occurred but which is not specifically referenced in this Agreement, nor shall it obligateAgent or any Lender to provide any waiver of, or other accommodation with respect to, any othersuch failure (whether similar or dissimilar, including, without limitation, (i) a failure to complywith Section 6.03 and/or Section 9.01(d) of the Credit Agreement, (ii) any Events of Defaultresulting from a final non-appealable judgment from a court of competent jurisdiction upholdingand/or affirming (or failing to overturn or reverse in full) the Application Denial and/or (iii)any other actions taken by or on behalf of any Governmental Authority, including, withoutlimitation, DHCS or any intermediary against the Borrowers, or any of them, including, withoutlimitation, any action or request seeking repayment, disgorgement or recoupment of any amounts paidby or on behalf of DHCS or any intermediary or imposing any fines or penalties as a result of, orin connection with, the Application Denial).     2. Default. Upon the effectiveness of this Agreement, the following shall constitutean Event of Default under the Credit Agreement: any request or demand for repayment, recoupment ordisgorgement in an amount in excess of $2,000,000 relating to, or in connection with, theApplication Denial is paid, made, requested or assessed against any Loan Party; provided, that,such request, demand or assessment is based on a final non-appealable judgment, determination orfinding from a court or other Governmental Authority (including, without limitation, DHCS or anyintermediary).     3. Representations and Warranties. Each Borrower represents and warrants to Agent andeach Lender that:          (a) Assuming the effectiveness of this Agreement, all warranties and representations made toLender under the Credit Agreement and the Loan Documents are true and correct as to the datehereof.          (b) Except for the enrollment in MediCal for BioMed CA and the related matter regarding achange of ownership in connection with the Target Merger that has been consolidated with it(“**BioMed MediCal Matter**”), each Borrower that seeks reimbursement under Medicare or Medicaid iscurrently enrolled and participates in the Medicare and state Medicaid programs of thejurisdictions in which such Borrower operates.          (c) No penalty, sanction, fine or restriction has been currently assessed or imposed upon anyBorrower, nor has any claim for repayment, disgorgement or recoupment of amounts paid to or onbehalf of BioMed CA or any other Borrower been asserted or threatened, in connection with orrelated to the BioMed MediCal Matter or any other matter, in each case which could reasonably beexpected to have a Material Adverse Effect.          (d) Neither the BioMed MediCal Matter, nor any fine, sanction or penalty that may be hereafterimposed (should BioMed CA be unsuccessful in its appeal of the Application Denial) if paid orsuccessfully appealed, has negatively affected or impaired, or would reasonably be likely tonegatively affect or impair: (i) any Permit for any of BioMed CA’s pharmacies or the Permit of anyother pharmacy, supplier or provider owned, managed or operated by any of the Borrowers or itsAffiliates or (ii) the right or ability of BioMed CA or any other pharmacy, supplier or providerowned, managed or operated by any of the Borrowers or its Affiliates to participate in Medicare,any state Medicaid program or any other payor program in which such Borrower currently
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participates in or may, in the future participate in, or otherwise participated in on theClosing Date, in either case, which could reasonably be expected to have a Material Adverse Effect.          (e) Except for the BioMed MediCal Matter, there is no pending or, to Borrowers’ knowledge,threatened, action or proceeding challenging or contesting any Permit or right of any of theBorrowers to participate in Medicare, any state Medicaid program or any other payor program andBorrowers are not aware of any facts or events that would give any governmental agency the right orauthority to contest or challenge any of the foregoing, in each case, which could reasonably beexpected to have a Material Adverse Effect.          (f) The execution and delivery by each Borrower of this Agreement, and all other documents,instruments, and agreements executed in connection with this Agreement and the performance by it ofthe transactions herein contemplated, (i) are and will be within its powers, (ii) have beenauthorized by all necessary organizational action, and (iii) are not and will not be incontravention of any order of any court or other agency of government, of law or any otherindenture, agreement or undertaking to which such Borrower is a party or by which the property ofsuch Borrower is bound, or be in conflict with, result in a breach of, or constitute (with duenotice and/or lapse of time) a default under any such indenture, agreement or undertaking or resultin the imposition of any lien, charge or encumbrance of any nature on any of the properties of suchBorrower.          (g) This Agreement, all other documents, instruments and agreements executed in connectionwith this Agreement and any assignment, instrument, document, or agreement executed and deliveredin connection herewith, will be valid, binding, and enforceable in accordance with its respectiveterms, except as enforceability may be limited by applicable Debtor Relief Laws or by equitableprinciples relating to enforceability.          (h) Assuming the effectiveness of this Agreement, no Default or Event of Default has occurredand is continuing under the Credit Agreement or any of the other Loan Documents.     4. Effectiveness Conditions. This Agreement shall be effective upon satisfaction ofthe following conditions precedent (all documents to be in form and substance satisfactory to Agentand Agent’s counsel in its sole and absolute discretion):          (a) Execution and delivery by Borrowers of this Agreement;          (b) No Default or Event of Default after giving effect hereto shall have occurred and becontinuing under the Credit Documents;          (c) All warranties and representations made to Lender under the Credit Agreement, the LoanDocuments and hereunder are true and correct as to the date hereof; and          (d) Payment by Borrowers of any and all costs, fees and expenses of Agent (including, withoutlimitation, reasonable attorneys’ fees) in connection with this Agreement and the transactioncontemplated hereby.     5. Default. Without limiting the terms of the Credit Agreement and for avoidance ofdoubt, it shall be an Event of Default under the Credit Agreement if (a) any representation or
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warranty made by Borrowers, or any of them, in this Agreement shall be incorrect or misleadingin any material respect at any time made or deemed made or (b) Borrowers, or any of them, fail toperform or observe any covenant or agreement set forth in this Agreement.     6. Confirmation of Indebtedness. Borrowers hereby acknowledge and confirm that as ofthe close of business on March 5, 2009, Borrowers are indebted to Agent and Lenders, withoutdefense, setoff, claim or counterclaim under the Loan Documents, in the aggregate principal amountof $51,946,346.74, comprised of (a) $17,821,346.74 with respect to the Revolving Loans and (b)$34,125,000.00 with respect to the Term Loan plus all fees, costs and expenses (includingattorneys’ fees) incurred to date in connection with, and as payable under the Loan Documents.     7. Ratification of Credit Documents. Except as expressly set forth herein, all of theterms and conditions of the Credit Agreement and Loan Documents are hereby ratified and confirmedand continue unchanged and in full force and effect. All references to the Credit Agreement shallmean the Credit Agreement as modified by this Agreement.     8. Collateral. Each Borrower hereby confirms and agrees that all security interestsand liens granted to Agent, for the benefit of Lenders, continue in full force and effect and shallcontinue to secure the Obligations.     9. Release. As further consideration for Agent’s and Lenders’ agreement to grant theaccommodations set forth herein, Borrowers hereby waive and release and forever discharge Agent andeach Lender and each of their respective officers, directors, attorneys, agents and employees(collectively, “**Released Parties**”) from any liability, damage, claim, loss or expense of any kindthat Borrowers, or any of them, may now or hereafter have against the Released Parties, or any ofthem, arising out of or relating to the Obligations, this Agreement, the Credit Agreement or theLoan Documents, but only to the extent of any circumstance, action, cause or matter arising at anytime on or prior to the date that this Agreement is executed by all parties.     10. Governing Law. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIESHERETO SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORKWITHOUT REGARD TO ANY CONFLICTS OF LAWS PRINCIPLES THEREOF THAT WOULD CALL FOR THE APPLICATION OFTHE LAWS OF ANY OTHER JURISDICTION.     11. **Waiver of Right to Trial by Jury**. EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLYWAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDERTHIS AGREEMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIESHERETO OR ANY OF THEM WITH RESPECT TO ANY CREDIT DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, INEACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OROTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSEOF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAYFILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THECONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
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     12. Signatories: Each individual signatory hereto represents and warrants that he orshe is duly authorized to execute this Agreement on behalf of his or her principal and that he orshe executes the Agreement in such capacity and not as a party.     13. Duplicate Originals: Two or more duplicate originals of this Agreement may besigned by the parties, each of which shall be an original but all of which together shallconstitute one and the same instrument. This Agreement may be executed in counterparts, all ofwhich counterparts taken together shall constitute one completed fully executed document.Signature by facsimile or PDF shall bind the parties hereto.
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     IN WITNESS WHEREOF, the parties have executed this Agreement the day and year first abovewritten.   **Borrowers:** **ALLION HEALTHCARE, INC.**