exv10w12





Exhibit 10.12



COMMERCIAL LOAN AGREEMENT




	 	 	 	 	 	 	 
	 
	 	 


	LENDER
	 	BORROWER


	  COMPASS BANK 

  5800 North Mopac 

  Austin, Texas 78731	 	 	 	RULES-BASED MEDICINE, INC.
	 	 	 	 	
ADDRESS


	 

	 	 	 	3300 Duval Road

Austin, Texas 78759	 	 
	 

	 	 	 	
TELEPHONE NO.


	 	
IDENTIFICATION NO.

	
GRANTOR

	 	
OWNER OF COLLATERAL


	 	 	 	 	RULES-BASED MEDICINE, INC.

 
	
ADDRESS
	 	
ADDRESS


	 

	 	 	 	3300 Duval Road

Austin, Texas 78759	 	 
	  
  TELEPHONE NO.


	 	
IDENTIFICATION NO.
	 	
TELEPHONE NO.
	 	
IDENTIFICATION NO.






AGREEMENTS



1. Financing. Subject to the following conditions, Lender shall provide Borrower with the
advances, loans and/or other financial accommodations identified in Schedule A, as may be amended
from time to time, which is incorporated into this Agreement by this reference, as well as any
other loans and/or financial accommodations that Borrower and Lender may agree to in writing (the
“Loan”).







The Loan shall be evidenced and/or secured by collateral set forth in loan documents that are
acceptable to Lender in its sole discretion including, but not limited to, the documents identified
in Schedule B, as amended by mutual agreement of Lender and Borrower from time to time
(collectively “Loan Documents”), which is incorporated into this Agreement by this
reference.











Certain of the Loan Documents provide for a $9,000,000.00 revolving line of credit (the
“Line”) under which Borrower may from time to time borrow, repay and re-borrow funds.
The Line is subject to the terms of the Borrowing Base Agreement attached hereto as Exhibit “C” and
by reference made a part hereof, and notwithstanding anything contained herein to the contrary, the
aggregate principal amount advanced and remaining unpaid pursuant to the terms of the Loan
Documents and this Agreement as they relate to the Line shall not exceed the Maximum Amount as
defined in the Borrowing Base Agreement. Borrower will pay hereafter on the 1st day of
each calendar quarter for the period from and including the date of the Note establishing the Line
to and including the maturity date of the Line, a usage fee at a rate per annum of 0.25% of the
average daily unused portion of the Line during such period. The Borrower may at any time







 









 






upon written notice to Lender permanently reduce the amount of the Line at which time the
obligation of the Borrower to pay a usage fee shall thereupon correspondingly be reduced.



Borrower shall pay to Lender the principal, interest, fees, expenses and any other amounts
pertaining to the Loan as described in this Agreement and the Loan Documents.



2. Guaranties and Collateral.





	 	a.	 	Guaranties. None.
	 
	 	b.	 	Collateral.




Borrower shall grant and/or cause:



Owner of Collateral identified above, whose tax identification number is 2515967969 and who is a
corporation duly organized, validly existing, and in good standing under the laws of the State of
Delaware (Owners of Collateral identified above will be referred to as “Debtor”) to grant Lender a
lien, security interest or other encumbrance upon the collateral (collectively “Collateral”)
belonging to the Borrower and/or any Debtors, as described in the Loan Documents to secure the
payment and performance of all of the Borrower’s present and future, joint and/or several, direct
and indirect, absolute and contingent, express and implied, indebtedness, liabilities, obligations
and covenants to Lender as described in this Agreement and the Loan Documents (the “Obligations”).
Borrower may add additional U.S. based Debtors upon the prior written consent of Lender, which
consent shall not be unreasonably withheld, in which event such Debtor shall grant Lender a lien,
security interest or other encumbrance upon the collateral belonging to the Debtor, as described in
the Loan Documents.



3. Superior and Continuing Liens and Guaranties.





	 	a.	 	Superiority of Lender’s Lien. The liens, security interests and other
encumbrances granted to Lender shall be superior to any other liens, security
interests, encumbrances and claims with respect to the Collateral (unless specifically
permitted in this Agreement or the Loan Documents).
	 
	 	b.	 	Guaranties, Liens and Other Encumbrances. The liens, security interests, and
other encumbrances described in the Loan Documents shall continue and not be released
until all of the indebtedness, liabilities, obligations and covenants guarantied or
secured thereby shall have been paid and performed in full, as measured at the time of
the requested release by Borrower, and Lender shall not be obligated to provide any
additional advances, loans or other financial accommodations to or for the benefit of
Borrower (or, if applicable, any of the Debtors) of any kind, whereupon, Lender agrees
to promptly execute and deliver to the Borrower, at the Borrower’s cost and expense as
provided in Paragraph 11, any and all releases of liens, termination statements,
assignments, guaranties or other documents reasonably requested by the Borrower as
necessary to fully release the Collateral and the Obligations.




4. Conditions Precedent. Lender’s obligation to provide Borrower with any advances, loans and/or
other financial accommodations shall be subject to the following conditions precedent. All of the
information, UCC and lien searches, insurance policies, environmental risk


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assessments, opinion letters, and other materials and documents provided or to be provided to
Lender and all of the actions taken or to be taken for the attachment, creation, perfection,
recording, maintenance, subordination, release, termination, and giving of notice with respect to
the liens, security interests, and other encumbrances in the Collateral shall be provided or taken
at Borrower’s expense, provided, however, Borrower shall only be responsible for reasonable and
customary costs in connection with the Loan:





	 	a.	 	Evidence of Good Standing. Lender shall be provided with such written evidence
of the Borrower and any Guarantors and Debtors’ legal names and good standing,
authorization to conduct business, and authorization to execute and perform their
respective Obligations under this Agreement and the Loan Documents as required by
Lender;
	 
	 	b.	 	Execution and Delivery. Borrower shall execute and deliver this Agreement and
cause any Guarantors and Debtors to execute and deliver to Lender the Loan Documents;
	 
	 	c.	 	Authorization. Lender shall be provided with such written evidence as required
by Lender that the representatives of the Borrower and any Guarantors and Debtors are
authorized to execute this Agreement and the Loan Documents on behalf of those parties
and bind the Borrower and any Guarantors and Debtors to the terms and conditions set
forth therein;
	 
	 	d.	 	Liens. Lender’s liens, security interests, and other encumbrances upon the
Collateral shall be attached, created, filed, perfected and recorded in accordance with
applicable law and notice of such liens, security interests and encumbrances shall be
provided to such parties as required by Lender;
	 
	 	e.	 	Lien Searches. Lender shall be provided with UCC searches, title insurance
policies, or other written evidence as required by Lender with respect to the validity,
enforceability and priority of its liens, security interests and other encumbrances
upon the Collateral;
	 
	 	f.	 	Intentionally Omitted;
	 
	 	g.	 	Intentionally Omitted;
	 
	 	h.	 	Financial Information. Borrower shall provide and cause any Guarantors and
Debtors to provide Lender with such financial information and business records as
required by Lender in its reasonable discretion. Such financial information and
business records shall be acceptable to Lender in its reasonable discretion and shall
not cause Lender to believe in good faith that the Borrower or any Guarantors or
Debtors shall not be able to perform its respective Obligations under this Agreement or
the Loan Documents;
	 
	 	i.	 	Absence of Breach. All the respective representations and warranties of the
Borrower or any Guarantor or Debtor under this Agreement or the Loan Documents shall be
true and correct on and as of the date of the execution of these documents or date of
any initial advances and/or extensions of the loans and/or other financial
accommodations described therein; and
	 
	 	j.	 	Absence of Default. No Default shall have occurred and is continuing under
this Agreement or the Loan Documents nor shall any circumstances exist that would
constitute an Event of Default except for notice or the passage of time or both on or
before the execution of those documents or the advances requested by Borrower and/or
extensions of the loans and/or other financial accommodations described therein.




3









 










5. Representations, Warranties and Covenants. Borrower represents and warrants to, as of the date
of this Agreement, and covenants with Lender, on going forward basis during the term of this
Agreement and any renewals and restructures until all of the indebtedness, liabilities, obligations
and covenants guarantied or secured thereby shall have been paid and performed in full (it being
understood that references in this Paragraph 5 to matters that “shall be” will be construed as
covenants by Borrower with Lender on a going forward basis), that:

:





	 	a.	 	Tax Identification. The tax identification number of Borrower is as follows:
2515967969.
	 
	 	b.	 	Borrower’s Residency. Borrower is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and authorized to
conduct business in the State of Texas and all of the other jurisdictions in which its
business is conducted;
	 
	 	c.	 	Intentionally Omitted;
	 
	 	d.	 	Debtor’s Tax Identification and Residency. Debtors are residents of the
State(s) of or duly organized, validly existing and in good standing under the laws of
the state of their formation and authorized to conduct business in all of the
jurisdictions in which their business is conducted. Debtors’ tax identification and/or
social security numbers are those shown in any applicable Loan Documents;
	 
	 	e.	 	Ownership of Collateral. Borrower and any Debtors are and shall remain sole
owners of their respective Collateral free of all tax and other liens, security
interests, encumbrances and claims of any kind except as specifically permitted by this
Agreement and the Loan Documents and except for dispositions specifically permitted by
this Agreement and the Loan Documents;
	 
	 	f.	 	Location of Offices. The sole executive offices, places of business, offices
where their business records are located, residences and domiciles of the Borrower and
any Guarantors and Debtors are specifically described in this Agreement and the Loan
Documents. Borrower shall immediately advise and cause any Guarantors and Debtors to
immediately advise Lender in writing of any change in or addition to the foregoing
addresses;
	 
	 	g.	 	Restructuring. Neither Borrower nor any Guarantor or Debtor shall become a
party to any restructuring of its form of business or participate in any consolidation,
merger, liquidation or dissolution without obtaining Lender’s prior written consent
thereto, which will not be unreasonably withheld, delayed or conditioned;
	 
	 	h.	 	Beneficiaries. Each of the Guarantors and Debtors, if any, by virtue of their
interest in or relation to Borrower, shall receive a substantial benefit from Lender’s
advances, loans and/or other financial accommodations to Borrower and such benefit
shall constitute adequate consideration for the obligations assumed by any Guarantor
and Debtors under this Agreement and the Loan Documents;
	 
	 	i.	 	Change of Name. Borrower shall provide and cause any Guarantors and Debtors to
provide Lender with at least thirty (30) or more days’ prior written notice of the
nature of any intended change in their respective names, or the use of any tradename,
and when such change or use shall become effective;
	 
	 	j.	 	Location of Collateral. All of Borrower and any Debtors’ property constituting
a portion of the Collateral is and shall be located at Borrower and such Debtors’
respective executive offices, places of business, residences and domiciles specifically
described in this Agreement and the Loan Documents unless written




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	 	 	 	notice of another location is given to Lender within ten (10) days of any
relocation;
	 
	 	k.	 	Use of Collateral. Borrower shall use and cause by Debtors to use the
Collateral solely in the ordinary course of their respective businesses, for the usual
purposes intended by the manufacturer (if applicable), with due care, and in compliance
in all material respects with the laws, ordinances, regulations, requirements and rules
of all federal, state, county and municipal authorities and insurance policies.
Borrower shall not make and cause Debtors to not make any alterations, additions or
improvements to the Collateral without the prior written consent of Lender which is
outside the ordinary course of Borrower and Debtor’s business and materially and
adversely affects the Collateral. Without limiting the foregoing, all alterations,
additions and improvements made to the Collateral shall be subject to the security
interest belonging to Lender, shall not be removed if such removal might result in a
material adverse effect on the Borrower, any Guarantor or Debtor, or the Collateral,
without the prior written consent of Lender, and shall be made at Borrower and the
Debtors’ sole expense. Borrower shall take and cause any Debtors to take all
commercially reasonable actions and make any repairs or replacements needed to maintain
the Collateral in good condition and working order;
	 
	 	l.	 	Insurance. Borrower shall maintain and cause any Debtors to maintain insurance
with responsible insurance companies on such of its properties, in such amounts and
against such risks as described in the Agreement to Provide Insurance. All such
policies to be with such companies and providing for at least thirty (30) days prior
notice to Lender of any cancellation thereof. Satisfactory evidence of such insurance
will be supplied to Lender prior to funding under the Loan Documents and thirty (30)
days prior to each policy renewal. The insurance policies shall name Lender as a loss
payee and provide that no act or omission of Borrower, any Debtor, or any other person
shall affect the right of Lender to be paid the insurance proceeds pertaining to the
loss or damage of the Collateral;
	 
	 	m.	 	Possession of Chattel Paper. Borrower shall provide and cause by Debtors to
provide Lender with possession of all chattel paper and instruments constituting a
portion of the Collateral and mark such chattel paper and instruments to reflect
Lender’s security interest therein;
	 
	 	n.	 	Enforceability of Certain Collateral. To the best of Borrower’s knowledge, all
of Borrower and any Debtors’ accounts, contract rights, chattel paper, documents,
general intangibles, instruments, and other rights and agreements constituting a
portion of the Collateral are and shall be valid, genuine and legally enforceable
obligations and rights belonging to Borrower and such Debtors against one or more third
parties, provided that, if the same shall be subject to an assertion by a third party
of any valid claim, defense, setoff or counterclaim of any kind, they will be excluded
from Borrowing Base hereunder, to the extent of the amount in dispute and as and to the
extent provided in the Borrowing Base Agreement and such assertion, in of itself, shall
not be a Default;
	 
	 	o.	 	Substitution of Certain Collateral. Borrower shall not amend, modify, replace
or substitute and shall cause any Debtors not to amend, modify, replace or substitute
any account, contract right, chattel paper, document, general intangible, instrument,
or other right or agreement constituting the Collateral which is outside the ordinary
course of Borrower’s business and materially and adversely affects the Collateral,
without the prior written consent of Lender;




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	 	p.	 	Collection Practices. Borrower shall continue to apply and cause any Debtors
to continue to apply their established credit policies with respect to all future
credit transactions. Borrower shall use and cause any Debtors to use commercially
reasonable efforts to collect from their account debtors and other third parties, as
and when due, any and all amounts owing under or with respect to each account, contract
right, document, general intangible, instrument or other agreement (including, without
limitation, engaging legal assistance to collect delinquent obligations from their
account debtors and other third parties) and apply the collected amounts against the
outstanding balances on those obligations and agreements;
	 
	 	q.	 	Financial Statements and Other Information. Borrower shall maintain a system
of accounting satisfactory to Lender, permit Lender’s officers or authorized
representatives to visit and inspect Borrower’s books of account and other records at
such reasonable times, provided that, if no Default has occurred and be continuing,
Lender may not visit and inspect Borrower’s books of account and other records more
than four (4) times per year,, and pay the reasonable fees and disbursements of any
accountants or other agents of Lender selected by Lender for the foregoing purposes as
provided in Paragraph 11 below. Unless written notice of another location is given to
Lender, Borrower’s books and records will be located at Borrower’s address as set forth
above. All financial statements called for below shall be prepared in form and content
reasonably acceptable to Lender and in accordance with GAAP.
	 
	 	 	 	In addition, Borrower will:






	 	(i)	 	Furnish to Lender annual CPA audited financial statements
(including a balance sheet and related statements of income, retained earnings
and cash flow) of Borrower for each fiscal year of Borrower, within 120 days
after Borrower’s fiscal year end.
	 
	 	(ii)	 	Furnish to Lender quarterly internally prepared financial
statements (including a balance sheet and related statements of income,
retained earnings and cash flow) of Borrower within forty-five (45) days after
each period end.
	



	 
	 	(iii)	 	Furnish to Lender a compliance certificate for (and executed
by an authorized representative of) Borrower concurrently with and dated as of
the date of delivery of each of the financial statements as required in
Paragraphs (i) and (ii) above, in substantially the same form as set forth in
Exhibit B attached hereto and made a part hereof, containing (a)
a certification that the financial statements of even date are true and correct
and that the Borrower is not in default under the terms of this Agreement, and
(b) computations and conclusions, in such detail as Lender may request, with
respect to compliance with this Agreement, and the Loan Documents, including
computations of all quantitative covenants.
	



	 
	 	(iv)	 	Furnish to Lender promptly such additional information, reports
and statements respecting the business operations and financial condition of
Borrower, from time to time, as Lender may reasonably request;






	 	r.	 	Financial Statements. The financial statements of Borrower heretofore
delivered to Lender fairly present Borrower’s financial condition as of the date or
dates thereof, and there has been no material adverse change in Borrower’s financial
condition or operations since those dates. All factual information furnished by




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	 	 	 	Borrower to Lender in connection with this Agreement and the other Loan Documents is
and will be accurate and complete on the date as of which such information is
delivered to Lender and is not and will not be incomplete by the omission of any
material fact necessary to make such information not misleading.
	 
	 	s.	 	Obligations. By its execution of this Agreement and each Loan Document,
Borrower shall acknowledge that such agreements constitute its legal and binding
obligations that are fully enforceable in accordance with their respective terms and
conditions;
	 
	 	t.	 	Conflict of Laws. Borrower and any Guarantors and Debtors’ execution of this
Agreement and the Loan Documents and performance of their respective Obligations
thereunder does not and shall not conflict with the provisions of any statute,
regulation, ordinance, rule of law, contract or other agreement which may now or
hereafter be binding on those entities;
	 
	 	u.	 	Repayment. Borrower and any Guarantors and Debtors shall duly and punctually
repay the advances, loans and other financial accommodations evidenced by this
Agreement and the Loan Documents and perform all of their other respective Obligations
thereunder;
	 
	 	v.	 	Default in Other Obligations. Neither Borrower nor any Guarantor or Debtor are
or shall be in default under any material loan agreement, indenture, mortgage, security
agreement (or other agreement or obligation) to which they are a party or by which any
of their respective properties may be bound, except to the extent such default would
not reasonably be expected to result in a material and adverse change in Borrower’s
business operations or financial condition taken as a whole or materially affect the
Collateral;
	 
	 	w.	 	Litigation and Claims. No action or proceeding is or shall be pending or
threatened against Borrower or any Guarantor or Debtor which could reasonably be
expected to result in a material and adverse change in Borrower’s business operations
or financial condition, taken as a whole, or materially affect the Collateral and there
are and shall be no outstanding judgments against Borrower or any Guarantor or Debtor
that are not discharged to the reasonable satisfaction of Lender within thirty (30)
days of its inception;
	 
	 	x.	 	Transfer/Sale of Collateral. Neither Borrower, nor any Debtor shall transfer,
sell, lease, assign, convey or otherwise dispose of, in excess of $200,000.00 fair
market value in any two (2) year period, (i) any of the Collateral or (ii) the
properties or assets used in connection with or incidental to the operation of its
business, without the prior written consent of Lender, except for inventory sold in the
ordinary course of its business, provided that nothing herein shall prohibit or
restrict Borrower or any Debtor from granting licenses in the ordinary course of
business with respect to intellectual property rights included in the Collateral;
	 
	 	y.	 	Guaranties. Neither Borrower nor any Guarantor shall assume, guaranty or
otherwise become liable for the obligations of any person or entity except for such
Guarantor’s guaranty of Borrower’s Obligations to Lender;
	 
	 	z.	 	Solvency. Borrower and any Guarantors and Debtors are solvent and shall
continue to be solvent after the execution of this Agreement and the Loan Documents and
the creation of Lender’s security interest in the Collateral, are able and shall be
able to pay their debts as they mature, and have and shall have sufficient capital to
conduct their businesses and other financial transactions;
	 
	 	aa.	 	Tax Returns. Borrower and each Guarantor or Debtor have filed and shall file
all tax returns required to be filed by federal, state or local law (including, but not




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	 	 	 	limited to, all income, franchise, employment, property and sales tax returns)
and has paid and shall pay all of the tax liabilities and other fees and
assessments charged against that entity or its property when due, except for
taxes that are being contested in good faith and further conditioned on such
failure not being reasonably expected to result in a material and adverse
change in Borrower’s business operations or financial condition or materially
affect the Collateral. Neither Borrower nor any Guarantor or Debtor knows of
any pending investigation of those entities by any taxing or other governmental
authority or of any pending but unassessed tax liability or other fee or
assessment owing by those entities that could reasonably be expected to result
in a material and adverse change in Borrower’s business operations or financial
condition or materially affect the Collateral;
	 
	 	ab.	 	Margin Stock. Neither Borrower nor any Guarantor or
Debtor is engaged principally, or as one of its
important activities, in the business of extending
credit for the purpose of purchasing or carrying
margin stock (within the meaning of Regulations T, U
or X of the Board of Governors of the Federal Reserve
System), and no part of the loans and/or other
financial accommodations provided by Lender under
this Agreement or any of the Loan Documents shall be
used to purchase or carry any such margin stock or to
extend credit to others for the purpose of purchasing
or carrying margin stock. Neither Borrower, any
Guarantor or Debtor, nor any person acting on their
behalf has taken or shall take any action that might
cause the transactions contemplated by this Agreement
or the Loan Documents to violate Regulations T, U or
X or to violate the Securities Exchange Act of 1934,
as amended;
	 
	 	ac.	 	Compliance with ERISA. Borrower and any Guarantors
and Debtors have complied and shall comply with all
applicable minimum funding and other requirements of
the Employee Retirement Income Security Act of 1974,
as amended (“ERISA”), and there are and shall be no
existing conditions that would give rise to liability
thereunder including, without limitation, any current
or potential withdrawal liability from a
multiemployer plan (as defined in Section 3(37) of
ERISA). No reportable event (as defined in Section
4043 of ERISA) has occurred or shall occur in
connection with any employee benefit plan of those
entities that might constitute grounds for the
termination thereof by the Pension Benefit Guaranty
Corporation or for the appointment of a trustee to
administer that plan. Borrower shall immediately
notify and cause such Guarantors and Debtors to
immediately notify Lender of any fact (including, but
not limited to, any “reportable event” as that term
is defined in Section 4043 of ERISA) arising in
connection with any employee benefit plan belonging
to those entities which might constitute grounds for
the termination thereof by the Pension Benefit
Guaranty Corporation or for the appointment of a
trustee to administer that plan and, following such
notification, Borrower shall provide or cause such
Guarantors and Debtors to provide Lender with any
additional information or documents as may be
requested by Lender with respect thereto;
	 
	 	ad.	 	Investment Company. Neither Borrower nor any
Guarantor or Debtor is or shall be an “investment
company” within the meaning of the Investment Company
Act of 1940, as amended;
	 
	 	ae.	 	Holding Companies and Affiliates. Neither Borrower
nor any Guarantor or Debtor is or shall be a “holding
company” or a “subsidiary company” of a “holding
company” or an “affiliate” of a “holding company” or
a “public utility”




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	 	 	 	within the meaning of the Public Utility Holding Company Act of 1935, as amended;
	 
	 	af.	 	Compliance with Applicable Environmental Law. Borrower, each Guarantor and Debtor,
and their respective properties are and shall be in compliance in all material
respects with all applicable environmental, health and safety laws, rules and
regulations and neither Borrower nor any Guarantor or Debtor is or shall be subject
to any liability or obligation for remedial action thereunder that is reasonably
expected to result in a material and adverse change in Borrower’s business operations
or financial condition or materially affect the Collateral. No investigation or
inquiry by any governmental authority is or shall be pending or threatened against
Borrower, any Guarantor or Debtor, or any of their respective properties with respect
to Hazardous Material as defined herein. No Hazardous Materials are or shall be
located on or under Borrower or any Guarantor or Debtor’s owned or leased properties
under Borrower or any Guarantor or Debtor’s control. Neither Borrower, nor any
Guarantor or Debtor has caused or permitted or shall cause or permit any Hazardous
Materials to be stored, transported, or disposed of on or under or released from any
of its properties. The term “Hazardous Materials” shall mean any substance,
material, or waste which is or becomes regulated by any governmental authority
including, but not limited to: (i) petroleum, (ii) asbestos, (iii) polychlorinated
biphenyls, (iv) those substances, materials or wastes designated as a “hazardous
substance” pursuant to Section 311 of the Clean Water Act or listed pursuant to
Section 307 of the Clean Air Act or any amendments or replacements to these statutes,
(v) those substances, materials or wastes defined as a “hazardous waste” pursuant to
Section 1004 of the Resource Conservation and Recovery Act of any amendments or
replacements to that statute, or (vi) those substances, materials or wastes defined
as a “hazardous substance” pursuant to Section 101 of the Comprehensive Environmental
Response, Compensation and Liability Act, or any amendments or replacements to that
statute;
	 
	 	ag.	 	Compliance with Other Laws. Neither Borrower nor any Guarantor or Debtor has
violated or shall violate any applicable federal, state, county or municipal statute,
regulation or ordinance which may materially and adversely affect its respective
business operations or financial condition, taken as a whole, or the Collateral. No
Event of Default (or circumstances which, with notice or the passage of time or both,
would constitute an Event of Default) has occurred under this Agreement or the Loan
Documents;
	 
	 	ah.	 	Notification Regarding Adverse Conditions and Events of Default. Without limiting
any of the foregoing representations, warranties and covenants, Borrower shall
immediately notify and cause any Guarantors and Debtors to immediately notify Lender
of: (i) the occurrence of any Default or circumstances which, with notice or the
passage of time or both, would constitute an Event of Default under this Agreement or
the Loan Documents, (ii) the commencement of any action, suit, or proceeding or any
other matter that might have a material adverse effect on the Borrower, any Guarantor
or Debtor, or the Collateral, (iii) any change in the corporate officers of Borrower,
(iv) any circumstances that might give rise to a claim, defense, setoff or
counterclaim against Lender or with respect to the various rights and obligations
described in this Agreement and the Loan Documents, and (v) actual or potential
contingent liabilities in excess of $250,000.00;




9









 






	 	ai.	 	Commercial Purpose. This Agreement and the Loan Documents and the Obligations
described therein are executed and incurred for commercial and not for personal,
family, or household use and all proceeds of Lender’s loan and other financial
accommodations to Borrower shall be used exclusively in the Borrower’s business and
for no other purpose;
	 
	 	aj.	 	Lender’s Influence. Lender has not exercised or attempted to exercise, directly or
indirectly, any degree of control or influence of any kind whatsoever over the
internal business operations or financial affairs of Borrower, or to the best of its
knowledge, any Guarantor or Debtor, provided, however, that the existence of any
Lender control or influence shall not be considered a Default of Borrower, and
Borrower shall immediately notify and cause any Guarantors and Debtors to immediately
notify Lender and Jerry Powell, General Counsel, BBVA Compass, Legal Department, 15
South 20th Street, Suite 1802, Birmingham, Ala. 35233 in writing of any actions that
they consider to constitute an exercise or attempt to exercise such control or
influence in the future. Borrower agrees that Lender has no intention of acting as a
business, investment or financial consultant or advisor to Borrower or any Guarantor
or Debtor and Borrower or any Guarantor or Debtor hereby waive and release Lender
from any liability associated with or resulting from any such business, investment or
financial consultation or advice received from Lender. Borrower shall notify and
cause such Guarantors and Debtors to notify Lender in writing of any attempt by
Lender to act as a consultant or advisor to those entities in the future;
	 
	 	ak.	 	Lender’s Duty. Lender does not have and shall not have any fiduciary or similar duty
to Borrower, or to the best of its knowledge any Guarantor or Debtor;
	 
	 	al.	 	Lender’s Relationship. Lender has not participated and shall not participate in any
type of joint venture or partnership with Borrower or, to the best of its knowledge,
any Guarantor or Debtor and the execution and consummation of this Agreement and the
Loan Documents and the transactions contemplated therein do not and shall not
constitute or amount to a joint venture or partnership;
	 
	 	am.	 	Lender Not an Agent. Except as expressly set forth in this Agreement or the Loan
Documents, Lender has not acted and shall not act in any respect as the agent of
Borrower or any Guarantor or Debtor for any purpose and no agency relationship has
been or shall be created by the execution of this Agreement and the Loan Documents or
the consummation of the transactions contemplated thereby;
	 
	 	an.	 	Absence of Lender Representations. Except as expressly set forth in this Agreement
or the Loan Documents, Lender has not made any representations or statements of
material fact to Borrower or, to the best of its knowledge, any Guarantor or Debtor
and such entities have not relied and shall not rely upon any representations or
statements of Lender in connection with the negotiation, execution, delivery or
effect of this Agreement or the Loan Documents or the consummation of the
transactions contemplated thereby;
	 
	 	ao.	 	Borrower’s Agreement to Take Action. Borrower shall execute and deliver and cause
any Guarantors and Debtors to execute and deliver to Lender any documents and take
any actions as may be reasonably requested by Lender to carry out the intent and
purposes of this Agreement and the Loan Documents and the transactions contemplated
thereby and to preserve and perfect Lender’s liens, security interests and other
encumbrances in the Collateral;




10









 






	 	ap.	 	Insider Loans. Borrower shall not make a loan to any of its shareholders, directors,
officers or employees or any other person outside the ordinary course of
Borrower=s business without the prior consent of Lender, which consent shall
not be unreasonably withheld, delayed or conditioned;
	 
	 	aq.	 	Financial Covenants. From the date of this Agreement until full payment and
performance of all Obligations of Borrower under the Loan Documents, Borrower shall
maintain, unless Lender consents otherwise in writing (and without limiting any
requirement of any other loan agreement), the following financial conditions, except
to the extent modified by the following definitions:




(i) a Tangible Net Worth for Borrower equal to at least $6,500,000.00 to be
tested on the date of this Agreement and thereafter quarterly beginning
September 30, 2009, with “Tangible Net Worth” for purposes of this
subparagraph, defined as the gross book value of Borrower’s assets
(excluding goodwill, patents, trademarks, trade names, organization expense,
unamortized debt discount and expense, capitalized or deferred research and
development costs, deferred marketing expenses, deferred receivables (other
than deferred receivables approved by Lender, which approval shall not be
unreasonably withheld), and other like intangibles, investments in
subsidiaries/Affiliates and monies due from Affiliates, officers, directors,
employees or shareholders of Borrower) plus Subordinated Liabilities, less
Total Liabilities, including, but not limited to, accrued and deferred
income taxes, and any reserves against assets, if applicable, with
“Subordinated Liabilities” defined as liabilities subordinated to Borrower’s
Obligations to Lender in a manner acceptable to Lender prior to issuance,
using a form acceptable to Lender and with “Total Liabilities” defined as
the sum of current liabilities plus long term liabilities as those two terms
are defined under Generally Accepted Accounting Principles;



(ii) a pro-forma Debt Service Coverage Ratio for Borrower of (a) not less
than 1.35/1 to be tested on the date of this Agreement and thereafter
quarterly on a rolling four (4) quarters basis as of September 30, 2009 and
December 31, 2009 and (b) not less than 1.50/1.0 to be tested quarterly on a
rolling four (4) quarters basis beginning March 31, 2010, where such ratio
is defined as the sum of (1) net income before tax, plus (2) depreciation,
amortization and non-cash expenses, plus (3) interest expense, less (4)
dividends/distributions paid, less (5) non-financed capital expenditures,
less (6) cash investments in Affiliates and plus (7) equity investments in
Borrower and Subordinated Liabilities to the extent either one is made after
the date of this Agreement, only to the extent of Diagnostic Initiative
Losses and investments in Affiliates divided by the sum of (8) Current
Maturities of Long Term Debt paid, plus (9) interest expense paid and plus
(10) twelve (12) months principal and interest based on the available
Borrowing Base amortized over three (3) years, with “Current Maturities of
Long Term Debt” defined as that portion of the Borrower’s long-term debt and
capital leases maturing or scheduled to be paid in the prior twelve (12)
month period; and



(iii) a Fixed Charge Coverage Ratio for Borrower of at least 1.50/1.0 to be
tested quarterly on a rolling four (4) quarters basis, beginning September
30, 2009, where “Fixed Charge Coverage Ratio” shall be


11









 






 defined as the ratio of (1) net income after tax, plus (2) interest expense,
plus (3) depreciation, amortization and non-cash expense, plus (4) capital
lease expense, less (5) distributions/dividends paid, less (6) non-financed
capital expenditures, less (7) cash investments in Affiliates and plus (8)
equity investments in Borrower and Subordinated Liabilities to the extent
either one is made after the date of this Agreement, only to the extent of
Diagnostic Initiative Losses and investments in Affiliates, divided by (b)
the sum of (9) Current Maturities of Long Term Debt paid, plus (10) interest
expense paid and plus (11) capital lease expense.





	 	 	 	Except as otherwise expressly provided herein, all accounting terms used in this
Agreement shall be interpreted in accordance with GAAP applied on a basis consistent
with those used in the preparation of the latest financial statements furnished to
the Lender hereunder.
	 
	 	ar.	 	Negative Covenants: Until full payment and performance of all Obligations of
Borrower under the Loan Documents, Borrower and Debtor will not, without the prior
written consent of Lender (and without limiting any requirement of any other Loan
Documents):




(i) Grant, suffer or permit any contractual or non-contractual lien on or
security interest in any assets, including Borrower’s patent/trademark
portfolio, except in favor of Lender or for Permitted Liens, or fail to
promptly pay when due all lawful claims, whether for labor, materials or
otherwise; or



(ii) Create, incur, assume or permit to exist any indebtedness or
liabilities resulting from borrowings, loans or advances, whether secured or
unsecured, matured or un-matured, liquidated or un-liquidated, joint or
several, except (a) the liabilities of Borrower to Lender; (b) the
liabilities of Borrower existing as of, and disclosed to Lender prior to,
the date hereof; (c) trade debts and accounts payable obligations incurred
in Borrower=s ordinary course of business due and payable no more than
thirty (30) days from the date incurred; (d) purchase money indebtedness and
capital leases not to exceed $2,000,000.00 in the aggregate annually; and/or
(e) potential future Subordinated Liabilities not to exceed $10,000,000.00;
or



(iii) Make any loan or advance to any person or entity in any amount, or
purchase or otherwise acquire, any capital stock, assets, obligations, or
other securities of, make any capital contribution to, or otherwise invest
in or acquire any interest in any entity, or participate as a partner or
joint venturer treated as an entity for legal purpose with any person or
entity in excess of the greater of (a) $2,000,000.00 or (b) $2,000,000.00
plus any additional cash equity investment or Subordinated Liabilities
actually paid into Borrower prior to any such acquisitions, capital
contributions, investments and/or participations during the period from the
date hereof until maturity of the Loan, provided further, that any such
acquisitions, capital contributions, investments and/or participations,
regardless of the amount of money involved, shall be in the same or similar
lines of business as Borrower; and




12









 









	 	au.	 	Maintenance of Operating Accounts. Borrower shall maintain all or
substantially all of its operating accounts with Lender during the
term of this Agreement;
	 
	 	at.	 	Springing Lien on Collateral. In addition to the requirements of
paragraph 2 b. above, Borrower shall grant Lender a security interest
in, and/or collaterally assign, all of the patents and trademarks
owned by Borrower as additional Collateral to secure the payment and
performance of all of the Borrower’s present and future, joint and/or
several, direct and indirect, absolute and contingent, express and
implied, indebtedness, liabilities, obligations and covenants to
Lender as described in this Agreement and the Loan Documents. Until a
Default occurs and is continuing under this Agreement and the Loan
Documents, Lender shall not perfect the security interest and/or
record the collateral assignment in Borrower’s patents and trademarks.
Once a Default has occurred and is continuing, Lender shall have the
option to take whatever steps are necessary to perfect the security
interest and/or record the collateral assignment in Borrower’s patents
and trademarks and exercise any and all rights or remedies that Lender
may have under this Agreement or the Loan Documents. Borrower agrees,
upon demand, to execute and deliver to Lender such documents, in a
form and substance reasonably satisfactory to Lender, that will grant
to Lender and perfect a security interest in, and/or collaterally
assign and record, all of the patents and trademarks owned by Borrower
for the benefit of Lender; and
	 
	 	av.	 	Representations and Warranties. All representations and warranties
made under this Agreement shall be deemed made at and as of the date
hereof and at and as of the date of any advance or loan made under the
Loan Documents.




6. Presentment, Demands and Notices. Except to the extent provided in this Agreement and any Loan
Document, Borrower hereby waives and shall cause any Guarantors and Debtors to waive all of their
respective rights to presentment, demand, protest, notice of intent to accelerate, notice of
acceleration and other notices (including, but not limited to, notice of dishonor, default,
nonpayment and the creation, existence and extension of any and all indebtedness and Obligations
under this Agreement and the Loan Documents and of any security and collateral therefor) to the
maximum extent permitted by law.



All notices and other communications given or made pursuant to this Agreement or any of the Loan
Documents shall be in writing and shall be deemed effectively given upon the earlier of actual
receipt or: (a) personal delivery to the party to be notified, (b) three (3) days after having
been sent by registered or certified mail, return receipt requested, postage prepaid, or (c) one
(1) business day after deposit with a nationally recognized overnight courier, freight prepaid,
specifying next business day delivery, with written verification of receipt. All communications
shall be sent to the respective parties at their address as set forth on the signature page or, or
to such address as subsequently modified by written notice given in accordance with this Agreement.



7. Default. Borrower shall be in default (“Default”) under this Agreement and the Loan Documents
in the event that Borrower, any Guarantor and Debtor, or any other party guarantying or securing
the Loan:





	 	a.	 	fails to pay any monetary obligation to Lender;




13









 






	 	b.	 	fails to perform any obligation or breaches any warranty or covenant to Lender
contained in this Agreement or the Loan Documents or any other present or future
written agreement with Lender;
	 
	 	c.	 	allows or causes the Collateral to be damaged in any material respect,
destroyed, lost stolen, seized, or confiscated to the extent not covered by insurance
and it could reasonably be expected to result in a material and adverse change in
Borrower’s business operations or financial condition, taken as a whole, or materially
affect the Collateral;
	 
	 	d.	 	seeks to revoke, terminate or otherwise limit its liability to Lender under the
Loan Documents;
	 
	 	e.	 	is dissolved or terminated, ceases to operate its business, becomes insolvent,
makes an assignment for the benefit of creditors, or becomes the subject of any
bankruptcy, insolvency or debtor rehabilitation proceeding; or
	 
	 	f.	 	shall be in material default under any note, loan agreement, indenture,
mortgage, deed of trust, security agreement or any other agreement or obligation to
which they are a party, or by which any of their respective properties may be bound,
whether with Lender or some third party which default could reasonably be expected to
result in a material and adverse change, taken as a whole, in the business operations
or financial condition of Borrower or materially affect the Collateral.




During any time while the Borrower is in Default, the Lender is not required to make any additional
advances under the Line.



A Default shall become an “Event of Default” if:





	 	i.	 	The Default by its nature cannot be cured or
remedied through the efforts of Borrower.
	 
	 	ii.	 	In the case of failure to pay principal, interest
or other monetary obligation under the Loan Documents, the Default is not
cured within ten (10) days following written notice from Lender to
Borrower.
	 
	 	iii.	 	In the case of a breach of the covenants in
Paragraph 5aq, ten (10) days after the submission of the applicable
compliance certificate showing the breach, if an investment in the
Borrower in the form of additional equity or Subordinated Liabilities is
not made such that, had the investment been made on the final day of the
testing period, the covenant would not have been breached.
	 
	 	iv.	 	In all other cases, the Default is not cured or
remedied within thirty (30) days following written notice from Lender to
Borrower




8. Rights of Lender on an Event of Default. If there is an Event of Default under this Agreement
or any of the Loan Documents, Lender shall be entitled to exercise one or more of the following
remedies without further notice or demand (except as required by law) while such Event of Default
is continuing:





	 	a.	 	Acceleration — to declare Borrower and any Guarantors or Debtors’ obligations
to Lender to be immediately due and payable in full (less any rebates or credits as
applicable);




14









 






	 	b.	 	Collection Without Judicial Process — to collect Borrower and any Guarantors or
Debtors’ outstanding obligations with or without resorting to judicial process;
	 
	 	c.	 	Delivery of Collateral — to require Borrower and any Debtors to deliver and
make available to Lender any Collateral at a place reasonably convenient to Lender and
those entities;
	 
	 	d.	 	Take Possession — to take immediate possession, management and control of the
Collateral without seeking the appointment of a receiver;
	 
	 	e.	 	Collection of Proceeds — to collect all rents, issues, income, profits and
proceeds from the Collateral until Borrower and any Guarantors and Debtors’ obligations
to Lender are satisfied in full;
	 
	 	f.	 	Appointment of Receiver — to apply for and obtain, without notice and upon ex
parte application, the appointment of a receiver for the Collateral without regard to
Borrower or any Guarantors and Debtors’ financial condition or solvency, the adequacy
of the Collateral to secure the payment or performance of the obligations of those
entities to Lender, or the existence of any waste to the Collateral;
	 
	 	g.	 	Foreclosure — to foreclose any deed of trust, mortgage, lien, security interest
or other encumbrance on the Collateral in accordance with the Loan Documents;
	 
	 	h.	 	Setoff — to setoff Borrower and any Guarantors and Debtors’ obligations to
Lender against any amounts due to those entities including, but not limited to, the
Borrower and Guarantors and Debtors’ monies, instruments, and deposit accounts
maintained with Lender; and
	 
	 	i.	 	Lender’s Contractual Rights — to exercise all other rights available to Lender
under the Loan Documents, any other written agreement, or applicable law.




Lender’s rights are cumulative and may be exercised together, separately, and in any order. In the
event that Lender institutes an action seeking recovery of any of the Collateral by way of a
prejudgment remedy in an action against Borrower or Debtors, Borrower hereby waives and shall cause
Debtors to waive the posting of any bond which might otherwise be required.



9. Waiver of Exemptions. Borrower hereby waives and shall cause any Debtors to waive all homestead
exemptions and other exemptions, to the extent they may lawfully do so, to which those entities
would otherwise be entitled with respect to the Collateral under any applicable law.



10. Hold Harmless and Indemnification. Lender shall not be responsible for the performance of any
of Borrower or any Debtors’ obligations with respect to the Collateral under any circumstances.



Borrower hereby indemnifies and holds Lender harmless, and shall cause any Guarantors and Debtors
to indemnify and hold Lender harmless, from all claims, damages, liabilities (including attorneys’
fees and legal expenses), causes of action, actions, suits and other legal proceedings
(cumulatively, “Claims”) pertaining to their respective businesses or the Collateral (including,
but not limited to, those Claims involving Hazardous Materials) except to the extent such Claims
are attributable to the gross negligence or willful misconduct on the part of Lender. Borrower
shall immediately provide and cause any Guarantors and Debtors to immediately provide Lender with
written notice of any such Claim. Borrower, upon the request of Lender, shall defend or cause such
Guarantors and Debtors to defend Lender from such Claims, and pay the attorneys’ fees, legal
expenses and other costs incurred in connection therewith. In the alternative, Lender


15









 






shall be entitled to employ its own legal counsel to defend such Claims at Lender and/or such
Guarantors and Debtors’ cost.



11. Reimbursement for Expenses. Borrower shall reimburse when due or cause any Guarantors and
Debtors to reimburse Lender when due for all amounts (including attorneys’ fees and legal expenses)
reasonably expended by Lender, to the extent permitted by this Agreement or applicable law, in the:
(i) negotiation, preparation, amendment, extension, modification, replacement or substitution of
this Agreement or the Loan Documents, (ii) the administration of the loans and other financial
accommodations described in this Agreement and the Loan Documents, (iii) attachment, creation,
filing, perfection, and recording of Lender’s liens, security interests, and other encumbrances in
the Collateral or any UCC and other searches and title or insurance policies in connection
therewith; (iv) defense of the validity and priority of Lender’s liens, security interests and
other encumbrances against the Collateral, and (v) enforcement or defense of any obligation or the
exercise of any right or remedy described in this Agreement or the Loan Documents. Lender shall
provide Borrower with written notice to Borrower that such sums are due as provided in this
paragraph (accompanied by reasonable supporting documentation) and Borrower shall have ten (10)
days thereafter to pay such sums in full. These sums shall bear interest at the lower of the
highest rate described in any of the Loan Documents or allowed by law from the date of payment
until the date of reimbursement and be secured by the Collateral.



12. Application of Monies. All payments to Lender made by or on behalf of Borrower or any
Guarantors and Debtors or monies received by Lender from the Collateral or otherwise on account of
a Default may be applied against any amounts paid by Lender in connection with the exercise of its
rights or remedies described in this Agreement and the Loan Documents (including attorneys’ fees
and legal expenses together with interest at the rate described in the foregoing paragraph) and
then to the payment of the remaining obligations under this Agreement and the Loan Documents in
whatever order Lender chooses.



13. Power of Attorney. Borrower hereby appoints and shall cause any Guarantors and Debtors,
jointly and severally, to appoint Lender as their attorney-in-fact to endorse their names on all
instruments and other documents payable to those entities. Unless an Event of Default has occurred
and is continuing, any funds received on account of the endorsement of checks payable to the
Borrower or any Debtor shall be deposited in the bank account of the Borrower or any Debtor, as
applicable. In addition, Lender shall be entitled, but not required, to perform any action or
execute any document required to be taken or executed by Borrower or any Guarantors and Debtors
under this Agreement or the Loan Documents, including, but not limited to, executing and filing any
financing statements, fixture filings, continuation statements, notices of security interest and
other documents required by the Uniform Commercial Code and other applicable law. Lender’s
performance of such action or execution of such documents shall not relieve Borrower or any
Guarantors and Debtors from any obligation to cure any default under this Agreement and the Loan
Documents. The powers of attorney described in this paragraph are coupled with an interest and are
irrevocable.



14. Essence of Time. Borrower and Lender agree that time is of the essence with respect to this
Agreement and the Loan Documents.



15. Modification and Waiver. The modification or waiver of any of Borrower or any Guarantors and
Debtors’ Obligations or Lender’s rights under this Agreement or the Loan


16









 






Documents must be contained in a writing signed by Lender and Borrower. Lender may perform any of
Borrower or any Guarantors and Debtors’ Obligations or delay or fail to exercise any of its rights
without causing a waiver of those Obligations or rights. A waiver on one occasion shall not
constitute a waiver on any other occasion. Borrower and any Guarantors and Debtors’ Obligations to
Lender under this Agreement and the Loan Documents shall not be affected if Lender amends,
compromises, exchanges, fails to exercise, impairs or releases any of the Obligations belonging to
any co-Borrower, Guarantor or obligor or any of its rights against any co-Borrower, Guarantor,
obligor or Collateral.



16. Successors and Assigns. This Agreement and the Loan Documents shall be binding upon and inure
to the benefit of Borrower, Lender, and their respective successors, assigns, trustees, receivers,
administrators, personal representatives, legatees and devisees.



17. Assignment and Participations. Borrower and any Guarantors and Debtors shall not be entitled
to assign any of their rights, remedies or obligations described in this Agreement or the Loan
Documents without the prior written consent of Lender which may be withheld by Lender in its sole
discretion. Upon notice to Borrower, Lender shall be entitled to grant participations in or assign
some or all of its rights and remedies described in this Agreement and the Loan Documents to any
federally insured financial institution without the prior consent of Borrower or any Guarantors and
Debtors in any manner. Except as provided in the preceding sentence, Lender shall not be entitled
to assign any of its rights, remedies or obligations described in this Agreement or the Loan
Documents without the prior written consent of Borrower, which will not be unreasonably withheld,
delayed or conditioned. Each actual or proposed participant or assignee, upon execution of a
confidentiality agreement, shall be entitled to receive all information provided to Lender
regarding Borrower, any Guarantors and Debtors, Collateral or otherwise pertaining to the loans
and/or other financial accommodations evidenced by this Agreement and the Loan Documents.



18. Notices. Any notice or other communication to be provided under this Agreement or the Loan
Documents shall be in writing and sent to the parties at the addresses described in this Agreement
or the Loan Documents or such other address as the parties may designate in writing from time to
time.



19. Severability. If any provision of this Agreement or the Loan Documents violates the law or is
unenforceable, the remainder of this Agreement and the Loan Documents shall continue to be valid
and enforceable in all respects.



20. Compliance With Applicable Law. It is Lender’s intention to comply fully with Texas law, and
federal law as applicable, regulating credit terms, interest, fees, charges, expenses, and other
amounts. For purposes of determining Lender’s compliance with such laws, the following shall apply
to the extent permitted by law: (a) any contract, charge or receipt by Lender, whether occurring
now or in the future, shall be strictly limited by this provision; (b) the “Maximum Lawful Rate”
shall mean the maximum lawful ceiling, rate or amount that Lender could have contracted to charge
or receive under Texas law or applicable federal law, whichever permits the highest maximum
ceiling, rate or amount; (c) to the extent Section 303.003 of the Texas Finance Code, as amended,
provides the Maximum Lawful Rate, the “indicated rate ceiling” shall apply unless changed by Lender
in accordance with Texas law; (d) Lender may calculate rates or amounts by aggregating, amortizing,
prorating, allocating, and spreading amounts contracted for, charged or received over the full term
of the transaction; (e) no contract, charge or receipt shall


17









 






obligate Borrower or any obligor to pay any amount in excess of the Maximum Lawful Rate or waive
any right under the Texas Finance Code; and (f) any contract, charge or receipt that in the event
of acceleration or under any other contingency purports to require the payment or collection of any
amount in excess of the Maximum Lawful Rate shall automatically be reformed to not obligate
Borrower or any other obligor to pay any amount in excess of the Maximum Lawful Rate. If Lender
ever contracts for, charges or receives a rate or amount in excess of the Maximum Lawful Rate, the
excess (whether denominated principal, interest or otherwise) shall be automatically subject to
reallocation, cancellation, credit application, or refund to eliminate any amount in excess of the
Maximum Lawful Rate.



21. APPLICABLE LAW. EXCEPT TO THE EXTENT THAT THE VALIDITY AND PERFECTION OR THE PERFECTION AND
THE EFFECT OF PERFECTION OR NON-PERFECTION OF ANY SECURITY INTEREST CREATED HEREBY, OR REMEDIES
HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER
THAN THE STATE OF TEXAS, THIS AGREEMENT SHALL BE SUBJECT TO AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS WITHOUT GIVING EFFECT TO ANY CONFLICTS OF LAWS
PRINCIPLES. BORROWER CONSENTS TO THE JURISDICTION AND VENUE OF ANY COURT LOCATED IN THE COUNTY IN
WHICH THIS AGREEMENT IS SIGNED OR IN WHICH BORROWER RESIDES IN THE EVENT OF ANY LEGAL PROCEEDING
UNDER THIS NOTE.



22. Other Collateral. Collateral securing other loans with Lender may also secure this loan. To
the extent collateral previously has been given to Lender by any person that may secure this loan,
whether directly or indirectly, it is specifically agreed that, to the extent prohibited by law,
all such collateral consisting of household goods will not secure this loan. In addition, if any
collateral requires the giving of a right of rescission under the Truth in Lending Act for this
loan, such collateral also will not secure this loan unless and until all required notices of that
right have been given.



23. Non-Compliance Fee. Borrower shall pay Lender upon demand, a non-compliance fee of $500.00
per instance that Borrower is more than thirty (30) days past due, following written notice
thereof, in providing Lender with proof of insurance, financial reports, compliance certificates
and other similar items as required in this Agreement and the Loan Documents, provided the
non-compliance fee will not be assessed again for the same failure unless Lender provides written
notice of its intention to assess such non-compliance fee again and such failure continues on the
part of Borrower following the expiration of ten (10) days after such notice.



24. Overline Fee. Borrower shall pay Lender upon demand, an overline fee of $200.00 per instance
that Borrower requests an advance under the Line that causes the aggregate principal outstanding
balance of all unpaid advances under the Line to exceed the Maximum Amount as set forth in the
Borrowing Base Agreement.



25. Further Assurances. Borrower shall promptly make, execute, and deliver and cause Debtor to
promptly make, execute, and deliver any and all agreements, documents, instruments and other
records that the Lender may request to evidence the Loan, cure any defect or error in the execution
and/or the delivery of any of the Loan Documents, perfect any lien, comply with


18









 






any legal requirement applicable to the Lender or the Loan or describe more fully particular
aspects of the agreements set forth or intended to be set forth in any of the Loan Documents.



26. Lease Assignments. Borrower agrees to use commercially reasonable efforts to obtain and
deliver to Lender leasehold Deed of Trusts or other forms of an assignments of lease covering
Borrower’s real property leases for 3300 Duval Road, Austin, Texas 78759 and 7 Wesvalley Rd., Suite
2, Lake Placid, New York 12946 in a form and substance reasonably satisfactory to Lender with
ninety (90) days after the date of this Agreement.



27. Miscellaneous. All references to Borrower shall refer to all of the parties signing below.
Borrower’s Obligations to Lender shall be joint and several. This Agreement and the Loan Documents
represent the complete and integrated understanding between Borrower, any Guarantors or Debtors,
and Lender pertaining to the terms and conditions of those documents and the loans and other
financial accommodations described therein.



28. Conflict with Loan Documents. If the terms of any Loan Document conflicts with the terms of
this Agreement, the terms of this Agreement shall control.



29. Attorneys Fees. If any action at law or in equity is necessary to enforce or interpret the
terms of this Agreement and any of the Loan Documents, the prevailing party shall be entitled to
reasonable attorneys’ fees, costs and necessary disbursements in addition to any other relief to
which such party may be entitled.



30. Certain Definitions. For purposes of this Agreement and the Loan Documents, the following
definitions will apply:




     “Affiliate” means, as to any person, any other person that, directly or indirectly,
through one or more intermediaries, controls, is controlled by, or is under common control with,
such person or any subsidiary of such person. The term “control” (including the terms “controlled
by” or “under common control with”) means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a person, whether through ownership
of a voting securities, by contract, or otherwise.



     “Diagnostic Initiative” means any project or program pursued by the Borrower or any
Debtor with a view to the development and commercialization of diagnostic products or services,
including without limitation, the strategic collaboration between Borrower and Psynova Neurotech
Limited.



     “Diagnostic Initiatives Losses” means the excess, if any, of (i) the losses, costs and
expenses reflected on the books and records of the Borrower or any Debtor associated with a
Diagnostic Initiative, including, without limitation, net losses that flow through to the Borrower
or any Debtor by virtue of either consolidation or equity based accounting for the equity
investment of the Borrower or any Debtor in Psynova Neurotech Limited, over (ii) the revenues
reflected on the books and records of the Borrower or any Debtor associated with a Diagnostic
Initiative, including, without limitation, net profits that flow through to the Borrower or any
Debtor by virtue of either consolidation or equity based accounting for the equity investment of
the Borrower or any Debtor in Psynova Neurotech Limited.



19









 





     “GAAP” or “Generally Accepted Accounting Principles” means United States
generally accepted accounting principles as in effect from time to time, applied on a consistent
basis.



     “Permitted Liens” means any of the following:



     (a) liens securing any obligations to the Lender;



     (b) liens or security interests securing any indebtedness or liabilities resulting from
borrowings, loans or advances of the Borrower as permitted under Paragraph 5ar(ii);



     (c) liens for taxes, assessments, or other governmental charges or levies not yet due; and



     (d) liens in favor of vendors, carriers, warehousemen, repairmen, mechanics, workmen,
materialmen, construction, or similar liens arising by operation of law in the ordinary course of
business in respect of obligations that are not yet due.


Dated this
10th day of August, 2009.



This Agreement and related documents have been signed in the County of Lender’s address unless
otherwise specified.



THIS WRITTEN LOAN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.




	 	 	 	 	 	 	 	 	 	 	 
	BORROWER:	 	 	 	LENDER:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	RULES-BASED MEDICINE, INC.,

a Delaware corporation	 	 	 	COMPASS BANK	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:
	 	/s/
Patrick McClain 	 	 	 	By:	 	/s/
Todd Jordan 	 	 
	 
	 	Patrick McClain, Chief Financial Officer	 		 	 	 	Todd Jordan, Senior Vice President	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Address for Notice:	 	 	 	Address for Notice:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	3300 Duval Road 

Austin, Texas 78759	 	 	 	5800 North Mopac

Austin, Texas 78731	 	 






20










 








SCHEDULE A




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	INTEREST	 	PRINCIPAL AMOUNT/	 	FUNDING/	 	MATURITY	 	CUSTOMER	 	LOAN
	RATE	 	CREDIT LIMIT	 	AGREEMENT DATE	 	DATE	 	NUMBER	 	NUMBER
	Wall Street
	 	$	9,000,000.00	 	 	 	8/10/2009	 	 	 	8/10/2011	 	 	 	 	 	 	 	 	 
	Journal’s Prime
Rate, + 0.375%
floating, per
annum, not less
than 4.0%, per
annum.
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 






SCHEDULE B





	1.	 	Revolving Promissory Note in the original principal sum of $9,000,000.00 executed by
Borrower.
	 
	2.	 	Commercial Security Agreement covering all of Debtor’s accounts receivable, inventory,
equipment and general intangibles, now owned, or hereinafter acquired, executed by Debtor.
	 
	3.	 	Security Agreement/Collateral Assignment covering all of Borrower’s patents and trademarks
	 
	4.	 	UCC-1 Financing Statement covering Item 2 above.
	 
	5.	 	Cover sheet and necessary filing documents with U.S Patent and Trademark offices to cover
perfection of Item 3 above.
	 
	6.	 	Certificate of Corporate Resolution.
	 
	7.	 	Landlord’s Subordinations.
	 
	8.	 	Agreement to Provide Insurance.
	 
	9.	 	Leasehold Deed of Trusts and/or other forms of an assignment of lease.
	 
	10.	 	Notice of Final Agreement executed by Borrower and Guarantor.
	 
	11.	 	Non-representation letter.


















 





EXHIBIT “B”




COMPLIANCE CERTIFICATE




     This Compliance Certificate is delivered pursuant to Paragraph 5 (q.) (iv) of the
Commercial
Loan Agreement dated August      , 2009 (together with all amendments and modifications, if any,
from time to time made thereto, the “Loan Agreement”), between Rules-Based Medicine, Inc., a
Delaware corporation (the “Borrower”) and Compass Bank. Unless otherwise defined, terms used
herein (including the attachments hereto) have the meanings provided in the Loan Agreement.



     The undersigned, being the duly elected, authorized and qualified                      of Borrower, on behalf of the Borrower and solely in his or her capacity as a                      of the
Borrower, hereby certifies and warrants that:



	 	 	 	 	 	 	 
	     1.	 	The undersigned is a                     of the Borrower and
that, as such,
is authorized to execute this certificate on behalf of
the Borrower.	 	 
	 
	 	 	 	 	 	 
	     2.	 	As of                     , 20     :	 	COMPLIANCE
	 
	 	 	 	 	 	 
	 

	 	(a)
	 	 The Borrower was not in default of any of
the provisions of the Loan Agreement
during the period
as to which this Compliance Certificate
relates;
	 	YES/NO
	 
	 	 	 	 	 	 
	 

	 	(b)
	 	 Debt Service Coverage Ratio. Borrower’s
Debt Service Coverage Ratio was at least
                     to
1.0 as computed on Attachment 1 hereto; and
	 	YES/NO
	 
	 	 	 	 	 	 
	 

	 	(c)
	 	 Tangible Net Worth. Borrower’s Tangible
Net Worth was at least $6,500,000.00,
as computed on
Attachment 1 hereto.
	 	YES/NO
	 
	 	 	 	 	 	 
	 

	 	(d)
	 	 Fixed Charge Coverage Ratio. Borrower’s
Fixed Charge Coverage Ratio was at least 1.50 to 1.0
as computed on Attachment 1 hereto.
	 	YES/NO






     IN WITNESS WHEREOF, the undersigned has executed and delivered this certificate, this
                    day of                     , 20      .



	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:
	 	 

	 	 
	 

	 	 	 	 

	 	 





Compliance Certificate




 








 







EXHIBIT “C”

BORROWING BASE AGREEMENT




     This Exhibit “C” is made a part of that certain Commercial Loan Agreement dated as of August
10, 2009 (together with all amendments and modifications, if any, from time to time
made thereto, the “Agreement”), between RULES-BASED MEDICINE, INC., a Delaware corporation
(“Borrower”) and COMPASS BANK (“Lender”).



     1. Borrowing Base. The aggregate principal amount advanced and remaining unpaid pursuant to
the terms of that certain revolving promissory note dated August 10, 2009 in the principal amount
of $9,000,000.00 (the “Note”) shall not exceed the lesser of $9,000,000.00 or the Maximum Amount.




     The term “Maximum Amount” shall mean the lesser of (a) the sum of (i) 85% of Borrower’s
Eligible Accounts Receivable from eligible domestic and Canadian accounts receivable, (ii)
90% of Borrower’s Eligible Accounts Receivable on international and foreign accounts
receivable covered by receivable insurance issued by an issuer reasonably acceptable to
Lender, (iii) 70% of Borrower’s Eligible Accounts Receivable on international and foreign
accounts receivable not covered by receivable insurance that arc from a foreign subsidiary
of a domestic based publicly traded company not to exceed $500,000.00, (iv) 50% of
Borrower’s Eligible Accounts Receivable on international and foreign accounts receivable not
covered by receivable insurance not to exceed $500,000.00 and (v) 60% of the value of
Eligible Inventory provided, however, that the outstanding principal balance of all advances
against Borrower’s Eligible Inventory shall not at any time exceed in the aggregate the
lesser of 150% of Borrower’s margined Eligible Accounts Receivable or $4,500,000.00 or (b)
an amount that, when used as the pro forma “Borrowing Base” and amortized over three (3)
years for purposes of calculating the Pro Forma Debt Service Coverage Ratio as provided in
item (10) of Paragraph 5aq(ii) of the Commercial Loan Agreement as of the end of the
previous four (4) quarters, would allow for Borrower to comply with the Pro Forma Debt
Service Coverage Ratio test under Section 5aq(ii) of the Commercial Loan Agreement as of the
end of such previous four (4) quarters.



     As used herein, “Eligible Accounts Receivable” shall mean the aggregate of all accounts
receivable of Borrower which have been created in the ordinary course of Borrower’s business and
upon which Borrower’s right to receive payment is absolute and not contingent upon the fulfillment
of any condition whatsoever, and in which Lender has a perfected security interest, and shall not
include:




any account which is more than ninety (90) days past due;




any account for which there exists a right of set off, defense or discount for which
there has been an assertion by a third party of any valid set off, defense or
discount, except regular discounts allowed in the ordinary course of business to
promote prompt payment and (for which no defense or counterclaim has been asserted);



 








 








any account which represents an obligation of any local, state or federal
governmental agency or entity, unless the assignment of such account is permitted
by the Assignment of Claims Act or similar statute, and Borrower has complied with
all conditions for such an assignment to be made to the reasonable satisfaction of
Lender;




any account which arises out of a contract or order which, by its terms, forbids
or makes void or unenforceable any assignment by Borrower to Lender of the account
receivable arising with respect thereto;




any account which arises from the sale or lease to or performance of services for,
or represents an obligation of, an employee, Affiliate, partner, parent or
subsidiary of Borrower;




any account which represents an obligation of a Customer of Borrower when 30% or
more of Borrower’s accounts from such Customer are not eligible pursuant to any of
the preceding exclusions from the definition of Eligible Account Receivable;




and any account on which the Lender is not or does not continue to be, in the
Lender’s reasonable discretion, satisfied with the credit standing of the Customer
of Borrower in relation to the amount of credit extended.



     “Eligible Inventory” shall mean the aggregate of all of Borrower’s inventory other than (a)
work in process; (b) in the event that the Lender has taken a security interest in the inventory,
all inventory in which the Lender does not have a first priority perfected security interest; (c)
inventory which is not located at 3300 Duval Road, Austin, Texas 78759 and/or 7 Wesvallcy Rd.,
Suite 2, Lake Placid, New York 12946; (d) inventory on consignment; (e) repossessed inventory; (f)
obsolete inventory; (g) inventory that is not in good condition or that fails to meet government
standards; and (h) inventory that the Lender in its reasonable discretion determines to be
ineligible. Inventory will be valued based on the book value carried on Borrower’s books and
records.



     “Customers” shall mean the account debtors obligated on the Accounts Receivable.



     “Accounts Receivable” shall mean the aggregate of all of the Borrower’s accounts,
instruments, contract rights, chattel paper, documents, and general intangibles arising from the
sale of goods and/or the rendition of services by the Borrower in the ordinary course of business,
and the proceeds thereof and all security and guaranties therefor, whether now existing or
hereafter created, and all returned, reclaimed or repossessed goods, and all books and records
pertaining to the foregoing.



     2. Reporting. In addition to any reporting requirements required under the Commercial
Loan Agreement to which this Borrowing Base Exhibit is attached, the Borrower




 








 







will submit the following in form and substance satisfactory to Lender on the schedules set forth
below and on the date of each request for an advance under the Note:





Accounts Receivable Aging. Not later than twenty (20) days after and as of the
end of each month, a listing of accounts receivable aged from date of invoice.




Listing of Inventory. Not later than twenty (20) days after and as of the end of each
month, or on the request of Lender, a list of the Borrower’s Inventory.




Ineligible Report. Not later than twenty (20) days after and as of the end of each
month in the form attached hereto as Exhibit C–1.



     3. Mandatory Payment. In the event the aggregate principal outstanding balance of
advances under the Note exceed the Borrowing Base, Borrower shall immediately and without notice or
demand of any kind, make such payments as shall be necessary to reduce the principal balance of the
Note below the Borrowing Base.



	 	 	 	 	 	 	 	 	 
	BORROWER:	 	LENDER:	 	 
	RULES-BASED MEDICINE, INC.,

a Delaware corporation	 	COMPASS BANK	 	 
	 
	By:

	 	/s/ Pat McClain
 

Pat McClain, Chief Financial Officer
	 	By:
	 	/s/ Todd Jordan
 

Todd Jordan, Senior Vice President
	 	 







 











 










					
	 	 	 	 	 
	
	 	EXHIBIT C
	 	 






ACCOUNTS RECEIVABLE AND INVENTORY RECONCILIATION




	 	 	 	 	 	 	 	 	 	 	 
	Company:	 	Rules-Based Medicine	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 
	Line Amount:	 	$                                                                          9,000,000.00	 	 	 	Period Ending:	 	 
	 
	 	 	 	 	 	 	 	 	 
	
ACCOUNTS RECEIVABLE AND INVENTORY RECONCILIATION FORM
	 
	1. Accounts Receivable	 	 	 	 	 	 
	 
	 	a.	 	Total Receivables	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	b.	 	Less: Accounts over 90 days old	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 
	 
	 	c.	 	Less: Other	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 
	 
	 	d.	 	Other Adjustments	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 
	 
	 	e.	 	Total Ineligibles	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	f.	 	Total Available Accounts Receivable Less Ineligibles for this Period:
	 
	 	 	 	 	 	 	 	 	 	 
	2. Inventory	 	 	 	 	 	 
	 
	 	a.	 	Total Inventory	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 
	 
	 	b.	 	Less: Work in Process	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 
	 
	 	c.	 	Less: Other	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 
	 
	 	d.	 	Other Adjustments	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 
	 
	 	e.	 	Total Ineligibles	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	f.	 	Total Inventory Less Ineligibles for this period:
	 
	 	 	 	 	 	 	 	 	 	 
	
LOAN REQUEST
	 
	3. Loan Value of Above Collateral	 	 	 	 	 	 
	 
	 	a.	 	Net Accounts Receivable Loan Value	 	 	 	(‘Ineligibles’ line N.)	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	b.	 	Net Inventory Loan Value	 	 	 	(60% of line 2f.) 	60%	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	INVENTORY CAP (The lesser of 3b., 150% of 3a., or $4,500,000)  
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 
	 
	 	c.	 	Inventory Cap	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	d.	 	Total Collateral Value for this Period	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	e.	 	Net Borrowing Base	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	f.	 	Commitment amount	 	 	 	$9,000,000	 	 
	 
	 	 	 	 	 	 	 	 	 
	 	 	g.	 	Net Eligible Collateral Value for this Period (lesser of 3e or 3f)
	 
	 	 	 	 	 	 	 	 	 	 
	3. Loan Balance	 	 	 	 	 	 
	 
	 	a.	 	Loan Balance from Last Report	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 
	 
	 	b.	 	Add: Draws	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 
	 
	 	c.	 	Less: Payments	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 
	 
	 	d.	 	Loan Balance for this Period	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	
Cash Flow Variables	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Rate                    	 	Dsc     1.35     Cash Flow     
	 
	 	 	 	 	 	 	 	 	 
	4. Max Draw Availability	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	4. Excess (Deficit)	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 






—BORROWER CERTIFICATION—



The undersigned hereby warrants that the foregoing is a correct statement regarding the
assignment of new accounts receivable, collection of accounts receivable assigned to Compass
Bank and that the reconciliation figures are fully and correctly set forth.




	 	 	 	 	 
	 

	 	 	 	 
	Authorized Signature

	 	 
	 	Title























 





EXHIBIT C-1









	 	 	 	 	 	 	 	 	 
	

	 	Rules-Based Medicine

Ineligible Report
	 	Date:

Period Ending:
	 	 	 	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 





	 	 	 	 	 	 	 	 	 
	 

	 	In accordance with the Credit Agreement dated July XX, 2009 by and between Rules-Based
Medicine, Inc., a Texas corporation (“Borrower”), and Compass Bank
(“Lender”), I                     ,                     
of the Borrower hereby certify and warrant that the following schedule accurately states
Borrower’s Eligible Accounts Receivable, and Borrower’s Borrowing Base as of the date
hereof:
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 
	A.

	 	U.S. Domestic & Canadian account totals:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	B.

	 	Less U.S. Domestic & Canadian accounts over 90 days old:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	C.

	 	Less other:	 	 	 	 	 	 
	 

	 	U.S. Domestic & Canadian accounts less ineligibles:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Advance Rate:
	 	 	 	85%
	 

	 	 	 	 	 	 	 	 
	 

	 	Total Eligible U.S. Domestic & Canadian accounts:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	D.

	 	Insured International account totals1:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	E.

	 	Less Insured International accounts over 90 days old1:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	F.

	 	Less other1:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	Insured International accounts less ineligibles1:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Advance Rate:
	 	 	 	90%
	 

	 	 	 	 	 	 	 	 
	 

	 	Total Eligible Insured accounts:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	G.

	 	Uninsured International U.S.
Subsidiary account totals2:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	H.

	 	Less Uninsured International U.S. Subsidiary accounts over 90 days old2:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	I.

	 	Less other2:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	Uninsured International U.S. Subsidiary accounts less ineligibles2:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Advance Rate:
	 	 	 	70%
	 

	 	 	 	 	 	 	 	 
	 

	 	Total Eligible
Uninsured International U.S. Subsidiary accounts—Capped at $500,000:	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	J.

	 	Uninsured International account totals:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	K.

	 	Less Uninsured International accounts over 90 days old:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	L.

	 	Less other:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	Uninsured International accounts less ineligibles:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Advance Rate:
	 	 		50%
	 

	 	 	 	 	 	 	 	 
	 

	 	Total Eligible Uninsured International accounts—Capped at $500,000:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	M.

	 	TOTAL INELIGIBLE ACCOUNTS:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	N.

	 	TOTAL ELIGIBLE ACCOUNTS RECEIVABLE:	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 
	1

		 Insured accounts receivable placed through and/or approved by BBVA Compass subsidiary, Compass
Insurance. Subject to a formal underwriting approval process.	 	 	 	 	 	 
	 
	2

	 	International accounts that are from a foreign subsidiary of a Domestic based Publicly-Traded
Company	 	 	 	 	 	 




















 










ATTACHMENT 1




Calculation as of Quarter ending                     




	 	 	 	 	 
	TANGIBLE NET WORTH:
	 	 	 	 
	Total Owners Equity
	 	 	 	 
	Plus: Subordinated Debt
	 	 	 	 
	Less: Note Receivable (owner/affiliate)
	 	 	 	 
	Less: Prepaid Rent
	 	 	 	 
	Less: Other Receivables
	 	 	 	 
	Less: Employee Advances
	 	 	 	 
	Less: Intangibles, net
	 	 	 	 
	Less: Goodwill, net
	 	 	 	 
	Less: Investments
	 	 	 	 
	Less: Investment in Subsidiary (excluding EDI)
	 	 	 	 
	 
	 	 	 
	Required minimum covenant total of at least $6,500,000                                                             
   Total
	 	$	0	 
	 
	 	 	 	 
	PRO-FORMA DEBT SERVICE COVERAGE RATIO: (Rolling 4 Quarters)
	 	 	 	 






	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	MARCH	 	 	JUNE	 	 	SEPT	 	 	DEC	 
	Net Income Before Tax
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Interest Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Depreciation
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Equity/acceptable sub debt
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Non-Cash Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less Dividends
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less. Distributions
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less. Non-Financed Cap Exp
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less. Cash Investments in Affiliates 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Subtotal
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	NIBT
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Interest Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Depreciation
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Equity/acceptable sub debt
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Non-Cash Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Dividends
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Distributions
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Non-Financed Cap Exp
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Cash Investments in Affiliates 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Subtotal
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Quarter to date NIBT
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Interest Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Depreciation
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Equity/acceptable sub debt
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Non-Cash Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Dividends
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Distributions
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Non-Financed Cap Exp
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Cash Investments in Affiliates 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Subtotal
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Cash flow available for Debt Service
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Existing CMLTD Paid
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	RLOC Balance at qrt end
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Interest Rate at qrt end
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Annual Pro-forma Debt Svc
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus. Interest Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Total
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Required minimum covenant ratio of at least 1.35:1 (1.50:1 starting Sept. 2009)

	Ratio
	 	 	 	 	 	 	 	 	 	 






Page 1 of 2









 











FIXED CHARGE COVERAGE RATIO: (Rolling 4 Quarters)




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	MARCH	 	 	JUNE	 	 	SEPT	 	 	DEC	 
	Net Income Before Tax
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Interest Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Depreciation
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Non-Cash Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Equity/acceptable sub debt
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Lease Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Taxes
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Dividends
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Distributions
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Non-Financed Cap Exp
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Cash Investments in Affiliates 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Subtotal
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	FYE NIBT
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Interest Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Depreciation
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Non-Cash Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Equity /acceptable sub debt
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Lease Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Taxes
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Dividends
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Distributions
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Non-Financed Cap Exp
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Cash Investments in Affiliates 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Subtotal
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Quarter to date NIBT
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Interest Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Depreciation
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Non-Cash Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Equity/acceptable sub debt
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Lease Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Taxes
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Dividends
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Distributions
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Non-Financed Cap Exp
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Cash Investments in Affiliates 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Subtotal
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Cash flow available for Debt Service
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Existing CMLTD Paid
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Lease Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Interest Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Required minimum Fixed Charge Coverage of at least 1.50:1

	Ratio
	 	 	 	 	 	 	 	 






	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	Its:
	 	 	 	Date:	 	 
	 

	 	 
	 	 	 	 
	 	 	 	 





Page 2 of 2









 











			
	
	 	EXHIBIT C






ACCOUNTS RECEIVABLE AND INVENTORY RECONCILIATION





	 	 	 	 	 	 	 	 	 	 	 	 	 
	Company:
	 	Rules-Based Medicine	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Line Amount:
	 	$	9,000,000.00	 	 	Period Ending:	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 





ACCOUNTS RECEIVABLE AND INVENTORY RECONCILIATION FORM


 




	 	 	 	 	 	 	 	 	 
	1. Accounts Receivable
	 	 	 	 	 	 	 	 
	a.  Total Receivables
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	b. Less: Accounts over 90 days old
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	c. Less. Other
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	d. Other Adjustments
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	e. Total Ineligibles
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	f. Total Available Accounts Receivable Less Ineligibles for this Period:
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	2. Inventory
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	a. Total Inventory
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	b. Less: Work In Process
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	c. Less. Other
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	d. Other Adjustments
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	e. Total Ineligibles
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	f. Total Inventory Less Ineligibles for this period:
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	LOAN REQUEST
	 
	 
	 	 	 	 	 	 	 	 
	3. Loan Value of Above Collatoral
	 	 	 	 	 	 	 	 
	a. Net Accounts Receivable Loan Value
	 	(‘Ineligibles’ line N.)	 	 	 	 
	 
	 	 	 	 	 	 	 
	b. Net Inventory Loan Value
	 	(60% of line 2f.)        60%	 	 	 	 
	 
	 	 	 	 	 	 	 
	INVENTORY CAP (The lesser of 3b, 150% of 3a., or $4,500,000)
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	c. Inventory Cap
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	d. Total Collateral Value for this Period
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	e. Net Borrowing Base
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	f. Commitment amount
	 	$	9,000,000	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	g. Net Eligible Collateral Value for this Period (lesser of 3e or 3f)
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	3. Loan Balance
	 	 	 	 	 	 	 	 
	a. Loan Balance from Last Report
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	b. Add: Draws
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	c. Less: Payments
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	d. Loan Balance for this Period
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	                                            Cash Flow Variables 
	 	 	 	 	 
	Rate           
 Dsc                     
1.50                     Cash Flow
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	4. Max Draw Availability
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	4. Excess (Deficit)
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 






—BORROWER CERTIFICATION—



The undersigned hereby warrants that the foregoing is a correct statement regarding the
assignment of new accounts receivable, collection of accounts receivable assigned to Compass
Bank and that the reconciliation figures are fully and correctly set forth.




	 	 	 	 	 	 	 
	 

Authorized Signature

	 	 
	 	 

Title
	 	 








 











 





EXHIBIT C-1









	 	 	 	 	 	 	 	 	 	 	 	 	 
	
	 	Rules-Based Medicine
	 	Date:
	 	 	 	 
	 
	 	Ineligible Report
	 	Period Ending:
	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 




In
accordance with the Credit Agreement dated July XX, 2009 by and
between Rules-Based Medicine, Inc., a Texas corporation (“Borrower”), and Compass Bank (“Lender”), I                              
       
    ,      
         
             
             
of the Borrower hereby certify and warrant that the following schedule accurately states Borrower’s Eligible Accounts Receivable, and Borrower’s Borrowing Base as of the date hereof:




	 	 	 	 	 	 	 
	A.	 	U.S. Domestic & Canadian account totals:
	 	 	 
	 	 	 
	 	 	 
	B.	 	Less U.S. Domestic & Canadian accounts over 90 days old:
	 	 	 
	 	 	 
	 	 	 
	C.	 	Less other:
	 	 	 
	 	 	 
	 	 	 
	 	 	U.S. Domestic & Canadian accounts less ineligibles:
	 	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	Advance Rate:	 	85%
	 	 	 
	 	 	 
	 	 	Total Eligible U.S. Domestic & Canadian accounts:
	 	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 	 
	D.	 	Insured International account totals1:
	 	 	 
	 	 	 
	 	 	 
	E.	 	Less Insured
International accounts over 90 days old1:
	 	 	 
	 	 	 
	 	 	 
	F.	 	Less
other1:
	 	 	 
	 	 	 
	 	 	 
	 	 	Insured International accounts less ineligibles1:
	 	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	Advance Rate:	 	90%
	 	 	 
	 	 	 
	 	 	Total Eligible Insured accounts:
	 	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 	 
	G.	 	Uninsured International U.S. Subsidiary account totals2:
	 	 	 
	 	 	 
	 	 	 
	H.	 	Less Uninsured International U.S. Subsidiary accounts over 90
days old2:
	 	 	 
	 	 	 
	 	 	 
	I.	 	Less other2:
	 	 	 
	 	 	 
	 	 	 
	 	 	Uninsured International U.S. Subsidiary accounts less ineligibles2:
	 	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	Advance Rate:	 	70%
	 	 	 
	 	 	 
	 	 	Total
Eligible Uninsured International U.S. Subsidiary accounts—Capped at
$500,000:
	 	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 	 
	J.	 	Uninsured International account totals:
	 	 	 
	 	 	 
	 	 	 
	K.	 	Less Uninsured International accounts over 90 days old:
	 	 	 
	 	 	 
	 	 	 
	L.	 	Less other:
	 	 	 
	 	 	 
	 	 	 
	 	 	Uninsured
International accounts less ineligibles:
	 	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	Advance Rate:	 	50%
	 	 	 
	 	 	 
	 	 	Total
Eligible Uninsured International accounts—Capped at $500,000:
	 	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 	 
	 	 	 
	 	 	 
	M.	 	TOTAL INELIGIBLE ACCOUNTS:      
	 	 	 	 
	 	 	 
	 	 	 
	N.	 	TOTAL ELIGIBLE ACCOUNTS RECEIVABLE:      
	 	 	 
	 	 	 
	 	 	 







 




			
	1	 	Insured accounts receivable placed through and/or approved by BBVA Compass subsidiary, Compass Insurance. Subject to a formal underwriting approval process.
	 
	2	 	International accounts that are from a foreign subsidiary of a Domestic based Publicly-Traded Company









 









 





ATTACHMENT 1









Calculation as of Quarter ending                                         




	 	 	 	 	 	 	 	 	 
	TANGIBLE NET WORTH:
	 	 	 	 	 	 	 	 
	Total Owners Equity
	 	 	 	 	 	 	 	 
	Plus: Subordinated Debt
	 	 	 	 	 	 	 	 
	Less: Note Receivable (owner/affiliate)
	 	 	 	 	 	 	 	 
	Less: Prepaid Rent
	 	 	 	 	 	 	 	 
	Less: Other Receivables
	 	 	 	 	 	 	 	 
	Less: Employee Advances
	 	 	 	 	 	 	 	 
	Less: Intangibles, net
	 	 	 	 	 	 	 	 
	Less: Goodwill, net
	 	 	 	 	 	 	 	 
	Less: Investments
	 	 	 	 	 	 	 	 
	Less: Investment in Subsidiary (excluding EDI)
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 
	Required
minimum covenant total of at least $6,500,000
	 	Total	 	$	0	 






PRO-FORMA DEBT SERVICE COVERAGE RATIO: (Rolling 4 Quarters)




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	MARCH	 	 	JUNE	 	 	SEPT	 	 	DEC	 
	Net
Income Before
Tax 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Interest Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Depreciation
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Equity/acceptable sub debt
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Non-Cash Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Dividends
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Distributions
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Non-Financed Cap Exp
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Cash Investments in Affiliates 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Subtotal
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	NIBT 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Interest Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Depreciation
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Equity/acceptable sub debt
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Non-Cash Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Dividends
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Distributions
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Non-Financed Cap Exp
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Cash Investments in Affiliates 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Subtotal
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Quarter to date NIBT 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Interest Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Depreciation
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Equity/acceptable sub debt
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Non-Cash Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Dividends
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Distributions
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Non-Financed Cap Exp
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Cash Investments in Affiliates 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Subtotal
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Cash flow available for Debt Service
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Existing CMLTD Paid
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	RLOC Balance at qrt end
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Interest Rate at qrt end
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Annual Pro-forma Debt Svc
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Interest Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Total
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 Required minimum
covenant ratio of at least 1.35:1 (1.50:1 starting Sept, 2009)	 	 	 	 	 	 	 	 





	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Ratio
	 	 
	 	 
	 	 
	 	 






Page 1 of 2




 









 








			
	 	 	 
	
	 	FIXED CHARGE COVERAGE RATIO:
(Rolling 4 Quarters)






	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	MARCH	 	 	JUNE	 	 	SEPT	 	 	DEC	 
	Net Income Before Tax 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Interest Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Depreciation
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Non-Cash Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Equity/acceptable sub debt
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Lease Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Taxes 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Dividends
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Distributions
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Non-Financed Cap Exp
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Cash Investments in Affiliates  
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Subtotal
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	FYE NIBT 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Interest Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Depreciation
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Non-Cash Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Equity/acceptable sub debt
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Lease Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Taxes
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Dividends
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Distributions
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Non-Financed Cap Exp
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Cash Investments in Affiliates  
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Subtotal
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Quarter to date NIBT 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Interest Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Depreciation
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Non-Cash Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Equity/acceptable sub debt
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Lease Expenses
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Taxes
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Dividends
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Distributions
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Non-Financed Cap Exp
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Less: Cash Investments in Affiliates 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Subtotal
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Cash flow available for Debt Service
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Existing CMLTD Paid
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Lease Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Plus: Interest Expense
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Total
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Required minimum Fixed Charge Coverage of at least 1.50:1
	 	 	 	 	 	 	 	 





	 	 	 	 	 	 	 	 	 	 	 
	Ratio

	 	
	 	
	 	
	 	
	 	






	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	Its:
	 	 	 	Date:	 	 
	 

	 	 
	 	 	 	 
	 	 	 	 





Page 2 of 2





 











 







REVOLVING PROMISSORY NOTE




					
	 	 	 	 	 
	$9,000,000.00
	 	Austin, Texas
	 	August 10, 2009






     For value received, the undersigned (“Makers,” whether one or more), jointly and severally if
more than one person, promise to pay to the order of COMPASS BANK, an Alabama state chartered bank
(the “Holder”) at its address 5800 North Mopac, Austin, Travis County, Texas 78731, in legal and
lawful money of the United States of America, the principal sum of NINE MILLION AND NO/100 DOLLARS
($9,000,000.00), together with interest from the date of this Note (the “Loan Date”) until
maturity, on the balance of that principal sum, from time to time, advanced and remaining unpaid,
at a varying rate per annum (the “Contract Rate”). The Contract Rate shall equal the lesser of (i)
the sum of the Prime Rate as quoted in the Wall Street Journal listing of Money
Rates, also known as the base rate on corporate loans by at least seventy-five percent (75%)
of the nation’s thirty (30) largest banks, plus three hundred seventy-five/thousandths
percent (0.375%), per annum, or (ii) Maximum Rate, provided, however, the Contract Rate shall
never be less than four percent (4.0%). The initial Contract Rate shall be four percent (4.0%), per
annum. Adjustments in the Contract Rate shall be made simultaneously with adjustments in the Prime
Rate. If the Prime Rate is no longer available or quoted, Holder may designate a different
comparable rate. Interest before maturity shall be calculated on the basis of a 360-day year, so
that the daily interest rate under this Note shall be 1/360th of the Contract Rate, unless such
calculation produces a usurious rate, in which event interest shall be calculated at the Maximum
Rate. Matured, unpaid principal and interest shall bear interest from maturity until paid, at the
lesser of (a) the Maximum Rate, or (b) a rate equal to the Contract Rate plus five percent (5.0%)
per annum. The term “Maximum Rate”, as used herein, means the greater of (i) the highest rate
permitted by applicable federal law, or (ii) a rate per annum equal to the indicated rate ceiling
determined weekly in accordance with the computation specified in Section 303.003, Texas Finance
Code, as such indicated rate ceiling is in effect from time to time during the term hereof, subject
to the provisions of Section 303.009, Texas Finance Code. If the Maximum Rate is increased by
statute or other governmental action subsequent to the date hereof, then the Makers agree that the
new Maximum Rate will be applicable hereto from the effective date of the new Maximum Rate, unless
such application is precluded by the statute or governmental action or by the general law of the
jurisdiction governing this instrument.



     Makers shall pay the indebtedness, principal and interest, evidenced by this Note (the
“Indebtedness”) as follows:




Accrued interest shall be due and payable monthly as it accrues, beginning
one (1) month after the Loan Date and continuing regularly thereafter on the
same day of each calendar month (or on the last day of the month in the
event any calendar month has no such date) until two (2) years after the
Loan Date (“Maturity Date”), when the entire balance hereof, principal and
accrued interest remaining unpaid, shall be then due and payable.













 





     To the extent permitted by law, a delinquency charge will be imposed in an amount not to
exceed five (5%) of any payment that is more than ten (10) days late. Makers agree not to send
Holder payments marked “paid in full,” “without recourse,” or similar language. If Makers send
such a payment, Holder may accept it without losing any of Holder’s rights under this Note, and
Makers will remain obligated to pay any further amounts owed or that may become owed to Holder.
All written communications concerning disputed amounts, including any check or other payment
instrument that indicates that the payment constitutes “payment in full” of the amount owed or that
is tendered with other conditions or limitations or as full satisfaction of a disputed amount, must
be mailed or delivered to: Compass Bank, P.O. Box 3096, Birmingham, AL 35202.



     Makers have elected, and hereby elect, to authorize Holder to effect payment of sums due under
this Note by means of debiting the Makers= account with Holder that is identified by account
number 2515967969. The Makers’ authorization to debit such account shall not affect the
Makers’ obligation to pay such sums when due, without notice, if there are insufficient funds
in such account to pay such sums in full on the due date thereof, nor shall Makers be relieved of
any obligation to pay such sums immediately upon demand, if Holder fails to debit such account.



     Prior to an “Event of Default” (as that term is defined in the Commercial Loan Agreement
described below), payment on the Indebtedness shall be credited first to accrued, unpaid interest,
then to principal, if any, that is not secured by the hereinafter-described liens, and the
remainder to the remaining part of the principal, except to the extent provided in the Commercial
Loan Agreement; but after an Event of Default, Holder may credit payment in whatever lawful manner
it chooses. Makers shall have the right to prepay the Indebtedness in full or in part, at any
time, without premium or penalty. Prepayment in full shall consist of payment of the remaining
unpaid principal balance together with all accrued and unpaid interest and all other amounts, costs
and expenses for which Makers are responsible under this Note or any other agreement with Holder
pertaining to this Note before such amounts are due, whether such prepayment arises from a
voluntary or involuntary prepayment, acceleration of maturity, or any other cause or reason.
Prepayment in part shall consist of payment of any portion of the unpaid principal balance before
it is due, whether such prepayment arises from a voluntary or involuntary prepayment, acceleration
of maturity, or any other cause or reason. Unless otherwise agreed by Holder in writing and
provided that Makers are current on all amounts due, payments applied to this Note before Holder’s
creation of a billing statement for the next payment due will be applied entirely to principal, and
payments applied to this Note after the creation of such billing statement will be applied
according to that billing statement. Unless otherwise agreed by Holder in writing and provided that
Makers are current on all amounts due, payments applied to this Note before Holder’s creation of a
billing statement for the next payment due shall not relieve Makers or Makers’ obligation to
continue making, uninterrupted, payments under this Note. Makers agree that all loan fees and other
prepaid charges are earned fully as of the Loan Date and will not be subject to refund, except as
required by law.



     Regardless of any contingency, event, or agreement between Holder and Makers, the interest
contracted for, taken, received, reserved or charged, directly and indirectly, by Holder, in
connection with the transaction of which this Note is a part (the “Loan Transaction”), shall never
exceed the maximum, nonusurious amount Holder may contract for, take, receive, reserve and charge
under applicable law. If Holder receives interest in excess of such nonusurious amount, then
Holder shall



2









 





either refund that excess to Makers or credit that excess, as of the time received, to the
unpaid principal under this Note, at Makers’ option. Holder’s crediting of payments on this Note,
as between interest and principal, shall be provisional until the Indebtedness is fully paid, when
a final and binding crediting shall be made. In addition, the principal required to be paid by
this Note shall not exceed the sum of all advances made by Holder under this Note (including,
without limitation, any advances made and retained by Holder in payment of interest or fees). If
any of the provisions of this Paragraph conflict with any provision(s) in any other paragraph in
this Note, or any provision(s) in any other agreement signed by Makers, the provisions of this
Paragraph shall control and govern the interpretation of this Note and any such other agreement.




     If Makers fail to make timely any payment required by this Note or to perform timely any other
obligation owed to Holder, or if any person breaches any covenant made in any Loan Agreement,
Commercial Security Agreement, Security Agreement or any other security document, that secures
payment of any of the Indebtedness, or in any guaranty agreement by which payment of any of the
Indebtedness is guaranteed, Holder may, to the extent it elects and to the extent provided in the
Commercial Loan Agreement (as defined below), accelerate the maturity of all indebtedness owed by
Makers, or any of them, to Holder. If Holder retains an attorney in connection with any default in
payment of the Indebtedness, or in performance of any covenant or obligation described above, if
Holder brings suit on this Note, or if Makers, or any of them, bring any suit against Holder and do
not prevail, then Makers shall pay to Holder, on demand, the amount of all reasonable attorneys’
and/or collection fees incurred by Holder to the extent provided in the Commercial Loan Agreement.
The portion of that amount that has been demanded by Holder and not paid by Makers as provided in
the Commercial Loan Agreement shall bear interest at the same rate at which interest accrues on
matured, unpaid principal and interest under this Note; and interest accruing pursuant to this
sentence shall be paid to Holder by Makers on demand.



     Each of Makers, each guarantor of any of the Indebtedness, and each person who grants any lien
or security interest to secure payment of any of the Indebtedness, as and to the extent provided in
the Commercial Loan Agreement, (i) waives all notices (including, without limitation, notice of
intent to accelerate, notice of acceleration and notice of dishonor), demands for payment,
presentment, protest and diligence in bringing suit and in the handling of any security; (ii)
agrees to application of any bank balance of Makers, or any of them, to payment of the Indebtedness
before or after maturity; and (iii) agrees that with regard to the Indebtedness, and any other
indebtedness owed by Makers, or any of them, to Holder, none of certain actions by or at the
request of one or more of Makers, whether with or without notice and whether before or after
maturity, shall release or diminish any obligation or liability owed by him, to Holder, such
certain actions being as follows: any and all renewals, extensions, rearrangements, modifications
(including, without limitation, changes in interest rate), partial payments, indulgences of any
kind, releases of any other person(s) obligated to pay any of the Indebtedness, and releases or
substitutions of security, in whole or part.



     In connection with the Loan Transaction, Makers are neither seeking nor obtaining from Holder
anything other than the use of money; and all consideration paid or to be paid by Makers, each of
them, to Holder, including, without limitation, all agreements, contracts and other documents
executed in connection with the Loan Transaction, shall be solely for such use of money. If Holder
provides anything other than the use of money, including any goods and/or services, in connection
with the Loan Transaction, the providing thereof shall be solely at Holder’s option, for
Holder’s



3









 





exclusive benefit and without Holder’s receipt of any consideration therefor. All
agreements, contracts and other documents executed in connection with any indebtedness or
obligations owed by Makers, or any of them, to Holder, including, without limitation, all
agreements, contracts and other documents executed in connection with the Loan Transaction (“Loan
Documents”), shall be subject to, governed by, and construed in accordance with, the laws of the
State of Texas and the United States.




     Makers may borrow, repay and reborrow hereunder at any time, up to a maximum aggregate amount
outstanding at any one time equal to the principal amount of this Note as provided in the
Commercial Loan Agreement, provided that no Default then exists under the Commercial Loan Agreement
of even date herewith between Makers as “Borrower” and Holder as “Lender” (as the same may
hereafter be amended, modified and/or restated, the “Commercial Loan Agreement”), and provided that
the borrowings hereunder do not exceed the Borrowing Base (as defined in the Commercial Loan
Agreement) or other limitation on borrowings by Makers set forth in the Commercial Loan Agreement.
Holder shall incur no liability for its refusal to advance funds based upon its reasonable
determination that any conditions of such further advances have not been met. Holder’s
records of the amounts borrowed from time to time shall be prima fascia evidence thereof. Holder
and Makers expressly agree that Chapter 346 (“Chapter 346”) of the Texas Finance Code shall not
apply to this Note or to any advances under this Note and that neither this Note or any such
advances shall be governed by or subject to the provisions of Chapter 346 in any manner whatsoever.
This Note is subject to the terms of the Commercial Loan Agreement.



     The liens (and/or security interests) that secure payment of the Indebtedness include the
following:



     1. The Note is secured by security interest(s) granted in a Commercial Security Agreement of
even date herewith between Makers as “Owner” and Holder as “Lender” (as the same may hereafter be
amended, modified and/or restated, the “Commercial Security Agreement”) covering personal property
more particularly described therein.



     2. The Note is additionally secured by security interest(s) granted in a Security Agreement
(Patents and Trademarks) of even date herewith between Makers as “Grantor” and Holder as “Lender”
(as the same may hereafter be amended, modified and/or restated, the “Security Agreement”) covering
personal property more particularly described therein.



     3. The Note is additionally secured by all other documents now, hereafter or previously signed
by Makers or any other person to secure the payment of this Note or the performance and discharge
of Makers’ obligations under this Note or the Loan Documents.



     THIS WRITTEN LOAN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.



     THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.



4









 





	 	 	 	 	 
	 	RULES-BASED MEDICINE, INC.,

a Delaware corporation


 	 
	 	By:  	 	 
	 	 	Patrick McClain, Chief Financial Officer 	 
	 	 	 	 
	 





5











 







COMMERCIAL SECURITY AGREEMENT




	 	 	 	 	 	 	 
	LENDER	 	OWNER OF COLLATERAL
	COMPASS BANK	 	RULES-BASED MEDICINE, INC.
	5800 North Mopac	 	 	 	 
	Austin, Texas 78731	 	 	 	 
	 	 	 	 	ADDRESS
	 	 	 	 	3300 Duval Road
	 	 	 	 	Austin, Texas 78759
	 
	 

	 	 	 	TELEPHONE NO.
	 	IDENTIFICATION NO.
	 
	 	 	 	 	 	 
	BORROWER	 	LOCATION OF COLLATERAL
	RULES-BASED MEDICINE, INC.	 	3300 Duval Road	 	 
	 

	 	 	 	Austin, Texas 78759	 	 
	 

	 	 	 	and	 	 
	 	 	 	 	7 Wesvalley Rd., Suite 2
	 	 	 	 	Lake Placid, New York 12946
	ADDRESS	 	 	 	 
	3300 Duval Road	 	 	 	 
	Austin, Texas 78759
	 	 	 	 	 	 
	 
	TELEPHONE NO.

	 	IDENTIFICATION NO.
	 	 	 	 






1. SECURITY INTEREST. Owner of Collateral (Owner) grants to Lender identified
above a continuing security interest in the Collateral described below to secure the obligations
described in this Agreement.




2. OBLIGATIONS. The Collateral shall secure the payment and performance of all of Borrower’s
and Owner’s present and future, joint and/or several, direct and indirect, absolute and
contingent, express and implied, indebtedness (including costs of collection, legal expenses and
attorneys fees, incurred by Lender upon the occurrence of a Default under this Agreement, in
collecting or enforcing payment of such indebtedness, or preserving, protecting or realizing on the
Collateral), liabilities, obligations and covenants (cumulatively Obligations) to
Lender pursuant to:




     a. this Agreement and the following promissory notes and agreements:



	 	 	 	 	 	 	 	 	 	 	 	 	 
	INTEREST	 	PRINCIPAL AMOUNT/	 	FUNDING/	 	MATURITY	 	CUSTOMER	 	LOAN
	RATE	 	CREDIT LIMIT	 	AGREEMENT DATE	 	DATE	 	NUMBER	 	NUMBER
	Wall Street

	 	$	9,000,000.00	 	 	8/___/2009
	 	8/___/2011
	 	 
	 	 
	Journal’s Prime Rate,
	 	 	 	 	 	 	 	 	 	 	 	 
	+ 0.375% floating, per
	 	 	 	 	 	 	 	 	 	 	 	 
	annum, not less than
	 	 	 	 	 	 	 	 	 	 	 	 
	4.0%, per annum.
	 	 	 	 	 	 	 	 	 	 	 	 





Page 1 of 11                      Initials


 









 









	 	b.	 	all other present or future, written or oral, agreements between Borrower or Owner
to Lender (whether executed for the same or different purposes than the preceding
documents); and






	 	c.	 	all amendments, modifications, replacements or substitutions to any of the
foregoing.





3. COLLATERAL. The Collateral shall consist of all of the following-described property and
Owner=s rights, title and interest in such property whether now owned or hereafter acquired
by Owner and wheresoever located:





	 	•	 	 All accounts and contract rights including, but not limited to, the accounts
and contract rights described on Schedule A attached hereto and incorporated herein by
this reference;






	 	•	 	All chattel paper including, but not limited to, the documents described on
Schedule A attached hereto and incorporated herein by this reference;






	 	•	 	All documents including, but not limited to, the documents described on
Schedule A attached hereto and incorporated herein by this reference;






	 	•	 	All equipment, including, but not limited to, the equipment described on
Schedule A attached hereto and incorporated herein by this reference;






	 	•	 	All fixtures, including, but not limited to, the fixtures located or to be
located on the real property described on Schedule B attached hereto and incorporated
herein by this reference;






	 	•	 	All general intangibles, including, but not limited to, the general intangibles
described on Schedule A attached hereto and incorporated herein by this reference;






	 	•	 	All instruments including, but not limited to, the instruments described on
Schedule A attached hereto and incorporated herein by this reference;






	 	•	 	All inventory including, but not limited to, the inventory described on
Schedule A attached hereto and incorporated herein by this reference;






	 	•	 	All minerals or the like located on or related to the real property described
on Schedule B attached hereto and incorporated herein by this reference;






	 	•	 	All standing timber located on the real property described on Schedule D
attached hereto and incorporated herein by this reference;






	 	•	 	Other:





All monies, instruments and savings, checking
or other deposit accounts within Lender’s
custody or control (excluding IRA, Keogh, trust accounts, and deposits subject to tax penalties if
so assigned);




Page 2 of 11                      Initials




 









 








All accessions, accessories, additions, amendments, attachments, modifications, replacements and
substitutions to any of the above;

All proceeds and products of any of the above;

All policies of insurance pertaining to any of the above as well as any proceeds and unearned
premiums pertaining to such policies; and

All books and records pertaining to any of the above.




4. OWNER=S TAXPAYER IDENTIFICATION. Owner’s federal taxpayer identification number is:
22-3860791.




5. RESIDENCY/LEGAL STATUS. Owner is a corporation, duly organized and validly existing under the
laws of the State of Delaware.




6. REPRESENTATIONS, WARRANTIES, AND COVENANTS. Owner represents, warrants and covenants to Lender
that:





	 	(a)	 	Owner is and shall remain the sole owner of the Collateral free of all tax and
other liens, security interests, encumbrances and claims of any kind except as
specifically permitted by this Agreement and the Loan Documents and except for
dispositions specifically permitted by this Agreement and the Loan Documents;






	 	(b)	 	Neither Owner nor, to the best of Owner=s knowledge, any other party has
used, generated, released, discharged, stored, or disposed of any Hazardous Materials
as defined in the Commercial Loan Agreement of even date herewith between Owner and
Lender (“Loan Agreement”) or transported any Hazardous Materials across any property
owned or leased by Owner under Owner’s control. Owner shall not commit or permit such
actions to be taken in the future;






	 	(c)	 	Owner’s chief executive office, chief place of business, office where its
business records are located, or residence is the address identified above.
Owner’s other executive offices, places of business, locations of its business
records, or domiciles are described on Schedule C attached hereto and incorporated
herein by this reference. Owner shall immediately advise Lender in writing of any
change in or addition to the foregoing addresses;






	 	(d)	 	Owner shall not become a party to any restructuring of its form of business or
participate in any consolidation, merger, liquidation or dissolution without obtaining
Lender’s prior written consent thereto, which will not be unreasonably withheld,
delayed or conditioned;






	 	(e)	 	Owner shall notify Lender of the nature of any intended change of Owner=s
name, or the use of any trade name, and the effective date of such change;






	 	(f)	 	The Collateral is and shall at all times remain free of all tax and other
liens, security interests, encumbrances and claims of any kind except for those
belonging to Lender, those described on Schedule D attached hereto and incorporated
herein by this reference and any Permitted Liens. Without waiving the event of default
as a result thereof, Owner shall take any action and execute any document needed to
discharge the foregoing liens, security interests, encumbrances and claims prohibited
hereunder;





Page 3 of 11                      Initials


 









 








	 	(g)	 	Owner shall defend the Collateral against all claims and demands of all persons
at any time claiming any interest therein except for those belonging to Lender, those
described on Schedule D and any Permitted Liens;







	 	(h)	 	All of the goods, fixtures, minerals or the like, and standing timber
constituting the Collateral is and shall be located at Owner’s executive offices,
places of business, residence and domiciles specifically described in this Agreement
unless written notice of another location is given to Lender within ten (10) days of
any relocation;






	 	(i)	 	Owner shall provide Lender with possession of all chattel paper and instruments
constituting the Collateral;






	 	(j)	 	To the best of Owner’s knowledge, all of Owner’s accounts or contract
rights; chattel paper; documents; general intangibles; instruments; and federal, state,
county, and municipal government and other permits and licenses; trusts, liens,
contracts, leases, and agreements constituting the Collateral are and shall be valid,
genuine and legally enforceable obligations and rights belonging to Owner against one
or more third parties and not subject to any valid claim, defense, setoff or
counterclaim of any kind, provided that, if the same shall be subject to an assertion
by a third party of any valid claim, defense, setoff or counterclaim of any kind, it
will be excluded from the Borrowing Base hereunder, to the extent of the amount in
dispute and to the extent provided in the Borrowing Base Agreement and provided
further, that the occurrence of such an assertion, in of itself, shall not be a
Default;






	 	(k)	 	Owner shall not amend, modify, replace or substitute any account or contract
right; chattel paper; document; general intangible; or instrument constituting the
Collateral which is outside the ordinary course of Owner’s business and materially and
adversely affects the Collateral without the prior written consent of Lender;






	 	(l)	 	Owner has the right and is duly authorized to enter into and perform its
obligations under this Agreement. Owner=s execution and performance of these
obligations do not and shall not conflict with the provisions of any statute,
regulation, ordinance, rule of law, contract or other agreement which may now or
hereafter be binding on Owner;






	 	(m)	 	No action or proceeding is pending against Owner which could reasonably be
expected to result in a material and adverse change in Borrower’s business operations
or financial condition, taken as a whole, or materially affect the Collateral;






	 	(n)	 	Owner has not violated and shall not violate any applicable federal, state,
county or municipal statute, regulation or ordinance (including, but not limited to,
those governing Hazardous Materials) which may materially and adversely affect its
business operations or financial condition, taken as a whole, or the Collateral; and






	 	(o)	 	This Agreement and the obligations described in this Agreement are executed and
incurred for business and not consumer purposes.





7. SALE OF COLLATERAL. Owner shall not assign, convey, lease, sell or transfer any of the
Collateral to any third party without the prior written consent of Lender, except for sales of
inventory to buyers in the ordinary course of business and other assignments, conveyances, sales
and transfers permitted under the Commercial Loan Agreement. Lender will promptly provide Borrower
upon Borrower’s request with partial releases and UCC terminations with respect to any assets or
properties subject to any assignments, conveyances, sales and transfers permitted under the
Commercial Loan Agreement.




Page 4 of 11                      Initials





 









 








8. FINANCING STATEMENTS AND OTHER DOCUMENTS. Owner shall take all actions and execute all
documents required by Lender to attach, perfect and maintain its security interest in the
Collateral and establish and maintain its right to receive the payment of the proceeds of the
Collateral including, but not limited to, executing any financing statements, fixture filings,
continuation statements, notices of security interest, and other documents required by the Uniform
Commercial Code and other applicable law. Owner shall pay the costs of filing such documents in
all offices wherever filing or recording is deemed by Lender to be necessary or desirable as
provided in paragraph 11 of the Loan Agreement. In lieu of filing security agreements, financing
statements, and effective financing statements, Lender shall be entitled to perfect its security
interest in the Collateral by filing carbon, photographic or other reproductions of the
aforementioned documents with any authority required by the Uniform Commercial Code or other
applicable law.




9. INQUIRIES AND NOTIFICATION TO THIRD PARTIES. Owner hereby authorizes Lender, upon five (5) days
written notice to Owner, to contact any third party and make any inquiry pertaining to
Owner’s financial condition or the Collateral. In addition, Lender is authorized to provide
oral or written notice of its security interest in the Collateral to any third party.




10. COLLECTION OF INDEBTEDNESS FROM THIRD PARTIES. Lender shall be entitled to notify, and upon
the request of Lender, Owner shall notify any account debtor or other third party (including, but
not limited to, insurance companies) to pay any indebtedness or obligation owing to Owner and
constituting the Collateral (cumulatively Indebtedness) to Lender whether or not a
Default exists under this Agreement. Owner shall diligently collect the Indebtedness owing to
Owner from its account debtors and other third parties until the giving of such notification. In
the event that Owner possesses or receives possession of any instruments or other remittances with
respect to the Indebtedness following the giving of such notification or if the instruments or
other remittances constitute the prepayment of any Indebtedness or the payment of any insurance
proceeds, Owner shall hold such instruments and other remittances in trust for Lender apart from
its other property, endorse the instruments and other remittances to Lender, and immediately
provide Lender with possession of the instruments and other remittances. Lender shall be entitled,
but not required, to collect (by legal proceedings or otherwise), extend the time for payment,
compromise, exchange or release any obligor or collateral upon, or otherwise settle any of the
Indebtedness whether or not an event of default exists under this Agreement. Lender shall not be
liable to Owner for any action, error, mistake, omission or delay pertaining to the actions
described in this paragraph or any damages resulting therefrom.




11. POWER OF ATTORNEY. Owner hereby appoints Lender as its attorney-in-fact to endorse
Owner=s name on all instruments and other remittances payable to Owner with respect to the
Indebtedness or other documents pertaining to Lender’s actions in connection with the
Indebtedness. Unless an Event of Default has occurred and is continuing, any funds received on
account of the endorsement of checks payable to the Owner shall be deposited in the bank account of
the Owner. In addition, Lender shall be entitled, but not required, to perform any action or
execute any document required to be taken or executed by Owner under this Agreement, including, but
not limited to, executing and filing any financing statements, fixture filings, continuation
statements, notices of security interest and other documents required by the Uniform Commercial
Code and other applicable law. Lender’s performance of such action or execution of such
documents shall not




Page 5 of 11                      Initials





 











 




relieve Owner from any obligation to cure any default under this Agreement. The powers of attorney
described in this paragraph are coupled with an interest and are irrevocable.



12. USE AND MAINTENANCE OF COLLATERAL. Owner shall use the Collateral solely in the ordinary
course of its businesses, for the usual purposes intended by the manufacturer (if applicable), with
due care, and in compliance in all material respects with the laws, ordinances, regulations,
requirements and rules of all federal, state, county and municipal authorities including
environmental laws and regulations and insurance policies. Owner shall not make any alterations,
additions or improvements to the Collateral without the prior written consent of Lender which is
outside the ordinary course of Owner’s business and materially and adversely affects the
Collateral. Without limiting the foregoing, all alterations, additions and improvements made to
the Collateral shall be subject to the security interest belonging to Lender, shall not be removed
if such removal might result in a material adverse effect on the Owner, or the Collateral, without
the prior written consent of Lender, and shall be made at Owner’s sole expense. Owner shall
take all reasonable actions and make any repairs or replacements needed to maintain the Collateral
in good condition and working order.



13. LOSS OR DAMAGE. Owner shall bear the entire risk of any loss, theft, destruction or damage
(cumulatively Loss or Damage) to all or any part of the Collateral. In the event of
any Loss or Damage in excess of $250,000.00, net of insurance proceeds, Owner will either restore
the Collateral to its previous condition, replace the Collateral with similar property acceptable
to Lender in its sole discretion, or pay or cause to be paid to Lender the decrease in the fair
market value of the affected Collateral to be applied to reduce the amount outstanding under the
Obligations.



14. INSURANCE. Owner shall maintain and cause to be maintained insurance with responsible
insurance companies on such of its properties, in such amounts and against such risks as is
described in the Agreement to Provide Insurance. OWNER MAY FURNISH REQUIRED INSURANCE EITHER
THROUGH EXISTING POLICIES OWNED OR CONTROLLED BY OWNER OR THROUGH ANY INSURANCE COMPANY AUTHORIZED
TO TRANSACT BUSINESS IN TEXAS, BUT LENDER MAY REFUSE ANY INSURER FOR REASONABLE CAUSE. The
insurance policies shall require the insurance company to provide Lender with at thirty (30)
days= written notice before such policies are altered or canceled in any manner. The
insurance policies shall name Lender as a loss payee and provide that no act or omission of Owner
or any other person shall affect the right of Lender to be paid the insurance proceeds pertaining
to the loss or damage of the Collateral. In the event Owner fails to acquire or maintain
insurance, Lender (after providing notice as may be required by law) may in its discretion procure
appropriate insurance coverage upon the Collateral and charge the insurance cost as an advance of
principal under the promissory note. Owner shall furnish Lender with evidence of insurance
indicating the required coverage. Lender may act as attorney-in-fact for Owner in making and
settling claims under insurance policies, canceling any policy or endorsing Owner’s name on
any draft or negotiable instrument drawn by any insurer.



15. INDEMNIFICATION. Lender shall not assume or be responsible for the performance of any of
Owner’s obligations with respect to the Collateral under any circumstances. Owner shall
immediately provide Lender with written notice of and indemnify and hold Lender and its
shareholders, directors, officers, employees and agents harmless from all claims, damages,
liabilities




Page 6 of 11                      Initials





 









 







(including attorneys’ fees and legal expenses), causes of action, actions, suits and
other legal proceedings (cumulatively Claims) pertaining to its business operations
or the Collateral including, but not limited to, those arising from Lender’s performance of
Owner’s obligations with respect to the Collateral except to the extent such Claims are
attributable to the gross negligence or willful misconduct on the part of Lender. It is the
express intention of the parties hereto that the indemnity provided for herein is intended to and
shall indemnify and protect Lender from the consequences of Lender’s own negligence, whether
or not that negligence is the sole or concurring cause of any claim, damage, liability, loss,
deficiency, penalty, cost or expense. Owner, upon the request of Lender, shall hire legal counsel
to defend Lender from such Claims, and pay the attorneys’ fees, legal expenses and other
costs incurred in connection therewith. . If Owner fails to perform its obligations under this
paragraph, Lender shall be entitled to employ its own legal counsel to defend such Claims at
Owner’s cost.



16. TAXES AND ASSESSMENTS. Owner shall execute and file all tax returns and pay all taxes,
licenses, fees and assessments relating to its business operations and the Collateral (including,
but not limited to, income taxes, personal property taxes, withholding taxes, sales taxes, use
taxes, excise taxes and workers’ compensation premiums) in a timely manner.



17. INSPECTION OF COLLATERAL AND BOOKS AND RECORDS. Owner shall allow Lender or its agents to
examine, inspect and make abstracts and copies of the Collateral and Owner’s books and
records pertaining to Owner’s business operations and financial condition or the Collateral
during normal business hours subject to and in accordance with the provisions of the Loan
Agreement. Owner shall provide any assistance required by Lender for these purposes. All of the
signatures and information pertaining to the Collateral or contained in the books and records shall
be genuine, true, accurate and complete in all respects. Owner shall note the existence of
Lender’s security interest in its books and records pertaining to the Collateral.



18. The terms “Default” and “Event of Default” shall have the meanings assigned to such terms in
the Loan Agreement.



19. RIGHTS OF LENDER ON AN EVENTOF DEFAULT. If there is an Event of Default under this Agreement
or the Loan Agreement, Lender shall be entitled to exercise one or more of the following remedies
without notice or demand (except as required by law) while such Event of Default is continuing:





	 	(a)	 	to declare the Obligations immediately due and payable in full;
	 
	 	(b)	 	to collect the outstanding Obligations with or without resorting to judicial
process;
	 
	 	(c)	 	to change Owner’s mailing address, open Owner’s mail, and retain
any instruments or other remittances constituting the Collateral contained therein;
	 
	 	(d)	 	to lawfully and peaceably take possession of any Collateral in any manner
permitted by law;
	 
	 	(e)	 	to apply for and obtain, without notice and upon ex parte application, the
appointment of a receiver for the Collateral without regard to Owner’s financial
condition or solvency, the adequacy of the Collateral to secure the payment or
performance of the obligations, or the existence of any waste to the Collateral;
	 
	 	(f)	 	to require Owner to deliver and make available to Lender any Collateral at a
place reasonably convenient to Owner and Lender;





Page 7 of 11                      Initials








 









 









	 	(g)	 	to sell, lease or otherwise dispose of any Collateral and collect any deficiency
balance with or without resorting to legal process subject to and in accordance with
the Uniform Commercial Code;
	 
	 	(h)	 	to setoff Owner’s obligations against any amounts due to Owner including,
but not limited to, monies, instruments, and deposit accounts maintained with Lender;
and
	 
	 	(i)	 	to exercise all other rights available to Lender under any other written
agreement or applicable law.




Lender’s rights are cumulative and may be exercised together, separately, and in any order.
If notice to Owner of intended disposition of Collateral is required by law, Lender will provide
reasonable notification of the time and place of any sale or intended disposition as required under
the Uniform Commercial Code. In the event that Lender institutes an action to recover any
Collateral or seeks recovery of any of the Collateral by way of a prejudgment remedy in an action
against Owner, Owner hereby waives the posting of any bond which might otherwise be required.
Owner waives and consents to any release or other impairment of any Collateral because of any
failure of Lender to perfect its security interest, any damage to the Collateral, or any other
reason whatsoever, even if caused by Lender’s negligence.



20. APPLICATION OF PAYMENTS. Upon Default, all payments made by or on behalf of Owner and all
credits due to Owner from the disposition of the Collateral or otherwise may be applied against the
amounts paid by Lender (including attorneys’ fees and legal expenses) in connection with the
exercise of its rights or remedies described in this Agreement and any interest thereon and then to
the payment of the remaining Obligations in whatever order Lender chooses.



21. REIMBURSEMENT OF AMOUNTS EXPENDED BY LENDER. Owner shall reimburse Lender for all amounts
(including attorneys= fees and legal expenses) expended by Lender in the performance of any
action required to be taken by Owner or the exercise of any right or remedy belonging to Lender
under this Agreement, together with interest thereon at the lower of the highest rate described in
any promissory note or credit agreement executed by Borrower or Owner or the highest rate allowed
by law from the date of payment until the date of reimbursement. These sums shall be included in
the definition of Obligations, shall be secured by the Collateral identified in this Agreement and
shall be payable upon demand.



22. ASSIGNMENT. Owner shall not be entitled to assign any of its rights, remedies or obligations
described in this Agreement without the prior written consent of Lender. Consent may
be withheld by Lender in its sole discretion. Upon notice to Borrower, Lender shall be entitled to
assign some or all of its rights and remedies described in this Agreement to any federally insured
financial institution without the prior consent of Owner in any manner. Except as provided in the
preceding sentence, Lender shall not be entitled to assign any of its rights, remedies or
obligations described in this Agreement or the Loan Documents without the prior written consent of
Owner, which will not be unreasonably withheld, delayed or conditioned.



23. MODIFICATION AND WAIVER. The modification or waiver of any of Owner’s Obligations or
Lender’s rights under this Agreement must be contained in a writing signed by Lender and
Borrower. Lender may perform any of Owner’s Obligations or delay or fail to exercise any of
its rights without causing a waiver of those Obligations or rights. A waiver on one occasion




Page 8 of 11                      Initials






 









 







shall not constitute a waiver on any other occasion. Owner’s Obligations under this Agreement
shall not be affected if Lender amends, compromises, exchanges, fails to exercise, impairs or
releases any of the obligations belonging to any Owner or third party or any of its rights against
any Owner, third party or collateral.



24. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and inure to the benefit of Owner
and Lender and their respective successors, assigns, trustees, receivers, administrators, personal
representatives, legatees and devisees subject to the provisions of this Agreement and the Loan
Agreement.



25. NOTICES. Any notice or other communication under this Agreement shall be in writing and sent
to the parties at the addresses described in this Agreement or such other address as the parties
may designate in writing from time to time.



26. SEVERABILITY. If any provision of this Agreement violates the law or is unenforceable, the
rest of the Agreement shall remain valid.



27. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF TEXAS AND
APPLICABLE FEDERAL LAW. OWNER OF COLLATERAL CONSENTS TO THE JURISDICTION AND VENUE OF ANY COURT
LOCATED IN THE COUNTY IN WHICH THIS AGREEMENT IS SIGNED OR IN WHICH OWNER OF COLLATERAL RESIDES IN
THE EVENT OF ANY LEGAL PROCEEDING UNDER THIS AGREEMENT.



28. ATTORNEYS FEES. If any action at law or in equity is necessary to enforce or interpret the
terms of this Agreement, the prevailing party shall be entitled to reasonable attorneys’ fees,
costs and necessary disbursements in addition to any other relief to which such party may be
entitled.



29. MISCELLANEOUS. This Agreement is executed for commercial purposes. Owner shall supply
information regarding Owner=s business operations and financial condition or the Collateral
in the form and manner as requested by Lender. All information furnished by Owner to Lender shall
be true, accurate and complete in all respects. Owner and Lender agree that time is of the
essence. Owner waives presentment, demand for payment, notice of intent to accelerate, notice of
acceleration, notice of dishonor and protest except as required by law and the Loan Documents. All
references to Owner in this Agreement shall include all parties signing below. If there is more
than one Owner, their obligations shall be joint and several. This Agreement shall remain in full
force and effect until Lender provides Owner with written notice of termination. This Agreement
and any related documents represent the complete and integrated understanding between Owner and
Lender pertaining to the terms and conditions of those documents. Capitalized terms not otherwise
defined herein shall have the same meanings assigned to such terms in the Loan Agreement. If the
terms of the Loan Agreement conflicts with the terms of this Agreement, the terms of the Loan
Agreement shall control.




Page 9 of 11                      Initials






 









 







30. ADDITIONAL TERMS. None.



Owner acknowledges that Owner has read, understands and agrees to the terms and conditions of this
Agreement. This Agreement and related documents have been signed in the county of Lender’s
address unless otherwise specified:



THIS WRITTEN LOAN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.



Dated: August ___, 2009.




	 	 	 	 	 
	 	LENDER:

COMPASS BANK

 	 
	 
	 	By:  	 	 
	 	 	Todd Jordan, Senior Vice President 	 
	 	 	 	 
	 
	 	OWNER:

RULES-BASED MEDICINE, INC.,

a Delaware corporation

 	 
	 
	 	By:  	 	 
	 	 	Patrick McClain, Chief Financial Officer 	 
	 	 	 	 
	 



Page 10 of 11                      Initials





 









 








SCHEDULE A





     All of the Owner’s accounts receivable, inventory, equipment and general
intangibles, now owned or hereafter acquired.



SCHEDULE B




SCHEDULE C




SCHEDULE D




     The lien(s) securing payment of note(s) existing prior to the date hereof, as renewed,
extended, reamortized, or otherwise adjusted periodically, executed by Owner, payable to the order
of Stillwater National Bank and Trust Company and Dell Financial Services L.L.C. or their
successors and assigns.




Page 11 of 11                      Initials





 












 








SECURITY AGREEMENT

(Patents and Trademarks)




     THIS SECURITY AGREEMENT (as it may be amended or modified from time to time, the “Security
Agreement”) is entered into as of August ___, 2009 by and between RULES-BASED MEDICINE, INC.,
a Delaware corporation, whose address is 3300 Duval Road, Austin, Texas 78759 (the
“Grantor”), and COMPASS BANK, whose address is 5800 North Mopac, Austin, Texas 78731 (the
“Lender”).



PRELIMINARY STATEMENT




     The Grantor and the Lender are entering into a Commercial Loan Agreement of even date herewith
(as it may be amended, modified and/or restated from time to time, the “Loan Agreement”).
The Grantor is entering into this Security Agreement in order to induce the Lender to enter into
and extend credit to the Grantor under the terms of the Loan Agreement.



     ACCORDINGLY, the Grantor and the Lender, hereby agree as follows:



ARTICLE I

DEFINITIONS




     1.1. Terms Defined in Loan Agreement. All capitalized terms used herein and not
otherwise defined shall have the meanings assigned to such terms in the Loan Agreement.



     1.2. Terms Defined in UCC. Terms defined in the UCC which are not otherwise defined
in this Security Agreement are used herein as defined in the UCC.



     1.3. Definitions of Certain Terms Used Herein. As used in this Security Agreement, in
addition to the terms defined in the Preliminary Statement, the following terms shall have the
following meanings:



     “Article” means a numbered article of this Security Agreement, unless another document
is specifically referenced.



     “Closing Date” means the date of the Loan Agreement.



     “Collateral” shall have the meaning set forth in Article II.



     “Default” shall have the meaning assigned to such term in the Loan Agreement.



     “Event of Default” shall have the meaning assigned to such term in the Loan Agreement.



     “Exhibit” refers to a specific exhibit to this Security Agreement, unless another
document is specifically referenced.



     “General Intangibles” shall have the meaning set forth in Article 9 of the UCC.



     “Licenses” means, with respect to any Person, all of such Person’s right, title, and
interest in and to (a) any and all licensing agreements or similar arrangements, whether as
licensee or licensor, in and to any of its Patents or Trademarks, (b) all income, royalties,
damages, claims, and payments now or hereafter due or payable under and with respect thereto,
including, without limitation, damages and payments for past and future breaches thereof, and (c)
all rights to sue for past, present, and future breaches thereof.



 









 





     “Patents” means, with respect to any Person, all of such Person’s right, title, and
interest in and to: (a) any and all patents and patent applications, including, but not limited to
the patents and patent applications identified in Exhibit “A” attached hereto and made a
part hereof; (b) all inventions and improvements described and claimed therein; (c) all reissues,
divisions, continuations, renewals, extensions, and continuations-in-part thereof; (d) all income,
royalties, damages, claims, and payments now or hereafter due or payable under and with respect
thereto, including, without limitation, damages and payments for past and future infringements
thereof; (e) all rights to sue for past, present, and future infringements thereof; and (f) all
rights corresponding to any of the foregoing throughout the world.



     “Section” means a numbered section of this Security Agreement, unless another document
is specifically referenced.



     “Secured Obligations” means all indebtedness, obligations and liabilities of the
Grantor to Lender of any kind or character, now existing or hereafter arising, whether direct,
indirect, related, unrelated, fixed, contingent, liquidated, unliquidated, joint, several or joint
and several, and regardless of whether such indebtedness, obligations and liabilities may, prior to
their acquisitions by the Lender, be or have been payable to or in favor of a third party and
subsequently acquired by the Lender (it being contemplated that the Lender may make such
acquisitions from third parties), including without limitation, all indebtedness owing by the
Grantor to the Lender now existing or hereafter arising under or pursuant to the Loan Agreement and
that one certain Promissory Note of even date herewith, in the original principal amount of
$9,000,000.00, executed by the Grantor, payable to the order of the Lender, and all indebtedness,
obligations and liabilities of Borrower to Lender now existing or hereafter arising by note, draft,
acceptance, guaranty, endorsement, letter of credit, assignment, purchase, overdraft, discount,
indemnity agreement or otherwise.



     “Trademarks” means, with respect to any Person, all of such Person’s right, title, and
interest in and to the following: (a) all trademarks (including service marks), trade names, trade
dress, and trade styles and the registrations and applications for registration thereof, including,
but not limited to the trademarks (including service marks), trade names, trade dress, and trade
styles and the registrations and applications for registration thereof identified in Exhibit
“B” attached hereto and made a part hereof, and the goodwill of the business symbolized by the
foregoing; (b) all renewals of the foregoing; (c) all income, royalties, damages, and payments now
or hereafter due or payable with respect thereto, including, without limitation, damages, claims,
and payments for past and future infringements thereof; (d) all rights to sue for past, present,
and future infringements of the foregoing, including the right to settle suits involving claims and
demands for royalties owing; and (e) all rights corresponding to any of the foregoing throughout
the world.



     “UCC” means the Uniform Commercial Code, as in effect from time to time, of the State
of Texas or of any other state the laws of which are required as a result thereof to be applied in
connection with the attachment, perfection or priority of, or remedies with respect to, Lender’s
Lien on any Collateral.



     The foregoing definitions shall be equally applicable to both the singular and plural forms of
the defined terms.



ARTICLE II

GRANT OF SECURITY INTEREST




     In order to secure the prompt and complete payment and performance of the Secured Obligations,
the Grantor hereby pledges, assigns and grants to the Lender, a security interest in all of its
right, title and interest in, to and under the following described collateral, whether now owned
by, or hereafter acquired by or arising in favor of the Grantor (all of which will be collectively
referred to as the “Collateral”):



2









 






	 	(a)	 	all Patents and Trademarks;
	 
	 	(b)	 	all Licenses at any time relating to any of the foregoing;
	 
	 	(c)	 	all General Intangibles at any time evidencing or relating to any of the
foregoing, together with all books and records, computer files, programs, printouts
and other computer materials and records related thereto; and
	 
	 	(d)	 	all proceeds and products of any of the foregoing.





ARTICLE III

REPRESENTATIONS AND WARRANTIES




     The Grantor represents and warrants to the Lender that:



     3.1. Title, Perfection and Priority. The Grantor has good and valid rights in or the
power to transfer the Collateral and title to the Collateral with respect to which it has purported
to grant a security interest hereunder, free and clear of all liens, security interests and other
encumbrances, except as specifically noted otherwise in the Loan Documents, and has full power and
authority to grant to the Lender the security interest in such Collateral pursuant hereto. As
provided in the Loan Agreement, until the occurrence of a Default, Lender shall not perfect the
security interest and/or record the collateral assignment in the Collateral described in this
Agreement. Once a Default has occurred and is continuing, Lender shall have the option to take
whatever steps are necessary to perfect the security interest and/or record the collateral
assignment in the Collateral and exercise any and all rights or remedies that Lender may have under
this Agreement or the Loan Documents.



     3.2. Exact Names. The Grantor’s name in which it has executed this Security Agreement
is the exact name as it appears in (a) the Grantor’s organizational documents, as amended, as filed
with the Grantor’s jurisdiction of organization, and (b) the records of the United States Patent
and Trademark Office related to the Collateral. The Grantor has not, during the past five years,
been known by or used any other corporate or fictitious name, or been a party to any merger or
consolidation, or been a party to any acquisition.



     3.3. Intellectual Property. The Grantor does not have any interest in, or title to,
any Patent or Trademark recorded in the United States Patent and Trademark Office except as set
forth in Exhibits A and B. This Security Agreement is effective to create a valid
and continuing security interest and, upon filing of an appropriate financing statement with the
Secretary of State of the State of Delaware and this Security Agreement (or an abbreviated form of
this Security Agreement) with the United States Patent and Trademark Office, fully perfected first
priority security interests in favor of the Lender on the Grantor’s Patents and Trademarks, such
perfected security interests are enforceable as such as against any and all creditors of and
purchasers from the Grantor; and all action necessary or desirable to protect and perfect the
Lender’s Lien on the Grantor’s Patents and Trademarks shall have been duly taken.



     3.4. No Financing Statements, Security Agreements. No financing statement or security
agreement describing all or any portion of the Collateral which has not lapsed or been terminated
naming the Grantor as debtor has been filed or is of record in any jurisdiction.



3









 





ARTICLE IV

COVENANTS




     From the date of this Security Agreement, and thereafter until this Security Agreement is
terminated, the Grantor agrees that, except as otherwise provided in the Loan Agreement:



     4.1. General.



          (a) Collateral Records. The Grantor will maintain complete and accurate
books and records with respect to the Collateral, and furnish to the Lender, such reports relating
to the Collateral as the Lender shall from time to time reasonably request.




          (b) Authorization to File Financing Statements; Ratification. Upon the
occurrence of a Default under the Loan Agreement or any of the other Loan Documents, the Grantor
hereby authorizes the Lender to file, and if requested will deliver to the Lender, all financing
statements and other documents and take such other actions as may from time to time be requested by
the Lender in order to maintain a first perfected security interest in the Collateral.




          (c) Further Assurances. The Grantor will, if so requested by the Lender,
furnish to the Lender, as often as the Lender reasonably requests, statements and schedules further
identifying and describing the Collateral and such other reports and information in connection with
the Collateral as the Lender may reasonably request, all in such detail as the Lender may
reasonably specify. The Grantor also agrees to take any and all actions, including, the execution
and delivery of any additional documents and instruments reasonably requested by Lender, necessary
to defend title to the Collateral against all persons and to defend the security interest of the
Lender in the Collateral and the priority thereof against any lien, security interest or
encumbrance not expressly permitted hereunder.




          (d) Disposition of Collateral. The Grantor will not sell, lease or
otherwise dispose of the Collateral, except as otherwise provided in the Loan Agreement, provided
that nothing herein shall prohibit or restrict Grantor from granting licenses with respect to the
Collateral.




          (e) Liens. The Grantor will not create, incur, or suffer to exist any
liens, security interests or other encumbrances on the Collateral except the security interest
created by this Security Agreement.




          (f) Other Financing Statements. The Grantor will not authorize the filing
of any financing statement (other than in favor of the Lender) naming it as debtor covering all or
any portion of the Collateral. The Grantor acknowledges that it is not authorized to file any
financing statement or amendment or termination statement with respect to any financing statement
filed by the Lender in accordance with the terms hereof without the prior written consent of the
Lender, subject to the Grantor’s rights under Section 9-509(d)(2) of the UCC.




          (g) Compliance with Terms. The Grantor will perform and comply with all
obligations in respect of the Collateral and all agreements to which it is a party or by which it
is bound relating to the Collateral.





	    4.2.	 	Intellectual Property.





          (a) The Grantor will use its best efforts to secure all consents and approvals necessary or
appropriate for the assignment to or for benefit of the Lender of any License held by the Grantor
and to enforce the security interests granted hereunder.






4









 








          (b) The Grantor shall notify the Lender immediately if it knows or has reason to know that any
application or registration relating to any Patent or Trademark (now or hereafter existing) may
become abandoned or dedicated, or of any adverse determination or development (including the
institution of, or any such determination or development in, any proceeding in the United States
Patent and Trademark Office or any court) regarding the Grantor’s ownership of any Patent or
Trademark, its right to register the same, or to keep and maintain the same.




          (c) In no event shall the Grantor, either directly or through any agent, employee, licensee or
designee, file an application for the registration of any Patent or Trademark with the United
States Patent and Trademark Office or any similar office or agency without giving the Lender prior
written notice thereof, and, upon request of the Lender, the Grantor shall execute and deliver any
and all security agreements as the Lender may request to evidence the Lender’s first priority
security interest on such Patent or Trademark, and the General Intangibles of the Grantor relating
thereto or represented thereby.




          (d) The Grantor shall use commercially reasonable efforts to maintain and pursue each
application, to obtain the relevant registration and to maintain the registration of each of the
Patents and Trademarks (now or hereafter existing), including the filing of applications for
renewal, affidavits of use, affidavits of noncontestability and opposition and interference and
cancellation proceedings, unless the Grantor shall reasonably determine that such Patent or
Trademark is not material to the conduct of Grantor’s business.




          (e) The Grantor shall, unless it shall reasonably determine that such Patent or Trademark is
in no way material to or necessary for the conduct of its business or operations, take all
commercially reasonable actions to protect such Patent or Trademark from infringement,
misappropriation or dilution and to recover any and all damages for such infringement,
misappropriation or dilution, and shall take such other actions as the Lender shall reasonably deem
appropriate under the circumstances to protect such Patent or Trademark. In the event that the
Grantor institutes suit because any of the Patents or Trademarks constituting Collateral is
infringed upon, or misappropriated or diluted by a third party, the Grantor shall comply with
Section 4.3.




     4.3 Commercial Tort Claims. The Grantor shall promptly, and in any event within two
Business Days after the same is acquired by it, notify the Lender of any commercial tort claim (as
defined in the UCC) acquired by it relating to any of the Collateral and, unless the Lender
otherwise consents, the Grantor shall enter into an amendment to this Security Agreement, in a form
reasonably required by the Lender, granting to the Lender a first priority security interest in
such commercial tort claim.



     4.4. No Interference. The Grantor agrees that it will not interfere with any right,
power and remedy of the Lender provided for in this Security Agreement or now or hereafter existing
at law or in equity or by statute or otherwise, or the exercise or beginning of the exercise by the
Lender of any one or more of such rights, powers or remedies.



     4.5. Change of Name or Location. The Grantor shall not (a) change its name as it
appears in official filings in the state of its incorporation or organization or as it appears in
official filings with the United States Patent and Trademark Office, (b) change the type of entity
that it is, (c) change its organization identification number, if any, issued by its state of
incorporation or other organization, or (f) change its state of incorporation or organization, in
each case, unless the Lender shall have received at least thirty days prior written notice of such
change and the Lender shall have acknowledged in writing that either (1) such change will not
adversely affect the validity, perfection or priority of the Lender’s security interest in the
Collateral, or (2) any reasonable action requested by the Lender in connection therewith has been
completed or taken (including any action to continue the perfection of any Liens in favor of the
Lender in any Collateral), provided that, any new location shall be in the continental U.S.



5









 





ARTICLE V

EVENTS OF DEFAULT AND REMEDIES




     5.1. Events of Default. The terms “Default” and “Event of Default” shall have the
meanings assigned to such terms in the Loan Agreement.



     5.2. Remedies.



          (a) Upon the occurrence of an Event of Default, the Lender may exercise any or all of the
following rights and remedies while such Event of Default is continuing:





          (i) those rights and remedies provided in this Security Agreement, the Loan
Agreement, or any other Loan Document; provided that, this Section 5.2(a) shall not be
understood to limit any rights or remedies available to the Lender prior to an Event of
Default;




          (ii) those rights and remedies available to a secured party under the UCC
(whether or not the UCC applies to the affected Collateral) or under any other applicable
law when a debtor is in default under a security agreement; and




          (iii) to collect, receive, assemble, process, appropriate, sell, lease,
assign, grant an option or options to purchase or otherwise dispose of, deliver, or realize
upon, the Collateral or any part thereof in one or more parcels at public or private sale or
sales (which sales may be adjourned or continued from time to time with or without notice
and may take place at the Grantor’s premises or elsewhere), for cash, on credit or for
future delivery without assumption of any credit risk, and upon such other terms as the
Lender may deem commercially reasonable.



          (b) The Lender may comply with any applicable state or federal law requirements in connection
with a disposition of the Collateral and compliance will not be considered to adversely affect the
commercial reasonableness of any sale of the Collateral.




          (c) The Lender shall have the right upon any such public sale or sales and, to the extent
permitted by law, upon any such private sale or sales, to purchase for the benefit of the Lender,
the whole or any part of the Collateral so sold, free of any right of equity redemption, which
equity redemption the Grantor hereby expressly releases.




          (d) Until the Lender is able to effect a sale, lease, or other disposition of Collateral, the
Lender shall have the right to hold or use Collateral, or any part thereof, to the extent that it
deems appropriate for the purpose of preserving Collateral or its value or for any other purpose
deemed appropriate by the Lender. The Lender may, if it so elects, seek the appointment of a
receiver or keeper to take possession of Collateral and to enforce any of the Lender’s remedies,
with respect to such appointment without prior notice or hearing as to such appointment.




          (e) Notwithstanding the foregoing, the Lender shall not be required to (i) make any demand
upon, or pursue or exhaust any of their rights or remedies against, the Grantor, any other obligor,
guarantor, pledgor or any other Person with respect to the payment of the Secured Obligations or to
pursue or exhaust any of their rights or remedies with respect to any Collateral therefor or any
direct or indirect guarantee thereof, (ii) marshal the Collateral or any guarantee of the Secured
Obligations or to resort to the Collateral or any such guarantee in any particular order, or (iii)
effect a public sale of any Collateral.





6











 





          (f) The Grantor recognizes that the Lender may be unable to effect a public sale of any or all
the Pledged Collateral and may be compelled to resort to one or more private sales thereof in
accordance with clause (a) above. The Grantor also acknowledges that any private sale may
result in prices and other terms less favorable to the seller than if such sale were a public sale
and, notwithstanding such circumstances, agrees that any such private sale shall not be deemed to
have been made in a commercially unreasonable manner solely by virtue of such sale being private.



     5.3. Grantor’s Obligations Upon Default. Upon the request of the Lender after the
occurrence of an Event of Default, the Grantor will:



          (a) assemble and make available to the Lender the Collateral and all books and records
relating thereto at any place or places specified by the Lender, whether at the Grantor’s premises
or elsewhere; and



          (b) permit the Lender, by the Lender’s representatives and agents, to enter, occupy and use
any premises where all or any part of the Collateral, or the books and records relating thereto, or
both, are located, to take possession of all or any part of the Collateral or the books and records
relating thereto, or both, to remove all or any part of the Collateral or the books and records
relating thereto, or both, and to conduct sales of the Collateral, without any obligation to pay
the Grantor for such use and occupancy.



     5.4. Grant of Intellectual Property License. For the sole purpose of enabling the
Lender to exercise the rights and remedies under this Article V at such time as the Lender
shall be lawfully entitled to exercise such rights and remedies, the Grantor hereby grants to the
Lender an irrevocable, nonexclusive license (exercisable without payment of royalty or other
compensation to the Grantor) to use, license or sublicense any Patent or Trademark now owned or
hereafter acquired by the Grantor, and wherever the same may be located, and including in such
license access to all media in which any of the licensed items may be recorded or stored and to all
computer software and programs used for the compilation or printout thereof.



ARTICLE VI

ACCOUNT VERIFICATION; ATTORNEY IN FACT; PROXY




     6.1. Authorization for Secured Party to Take Certain Action.



          (a) The Grantor irrevocably authorizes the Lender at any time and from time to time in the
sole discretion of the Lender and appoints the Lender as its attorney in fact (i) to execute on
behalf of the Grantor as debtor and to file financing statements necessary or desirable in the
Lender’s sole discretion to perfect and to maintain the perfection and priority of the Lender’s
security interest in the Collateral when otherwise authorized under the other terms of the Loan
Agreement and this Security Agreement, (ii) to endorse and collect any cash proceeds of the
Collateral, (iii) to file a carbon, photographic or other reproduction of this Security Agreement
or any financing statement with respect to the Collateral as a financing statement and to file any
other financing statement or amendment of a financing statement (which does not add new collateral
or add a debtor) in such offices as the Lender in its sole discretion deems necessary or desirable
to perfect and to maintain the perfection and priority of the Lender’s security interest in the
Collateral, (iv) to apply the proceeds of any Collateral received by the Lender to the Secured
Obligations, (v) to discharge past due taxes, assessments, charges, fees or liens on the Collateral
other than Permitted Liens, and (vi) to do all other acts and things necessary to carry out this
Security Agreement; and the Grantor agrees to reimburse the Lender on demand for any reasonable
payment made or any reasonable expense incurred by the Lender in connection with any of the
foregoing; provided that, this authorization shall not relieve the Grantor of any of its
obligations under this Security Agreement or under the Loan Agreement.



7









 





          (b) All acts of said attorney or designee are hereby ratified and approved. The powers
conferred on the Lender, under this Section 6.1 are solely to protect the Lender’s interests in the
Collateral and shall not impose any duty upon the Lender to exercise any such powers. The Lender
agrees that, except for the powers granted in Section 6.1 (a)(v) and (vi), it shall not exercise
any power or authority granted to it unless a Default has occurred and is continuing. Unless an
Event of Default has occurred and is continuing, any funds received on account of the endorsement
of checks payable to the Grantor shall be deposited in the bank account of the Grantor.



     6.2. Nature of Appointment; Limitation of Duty. THE APPOINTMENT OF THE LENDER AS
ATTORNEY-IN-FACT IN THIS ARTICLE VI IS COUPLED WITH AN INTEREST AND SHALL BE IRREVOCABLE UNTIL THE
DATE ON WHICH THIS SECURITY AGREEMENT IS TERMINATED IN ACCORDANCE WITH SECTION 8.14.
NOTWITHSTANDING ANYTHING CONTAINED HEREIN, NEITHER THE LENDER NOR ANY OF ITS RESPECTIVE AFFILIATES,
OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR REPRESENTATIVES SHALL HAVE ANY DUTY TO EXERCISE ANY RIGHT
OR POWER GRANTED HEREUNDER OR OTHERWISE OR TO PRESERVE THE SAME AND SHALL NOT BE LIABLE FOR ANY
FAILURE TO DO SO OR FOR ANY DELAY IN DOING SO, EXCEPT IN RESPECT OF DAMAGES ATTRIBUTABLE SOLELY TO
THEIR OWN GROSS NEGLIGENCE OR WILLFUL MISCONDUCT AS FINALLY DETERMINED BY A COURT OF COMPETENT
JURISDICTION; PROVIDED THAT, IN NO EVENT SHALL THEY BE LIABLE FOR ANY PUNITIVE, EXEMPLARY, INDIRECT
OR CONSEQUENTIAL DAMAGES.



ARTICLE VII

INTENTIONALLY OMITTED




ARTICLE VIII

GENERAL PROVISIONS




     8.1. Waivers. Any notice of the time and place of any public sale or the
time after which any private sale or other disposition of all or any part of the Collateral shall
be deemed reasonable if sent to the Grantor, addressed as set forth in Article IX, at least ten
days prior to (i) the date of any such public sale or (ii) the time after which any such private
sale or other disposition may be made. To the maximum extent permitted by applicable law, the
Grantor waives all claims, damages, and demands against the Lender arising out of the repossession,
retention or sale of the Collateral, except such as arise solely out of the gross negligence or
willful misconduct of the Lender as finally determined by a court of competent jurisdiction. To the
extent it may lawfully do so, the Grantor absolutely and irrevocably waives and relinquishes the
benefit and advantage of, and covenants not to assert against the Lender, any valuation, stay,
appraisal, extension, moratorium, redemption or similar laws and any and all rights or defenses it
may have as a surety now or hereafter existing which, but for this provision, might be applicable
to the sale of any Collateral made under the judgment, order or decree of any court, or privately
under the power of sale conferred by this Security Agreement, or otherwise. Except as otherwise
specifically provided herein, the Grantor hereby waives presentment, demand, protest or any notice
(to the maximum extent permitted by applicable law) of any kind in connection with this Security
Agreement or any Collateral.



     8.2. Limitation on the Lender’s Duty with Respect to the Collateral. The
Lender shall have no obligation to prepare the Collateral for sale. To the extent that applicable
law imposes duties on the Lender to exercise remedies in a commercially reasonable manner, the
Grantor acknowledges and agrees that it is commercially reasonable for the Lender (i) to fail to
incur expenses deemed significant by the Lender to prepare Collateral for disposition, (ii) to fail
to obtain governmental or third party consents for the collection or



8









 




disposition of Collateral to be collected or disposed of, (iii) to fail to remove liens or
security interests on or any adverse claims against Collateral, (iv) to advertise dispositions of
Collateral through publications or media of general circulation, whether or not the Collateral is
of a specialized nature, (v) to contact other Persons, whether or not in the same business as the
Grantor, for expressions of interest in acquiring all or any portion of such Collateral, (vi) to
hire one or more professional auctioneers to assist in the disposition of Collateral, whether or
not the Collateral is of a specialized nature, (vii) to dispose of Collateral by utilizing internet
sites that provide for the auction of assets of the types included in the Collateral or that have
the reasonable capacity of doing so, or that match buyers and sellers of assets, (viii) to disclaim
disposition warranties, such as title, possession or quiet enjoyment, or (ix) to the extent deemed
appropriate by the Lender, to obtain the services of other brokers, consultants and other
professionals to assist the Lender in the collection or disposition of any of the Collateral. The
Grantor acknowledges that the purpose of this Section 8.2 is to provide non-exhaustive indications
of what actions or omissions by the Lender would be commercially reasonable in the Lender’s
exercise of remedies against the Collateral and that other actions or omissions by the Lender shall
not be deemed commercially unreasonable solely on account of not being indicated in this Section
8.2. Without limitation upon the foregoing, nothing contained in this Section 8.2 shall be
construed to grant any rights to the Grantor or to impose any duties on the Lender that would not
have been granted or imposed by this Security Agreement or by applicable law in the absence of this
Section 8.2.




     8.3. Intentionally Omitted.



     8.4. Secured Party Performance of Debtor Obligations. Without having any
obligation to do so, the Lender may perform or pay any obligation which the Grantor has agreed to
perform or pay in this Security Agreement and the Grantor shall reimburse the Lender for any
reasonable amounts paid by the Lender pursuant to this Section 8.4. The Grantor’s obligation to
reimburse the Lender pursuant to the preceding sentence shall be a Secured Obligation payable on
demand.



     8.5. Specific Performance of Certain Covenants. The Grantor acknowledges
and agrees that a breach of any of the covenants contained in Sections 4.1(d), 4.1(e), 4.2, 4.3,
4.5, 5.3, or 8.7 will cause irreparable injury to the Lender, that the Lender has no adequate
remedy at law in respect of such breaches and therefore agrees, without limiting the right of the
Lender to seek and obtain specific performance of other obligations of the Grantor contained in
this Security Agreement, that the covenants of the Grantor contained in the Sections referred to in
this Section 8.5 shall be specifically enforceable against the Grantor.



     8.6. Dispositions Not Authorized. Except to the extent provided in the Loan
Agreement, the Grantor is not authorized to sell or otherwise dispose of the Collateral and
notwithstanding any course of dealing between the Grantor and the Lender or other conduct of the
Lender, no authorization to sell or otherwise dispose of the Collateral shall be binding upon the
Lender unless such authorization is in writing signed by the Lender.



     8.7. No Waiver; Amendments; Cumulative Remedies. No delay or omission of the
Lender to exercise any right or remedy granted under this Security Agreement shall impair such
right or remedy or be construed to be a waiver of any Default or Event of Default or an
acquiescence therein, and any single or partial exercise of any such right or remedy shall not
preclude any other or further exercise thereof or the exercise of any other right or remedy. No
waiver, amendment or other variation of the terms, conditions or provisions of this Security
Agreement whatsoever shall be valid unless in writing signed by the Lender and then only to the
extent in such writing specifically set forth. All rights and remedies contained in this Security
Agreement or by law afforded shall be cumulative and all shall be available to the Lender until the
Secured Obligations have been paid in full.



     8.8. Limitation by Law; Severability of Provisions. All rights, remedies
and powers provided in this Security Agreement may be exercised only to the extent that
the exercise thereof does not violate any applicable



9









 




provision of law, and all the provisions
of this Security Agreement are intended to be subject to all applicable mandatory provisions of law
that may be controlling and to be limited to the extent necessary so that they shall not render
this Security Agreement invalid, unenforceable or not entitled to be recorded or registered, in
whole or in part. Any provision in any this Security Agreement that is held to be inoperative,
unenforceable, or invalid in any jurisdiction shall, as to that jurisdiction, be inoperative,
unenforceable, or invalid without affecting the remaining provisions in that jurisdiction or the
operation, enforceability, or validity of that provision in any other jurisdiction, and to this end
the provisions of this Security Agreement are declared to be severable.




     8.9. Reinstatement. This Security Agreement shall remain in full force and
effect and continue to be effective should any petition be filed by or against the Grantor for
liquidation or reorganization, should the Grantor become insolvent or make an assignment for the
benefit of any creditor or creditors or should a receiver or trustee be appointed for all or any
significant part of the Grantor’s assets, and shall continue to be effective or be reinstated, as
the case may be, if at any time payment and performance of the Secured Obligations, or any part
thereof, is, pursuant to applicable law, rescinded or reduced in amount, or must otherwise be
restored or returned by any obligee of the Secured Obligations, whether as a “voidable preference,”
“fraudulent conveyance,” or otherwise, all as though such payment or performance had not been made.
In the event that any payment, or any part thereof, is rescinded, reduced, restored or returned,
the Secured Obligations shall be reinstated and deemed reduced only by such amount paid and not so
rescinded, reduced, restored or returned.



     8.10. Benefit of Agreement. The terms and provisions of this Security
Agreement shall be binding upon and inure to the benefit of the Grantor, the Lender and their
respective successors and assigns (including all persons who become bound as a debtor to this
Security Agreement), except that the Grantor shall not have the right to assign its rights or
delegate its obligations under this Security Agreement or any interest herein, without the prior
written consent of the Lender. No sales of participations, assignments, transfers, or other
dispositions of any agreement governing the Secured Obligations or any portion thereof or interest
therein shall in any manner impair the Lien granted to the Lender hereunder.



     8.11. Survival of Representations. All representations and warranties of
the Grantor contained in this Security Agreement shall survive the execution and delivery of this
Security Agreement.



     8.12. Taxes and Expenses. Any taxes (including income taxes) payable or
ruled payable by Federal or State authority in respect of this Security Agreement shall be paid by
the Grantor, together with interest and penalties, if any. The Grantor shall reimburse the Lender
for any and all reasonable out-of-pocket expenses and internal charges (including reasonable
attorneys’, auditors’ and accountants’ fees and reasonable time charges of attorneys, paralegals,
auditors and accountants who may be employees of the Lender) paid or incurred by the Lender in
connection with the preparation, execution, delivery, administration, collection and enforcement of
this Security Agreement and in the audit, analysis, administration, collection, preservation or
sale of the Collateral (including the expenses and charges associated with any periodic or special
audit of the Collateral). Any and all costs and expenses incurred by the Grantor in the
performance of actions required pursuant to the terms hereof shall be borne solely by the Grantor.



     8.13. Headings. The title of and section headings in this Security
Agreement are for convenience of reference only, and shall not govern the interpretation of any of
the terms and provisions of this Security Agreement.



     8.14. Termination. This Security Agreement shall continue in effect
(notwithstanding the fact that from time to time there may be no Secured Obligations outstanding)
until (i) the Loan Agreement has terminated pursuant to its express terms and (ii) all of the
Secured Obligations then existing have been indefeasibly paid and performed in full and no
commitments of the Lender which would give rise to any
Secured Obligations are outstanding. Upon such termination, Lender agrees to promptly execute
and deliver to



10









 




the Grantor, at the Grantor’s cost and expense as provided in the Loan Agreement,
any and all releases of liens, termination statements, assignments, guaranties or other documents
reasonably requested by the Grantor as necessary to fully release the Collateral and the Secured
Obligations.




     8.15. Entire Agreement. This Security Agreement and the Loan Agreement
embodies the entire agreement and understanding between the Grantor and the Lender relating to the
Collateral and supersedes all prior agreements and understandings between the Grantor and the
Lender relating to the Collateral. If the terms of the Loan Agreement conflicts with the terms of
this Agreement, the terms of the Loan Agreement shall control.



     8.16. CHOICE OF LAW. THIS SECURITY AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF
TEXAS.



     8.17. Indemnity. Grantor hereby indemnifies and holds Lender harmless from
all claims, damages, liabilities (including reasonable attorneys’ fees and legal expenses), causes
of action, actions, suits and other legal proceedings (cumulatively, “Claims”) pertaining to its
respective businesses or the Collateral except to the extent such Claims are attributable to the
gross negligence or willful misconduct on the part of Lender. Grantor shall immediately provide
Lender with written notice of any such Claim. Grantor, upon the request of Lender, shall defend
Lender from such Claims, and pay the reasonable attorneys’ fees, legal expenses and other costs
incurred in connection therewith. In the alternative, Lender shall be entitled to employ its own
legal counsel to defend such Claims at Grantor’s reasonable cost.



     8.18. Counterparts. This Security Agreement may be executed in any number
of counterparts, all of which taken together shall constitute one agreement, and any of the parties
hereto may execute this Security Agreement by signing any such counterpart.



     8.19. Essence of Time. Grantor and Lender agree that time is of the essence
with respect to this Security Agreement.



ARTICLE IX

NOTICES




     9.1. Sending Notices. Any notice required or permitted to be given under this
Security Agreement shall be sent in accordance with the notice requirements of the Loan Agreement.



     9.2. Change in Address for Notices. Each of the Grantor and the Lender may change the
address for service of notice upon it by a notice in writing to the other parties sent in
accordance with the notice requirements of the Loan Agreement.



11









 





     IN WITNESS WHEREOF, the Grantor and the Lender have executed this Security Agreement as of the
date first above written.



	 	 	 	 	 
	 	GRANTOR:




RULES-BASED MEDICINE, INC.,

a Delaware corporation

 	 
	 	By:  	 	 
	 	 	Patrick McClain, Chief Financial Officer 	 
	 	 	 	 
	 
	 	LENDER:




COMPASS BANK, as Lender

 	 
	 	By:  	 	 
	 	 	Todd Jordan, Senior Vice President 	 
	 	 	 	 



12









 






	 	 	 	 	 



EXHIBIT A




LISTING OF EXISTING PATENTS

AND PATENT APPLICATIONS

(See attached Schedule)



 









 





EXHIBIT B




LISTING OF EXISTING TRADEMARKS

(See attached Schedule)




 












 






PATENT AND TRADEMARK SECURITY AGREEMENT



THIS PATENT AND TRADEMARK SECURITY AGREEMENT (“Agreement”), dated as of July ___, 2009, is
by and between RULES-BASED MEDICINE, INC., a Delaware corporation, whose address is 3300 Duval
Road, Austin, Texas 78759 (“Debtor”), and COMPASS BANK, whose address is 5800 North Mopac,
Austin, Texas 78731 (“Secured Party”).




     WHEREAS, Debtor and Secured Party have entered into that certain Commercial Loan Agreement (as
amended, restated and supplemented from time to time, the “Loan Agreement”) of even date
herewith;



     WHEREAS, Debtor and Secured Party have entered into a Security Agreement (Patents and
Trademarks) of even date herewith (as said Security Agreement may be amended, restated, modified,
supplemented and in effect from time to time, the “Security Agreement”), which sets forth
in more detail certain terms and conditions relating to the matters agreed to herein;



     WHEREAS, the Loan Agreement contemplates the execution of this Agreement by the parties hereto
and the recordation of this Agreement in accordance with the specific terms of the Loan Agreement;



     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:



     1. Grant of Security Interest. Debtor does hereby grant to Secured Party a continuing
security interest in all of Debtor’s right, title, and interest in and to all of the following (all
of the following being herein collectively referred to as the “Collateral”), whether
presently existing or hereafter arising or acquired, to secure the payment of the Secured
Obligations (as defined in the Security Agreement):




     (a) any and all patents and patent applications (including, without limitation, each
patents and patent applications listed on Schedule 1 attached hereto), together with
(i) all inventions and improvements described and claimed therein, (ii) all reissues,
divisions, continuations, renewals, extensions, and continuations-in-part thereof, (iii) all
income, royalties, damages, claims, and payments now or hereafter due or payable under and
with respect thereto, including, without limitation, damages and payments for past and
future infringements thereof, (iv) all rights to sue for past, present, and future
infringements thereof, and (v) all rights corresponding to any of the foregoing throughout
the world;




     (b) all trademarks (including service marks), trade names, trade dress, and trade
styles and the registrations and applications for registration thereof and the goodwill of
the business symbolized by the foregoing (including, without limitation, each trademark
listed on Schedule 2 attached hereto), together with (i) all renewals of the
foregoing, (ii) all income, royalties, damages, and payments now
or hereafter due or payable with respect



1









 







thereto, including, without limitation, damages, claims, and payments for past
and future
infringements thereof, (iii) all rights to sue for past, present, and future
infringements of the foregoing, including the right to settle suits involving claims and
demands for royalties owing, and (iv) all rights corresponding to any of the foregoing
throughout the world;




     (c) all licenses or similar arrangements of any of the foregoing, whether as
licensee or licensor;




     (d) all general intangibles at any time evidencing or relating to any of the foregoing,
together with all books and records, computer files, programs, printouts and other computer
materials and records related thereto; and




     (e) all products and proceeds of any of the foregoing.



     2. Miscellaneous. This security interest is granted in conjunction with the security
interest granted to Secured Party pursuant to the Security Agreement. Debtor does hereby further
acknowledge and affirm that the rights and remedies of Secured Party respect to the security
interest in the Collateral made and granted hereby are more fully set forth in the Security
Agreement and the Loan Agreement, the terms and provisions of which are incorporated by reference
herein as if fully set forth herein. The terms and provisions hereof are in addition to, and not
in limitation of or limited by, those of the Security Agreement, the Loan Agreement and the other
Loan Documents. The attached Schedules 1 and 2 are incorporated herein by
reference for all purposes. Capitalized terms used herein and not otherwise defined shall have the
meaning given to them in the Loan Agreement. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND THE UNITED STATES OF AMERICA, INCLUDING WITHOUT
LIMITATION, THE UNITED STATES PATENT AND TRADEMARK LAWS. This Agreement shall be binding upon
Debtor, and the trustees, receivers, successors and assigns of Debtor, including all successors in
interest of Debtor in and to all or any part of the Collateral, and shall benefit Secured Party and
its successors and assigns. If any provision of this Agreement is held to be illegal, invalid or
unenforceable under present or future laws, the legality, validity and enforceability of the
remaining provisions of this Agreement shall not be affected thereby, and this Agreement shall be
liberally construed so as to carry out the intent of the parties to it. This Agreement may be
executed in any number of counterparts, all of which taken together shall constitute one and the
same agreement, and any of the parties hereto may execute this Agreement by signing any such
counterpart. The section headings appearing in this Agreement have been inserted for convenience
only and shall be given no substantive meaning or significance whatever in construing the terms and
provisions of this Agreement.



[Remainder of page left intentionally blank]



2









 





     IN WITNESS WHEREOF, Debtor and Secured Party have caused this Agreement to be duly executed by
their respective officers thereunto as of the date first set forth above.



	 	 	 	 	 
	 	“Debtor”





RULES-BASED MEDICINE, INC., a Delaware corporation

 	 
	 	By:  	 	 
	 	 	Patrick McClain, Chief Financial Officer 	 
	 
	 
	 	“Secured Party”




COMPASS BANK,

a state banking corporation

 	 
	 	By:  	 	 
	 	 	Todd Jordan, Senior Vice President 	 
	 	 	 	 
	 


Attachment:




Schedule 1 — Patents and Applications



Schedule 2 — Trademarks




	 	 	 	 	 
	THE STATE OF TEXAS

	 	§
	 	 
	 

	 	§	 	 
	COUNTY OF TRAVIS

	 	§	 	 






     This instrument was acknowledged before me on                                         , 2009, by Patrick McClain,
Chief Financial Officer of Rules-Based Medicine, Inc., a Delaware corporation, on behalf of said
corporation.



	 	 	 	 	 	 	 
	 
	 
	 	 	 
	 	 	Notary Public in and for the State of Texas  
	 

	 	Printed Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	My Commission Expires:
	 
	 	 	 	 	 





3








 





	 	 	 	 	 
	THE STATE OF TEXAS

	 	§
	 	 
	 

	 	§
	 	 
	COUNTY OF TRAVIS

	 	§
	 	 






     This instrument was acknowledged before me on                                         , 2009, by Todd Jordan, Senior
Vice President of Compass Bank, an Alabama state banking corporation, on behalf of said
corporation.



	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 

	 

	 


	 	 	 	 	Notary Public in and for the State of Texas
	 

	 	 	 	Printed Name:	 	 


	 	 	 	 	My Commission Expires:
	 

	 	 	 	 

	 

	 








4









 






SCHEDULE 1 TO

PATENT AND TRADEMARK SECURITY AGREEMENT




PATENTS AND PATENT APPLICATIONS

(See attached Schedule)



 









 





SCHEDULE 2 TO

PATENT AND TRADEMARK SECURITY AGREEMENT




TRADEMARKS

(See attached Schedule)




 











 











UCC FINANCING STATEMENT




FOLLOW INSTRUCTIONS (front and back) CAREFULLY











A. NAME & PHONE OF CONTACT AT FILER [optional]




 





B. SEND ACKNOWLEDGMENT TO: (Name and Address)




	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 	 	COMPASS BANK	 	 	 
	 	 	5800 North Mopac	 	 	 
	 	 	Austin, Texas 78731	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 	 













         THE ABOVE SPACE IS FOR FILING OFFICE USE ONLY

 












	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	1. DEBTOR’S EXACT
FULL LEGAL NAME — insert only one debtor name (1a or 1b) — do not abbreviate or combine names
	 	 	 
	OR	 	1a. ORGANIZATION’S NAME
	 	RULES-BASED MEDICINE, INC.
	 	 
	 	1b. INDIVIDUAL’S LAST NAME	 	FIRST NAME	 	MIDDLE NAME	 	 	 	SUFFIX
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	1c. MAILING ADDRESS	 	CITY	 	STATE	 	POSTAL CODE	 	COUNTRY
	3300 Duval Road	 	Austin	 	TX	 	78759 	 	USA
	 
	1d. SEE INSTRUCTIONS	 	ADD’L INFO RE
ORGANIZATION DEBTOR	 	1e. TYPE OF ORGANIZATION	 	1f. JURISDICTION OF ORGANIZATION	 	1g. ORGANIZATIONAL ID #, if any
	 	 	 	 	 	 	corporation	 	Delaware	 	None 	 	þ NONE
	 
	2. ADDITIONAL
DEBTOR’S EXACT FULL LEGAL NAME — insert only one debtor name (2a or 2b) — do not abbreviate or combine names
	 	 	 
	OR	 	2a. ORGANIZATION’S NAME
	 	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 
	 	2b. INDIVIDUAL’S LAST NAME	 	FIRST NAME	 	MIDDLE NAME	 	 	 	SUFFIX
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	2c. MAILING ADDRESS	 	CITY	 	STATE	 	POSTAL CODE	 	COUNTRY
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	2d. SEE INSTRUCTIONS	 	ADD’L INFO RE
ORGANIZATION
DEBTOR	 	2e. TYPE OF ORGANIZATION	 	2f. JURISDICTION OF ORGANIZATION	 	2g. ORGANIZATIONAL ID #, if any
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	o NONE
	 
	3. SECURED
PARTY’S NAME (or NAME of TOTAL ASSIGNEE of ASSIGNOR S/P) —
insert only one secured party name (3a or 3b)
	 	 	 
	OR	 	3a. ORGANIZATION’S NAME
	 	COMPASS BANK
	 	 
	 	3b. INDIVIDUAL’S LAST NAME	 	FIRST NAME	 	MIDDLE NAME	 	 	 	SUFFIX
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	3c. MAILING ADDRESS	 	CITY	 	STATE	 	POSTAL CODE	 	COUNTRY
	5800 North Mopac	 	Austin	 	TX	 	78731 	 	USA
	 
	4. This FINANCING STATEMENT covers the following collateral:







All of the Debtor’s accounts receivable, inventory, equipment and related general intangibles, now
owned or hereafter, acquired, including all monies, instruments and savings, checking or other
deposit accounts within Secured Party’s custody or control (excluding IRA, Keogh, trust accounts,
and deposits subject to tax penalties if so assigned); all accessions, accessories, additions,
amendments, attachments, modifications, replacements and substitutions to any of the above; all
proceeds and products of any of the above; all policies of insurance pertaining to any of the above
as well as any proceeds and unearned premiums pertaining to such policies; and all books and
records pertaining to any of the above.










	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	5. ALTERNATIVE
DESIGNATION [if applicable]: o LESSEE/LESSOR    o CONSIGNEE/CONSIGNOR     o
BAILEE/BAILOR     o SELLER/BUYER    o AG. LIEN    
o NON-UCC FILING
	 
	6.

	 	o
	 	This FINANCING STATEMENT is to be
filed (for record) (or recorded) in the REAL
ESTATE RECORDS. Attach Addendum            [if applicable]
	 	 	7.	 	 	Check to REQUEST SEARCH REPORT(S) on Debtor(s)
[ADDITIONAL FEE]           [optional]
	 	o All Debtors o Debtor 1 o Debtor 2
	 
	8. OPTIONAL FILER REFERENCE DATA
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	International Association of Commercial Administrators (IACA)






FILING OFFICE COPY — UCC FINANCING STATEMENT (FORM UCC1) (REV. 05/22/02)

















 







CERTIFICATE OF CORPORATE RESOLUTION




     We, Patrick McClain, Chief Financial Officer, and T. Craig Benson, Secretary, of Rules-Based
Medicine, Inc., a corporation, do hereby certify that said corporation is duly organized and
existing under the laws of the State of Delaware and is licensed to do business in the State of
Texas; that said corporation has a duration of existence which is perpetual, that all franchise and
other taxes required to maintain its corporate existence have been paid when due and that no such
taxes are delinquent; that no proceedings are pending for the forfeiture of its charter or for its
dissolution, voluntarily or involuntarily; that there is no provision of the Amended and Restated
Certificate of Incorporation or bylaws of said corporation limiting the power of the Board of
Directors to pass the resolution set out below and that the same is in conformity with the
provisions of said Amended and Restated Certificate of Incorporation and bylaws; that the Secretary
is the keeper of the records and minutes of the proceedings of the Board of Directors of said
corporation and that on the _____  day of August, 2009, there was held a meeting of the Board of
Directors of said corporation, which was duly called and held in accordance with the law and the
bylaws of the corporation, at which meeting the required number of Directors were present; and that
at said meeting the following resolution was duly and legally passed, approved and adopted by all
of the Directors and that the same has not been altered, amended, rescinded or repealed and is now
in full force and effect:



     RESOLVED, that Patrick McClain, Chief Financial Officer, is authorized in the name of the
corporation and as its own act, to borrow the sum of NINE MILLION AND NO/100 DOLLARS
($9,000,000.00) from Compass Bank, and on behalf, and as the act, of this corporation to deliver to
said Compass Bank, a revolving promissory note of this corporation in a form, at an interest rate
and on terms as the aforesaid Chief Financial Officer may in his discretion determine to be in the
best interest of the corporation; and



 









 





     RESOLVED FURTHER, that as and for security for the aforementioned loans, the aforesaid Chief
Financial Officer is authorized and directed to execute and deliver to Compass Bank, such
documents, including a Commercial Security Agreement and Security Agreement (Patents and
Trademarks), evidencing the pledge of personal property more particularly described therein and the
herein below described property of the corporation in a form to be agreed on by the aforesaid Chief
Financial Officer and said Compass Bank, to wit:




	 	 	 	All of the corporation’s accounts receivable, inventory, equipment, general
intangibles, patents and trademarks, now owned or hereafter acquired; and





     RESOLVED FURTHER, that the Board of Directors does hereby ratify all actions taken hereunder
pursuant to this Resolution; and



     RESOLVED FURTHER, that the Chief Financial Officer and Secretary of the corporation are
directed to certify the minutes of this meeting and the contents of these resolutions and to
deliver such certification in support of the authority of the aforesaid Chief Financial Officer to
act on behalf of the corporation; and



     RESOLVED FURTHER, that the foregoing powers and authority shall continue in full force and
effect until written notice of revocation has been given Compass Bank and its written
acknowledgment of receipt has been obtained therefor.



     We further certify that the Purpose Clause of the Articles of Incorporation has included in it
the standard general purpose.



     We further acknowledge that this Certificate of Corporate Resolution is executed for the
purpose and consideration of inducing Compass Bank to make the referenced loan to the corporation.



2









 






     We further certify that the persons executing this instrument are the Chief Financial Officer
and Secretary of Rules-Based Medicine, Inc. and are authorized to act upon and sign this
certificate.



     IN WITNESS WHEREOF, we have hereunto set our hands as Chief Financial Officer and Secretary,
respectively, of said corporation and have attached hereto the official seal of said corporation,
this                      day of August, 2009.



	 	 	 	 	 
	 	 	 
	 	
 	 
	 	Patrick McClain, Chief Financial Officer 	 



	 	 	 	 	 
	 	
 	 
	 	T. Craig Benson, Secretary 	 
	 	 	 
	 



ACKNOWLEDGMENTS




	 	 	 	 	 
	STATE OF TEXAS
	|	 	 	 
	 
	|	 	 	 
	COUNTY OF _______________
	|	 	 	 






     BEFORE ME, the undersigned authority, on this day personally appeared Patrick McClain, Chief
Financial Officer of Rules-Based Medicine, Inc., known to me to be the person whose name is
subscribed to the foregoing instrument and acknowledged to me that he executed the same as the act
and deed of said corporation, for the purposes and considerations therein expressed, and in the
capacity therein stated.



     GIVEN under my hand and seal of office, this the                      day of                                    , 2009.



	 	 	 	 	 
	 	 	 
	 	
 	 
	 	Notary Public in and for the State of Texas 	 
	 	 	 



3









 








	 	 	 	 	 
	STATE OF TEXAS
	|	 	 	 
	 
	|	 	 	 
	COUNTY OF _______________
	|	 	 	 






     BEFORE ME, the undersigned authority, on this day personally appeared T. Craig Benson,
Secretary of Rules-Based Medicine, Inc., known to me to be the person whose name is subscribed to
the foregoing instrument and acknowledged to me that he executed the same as the act and deed of
said corporation, for the purposes and considerations therein expressed, and in the capacity
therein stated.



     GIVEN under my hand and seal of office, this the                      day of                                         , 2009.



	 	 	 	 	 
	 	 	 
	 	
 	 
	 	Notary Public in and for the State of Texas 	 
	 	 	 
	 





4











 






LANDLORD’S SUBORDINATION




	 	 	 
	STATE OF TEXAS
	 	|

	 	 	|

	COUNTY OF TRAVIS
	 	|







     THIS AGREEMENT IS made and entered into effective as of the                 day of                     ,
2009, by and among CFO2 AUSTIN, LLC, a Delaware limited liability company (Landlord), COMPASS BANK, an Alabama state chartered bank (Lender), and RULES-BASED MEDICINE,
INC., a Delaware corporation (Borrower).



W I T N E S S E T H:




     WHEREAS, Landlord owns fee simple title to the land located at 3300 Duval Road, Austin, Texas
78759 (the Leased Premises); and



     WHEREAS, Landlord has leased the Leased Premises and the improvements constructed or to be
constructed on the Leased Premises to Borrower under that certain Lease Agreement dated March 18,
2003, thereafter amended by First Amendment to Lease Agreement dated April 2007 and further amended
by Second Lease Amendment to Lease Agreement dated September 2, 2008 (said Lease Agreement, as it
may have been or may be further amended, supplemented or restated, being hereinafter called the Lease); and



     WHEREAS, Borrower has signed a revolving promissory note dated August ___, 2009, and made
payable to the order of Lender (such promissory note, as the same may have been, or may at any time
be, modified and amended, being hereinafter called the Note); and



     WHEREAS, payment of the indebtedness evidenced by the Note is secured by a Commercial Security
Agreement (the Security Agreement) of even date therewith, by which Borrower has
granted Lender a security interest in all of Borrower’s accounts receivable, inventory,
equipment and general intangibles intangibles, now owned or hereafter acquired (the Collateral); and




     WHEREAS, various other documents (the Credit Documents) have been signed in
connection with the Note;



     NOW, THEREFORE, the parties hereto, for and in consideration of the premises and the
transactions to which this Agreement is incident and supplemental, do hereby agree as follows:



     1. Landlord agrees that any landlord’s lien that Landlord may now or hereafter have, as
a result of the Lease, against any personal property or removable fixtures owned by Borrower,
including specifically the Collateral, shall be subordinate and inferior to any security interest
in, or lien against, the Collateral that is held by Lender.



     2. Landlord further consents to the location of the Collateral on the leased premises. In the event
of default by Borrower in the payment or performance under the Credit Documents, and upon written
notice to Landlord of such event of default, Landlord (i) will reasonably cooperate with Lender,
its agents, attorneys, employees, successors and assigns, in its efforts to assemble all of the
Collateral located on the Leased Premises, to the extent Landlord is permitted to do so, (ii) will





 









 







permit Lender to remove the Collateral from the Leased Premises to the extent Landlord is permitted to do
so, and (iii) will not hinder Lender’s actions in enforcing its security interests in the
Collateral; provided that (A) any entry to the Leased Premises by Lender shall be scheduled with
Landlord, and (B) such entry, assembly and removal is conducted in accordance with applicable law
and is performed at Lender’s sole cost and expense. Lender shall repair, at Lender’s sole expense,
and reimburse Landlord for any reasonable costs incurred by Landlord related to, any and all damage
caused in connection with Lender’s or Lenders’ exercise of their rights pursuant to this Agreement
to (x) any real property improvements located on the Leased Premises and (y) Landlord’s personal or
real property. In addition, Lender shall indemnify Landlord from any loss, claim or damage which
may occur as a result of Lender’s entry onto the Leased Premises or the acts or omissions of Lender
in connection with this Agreement. Landlord agrees that it will not unreasonably delay the
scheduling of the entry to the Leased Premises set forth above.




     3. Landlord and Lender agree that any lien granted in excess of the loan amount shall be
subject to the constitutional, statutory or contractual landlord’s lien of the Landlord. However,
any lien now or hereafter granted in the Credit Documents up to the loan amount shall be prior and
superior to Landlord.



     4. If any of the Collateral remains upon the Leased Premises upon the expiration of the term
of the lease, the termination of the lease or the Tenant’s right to possession of the Leased
Premises, or Tenant’s abandonment of the Leased Premises, Landlord or Tenant may give the Lender
written notice that Landlord is in possession of the Leased Premises. After Lender’s receipt of
such notice, Lender agrees to use reasonable efforts to quickly assess whether or not it chooses to
gain possession of the Collateral and notify Landlord if the Lender chooses not to take possession.
Lender acknowledges that simultaneously with Lender’s pursuit for possession of the Collateral,
Landlord will begin the process to gain control of the Collateral for sale or disposal. If Lender
is unable or unwilling to remove such Collateral within 30 days after Lender receipt of the
earliest written notification, and notwithstanding that the Lender is prohibited from doing so for
reason outside of Lender’s control, Lender agrees to pay rent in the amount of $100 per day to the
Landlord commencing on the 31st day after written notice, if Lender chooses to take
possession of the Collateral from Landlord. If Lender fails to remove the Collateral within 45
days, Landlord may remove the Collateral from Leased Premises in accordance with the law.



     5. This Agreement shall bind and benefit the parties hereto and their respective heirs, legal
representatives, successors and assigns. This Agreement embodies the entire agreement and
understanding of Borrower, Landlord and Lender relating to the subject matter hereof and supersedes
all prior proposals, negotiations, agreements and understandings related to such subject matter.



     6. This Agreement may not be discharged or modified orally or in any manner other than by an
agreement in writing specifically referring to this Agreement and signed by the party or parties to
be charged thereby.



     7. This Agreement shall be governed by and construed in accordance with the laws
of the State of Texas and the United States of America. This Agreement may be executed
in one or more counterparts which shall be construed together as one document. Any
party who executes a




2











 





counterpart of this Agreement shall be fully liable hereunder, whether or not any other party named
herein executes that counterpart or any other counterpart of this Agreement, and the obligations of
any party hereunder may be proved by production of the counterpart of this Agreement executed by
such party without the production of any other counterparts of this Agreement.




     IN TESTIMONY WHEREOF, this instrument is executed, effective as of the date stated above.



	 	 	 
	LANDLORD:

	 	LENDER:
	 
	 	 
	CFO2 AUSTIN, LLC, a Delaware 

limited liability company

	 	COMPASS BANK






	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	By:

	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 
	 	Name:
	 	 	 	 	Todd Jordan, Senior Vice President	 	 
	 

	 	 	 	 	 	 	 	 
	 	Title:
	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 





 BORROWER:




RULES-BASED MEDICINE, INC.,

a Delaware corporation




	 	 	 	 	 
	 	By:  	 	 
	 	 	Patrick McClain, Chief Financial Officer 	 
	 	 	 	 



	 	 	 
	STATE OF TEXAS

	 	|
	 

	 	|
	COUNTY OF                                         

	 	|






     This
instrument was acknowledged before me on the ___ day of                     , 2009, by
                                    ,                                         
of CFO2 Austin, LLC, a Delaware limited liability
company, on behalf of said company.



	 	 	 	 	 	 	 
	 
	 	 	 	 	 
	 	 	Notary Public in and for the State of Texas	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 
	 

	 	Printed Name	 	 	 	 
	 

	 	My Commission Expires:	 	 	 	 
	 

	 	 	 	 	 	 





3









 





	 	 	 
	STATE OF TEXAS

	 	|
	 

	 	|
	COUNTY OF                                         

	 	|






     This
instrument was acknowledged before me on the ___ day of                     , 2009, by
                     
                   ,   
                      
                 of Compass Bank, an Alabama state chartered
bank, on behalf of said bank.



	 	 	 	 	 	 	 
	 
	 	 	 	 	 
	 	 	Notary Public in and for the State of Texas	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Printed Name	 	 	 	 
	 

	 	My Commission Expires:	 	 	 	 
	 

	 	 	 	 	 	 





	 	 	 
	STATE OF TEXAS

	 	|
	 

	 	|
	COUNTY OF                                         

	 	|






     This instrument was acknowledged before me on the ___day of                     , 2009, by
Patrick McClain, Chief Financial Officer of Rules-Based Medicine, Inc., a Delaware corporation, on
behalf of said corporation.



	 	 	 	 	 	 	 
	 
	 	 	 	 	 
	 	 	Notary Public in and for the State of Texas	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Printed Name	 	 	 	 
	 

	 	My Commission Expires:	 	 	 	 
	 

	 	 	 	 	 	 





4











 






LANDLORD’S SUBORDINATION




	 	 	 	 	 
	STATE OF NEW YORK

	 	|
	 	 
	 

	 	|	 	 
	COUNTY OF ESSEX

	 	|	 	 






     THIS AGREEMENT IS made and entered into effective as of the                      day of                     ,
2009, by and among ROBERT PEACOCK and GREGORY PEACOCK (Landlord), COMPASS BANK, an
Alabama state chartered bank (Lender), and RULES-BASED MEDICINE, INC., a Delaware
corporation (Borrower).



W I T N E S S E T H:




     WHEREAS, Landlord owns fee simple title to the land located at 7 Wesvalley Rd., Suite 2, Lake
Placid, New York 12946 (the Leased Premises); and



     WHEREAS, Landlord has leased the Leased Premises and the improvements constructed or to be
constructed on the Leased Premises to Borrower under that certain Lease Agreement dated January 7,
2008 (said Lease Agreement, as it may have been or may be further amended, supplemented or
restated, being hereinafter called the Lease); and



     WHEREAS, Borrower has signed a revolving promissory note dated August ___, 2009, and made
payable to the order of Lender (such promissory note, as the same may have been, or may at any time
be, modified and amended, being hereinafter called the Note); and



     WHEREAS, payment of the indebtedness evidenced by the Note is secured by a Commercial Security
Agreement (the Security Agreement) of even date therewith, by which Borrower has
granted Lender a security interest in all of Borrower’s accounts receivable, inventory,
equipment and general intangibles intangibles, now owned or hereafter acquired (the Collateral); and



     WHEREAS, various other documents (the Credit Documents) have been signed in
connection with the Note;



     NOW, THEREFORE, the parties hereto, for and in consideration of the premises and the
transactions to which this Agreement is incident and supplemental, do hereby agree as follows:



     1. Landlord agrees that any landlord’s lien that Landlord may now or hereafter have, as
a result of the Lease, against any personal property or removable fixtures owned by Borrower,
including specifically the Collateral, shall be subordinate and inferior to any security interest
in, or lien against, the Collateral that is held by Lender.



     2. Landlord further consents to the location of the Collateral on the leased premises, and
hereby authorizes and empowers Lender, its agents, attorneys, employees, successors and assigns, to
enter the leased premises and remove the Collateral at any time under the provisions of the
Security Agreement.



 









 





     3. This Agreement shall bind and benefit the parties hereto and their respective heirs, legal
representatives, successors and assigns. This Agreement embodies the entire agreement and
understanding of Borrower, Landlord and Lender relating to the subject matter hereof and supersedes
all prior proposals, negotiations, agreements and understandings related to such subject matter.



     4. This Agreement may not be discharged or modified orally or in any manner other than by an
agreement in writing specifically referring to this Agreement and signed by the party or parties to
be charged thereby.



     5. This Agreement shall be governed by and construed in accordance with the laws of the State
of Texas and the United States of America. This Agreement may be executed in one or more
counterparts which shall be construed together as one document. Any party who executes a
counterpart of this Agreement shall be fully liable hereunder, whether or not any other party named
herein executes that counterpart or any other counterpart of this Agreement, and the obligations of
any party hereunder may be proved by production of the counterpart of this Agreement executed by
such party without the production of any other counterparts of this Agreement.



     IN TESTIMONY WHEREOF, this instrument is executed, effective as of the date stated above.



	 	 	 	 	 	 	 	 	 
	LANDLORD:	 	LENDER:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	COMPASS BANK	 	 
	 
	 	 	 	 	 	 	 	 
	 

Robert Peacock

	 	 By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 
	 

Gregory Peacock

	 	 
	 	 	 	 

	 	 
	 
	 	 	 	 	 	 	 	 




BORROWER:



RULES-BASED
MEDICINE, INC.,

a Delaware corporation




	 	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Patrick McClain, Chief Financial Officer
	 	 






2









 






	 	 	 	 	 
	STATE OF NEW YORK

	 	|
	 	 
	 

	 	|	 	 
	COUNTY OF _________

	 	|	 	 






     This instrument was acknowledged before me on the ___day of                     , 2009, by
Robert Peacock.



	 	 	 	 	 	 	 
	 
	 	 	 
	 	 	Notary Public in and for the State of New York
	 

	 	 	 	 	 	 
	 
	 	 	 
	 

	 	Printed Name	 	 	 	 
	 	 	My Commission Expires:	 	 






	 	 	 	 	 
	STATE OF NEW YORK

	 	|
	 	 
	 

	 	|	 	 
	COUNTY OF _________

	 	|	 	 






     This instrument was acknowledged before me on the ___day of                     , 2009, by
Gregory Peacock.



	 	 	 	 	 	 	 
	 
	 	 	 
	 	 	Notary Public in and for the State of New York
	 

	 	 	 	 	 	 
	 
	 	 	 
	 

	 	Printed Name	 	 	 	 
	 	 	My Commission Expires:	 	 






	 	 	 	 	 
	STATE OF TEXAS

	 	|
	 	 
	 

	 	|	 	 
	COUNTY OF _________

	 	|	 	 






     This instrument was acknowledged before me on the ___day of                     , 2009, by
                                        ,                                         
 of Compass Bank, an Alabama state chartered
bank, on behalf of said bank.



	 	 	 	 	 	 	 
	 
	 	 	 
	 	 	Notary Public in and for the State of Texas
	 

	 	 	 	 	 	 
	 
	 	 	 
	 

	 	Printed Name	 	 	 	 
	 	 	My Commission Expires:	 	 






	 	 	 	 	 
	STATE OF TEXAS

	 	|
	 	 
	 

	 	|	 	 
	COUNTY OF _________

	 	|	 	 






3









 






     This instrument was acknowledged before me on the ___day of                     , 2009, by
Patrick McClain, Chief Financial Officer of Rules-Based Medicine, Inc., a Delaware corporation, on
behalf of said corporation.



	 	 	 	 	 	 	 
	 
	 	 	 
	 	 	Notary Public in and for the State of Texas
	 

	 	 	 	 	 	 
	 
	 	 	 
	 

	 	Printed Name	 	 	 	 
	 	 	My Commission Expires:	 	 







4











 





AGREEMENT TO PROVIDE INSURANCE



DATE AND PARTIES. The date of this Agreement to Provide Insurance (Agreement) is August           ,
2009. The parties and their addresses are:




OWNER:

RULES-BASED MEDICINE, INC., a Delaware corporation

3300 Duval Road

Austin, Texas 78759




SECURED PARTY:

COMPASS BANK

5800 North Mopac

Austin, Texas 78731



The pronouns “you” and “your” refer to the Secured Party. The pronouns “I”, “me” and “my” refer to
each person or entity signing this Agreement as Owner.




	 	 	 	 	 	 	 	 	 	 	 
	1.	 	LOAN DESCRIPTION (Loan)	 	 
	 
	 

	 	A.
	 	Date.
	 	August           , 2009
	 	 
	 
	 
	 	B.	 	Loan Numbers.	 	 	                       	 	 	 
	 
	 
	 	C.	 	Loan Amount.	 	$	9,000,000.00	 	 	 





2. AGREEMENT TO PROVIDE INSURANCE. As part of my Loan, I acknowledge and agree to do all of the
following.





	 	A.	 	I will insure the Property as listed and with the coverages shown in the
DESCRIPTION OF PROPERTY section.
	 
	 	B.	 	I will have you named on the policy as the person to be paid under the policy
in the event of a loss, with the status listed under the STATUS section.
	 
	 	C.	 	I will arrange for the insurance company to notify you that the policy is in
effect and your status has been noted.
	 
	 	D.	 	I will pay for this insurance, including any fee for this endorsement.
	 
	 	E	 	I will keep the insurance in effect until the Property is no longer subject
to your security interest. (I understand that the Property may secure debts in
addition to any listed in the LOAN DESCRIPTION section.)
	 
	 	F.	 	I will purchase the insurance from an insurer that is authorized to do
business in the State of Texas or an eligible surplus lines insurer.
	 
	 	G.	 	I will deliver to you a copy of the policy and proof of the payment of the
premiums.




3. DESCRIPTION OF PROPERTY. The Property subject to this Agreement is described as follows:





	 	 	 	All of the Owner’s inventory and equipment, now owned or hereafter
acquired.




 









 










I agree to maintain the following insurance coverage:




	 	 	 	 	 
	 

	 	Blanket #1 —
	 	Personal Property
	 

	 	 	 	        $3,100,000 Replacement Costs, deductible 1%
	 
	 

	 	Blanket #1 —
	 	Business Income/Extra Expense
	 

	 	 	 	        $5,000,000, deductible 1%
	 
	 

	 	Inventory Spoilage
	 	10% of loss subject to min of $25,000
	 

	 	 	 	        whichever is greater — $4,000,000




Property coverage levels are reviewed annually and adjusted as necessary based on the value of all
tangible business property. The current coverage is bound until September 6, 2009. The term of
coverage will last until August           , 2011.



4. STATUS. Your status shall be listed on the insurance policy as Lienholder and/or Additional
Insured.




SIGNATURES FOR OWNER. By signing below, I agree to the terms contained in this Agreement and
acknowledge receipt of a copy of this Agreement.




OWNER:

RULES-BASED MEDICINE, INC.,

a Delaware corporation




	 	 	 	 	 
	By:  	 	 
	 	Patrick McClain, Chief Financial Officer 	 
	 	 	 



SIGNATURE OF SECURED PARTY.




SECURED PARTY:

COMPASS BANK




	 	 	 	 	 
	By:  	 	 
	 	Todd Jordan, Senior Vice President 	 
	 	 	 
	 





2











 







August ___, 2009





N O T I C E   O F    F I N A L    A G R E E M E N T






	TO:	 	 Borrower and All Other Obligors With Respect to the Loan Which Is Identified Below.
	 
	1.	 	THE WRITTEN LOAN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT
BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES.THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
	 
	2.	 	As used in this Notice:
	 
	 	 	Borrower means RULES-BASED MEDICINE, INC., a Delaware corporation.
	 
	 	 	Lender means COMPASS BANK, an Alabama state chartered bank.
	 
	 	 	Loan means the prospective loans by Lender which will create indebtedness
evidenced by, among other things, revolving promissory note in the stated principal amount
of $9,000,000.00 of even date herewith, signed by Borrower, and made payable to the order of
Lender.
	 
	 	 	Loan Agreement means one or more promises, promissory notes, loan agreements,
contractor/lender agreements, guaranty agreements, other agreements, undertakings, security
agreements, deeds of trust or other documents, or commitments, or any combination of those
actions or documents, relating to the Loan.
	 
	 	 	Parties means Lender and any one or more of Borrower, Guarantor, Owner and all
other obligors with respect to the Loan.
	 
	 	 	This Notice is given by Lender with respect to the Loan, pursuant to Section 26.02 of the
Texas Business and Commerce Code. Borrower and each other obligor with respect to the Loan
who signs below acknowledges, represents and warrants to Lender that Lender has given, and
such party has received and retained, a copy of this Notice on the Date of Notice stated
above.





	 	 	 	 	 	 	 
	LENDER:	 	BORROWER:
	COMPASS BANK	 	RULES-BASED MEDICINE, INC.,
	 	 	 	 	a Delaware corporation
	 
	 	 	 	 	 	 
	By:

	 	 	 	By:	 	 
	 

	 	 
	 	 	 	 
	 

	 	Todd Jordan, Senior Vice President
	 	 	 	Patrick McClain, Chief Financial Officer







1











 





	 	 	 	 	 
	 
	 	Clark, Thomas & Winters	 	 
	 
	 	A PROFESSIONAL CORPORATION	 	 
	TELEPHONE (512)472-8800
	 	POST OFFICE BOX 1148
	 	FAX (512) 474-1129
	 
	 	AUSTIN, TEXAS 78767	 	 
	 
	 	300 WEST 6th  STREET, 15TH FLOOR	 	 
	 
	 	AUSTIN, TEXAS 78701	 	 






August 6, 2009



Mr. Patrick McClain, Chief Financial Officer

Rules-Based Medicine, Inc.

3300 Duval Road

Austin, Texas 78759





RE: $9,000,000.00 Loan from Compass Bank


Dear Mr. McClain:




     I have represented Compass Bank in the preparation of legal documents for use in closing the
transactions described above.



     While I have acted solely on behalf of Compass Bank, the lender, Rules-Based Medicine, Inc.,
the borrower, acknowledges that the legal fees incurred in preparing the legal documents will be
paid for by the borrower even though I have not in any manner undertaken to assist or render legal
advice to the borrower, except in the preparation of the legal documents. The borrower further
acknowledges and understands that it may retain independent legal counsel to represent its
individual interests in the referenced transactions.



     The borrower specifically recognizes that I do not have the responsibility to provide any
truth-in-lending disclosures, any other truth-in-lending documents, or any other documents required
by any regulations that apply to these transactions. The lender is responsible for providing those
documents, and no charge may be made for providing them.



     Please sign below to acknowledge that you have been advised of my representation of the lender
and that you understand that I am not your attorney.



	 	 	 	 	 
	 	Sincerely yours,







W. Routt Thornhill

 	 
	 	 	 
	 	 	 
	 	 	 


DATED:
 August                   , 2009.



BORROWER:



RULES-BASED MEDICINE, INC.,





 









 








Clark,
Thomas & Winters

     A PROFESSIONAL CORPORATION




August 6, 2009

Page 2



a Delaware corporation




	 	 	 	 
	By:
	 	 	 
	 

	 

Patrick McClain, Chief Financial Officer