiaries of Subsidiaries) of Borrower to, without
Bank’s prior written consent:
SECTION 7.1 USE OF FUNDS. Use any of the proceeds of any credit extended
hereunder except for the purposes stated in Article II hereof.
SECTION 7.2 CAPITAL EXPENDITURES. Make any additional investment in fixed assets
in any fiscal year such that, after giving effect to such investment, the
aggregate investments in fixed assets in such year made by Borrower and all
Subsidiaries would exceed $10,000,000.00.
SECTION 7.3 LEASE EXPENDITURES. Incur operating lease expense in any fiscal year
such that, after giving effect to such operating lease expense, the aggregate
operating lease expense incurred by Borrower and all Subsidiaries in such year
is in excess of $4,000,000.00.

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SECTION 7.4 OTHER INDEBTEDNESS. Create, incur, assume or permit to exist any
indebtedness resulting from borrowings, loans or advances, whether secured or
unsecured, matured or unmatured, liquidated or unliquidated, joint or several,
other than Permitted Indebtedness.
SECTION 7.5 MERGER, CONSOLIDATION, TRANSFER OF ASSETS. Merge into or consolidate
with any other entity, other than pursuant to a Permitted Investment; make any
substantial change in the nature of such Person’s business as conducted as of
the date hereof; acquire all or substantially all of the assets of any other
entity, other than pursuant to a Permitted Investment; nor sell, lease, transfer
or otherwise dispose of all or a substantial or material portion of such
Person’s assets except in the ordinary course of its business; provided that
Borrower or any Subsidiary may sell, lease or transfer assets to Borrower or any
wholly-owned Material Domestic Subsidiary of Borrower that is a Guarantor.
SECTION 7.6 GUARANTIES. Guarantee or become liable in any way as surety,
endorser (other than as endorser of negotiable instruments for deposit or
collection in the ordinary course of business), accommodation endorser or
otherwise for, nor pledge or hypothecate any assets of such Person as security
for, any liabilities or obligations of any other person or entity, except (a)
any of the foregoing in favor of Bank, and (b) guaranties by Borrower of real
property lease obligations of its Subsidiaries not exceeding in the aggregate
$500,000.00 outstanding at any time.
SECTION 7.7 LOANS, ADVANCES, INVESTMENTS. Make any loans or advances to or
investments in any person or entity, other than Permitted Investments; provided
that, so long as no Event of Default shall have occurred and be continuing,
Borrower shall be permitted to make contractually required earn-out payments
related to a Permitted Acquisition if all of the following conditions shall have
been satisfied at the time of any such earn-out payment: (a) Borrower shall have
provided Bank pro forma financial forecasts of Borrower on a consolidated basis
after giving effect to such payment and covenant compliance calculations
reasonably satisfactory to Bank demonstrating satisfaction of the
WEST\258948078.15    30
condition described in Section 7.7(b); and (b) after giving effect to such
earn-out payment, no Default or Event of Default shall exist, including with
respect to the financial covenants contained in Section 6.9 hereof on a pro
forma basis.
SECTION 7.8 DIVIDENDS, DISTRIBUTIONS. Declare or pay any dividend or
distribution, either in cash, stock or any other property on such Person’s stock
now or hereafter outstanding, nor redeem, retire, repurchase or otherwise
acquire any shares of any class of such Person’s stock now or hereafter
outstanding; provided that each Subsidiary may declare or pay dividends or
distributions to Borrower or any wholly-owned Material Domestic Subsidiary of
Borrower that is a Guarantor; provided further, that so long as no Default or
Event of Default has occurred and is continuing or would result therefrom,
Borrower may pay dividends or distributions in cash in an aggregate amount not
to exceed $5,000,000.00 during the term of this Agreement.
SECTION 7.9 PLEDGE OF ASSETS. Mortgage, pledge, grant or permit to exist a
security interest in, or lien upon, all or any portion of such Person’s assets
now owned or hereafter acquired, other than Permitted Liens.
SECTION 7.10 SALE AND LEASEBACKS. Enter into any arrangement, directly or
indirectly, with any other Person whereby Borrower or such Subsidiary, as
applicable, shall sell or transfer any real or personal property, whether now
owned or hereafter acquired, and then or thereafter rent or lease as lessee such
property or any part thereof or any other property which Borrower or such
Subsidiary, as applicable, intends to use for substantially the same purpose or
purposes as the property being sold or transferred.
SECTION 7.11 TRANSACTIONS WITH AFFILIATES. Enter into any transaction of any
kind with any affiliate of Borrower, irrespective of whether in the ordinary
course of business, other than on fair and reasonable terms substantially as
favorable to Borrower or a Subsidiary of Borrower as would be obtainable by such
Person at the time in a comparable arm’s-length transaction with a Person other
than an affiliate, provided that the foregoing restriction shall not apply to
transactions between or among Borrower or any Guarantor or between or among
Guarantors.

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ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.1 EVENTS OF DEFAULT. The occurrence of any of the following shall
constitute an “Event of Default” under this Agreement:
(a)Borrower shall fail to pay when due any principal, interest, fees or other
amounts payable under any of the Loan Documents; or
(b)Any financial statement or certificate furnished to Bank in connection with,
or any representation or warranty made by Borrower, any Subsidiary or any other
party under this Agreement or any other Loan Document, shall prove to be
incorrect, false or misleading in any material respect when furnished or made;
or
(c)Any default in the performance of or compliance with any obligation,
agreement or other provision contained herein or in any other Loan Document
(other than those referred to in subsections (a) and (b) above), and with
respect to any such default which by its nature can be cured, such default shall
continue for a period of twenty (20) days from the date Borrower receives notice
thereof or any Responsible Officer of Borrower becomes aware thereof; provided
that if the default cannot by its nature be cured within the twenty (20) day
period or cannot after diligent attempts by Borrower be cured within such twenty
(20) day period, and such default is
WEST\258948078.15    31
likely to be cured within a reasonable time, then Borrower shall have an
additional reasonable period (which shall not in any case exceed twenty (20)
days) to attempt to cure such default; provided, further, that during such
additional reasonable time period the failure to have cured such default shall
not be deemed an Event of Default, however, no further advances under the
Revolving Line of Credit will be made; or
(a)Any default in the payment or performance of any material obligation, or any
defined event of default, under the terms of any contract or instrument (other
than any of the Loan Documents) pursuant to which Borrower, any Subsidiary of
Borrower or any general partner or joint venturer in any Borrower or Subsidiary
of Borrower which is a partnership or joint venture (with each such Subsidiary,
general partner and/or joint venturer referred to herein as a “Third Party
Obligor”) has incurred any debt or other material liability to any person or
entity, including Bank, and such default or event shall continue for a period of
time without cure sufficient to permit the acceleration of the maturity of any
such indebtedness or the enforcement of remedies with respect to such liability;
or
(b)The filing of a notice of judgment lien against Borrower or any Third Party
Obligor; or the recording of any abstract of judgment against Borrower or any
Third Party Obligor in any county in which Borrower or such Third Party Obligor
has an interest in real property; or the service of a notice of levy and/or of a
writ of attachment or execution, or other like process, against the assets of
Borrower or any Third Party Obligor; or the entry of a judgment against Borrower
or any Third Party Obligor; and, in any such case, the same shall remain
unsatisfied, unvacated and unstayed pending appeal for a period of twenty (20)
days after the entry thereof; or
(c)Borrower or any Third Party Obligor shall become insolvent, or shall suffer
or consent to or apply for the appointment of a receiver, trustee, custodian or
liquidator of itself or any of its property, or shall generally fail to pay its
debts as they become due, or shall make a general assignment for the benefit of
creditors; Borrower or any Third Party Obligor shall file a voluntary petition
in bankruptcy, or seeking reorganization, in order to effect a plan or other
arrangement with creditors or any other relief under the Bankruptcy Code, or
under any state or federal law granting relief to debtors, whether now or
hereafter in effect; or any involuntary petition or proceeding pursuant to the
Bankruptcy Code or any other applicable state or federal law relating to
bankruptcy, reorganization or other relief for debtors is filed or commenced
against Borrower or any Third Party Obligor and is not dismissed within 45 days
after its filing, or Borrower or any Third Party Obligor shall file an answer
admitting the jurisdiction of the court and the material allegations of any
involuntary petition; or Borrower or any Third Party Obligor shall be
adjudicated a bankrupt, or an order for relief shall be entered against Borrower
or any Third Party Obligor by any court of competent jurisdiction under the
Bankruptcy Code or any other applicable state or federal law relating to
bankruptcy, reorganization or other relief for debtors; or
(d)There shall exist or occur any event or condition which Bank in good faith
believes would reasonably be expected to have a Material Adverse Effect; or
(e)The dissolution or liquidation of any Borrower or Third Party Obligor which
is a corporation, partnership, joint venture or other type of entity; or
Borrower or any such Third Party Obligor, or any of its directors,

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stockholders or members, shall take action seeking to effect the dissolution or
liquidation of such Borrower or Third Party Obligor; or
WEST\258948078.15    32
(a)There shall exist a material deficiency in any collateral required hereunder,
as identified by Bank pursuant to one or more of the collateral examinations and
inspections referenced in Section 6.2 hereof; or
(b)(i) An ERISA Event occurs with respect to a Pension Plan or Multiemployer
Plan which has resulted or could reasonably be expected to result in liability
of Borrower under Title IV of ERISA to the Pension Plan, Multiemployer Plan or
the PBGC in an aggregate amount in excess of $1,000,000; or (ii) Borrower or any
ERISA Affiliate fails to pay when due, after the expiration of any applicable
grace period, any installment payment with respect to its withdrawal liability
under Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in
excess of $1,000,000; or
(c)Any Loan Document or any provision thereof, at any time after its execution
and delivery and for any reason other than as expressly permitted hereunder or
thereunder or satisfaction in full of all the Obligations, ceases to be in full
force and effect; or Borrower or any Subsidiary contests in any manner the
validity or enforceability of any Loan Document or any provision thereof; or
Borrower or any Subsidiary denies that it has any or further liability or
obligation under any Loan Document, or purports to revoke, terminate or rescind
any Loan Document or any provision thereof; or
(d)A Change of Control occurs.
SECTION 8.2 REMEDIES. Upon the occurrence of any Event of Default: (a) all
indebtedness of Borrower under each of the Loan Documents, any term thereof to
the contrary notwithstanding, shall at Bank’s option and without notice become
immediately due and payable without presentment, demand, protest or notice of
dishonor, all of which are hereby expressly waived by each Borrower; (b) the
Bank may immediately cease extending any further credit under any of the Loan
Documents; and (c) Bank shall have all rights, powers and remedies available
under each of the Loan Documents, or accorded by Law, including without
limitation the right to resort to any or all security for any credit created by
the Loan Documents and to exercise any or all of the rights of a beneficiary or
secured party pursuant to applicable Law. All rights, powers and remedies of
Bank may be exercised at any time by Bank and from time to time after the
occurrence of an Event of Default, are cumulative and not exclusive, and shall
be in addition to any other rights, powers or remedies provided by Law or
equity.
SECTION 8.3 APPLICATION OF FUNDS. After the exercise of remedies provided for in
Section 8.02 (or after the Loans have automatically become immediately due and
payable), any amounts received on account of the Secured Obligations shall be
applied by the Bank in the following order:
(a)First, to payment of that portion of the Secured Obligations constituting
fees, indemnities, expenses and other amounts (including fees, charges and
disbursements of counsel to the Bank and amounts payable under Article III)
payable to Bank;
(b)Second, to payment of that portion of the Secured Obligations constituting
unpaid principal of the Loans and Secured Obligations then owing under Secured
Letter of Credit Agreements and Secured Cash Management Agreements to Bank;
(c)Third, to the payment of all other Secured Obligations of the Borrower and
its Subsidiaries owing under or in respect of the Loan Documents that are due
and payable to Bank on such date; and
WEST\258948078.15    33
(d)    Last, the balance, if any, after all of the Secured Obligations have been
indefeasibly paid in full, to the Borrower or as otherwise required by Law.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 NO WAIVER. No delay, failure or discontinuance of Bank in exercising
any right, power or remedy under any of the Loan Documents shall affect or
operate as a waiver of such right, power or remedy; nor shall any single or
partial exercise of any such right, power or remedy preclude, waive or otherwise
affect any other or further exercise thereof or the exercise of any other right,
power or remedy. Any waiver, permit, consent or approval

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of any kind by Bank of any breach of or default under any of the Loan Documents
must be in writing and shall be effective only to the extent set forth in such
writing.
SECTION 9.2 NOTICES. All notices, requests and demands which any party is
required or may desire to give to any other party under any provision of this
Agreement must be in writing delivered to each party at the following address:
BORROWER:
NATUS MEDICAL INCORPORATED

6701 Koll Center Pkwy Ste 120
Pleasanton, CA 94566-8061
Attention: Jonathan A. Kennedy
BANK:    CITIBANK, N.A.
One Sansome Street, 21st Floor
San Francisco, CA 94104
Attention: Wayne W. Xia
or to such other address as any party may designate by written notice to all
other parties. Each such notice, request and demand shall be deemed given or
made as follows: (a) if sent by hand delivery, upon delivery; (b) if sent by
mail, upon the earlier of the date of receipt or three (3) days after deposit in
the U.S. mail, first class and postage prepaid; and (c) if sent by telecopy,
upon receipt.
SECTION 9.3 EXPENSES; INDEMNITY; DAMAGE WAIVER.
(a)Borrower shall pay to Bank immediately upon demand the full amount of all
payments, advances, charges, costs and expenses, including reasonable attorneys’
fees (to include outside counsel fees and all allocated costs of Bank’s in-house
counsel), expended or incurred by Bank in connection with (i) the negotiation
and preparation of this Agreement and the other Loan Documents, Bank’s continued
administration hereof and thereof, and the preparation of any amendments and
waivers hereto and thereto, (ii) the enforcement of Bank’s rights and/or the
collection of any amounts which become due to Bank under any of the Loan
Documents, and (iii) the prosecution or defense of any action in any way related
to any of the Loan Documents, including without limitation, any action for
declaratory relief, whether incurred at the trial or appellate level, in an
arbitration proceeding or otherwise, and including any of the foregoing incurred
in connection with any bankruptcy proceeding (including without limitation, any
adversary proceeding, contested matter or motion brought by Bank or any other
person) relating to any Borrower or any other person or entity.
(b)Borrower shall indemnify Bank and Bank’s affiliates and the partners,
members, directors, officers, employees, agents and advisors of Bank and Bank’s
affiliates (each such
WEST\258948078.15    34
Person being called an “Indemnitee”) against, and hold each Indemnitee harmless
from, any and all losses, claims, damages, liabilities and related expenses
(including the fees, charges and disbursements of any counsel for any
Indemnitee), and shall indemnify and hold harmless each Indemnitee from all fees
and time charges and disbursements for attorneys, who may be employees of any
Indemnitee, incurred by any Indemnitee or asserted against any Indemnitee by any
third party or by Borrower or any Guarantor, or any Subsidiary of Borrower or
any Guarantor, arising out of, in connection with, or as a result of: (i) the
execution or delivery of this Agreement, any other Loan Document or any document
contemplated hereby or thereby, the performance by the parties hereto of their
respective obligations hereunder or thereunder or the consummation of the
transactions contemplated hereby or thereby; (ii) any Loan or the use or
proposed use of the proceeds therefrom; (iii) any actual or alleged presence or
release of Hazardous Materials on or from any property owned or operated by
Borrower, any Guarantor or any Subsidiary of Borrower or any Guarantor, or any
Environmental Claim or Environmental Liability related in any way to Borrower,
any Guarantor or any Subsidiary of Borrower or any Guarantor; or (iv) any actual
or prospective claim, litigation, investigation or proceeding relating to any of
the foregoing, whether based on contract, tort or any other theory, whether
brought by a third party or by Borrower,

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any Guarantor or any Subsidiary of Borrower or any Guarantor, and regardless of
whether any Indemnitee is a party thereto, in all cases, whether or not caused
by or arising, in whole or in part, out of the comparative, contributory or sole
negligence of the Indemnitee; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
liabilities or related expenses result from the gross negligence or willful
misconduct of such Indemnitee.
(a)To the fullest extent permitted by applicable Law, Borrower shall not assert,
and hereby waives, any claim against any Indemnitee, on any theory of liability,
for special, indirect, consequential or punitive damages (as opposed to direct
or actual damages) arising out of, in connection with, or as a result of, this
Agreement, any other Loan Document or any document contemplated hereby, the
transactions contemplated hereby or thereby, any Loan or the use of the proceeds
thereof. No Indemnitee referred to in Section 9.3(b) shall be liable for any
damages arising from the use by unintended recipients of any information or
other materials distributed by it through telecommunications, electronic or
other information transmission systems in connection with this Agreement or the
other Loan Documents or the transactions contemplated hereby or thereby.
(b)The agreements in this Section 9.3 shall survive the termination of this
Agreement and the repayment, satisfaction or discharge of all other Obligations.
SECTION 9.4 SUCCESSORS, ASSIGNMENT. This Agreement shall be binding upon and
inure to the benefit of the heirs, executors, administrators, legal
representatives, successors and assigns of the parties; provided that Borrower
may not assign or transfer its interest hereunder without Bank’s prior written
consent. Bank reserves the right to sell, assign, transfer, negotiate or grant
participations in all or any part of, or any interest in, Bank’s rights and
benefits under each of the Loan Documents.
SECTION 9.5 CONFIDENTIALITY. The Confidential Information will be used by Bank
solely for the purpose of evaluating Borrower’s credit request and/or Bank’s
ongoing credit accommodations to Borrower. Bank will keep all the Confidential
Information confidential, and will not disclose any of the Confidential
Information to any person or entity, except disclosures: (a) to federal and
state bank examiners, and other regulatory officials having jurisdictions over
Bank; (b) to Bank’s legal counsel and auditors; (c) to other professional
advisors to Bank; (d) to Bank’s representatives (which shall include, without
limitation, all other banks and companies affiliated with Citibank, N.A.) who
need to know the Confidential Information for the purpose of evaluating
Borrower’s credit request and/or Bank’s ongoing
WEST\258948078.15    35
credit accommodations to Borrower, it being expressly understood and agreed that
such representatives shall be informed of the confidential nature of the
Confidential Information, and shall be required by Bank to treat the
Confidential Information as confidential in accordance with the terms and
conditions hereof; (e) as otherwise required by Law or legal process; or (f) as
otherwise authorized by Borrower in writing. In the event that Bank or any of
its representatives becomes legally compelled to disclose any of the
Confidential Information pursuant to clause (e) of the preceding sentence, then
Bank, except as otherwise required by Law, will provide notice thereof to
Borrower so that Borrower, at its sole option (but without obligation to do so),
may attempt to seek a protective order or other appropriate remedy and/or waive
compliance with the provisions of this Agreement. The confidentiality
requirement set forth herein shall not extend to any portion of the Confidential
Information that: (x) is or becomes generally available to the public other than
as a result of a disclosure by Bank or its representatives; (y) is or becomes
available to Bank on a non-confidential basis by Borrower or any officer,
employee, agent or representative of Borrower prior to its disclosure by Bank;
or (z) is or becomes available to Bank on a non-confidential basis from a source
other than Borrower.
SECTION 9.6 GUARANTY.
(a) (i) Each Material Domestic Subsidiary of Borrower party hereto, and each
Material Domestic Subsidiary that becomes a guarantor of the Secured Obligations
pursuant to a Joinder Agreement (each, a “Subsidiary Guarantor”) unconditionally
and irrevocably guarantees to Bank the full and prompt payment when due (whether
at stated maturity, by required prepayment, declaration, acceleration, demand or
otherwise)

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and performance of all indebtedness, liabilities, covenants, duties and other
obligations of Borrower to Bank under this Agreement, the Note and all other
Loan Documents (the “Guaranteed Obligations”). The Guaranteed Obligations
include interest that, but for a proceeding under any Bankruptcy Law, would have
accrued on such Guaranteed Obligations, whether or not a claim is allowed
against Borrower for such interest in any such proceeding.
(i)Notwithstanding any term or provision of this Agreement or any other Loan
Document to the contrary, the maximum aggregate amount for which any Subsidiary
Guarantor shall be liable under the Loan Documents shall not exceed the maximum
amount for which such Subsidiary Guarantor can be liable without rendering this
Agreement or any other Loan Document, as it relates to such Subsidiary
Guarantor, subject to avoidance under applicable requirements of Law relating to
fraudulent conveyance or fraudulent transfer, including the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act and Section 548 of title 11
of the United States Code or any applicable provisions of comparable
Requirements of Law (collectively, “Fraudulent Transfer Laws”). Any analysis of
the provisions of this Agreement or any other Loan Document for purposes of
Fraudulent Transfer Laws shall take into account the right of contribution
established in Section 9.6(a)(iii) and, for purposes of such analysis, give
effect to any discharge of intercompany debt as a result of any payment made by
any Subsidiary Guarantor under any Loan Document.
(ii)To the extent that any Subsidiary Guarantor shall be required under any Loan
Document to pay any portion of any indebtedness under any Loan Document
exceeding the greater of (x) the amount of the economic benefit actually
received by such Subsidiary Guarantor from the loans and other obligations under
the Loan Documents and (y) the amount such Subsidiary Guarantor would otherwise
have paid if such Subsidiary Guarantor had paid the aggregate amount of the
indebtedness and other liabilities under the Loan Documents (excluding the
amount thereof repaid by Borrower) in the same proportion as such Subsidiary
Guarantor’s net worth on the date enforcement
WEST\258948078.15    36
is sought hereunder bears to the aggregate net worth of all the Subsidiary
Guarantors on such date, then such Subsidiary Guarantor shall be reimbursed by
such other Subsidiary Guarantors for the amount of such excess, pro rata, based
on the respective net worth of such other Subsidiary Guarantors on such date.
(a)Each Subsidiary Guarantor acknowledges and agrees that: (i) the Guaranteed
Obligations are separate and distinct from any debt arising under or in
connection with any other document, including under any provision of this
Agreement other than this Section 9.6, executed at any time by such Subsidiary
Guarantor in favor of Bank; and (ii) such Subsidiary Guarantor shall pay and
perform all of the Guaranteed Obligations as required under this Section 9.6,
and Bank may enforce any and all of its respective rights and remedies
hereunder, without regard to any other document, including any provision of this
Agreement other than this Section 9.6, at any time executed by such Subsidiary
Guarantor in favor of Bank, irrespective of whether any such other document, or
any provision thereof or hereof, shall for any reason become unenforceable or
any of the debt thereunder shall have been discharged, whether by performance,
avoidance or otherwise (other than the indefeasible payment and performance in
full of all Guaranteed Obligations). Each Subsidiary Guarantor acknowledges
that, in providing benefits to Borrower, Bank is relying upon the enforceability
of this Section 9.6 and the Guaranteed Obligations as separate and distinct debt
of such Subsidiary Guarantor, and each Subsidiary Guarantor agrees that Bank
would be denied the full benefit of its bargain if at any time this Section 9.6
or the Guaranteed Obligations were treated any differently. The fact that the
guaranty is set forth in this Agreement rather than in a separate guaranty
document is for the convenience of Borrower and Subsidiary Guarantors and shall
in no way impair or adversely affect the rights or benefits of Bank under this
Section 9.6. Each Subsidiary Guarantor agrees to execute and deliver a separate
document, immediately upon request at any time of Bank, evidencing such
Subsidiary Guarantor’s obligations under this Section 9.6. Upon the occurrence
of any Event of Default, a separate action or actions may be brought against any
Subsidiary Guarantor, whether or not Borrower, any other Subsidiary Guarantor or
any other Person is joined therein or a separate action or actions are brought
against Borrower, any such other Subsidiary Guarantor or any such other Person.
(b)To the extent that any court of competent jurisdiction shall impose by final
judgment under applicable Law (including the California Uniform Fraudulent
Transfer Act and Sections 544 and 548 of the Bankruptcy Code) any limitations on
the amount of any Subsidiary Guarantor’s liability with respect to the
Guaranteed Obligations that

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Bank can enforce under this Section 9.6, Bank by its acceptance hereof accepts
such limitation on the amount of such Subsidiary Guarantor’s liability hereunder
to the extent needed to make this Section 9.6 fully enforceable and
nonavoidable.
(c)The liability of any Subsidiary Guarantor under this Section 9.6 shall be
irrevocable, absolute, independent and unconditional, and shall not be affected
by any circumstance that might constitute a discharge of a surety or guarantor
other than the indefeasible payment and performance in full of all Guaranteed
Obligations. In furtherance of the foregoing and without limiting the generality
thereof, each Subsidiary Guarantor agrees as follows:
(i)    such Subsidiary Guarantor’s liability hereunder shall be the immediate,
direct, and primary obligation of such Subsidiary Guarantor and shall not be
contingent upon Bank’s exercise or enforcement of any remedy it may have against
Borrower or any other Person, or against any collateral or other security for
any Guaranteed Obligations;
WEST\258948078.15    37
(i)this guaranty is a guaranty of payment when due and not merely of
collectibility;
(ii)Bank may enforce this Section 9.6 upon the occurrence of an Event of Default
notwithstanding the existence of any dispute among Bank, on the one hand, and
Borrower or any other Person, on the other hand, with respect to the existence
of such Event of Default;
(iii)such Subsidiary Guarantor’s payment of a portion, but not all, of the
Guaranteed Obligations shall in no way limit, affect, modify or abridge such
Subsidiary Guarantor’s liability for any portion of the Guaranteed Obligations
remaining unsatisfied; and
(iv)such Subsidiary Guarantor’s liability with respect to the Guaranteed
Obligations shall remain in full force and effect without regard to, and shall
not be impaired or affected by, nor shall such Subsidiary Guarantor be
exonerated or discharged by, any of the following events:
(A)any proceeding under any Bankruptcy Law;
(B)any limitation, discharge, or cessation of the liability of Borrower or any
other Person for any Guaranteed Obligations due to any statute, regulation or
rule of Law, or any invalidity or unenforceability in whole or in part of any of
the Guaranteed Obligations or the Loan Documents;
(C)any merger, acquisition, consolidation or change in structure of Borrower or
any other guarantor or Person, or any sale, lease, transfer or other disposition
of any or all of the assets or shares of Borrower or any other Person;
(D)any assignment or other transfer, in whole or in part, of Bank’s interests in
and rights under this Agreement (including this Section 9.6) or the other Loan
Documents;
(E)any claim, defense, counterclaim or setoff, other than that of prior
performance, that Borrower, such Subsidiary Guarantor, any other guarantor or
any other Person may have or assert, including any defense of incapacity or lack
of corporate or other authority to execute any of the Loan Documents;
(F)Bank’s amendment, modification, renewal, extension, cancellation or surrender
of any Loan Document or any Guaranteed Obligations;
(G)Bank’s exercise or non-exercise of any power, right or remedy with respect to
any Guaranteed Obligations or any collateral therefor;
(H)Bank’s vote, claim, distribution, election, acceptance, action or inaction in
any proceeding under any Bankruptcy Law; or
(I)any other guaranty, whether by such Subsidiary Guarantor or any other Person,
of all or any part of the Guaranteed Obligations or any other indebtedness,
obligations or liabilities of Borrower to Bank.
WEST\258948078.15    38
(e) Each Subsidiary Guarantor hereby unconditionally consents and agrees that,
without notice to or further assent from such Subsidiary Guarantor:
(i)the principal amount of the Guaranteed Obligations may be increased or
decreased and additional indebtedness or obligations of Borrower under the Loan
Documents may be incurred and the time,

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manner, place or terms of any payment under any Loan Document may be extended or
changed, by one or more amendments, modifications, renewals or extensions of any
Loan Document or otherwise;
(ii)the time for Borrower’s (or any other Person’s) performance of or compliance
with any term, covenant or agreement on its part to be performed or observed
under any Loan Document may be extended, or such performance or compliance
waived, or failure in or departure from such performance or compliance consented
to, all in such manner and upon such terms as Bank (as applicable under the
relevant Loan Documents) may deem proper;
(iii)Bank may request and accept other guaranties and may take and hold security
as collateral for the Guaranteed Obligations, and may, from time to time, in
whole or in part, exchange, sell, surrender, release, subordinate, modify,
waive, rescind, compromise or extend such other guaranties or security and may
permit or consent to any such action or the result of any such action, and may
apply such security and direct the order or manner of sale thereof; and
(iv)Bank may exercise, or waive or otherwise refrain from exercising, any other
right, remedy, power or privilege even if the exercise thereof affects or
eliminates any right of subrogation or any other right of such Subsidiary
Guarantor against Borrower.
(f) Each Subsidiary Guarantor waives and agrees not to assert:
(i)any right to require Bank to proceed against Borrower, any other guarantor or
any other Person, or to pursue any other right, remedy, power or privilege of
Bank whatsoever;
(ii)the defense by Borrower of the statute of limitations in any action
hereunder or for the collection or performance of the Guaranteed Obligations;
(iii)any defense arising by reason of any lack of corporate or other authority
or any other defense of Borrower, such Subsidiary Guarantor or any other Person;
(iv)any defense based upon Bank’s errors or omissions in the administration of
the Guaranteed Obligations;
(v)any rights to set-offs and counterclaims;
(vi)without limiting the generality of the foregoing, to the fullest extent
permitted by Law, any defenses or benefits that may be derived from or afforded
by applicable Law limiting the liability of or exonerating guarantors or
sureties, or that may conflict with the terms of this Section 9.6, including any
and all benefits that otherwise might be available to such Subsidiary Guarantor
under any of California Civil Code
WEST\258948078.15    39
Sections 1432, 2809, 2810, 2815, 2819, 2839, 2845, 2848, 2849, 2850, 2899 and
3433; and
(vii) any and all notice of the acceptance of this guaranty, and any and all
notice of the creation, renewal, modification, extension or accrual of the
Guaranteed Obligations, or the reliance by Bank upon this guaranty, or the
exercise of any right, power or privilege hereunder. The Guaranteed Obligations
shall conclusively be deemed to have been created, contracted, incurred and
permitted to exist in reliance upon this guaranty. Each Subsidiary Guarantor
waives promptness, diligence, presentment, protest, demand for payment, notice
of default, dishonor or nonpayment and all other notices to or upon Borrower,
each Subsidiary Guarantor or any other Person with respect to the Guaranteed
Obligations.
(a)No Subsidiary Guarantor shall have any right to require Bank to obtain or
disclose any information with respect to: the financial condition or character
of Borrower or the ability of Borrower to pay and perform the Guaranteed
Obligations; the Guaranteed Obligations; any collateral or other security for
any or all of the Guaranteed Obligations; the existence or nonexistence of any
other guarantees of all or any part of the Guaranteed Obligations; any action or
inaction on the part of Bank or any other Person; or any other matter, fact or
occurrence whatsoever. Each Subsidiary Guarantor hereby acknowledges that it has
undertaken its own independent investigation of the financial condition of
Borrower and all other matters pertaining to this guaranty and further
acknowledges that it is not relying in any manner upon any representation or
statement of Bank with respect thereto.
(b)Until the Guaranteed Obligations shall be satisfied in full and until the
termination of this Agreement (other than with respect to contingent
indemnification obligations under Section 9.3) when all monetary Obligations
(including, without commitment, the repayment of Loans) have been satisfied in
full, each Subsidiary Guarantor shall not have, and shall not directly or
indirectly exercise: (i) any rights that it may acquire by way of subrogation
under

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this Section 9.6, by any payment hereunder or otherwise; (ii) any rights of
contribution, indemnification, reimbursement or similar suretyship claims
arising out of this Section 9.6; or (iii) any other right that it might
otherwise have or acquire (in any way whatsoever) that could entitle it at any
time to share or participate in any right, remedy or security of Bank as against
any Borrower or other guarantors or any other Person, whether in connection with
this Section 9.6, any of the other Loan Documents or otherwise. If any amount
shall be paid to any Subsidiary Guarantor on account of the foregoing rights at
any time when all the Guaranteed Obligations shall not have been paid in full,
such amount shall be held in trust for the benefit of Bank and shall forthwith
be paid to Bank to be credited and applied to the Guaranteed Obligations,
whether matured or unmatured, in accordance with the terms of the Loan
Documents.
(c)All payments on account of all indebtedness, liabilities and other
obligations of Borrower to any Subsidiary Guarantor or to any other Subordinated
Guarantor, whether now existing or hereafter arising, and whether due or to
become due, absolute or contingent, liquidated or unliquidated, determined or
undetermined (the “Subsidiary Guarantor Subordinated Debt”) shall be subject,
subordinate and junior in right of payment and exercise of remedies, to the
extent and in the manner set forth herein, to the prior payment in full in cash
or cash equivalents of the Guaranteed Obligations. As long as any of the
Guaranteed Obligations (other than unasserted contingent indemnification
obligations) shall remain outstanding and unpaid, each Subsidiary Guarantor
shall not accept or receive any payment or distribution by or on behalf of
Borrower or any other Subsidiary Guarantor, directly or indirectly, or assets of
Borrower or any other Subsidiary Guarantor, of any kind or character, whether in
cash, property or securities, including
WEST\258948078.15    40
on account of the purchase, redemption or other acquisition of Subsidiary
Guarantor Subordinated Debt, as a result of any collection, sale or other
disposition of collateral, or by setoff, exchange or in any other manner, for or
on account of the Subsidiary Guarantor Subordinated Debt (“Subsidiary Guarantor
Subordinated Debt Payments”). Notwithstanding anything to the contrary contained
herein, unless an Event of Default has occurred and is continuing, any
Subsidiary Guarantor may accept payments by or on behalf of Borrower or any
other Subsidiary Guarantor made in the ordinary course of business and
consistent with past practices of Borrower and the Subsidiary Guarantors.
If any Subsidiary Guarantor Subordinated Debt Payments shall be received in
contravention of this Section 9.6, such Subsidiary Guarantor Subordinated Debt
Payments shall be held in trust for the benefit of Bank and shall be paid over
or delivered to Bank for application to the payment in full in cash or cash
equivalents of all Guaranteed Obligations remaining unpaid to the extent
necessary to give effect to this Section 9.6 after giving effect to any
concurrent payments or distributions to Bank in respect of the Guaranteed
Obligations.
(a)This guaranty is a continuing guaranty and agreement of subordination and
shall continue in effect and be binding upon each Subsidiary Guarantor until
this Agreement shall be terminated and payment and performance in full of the
Guaranteed Obligations, including Guaranteed Obligations which may exist
continuously or which may arise from time to time under successive transactions,
and each Subsidiary Guarantor expressly acknowledges that this guaranty shall
remain in full force and effect notwithstanding that there may be periods in
which no Guaranteed Obligations exist. This guaranty shall continue in effect
and be binding upon each Subsidiary Guarantor until actual receipt by Bank of
written notice from such Subsidiary Guarantor of its intention to discontinue
this guaranty as to future transactions (which notice shall not be effective
until noon on the day that is five Business Days following such receipt);
provided that no revocation or termination of this guaranty shall affect in any
way any rights of Bank hereunder with respect to any Guaranteed Obligations
arising or outstanding on the date of receipt of such notice, including any
subsequent continuation, extension, or renewal thereof, or change in the terms
or conditions thereof, or any Guaranteed Obligations made or created after such
date to the extent made or created pursuant to a legally binding commitment of
Bank in existence as of the date of such revocation (collectively, “Existing
Guaranteed Obligations”), and the sole effect of such notice shall be to exclude
from this guaranty Guaranteed Obligations thereafter arising which are
unconnected to any Existing Guaranteed Obligations.
(b)This guaranty shall continue to be effective or shall be reinstated and
revived, as the case may be, if, for any reason, any payment of the Guaranteed
Obligations by or on behalf of Borrower (or receipt of any proceeds of
collateral) shall be rescinded, invalidated, declared to be fraudulent or
preferential, set aside, voided or otherwise required to be repaid to Borrower,
its estate, trustee, receiver or any other Person (including under any
Bankruptcy Law), or must otherwise be restored by Bank, whether as a result of
proceedings under any Bankruptcy Law or otherwise. All losses, damages, costs
and expenses that Bank may suffer or incur as a result of any voided or
otherwise set aside payments shall be specifically covered by the indemnity in
favor of Bank contained in Section 9.3.

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(c)The extensions of credit provided to or for the benefit of Borrower hereunder
by Bank have been and are to be contemporaneously used for the benefit of
Borrower and each Subsidiary Guarantor. It is the position, intent and
expectation of the parties that Borrower and each Subsidiary Guarantor have
derived and will derive significant and substantial benefits from the extensions
of credit to be made available by Bank under the Loan Documents. Each Subsidiary
Guarantor has received at least “reasonably equivalent value” (as such phrase is
used in Section
WEST\258948078.15    41
548 of the Bankruptcy Code, in Section 3439.04 of the California Uniform
Fraudulent Transfer Act and in comparable provisions of other applicable Law)
and more than sufficient consideration to support its obligations hereunder in
respect of the Guaranteed Obligations. Immediately prior to and after and giving
effect to the incurrence of each Subsidiary Guarantor’s obligations under this
guaranty, such Subsidiary Guarantor will be solvent.
(m) Each Subsidiary Guarantor acknowledges that it either has obtained the
advice of legal counsel or has had the opportunity to obtain such advice in
connection with the terms and provisions of this Section 9.6. Each Subsidiary
Guarantor acknowledges and agrees that each of the waivers and consents set
forth herein is made with full knowledge of its significance and consequences,
that all such waivers and consents herein are explicit and knowing and that each
Subsidiary Guarantor expects such waivers and consents to be fully enforceable.
If, while any Subsidiary Guarantor Subordinated Debt is outstanding, any
proceeding under any Bankruptcy Law is commenced by or against Borrower or its
property, Bank, is hereby irrevocably authorized and empowered (in its own the
name or in the name of any Subsidiary Guarantor or otherwise), but shall have no
obligation, to demand, sue for, collect and receive every payment or
distribution in respect of all Subsidiary Guarantor Subordinated Debt and give
acquittances therefor and to file claims and proofs of claim and take such other
action (including voting the Subsidiary Guarantor Subordinated Debt) as it may
deem necessary or advisable for the exercise or enforcement of any its the
rights or interests; and each Subsidiary Guarantor shall promptly take such
action as Bank may reasonably request: (A) to collect the Subsidiary Guarantor
Subordinated Debt for the account of Bank and to file appropriate claims or
proofs of claim in respect of the Subsidiary Guarantor Subordinated Debt; (B) to
execute and deliver to Bank such powers of attorney, assignments and other
instruments as it may request to enable it to enforce any and all claims with
respect to the Subsidiary Guarantor Subordinated Debt; and (C) to collect and
receive any and all Subsidiary Guarantor Subordinated Debt Payments.
SECTION 9.7 ENTIRE AGREEMENT; AMENDMENT. This Agreement and the other Loan
Documents constitute the entire agreement between Borrower and Bank with respect
to each credit created by the Loan Documents and supersede all prior
negotiations, communications, discussions and correspondence concerning the
subject matter hereof. This Agreement may be amended or modified only in writing
signed by each party hereto.
SECTION 9.8 NO THIRD PARTY BENEFICIARIES. This Agreement is made and entered
into for the sole protection and benefit of the parties hereto and their
respective permitted successors and assigns, and no other person or entity shall
be a third party beneficiary of, or have any direct or indirect cause of action
or claim in connection with, this Agreement or any other of the Loan Documents
to which it is not a party.
SECTION 9.9 TIME. Time is of the essence of each and every provision of this
Agreement and each other of the Loan Documents.
SECTION 9.10 SEVERABILITY OF PROVISIONS. If any provision of this Agreement
shall be prohibited by or invalid under applicable Law, such provision shall be
ineffective only to the extent of such prohibition or invalidity without
invalidating the remainder of such provision or any remaining provisions of this
Agreement.
SECTION 9.11 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when executed and delivered shall be deemed to be an
original, and all of which when taken together shall constitute one and the same
Agreement.

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WEST\258948078.15    42
SECTION 9.12 GOVERNING LAW; SUBMISSION TO JURISDICTION.
(a)Governing Law. This Agreement and the other Loan Documents and any claims,
controversy, dispute or cause of action (whether in contract or tort or
otherwise) based upon, arising out of or relating to this Agreement or any other
Loan Document (except, as to any other Loan Document, as expressly set forth
therein) and the transactions contemplated hereby and thereby shall be governed
by, and construed in accordance with, the law of the State of New York.
(b)Submission to Jurisdiction. THE BORROWER AND EACH OF ITS SUBSIDIARIES
IRREVOCABLY AND UNCONDITIONALLY agrees that it will not commence any action,
litigation or proceeding of any kind or description, whether in law or equity,
whether in contract or in tort or otherwise, against the Bank in any way
relating to this Agreement or any other Loan Document or the transactions
relating hereto or thereto, in any forum other than THE COURTS OF THE STATE OF
NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF
THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, AND
EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE
JURISDICTION OF SUCH COURTS AND AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH
ACTION, LITIGATION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK
STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH
FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY
SUCH ACTION, LITIGATION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN
OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY
LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY
RIGHT THAT THE BANK MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE BORROWER, ITS
SUBSIDIARIES OR ANY OR THEIR PROPERTIES IN THE COURTS OF ANY JURISDICTION.
(c)Waiver of Venue. THE BORROWER AND EACH OF ITS SUBSIDIARIES IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY
OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION. EACH OF THE
PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH
ACTION OR PROCEEDING IN ANY SUCH COURT.
(d)Service of Process. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF
PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 9.2. NOTHING IN THIS
AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY APPLICABLE LAW.
SECTION 9.13. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER
WEST\258948078.15    43
LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED
ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN

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DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.
SECTION 9.14 TERMINATION OF AGREEMENT. This Agreement shall terminate (other
than with respect to contingent indemnification obligations under Section 9.3)
when all monetary Obligations (including, without limitation, the repayment of
all Loans) have been satisfied in full.
SECTION 9.15 NO OBLIGATION TO LEND. NOTWITHSTANDING ANYTHING EXPRESSED OR
IMPLIED HEREIN OR ELSEWHERE TO THE CONTRARY, AT NO TIME SHALL BANK BE UNDER ANY
OBLIGATION TO MAKE ANY REVOLVING CREDIT LOANS TO BORROWER PURSUANT TO THIS
AGREEMENT.
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