Loan and Security Agreement



 Exhibit 10.1 
 LOAN AND SECURITY AGREEMENT 
 THIS LOAN AND SECURITY AGREEMENT (this
“Agreement”) dated as of the Effective Date between SILICON VALLEY BANK, a California corporation (“Bank”), and SOLTA 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 Revolving Advances. 
 (a) Availability. Subject to the terms and conditions of this Agreement, Bank shall make Advances not exceeding the Availability
Amount. Amounts borrowed hereunder may be repaid and, prior to the Revolving Line Maturity Date, reborrowed, subject to the applicable terms and conditions precedent herein. 
 (b) Termination; Repayment. The Revolving Line terminates on the Revolving Line Maturity Date, when the principal amount of all
Advances, the unpaid interest thereon, and all other Obligations relating to the Revolving Line shall be immediately due and payable. 
 (c) Early Termination. At Borrower’s option, Borrower shall have the option to terminate the Revolving Line prior to the Revolving Maturity Date, provided Borrower (a) provides written notice
to Bank of its election to exercise to terminate the Revolving Line at least fifteen (15) days prior to such termination, and (b) pays, on the date of such termination (i) all accrued and unpaid interest with respect to the
outstanding Advances through the date of such Termination; (ii) all outstanding principal with respect to the Advances; (iii) an early termination fee equal to Sixty Thousand Dollars ($60,000) (the “Revolving Line Termination
Fee”); and (iv) all other sums, if any, that shall have become due and payable hereunder with respect to this Agreement. 
 2.1.2 Term Loan. 
 (a) Availability. Bank shall make one (1) term loan available to Borrower in
an amount up to the Term Loan Amount on the Effective Date subject to the satisfaction of the terms and conditions of this Agreement. 
 (b) Repayment. Interest shall accrue on the Term Loan from the date the Term Loan is made. Borrower shall repay the Term Loan in thirty three (33) equal monthly installments of principal and interest (the
“Term Loan Payment”) on the first day of each month beginning on March 1, 2009. Borrower’s final Term Loan Payment, due on the Term Loan Maturity Date, shall include all outstanding principal and accrued and unpaid
interest under the Term Loan. 
 (c) Prepayment. At Borrower’s option, Borrower shall have the option to prepay
all, but not less than all, of the Term Loan, provided Borrower (a) provides written notice to Bank of its election to exercise to prepay the Term Loan at least fifteen (15) days prior to such prepayment, and (b) pays, on the
date of the prepayment (i) all accrued and unpaid interest with respect to the Term Loan through the date the prepayment is 








 
made; (ii) all unpaid principal with respect to the Term Loan; (iii) the Final Payment Fee in accordance with the terms of Section 2.4(a),
(iv) a prepayment fee equal to two percent (2.00%) of the aggregate principal amount of the Term Loan made to Borrower (the “Term Loan Prepayment Fee”) and (v) all other sums, if any, that shall have become due and payable
hereunder with respect to this Agreement. 
 2.2 Overadvances. If, at any time, the outstanding principal amount of any
Advances exceeds the lesser of either the Revolving Line or the Borrowing Base, Borrower shall immediately pay to Bank in cash such excess. 
 2.3 Payment of Interest on the Credit Extensions. 
 (a) Interest Rate. 
 (i) Advances. Subject to Section 2.3(b), the principal amount outstanding under the Revolving Line shall accrue interest at a
floating per annum rate equal to the greater of (A) one percentage point (1.00%) above the Prime Rate or (B) five percent (5.00%). 
 (ii) Term Loan. Subject to Section 2.3(b), the principal amount outstanding under the Term Loan shall accrue interest at a fixed per annum rate equal to the greater of (A) the Basic Rate or
(B) six and one quarter percent (6.25%), which interest shall be payable monthly. 
 (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 that is otherwise applicable thereto (the “Default Rate”).
Payment or acceptance of the increased interest rate provided in this Section 2.3(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, including the Designated Deposit Account, for principal and interest payments or any other amounts Borrower owes Bank when due.
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 p.m. Pacific 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. 
 2.4
Fees. Borrower shall pay to Bank: 
 (a) Final Payment Fee. On the earlier of (i) the Term Loan
Maturity Date or (ii) the date the Term Loan is prepaid in full, a Final Payment Fee equal to three and one half percent (3.50%) of the aggregate principal amount of the Term Loan made by Bank to Borrower hereunder; 
 (b) Revolving Line Termination Fee. The Revolving Line Termination Fee if and when due pursuant to the terms of
Section 2.1.1(c); 
 (c) Term Loan Prepayment Fee. The Term Loan Prepayment Fee if and when due pursuant to the
terms of Section 2.1.2(c); and 
  

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 (d) 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. Borrower has given Bank a good faith deposit of Fifty Thousand Dollars ($50,000) which shall be applied to
Bank Expenses. 
 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 Borrower shall consent to or have delivered,
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: 
 (a) duly executed original signatures to the Loan Documents to which Borrower, Guarantor or Bank is a party; 
 (b) duly executed original signatures to the Control Agreements, if any; 
 (c) their Operating Documents and a good standing certificate of Borrower and Guarantor 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 and Guarantor; 
 (e) 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; 
 (f) the Perfection Certificate(s) executed by
Borrower and Guarantor; 
 (g) evidence satisfactory to Bank that the insurance policies required by Section 6.5 hereof
are in full force and effect, together with appropriate evidence showing lender loss payable and/or additional insured clauses or endorsements in favor of Bank; 
 (h) the completion of the Initial Audit with results satisfactory to Bank in its sole and absolute discretion (provided however that this
shall only be a condition precedent to the initial Advance and not the Term Loan); and 
 (i) payment of the fees and Bank
Expenses then due as specified in Section 2.4 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(a), 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 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 

  

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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) in Bank’s sole discretion, there has not been a Material Adverse Change. 
 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 a Credit Extension made 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 Credit Extension in the
absence of a required item shall be made in Bank’s sole discretion. 
 3.4 Procedures for Borrowing. 
 (a) Advances. Subject to the prior satisfaction of all other applicable conditions to the making of an Advance set forth in this
Agreement, to obtain an Advance, Borrower shall notify Bank (which notice shall be irrevocable) by electronic mail, facsimile, or telephone by 12:00 p.m. Pacific time on the Funding Date of the Advance. Together with any such electronic or facsimile
notification, Borrower shall deliver to Bank by electronic mail or facsimile a completed Payment/Advance Form executed by a Responsible Officer or his or her designee. Bank may rely on any telephone notice given by a person whom Bank believes is a
Responsible Officer or designee. Bank shall credit Advances to the Designated Deposit Account. Bank may make Advances under this Agreement based on instructions from a Responsible Officer or his or her designee or without instructions if the
Advances are necessary to meet Obligations which have become due. 
 (b) Term Loan. Subject to the prior satisfaction
of all other applicable conditions to the making of the Term Loan, to obtain the Term Loan, Borrower shall notify Bank (which notice shall be irrevocable) by electronic mail, facsimile, or telephone by 12:00 p.m. Pacific time on the Funding Date of
the Term Loan. Together with any such electronic or facsimile notification, Borrower shall deliver to Bank by electronic mail or facsimile a completed Payment/Advance Form executed by a Responsible Officer or his or her designee. Bank may rely on
any telephone notice given by a person whom Bank believes is a Responsible Officer or designee. Bank shall credit the Term Loan to the Designated Deposit Account. 
 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, 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. 
 Notwithstanding the foregoing or anything else contained herein to the contrary, “Collateral” shall not include (i) property that is
nonassignable by its terms without the consent of the licensor thereof or another party, or equipment subject to a lien described in subsection (c) of the defined term “Permitted Liens” and subject to a negative pledge (but in each
case, only to the extent such prohibition on transfer or negative pledge is enforceable under applicable law, including, without limitation, Sections 9406 and 9408 of the Code), or (ii) property, the granting of a security interest therein is
contrary to applicable law, provided that upon the cessation of any such restriction or prohibition, such property shall automatically become part of the Collateral; (iii) more than sixty five percent (65%) of the presently existing and
hereafter arising issued and outstanding shares of capital stock owned by Borrower of any Foreign Subsidiary which shares entitle the holder thereof to vote for directors or any other matter or (iv) any application for a trademark (including,
without limitation, intent-to-use trademark or service applications and any goodwill associated therewith) that would otherwise be deemed invalidated, cancelled or abandoned due to the grant of a Lien thereon unless and until such time as the grant
of such Lien will not affect the validity of such trademark. 
  

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 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 (other than inchoate indemnity 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. Such financing statements may indicate the Collateral as “all assets of
the Debtor” or words of similar effect, or as being of an equal or lesser scope, or with greater detail, all in Bank’s discretion. 
 5 REPRESENTATIONS AND WARRANTIES 
 Borrower represents and warrants as follows: 
 5.1 Due Organization, Authorization; Power and Authority. Borrower is duly existing and in good standing in its jurisdiction of formation
and is qualified and licensed to do business and is in good standing in any jurisdiction in which the conduct of its business or its ownership of property requires that it 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 completed certificates signed by Borrower and Guarantor, respectively, entitled “Perfection
Certificate”. Borrower represents and warrants to Bank that (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) Borrower (and each
of its predecessors) has not, in the past five (5) years, changed its jurisdiction of formation, organizational structure or type, or any organizational number assigned by its jurisdiction; and (f) as of the Effective Date, all other
information set forth on the Perfection Certificate pertaining to Borrower and each of its Subsidiaries is accurate and complete. 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 by Borrower
of the Loan Documents to which it is a party have been duly authorized, and do not (i) conflict with any of Borrower’s organizational documents, (ii) contravene, conflict with, constitute a default under or violate any material
Requirement of Law, (iii) contravene, conflict or violate any applicable order, writ, judgment, injunction, decree, determination or award of any Governmental Authority by which Borrower or any its Subsidiaries or any of their property or
assets may be bound or affected, (iv) require any action by, filing, registration, or qualification with, or Governmental Approval from, any Governmental Authority (except such Governmental Approvals which have already been obtained and are in
full force and effect or (v) 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 Accounts are bona fide, existing obligations of the Account Debtors. 
  

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 The Collateral is not in the possession of any third party bailee (such as a warehouse) except as
otherwise provided in the Perfection Certificate. None of the components of the Collateral shall be maintained at locations other than as provided in the Perfection Certificate or as permitted 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, 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; provided, however, that notwithstanding the foregoing, Borrower shall not be required to obtain the consent of Bank and shall not be required to obtain a bailee agreement with respect to
(i) any demonstration equipment that is delivered to any of Borrower’s customers in the ordinary course of business provided that the value of such equipment does not exceed Three Million Five Hundred Dollars ($3,500,000) in the aggregate
and (ii) any raw materials and inventory located at various vendor and contract manufacturer sites pursuant to supply and/or manufacturing agreements. 
 Except as otherwise disclosed to Bank in writing, Borrower is the sole owner of its intellectual property, except for (i) intellectual property licensed from third parties, (ii) non-exclusive licenses
granted to its distributors and customers in the ordinary course of business and licenses that may be exclusive in some respects other than territory (and/or that may be exclusive as to territory only in discreet geographical areas outside of the
United States), but that could not result in a legal transfer of Borrower’s title in the licensed property. To the best of Borrower’s knowledge, each patent is valid and enforceable, and except for patents in re-examination proceedings in
the U.S. Patent and Trademark Office, no part of the 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 material agreement with respect to which Borrower is the licensee of intellectual property that prohibits or otherwise restricts Borrower from granting a security interest in Borrower’s interest in such
license or agreement. Borrower shall provide written notice to Bank within ten (10) days of entering or becoming bound by any such license or agreement (other than over-the-counter software that is commercially available to the public).
Borrower shall take such steps as Bank reasonably requests to obtain the consent of, or waiver by, any person whose consent or waiver is necessary for (x) all such licenses or agreements 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, whether now existing or entered into in the future, and (y) Bank to have the ability in the event of a
liquidation of any Collateral to dispose of such Collateral in accordance with Bank’s rights and remedies under this Agreement and the other Loan Documents. 
 5.3 Accounts Receivable; Inventory. For any Eligible Account used in calculation of the Borrowing Base, all statements made and all unpaid balances appearing in all invoices, instruments and other documents
evidencing such Eligible Accounts are and shall be true and correct and all such invoices, instruments and other documents, and all of Borrower’s Books are genuine and in all respects what they purport to be. Whether or not an Event of Default
has occurred and is continuing, Bank may notify any Account Debtor owing Borrower money of Bank’s security interest in such funds and verify the amount of such Eligible Account. All sales and other transactions underlying or giving rise to each
Eligible Account shall comply in all material respects with all applicable laws and governmental rules and regulations. Borrower has no knowledge of any actual or imminent Insolvency Proceeding of any Account Debtor whose accounts are Eligible
Accounts used in calculation of the Borrowing Base. To the best of Borrower’s knowledge, all signatures and endorsements on all documents, instruments, and agreements relating to all Eligible Accounts are genuine, and all such documents,
instruments and agreements are legally enforceable in accordance with their terms. 
 5.4 Litigation. Except as set
forth in the Perfection Certificate or as disclosed to Bank in writing, 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 that could
reasonably be expected to result in damages or costs to Borrower or any Subsidiary involving more than Five Hundred Thousand Dollars ($500,000). 
 5.5 No Material Deviation 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. 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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 5.6 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. 
 5.7 Regulatory Compliance. Borrower is not an “investment company” or a company “controlled” by an “investment
company” under the Investment Company Act of 1940, as amended. Borrower is not engaged as one of its important activities in extending credit for margin stock (under Regulations X, T and U of the Federal Reserve Board of Governors). Borrower
has complied in all material respects with the Federal Fair Labor Standards Act. Neither Borrower nor any of its Subsidiaries is a “holding company” or an “affiliate” of a “holding company” or a “subsidiary
company” of a “holding company” as each term is defined and used in the Public Utility Holding Company Act of 2005. 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 or, to the best of Borrower’s knowledge, by previous Persons, 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 their respective businesses as currently conducted. 
 5.8 Subsidiaries;
Investments. Borrower does not own any stock, partnership interest or other equity securities except for Permitted Investments. 
 5.9
Tax Returns and Payments; Pension Contributions. Borrower has timely filed all required material tax returns and reports, and Borrower has timely paid all material foreign, federal, state and local taxes, assessments, deposits and
contributions owed by Borrower. 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, (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 result in additional taxes 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. 
 5.10 Use of Proceeds. Borrower shall use the proceeds of the Credit Extensions
solely as working capital, to fund its general business requirements and not for personal, family, household or agricultural purposes. 
 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 representation, warranty, or other statement was 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. 
 (a) Except as permitted by Section 7.3, maintain its and all its
Subsidiaries’ legal existence and good standing in their respective jurisdictions of formation and maintain qualification in each jurisdiction in 

  

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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 which it is subject, noncompliance with which could have a material adverse effect on Borrower’s business. 
 (b) Obtain all of the Governmental Approvals necessary for the performance by Borrower of its obligations under the Loan Documents to
which it is a party and the grant of a security interest to Bank in all of its property. Borrower shall promptly provide copies of any such obtained Governmental Approvals to Bank. 
 6.2 Financial Statements, Reports, Certificates. 
 (a) Deliver to Bank: (i) as soon as available, but no later than five (5) days after filing with the Securities Exchange Commission, Borrower’s 10K, 10Q, and 8K reports; (ii) a Compliance
Certificate together with delivery of the 10K and 10Q reports; (iii) within seven (7) days after approval by Borrower’s board of directors, annual financial projections for the following fiscal year (on a quarterly basis) as approved
by Borrower’s board of directors, together with any related business forecasts used in the preparation of such annual financial projections; (iv) a prompt report of any legal actions pending or threatened in writing against Borrower or any
Subsidiary that could reasonably be expected to result in damages or costs to Borrower or any Subsidiary of Five Hundred Thousand Dollars ($500,000) or more; and (v) budgets, sales projections, operating plans or other financial information
Bank reasonably requests. 
 Borrower’s 10K, 10Q, and 8K reports required to be delivered pursuant to Section 6.2(a)(i) and any
litigation disclosure required to be delivered pursuant to Section 6.2(a)(iv) that is disclosed in such exchange act reports shall be deemed to have been delivered on the date on which Borrower posts such report or provides a link thereto on
Borrower’s or another website on the Internet; provided, that Borrower shall provide paper copies to Bank of the Compliance Certificates required by Section 6.2(a)(ii). 
 (b) Within thirty (30) days after the last day of each month, deliver to Bank (i) aged listings of accounts receivable and
accounts payable (by invoice date) and (ii) a report of Deferred Revenue. 
 (c) Within thirty (30) days after the
last day of each month, deliver to Bank its monthly financial statements together with 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. The Initial Audit shall be
completed no later than the earlier of (i) sixty (60) days after the Effective Date or (ii) prior to the first request for an Advance. After the Initial Audit, such audits shall be conducted at least once every six
(6) months, or more often as conditions warrant. 
 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 One Hundred Thousand Dollars ($100,000). 
 6.4 Taxes; Pensions. Timely file, and require
each of its Subsidiaries to timely file, all required material tax returns and reports and timely pay, and require each of its Subsidiaries to timely pay, all material foreign, federal, state and local taxes, assessments, deposits and contributions
owed by Borrower and each of its Subsidiaries, except for deferred payment of any taxes contested pursuant to the terms of Section 5.9 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. Insurance policies shall be in a form, with companies, and in
amounts that are satisfactory to Bank. All property policies shall have a lender’s loss payable endorsement showing Bank as lender loss payee and waive subrogation against Bank, and all liability 

  

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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 shall endeavor to 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. If no Event of Default exists, proceeds payable under any policy shall be payable to Borrower to repair, replace or otherwise obtain property useful in Borrower’s business. If an Event of Default exists, proceeds
payable under any policy shall, at Bank’s option, 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) Excluding the Excluded Accounts, maintain its primary and Guarantor’s primary operating and other deposit accounts and securities accounts with Bank and Bank’s Affiliates.  
 (b) Provide Bank five (5) days prior written notice before establishing any Collateral Account (other than the Excluded Accounts) at
or with any bank or financial institution other than Bank or Bank’s Affiliates. For each Collateral Account (other than the Excluded Accounts) that Borrower or Guarantor 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 any of the following (collectively, the “Excluded Accounts”): (i) deposit accounts exclusively used for payroll,
payroll taxes and other employee wage and benefit payments to or for the benefit of Borrower’s or Guarantor’s employees and identified to Bank by Borrower or Guarantor as such, (ii) Borrower’s deposit account number 1892037191
maintained at Comerica Bank as of the Effective Date, provided the balance in such account shall not exceed Two Hundred Fifty Thousand Dollars ($250,000) for more than two (2) Business Days at any time and Borrower agrees to close such deposit
account within ninety (90) days following the Effective Date and (ii) Borrower’s securities account number 22026457 maintained at Bear Stearns, a division of J.P. Morgan (the “Bear Stearns Margin Account”) that secures
Borrower’s margin loans that have been extended to Borrower by Bear Stearns pursuant to the documentation attached hereto as Exhibit E (the “Margin Loan”). 
 (c) Bank may, in its good faith business judgment, require that all proceeds of Accounts be deposited by Borrower into a lockbox account,
or such other “blocked account” as Bank may specify, pursuant to a blocked account agreement in such form as Bank may specify in its good faith business judgment. 
 6.7 Financial Covenants. 
 Borrower shall maintain at all times, to be tested as of the last day of each month, unless otherwise noted, on a consolidated basis with respect to Borrower and its Subsidiaries: 
 (a) Liquidity Ratio. A ratio of Liquidity to all Indebtedness owing from Borrower to Bank of at least 1.65 to 1.00. 
 (b) EBITDA. On a quarterly basis, beginning with the quarter ending December 31, 2009, EBITDA of at least One Dollar ($1.00).

 (c) Tangible Net Worth. A Tangible Net Worth of not less than Fourteen Million Dollars ($14,000,000). 
 6.8 Protection and Registration of Intellectual Property Rights. Borrower shall: (a) protect, defend and maintain the validity and
enforceability of its intellectual property in good faith and in the ordinary course of business; (b) promptly advise Bank in writing of material infringements of its intellectual property; and (c) not allow any intellectual property
material to Borrower’s business to be abandoned, forfeited or dedicated to the 

  

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public without Bank’s written consent. If Borrower (i) obtains any patent, registered trademark or servicemark, registered copyright, registered
mask work, or any pending application for any of the foregoing, whether as owner, licensee or otherwise, or (ii) applies for any patent or the registration of any trademark or servicemark, then Borrower shall provide written notice thereof to
Bank on a quarterly basis to be delivered with the delivery of the Compliance Certificate and shall execute such intellectual property security agreements and other documents and take such other actions as Bank shall request in its good faith
business judgment to perfect and maintain a first priority perfected security interest in favor of Bank in such property. If Borrower decides to register any copyrights or mask works in the United States Copyright Office, Borrower shall:
(x) provide Bank with at least fifteen (15) days prior written notice of Borrower’s intent to register such copyrights or mask works together with a copy of the application it intends to file with the United States Copyright Office
(excluding exhibits thereto); (y) execute an intellectual property security agreement and such other documents and take such other actions as Bank may request in its good faith business judgment to perfect and maintain a first priority
perfected security interest in favor of Bank in the copyrights or mask works intended to be registered with the United States Copyright Office; and (z) record such intellectual property security agreement with the United States Copyright Office
contemporaneously with filing the copyright or mask work application(s) with the United States Copyright Office. On a quarterly basis, to be delivered with the delivery of the Compliance Certificate, Borrower shall provide to Bank copies of all
applications that it files for patents or for the registration of trademarks, servicemarks, copyrights or mask works, together with evidence of the recording of the intellectual property security agreement necessary for Bank to perfect and maintain
a first priority perfected security interest in such property. 
 6.9 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. 
 6.10 Further Assurances. 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: 
 (a) Transfers in the ordinary course of business for reasonably equivalent consideration; 
 (b) Transfers to Borrower or any of its Subsidiaries from Borrower or any of its Subsidiaries; 
 (c) Transfers of property in connection with sale-leaseback transactions; 
 (d) Transfers of property to the extent such property is exchanged for credit against, or proceeds are promptly applied to, the purchase
price of other property used or useful in the business of Borrower or its Subsidiaries; 
 (e) Transfers constituting
(i) non-exclusive licenses and similar arrangements for the use of the property of Borrower or its Subsidiaries in the ordinary course of business, (ii) other non-perpetual licenses that may be exclusive in some respects other than
territory (and/or that may be exclusive as to territory only in discreet geographical areas outside of the United States), but that could not result in a legal transfer of Borrower’s title in the licensed property and (iii) perpetual
exclusive licenses with respect to fields of use outside of the “aesthetic field of use”; 
 (f) Transfers otherwise
permitted by the Loan Documents; 
  

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 (g) sales or discounting of delinquent accounts in the ordinary course of business;

 (h) Transfers associated with the making or disposition of a Permitted Investment; 
 (i) Sales of inventory in the ordinary course of business; 
 (j) Transfers in connection with a permitted acquisition of a portion of the assets or rights acquired; and 
 (k) Transfers of assets (other than Accounts or Inventory (unless such Transfer is in the ordinary course of Borrower’s business) not
otherwise permitted in this Section 7.1, provided, that the aggregate book value of all such Transfers by Borrower and its Subsidiaries, together, shall not exceed in any fiscal year, five percent (5.00%) of Borrower’s consolidated
total assets as of the last day of the fiscal year immediately preceding the date of determination. 
 7.2 Changes in Business; Change in
Control; Jurisdiction of Formation. 
 Engage in any material line of business other than those lines of business conducted by Borrower
and its Subsidiaries on the date hereof and any businesses reasonably related, complementary or incidental thereto or reasonable extensions thereof. Borrower will not, without prior written notice, change its jurisdiction of formation. 

7.3 Mergers or Acquisitions. 
 Merge or consolidate, or permit any of its Subsidiaries to merge or consolidate, with any Person other than with Borrower or any Subsidiary, or acquire, or permit any of its Subsidiaries to acquire, all or substantially all of the capital
stock or property of a Person other than Borrower or any Subsidiary, except where no Event of Default has occurred and is continuing or would result from such action during the term of this Agreement, and (a) Borrower is the surviving entity or
(b) such merger or consolidation is a Transfer otherwise permitted pursuant to Section 7.1 hereof. 
 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, allow, or suffer any Lien on any of its property, or assign or convey any right to receive income, including the sale of any Accounts, or permit any of its Subsidiaries to do so, except, in each case, for Permitted
Liens, and permit any Collateral not to be subject to the first priority security interest granted herein, except for Permitted Liens, 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 Borrower’s or any Subsidiary’s
intellectual property, except with respect to transactions otherwise permitted in Section 7.1 hereof and with respect to transactions that are subject to a Permitted Lien. 
 7.6 Maintenance of Collateral Accounts. Maintain any Collateral Account except pursuant to the terms of Section 6.6 hereof.

 7.7 Distributions; Investments. (a) Pay any dividends or make any distribution or payment or redeem, retire or purchase
any capital stock other than Permitted Distributions; or (b) directly or indirectly acquire or own any Person, or make any Investment in any Person, other than Permitted Investments, or permit any of its Subsidiaries to do so. 
 7.8 Transactions with Affiliates. Directly or indirectly enter into or permit to exist any material transaction with any Affiliate of Borrower
except for (a) transactions that are in the ordinary course of Borrower’s business, upon fair and reasonable terms (when viewed in the context of any series of transactions of which it may be a part, if applicable) that are no less
favorable to Borrower than would be obtained in an arm’s length transaction with a non-affiliated Person; or (b) transactions among Borrower and its Subsidiaries and among Borrower’s Subsidiaries so long as no Event of Default exists
or could result therefrom. 
  

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 7.9 Subordinated Debt. Make or permit any payment on or amendments of any Subordinated Debt,
except (a) payments pursuant to the terms of the Subordinated Debt; (b) payments made with Borrower’s capital stock or other Subordinated Debt; or (c) amendments to Subordinated Debt so long as such Subordinated Debt remains
subordinated in right of payment to this Agreement and any Liens securing such Subordinated Debt remain subordinate in priority to Bank’s Lien hereunder. 
 7.10 Compliance. Become an “investment company” or a company controlled by an “investment company”, under the Investment Company Act of 1940, as amended, 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 (3) day grace period shall not apply to payments due on the Revolving Line Maturity Date or the Term Loan 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, 6.4, 6.5,
6.6 or 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 contained in this Agreement or any Loan Documents, and as to any default (other than those specified in this Section 8) 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 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; Levy; Restraint on Business. (a) (i) The service of process
seeking to attach, by trustee or similar process, any funds of Borrower or of any entity under control of Borrower (including a Subsidiary) on deposit with Bank or any Bank Affiliate, or (ii) a notice of lien, levy, or assessment is filed
against any of Borrower’s assets by any government agency, and the same under subclauses (i) and (ii) hereof are not, within ten 

  

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(10) days after the occurrence thereof, discharged or stayed (whether through the posting of a bond or otherwise); provided, however, no Credit Extensions
shall be made during any ten (10) day cure period; and (b) (i) any material portion of Borrower’s assets is attached, seized, levied on, or comes into possession of a trustee or receiver, or (ii) any court order enjoins,
restrains, or prevents Borrower from conducting any part of its business; 
 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 thirty
(30) 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. If Borrower fails to (a) make any payment that is due and payable with respect to any Material Indebtedness and
such failure continues after the applicable grace or notice period, if any, specified in the agreement or instrument relating thereto, or (b) perform or observe any other condition or covenant, or any other event shall occur or condition exist
under any agreement or instrument relating to any Material Indebtedness, and such failure continues after the applicable grace or notice period, if any, specified in the agreement or instrument relating thereto and the effect of such failure, event
or condition is to cause the holder or holders of such Material Indebtedness to accelerate the maturity of such Material Indebtedness or cause the mandatory repurchase of any Material Indebtedness; 
 8.7 Judgments. One or more judgments, orders, or decrees for the payment of money in an amount, individually or in the aggregate, of at
least Two Hundred Fifty Thousand Dollars ($250,000) (not covered by independent third-party insurance as to which liability has been accepted by such insurance carrier) shall be rendered against Borrower and shall remain unsatisfied, unvacated, or
unstayed for a period of ten (10) days after the entry thereof (provided that no Credit Extensions will be made prior to the satisfaction, vacation, or stay of such judgment, order, or decree); 
 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 between Borrower and any creditor of Borrower that signed a
subordination, intercreditor, or other similar agreement with Bank, or any creditor that has signed such an agreement with Bank breaches any terms of such agreement and such default or breach continues after applicable grace or notice period, if
any, specified in the agreement or instrument relating thereto; 
 8.10 Change of Control. If a Change of Control occurs. 

8.11 Guaranty. (a) Any guaranty of any Obligations terminates or ceases for any reason to be in full force and effect; (b) any
Guarantor does not perform any obligation or covenant under any guaranty of the Obligations; (c) any circumstance described in Sections 8.3, 8.4, 8.5, 8.7, or 8.8. occurs with respect to any Guarantor, or (d) the liquidation, winding up,
or termination of existence of any Guarantor. 
 8.12 Governmental Approvals. Any Governmental Approval shall have been
(a) revoked, rescinded, suspended, modified in an adverse manner or not renewed in the ordinary course for a full term or (b) subject to any decision by a Governmental Authority that designates a hearing with respect to any applications
for renewal of any of such Governmental Approval or that could result in the Governmental Authority taking any of the actions described in clause (a) above, and such decision or such revocation, rescission, suspension, modification or
non-renewal (i) has, or could reasonably be expected to have, a Material Adverse Change, or (ii) adversely affects the legal qualifications of Borrower or any of its Subsidiaries to hold such Governmental Approval in any applicable
jurisdiction and such revocation, rescission, suspension, modification or non-renewal could reasonably be expected to affect the status of or legal qualifications of Borrower or any of its Subsidiaries to hold any Governmental Approval in any other
jurisdiction. 
  

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 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); 
 (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. 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 (other than inchoate indemnity 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. 
  

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 9.3 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. 
 9.4 Application of Payments and Proceeds. Borrower shall have no right to specify the order or the accounts to which Bank shall allocate or
apply any payments required to be made by Borrower to Bank or otherwise received by Bank under this Agreement when any such allocation or application is not specified elsewhere in this Agreement. 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. If Bank, in its good faith business judgment, directly or
indirectly enters into a deferred payment or other credit transaction with any purchaser at any sale of Collateral, Bank shall have the option, exercisable at any time, of either reducing the Obligations by the principal amount of the purchase price
or deferring the reduction of the Obligations until the actual receipt by Bank of cash therefor. 
 9.5 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. 
 9.6 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. 
 9.7 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 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; (b) upon transmission, when sent by electronic mail or facsimile
transmission; (c) one (1) Business Day after deposit with a reputable overnight courier with all charges prepaid; 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 mailing or electronic mail address or facsimile number by giving the other party written notice thereof in accordance with the terms of this
Section 10. 
  

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	 If to Borrower:
	  	SOLTA MEDICAL, INC.
		  	25881 Industrial Boulevard
		  	Hayward, CA 94545
		  	Attn: Jack Glenn, Chief Financial Officer
		  	 Fax: 510-786-6990
 Email:
jglenn@solta.com


  

			
	         If to Bank:
	  	Silicon Valley Bank
		  	185 Berry Street, Suite 3000
		  	San Francisco, CA 94107
		  	Attn: Ben Columbo – Senior Relationship Manager
		  	 Fax: (415) 856-0810
 Email:
bcolombo@svb.com


 11 CHOICE OF LAW, VENUE, JURY TRIAL WAIVER AND JUDICIAL REFERENCE 
 California 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 Santa Clara County, California; provided, however, that nothing in this Agreement shall be deemed to operate to preclude Bank from bringing suit or taking other legal action in any other jurisdiction to realize on the
Collateral or any other security for the Obligations, or to enforce a judgment or other court order in favor of Bank. Borrower expressly submits and consents in advance to such jurisdiction in any action or suit commenced in any such court, and
Borrower hereby waives any objection that it may have based upon lack of personal jurisdiction, improper venue, or forum non conveniens and hereby consents to the granting of such legal or equitable relief as is deemed appropriate by such court.
Borrower hereby waives personal service of the summons, complaints, and other process issued in such action or suit and agrees that service of such summons, complaints, and other process may be made by registered or certified mail addressed to
Borrower at the address set forth in Section 10 of this Agreement and that service so made shall be deemed completed upon the earlier to occur of Borrower’s actual receipt thereof or three (3) days after deposit in the U.S. mails,
proper postage prepaid. 
 TO THE FULLEST 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. 
 WITHOUT INTENDING IN ANY WAY TO LIMIT THE
PARTIES’ AGREEMENT TO WAIVE THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY, if the above waiver of the right to a trial by jury is not enforceable, the parties hereto agree that any and all disputes or controversies of any nature between them
arising at any time shall be decided by a reference to a private judge, mutually selected by the parties (or, if they cannot agree, by the Presiding Judge of the Santa Clara County, California Superior Court) appointed in accordance with California
Code of Civil Procedure Section 638 (or pursuant to comparable provisions of federal law if the dispute falls within the exclusive jurisdiction of the federal courts), sitting without a jury, in Santa Clara County, California; and the parties
hereby submit to the jurisdiction of such court. The reference proceedings shall be conducted pursuant to and in accordance with the provisions of California Code of Civil Procedure §§ 638 through 645.1, inclusive. The private judge shall
have the power, among others, to grant provisional relief, including without limitation, entering temporary restraining orders, issuing preliminary and permanent injunctions and appointing receivers. All such proceedings shall be closed to the
public and confidential and all records relating thereto shall be permanently sealed. If during the course of any dispute, a party desires to seek provisional relief, but a judge has not been appointed at that point pursuant to the judicial
reference procedures, then such party may apply to the Santa Clara County, California Superior Court for such relief. The proceeding before the private judge shall be conducted in the same manner as it would be before a court under the rules of
evidence applicable to judicial proceedings. The parties shall be entitled to discovery which shall be conducted in the same manner as it would be before a court under the rules of discovery applicable to judicial proceedings. The private judge
shall oversee discovery and may 

  

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enforce all discovery rules and order applicable to judicial proceedings in the same manner as a trial court judge. The parties agree that the selected or
appointed private judge shall have the power to decide all issues in the action or proceeding, whether of fact or of law, and shall report a statement of decision thereon pursuant to the California Code of Civil Procedure § 644(a). Nothing in
this paragraph shall limit the right of any party at any time to exercise self-help remedies, foreclose against collateral, or obtain provisional remedies. The private judge shall also determine all issues relating to the applicability,
interpretation, and enforceability of this paragraph 
 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 (each, an “Indemnified Person”) 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 such Indemnified Person 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 such Indemnified Person’s gross negligence or willful misconduct. 
 12.3 Time of Essence. Time is of the essence for the performance of all Obligations in this Agreement. 
 12.4 Severability of Provisions. Each provision of this Agreement is severable from every other provision in determining the enforceability of any provision. 
 12.5 Correction of Loan Documents. Bank may correct patent errors and fill in any blanks in the Loan Documents consistent with the agreement of
the parties, so long as Bank provides Borrower with written notice of such correction and allows Borrower at least ten (10) days to object to such correction. In the event of such objection, such correction shall not be made except by an
amendment signed by both Bank and Borrower. 
 12.6 Amendments in Writing; Integration. All amendments to this Agreement must be in
writing and 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. 
 12.9 Confidentiality. In handling any confidential information, Bank shall exercise the same degree of care that it exercises for its own
proprietary information, 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; 

  

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(d) to Bank’s regulators or as otherwise required in connection with Bank’s examination or audit; (e) as Bank considers appropriate in
exercising remedies under the Loan Documents; and (f) to third-party service providers of Bank so long as such service providers have executed a confidentiality agreement with Bank with terms no less restrictive than those contained herein.
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. 
 Bank may use confidential
information for any purpose, including, without limitation, for the development of client databases, reporting purposes, and market analysis, so long as Bank does not disclose Borrower’s identity or the identity of any person associated with
Borrower unless otherwise expressly permitted by this Agreement. The provisions of the immediately preceding sentence shall survive the termination of this Agreement. 
 12.10 Attorneys’ Fees, Costs and Expenses. In any action or proceeding between Borrower and Bank arising out of or relating to the Loan Documents, the prevailing party shall be entitled to recover its
reasonable attorneys’ fees and other costs and expenses incurred, in addition to any other relief to which it may be entitled. 
 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. 
 “Advance” or “Advances” means an advance (or advances) under the Revolving Line. 
 “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. 
 “Availability Amount” is (a) the lesser of
(i) the Revolving Line or (ii) the amount available under the Borrowing Base minus (b) the outstanding principal balance of any Advances. 
 “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, amending, 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 or Guarantor. 
 “Basic
Rate” is the per annum rate of interest (based on a year of 360 days) equal to the sum of (a) U.S. Treasury note yield to maturity for a term equal to the Treasury Note Maturity as reported in the Federal Reserve Statistical Release
H.15-Selected Interest Rates under the heading “U.S. Government Securities/Treasury Constant Maturities” on the Funding Date of the Term Loan, plus (b) the Loan Margin. (In the event Release H.15 is no longer published, Bank shall
select a comparable publication to determine the U.S. Treasury note yield to maturity.) 
 “Borrower” is defined in
the preamble hereof 
  

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 “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 Base” is (a) fifty percent (50%) of Eligible Accounts plus (b) one hundred percent (100%) of unrestricted
Cash held at Bank in excess of all Obligations owing from Borrower to Bank. 
 “Borrowing Resolutions” are, with
respect to any Person, those resolutions substantially in the form attached hereto as Exhibit C. 
 “Business Day” is
any day that is not a Saturday, Sunday or a day on which Bank is closed. 
 “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. 
 “Change in Control” means any event, transaction, or occurrence as a result of which (a) any “person” (as such term is
defined in Sections 3(a)(9) and 13(d)(3) of the Securities Exchange Act of 1934, as an amended (the “Exchange Act”)), other than a trustee or other fiduciary holding securities under an employee benefit plan of Borrower, is or
becomes a beneficial owner (within the meaning Rule 13d-3 promulgated under the Exchange Act), directly or indirectly, of securities of Borrower, representing twenty-five percent (25%) or more of the combined voting power of Borrower’s
then outstanding securities; or (b) during any period of twelve consecutive calendar months, individuals who at the beginning of such period constituted the Board of Directors of Borrower (together with any new directors whose election by the
Board of Directors of Borrower was approved by a vote of at least two-thirds of the directors then still in office who either were directions at the beginning of such period or whose election or nomination for election was previously so approved)
cease for any reason other than death or disability to constitute a majority of the directors then in office. 
 “Code” is
the Uniform Commercial Code, as the same may, from time to time, be enacted and in effect in the State of California; 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 State of California, 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. 
 “Compliance Certificate” is that certain certificate in the form attached hereto as Exhibit D. 

“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 

  

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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. 
 “Credit Extension” is any Advance, the Term Loan or any other
extension of credit by Bank for Borrower’s benefit. 
 “Credit Party” means Borrower and Guarantor. 
 “Current Liabilities” are all obligations and liabilities of Borrower to Bank, plus, without duplication, the aggregate amount of
Borrower’s Total Liabilities that mature within one (1) year. 
 “Default Rate” is defined in Section 2.3(b).

 “Deferred Revenue” is all amounts received or invoiced in advance of performance under contracts and not yet
recognized as revenue. 
 “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 3300387250, maintained with Bank. 
 “Dollars,” “dollars” and
“$” each mean lawful money of the United States. 
 “Domestic Subsidiary” means a Subsidiary organized
under the laws of the United States or any state or territory thereof or the District of Columbia. 
 “EBITDA” shall mean
(a) Net Income, plus (b) Interest Expense, plus (c) to the extent deducted in the calculation of Net Income, depreciation expense and amortization expense, plus (d) income tax expense of Borrower and its Subsidiaries on a
consolidated basis, plus (e) non-cash compensation expenses or other non-cash expenses or charges incurred during such period arising from the sale of stock, the granting of stock options, stock appreciation rights and other similar
arrangements of Borrower and its Subsidiaries. 
 “Effective Date” is the date Bank executes this Agreement as
indicated on the signature page hereof. 
 “Eligible Accounts” means gross balance sheet Accounts receivable which
arise in the ordinary course of Borrower’s business that meet all Borrower’s representations and warranties in Section 5.3. 
 “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 Employee Retirement Income Security Act of 1974,
and its regulations. 
 “Event of Default” is defined in Section 8. 
  

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 “Foreign Currency” means lawful money of a country other than the United
States. 
 “Foreign Subsidiary” means any Subsidiary which is not a Domestic Subsidiary. 
 “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. 
 “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. 
 “Governmental Approval” is any consent, authorization, approval, order, license, franchise, permit, certificate, accreditation, registration, filing or notice, of, issued by, from or to, or other act
by or in respect of, any Governmental Authority. 
 “Governmental Authority” is any nation or government, any state or other
political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative functions of or pertaining to government,
any securities exchange and any self-regulatory organization. 
 “Guarantor” is any present or future guarantor of the
Obligations, including Reliant Technologies, Inc. 
 “Guaranty” means that certain Unconditional Guaranty executed by
Guarantor in favor of Bank dated as of March __, 2009. 
 “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. 
 “Indemnified Person” is defined in Section 12.2. 
 “Initial Audit” is Bank’s initial inspection of the Collateral. 
 “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. 
 “Interest Expense” means for any fiscal period, interest expense (whether cash or non-cash) determined in accordance with GAAP for the
relevant period ending on such date, including, in any event, interest expense with respect to any Credit Extension and other Indebtedness of Borrower and its Subsidiaries, including, without limitation or duplication, all commissions, discounts, or
related amortization and other fees and charges with respect to letters of credit and bankers’ acceptance financing and the net costs associated with interest rate swap, cap, and similar arrangements, and the interest portion of any deferred
payment obligation (including leases of all types). 
  

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 “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. 
 “IP Agreements” are those certain Intellectual Property Security
Agreements executed and delivered by Borrower and Guarantor to Bank dated as of March 9, 2009. 
 “Lien” is a claim,
mortgage, deed of trust, levy, charge, pledge, security interest or other encumbrance of any kind, whether voluntarily incurred or arising by operation of law or otherwise against any property. 
 “Liquidity” is, on any date, Borrower’s consolidated, unrestricted balance sheet cash plus fifty percent (50%) of Eligible
Accounts. 
 “Loan Documents” are, collectively, this Agreement, the Perfection Certificate, the IP Agreements, the
Guaranty, the Security Agreement, any note, or notes or guaranties executed by Borrower or any Guarantor, and any other present or future agreement between Borrower any Guarantor and/or for the benefit of Bank in connection with this Agreement, all
as amended, restated, or otherwise modified. 
 “Loan Margin” is five hundred one (501) basis points. 
 “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; or (c) a material impairment of the prospect of repayment of any portion of the
Obligations. 
 “Material Indebtedness” is any Indebtedness the principal amount of which is equal to or greater than
Two Hundred Fifty Thousand Dollars ($250,000). 
 “Net Income” means, as calculated on a consolidated basis for Borrower and
its Subsidiaries for any period as at any date of determination, the net profit (or loss), after provision for taxes, of Borrower and its Subsidiaries for such period taken as a single accounting period. 
 “Obligations” are any Credit Party’s obligation to pay when due any debts, principal, interest, Bank Expenses and other amounts any
Credit Party owes Bank now or later, whether under this Agreement, the Loan Documents, or otherwise, including, without limitation, all obligations relating to letters of credit (including reimbursement obligations for drawn and undrawn letters of
credit), cash management services, and foreign exchange contracts, if any, and including interest accruing after Insolvency Proceedings begin and debts, liabilities, or obligations of any Credit Party assigned to Bank, and the performance of any
Credit Party’s duties under the Loan Documents. 
 “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, (a) if such Person is a corporation, its bylaws in current form,
(b) if such Person is a limited liability company, its limited liability company agreement (or similar agreement), and (c) if such Person is a partnership, its partnership agreement (or similar agreement), each of the foregoing with all
current amendments or modifications thereto. 
  

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 “Payment/Advance Form” is that certain form attached hereto as Exhibit B.

 “Perfection Certificate” is defined in Section 5.1. 
 “Permitted Distributions” means: 
 (a) purchases of capital stock from former employees, consultants and directors pursuant to repurchase agreements or other similar agreements in an aggregate amount not to exceed One Hundred Thousand Dollars
($100,000) in any fiscal year provided that at the time of such purchase no Default or Event of Default has occurred and is continuing; 
 (b) distributions or dividends consisting solely of Borrower’s capital stock; 
 (c)
purchases for value of any rights distributed in connection with any stockholder rights plan; 
 (d) purchases of capital
stock or options to acquire such capital stock with the proceeds received from a substantially concurrent issuance of capital stock or convertible securities; 
 (e) purchases of capital stock pledged as collateral for loans to employees; 
 (f) purchases of capital stock in connection with the exercise of stock options or stock appreciation rights by way of cashless exercise
or in connection with the satisfaction of withholding tax obligations; 
 (g) purchases of fractional shares of capital stock
arising out of stock dividends, splits or combinations, or business combinations, or conversion of convertible securities; 
 (h) purchase, acquisition, redemption or retirement of stock options in connection with any stock option exchange provided that such exchange is on a cashless basis; and 
 (i) the settlement or performance of such Person’s obligations under any equity derivative transaction, option contract or similar
transaction or combination of transactions. 
 “Permitted Indebtedness” is: 
 (j) Borrower’s Indebtedness to Bank under this Agreement and any other Loan Document; 
 (k) any Indebtedness existing on the Effective Date and shown on the Perfection Certificate; 
 (l) Subordinated Debt; 
 (m) unsecured Indebtedness to trade creditors and with respect to surety bonds and similar obligations incurred in the ordinary course of business; 
 (n) guaranties of Permitted Indebtedness; 
 (o) Indebtedness incurred as a result of endorsing negotiable instruments received in the ordinary course of business; 
 (p) Indebtedness consisting of interest rate, currency, or commodity swap agreements, interest rate cap or collar agreements or arrangements designated to protect Borrower against fluctuations in interest rates,
currency exchange rates, or commodity prices; 
 (q) Indebtedness between Borrower and any of its Subsidiaries or among any of
Borrower’s Subsidiaries; 
  

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 (r) Indebtedness with respect to documentary letters of credit; 
 (s) capitalized leases and purchase money Indebtedness not to exceed Four Hundred Thousand Dollars ($400,000) in the aggregate in any
fiscal year secured by Permitted Liens; 
 (t) Indebtedness of entities acquired in any permitted merger or acquisition
transaction; 
 (u) Indebtedness of up to Seven Million One Hundred Thousand Dollars ($7,100,000) in principal amount in
connection with the Margin Loan until the date which is one (1) year from the Effective Date; and 
 (v) refinanced
Permitted Indebtedness, provided that the amount of such Indebtedness is not increased except by an amount equal to a reasonable premium or other reasonable amount paid in connection with such refinancing and by an amount equal to any existing, but
unutilized, commitment thereunder; and 
 (w) other Indebtedness, if, on the date of incurring any Indebtedness pursuant to
this clause (m), the outstanding aggregate amount of all Indebtedness incurred pursuant to this clause (m) does not exceed one percent (1.00%) of Borrower’s consolidated total assets calculated as of the end of the immediately prior
fiscal quarter. 
 “Permitted Investments” are: 
 (x) Investments existing on the Effective Date; 
 (y) (i) marketable direct obligations issued or unconditionally guaranteed by the United States or its agencies or any State maturing
within 1 year from its acquisition, (ii) commercial paper maturing no more than 2 years after its creation and having the highest rating from either Standard & Poor’s Corporation or Moody’s Investors Service, Inc., and
(iii) Bank’s certificates of deposit maturing no more than 2 years after issue; 
 (z) Investments approved by the
Borrower’s Board of Directors or otherwise pursuant to a Board-approved investment policy; 
 (aa) Investments in or to
Borrower or any of its Subsidiaries; 
 (bb) Investments consisting of Collateral Accounts in the name of Borrower or any
Subsidiary so long as Bank has a first priority, perfected security interest in such Collateral Accounts; 
 (cc) Investments
consisting of extensions of credit to Borrower’s or its Subsidiaries’ customers in the nature of accounts receivable, prepaid royalties or notes receivable arising from the sale or lease of goods, provision of services or licensing
activities of Borrower; 
 (dd) Investments received in satisfaction or partial satisfaction of obligations owed by
financially troubled obligors; 
 (ee) Investments acquired in exchange for any other Investments in connection with or as a
result of a bankruptcy, workout, reorganization or recapitalization; 
 (ff) Investments acquired as a result of a foreclosure
with respect to any secured Investment; 
 (gg) Investments consisting of interest rate, currency, or commodity swap
agreements, interest rate cap or collar agreements or arrangements designated to protect a Person against fluctuations in interest rates, currency exchange rates, or commodity prices; 
 (hh) Investments consisting of loans and advances to employees in an aggregate amount not to exceed One Hundred Thousand Dollars
($100,000); and 
  

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 (ii) other Investments, if, on the date of incurring any Investments pursuant to this
clause (l), the outstanding aggregate amount of all Investments incurred pursuant to this clause (l) does not exceed one percent (1.00%) of Borrower’s consolidated total assets calculated as of the end of the immediately prior fiscal
quarter. 
 “Permitted Liens” are: 
 (jj) (i) Liens securing Permitted Indebtedness described under clauses (b) and (c) of the definition of “Permitted
Indebtedness”, (ii) Liens arising under this Agreement or other Loan Documents or (iii) Liens existing as of the Effective Date and disclosed on the Perfection Certificate; 
 (kk) 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, provided that no notice of any such Lien has been filed or recorded under the Internal Revenue Code of 1986, as amended, and the Treasury Regulations adopted thereunder; 

(ll) Liens (including with respect to capital leases) (i) on property (including accessions, additions, parts, replacements,
fixtures, improvements and attachments thereto, and the proceeds thereof) acquired or held by Borrower or its Subsidiaries incurred for financing such property (including accessions, additions, parts, replacements, fixtures, improvements and
attachments thereto, and the proceeds thereof) other than Accounts, Inventory, and Financed Equipment, or (ii) existing on property (and accessions, additions, parts, replacements, fixtures, improvements and attachments thereto, and the
proceeds thereof) when acquired other than Accounts, Inventory, and Financed Equipment, if the Lien is confined to such property (including accessions, additions, parts, replacements, fixtures, improvements and attachments thereto, and the proceeds
thereof); 
 (mm) Liens incurred in the extension, renewal or refinancing of the indebtedness secured by Liens described in
(a) through (c), 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 it secures may not increase; 
 (nn) leases or subleases of real property granted in the ordinary course of business, and leases, subleases, non-exclusive licenses or
sublicenses of property (other than real property or intellectual property) granted in the ordinary course of Borrower’s business, if the leases, subleases, licenses and sublicenses do not prohibit granting Bank a security interest;

 (oo) (i) non-exclusive license of intellectual property granted to third parties in the ordinary course of business,
(ii) licenses of intellectual property that could not result in a legal transfer of title of the licensed property that may be exclusive in respects other than territory and that may be exclusive as to territory only as to discreet geographical
areas outside of the United States and (iii) perpetual exclusive licenses with respect to fields of use outside of the “aesthetic field of use”; 
 (pp) leases or subleases granted in the ordinary course of Borrower’s business, including in connection with Borrower’s leased
premises or leased property; 
 (qq) Liens in favor of custom and revenue authorities arising as a matter of law to secure the
payment of custom duties in connection with the importation of goods; 
 (rr) Liens on insurance proceeds securing the payment
of financed insurance premiums; 
 (ss) customary Liens granted in favor of a trustee to secure fees and other amounts owing
to such trustee under an indenture or other similar agreement; 
 (tt) Liens on assets acquired in mergers and acquisitions
not prohibited by Section 7 of this Agreement; 
 (uu) Liens consisting of pledges of cash, cash equivalents or
government securities to secure swap or foreign exchange contracts or letters of credit; 
  

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 (vv) Liens arising from attachments or judgments, orders, or decrees in circumstances not
constituting an Event of Default under Sections 8.4 and 8.7; 
 (ww) Liens on the Bear Stearns Margin Account securing the
Margin Loan; 
 (xx) Liens in favor of other financial institutions arising in connection with Borrower’s deposit or
securities accounts held at such institutions; 
 (yy) Liens of carriers, warehousemen, suppliers, or other Persons that are
possessory in nature arising in the ordinary course of business so long as such Liens attach only to Inventory, securing liabilities in the aggregate amount not to exceed One Hundred Thousand Dollars ($100,000) and which are not delinquent or remain
payable without penalty or which are being contested in good faith and by appropriate proceedings which proceedings have the effect of preventing the forfeiture or sale of the property subject thereto; 
 (zz) Liens to secure payment of workers’ compensation, employment insurance, old-age pensions, social security and other like
obligations incurred in the ordinary course of business (other than Liens imposed by ERISA); 
 (aaa) deposits to secure the
performance of bids, trade contracts (other than for borrowed money), contracts for the purchase of property, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case, incurred in
the ordinary course of business and not representing an obligation for borrowed money; and 
 (bbb) Liens not otherwise
permitted, provided that (i) the amount of all such Liens is not in excess of one percent (1.00%) of Borrower’s consolidated total assets calculated as of the end of the immediately prior fiscal quarter (with any such Lien valued as
the amount of the obligation secured by such Lien) and (ii) such Liens are subordinate in priority to Bank’s Lien hereunder. 
 “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 
 “Requirement of Law”
is as to any Person, the organizational or governing documents of such Person, and any law (statutory or common), treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or
binding upon such Person or any of its property or to which such Person or any of its property is subject. 
 “Responsible
Officer” is any of the Chief Executive Officer, President, Chief Financial Officer and Controller of Borrower. 
 “Revolving
Line” is an Advance or Advances in an amount equal to Six Million Dollars ($6,000,000). 
 “Revolving Line Maturity
Date” is March 9, 2011. 
 “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 (a) Indebtedness incurred by
Borrower subordinated to Borrower’s Indebtedness owed to Bank and which is reflected in a written agreement in a manner and form reasonably acceptable to Bank and approved by Bank in writing, and (b) to the extent the terms of
subordination do not change adversely to Bank, refinancings, refundings, renewals, amendments or extensions of any of the foregoing. 
  

 - 26 - 








 “Subsidiary” means, with respect to any Person, any Person of which more than 50.0% of
the voting stock or other equity interests (in the case of Persons other than corporations) is owned or controlled directly or indirectly by such Person or one or more of Affiliates of such Person. 
 “Tangible Net Worth” is, on any date, the consolidated total assets of Borrower and Guarantor minus (a) any amounts
attributable to (i) goodwill, (ii) intangible items including unamortized debt discount and expense, patents, trade and service marks and names, copyrights and research and development expenses except prepaid expenses, (iii) notes,
accounts receivable and other obligations owing to Borrower from its officers or other Affiliates, and (iv) reserves not already deducted from assets, minus (b) Total Liabilities. 
 “Term Loan” is a loan made by Bank pursuant to the terms of Section 2.1.2 hereof. 
 “Term Loan Amount” is an amount equal Three Million Dollars ($3,000,000). 
 “Term Loan Maturity Date” is November 1, 2011. 
 “Term Loan Payment” is defined in Section 2.1.2(b). 
 “Total
Liabilities” is on any day, obligations that should, under GAAP, be classified as liabilities on Borrower’s consolidated balance sheet, including all Indebtedness. 
 “Transfer” is defined in Section 7.1. 
 “Treasury Note Maturity” is thirty six (36) months. 
 [Signature page follows.]

  

 - 27 - 








 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the
Effective Date. 
  

			
	BORROWER:
	
	SOLTA MEDICAL, INC.
		
	By	 	/s/ John F. Glenn
	Name:	 	John F. Glenn
	Title:	 	CFO
	
	BANK:
	
	SILICON VALLEY BANK
		
	By	 	/s/ Ben Colombo
	Name:	 	Ben Colombo
	Title:	 	Senior Relationship Manager


			
	Effective Date:	 	3/9/2009








 EXHIBIT A – COLLATERAL DESCRIPTION 
 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, 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 or anything else contained herein to the contrary, “Collateral” shall not include (i) property that is nonassignable by its terms without the consent of the licensor
thereof or another party, or equipment subject to a lien described in subsection (c) of the defined term “Permitted Liens” and subject to a negative pledge (but in each case, only to the extent such prohibition on transfer or negative
pledge is enforceable under applicable law, including, without limitation, Sections 9406 and 9408 of the Code), or (ii) property, the granting of a security interest therein is contrary to applicable law, provided that upon the cessation of any
such restriction or prohibition, such property shall automatically become part of the Collateral; (iii) more than sixty five percent (65%) of the presently existing and hereafter arising issued and outstanding shares of capital stock owned
by Borrower of any Foreign Subsidiary which shares entitle the holder thereof to vote for directors or any other matter or (iv) any application for a trademark (including, without limitation, intent-to-use trademark or service applications and
any goodwill associated therewith) that would otherwise be deemed invalidated, cancelled or abandoned due to the grant of a Lien thereon unless and until such time as the grant of such Lien will not affect the validity of such trademark. All defined
terms shall have the meanings ascribed in that certain Loan and Security Agreement between Debtor and Silicon Valley Bank dated March 9, 2009. 







 EXHIBIT B 
 Loan Payment/Advance Request Form 
 DEADLINE FOR
SAME DAY PROCESSING IS NOON P.S.T.* 
  

			
	Fax To:	  	Date:                         

 LOAN PAYMENT: 
 SOLTA MEDICAL, INC. 
  

											
	From Account #	 	 	  		  	To Account #	 	 	  	
		 	(Deposit Account #)	  		  		 	(Loan Account #)            	  	


											
						
	Principal $ 	 	 	 		  	and/or Interest $	  	 	  	

 Authorized Signature:
                                         
                                         
  Phone Number:
                                         
              
 Print Name/Title:
                                         
                              
 LOAN ADVANCE: 
 Complete Outgoing Wire Request section below if all or a portion
of the funds from this loan advance are for an outgoing wire. 
  

											
	From Account #	 	 	  		  	To Account #	 	 	  	
		 	(Loan Account #)	  		  		 	(Deposit Account #)	  	


											
						
	Amount of Advance $	 	 	  		  		  		  	

 All Borrower’s representations and warranties in the Loan and Security Agreement are true, correct and
complete in all material respects on the date of the request for an advance; 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: 
 Authorized Signature:
                                         
                                         
  Phone Number:
                                         
        
 Print Name/Title:
                                         
                              
 OUTGOING WIRE REQUEST: 
 Complete only if all or a portion of funds
from the loan advance above is to be wired. 
 Deadline for same day processing is noon, P.S.T. 
 Beneficiary Name:
                                         
                                   
                Amount of Wire:
$                                         
                
 Beneficiary Bank:
                                         
                                    
                Account Number:
                                         
                 
 City and State:
                                         
                                         

 Beneficiary Bank Transit (ABA) #:
                                         
               Beneficiary Bank Code (Swift, Sort, Chip, etc.):
                     
                                        
                                         
        (For International Wire Only) 
 Intermediary Bank:
                                         
                                        Transit
(ABA)
#:                                        
                                
 For Further Credit to:
                                         
                                         
                                         
                                         
              
 Special Instruction:
                                         
                                         
                                         
                                         
                 
 By signing below, I (we) acknowledge and agree that
my (our) funds transfer request shall be processed in accordance with and subject to the terms and conditions set forth in the agreements(s) covering funds transfer service(s), which agreements(s) were previously received and executed by me (us).

 Authorized Signature:
                                         
                                     2nd Signature (if required):
                                         
        
 Print Name/Title:
                                         
                                         
   Print Name/Title:
                                         
                       
     Telephone #:
                                         
                                       Telephone #:
                 
     ____________________________ 
     Unless otherwise provided for an Advance bearing
interest at LIBOR. 







 EXHIBIT C 
 Borrowing Resolutions 
 [Please see attached] 







 EXHIBIT D - COMPLIANCE CERTIFICATE 
  

									
		 		 	
					
	TO:	 	SILICON VALLEY BANK	 		 	Date:	 	 
	FROM:	 	SOLTA MEDICAL, INC.	 		 		 	

 The undersigned authorized officer of SOLTA MEDICAL, INC. (“Borrower”) certifies that
under the terms and conditions of the Loan and Security Agreement between Borrower and Bank (the “Agreement”), (1) Borrower is in complete compliance for the period ending
                    with all required covenants except as noted below, (2) there are no Events of Default, (3) all representations
and warranties in the Agreement are true and correct in all material respects on this date except as noted below; 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,
(4) Borrower, and each of its Subsidiaries, has timely filed all required tax returns and reports, and Borrower has timely paid all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower except as
otherwise permitted pursuant to the terms of Section 5.9 of the Agreement, and (5) no Liens have been levied or claims made against Borrower or any of its Subsidiaries relating to unpaid employee payroll or benefits of which Borrower has
not previously provided written notification to Bank. Attached are the required documents supporting the certification. The undersigned certifies that these are prepared in accordance with GAAP consistently applied from one period to the next except
(i) as explained in an accompanying letter or footnotes and (ii) with respect to unaudited financials for the absence of footnotes and subject to year-end adjustments. The undersigned acknowledges that no borrowings may be requested at any
time or date of determination that Borrower is not in compliance with any of the terms of the Agreement, and that compliance is determined not just at the date this certificate is delivered. Capitalized terms used but not otherwise defined herein
shall have the meanings given them in the Agreement. 
 Please indicate compliance status by circling Yes/No under “Complies” column.


					
	  
	 Reporting Covenant
	  	 Required
	  	Complies
			
	 Monthly financial statements with
     Compliance Certificate
	  	Monthly within 30 days	  	Yes    No
			
	Annual Financial Projections	  	Within 7 days of approval by board	  	Yes    No
			
	10-Q, 10-K and 8-K	  	Within 5 days after filing with SEC	  	Yes    No
			
	 A/R & A/P Agings, Deferred Revenue
     Report
	  	Monthly within 30 days	  	Yes    No
	
	The following Intellectual Property was registered (or a registration application submitted) after the Effective Date (if no registrations, state “None”)

  

							
	 Financial Covenant
	  	 Required
	  	 Actual
	  	 Complies

	 Minimum Liquidity Ratio
	  	1.65:1.00	  	            :1.00	  	Yes    No
	 Minimum Quarterly EBITDA (beginning with the quarter ending 12/31/09)
	  	$1.00	  	$            	  	Yes    No
	 Minimum Tangible Net Worth
	  	$14,000,000	  	$            	  	Yes    No

 The following financial covenant analyses and information set forth in Schedule 1 attached hereto
are true and accurate as of the date of this Certificate. 







 The following are the exceptions with respect to the certification above: (If no exceptions exist, state
“No exceptions to note.”) 
  
  
  
  
  
  
  

									
	SOLTA MEDICAL, INC.	 		 	BANK USE ONLY
					
	By:	 	 	 		 	Received by:	 	 
	Name:	 	 	 		 		 	AUTHORIZED SIGNER
	Title:	 	 	 		 	Date:	 	 
		 		 		 	Verified:	 	 
		 		 		 		 	AUTHORIZED SIGNER
		 		 		 	Date:	 	 
		 		 		 	Compliance Status:     Yes     No








 Schedule 1 to Compliance Certificate 
 Financial Covenants of Borrower 
 In the event of a conflict between this Schedule and the Loan Agreement, the terms of the Loan Agreement shall govern. 
 Dated:
                         
 I.
Liquidity Ratio (Section 6.7(a)) 
 Required: 1.65:1.00 
 Actual: 
  

						
	 A.
	  	Aggregate value of the unrestricted balance sheet cash of Borrower and Guarantor	  	$	_______
			
	 B.
	  	50% of the aggregate value of Eligible Accounts	  	$	_______
			
	 C.
	  	Liquidity (line A plus line B)	  	$	_______
			
	 D.
	  	Aggregate value of Obligations to Bank	  	$	_______
			
		  		  	 	_______
			
	 E.
	  	Liquidity Ratio (line C divided by line D)	  		

 Is line E equal to or greater than 1.65:1:00? 
  

			
	                  No, not in compliance
	  	                Yes, in compliance









	II.	Quarterly EBITDA (Section 6.7(b)) 

 Required: $1.00 
 Actual: 
  

						
			
	 A.
	  	Net Income	  	$	            
			
	 B.
	  	To the extent included in the determination of Net Income	  		
			
		  	 1.      The provision for income taxes
	  	$	            
			
		  	 2.      Depreciation expense
	  	$	            
			
		  	 3.      Amortization expense
	  	$	            
			
		  	 4.      Net Interest Expense
	  	$	            
			
		  	 5.      non-cash compensation expenses or other non-cash expenses or charges incurred during such period
arising from the sale of stock, the granting of stock options, stock appreciation rights and other similar arrangements of Borrower and its Subsidiaries
	  		
			
		  	 6.      The sum of lines 1 through 5
	  	$	            
			
	 C.
	  	EBITDA (line A plus line B.6)	  	$	            

 Is line C equal to or greater than $1.00 
  

			
	              No, not in compliance
	  	             Yes, in compliance











	III.	Tangible Net Worth (Section 6.7(c)) 

 Required: $14,000,000

 Actual: 
  

						
			
	 A.
	  	Aggregate value of total assets of Borrower and Guarantor	  	$	            
			
	 B.
	  	Aggregate value of goodwill of Borrower and Guarantor	  	$	            
			
	 C.
	  	Aggregate value of intangible assets of Borrower and Guarantor	  	$	            
			
	 D.
	  	Aggregate value of obligations owing to Borrower or Guarantor from officers or Affiliates	  	$	            
			
	 E.
	  	Aggregate value of any reserves not already deducted from assets	  	$	            
			
	 F.
	  	Aggregate value of all obligations that should, under GAAP, be classified as liabilities on Borrower’s consolidated balance sheet, including all Indebtedness	  	$	            
			
	 G.
	  	Tangible Net Worth (line A minus line B minus line C minus line D minus line E minus line F)	  	$	            

 Is line G equal to or greater than $14,000,000? 
  

			
	              No, not in compliance
	  	             Yes, in compliance










 EXHIBIT E 
 Margin Loan Documentation 
 [please see attached]