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                                                                   Exhibit 10.24

                           LOAN AND SECURITY AGREEMENT

         THIS LOAN AND SECURITY AGREEMENT (this "AGREEMENT") dated as of May 15,
2006 (the "EFFECTIVE DATE") between SILICON VALLEY BANK, a California
corporation and with a loan production office located at One Newton Executive
Park, Suite 200, 2221 Washington Street, Newton, Massachusetts 02462 ("BANK"),
and NXSTAGE MEDICAL, INC., a Delaware corporation ("BORROWER"), provides the
terms on which Bank shall lend to Borrower and Borrower shall repay Bank. The
parties agree as follows:

         1        ACCOUNTING AND OTHER TERMS

         Accounting terms not defined in this Agreement shall be construed
following GAAP. Calculations and determinations must be made following GAAP.
Capitalized terms not otherwise defined in this Agreement shall have the
meanings set forth in Section 13. All other terms contained in this Agreement,
unless otherwise indicated, shall have the meaning provided by the Code to the
extent such terms are defined therein.

         2        LOAN AND TERMS OF PAYMENT

         2.1 PROMISE TO PAY. Borrower hereby unconditionally promises to pay
Bank the outstanding principal amount of all Credit Extensions and accrued and
unpaid interest thereon as and when due in accordance with this Agreement.

         2.1.1    TERM ADVANCES.

                  (a) Availability. Subject to the terms and conditions of this
Agreement, during the Draw Period, Bank shall make advances (each, a "TERM
ADVANCE" and, collectively, "TERM ADVANCES") not exceeding the Term Line. Term
Advances may only be used to finance Eligible Products, and no Term Advance may
exceed 50% of the total direct purchase price of the Eligible Products being
financed, or, with respect to Eligible Products manufactured by Borrower, the
total direct product cost to manufacture. Notwithstanding the foregoing, the
initial Term Advance, which shall be requested by Borrower on the Effective
Date, shall be equal to an amount requested by Borrower, which shall not exceed
the aggregate of up to (i) any amount owed by Borrower or paid off by Borrower
in connection with the Lighthouse Agreements (inclusive of any prepayment
penalties, but in no event more than $3,460,000), and (b) 50% of the aggregate
amount of the Eligible Products deployed by Borrower on or after January 1, 2006
but prior to the Effective Date. After repayment, no Term Advance may be
reborrowed.

                  (b) Repayment. Each Term Advance is payable in: (i) thirty-six
(36) consecutive equal monthly installments of principal, calculated by the
Bank, based upon (A) the amount of the Term Advance, and (B) an amortization
schedule equal to thirty-six (36) months, plus (ii) interest on the outstanding
principal amount of the Term Advance at the rate set forth in Section 2.2(a),
beginning on the first Business Day of the calendar quarter following the
Funding Date of such Term Advance and continuing thereafter on the first
Business Day of each successive calendar month. All unpaid principal and accrued
interest is due and payable in full on the Maturity Date. Payments received
after 12:00 noon Eastern time are considered received at the opening of business
on the next Business Day. A Term Advance may only be prepaid in accordance with
Sections 2.1.1(c) and 2.1.1(d).

                  (c) Mandatory Prepayment Upon an Acceleration. If the Term
Advances are accelerated following the occurrence of an Event of Default,
Borrower shall immediately pay to Bank an amount equal to the sum of: (i) all
outstanding principal plus accrued interest, plus (ii) all other sums that shall
have become due and payable, including interest at the Default Rate with respect
to any past due amounts.

                  (d) Permitted Prepayment of Loans. Borrower shall have the
option to prepay at any time and from time to time, without premium or penalty,
any portion of the Term Advances advanced by Bank under this Agreement, provided
Borrower (i) provides written notice to Bank of its election to prepay such
amount at least seven (7) days prior to such prepayment, and (ii) pays, on the
date of such prepayment, all sums that shall have become due and payable.

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         2.2      PAYMENT OF INTEREST ON THE CREDIT EXTENSIONS.

                  (a) Interest Rate. Subject to Section 2.2(b), the principal
amount outstanding for each Term Advance shall accrue interest at a floating per
annum rate equal to one-half of one percentage point (0.50%) above the Prime
Rate, which interest shall be payable monthly in arrears.

                  (b) Default Rate. Immediately upon the occurrence and during
the continuance of an Event of Default, Obligations shall bear interest at a
rate per annum which is five percentage points above the rate effective
immediately before the Event of Default (the "DEFAULT RATE"). Payment or
acceptance of the increased interest rate provided in this Section 2.2(b) is not
a permitted alternative to timely payment and shall not constitute a waiver of
any Event of Default or otherwise prejudice or limit any rights or remedies of
Bank.

                  (c) Adjustment to Interest Rate. Changes to the interest rate
of any Credit Extension based on changes to the Prime Rate shall be effective on
the effective date of any change to the Prime Rate and to the extent of any such
change.

                  (d) 360-Day Year. Interest shall be computed on the basis of a
360-day year for the actual number of days elapsed.

                  (e) Debit of Accounts. Bank may debit any of Borrower's
deposit accounts with Bank, including the Designated Deposit Account, for (i)
principal and interest payments when due in accordance with this Agreement
without notice or (ii) any other amounts Borrower owes Bank when due in
accordance with this Agreement after Bank provides notice of such amounts. These
debits shall not constitute a set-off.

                  (f) Payments. Unless otherwise provided, interest is payable
monthly on the first calendar day of each month. Payments of principal and/or
interest received after 12:00 noon Eastern time are considered received at the
opening of business on the next Business Day. When a payment is due on a day
that is not a Business Day, the payment is due the next Business Day and
additional fees or interest, as applicable, shall continue to accrue.

         2.3      FEES.  Borrower shall pay to Bank:

                  (a) Commitment Fee. A fully earned, non-refundable commitment
fee of One Hundred Thousand Dollars ($100,000.00), on the Effective Date;

                  (b) Unused Term Line Facility Fee. A fee (the "UNUSED TERM
LINE FACILITY FEE"), payable quarterly, in arrears, on a calendar year basis, in
an amount equal to (i) for the calendar year of 2006, 0.50% per annum of the
average unused portion of the Term Line (for purposes of this provision, the
Term Line shall mean the $10,000,000 potentially available to Borrower on and
prior to December 31, 2006), as determined by Bank, (ii) also for the calendar
year of 2006, 0.10% per annum of the average unused portion of the Term Line
(for purposes of this provision, the Term Line shall mean the $10,000,000 only
potentially available to Borrower on and after January 1, 2007), as determined
by Bank, and (iii) for the calendar year of 2007, 0.50% per annum of the average
unused portion of the Term Line (for purposes of this provision, the Term Line
shall mean the $20,000,000 potentially available to Borrower), as determined by
Bank. Borrower shall not be entitled to any credit, rebate or repayment of any
Unused Term Line Facility Fee previously earned by Bank pursuant to this Section
notwithstanding any termination of the Agreement or the suspension or
termination in accordance with this Agreement of Bank's obligation to make loans
and advances hereunder; and

                  (c) Bank Expenses. All Bank Expenses (including reasonable
attorneys' fees and expenses, plus expenses, for documentation and negotiation
of this Agreement) incurred through and after the Effective Date, when due.

         3        CONDITIONS OF LOANS

         3.1 CONDITIONS PRECEDENT TO INITIAL CREDIT EXTENSION. Bank's obligation
to make the initial Credit Extension is subject to the condition precedent that
Bank shall have received, in form and substance satisfactory to Bank, such
documents, and completion of such other matters, as Bank may reasonably deem
necessary or appropriate, including, without limitation:

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                  (a) Duly executed original signatures to the Loan Documents to
which it is a party;

                  (b) Duly executed original signatures to the Control
Agreements with respect to each account maintained at a financial institution
other than Bank;

                  (c) Borrower shall have delivered its Operating Documents and
a good standing certificate of Borrower certified by the Secretary of State of
the State of Delaware as of a date no earlier than thirty (30) days prior to the
Effective Date;

                  (d) Duly executed original signatures to the completed
Borrowing Resolutions for Borrower;

                  (e) Borrower shall have delivered a payoff letter with respect
to the Lighthouse Agreements, which payoff letter includes the outstanding
amount owed to the lenders under the Lighthouse Agreements (along with a per
diem rate, if applicable), is addressed to Bank and Borrower, and authorizes
Bank and Borrower to terminate all UCC financing statements and all other liens
in favor of the lenders under the Lighthouse Agreements once such lenders are
repaid in full;

                  (f) Bank shall have received certified copies, dated as of a
recent date, of financing statement searches, as Bank shall request, accompanied
by written evidence (including any UCC termination statements) that the Liens
indicated in any such financing statements either constitute Permitted Liens or
have been or, in connection with the initial Credit Extension, will be
terminated or released;

                  (g)      Intentionally omitted;

                  (h) Borrower shall have delivered a legal opinion of
Borrower's counsel dated as of the Effective Date together with the duly
executed original signatures thereto;

                  (i) Borrower shall have delivered the insurance policies
and/or endorsements required pursuant to Section 6.5 hereof; and

                  (j) Borrower shall have paid the fees and Bank Expenses then
due as specified in Section 2.3 hereof.

         3.2 CONDITIONS PRECEDENT TO ALL CREDIT EXTENSIONS. Bank's obligations
to make each Credit Extension, including the initial Credit Extension, is
subject to the following:

                  (a) except as otherwise provided in Section 3.4, timely
receipt of an executed Payment/Advance Form;

                  (b) the representations and warranties in Section 5 shall be
true in all material respects on the date of the Payment/Advance Form and on the
Funding Date of each Credit Extension; provided, however, that such materiality
qualifier shall not be applicable to any representations and warranties that
already are qualified or modified by materiality in the text thereof; and
provided, further that those representations and warranties expressly referring
to a specific date shall be true, accurate and complete in all material respects
as of such date, and no Default or Event of Default shall have occurred and be
continuing or result from the Credit Extension. Each Credit Extension is
Borrower's representation and warranty on that date that the representations and
warranties in Section 5 remain true in all material respects; provided, however,
that such materiality qualifier shall not be applicable to any representations
and warranties that already are qualified or modified by materiality in the text
thereof; and provided, further that those representations and warranties
expressly referring to a specific date shall be true, accurate and complete in
all material respects as of such date; and

                  (c) there has not been any material impairment in the
business, operations, or condition (financial or otherwise) or the prospect of
repayment of the Obligations, or there has not been any material adverse
deviation by Borrower from the most recent business plan of Borrower presented
to and accepted by Bank.


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         3.3      COVENANT TO DELIVER.

         Borrower agrees to deliver to Bank each item required to be delivered
to Bank under this Agreement as a condition to any Credit Extension. Borrower
expressly agrees that the extension of a Credit Extension prior to the receipt
by Bank of any such item shall not constitute a waiver by Bank of Borrower's
obligation to deliver such item, and any such extension in the absence of a
required item shall be in Bank's sole discretion.

         3.4      PROCEDURES FOR BORROWING.

         Subject to the prior satisfaction of all other applicable conditions to
the making of a Term Advance set forth in this Agreement, to obtain a Term
Advance, Borrower must notify Bank (which notice shall be irrevocable) by
electronic mail or facsimile no later than 12:00 noon Eastern time one (1)
Business Day before the proposed Funding Date. The notice shall be a
Payment/Advance Form, must be signed by a Responsible Officer or designee, and
shall include confirmation acceptable to Bank of (i) total direct purchase price
of any Eligible Products being financed, or, with respect to Eligible Products
manufactured by Borrower, the total direct product cost to manufacture and (ii)
that such costs constitute Eligible Products.

         4        CREATION OF SECURITY INTEREST

         4.1 GRANT OF SECURITY INTEREST. Borrower hereby grants Bank, to secure
the payment and performance in full of all of the Obligations, a continuing
security interest in, and pledges to Bank, the Collateral, wherever located,
whether now owned or hereafter acquired or arising, and all proceeds and
products thereof. Borrower represents, warrants, and covenants that the security
interest granted herein is and shall at all times continue to be a first
priority perfected security interest in the Collateral (subject only to
Permitted Liens that may have superior priority to Bank's Lien under this
Agreement). If Borrower shall acquire a commercial tort claim having a
reasonably expected value in excess of One Hundred Thousand Dollars
($100,000.00) in the aggregate, Borrower shall promptly notify Bank in a writing
signed by Borrower of the general details thereof and grant to Bank in such
writing a security interest therein and in the proceeds thereof, all upon the
terms of this Agreement, with such writing to be in form and substance
reasonably satisfactory to Bank.

         If this Agreement is terminated, Bank's Lien in the Collateral shall
continue until the Obligations (other than inchoate indemnity obligations) are
repaid in full in cash. Upon payment in full in cash of the Obligations and at
such time as Bank's obligation to make Credit Extensions has terminated, Bank
shall, at Borrower's sole cost and expense, release its Liens in the Collateral
and all rights therein shall revert to Borrower.

         4.2 AUTHORIZATION TO FILE FINANCING STATEMENTS. Borrower hereby
authorizes Bank to file financing statements, without notice to Borrower, with
all appropriate jurisdictions to perfect or protect Bank's interest or rights
hereunder, including a notice that any disposition of the Collateral, by either
Borrower or any other Person, shall be deemed to violate the rights of Bank
under the Code.

         5        REPRESENTATIONS AND WARRANTIES

                  Borrower represents and warrants as follows:

         5.1 DUE ORGANIZATION AND AUTHORIZATION. Borrower and each of its
Subsidiaries are duly existing and in good standing, as Registered Organizations
in their respective jurisdictions of formation and are qualified and licensed to
do business and are in good standing in any jurisdiction in which the conduct of
their business or their ownership of property requires that they be qualified
except where the failure to do so could not reasonably be expected to have a
material adverse effect on Borrower's business. In connection with this
Agreement, Borrower has delivered to Bank a completed certificate signed by
Borrower (the "Perfection Certificate"). Borrower represents and warrants to
Bank that, except as may be set forth in any notice provided by Borrower after
the Effective Date (but only with respect to (a) through (d) below), (a)
Borrower's exact legal name is that indicated on the Perfection Certificate and
on the signature page hereof; (b) Borrower is an organization of the type and is
organized in the jurisdiction set forth in the Perfection Certificate; (c) the
Perfection Certificate accurately sets forth Borrower's organizational
identification number or accurately states that Borrower has none; (d) the
Perfection Certificate accurately sets forth Borrower's place of business, or,
if more than one, its chief executive office as well as Borrower's mailing
address (if different than its chief executive office); (e) except as in
accordance with Section 7.2, Borrower (and each of its predecessors) has not, in
the past five (5) years, changed its jurisdiction of formation,


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organizational structure or type, or any organizational number assigned by its
jurisdiction; and (f) all other information set forth on the Perfection
Certificate pertaining to Borrower and each of its Subsidiaries is accurate and
complete in all material respects. If Borrower is not now a Registered
Organization but later becomes one, Borrower shall promptly notify Bank of such
occurrence and provide Bank with Borrower's organizational identification
number.

         The execution, delivery and performance of the Loan Documents have been
duly authorized, and do not conflict with Borrower's organizational documents,
nor constitute an event of default under any material agreement by which
Borrower is bound. Borrower is not in default under any agreement to which it is
a party or by which it is bound in which the default could reasonably be
expected to have a material adverse effect on Borrower's business.

         5.2 COLLATERAL. Borrower has good title to, has rights in, and the
power to transfer each item of the Collateral upon which it purports to grant a
Lien hereunder, free and clear of any and all Liens except Permitted Liens.
Borrower has no deposit accounts other than the deposit accounts with Bank, the
deposit accounts, if any, described in the Perfection Certificate delivered to
Bank in connection herewith, or of which Borrower has given Bank notice and
taken such actions as are necessary to give Bank a perfected security interest
therein.

         The Collateral is not in the possession of any third party bailee (such
as a warehouse) except as otherwise provided in the Perfection Certificate or of
which Borrower has given Bank notice and is in compliance with this Section 5.2.
Notwithstanding the foregoing, Borrower shall deliver to Bank fully-executed
bailee's waivers from Kuehne & Nagel, Inc., KMC and Medisystems, each within
thirty (30) calendar days of the Effective Date. None of the components of the
Collateral shall be maintained at locations other than as provided in the
Perfection Certificate or as Borrower has given Bank notice pursuant to Section
7.2. In the event that Borrower, after the date hereof, intends to store or
otherwise deliver any portion of the Collateral to a bailee (provided that, for
clarity, this shall not apply to any of the Eligible Products which are in the
field with Borrower's customers/end users), then Borrower will first receive the
written consent of Bank and such bailee must execute and deliver a bailee
agreement in form and substance satisfactory to Bank in its sole discretion.

         All Inventory is in all material respects of good and marketable
quality, free from material defects.

         Borrower is the sole owner of its intellectual property, except for
non-exclusive licenses granted to its customers in the ordinary course of
business and any other Transfers permitted hereunder. Each patent which is
required or necessary for the operation of Borrower's business is valid and
enforceable, and no part of such intellectual property has been judged invalid
or unenforceable, in whole or in part, and to the best of Borrower's knowledge,
no claim has been made that any part of the intellectual property violates the
rights of any third party except to the extent such claim could not reasonably
be expected to have a material adverse effect on Borrower's business. Except as
noted on the Perfection Certificate, Borrower is not a party to, nor is bound
by, any material license or other agreement with respect to which Borrower is
the licensee that prohibits or otherwise restricts Borrower from granting a
security interest in Borrower's interest in such license or agreement or any
other property. Borrower shall provide written notice to Bank within ten (10)
days of entering or becoming bound by any such license or agreement which is
reasonably likely to have a material impact on Borrower's business or financial
condition (other than over-the-counter software that is commercially available
to the public). Borrower shall take such steps as Bank requests to obtain the
consent of, or waiver by, any person whose consent or waiver is necessary for
all such licenses or contract rights to be deemed "Collateral" and for Bank to
have a security interest in it that might otherwise be restricted or prohibited
by law or by the terms of any such license or agreement (such consent or
authorization may include a licensor's agreement to a contingent assignment of
the license to Bank if Bank determines that is necessary in its good faith
judgment), whether now existing or entered into in the future.

         5.3 LITIGATION. There are no actions or proceedings pending or, to the
knowledge of the Responsible Officers, threatened in writing by or against
Borrower or any of its Subsidiaries involving more than Two Hundred Fifty
Thousand Dollars ($250,000.00).

         5.4 NO MATERIAL DETERIORATION IN FINANCIAL STATEMENTS. All consolidated
financial statements for Borrower and any of its Subsidiaries delivered to Bank
fairly present in all material respects Borrower's consolidated financial
condition and Borrower's consolidated results of operations as of the date
thereof. There has not been any material deterioration in Borrower's
consolidated financial condition since the date of the most recent financial
statements submitted to Bank.


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         5.5 SOLVENCY. The fair salable value of Borrower's assets (including
goodwill minus disposition costs) exceeds the fair value of its liabilities;
Borrower is not left with unreasonably small capital after the transactions in
this Agreement; and Borrower is able to pay its debts (including trade debts) as
they mature.

         5.6 REGULATORY COMPLIANCE. Borrower is not an "investment company" or a
company "controlled" by an "investment company" under the Investment Company
Act. Borrower is not engaged as one of its important activities in extending
credit for margin stock (under Regulations T and U of the Federal Reserve Board
of Governors). Borrower has complied in all material respects with the Federal
Fair Labor Standards Act. Borrower has not violated any laws, ordinances or
rules, the violation of which could reasonably be expected to have a material
adverse effect on its business. None of Borrower's or any of its Subsidiaries'
properties or assets has been used by Borrower or any Subsidiary in disposing,
producing, storing, treating, or transporting any hazardous substance other than
legally. Borrower and each of its Subsidiaries have obtained all consents,
approvals and authorizations of, made all declarations or filings with, and
given all notices to, all government authorities that are necessary to continue
its business as currently conducted.

         5.7 SUBSIDIARIES; INVESTMENTS. Borrower does not own any stock,
partnership interest or other equity securities except for Permitted
Investments.

         5.8 TAX RETURNS AND PAYMENTS; PENSION CONTRIBUTIONS. Borrower has
timely filed all required tax returns and reports, and Borrower and its
Subsidiaries have timely paid all foreign, federal, state and local taxes,
assessments, deposits and contributions owed by Borrower, unless the same are
being contested in good faith. Borrower may defer payment of any contested
taxes, provided that Borrower (a) in good faith contests its obligation to pay
the taxes by appropriate proceedings promptly and diligently instituted and
conducted, (b) notifies Bank in writing of the commencement of, and any material
development in, the proceedings with respect to amounts in excess of Two Hundred
Fifty Thousand Dollars ($250,000.00) in the aggregate, (c) posts bonds or takes
any other steps required to prevent the governmental authority levying such
contested taxes from obtaining a Lien upon any of the Collateral that is other
than a "Permitted Lien". Borrower is unaware of any claims or adjustments
proposed for any of Borrower's prior tax years which could reasonably be
expected to result in additional taxes in excess of Two Hundred Fifty Thousand
Dollars ($250,000.00) in the aggregate becoming due and payable by Borrower.
Borrower has paid all amounts necessary to fund all present pension, profit
sharing and deferred compensation plans in accordance with their terms, and
Borrower has not withdrawn from participation in, and has not permitted partial
or complete termination of, or permitted the occurrence of any other event with
respect to, any such plan which could reasonably be expected to result in any
liability of Borrower, including any liability to the Pension Benefit Guaranty
Corporation or its successors or any other governmental agency.

         5.9 USE OF PROCEEDS. Borrower shall use the proceeds of the Credit
Extensions solely to reimburse Borrower for the direct purchase price of
Eligible Products and to repay obligations under the Lighthouse Agreements.

         5.10 EIR MEDICAL, INC. EIR Medical, Inc. Borrower's wholly-owned
Subsidiary, does not and will not have assets with an aggregate value of greater
than Twenty Thousand Dollars ($20,000.00), other than cash and securities in
accounts maintained at Bank or SVB Securities.

         5.11 FULL DISCLOSURE. No written representation, warranty or other
statement of Borrower in any certificate or written statement given to Bank, as
of the date such representations, warranties, or other statements were made,
taken together with all such written certificates and written statements given
to Bank, contains any untrue statement of a material fact or omits to state a
material fact necessary to make the statements contained in the certificates or
statements not misleading (it being recognized by Bank that the projections and
forecasts provided by Borrower in good faith and based upon reasonable
assumptions are not viewed as facts and that actual results during the period or
periods covered by such projections and forecasts may differ from the projected
or forecasted results).

         6        AFFIRMATIVE COVENANTS

         Borrower shall do all of the following:

         6.1 GOVERNMENT COMPLIANCE. Maintain its and all its Subsidiaries' legal
existence and good standing in their respective jurisdictions of formation and
maintain qualification in each jurisdiction in which the failure to so qualify
would reasonably be expected to have a material adverse effect on Borrower's
business or operations. Borrower shall comply, and have each Subsidiary comply,
with all laws, ordinances and regulations to


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which it is subject, the noncompliance with which could reasonably be expected
to have a material adverse effect on Borrower's business.

         6.2      FINANCIAL STATEMENTS, REPORTS, CERTIFICATES.

                  (a) Deliver to Bank: (i) as soon as available, but no later
than forty-five (45) days after the last day of each quarter (other than the
last quarter of each fiscal year), a company prepared consolidated balance sheet
and income statement covering Borrower's consolidated operations during the
period certified by a Responsible Officer and in a form acceptable to Bank; (ii)
as soon as available, but no later than one hundred twenty (120) days after the
last day of Borrower's fiscal year, audited consolidated financial statements
prepared under GAAP, consistently applied, together with an unqualified opinion
on the financial statements from an independent certified public accounting firm
acceptable to Bank in its reasonable discretion; (iii) within five (5) days of
delivery, copies of all statements, reports and notices made available to
Borrower's security holders or to any holders of Subordinated Debt; (iv) in the
event that Borrower becomes subject to the reporting requirements under the
Securities Exchange Act of 1934, as amended, within five (5) days of filing, all
reports on Form 10-K, 10-Q and 8-K filed with the Securities and Exchange
Commission or a link thereto on Borrower's or another website on the internet
(provided, for clarity, to the extent that any such filing is available on the
publicly accessible website for the Securities and Exchange Commission, nothing
additional needs to be provided); (v) a prompt report of any legal actions
pending or threatened against Borrower or any of its Subsidiaries that could
reasonably be expected to result in damages or costs to Borrower or any of its
Subsidiaries of Fifty Thousand Dollars ($50,000.00) or more; (vi) Board
projections, annually and as updated, promptly following Board approval, but in
any event no later than January 31 of the subject year; and (vii) budgets, sales
projections, operating plans and other financial information reasonably
requested by Bank.

                  (b) Within fifteen (15) days after the last day of each month,
deliver to Bank an aged listing of accounts receivable (by invoice date).

                  (c) Within fifteen (15) days after the last day of each month,
deliver to Bank a duly completed Compliance Certificate signed by a Responsible
Officer setting forth calculations showing compliance with the financial
covenants set forth in this Agreement.

                  (d) Allow Bank to audit Borrower's Collateral at Borrower's
expense; provided that such audits shall be conducted no more often than once
every twelve (12) months unless an Event of Default has occurred and is
continuing.

         6.3 INVENTORY; RETURNS. Keep all Inventory in good and marketable
condition, free from material defects. Returns and allowances between Borrower
and its Account Debtors shall follow Borrower's customary practices as they
exist at the Effective Date. Borrower must promptly notify Bank of all returns,
recoveries, disputes and claims that involve more than Two Hundred Fifty
Thousand Dollars ($250,000.00).

         6.4 TAXES; PENSIONS. Make, and cause each of its Subsidiaries to make,
timely payment of all foreign, federal, state, and local taxes or assessments
(other than taxes and assessments which Borrower is contesting pursuant to the
terms of Section 5.8 hereof) and shall deliver to Bank, on demand, appropriate
certificates attesting to such payments, and pay all amounts necessary to fund
all present pension, profit sharing and deferred compensation plans in
accordance with their terms.

         6.5 INSURANCE. Keep its business and the Collateral insured for risks
and in amounts standard for companies in Borrower's industry and location and as
Bank may reasonably request. All property policies shall have a loss payable
endorsement showing Bank as the sole loss payee and waive subrogation against
Bank, and all liability policies shall show, or have endorsements showing, Bank
as an additional insured. All policies (or the loss payable and additional
insured endorsements) shall provide that the insurer must give Bank at least
twenty (20) days notice before canceling, amending, or declining to renew its
policy. At Bank's request, Borrower shall deliver certified copies of policies
and evidence of all premium payments. Proceeds payable under any policy shall,
at Bank's option, be payable to Bank on account of the Obligations.
Notwithstanding the foregoing, (a) so long as no Event of Default has occurred
and is continuing, Borrower shall have the option of applying the proceeds of
any casualty policy up to One Million Dollars ($1,000,000.00), in the aggregate,
toward the replacement or repair of destroyed or damaged property; provided that
any such replaced or repaired property (i) shall be of equal or like value as
the replaced or repaired Collateral and (ii) shall be deemed Collateral in which
Bank has been granted a first priority security interest, and (b) after the
occurrence and during the continuance of an Event of Default, all


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proceeds payable under such casualty policy shall, at the option of Bank, be
payable to Bank on account of the Obligations. If Borrower fails to obtain
insurance as required under this Section 6.5 or to pay any amount or furnish any
required proof of payment to third persons and Bank, Bank may make all or part
of such payment or obtain such insurance policies required in this Section 6.5,
and take any action under the policies Bank deems prudent.

         6.6      OPERATING ACCOUNTS.

                  (a) As of the date that is seven (7) calendar days after the
Effective Date, and thereafter, maintain its primary operating accounts with
Bank. In addition, as of the date that is seven (7) calendar days after the
Effective Date, and thereafter, Borrower's domestic Subsidiaries shall maintain
their domestic operating accounts with Bank. In addition, as a condition to the
Bank making any Term Advance after the initial Term Advance to refinance the
obligations under the Lighthouse Agreements, Borrower shall maintain
unrestricted cash or securities at Bank or SVB Securities, in an amount equal or
greater than Three Million Four Hundred Sixty Thousand Dollars ($3,460,000.00)
in the aggregate, and shall continue to maintain such minimum amount as long as
such Term Advance or Term Advances are outstanding, provided that, on the
earlier of September 30, 2006 and the Capitalization Event, such minimum amount
(inclusive of the $3,460,000.00 referenced above) shall be an amount equal to or
greater than the greater of (i) Ten Million Dollars ($10,000,000.00), and (ii)
the aggregate amount of outstanding Obligations. Borrower may maintain
non-primary operating accounts and securities accounts with other financial
institutions, provided that Borrower complies with the foregoing, and subject to
Section 6.6(b) below.

                  (b) Provide Bank five (5) days prior written notice before
establishing any Collateral Account at or with any bank or financial institution
other than Bank or its Affiliates. In addition, for each Collateral Account that
Borrower at any time maintains, Borrower shall cause the applicable bank or
financial institution (other than Bank) at or with which any Collateral Account
is maintained to execute and deliver a Control Agreement or other appropriate
instrument with respect to such Collateral Account to perfect Bank's Lien in
such Collateral Account in accordance with the terms hereunder. The provisions
of the previous sentence shall not apply to (i) deposit accounts exclusively
used for payroll, payroll taxes and other employee wage and benefit payments to
or for the benefit of Borrower's employees and identified to Bank by Borrower as
such, or (ii) accounts with Comerica (provided that the exclusion in (ii) shall
only apply until the date that is seven (7) calendar days after the Effective
Date).

         6.7      FINANCIAL COVENANTS.

                  Borrower shall maintain at all times, to be tested as of the
last day of each quarter, unless otherwise noted:

                  (a) Liquidity Coverage. To be tested as of the last day of
each month, a ratio of (a) unrestricted cash plus an amount equal to eighty
percent (80.0%) of Borrower's Eligible Accounts to (b) the outstanding
Obligations plus an amount equal to two (2) times the aggregate of Borrower's
quarterly net loss for the most recent quarter then ended and Borrower's capital
expenditures which are not financed by Bank, of greater than 1.00:1.00.

                  (b) Maximum Net Losses; Minimum Net Profit. Borrower shall not
negatively vary from the net loss/net profit requirements set forth below for
the six-month period ending with the last day of each calendar quarter,
beginning with the calendar quarter ending March 31, 2006, through the Maturity
Date (each a "Testing Period"). (i) Borrower shall not suffer any net loss in
excess of: (A) $18,388,200 for the Testing Period ending March 31, 2006, (B)
$22,356,000 for the Testing Period ending June 30, 2006, (C) $22,795,200 for the
Testing Period ending September 30, 2006, (D) $21,088,800 for the Testing Period
ending December 31, 2006, and (E) for the Testing Period ending March 31, 2007
and for the Testing Period ending on the last day of each calendar quarter
thereafter, $22,039,200. (ii) In addition, without limiting the provisions in
(i) above, if the Board approved plan (including any updates or revisions
thereto) for any Testing Period (including the specific dates referenced above):
(A) projects a net profit, Borrower's net profit for such period shall not be
less than eighty percent (80.0%) of the Board approved plan for net profit for
such Testing Period, and (B) projects a net loss, Borrower's net loss for such
Testing Period shall not be greater than (1) $22,039,200, or (2) one-hundred
twenty percent (120%) of the Board approved plan for net loss for such Testing
Period.

                  (c) Patient Count. Borrower must have a number of Patients, as
of the last day of each quarter, of at least (i) 357 as of the quarter ending
March 31, 2006, (ii) 561 as of the quarter ending June 30, 2006, (iii) 830 as of
the quarter ending September 30, 2006, (iv) 1,019 as of the quarter ending
December 31, 2006, (v) as


                                      -8-
<PAGE>

of the quarter ending March 31, 2007 and as of the last day of each quarter
ending thereafter, an amount equal to eighty percent (80.0%) of the Board
approved plan with respect to Borrower's Patient count.

         6.8 LITIGATION COOPERATION. From the date hereof and continuing through
the termination of this Agreement, make available to Bank, without expense to
Bank, Borrower and its officers, employees and agents and Borrower's books and
records, to the extent that Bank may deem them reasonably necessary to prosecute
or defend any third-party suit or proceeding instituted by or against Bank with
respect to any Collateral or relating to Borrower.

         6.9 ASSET OWNERSHIP. From the date hereof and continuing through the
termination of this Agreement, at least eighty-five percent (85.0%) of the
assets owned by Borrower and its Subsidiaries shall be owned by and in the name
of Borrower.

         6.10 FURTHER ASSURANCES. Borrower shall execute any further instruments
and take further action as Bank reasonably requests to perfect or continue
Bank's Lien in the Collateral or to effect the purposes of this Agreement.

         7 NEGATIVE COVENANTS

         Borrower shall not do any of the following without Bank's prior written
consent:

         7.1 DISPOSITIONS. Convey, sell, lease, transfer or otherwise dispose of
(collectively, "Transfer"), or permit any of its Subsidiaries to Transfer, all
or any part of its business or property, except for Transfers (a) of Inventory
in the ordinary course of business; (b) of worn-out or obsolete Equipment that
does not constitute Eligible Products; (c) in connection with Permitted Liens
and Permitted Investments; (d) of non-exclusive licenses for the use of the
property of Borrower or its Subsidiaries in the ordinary course of business; (e)
the sale and/or factoring of Borrower's accounts receivable and any security or
collateral provided by such account debtor relating to the specific receivables
sold or factored; and (f) either (i) in the ordinary course of Borrower's
business for fair consideration, Eligible Products to end users, provided that
new Eligible Products of equal value are placed in service with new Patients, or
(ii) Eligible Products to end users for an amount equal to the unamortized
portion of the Term Advance made based upon such Eligible Product, as calculated
and determined by Bank in its reasonable discretion. Borrower shall not enter
into an agreement with any Person other than Bank which restricts the subsequent
granting of a security interest in the Intellectual Property.

         7.2 CHANGES IN BUSINESS, MANAGEMENT, OWNERSHIP, CONTROL, OR BUSINESS
LOCATIONS. (a) Engage in or permit any of its Subsidiaries to engage in any
business other than the businesses currently engaged in by Borrower and such
Subsidiary, as applicable, or reasonably related thereto (it being understood
that all renal replacement and fluid overload businesses are reasonably related
thereto); or (b) liquidate or dissolve. Borrower shall not, without at least
thirty (30) days prior written notice to Bank: (1) add any new offices or
business locations, including Borrower-owned warehouses (unless such new offices
or business locations contain less than Ten Thousand Dollars ($10,000.00) in
Borrower's assets or property), (2) change its jurisdiction of organization, (3)
change its organizational structure or type, (4) change its legal name, or (5)
change any organizational number (if any) assigned by its jurisdiction of
organization.

         7.3 MERGERS OR ACQUISITIONS. Merge or consolidate, or permit any of its
Subsidiaries to merge or consolidate, with any other Person, or acquire, or
permit any of its Subsidiaries to acquire, all or substantially all of the
capital stock or property of another Person. A Subsidiary may merge or
consolidate into another Subsidiary or into Borrower.

         7.4 INDEBTEDNESS. Create, incur, assume, or be liable for any
Indebtedness, or permit any Subsidiary to do so, other than Permitted
Indebtedness.

         7.5 ENCUMBRANCE. Create, incur, or allow any Lien on any of its
property, or assign or convey any right to receive income, including the sale of
any Accounts (except as provided in Section 7.1), or permit any of its
Subsidiaries to do so, except for Permitted Liens, permit any Collateral not to
be subject to the first priority security interest granted herein, or enter into
any agreement, document, instrument or other arrangement (except with or in
favor of Bank) with any Person which directly or indirectly prohibits or has the
effect of prohibiting Borrower or any Subsidiary from assigning, mortgaging,
pledging, granting a security interest in or upon, or encumbering any of

                                      -9-
<PAGE>

Borrower's or any Subsidiary's intellectual property, except as is otherwise
permitted in Section 7.1 hereof and the definition of "Permitted Lien" herein.

         7.6 MAINTENANCE OF COLLATERAL ACCOUNTS. Maintain any Collateral Account
except pursuant to the terms of Section 6.6.(b) hereof.

         7.7 DISTRIBUTIONS; INVESTMENTS. (a) Directly or indirectly make any
Investment other than Permitted Investments, or permit any of its Subsidiaries
to do so; or (b) pay any dividends or make any distribution or payment or
redeem, retire or purchase any capital stock, provided that (i) Borrower may
convert any of its convertible securities into other securities pursuant to the
terms of such convertible securities or otherwise in exchange thereof, (ii)
Borrower may pay dividends solely in common stock, and (iii) Borrower may
repurchase the stock of former employees or consultants pursuant to stock
repurchase agreements so long as an Event of Default does not exist at the time
of such repurchase and would not exist after giving effect to such repurchase,
provided such repurchases do not exceed One Hundred Thousand Dollars
($100,000.00) in the aggregate per fiscal year.

         7.8 TRANSACTIONS WITH AFFILIATES. Directly or indirectly enter into or
permit to exist any material transaction with any Affiliate of Borrower, except
for transactions (i) that are upon fair and reasonable terms that are no less
favorable to Borrower than would be obtained in an arm's length transaction with
a non-affiliated Person, or (ii) that are disclosed in filings with the
Securities and Exchange Commission.

         7.9 SUBORDINATED DEBT. (a) Make or permit any payment on any
Subordinated Debt, except under the terms of the subordination, intercreditor,
or other similar agreement to which such Subordinated Debt is subject, or (b)
amend any provision in any document relating to the Subordinated Debt which
would increase the amount thereof or adversely affect the subordination thereof
to Obligations owed to Bank.

         7.10 COMPLIANCE. Become an "investment company" or a company controlled
by an "investment company", under the Investment Company Act of 1940 or
undertake as one of its important activities extending credit to purchase or
carry margin stock (as defined in Regulation U of the Board of Governors of the
Federal Reserve System), or use the proceeds of any Credit Extension for that
purpose; fail to meet the minimum funding requirements of ERISA, permit a
Reportable Event or Prohibited Transaction, as defined in ERISA, to occur; fail
to comply with the Federal Fair Labor Standards Act or violate any other law or
regulation, if the violation could reasonably be expected to have a material
adverse effect on Borrower's business, or permit any of its Subsidiaries to do
so; withdraw or permit any Subsidiary to withdraw from participation in, permit
partial or complete termination of, or permit the occurrence of any other event
with respect to, any present pension, profit sharing and deferred compensation
plan which could reasonably be expected to result in any liability of Borrower,
including any liability to the Pension Benefit Guaranty Corporation or its
successors or any other governmental agency.

         8 EVENTS OF DEFAULT

         Any one of the following shall constitute an event of default (an
"EVENT OF DEFAULT") under this Agreement:

         8.1 PAYMENT DEFAULT. Borrower fails to (a) make any payment of
principal or interest on any Credit Extension on its due date, or (b) pay any
other Obligations within three (3) Business Days after such Obligations are due
and payable (which three day grace period will not apply to payments due on the
Maturity Date). During the cure period, the failure to cure the payment default
is not an Event of Default (but no Credit Extension will be made during the cure
period);

         8.2 COVENANT DEFAULT.

                  (a) Borrower fails or neglects to perform any obligation in
Sections 6.2, 6.6, 6.7, or violates any covenant in Section 7; or

                  (b) Borrower fails or neglects to perform, keep, or observe
any other term, provision, condition, covenant or agreement in any material
respect contained in this Agreement, any Loan Documents, and as to any default
(other than those specified in this Section 8 below) under such other term,
provision, condition, covenant or agreement that can be cured, has failed to
cure the default within ten (10) days after the occurrence thereof; provided,
however, that if the default cannot by its nature be cured within the ten (10)
day period or cannot after

                                      -10-
<PAGE>

diligent attempts by Borrower be cured within such ten (10) day period, and such
default is likely to be cured within a reasonable time, then Borrower shall have
an additional period (which shall not in any case exceed thirty (30) days) to
attempt to cure such default, and within such reasonable time period the failure
to cure the default shall not be deemed an Event of Default (but no Credit
Extensions shall be made during such cure period). Grace periods provided under
this section shall not apply, among other things, to financial covenants or any
other covenants set forth in subsection (a) above;

         8.3 MATERIAL ADVERSE CHANGE. A Material Adverse Change occurs;

         8.4 ATTACHMENT. (a) Any material portion of Borrower's assets is
attached, seized, levied on, or comes into possession of a trustee or receiver
and the attachment, seizure or levy is not removed in ten (10) days; (b) the
service of process upon Bank (or Bank's Affiliate) in excess of One Hundred
Thousand Dollars ($100,000.00) in the aggregate seeking to attach, by trustee or
similar process, any funds of, or of any entity under control of Borrower
(including a Subsidiary) on deposit with the Bank; (c) Borrower is enjoined,
restrained, or prevented by court order from conducting a material part of its
business; (d) a final judgment or other claim becomes a Lien on any of
Borrower's assets; (e) a judgment or other claim in excess of Two Hundred Fifty
Thousand Dollars ($250,000.00) becomes a Lien on any of Borrower's assets; or
(f) a notice of lien, levy, or assessment is filed against any of Borrower's
assets by any government agency and not paid within ten (10) days after Borrower
receives notice. These are not Events of Default if stayed or if a bond is
posted pending contest by Borrower (but no Credit Extensions shall be made
during the cure period);

         8.5 INSOLVENCY (a) Borrower is unable to pay its debts (including trade
debts) as they become due or otherwise becomes insolvent; (b) Borrower begins an
Insolvency Proceeding; or (c) an Insolvency Proceeding is begun against Borrower
and not dismissed or stayed within forty-five (45) days (but no Credit
Extensions shall be made while of any of the conditions described in clause (a)
exist and/or until any Insolvency Proceeding is dismissed);

         8.6 OTHER AGREEMENTS. There is a default in any agreement to which
Borrower is a party with a third party or parties resulting in a right by such
third party or parties, whether or not exercised, to accelerate the maturity of
any Indebtedness in an amount in excess of Two Hundred Fifty Thousand Dollars
($250,000.00) or that could reasonably be expected to have a material adverse
effect on Borrower's business;

         8.7 JUDGMENTS. A final judgment or judgments for the payment of money
in an amount, individually or in the aggregate, of at least Two Hundred Fifty
Thousand Dollars ($250,000.00) (not covered by independent third-party
insurance) shall be rendered against Borrower and shall remain unsatisfied and
unstayed for a period of ten (10) days after the entry thereof (provided that no
Credit Extensions will be made prior to the satisfaction or stay of such
judgment);

         8.8 MISREPRESENTATIONS. Borrower or any Person acting for Borrower
makes any representation, warranty, or other statement now or later in this
Agreement, any Loan Document or in any writing delivered to Bank or to induce
Bank to enter this Agreement or any Loan Document, and such representation,
warranty, or other statement is incorrect in any material respect when made;

         8.9 SUBORDINATED DEBT. A default or breach occurs under any agreement
for borrowed money between Borrower and any creditor of Borrower that signed a
subordination, intercreditor, or other similar agreement with Bank involving
amounts in excess of Two Hundred Fifty Thousand Dollars ($250,000.00) in the
aggregate, or any creditor that has signed such an agreement with Bank breaches
any terms of such agreement; or

         8.10 RESERVED.

         9 BANK'S RIGHTS AND REMEDIES

         9.1 RIGHTS AND REMEDIES. While an Event of Default occurs and continues
Bank may, without notice or demand, do any or all of the following:

                  (a) declare all Obligations immediately due and payable (but
if an Event of Default described in Section 8.5 occurs all Obligations are
immediately due and payable without any action by Bank);


                                      -11-
<PAGE>

                  (b) stop advancing money or extending credit for Borrower's
benefit under this Agreement or under any other agreement between Borrower and
Bank;

                  (c) settle or adjust disputes and claims directly with Account
Debtors for amounts on terms and in any order that Bank considers advisable,
notify any Person owing Borrower money of Bank's security interest in such
funds, and verify the amount of such account;

                  (d) make any payments and do any acts it considers necessary
or reasonable to protect the Collateral and/or its security interest in the
Collateral. Borrower shall assemble the Collateral if Bank requests and make it
available as Bank designates. Bank may enter premises where the Collateral is
located, take and maintain possession of any part of the Collateral, and pay,
purchase, contest, or compromise any Lien which appears to be prior or superior
to its security interest and pay all expenses incurred. Borrower grants Bank a
license to enter and occupy any of its premises, without charge, to exercise any
of Bank's rights or remedies;

                  (e) apply to the Obligations any (i) balances and deposits of
Borrower it holds, or (ii) any amount held by Bank owing to or for the credit or
the account of Borrower;

                  (f) ship, reclaim, recover, store, finish, maintain, repair,
prepare for sale, advertise for sale, and sell the Collateral. To the extent not
in violation of any applicable and enforceable agreements requiring the consent
of third parties who own or have rights to the following, Bank is hereby granted
a non-exclusive, royalty-free license or other right to use, without charge,
Borrower's labels, patents, copyrights, mask works, rights of use of any name,
trade secrets, trade names, trademarks, service marks, and advertising matter,
or any similar property as it pertains to the Collateral, in completing
production of, advertising for sale, and selling any Collateral and, in
connection with Bank's exercise of its rights under this Section, Borrower's
rights under all licenses and all franchise agreements inure to Bank's benefit;

                  (g) place a "hold" on any account maintained with Bank and/or
deliver a notice of exclusive control, any entitlement order, or other
directions or instructions pursuant to any Control Agreement or similar
agreements providing control of any Collateral;

                  (h) demand and receive possession of Borrower's Books; and

                  (i) exercise all rights and remedies available to Bank under
the Loan Documents or at law or equity, including all remedies provided under
the Code (including disposal of the Collateral pursuant to the terms thereof).

         9.2 POWER OF ATTORNEY. Borrower hereby irrevocably appoints Bank as its
lawful attorney-in-fact, exercisable upon the occurrence and during the
continuance of an Event of Default, to: (a) endorse Borrower's name on any
checks or other forms of payment or security; (b) sign Borrower's name on any
invoice or bill of lading for any Account or drafts against Account Debtors; (c)
settle and adjust disputes and claims about the Accounts directly with Account
Debtors, for amounts and on terms Bank determines reasonable; (d) make, settle,
and adjust all claims under Borrower's insurance policies; (e) pay, contest or
settle any Lien, charge, encumbrance, security interest, and adverse claim in or
to the Collateral, or any judgment based thereon, or otherwise take any action
to terminate or discharge the same; and (f) transfer the Collateral into the
name of Bank or a third party as the Code permits. Borrower hereby appoints Bank
as its lawful attorney-in-fact to sign Borrower's name on any documents
necessary to perfect or continue the perfection of Bank's security interest in
the Collateral regardless of whether an Event of Default has occurred until all
Obligations have been satisfied in full and Bank is under no further obligation
to make Credit Extensions hereunder. Bank's foregoing appointment as Borrower's
attorney in fact, and all of Bank's rights and powers, coupled with an interest,
are irrevocable until all Obligations have been fully repaid and performed and
Bank's obligation to provide Credit Extensions terminates.

         9.3 ACCOUNTS VERIFICATION; COLLECTION. After an Event of Default has
occurred and is continuing, Bank may notify any Person owing Borrower money of
Bank's security interest in such funds and verify the amount of such account.
After the occurrence of an Event of Default, any amounts received by Borrower
shall be held in trust by Borrower for Bank, and, if requested by Bank, Borrower
shall immediately deliver such receipts to Bank in the form received from the
Account Debtor, with proper endorsements for deposit.


                                      -12-
<PAGE>

         9.4 PROTECTIVE PAYMENTS. If Borrower fails to obtain the insurance
called for by Section 6.5 or fails to pay any premium thereon or fails to pay
any other amount which Borrower is obligated to pay under this Agreement or any
other Loan Document, Bank may obtain such insurance or make such payment, and
all amounts so paid by Bank are Bank Expenses and immediately due and payable,
bearing interest at the then highest applicable rate, and secured by the
Collateral. Bank will make reasonable efforts to provide Borrower with notice of
Bank obtaining such insurance at the time it is obtained or within a reasonable
time thereafter. No payments by Bank are deemed an agreement to make similar
payments in the future or Bank's waiver of any Event of Default.

         9.5 APPLICATION OF PAYMENTS AND PROCEEDS. Unless an Event of Default
has occurred and is continuing, Bank shall apply any funds in its possession,
whether from Borrower account balances, payments, or proceeds realized as the
result of any collection of Accounts or other disposition of the Collateral,
first, to Bank Expenses, including without limitation, the reasonable costs,
expenses, liabilities, obligations and attorneys' fees incurred by Bank in the
exercise of its rights under this Agreement; second, to the interest due upon
any of the Obligations; and third, to the principal of the Obligations and any
applicable fees and other charges, in such order as Bank shall determine in its
sole discretion. Any surplus shall be paid to Borrower or other Persons legally
entitled thereto; Borrower shall remain liable to Bank for any deficiency. If an
Event of Default has occurred and is continuing, Bank may apply any funds in its
possession, whether from Borrower account balances, payments, proceeds realized
as the result of any collection of Accounts or other disposition of the
Collateral, or otherwise, to the Obligations in such order as Bank shall
determine in its sole discretion. Any surplus shall be paid to Borrower or other
Persons legally entitled thereto; Borrower shall remain liable to Bank for any
deficiency.

         9.6 BANK'S LIABILITY FOR COLLATERAL. So long as Bank complies with
reasonable banking practices regarding the safekeeping of the Collateral in the
possession or under the control of Bank, Bank shall not be liable or responsible
for: (a) the safekeeping of the Collateral; (b) any loss or damage to the
Collateral; (c) any diminution in the value of the Collateral; or (d) any act or
default of any carrier, warehouseman, bailee, or other Person. Borrower bears
all risk of loss, damage or destruction of the Collateral.

         9.7 NO WAIVER; REMEDIES CUMULATIVE. Bank's failure, at any time or
times, to require strict performance by Borrower of any provision of this
Agreement or any other Loan Document shall not waive, affect, or diminish any
right of Bank thereafter to demand strict performance and compliance herewith or
therewith. No waiver hereunder shall be effective unless signed by Bank and then
is only effective for the specific instance and purpose for which it is given.
Bank's rights and remedies under this Agreement and the other Loan Documents are
cumulative. Bank has all rights and remedies provided under the Code, by law, or
in equity. Bank's exercise of one right or remedy is not an election, and Bank's
waiver of any Event of Default is not a continuing waiver. Bank's delay in
exercising any remedy is not a waiver, election, or acquiescence.

         9.8 DEMAND WAIVER. Borrower waives demand, notice of default or
dishonor, notice of payment and nonpayment, notice of any default, nonpayment at
maturity, release, compromise, settlement, extension, or renewal of accounts,
documents, instruments, chattel paper, and guarantees held by Bank on which
Borrower is liable.

         10 NOTICES

         All notices, consents, requests, approvals, demands, or other
communication (collectively, "Communication") by any party to this Agreement or
any other Loan Document must be in writing and shall be deemed to have been
validly served, given, or delivered: (a) upon the earlier of actual receipt and
three (3) Business Days after deposit in the U.S. mail, first class, registered
or certified mail return receipt requested, with proper postage prepaid and
properly addressed; (b) upon transmission, when sent by electronic mail or
facsimile transmission to the correct email address or facsimile number; (c) one
(1) Business Day after deposit with a reputable overnight courier with all
charges prepaid and properly addressed; or (d) when delivered, if hand-delivered
by messenger, all of which shall be addressed to the party to be notified and
sent to the address, facsimile number, or email address indicated below. Bank or
Borrower may change its address or facsimile number by giving the other party
written notice thereof in accordance with the terms of this Section 10.


                                      -13-
<PAGE>

                  If to Borrower:    NXSTAGE MEDICAL, INC.
                                     439 S. Union Street, 5th Floor
                                     Lawrence, Massachusetts 01843
                                     Attn:  Chief Financial Officer or
                                     Vice President and Corporate
                                     Controller
                                     Fax: (978) 687-4847
                                     Email: jhuber@nxstage.com

                  with a copy to:    General Counsel of Borrower at the
                                     above address (and at the email
                                     address of wswan@nxstage.com);

                                     and to

                                     Wilmer Cutler Pickering Hale and Dorr LLP
                                     60 State Street
                                     Boston, Massachusetts 02109
                                     Attn: Mitchel Appelbaum
                                     Fax: (617) 526-5000
                                     Email: mitchel.appelbaum@wilmerhale.com

                  If to Bank:        Silicon Valley Bank
                                     One Newton Executive Park, Suite 200
                                     2221 Washington Street
                                     Newton, Massachusetts  02462
                                     Attn: Ms. Bernadette Michaud
                                     Fax:  (617) 969-5973
                                     Email:  bmichaud@svbank.com

                  with a copy to:    Riemer & Braunstein LLP
                                     Three Center Plaza
                                     Boston, Massachusetts 02108
                                     Attn: David A. Ephraim, Esquire
                                     Fax: (617) 880-3456
                                     Email: DEphraim@riemerlaw.com


                                      -14-
<PAGE>



         11 CHOICE OF LAW, VENUE AND JURY TRIAL WAIVER AND JUDICIAL REFERENCE

         Massachusetts law governs the Loan Documents without regard to
principles of conflicts of law. Borrower and Bank each submit to the exclusive
jurisdiction of the State and Federal courts in Massachusetts; provided,
however, that if for any reason Bank cannot avail itself of such courts in the
Commonwealth of Massachusetts, Borrower accepts jurisdiction of the courts and
venue in Santa Clara County, California. NOTWITHSTANDING THE FOREGOING, BANK
SHALL HAVE THE RIGHT TO BRING ANY ACTION OR PROCEEDING AGAINST BORROWER OR ITS
PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION NECESSARY IN ORDER TO REALIZE
ON THE COLLATERAL OR TO OTHERWISE ENFORCE BANK'S RIGHTS AGAINST BORROWER OR ITS
PROPERTY.

TO THE EXTENT PERMITTED BY APPLICABLE LAW, BORROWER AND BANK EACH WAIVE THEIR
RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT OF OR BASED
UPON THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY CONTEMPLATED TRANSACTION,
INCLUDING CONTRACT, TORT, BREACH OF DUTY AND ALL OTHER CLAIMS. THIS WAIVER IS A
MATERIAL INDUCEMENT FOR BOTH PARTIES TO ENTER INTO THIS AGREEMENT. EACH PARTY
HAS REVIEWED THIS WAIVER WITH ITS COUNSEL.

         12 GENERAL PROVISIONS

         12.1 SUCCESSORS AND ASSIGNS. This Agreement binds and is for the
benefit of the successors and permitted assigns of each party. Borrower may not
assign this Agreement or any rights or obligations under it without Bank's prior
written consent (which may be granted or withheld in Bank's discretion). Bank
has the right, without the consent of or notice to Borrower, to sell, transfer,
negotiate, or grant participation in all or any part of, or any interest in,
Bank's obligations, rights, and benefits under this Agreement and the other Loan
Documents.

         12.2 INDEMNIFICATION. Borrower agrees to indemnify, defend and hold
Bank and its directors, officers, employees, agents, attorneys, or any other
Person affiliated with or representing Bank harmless against: (a) all
obligations, demands, claims, and liabilities (collectively, "Claims") asserted
by any other party in connection with the transactions contemplated by the Loan
Documents; and (b) all losses or Bank Expenses incurred, or paid by Bank from,
following, or arising from transactions between Bank and Borrower (including
reasonable attorneys' fees and expenses), except for Claims and/or losses
directly caused by Bank's gross negligence or willful misconduct.

         12.3 RESERVED.

         12.4 TIME OF ESSENCE. Time is of the essence for the performance of all
Obligations in this Agreement.

         12.5 SEVERABILITY OF PROVISIONS. Each provision of this Agreement is
severable from every other provision in determining the enforceability of any
provision.

         12.6 AMENDMENTS IN WRITING; INTEGRATION. All amendments to this
Agreement must be in writing signed by both Bank and Borrower. This Agreement
and the Loan Documents represent the entire agreement about this subject matter
and supersede prior negotiations or agreements. All prior agreements,
understandings, representations, warranties, and negotiations between the
parties about the subject matter of this Agreement and the Loan Documents merge
into this Agreement and the Loan Documents.

         12.7 COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by different parties on separate counterparts, each of which,
when executed and delivered, are an original, and all taken together, constitute
one Agreement.

         12.8 SURVIVAL. All covenants, representations and warranties made in
this Agreement continue in full force until this Agreement has terminated
pursuant to its terms and all Obligations (other than inchoate indemnity
obligations and any other obligations which, by their terms, are to survive the
termination of this Agreement) have been satisfied. The obligation of Borrower
in Section 12.2 to indemnify Bank shall survive until the statute of limitations
with respect to such claim or cause of action shall have run.


                                      -15-
<PAGE>

         12.9 CONFIDENTIALITY. In handling any confidential information, Bank
shall exercise the same degree of care that it exercises for its own proprietary
information, and agrees that it will keep confidential, but disclosure of
information may be made: (a) to Bank's Subsidiaries or Affiliates; (b) to
prospective transferees or purchasers of any interest in the Credit Extensions
(provided, however, Bank shall use commercially reasonable efforts to obtain
such prospective transferee's or purchaser's agreement to the terms of this
provision); (c) as required by law, regulation, subpoena, or other order; (d) to
Bank's regulators or as otherwise required in connection with Bank's examination
or audit; and (e) as Bank considers appropriate in exercising remedies under
this Agreement. Confidential information does not include information that
either: (i) is in the public domain or in Bank's possession when disclosed to
Bank, or becomes part of the public domain after disclosure to Bank; or (ii) is
disclosed to Bank by a third party, if Bank does not know that the third party
is prohibited from disclosing the information.

         12.10 RIGHT OF SET OFF. Borrower hereby grants to Bank, a lien,
security interest and right of set off as security for all Obligations to Bank,
whether now existing or hereafter arising upon and against all deposits,
credits, collateral and property, now or hereafter in the possession, custody,
safekeeping or control of Bank or any entity under the control of Bank
(including a Bank subsidiary) or in transit to any of them. At any time after
the occurrence and during the continuance of an Event of Default, without demand
or notice, Bank may set off the same or any part thereof and apply the same to
any liability or obligation of Borrower even though unmatured and regardless of
the adequacy of any other collateral securing the Obligations. ANY AND ALL
RIGHTS TO REQUIRE BANK TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY
OTHER COLLATERAL WHICH SECURES THE OBLIGATIONS, PRIOR TO EXERCISING ITS RIGHT OF
SETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF BORROWER ARE
HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.

         13 DEFINITIONS

         13.1 DEFINITIONS. As used in this Agreement, the following terms have
the following meanings:

         "ACCOUNT" is any "account" as defined in the Code with such additions
to such term as may hereafter be made, and includes, without limitation, all
accounts receivable and other sums owing to Borrower.

         "ACCOUNT DEBTOR" is any "account debtor" as defined in the Code with
such additions to such term as may hereafter be made.

         "AFFILIATE" of any Person is a Person that owns or controls directly or
indirectly the Person, any Person that controls or is controlled by or is under
common control with the Person, and each of that Person's senior executive
officers, directors, partners and, for any Person that is a limited liability
company, that Person's managers and members.

         "AGREEMENT" is defined in the preamble hereof.

         "BANK" is defined in the preamble hereof.

         "BANK EXPENSES" are all audit fees and expenses, costs, and expenses
(including reasonable attorneys' fees and expenses) for preparing, negotiating,
administering, defending and enforcing the Loan Documents (including, without
limitation, those incurred in connection with appeals or Insolvency Proceedings)
or otherwise incurred with respect to Borrower.

         "BOARD" means Borrower's board of directors.

         "BORROWER" is defined in the preamble hereof

         "BORROWER'S BOOKS" are all Borrower's books and records including
ledgers, federal and state tax returns, records regarding Borrower's assets or
liabilities, the Collateral, business operations or financial condition, and all
computer programs or storage or any equipment containing such information.

          "BORROWING RESOLUTIONS" are, with respect to any Person, those
resolutions adopted by such Person's Board of Directors and delivered by such
Person to Bank approving the Loan Documents to which such Person is a party and
the transactions contemplated thereby, together with a certificate executed by
its secretary on behalf of


                                      -16-
<PAGE>

such Person certifying that (a) such Person has the authority to execute,
deliver, and perform its obligations under each of the Loan Documents to which
it is a party, (b) that attached as Exhibit A to such certificate is a true,
correct, and complete copy of the resolutions then in full force and effect
authorizing and ratifying the execution, delivery, and performance by such
Person of the Loan Documents to which it is a party, (c) the name(s) of the
Person(s) authorized to execute the Loan Documents on behalf of such Person,
together with a sample of the true signature(s) of such Person(s), and (d) that
Bank may conclusively rely on such certificate unless and until such Person
shall have delivered to Bank a further certificate canceling or amending such
prior certificate.

          "BUSINESS DAY" is any day that is not a Saturday, Sunday or a day on
which Bank is closed.

         "CAPITALIZATION EVENT" is the receipt by Borrower of proceeds of
equity, in form and substance acceptable to Bank, resulting in unrestricted net
cash proceeds to Borrower of at least $40,000,000.00.

          "CASH EQUIVALENTS" means (a) marketable direct obligations issued or
unconditionally guaranteed by the United States or any agency or any State
thereof having maturities of not more than one (1) year from the date of
acquisition; (b) commercial paper maturing no more than one (1) year after its
creation and having the highest rating from either Standard & Poor's Ratings
Group or Moody's Investors Service, Inc., (c) Bank's certificates of deposit
issued maturing no more than one (1) year after issue; and (d) money market
funds at least ninety-five percent (95%) of the assets of which constitute Cash
Equivalents of the kinds described in clauses (a) through (c) of this
definition.

         "CODE" is the Uniform Commercial Code, as the same may, from time to
time, be enacted and in effect in the Commonwealth of Massachusetts; provided,
that, to the extent that the Code is used to define any term herein or in any
Loan Document and such term is defined differently in different Articles or
Divisions of the Code, the definition of such term contained in Article or
Division 9 shall govern; provided further, that in the event that, by reason of
mandatory provisions of law, any or all of the attachment, perfection, or
priority of, or remedies with respect to, Bank's Lien on any Collateral is
governed by the Uniform Commercial Code in effect in a jurisdiction other than
the Commonwealth of Massachusetts, the term "CODE" shall mean the Uniform
Commercial Code as enacted and in effect in such other jurisdiction solely for
purposes on the provisions thereof relating to such attachment, perfection,
priority, or remedies and for purposes of definitions relating to such
provisions.

         "COLLATERAL" is any and all properties, rights and assets of Borrower
described on Exhibit A.

         "COLLATERAL ACCOUNT" is any Deposit Account, Securities Account, or
Commodity Account.

          "COMMODITY ACCOUNT" is any "commodity account" as defined in the Code
with such additions to such term as may hereafter be made.

         "COMMUNICATION" is defined in Section 10.

         "COMPLIANCE CERTIFICATE" is that certain certificate in the form
attached hereto as Exhibit C.

         "CONTINGENT OBLIGATION" is, for any Person, any direct or indirect
liability, contingent or not, of that Person for (a) any indebtedness, lease,
dividend, letter of credit or other obligation of another such as an obligation
directly or indirectly guaranteed, endorsed, co-made, discounted or sold with
recourse by that Person, or for which that Person is directly or indirectly
liable; (b) any obligations for undrawn letters of credit for the account of
that Person; and (c) all obligations from any interest rate, currency or
commodity swap agreement, interest rate cap or collar agreement, or other
agreement or arrangement designated to protect a Person against fluctuation in
interest rates, currency exchange rates or commodity prices; but "Contingent
Obligation" does not include endorsements in the ordinary course of business.
The amount of a Contingent Obligation is the stated or determined amount of the
primary obligation for which the Contingent Obligation is made or, if not
determinable, the maximum reasonably anticipated liability for it determined by
the Person in good faith; but the amount may not exceed the maximum of the
obligations under any guarantee or other support arrangement.

         "CONTROL AGREEMENT" is any control agreement entered into among the
depository institution at which Borrower maintains a Deposit Account or the
securities intermediary or commodity intermediary at which Borrower maintains a
Securities Account or a Commodity account, Borrower, and Bank pursuant to which
Bank obtains control (within the meaning of the Code) over such Deposit Account,
Securities Account, or Commodity Account.


                                      -17-
<PAGE>

         "CREDIT EXTENSION" is any Term Advance, or any other extension of
credit by Bank for Borrower's benefit.

          "DEFAULT" means any event which with notice or passage of time or
both, would constitute an Event of Default.

         "DEFAULT RATE" is defined in Section 2.2(b).

          "DEPOSIT ACCOUNT" is any "deposit account" as defined in the Code with
such additions to such term as may hereafter be made.

         "DESIGNATED DEPOSIT ACCOUNT" is Borrower's deposit account, account
number _____________, maintained with Bank.

         "DOLLARS," "DOLLARS" and "$" each mean lawful money of the United
States.

          "DRAW PERIOD" is the period of time from the Effective Date through
the earliest to occur of (a) December 31, 2006 (or December 31, 2007 if the
Capitalization Event has occurred), (b) an Event of Default, or (c) the
existence of any Default.

          "EFFECTIVE DATE" is defined in the preamble of this Agreement.

         "ELIGIBLE ACCOUNTS" are Accounts which arise in the ordinary course of
Borrower's business. Bank reserves the right, at any time and from time to time
after the Effective Date but upon at least fifteen (15) days prior written
notice from Bank, to adjust any of the criteria set forth below and to establish
new criteria in its good faith business judgment. Unless Bank agrees otherwise
in writing, Eligible Accounts shall not include:

                  (a) Accounts for which the Account Debtor has not been
         invoiced;

                  (b) Accounts that the Account Debtor has not paid within one
hundred twenty (120) days of invoice date;

                  (c) Accounts owing from an Account Debtor which does not have
         its principal place of business in the United States; and

                  (d) Accounts owing from an Account Debtor which is a federal,
         state or local government entity or any department, agency, or
         instrumentality thereof.

         "ELIGIBLE PRODUCTS" shall mean System One and PureFlow SL products
manufactured by Borrower, including, without limitation, all related warmer,
cyclers, stands and other accessories and hardware, and deployed by Borrower in
support of Patients originated in the same quarter in which the Term Advance
was/is to be made.

          "EQUIPMENT" is all "equipment" as defined in the Code with such
additions to such term as may hereafter be made, and includes without limitation
all machinery, fixtures, goods, vehicles (including motor vehicles and
trailers), and any interest in any of the foregoing.

          "ERISA" is the Employment Retirement Income Security Act of 1974, and
its regulations.

         "EVENT OF DEFAULT" is defined in Section 8.

          "FUNDING DATE" is any date on which a Credit Extension is made to or
on account of Borrower which shall be a Business Day.

          "GAAP" is generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other Person as may be approved by a significant segment of the accounting
profession, which are applicable to the circumstances as of the date of
determination.


                                      -18-
<PAGE>

         "GENERAL INTANGIBLES" is all "general intangibles" as defined in the
Code in effect on the date hereof with such additions to such term as may
hereafter be made, and includes without limitation, all copyright rights,
copyright applications, copyright registrations and like protections in each
work of authorship and derivative work, whether published or unpublished, any
patents, trademarks, service marks and, to the extent permitted under applicable
law, any applications therefor, whether registered or not, any trade secret
rights, including any rights to unpatented inventions, payment intangibles,
royalties, contract rights, goodwill, franchise agreements, purchase orders,
customer lists, route lists, telephone numbers, domain names, claims, income and
other tax refunds, security and other deposits, options to purchase or sell real
or personal property, rights in all litigation presently or hereafter pending
(whether in contract, tort or otherwise), insurance policies (including without
limitation key man, property damage, and business interruption insurance),
payments of insurance and rights to payment of any kind.

          "INDEBTEDNESS" is (a) indebtedness for borrowed money or the deferred
price of property or services, such as reimbursement and other obligations for
surety bonds and letters of credit, (b) obligations evidenced by notes, bonds,
debentures or similar instruments, (c) capital lease obligations, and (d)
Contingent Obligations.

          "INSOLVENCY PROCEEDING" is any proceeding by or against any Person
under the United States Bankruptcy Code, or any other bankruptcy or insolvency
law, including assignments for the benefit of creditors, compositions,
extensions generally with its creditors, or proceedings seeking reorganization,
arrangement, or other relief.

          "INVENTORY" is all "inventory" as defined in the Code in effect on the
date hereof with such additions to such term as may hereafter be made, and
includes without limitation all merchandise, raw materials, parts, supplies,
packing and shipping materials, work in process and finished products, including
without limitation such inventory as is temporarily out of Borrower's custody or
possession or in transit and including any returned goods and any documents of
title representing any of the above.

         "INVESTMENT" is any beneficial ownership interest in any Person
(including stock, partnership interest or other securities), and any loan,
advance or capital contribution to any Person.

         "LIEN" is a mortgage, lien, deed of trust, charge, pledge, security
interest or other encumbrance.

         "LIGHTHOUSE AGREEMENTS" means that certain Loan and Security Agreement,
dated December 23, 2004, by and between Lighthouse Capital Partners V, L.P. and
Borrower, and all agreements entered into in connection therewith, as the same
may be amended, modified, supplemented or otherwise changed from time to time
prior to the Effective Date.

          "LOAN DOCUMENTS" are, collectively, this Agreement, the Perfection
Certificate, any note, or notes or guaranties executed by Borrower or any other
party in connection with this Agreement, all as amended, restated, or otherwise
modified.

         "MATERIAL ADVERSE CHANGE" is (a) a material impairment in the
perfection or priority of Bank's Lien in the Collateral or in the value of such
Collateral; (b) a material adverse change in the business, operations, or
condition (financial or otherwise) of Borrower; (c) a material impairment of the
prospect of repayment of any portion of the Obligations; or (d) Bank determines,
based upon information available to it and in its reasonable judgment, that
there is a substantial likelihood that Borrower shall fail to comply with one or
more of the financial covenants in Section 6 during the next succeeding
financial reporting period.

         "MATURITY DATE" is, for each Term Advance, the earliest of (a) the
first day of the month that is the thirty-fifth (35th) month in which Borrower
makes its first payment of principal pursuant to Section 2.1.1(b), or (b) the
occurrence of an Event of Default.

         "OBLIGATIONS" are Borrower's obligation to pay when due any debts,
principal, interest, Bank Expenses and other amounts Borrower owes Bank now or
later, under this Agreement or any of the Loan Documents, including, without
limitation, all obligations relating to letters of credit, cash management
services, and foreign exchange contracts, if any, and including interest
accruing after Insolvency Proceedings, and the performance of Borrower's duties
under the Loan Documents.


                                      -19-
<PAGE>

         "OPERATING DOCUMENTS" are, for any Person, such Person's formation
documents, as certified with the Secretary of State of such Person's state of
formation on a date that is no earlier than 30 days prior to the Effective Date,
and, its bylaws in current form, each of the foregoing with all current
amendments or modifications thereto.

         "PATIENTS" are patients of Borrower pursuant to a performing contract,
which contract is not in default.

         "PAYMENT/ADVANCE FORM" is that certain form attached hereto as Exhibit
B.

         "PERFECTION CERTIFICATE" is defined in Section 5.1.

         "PERMITTED INDEBTEDNESS" is:

         (a) Borrower's Indebtedness to Bank under this Agreement and the other
Loan Documents;

         (b) Indebtedness existing on the Effective Date and shown on the
Perfection Certificate;

         (c) Subordinated Debt;

         (d) unsecured Indebtedness to trade creditors incurred in the ordinary
course of business;

         (e) Indebtedness secured by Liens permitted under clause (c) of the
definition of "Permitted Liens" herein;

         (f) Indebtedness in connection with the Transfers permitted under
Section 7.1(e);

         (g) unsecured guarantees by Borrower of obligations of its direct or
indirect Subsidiaries entered into in the ordinary course, provided that
Borrower's maximum potential liability pursuant to such guarantees does not
exceed Fifty Thousand Dollars ($50,000.00) in the aggregate;

         (h) Indebtedness of Borrower's Subsidiaries to Borrower or to another
Subsidiary; and

         (i) extensions, refinancings, modifications, amendments and
restatements of any items of Permitted Indebtedness (a) through (h) above,
provided that the principal amount thereof is not increased or the terms thereof
are not modified to impose more burdensome terms upon Borrower or its
Subsidiary, as the case may be.

         "PERMITTED INVESTMENTS" are:

         (a) Investments shown on the Perfection Certificate and existing on the
Effective Date;

         (b) Cash Equivalents;

         (c) loans and advances to officers and employees of Borrower for
business purposes, or relocation expenses, and other Investments, provided that
the aggregate amount of Investments made pursuant to this subsection (c) shall
not exceed Two Hundred Fifty Thousand Dollars ($250,000.00) in the aggregate;

         (d) Investments in Borrower's Subsidiaries for the ordinary and
necessary operating expenses of such Subsidiaries in an amount not to exceed Two
Million Dollars ($2,000,000.00) in the aggregate per fiscal year; and

         (e) dividends paid by a Subsidiary (other than Borrower) to its parent.

         "PERMITTED LIENS" are:

         (a) Liens existing on the Effective Date and shown on the Perfection
Certificate or arising under this Agreement and the other Loan Documents;

         (b) Liens for taxes, fees, assessments or other government charges or
levies, either not delinquent or being contested in good faith and for which
Borrower maintains adequate reserves on its Books, if they have no priority over
any of Bank's Liens (except that such Liens (other than those liens relating to
federal or state income


                                      -20-
<PAGE>

taxes) may have priority over Bank's Liens, provided that the taxes, fees,
assessments or other governmental charges or levies in connection with such
Liens do not exceed Twenty-Five Thousand Dollars ($25,000.00) in the aggregate);

         (c) purchase money Liens and Liens with respect to capital leases (i)
on Equipment acquired or held by Borrower incurred for financing the acquisition
of the Equipment (or refunding the amount incurred for the acquisition thereof)
securing no more than One Million Dollars ($1,000,000.00) in the aggregate
principal amount outstanding, or (ii) existing on Equipment when acquired, if
the Lien is confined to the property and improvements and the proceeds of the
Equipment;

         (d) Liens in connection with Transfers permitted under Section 7.1(e)
of this Agreement;

         (e) Liens with respect to judgments which are not Events of Default
hereunder;

         (f) Liens to secure payment of worker's compensation, employment
insurance, old age pensions or other social security obligations of Borrower on
which Borrower is current and are in the ordinary course of its business,
provided that such Liens do not have priority over Bank's Lien;

         (g) Liens constituting deposits for real or personal property; and

         (h) Liens incurred in the extension, renewal or refinancing of the
indebtedness secured by Liens described in (a) through (g), but any extension,
renewal or replacement Lien must be limited to the property encumbered by the
existing Lien and the principal amount of the indebtedness may not increase.

         "PERSON" is any individual, sole proprietorship, partnership, limited
liability company, joint venture, company, trust, unincorporated organization,
association, corporation, institution, public benefit corporation, firm, joint
stock company, estate, entity or government agency.

         "PRIME RATE" is Bank's most recently announced "prime rate," even if it
is not Bank's lowest rate.

         "REGISTERED ORGANIZATION" is any "registered organization" as defined
in the Code with such additions to such term as may hereafter be made

         "RESPONSIBLE OFFICER" is any of the Chief Executive Officer, President,
Chief Financial Officer and Controller of Borrower.

         "SECURITIES ACCOUNT" is any "securities account" as defined in the Code
with such additions to such term as may hereafter be made.

         "SUBORDINATED DEBT" is indebtedness incurred by Borrower subordinated
to all of Borrower's now or hereafter indebtedness to Bank (pursuant to a
subordination, intercreditor, or other similar agreement in form and substance
satisfactory to Bank entered into between Bank and the other creditor), on terms
acceptable to Bank.

         "SUBSIDIARY" means, with respect to any Person, any Person of which
more than 50% of the voting stock or other equity interests is owned or
controlled, directly or indirectly, by such Person or one or more Affiliates of
such Person.

         "TERM ADVANCE" or "TERM ADVANCES" is defined in Section 2.1.1.

         "TERM LINE" is a Term Advance or Term Advances, outstanding at any
time, in the amount of up to (a) on and prior to December 31, 2006, $8,000,000
(provided that such amount shall increase to $10,000,000 after the occurrence of
the Capitalization Event), and (b) on and after January 1, 2007, only if the
Capitalization Event has occurred, $20,000,000 (inclusive of amounts in (a)
above).

         "TRANSFER" is defined in Section 7.1.

         "UNUSED TERM LINE FACILITY FEE" is defined in Section 2.3(b).


                                      -21-
<PAGE>

                             Signature page follows.


                                      -22-
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as a sealed instrument under the laws of the Commonwealth of
Massachusetts as of the Effective Date.

BORROWER:

NXSTAGE MEDICAL, INC.

By: /s/ Jeffrey H. Burbank
Name: Jeffrey H. Burbank
Title:  President and Chief Executive Officer

BANK:

SILICON VALLEY BANK

By: /s/ Thomas W. Davies
Name: Thomas W. Davies
Title:  Senior Relationship Manager


<PAGE>

                                    EXHIBIT A

The Collateral consists of all of Borrower's right, title and interest in and to
the following personal property:

         All goods, Accounts (including health-care receivables), Equipment,
Inventory, contract rights or rights to payment of money, leases, license
agreements, franchise agreements, General Intangibles (except as provided
below), commercial tort claims, documents, instruments (including any promissory
notes), chattel paper (whether tangible or electronic), cash, deposit accounts,
fixtures, letters of credit rights (whether or not the letter of credit is
evidenced by a writing), securities, and all other investment property,
supporting obligations, and financial assets, whether now owned or hereafter
acquired, wherever located; and

         all Borrower's Books relating to the foregoing, and any and all claims,
rights and interests in any of the above and all substitutions for, additions,
attachments, accessories, accessions and improvements to and replacements,
products, proceeds and insurance proceeds of any or all of the foregoing.

         Notwithstanding the foregoing, the Collateral does not include any of
the following, whether now owned or hereafter acquired, (i) any stock of direct
subsidiaries of Borrower which are not organized under the laws of the United
States of America or any state or political subdivision thereof, or (ii) any
copyright rights, copyright applications, copyright registrations and like
protections in each work of authorship and derivative work, whether published or
unpublished, any patents, patent applications and like protections, including
improvements, divisions, continuations, renewals, reissues, extensions, and
continuations-in-part of the same, trademarks, service marks and, to the extent
permitted under applicable law, any applications therefor, whether registered or
not, and the goodwill of the business of Borrower connected with and symbolized
thereby, know-how, operating manuals, trade secret rights, rights to unpatented
inventions, and any claims for damage by way of any past, present, or future
infringement of any of the foregoing; provided, however, the Collateral shall
include all Accounts, license and royalty fees and other revenues, proceeds, or
income arising out of or relating to any of the foregoing.

         Pursuant to the terms of a certain negative pledge arrangement with
Bank, Borrower has agreed not to encumber (except as otherwise permitted in the
Agreement) any of its copyright rights, copyright applications, copyright
registrations and like protections in each work of authorship and derivative
work, whether published or unpublished, any patents, patent applications and
like protections, including improvements, divisions, continuations, renewals,
reissues, extensions, and continuations-in-part of the same, trademarks, service
marks and, to the extent permitted under applicable law, any applications
therefor, whether registered or not, and the goodwill of the business of
Borrower connected with and symbolized thereby, know-how, operating manuals,
trade secret rights, rights to unpatented inventions, and any claims for damage
by way of any past, present, or future infringement of any of the foregoing,
without Bank's prior written consent.

                                       1