Exhibit
      10.40

     

    LOAN
      AGREEMENT

     

    Dated
      as
      of September 21, 2007

     

    by
      and
      between

     

    AGILITY
      CAPITAL, LLC

    as
      Agility

     

    and

     

    NORTH
      AMERICAN SCIENTIFIC, INC., a Delaware corporation
      and

    NORTH
      AMERICAN SCIENTIFIC, INC., a California corporation

    collectively,
      as Borrower

     

    TOTAL
      CREDIT AMOUNT: Up to $750,000

     

    
      	
              Maturity
                Date:

            	
              November
                20, 2007

            
	
              Formula:
                

            	
              None

            
	
              Facility
                Origination Fee: 

            	
              $20,000

            
	
              Interest:
                

            	
              Prime
                plus 6%, variable

            
	
              Warrants:

            	
              Described
                in the Warrant Document

            


    

    


    The
      information set forth above is subject to the terms and conditions set forth
      in
      the balance of this Agreement. The parties agree as follows:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    1. Advances
      and Payments.

     

    (a) Advances.
      Borrower
      may request one or more advances (each, an “Advance” and collectively, the
“Advances”), up to the following maximum outstanding amounts:

     

    
      	 	
              (i)

            	
              Advance
                in the principal amount of up to $500,000 upon the execution of all
                loan
                documents.

            


    

     

    
      	
            	(ii)	
              Advance
                of up to $250,000 upon receipt of a term sheet acceptable to Agility
                from
                a lead investor acceptable to Agility, in each case in its sole discretion
                in respect
                of a PIPE financing arranged by CIBC World Markets
                (“CIBC”).

            


    

     

    Agility’s
      obligation to make any Advance or Advances under this Agreement is subject
      to
      (i) Agility’s reasonable determination, in its sole discretion, that there has
      not occurred a circumstance or circumstances that have a Material Adverse
      Effect, and (ii) receipt of a subordination agreement and account control
      agreement from Silicon Valley Bank reasonably acceptable to Agility, (iii)
      receipt of Borrower’s engagement letter from CIBC and copies of the documents
      effecting the sale of Nomos Radiation Oncology, (iv) receipt of evidence of
      the
      termination of the financing statement of Partners for Growth, and (v) the
      execution, delivery and filing of such instruments and agreements, as Agility
      reasonably deems appropriate.

     

    (b) Interest.
      Borrower shall pay interest on the outstanding principal balance of the Advance
      and other monetary Obligations at a floating rate per annum equal to Six Percent
      (6.0%) above the Prime Rate quoted in The
      Wall Street Journal,
      to be
      adjusted from time to time as such rate changes. Interest shall be calculated
      on
      the basis of a 360-day year for the actual number of days elapsed, and shall
      be
      payable in arrears on the first day of each month. Any partial month shall
      be
      prorated on the basis of a 30-day month based on the actual number of days
      outstanding.

     

    (c) Fees.
      Borrower shall pay Agility an origination fee of $20,000 on the date of this
      Agreement, which may be net-funded from the first Advance. 

     

    (d) Warrants.
      Borrower is concurrently issuing to Agility a Warrant to Purchase Stock on
      the
      terms and conditions set forth therein (the “Warrant”).

     

    (e) Maturity
      Date.
      All
      amounts outstanding hereunder are due and payable on November 20, 2007 (the
      “Maturity Date”). Borrower may prepay all or any part of the Advance without
      penalty or premium.

     

    (f) Late
      Payment.
      Prior
      to the Maturity Date, if any payment of interest or any other amount owing
      to
      Agility is not made within ten (10) days after the due date, Borrower shall
      pay
      Agility a late payment fee equal to $1,000. If any amount is outstanding under
      this Agreement on the day after the Maturity Date, Borrower shall pay Agility
      a
      fee of $5,000. After the occurrence and during the continuance of an Event
      of
      Default, the Obligations shall bear interest at a rate equal to 18% per annum.
      The terms of this paragraph shall not be construed as Agility’s consent to
      Borrower’s failure to pay any amounts in strict accordance with this Agreement,
      and Agility’s charging any such fees and/or acceptance of any such payments
      shall not restrict Agility’s exercise of any remedies arising out of any such
      failure.

     

    2. Security
      Interest.
      As
      security for all present and future indebtedness, guarantees, liabilities,
      and
      other obligations of Borrower to Agility under this Agreement, including all
      fees specified in Section 1 (collectively, the “Obligations”), Borrower grants
      Agility a security interest in all of Borrower’s personal property, whether now
      owned or hereafter acquired, including without limitation the property described
      on Exhibit
      A
      attached
      hereto, and all products, proceeds and insurance proceeds of the foregoing
      (collectively, the “Collateral”). Borrower authorizes Agility to execute such
      documents and take such actions as Agility reasonably deems appropriate from
      time to time to perfect or continue the security interest granted
      hereunder.

     

    
      
        
        

      

      
        2.

        
          

        

      

      
        
        

      

    

     

    3. Representations
      and Warranties.
      Borrower represents to Agility as follows (which shall be deemed continuing
      throughout the term of this Agreement):

     

    (a) Authorization.
      Borrower is and will continue to be, duly organized, validly existing and in
      good standing under the laws of the jurisdiction of its incorporation, and
      Borrower is and will continue to be qualified and licensed to do business in
      all
      jurisdictions in which it is required to do so; the execution, delivery and
      performance by Borrower of this Agreement, and all other documents contemplated
      hereby have been duly and validly authorized by all necessary corporate action,
      and do not violate Borrower’s Articles of Incorporation or by-laws, or any law
      or any material agreement or instrument which is binding upon Borrower or its
      property. Borrower has no wholly owned or partially owned subsidiaries and
      is
      not a partner or joint venturer in any partnership or joint
      venture.

     

    (b) State
      of Incorporation; Places of Business; Locations of
      Collateral.
      Borrower is a corporation incorporated and in good standing under the laws
      of
      the state of its incorporation, as corporation number _________. The address
      set
      forth in this Agreement under Borrower’s signature is Borrower’s chief executive
      office. Other than the chief executive office, the Collateral is located at
      the
      address(es) set forth on Exhibit
      B.

     

    (c) Title
      to Collateral; Permitted Liens.
      Borrower is now, and will at all times in the future be, the sole owner of
      all
      the Collateral. The Collateral now is and will remain free and clear of any
      and
      all liens, security interests, encumbrances and adverse claims, except for
      (i) purchase money security interests in specific items of Equipment;
      (ii) leases of specific items of Equipment; (iii) liens for taxes,
      fees, assessments or other governmental charges or levies, either not delinquent
      or being contested in good faith by appropriate proceedings, provided the same
      have no priority over any of Agility’s security interests; (iv) liens of
      materialmen, mechanics, warehousemen, carriers, or other similar liens arising
      in the ordinary course of business and securing obligations that are not
      delinquent; (v) the first priority security interest of Silicon Valley Bank;
      and
      (vi) those liens set forth Exhibit
      B.

     

    (d) Financial
      Condition, Statements and Reports.
      The
      financial statements provided to Agility by Borrower have been prepared in
      accordance with generally accepted accounting principles, consistently applied
      (“GAAP”). All financial statements now or in the future delivered to Agility
      will fairly reflect the financial condition of Borrower, at the times and for
      the periods therein stated. Between the last date covered by any such statement
      provided to Agility and the date hereof, there has been no circumstance that
      could constitute or give rise to a Material Adverse Effect. Borrower has timely
      filed, and will timely file, all tax returns and reports required by applicable
      law, and Borrower has timely paid, and will timely pay, all applicable taxes,
      assessments, deposits and contributions now or in the future owed by Borrower.
      

     

    (e) Compliance
      with Law.
      Borrower has complied, and will comply, in all material respects, with all
      provisions of all applicable laws and regulations.

     

    (f) Information.
      All
      information provided to Agility by or on behalf of Borrower on or prior to
      the
      date of this Agreement is true and correct in all material respects, and no
      representation or other statement made by Borrower to Agility contains any
      untrue statement of a material fact or omits to state a material fact necessary
      to make any statements made to Agility not misleading at the time
      made.

     

    
      
        
        

      

      
        3.

        
          

        

      

      
        
        

      

    

     

    (g) Litigation.
      Except
      as disclosed on Exhibit
      B,
      there
      is no claim or litigation pending or (to best of Borrower’s knowledge)
      threatened against Borrower. Borrower will promptly inform Agility in writing
      of
      any claim or litigation in the future which, either separately or in the
      aggregate.

     

    (h) Subsidiaries.
      Except
      as disclosed on Exhibit
      B,
      Borrower has no wholly-owned or partially owned subsidiaries and Exhibit B
      sets
      forth all loans by Borrower to, and all investments by Borrower in, any person,
      entity, corporation partnership or joint venture.

     

    (i) Deposit
      and Investment Accounts.
      Borrower maintains only the operating, savings, deposit, securities and
      investment accounts listed on Exhibit
      B.
      

     

    4. Covenants.

     

    (a) Reports.
      Borrower will provide to Agility in form and substance acceptable to Agility
      (i)  monthly unaudited financial statements, prepared in accordance with
      GAAP, consistently applied, within thirty (30) days after the last day of each
      month; (ii) within fifteen (15) days after the last day of each month, copies
      of
      all reports and statements received by Borrower from any of its banks or other
      financial institutions (in lieu of such requirement, Borrower may grant Agility
      on-line “view only” access to all of its accounts on terms acceptable to
      Agility); (iii) annual audited financial statements prepared in accordance
      with GAAP, consistently applied, together with an unqualified upon thereon
      of an
      independent certified public accountant, and copies of Borrower’s tax returns
      for such year, within one hundred twenty (120) days of the last day of such
      year; (iv) copies of borrowing base and compliance certificates and financial
      statements that Borrower delivers to Silicon Valley Bank, when delivered to
      Silicon Valley Bank; and (v) upon request, such other information relating
      to
      Borrower’s operations and condition, including information on the status of any
      acquisitions or equity investments or sales of Borrower’s securities, as Agility
      may reasonably request from time to time. Agility shall have the right to audit
      and inspect the Collateral, from time to time, upon reasonable notice to
      Borrower. Agility or its officers, employees, or agents shall have a right
      to
      visit Borrower’s premises and interview Borrower’s officers at Borrower’s
      expense, such expense to be approved in advance by Borrower.

     

    (b) Insurance.
      Borrower will maintain insurance on the Collateral and Borrower’s business, in
      amounts and of a type that are customary to businesses similar to Borrower’s,
      and Agility will be named in a Agility’s loss payable endorsement in favor of
      Agility, in form reasonably acceptable to Agility.

     

    (c) Negative
      Covenants.
      Without
      Agility’s prior written consent, Borrower shall not do any of the following:
      (i) permit or suffer a merger, change of control, or acquisition of all or
      substantially all of Borrower’s assets other than in a transaction, the terms of
      which provide for immediate payment of all amounts outstanding under this
      Agreement; (ii) acquire any assets outside the ordinary course of business;
      (iii)  sell, lease, license, encumber or transfer any Collateral except for
      sales in the ordinary course of business and for sales of assets publicly
      announced prior to the date hereof (in which case Agility shall release its
      security interest in the part of the Collateral that is sold, effective
      immediately prior to such sale, but retains its security interest in the
      proceeds of such disposition); (iv) pay or declare any dividends on
      Borrower’s stock; (v) redeem, purchase or otherwise acquire, any of
      Borrower’s stock, except for stock from terminated employees or contractors, to
      the extent required or permitted under any employment or contractor agreements;
      (vi) make any investments in, or loans or advances to, any person,
      including without limitation any investments in, or downstreaming of funds
      to,
      any subsidiary or affiliate of Borrower; (vii)  incur any indebtedness,
      other than trade debt and capital lease obligations incurred in the ordinary
      course of business, and indebtedness of up to $3,000,000 to Silicon Valley
      Bank;
      (viii) make any payment on any of Borrower’s indebtedness that is subordinate to
      the Obligations, other than in accordance with the subordination agreement,
      if
      any, in favor of Agility relating thereto; (ix) make any deposits or investments
      into any investment or depository accounts unless they are subject to an account
      control agreement acceptable to Agility, or (x) agree to do any of the
      foregoing.

     

    
      
        
        

      

      
        4.

        
          

        

      

      
        
        

      

    

     

    5. Events
      of Default.
      Any one
      or more of the following shall constitute an Event of Default under this
      Agreement:

     

    (a) Borrower
      shall fail to pay any principal of or interest on any Loans or any other
      monetary Obligations within ten days after the date due; or

     

    (b) Borrower
      shall fail to comply with any other provision of this Agreement, which failure
      is not cured within ten days after the sooner of (i) the date that Borrower
      has
      knowledge of that failure or (ii) Borrower’s receipt of notice from Agility;
      or

     

    (c) Any
      warranty, representation, statement, report or certificate made or delivered
      to
      Agility by Borrower or on Borrower’s behalf shall be untrue or misleading in a
      material respect as of the date given or made, or shall become untrue or
      misleading in a material respect after the date hereof which cannot be corrected
      after notice to the satisfaction of Agility, acting reasonably; or

     

    (d) A
      default
      or event of default shall occur under any agreement to which Borrower is a
      party
      or by which it is bound (i) resulting in a right by the other party or parties,
      whether or not exercised, to accelerate the maturity of any indebtedness or
      (ii)
      that could have a Material Adverse Effect, as defined below; or

     

    (e) Any
      portion of Borrower’s assets is attached, seized or levied upon, or a judgment
      for more than $50,000 is awarded against Borrower and is not stayed within
      ten
      days; or

     

    (f) Dissolution
      or termination of existence of Borrower; or appointment of a receiver, trustee
      or custodian, for all or any material part of the property of, assignment for
      the benefit of creditors by, or the commencement of any proceeding by or against
      Borrower under any reorganization, bankruptcy, insolvency, arrangement,
      readjustment of debt, dissolution or liquidation law or statute of any
      jurisdiction, now or in the future in effect (except that, in the case of a
      proceeding commenced against Borrower, Borrower shall have 60 days after
      the date such proceeding was commenced to have it dismissed, provided Agility
      shall have no obligation to make any Loans during such period); or

     

    (g) The
      occurrence of a “Material Adverse Effect”, which shall mean (i) a material
      adverse change in the business, prospects, operations, results of operations,
      assets, liabilities or financial or other condition of Borrower, (ii) the
      material impairment of Borrower’s ability to perform its Obligations or of
      Agility’s ability to enforce the Obligations or realize upon the Collateral, or
      (iii) a material adverse change in the value of the
      Collateral.

     

    
      
        
        

      

      
        5.

        
          

        

      

      
        
        

      

    

     

    6. Remedies.

     

    (a) Remedies.
      Upon
      the occurrence and during the continuance of any Event of Default, Agility,
      at
      its option, may do any one or more of the following: (a) Accelerate and
      declare the Obligations to be immediately due, payable, and performable;
      (b) Take possession of any or all of the Collateral wherever it may be
      found, and for that purpose Borrower hereby authorizes Agility to enter
      Borrower’s premises without interference to search for, take possession of,
      keep, store, or remove any of the Collateral, and remain on the premises or
      cause a custodian to remain on the premises in exclusive control thereof,
      without charge by Borrower for so long as Agility reasonably deems it necessary
      in order to complete the enforcement of its rights under this Agreement or
      any
      other agreement; provided, however, that should Agility seek to take possession
      of any of the Collateral by Court process, Borrower hereby waives: (i) any
      bond and any surety or security relating thereto; (ii) any demand for
      possession prior to the commencement of any suit or action to recover possession
      thereof; and (iii) any requirement that Agility retain possession of, and
      not dispose of, any such Collateral until after trial or final judgment;
      (c) Require Borrower to assemble any or all of the Collateral and make it
      available to Agility at places designated by Agility; (d) Complete the
      processing of any Collateral prior to a disposition thereof and, for such
      purpose and for the purpose of removal, Agility shall have the right to use
      Borrower’s premises, equipment and all other property without charge by
      Borrower; (e) Collect and dispose of and realize upon any investment
      property, including withdrawal of any and all funds from any deposit or
      securities accounts; (f) Dispose of any of the Collateral, at one or more
      public or private sales, in lots or in bulk, for cash, exchange or other
      property, or on credit, and to adjourn any such sale from time to time without
      notice other than oral announcement at the time scheduled for sale; and
      (g) Demand payment of, and collect any accounts, general intangibles or
      other Collateral and, in connection therewith, Borrower irrevocably authorizes
      Agility to endorse or sign Borrower’s name on all collections, receipts,
      instruments and other documents, and, in Agility’s good faith business judgment,
      to grant extensions of time to pay, compromise claims and settle accounts,
      general intangibles and the like for less than face value; Borrower grants
      Agility a license, exercisable from and after an Event of Default has occurred,
      to use and copy any trademarks, service marks and other intellectual property
      in
      which Borrower has an interest to effect any of the foregoing remedies. All
      reasonable attorneys’ fees, expenses, costs, liabilities and obligations
      incurred by Agility with respect to the foregoing shall be added to and become
      part of the Obligations, and shall be due on demand.

     

    (b) Application
      of Proceeds.
      All
      proceeds realized as the result of any sale or other disposition of the
      Collateral shall be applied by Agility first to the reasonable costs, expenses,
      liabilities, obligations and attorneys’ fees incurred by Agility in the exercise
      of its rights under this Agreement, second to any fees and Obligations other
      than interest and principal, third to the interest due upon any of the
      Obligations, and fourth to the principal of the Obligations, in such order
      as
      Agility shall determine in its sole discretion. Any surplus shall be paid to
      Borrower or other persons legally entitled thereto; Borrower shall remain liable
      to Agility for any deficiency.

     

    (c) Remedies
      Cumulative.
      In
      addition to the rights and remedies set forth in this Agreement, Agility shall
      have all the other rights and remedies accorded a secured party under the
      California Uniform Commercial Code and under all other applicable laws, and
      under any other instrument or agreement now or in the future entered into
      between Agility and Borrower, and all of such rights and remedies are cumulative
      and none is exclusive. Exercise or partial exercise by Agility of one or more
      of
      its rights or remedies shall not be deemed an election, nor bar Agility from
      subsequent exercise or partial exercise of any other rights or remedies. The
      failure or delay of Agility to exercise any rights or remedies shall not operate
      as a waiver thereof, but all rights and remedies shall continue in full force
      and effect until all of the Obligations have been fully paid and
      performed.

     

    (d) Power
      of Attorney.
      After
      the occurrence and during the continuance of an Event of Default, Borrower
      irrevocably appoints Agility (and any of Agility’s designated employees or
      agents) as Borrower’s true and lawful attorney in fact to: endorse Borrower’s
      name on any checks or other forms of payment; make, settle and adjust all claims
      under and decisions with respect to Borrower’s policies of insurance; settle and
      adjust disputes and claims respecting accounts, general intangibles and other
      Collateral; execute and deliver all notices, instruments and agreements in
      connection with the perfection of the security interest granted in this
      Agreement; sell, lease or otherwise dispose of all or any part of the
      Collateral; and take any other action or sign any other documents required
      to be
      taken or signed by Borrower, or reasonably necessary to enforce Agility’s rights
      or remedies or otherwise carry out the purposes of this Agreement. The
      appointment of Agility as Borrower’s attorney in fact, and each of Agility’s
      rights and powers, being coupled with an interest, are irrevocable until all
      Obligations owing to Agility have been paid and performed in full.

     

    
      
        
        

      

      
        6.

        
          

        

      

      
        
        

      

    

     

    7. Exit
      Fee.
      If
      Borrower ceases to do business, or is dissolved, or liquidated, in each case
      before payment in full of the Obligations, Agility may require that Borrower
      pay
      Agility a fee equal to the greater of (i) $250,000 or (ii) the amount that
      Agility would have been entitled to receive in connection with such transaction
      had Agility exercised the Warrant immediately before the consummation of such
      transaction.

     

    8. Waivers.
      The
      failure of Agility at any time or times to require Borrower to strictly comply
      with any of the provisions of this Agreement or any other present or future
      agreement between Borrower and Agility shall not waive or diminish any right
      of
      Agility later to demand and receive strict compliance therewith. Any waiver
      of
      any default shall not waive or affect any other default, whether prior or
      subsequent, and whether or not similar. None of the provisions of this Agreement
      or any other agreement shall be deemed to have been waived except by a specific
      written waiver signed by an authorized officer of Agility. Borrower waives
      demand, protest, notice of protest and notice of default or dishonor, notice
      of
      payment and nonpayment, release, compromise, settlement, extension or renewal
      of
      any commercial paper, instrument, account, general intangible, document or
      guaranty at any time held by Agility on which Borrower is or may in any way
      be
      liable, and notice of any action taken by Agility, unless expressly required
      by
      this Agreement.

     

    9. Indemnity.
      Borrower shall indemnify Agility for any costs or liabilities, including
      reasonable attorneys’ fees, incurred by Agility in connection with this
      Agreement.

     

    10. Confidentiality.
      In
      handling any confidential non-public information provided to Agility by
      Borrower, Agility shall exercise the same degree of care that it exercises
      with
      respect to its own proprietary information of the same types to maintain the
      confidentiality of the same, except that disclosure of such information may
      be
      made (i) to subsidiaries or affiliates of Agility in connection with their
      present or prospective business relations with Borrower, (ii) to
      prospective transferees or purchasers of any interest in the Obligations,
      provided that they have entered into a comparable confidentiality agreement
      with
      respect thereto, (iii) as required by law, regulations, rule or order,
      subpoena, judicial order or similar order, (iv) as may be required in
      connection with the examination, audit or similar investigation of Agility,
      and
      (v) as Agility may deem appropriate in connection with the exercise of any
      remedies hereunder. Confidential information shall not include information
      that
      either: (a) is in the public domain, or becomes part of the public domain,
      after disclosure to Agility through no fault of Agility; or (b) is
      disclosed to Agility by a third party, provided Agility does not have actual
      knowledge that such third party is prohibited from disclosing such
      information.

     

    11. Governing
      Law; Jurisdiction; Venue.
      This
      Agreement and all acts and transactions hereunder and all rights and obligations
      of Agility and Borrower shall be governed by the internal laws (and not the
      conflict of laws rules) of the State of California. As a material part of the
      consideration to Agility to enter into this Agreement, Borrower (i) agrees
      that all actions and proceedings relating directly or indirectly to this
      Agreement shall, at Agility’s option, be litigated in courts located within
      California, and that the exclusive venue therefor shall be Santa Barbara County;
      (ii) consents to the jurisdiction and venue of any such court and consents
      to service of process in any such action or proceeding by personal delivery
      or
      any other method permitted by law; and (iii) waives any and all rights
      Borrower may have to object to the jurisdiction of any such court, or to
      transfer or change the venue of any such action or proceeding.

     

    
      
        
        

      

      
        7.

        
          

        

      

      
        
        

      

    

     

    12. MUTUAL
      WAIVER OF JURY TRIAL BORROWER AND AGILITY EACH WAIVE THE RIGHT TO TRIAL BY
      JURY
      IN ANY ACTION OR PROCEEDING BASED UPON, ARISING OUT OF, OR IN ANY WAY RELATING
      TO, THIS AGREEMENT OR ANY OTHER PRESENT OR FUTURE INSTRUMENT OR AGREEMENT
      BETWEEN AGILITY AND BORROWER, OR ANY CONDUCT, ACTS OR OMISSIONS OF AGILITY
      OR
      BORROWER OR ANY OF THEIR DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, ATTORNEYS
      OR
      ANY OTHER PERSONS AFFILIATED WITH AGILITY OR BORROWER, IN ALL OF THE FOREGOING
      CASES, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE.
      IF
      THIS JURY WAIVER IS FOR ANY REASON UNENFORCEABLE, THE PARTIES AGREE TO RESOLVE
      ALL CLAIMS, CAUSES AND DISPUTES THROUGH JUDICIAL REFERENCE PURSUANT TO CODE
      OF
      CIVIL PROCEDURE SECTION 638 ET SEQ BEFORE A MUTUALLY ACCEPTABLE REFEREE SITTING
      WITHOUT A JURY OR, IF NO AGREEMENT ON THE REFEREE IS REACHED, BEFORE A REFEREE
      SELECTED BY THE PRESIDING JUDGE OF THE CALIFORNIA SUPERIOR COURT FOR SANTA
      BARBARA COUNTY. THIS PROVISION SHALL NOT RESTRICT A PARTY FROM EXERCISING
      NONJUDICIAL REMEDIES UNDER THE CODE.

     

    13. Co-Borrowers.
      Solely
      for purposes of this Section 13, NORTH AMERICAN SCIENTIFIC, INC., a Delaware
      corporation and NORTH AMERICAN SCIENTIFIC, INC., a California corporation are
      each referred to individually, as a “Borrower” and, collectively, the
“Borrowers”.

     

    (a) Co-Borrowers.
      Borrowers are jointly and severally liable for the Obligations and Agility
      may
      proceed against one Borrower to enforce the Obligations without waiving its
      right to proceed against the other Borrower. This Agreement and the Loan
      Documents are a primary and original obligation of each Borrower and shall
      remain in effect notwithstanding future changes in conditions, including any
      change of law or any invalidity or irregularity in the creation or acquisition
      of any Obligations or in the execution or delivery of any agreement between
      Agility and any Borrower. Each Borrower shall be liable for existing and future
      Obligations as fully as if all of the Advance was advanced to such Borrower.
      Agility may rely on any certificate or representation made by any Borrower
      as
      made on behalf of, and binding on, all Borrowers. Each Borrower appoints each
      other Borrower as its agent with all necessary power and authority to give
      and
      receive notices, certificates or demands for and on behalf of both Borrowers,
      to
      act as disbursing agent for receipt of any loans on behalf of each Borrower
      and
      to apply to Agility on behalf of each Borrower for the Advance, any waivers
      and
      any consents. This authorization cannot be revoked, and Agility need not inquire
      as to one Borrower’s authority to act for or on behalf of another
      Borrower.

     

    (b) Subrogation
      and Similar Rights. Each
      Borrower irrevocably waives, until all Obligations are satisfied, all rights
      that it may have at law or in equity (including, without limitation, any law
      subrogating the Borrower to the rights of Agility under the Loan Documents)
      to
      seek contribution, indemnification, or any other form of reimbursement from
      any
      other Borrower, or any other Person now or hereafter primarily or secondarily
      liable for any of the Obligations, for any payment made by the Borrower with
      respect to the Obligations in connection with the Loan Documents or otherwise
      and all rights that it might have to benefit from, or to participate in, any
      security for the Obligations as a result of any payment made by the Borrower
      with respect to the Obligations in connection with the Loan Documents or
      otherwise. Any agreement providing for indemnification, reimbursement or any
      other arrangement prohibited under this Section shall be null and void. If
      any
      payment is made to a Borrower in contravention of this Section, such Borrower
      shall hold such payment in trust for Agility and such payment shall be promptly
      delivered to Agility for application to the Obligations, whether matured or
      unmatured.

     

    
      
        
        

      

      
        8.

        
          

        

      

      
        
        

      

    

     

    (c) Waivers
      of Notice. Each
      Borrower waives, to the extent permitted by law, notice of acceptance hereof;
      notice of the existence, creation or acquisition of any of the Obligations;
      notice of an Event of Default except as set forth herein; notice of the amount
      of the Obligations outstanding at any time; notice of any adverse change in
      the
      financial condition of any other Borrower or of any other fact that might
      increase the Borrower’s risk; presentment for payment; demand; protest and
      notice thereof as to any instrument; and all other notices and demands to which
      the Borrower would otherwise be entitled by virtue of being a co-borrower or
      a
      surety. Each Borrower waives any defense arising from any defense of any other
      Borrower, or by reason of the cessation from any cause whatsoever of the
      liability of any other Borrower. Agility’s failure at any time to require strict
      performance by any Borrower of any provision of the Loan Documents shall not
      waive, alter or diminish any right of Agility thereafter to demand strict
      compliance and performance therewith. Each Borrower also waives any defense
      arising from any act or omission of Agility that changes the scope of the
      Borrower’s risks hereunder. Each Borrower hereby waives any right to assert
      against Agility any defense (legal or equitable), setoff, counterclaim, or
      claims that such Borrower individually may now or hereafter have against another
      Borrower or any other Person liable to Agility with respect to the Obligations
      in any manner or whatsoever.

     

    (d) Subrogation
      Defenses.
      Until
      all Obligations are paid in full and Agility has no further obligation to make
      Credit Extensions to Borrowers, each Borrower hereby waives any defense based
      on
      impairment or destruction of its subrogation or other rights against any other
      Borrower and waives all benefits which might otherwise be available to it under
      California Civil Code Sections 2809, 2810, 2819, 2839, 2845, 2848, 2849, 2850,
      2899, and 3433 and California Code of Civil Procedure Sections 580a, 580b,
      580d
      and 726, as those statutory provisions are now in effect and hereafter amended,
      and under any other similar statutes now and hereafter in effect.

     

    (e) Right
      to Settle, Release.

     

    (i) The
      liability of Borrowers hereunder shall not be diminished by (i) any agreement,
      understanding or representation that any of the Obligations is or was to be
      guaranteed by another Person or secured by other property, or (ii) any release
      or unenforceability, whether partial or total, of rights, if any, which Agility
      may now or hereafter have against any other Person, including another Borrower,
      or property with respect to any of the Obligations.

     

    (ii) Without
      notice to any given Borrower and without affecting the liability of any given
      Borrower hereunder, Agility may (i) compromise, settle, renew, extend the time
      for payment, change the manner or terms of payment, discharge the performance
      of, decline to enforce, or release all or any of the Obligations with respect
      to
      any other Borrower by written agreement with such other Borrower, (ii) grant
      other indulgences to another Borrower in respect of the Obligations, (iii)
      modify in any manner any documents relating to the Obligations with respect
      to
      any other Borrower by written agreement with such other Borrower, (iv) release,
      surrender or exchange any deposits or other property securing the Obligations,
      whether pledged by a Borrower or any other Person, or (v) compromise, settle,
      renew, or extend the time for payment, discharge the performance of, decline
      to
      enforce, or release all or any obligations of any guarantor, endorser or other
      Person who is now or may hereafter be liable with respect to any of the
      Obligations.

     

    (f) Subordination.
      All
      indebtedness of a Borrower now or hereafter arising held by another Borrower
      is
      subordinated to the Obligations and the Borrower holding the indebtedness shall
      take all actions reasonably requested by Agility to effect, to enforce and
      to
      give notice of such subordination.

     

    
      
        
        

      

      
        9.

        
          

        

      

      
        
        

      

    

     

    14. General.
      This
      Agreement and such other written agreements, documents and instruments as may
      be
      executed in connection herewith are the final, entire and complete agreement
      between Borrower and Agility and supersede all prior and contemporaneous
      negotiations and oral representations and agreements, all of which are merged
      and integrated in this Agreement. There are no oral understandings,
      representations or agreements between the parties which are not set forth in
      this Agreement or in other written agreements signed by the parties in
      connection herewith. The terms and provisions of this Agreement may not be
      waived or amended, except in a writing executed by Borrower and a duly
      authorized officer of Agility. Agility may assign all or any part of its
      interest in this Agreement and the Obligations to any person or entity, or
      grant
      a participation in, or security interest in, any interest in this Agreement,
      with notice to, but without consent of, Borrower. Borrower may not assign any
      rights under or interest in this Agreement without Agility’s prior written
      consent. This Agreement may be executed in two or more counterparts, each of
      which shall be deemed an original, but all of which shall constitute one
      agreement.

     

    15. Publicity.
      Borrower
      authorizes Agility to use Borrower’s tradenames and logos in Agility’s marketing
      materials in respect of the transactions evidenced by this
      Agreement.

     

    
      	
              AGILITY
                CAPITAL, LLC

            	 	
              NORTH
                AMERICAN

              SCIENTIFIC,
                INC.

            	 	
              NORTH
                AMERICAN

              SCIENTIFIC,
                INC.

            
	 	 	 	 	 	 	 	 
	
              By:
                

            	
              /s/Jeffrey
                Carmody

            	 	
              By:

            	
              /s/James
                W. Klingler

            	 	
              By:

            	
              /s/James
                W. Klingler

            
	
              Title:

            	
              Chief
                Operating Officer

            	 	
              Title:

            	
              Sr.VP
                & CFO

            	 	
              Title:

            	
              Sr.VP
                & CFO

            


    

    


    
      	
              Address
                for notices:

            	
              Address
                for notices:

            	
              Address
                for notices:

            
	 	 	 
	
              Agility
                Capital, LLC

              226
                E. Canon Perdido Street, Suite F

              Santa
                Barbara, CA 93101

              Attn:
                Jeff Carmody

              Fax:
                805-568-0427

            	
              North
                American Scientific, Inc.

              20200
                Sunburst Street

              Chatsworth,
                CA 91311

              Attn:
                James Klingler

              Fax:
                (818)
                734-5223

            	
              North
                American Scientific, Inc.

              20200
                Sunburst Street

              Chatsworth,
                CA 91311

              Attn:
                James Klingler

              Fax:
                (818)
                734-5223

            


    

    


    
      
        
        

      

      
        10.

        
          

        

      

      
        
        

      

    

    


    Exhibit
      A

    COLLATERAL
      DESCRIPTION ATTACHMENT

    TO
      LOAN AND SECURITY AGREEMENT

    


    All
      personal property of Borrower (herein referred to as “Borrower” or “Debtor”)
      whether presently existing or hereafter created or acquired, and wherever
      located, including, but not limited to:

     

    (a)
       all
      accounts (including health-care-insurance receivables), chattel paper (including
      tangible and electronic chattel paper), deposit accounts, documents (including
      negotiable documents), equipment (including all accessions and additions
      thereto), general intangibles (including copyrights, patents, trademarks,
      goodwill and all intellectual property, payment intangibles and software),
      goods
      (including fixtures), instruments (including promissory notes), inventory
      (including all goods held for sale or lease or to be furnished under a contract
      of service, and including returns and repossessions), investment property
      (including securities and securities entitlements), letter of credit rights,
      money, and all of Debtor’s books and records with respect to any of the
      foregoing, and the computers and equipment containing said books and records;
      and 

     

    (b)
       any
      and
      all cash proceeds and/or noncash proceeds of any of the foregoing, including,
      without limitation, insurance proceeds, and all supporting obligations and
      the
      security therefor or for any right to payment. All terms above have the meanings
      given to them in the California Uniform Commercial Code, as amended or
      supplemented from time to time.

     

    The
      property sold pursuant to a sale announced before the date of this Agreement
      will be released from the security interest granted under this Agreement
      immediately before consummation of that sale, provided Collateral will include
      all proceeds of that sale.

     

    
      
        
        

      

      
        11.

        
          

        

      

      
        
        

      

    

     

    Exhibit
      B

     

    Places
      of
      Business and Locations of Collateral (Section 3(b)):


     

    Permitted
      Liens (Section 3(c))


     

    Litigation
      (Section 3(h)):


     

    Subsidiaries
      and partnerships and joint ventures (Section 3(i)):


     

    Accounts
      (Section 3(j))

     

    
      
        
        

      

      
        12.