Document:

Amendment No. 1 to Supplement to Loan and Security Agreement

 Exhibit 10.7A 
 AMENDMENT NO. 1 
 TO SUPPLEMENT 
 TO LOAN AND SECURITY AGREEMENT 
 This Amendment No. 1 to Supplement to Loan
and Security Agreement (this “Amendment”) is made as of August 28, 2007, by and between EnteroMedics Inc., a Delaware corporation (“Borrower”), and each of Venture Lending & Leasing IV, Inc., a
Maryland corporation (“VLL4”), and Venture Lending & Leasing V, Inc., a Maryland corporation (“VLL5”). Each of VLL4 and VLL5 is referred to herein as “Lender”. 
 Recitals 
 A. Borrower and each
Lender entered into that certain Loan and Security Agreement, and that certain Supplement to Loan and Security Agreement, both dated as of May 17, 2007 (the “Loan Agreement” and “Supplement,” respectively);

 B. Borrower and Lender wish to amend the Loan Agreement and Supplement to reflect, among other things, that: (i) the Termination Date
for the availability of a portion of the Second Tranche of the Commitment will be extended; and (ii) certain other provisions of the Loan Agreement and Supplement will be modified on the terms and subject to the conditions set forth herein; and

 C. Except where the context otherwise requires, or unless this Amendment otherwise provides, all words and expressions defined in the Loan
Agreement and Supplement when used or referred to in this Amendment shall have the same meaning as those provided for in the Loan Agreement and Supplement. 
 NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, it is agreed by and between Borrower and Lender as follows: 
 1. Amendment to Part 1 of Supplement. The definition of “Termination Date” in Part 1 of the Supplement is hereby amended and restated in
their entirety as follows: 
 “Termination Date”: The Termination Date is the earlier of: (i) the date
Lender may terminate making Loans or extending other credit pursuant to the rights of Lender under Article 7 of the Loan and Security Agreement, or (ii)(A) with respect to the First Tranche of the Commitment, May 25, 2007; and
(B) with respect to the Second Tranche of the Commitment, August 31, 2007; provided, that such date shall be extended from August 31, 2007 to October 31, 2007 with respect to fifty percent (50%) of the Second
Tranche of the Commitment (i.e., $1,250,000 per Lender). 
 2. Amendment to Part 2 of Supplement. Section 1(c) of Part 2 of the
Supplement is hereby amended and restated in its entirety as follows 
 (c) Repayment of Growth Capital Loans.

 (i) Repayment of Growth Capital Loans funded on or before August 31, 2007. Principal of and interest on each
Growth Capital Loan funded on or before August 31, 2007 shall be payable as set forth in a Note (substantially in the form of Exhibit “A” hereto) evidencing such Loan, which Note shall provide substantially as follows:
principal and interest at the Designated Rate shall be fully amortized over a period of 30 months in equal, monthly installments, commencing after an initial 6-month period of interest-only, monthly payments. In particular, on the Borrowing Date
applicable to the Growth Capital Loan evidenced by such Note, Borrower shall pay to Lender (i) if the Borrowing Date is not the first day of the month interest only at the 

 
Interest-Only Rate, in advance, on the outstanding principal balance of the Loan evidenced by such Note, for the period from such Borrowing Date through the
last day of the calendar month in which such Borrowing Date occurs, and (ii) a first (1st) interest only installment at the Interest-Only Rate,
in advance, on the outstanding principal balance of the Note for the ensuing month. Commencing on the first day of the second full month after the Borrowing Date, and continuing on the first day of the third through the sixth full months after the
Borrowing Date, Borrower shall pay interest only at the Interest-Only Rate, in advance, on the outstanding principal balance of this Note for the ensuing month. Commencing on the first day of the seventh full calendar month after the Borrowing Date,
and continuing on the first day of each consecutive calendar month thereafter, principal and interest at the Designated Rate shall be payable, in advance, in 30 equal consecutive installments in an amount sufficient to fully amortize the Loan
evidenced by such Note. Borrower shall pay the Terminal Payment on the date of the last amortization payment. 
 (i) Repayment of Growth Capital Loans funded on or after September 1,
2007. Principal of and interest on each Growth Capital Loan funded on or after September 1, 2007 shall be payable as set forth in a Note (substantially in the form of Exhibit “A” hereto) evidencing such Loan, which Note
shall provide substantially as follows: principal and interest at the Designated Rate shall be fully amortized over a period of 30 months in equal, monthly installments, commencing after an initial 4-month period of interest-only, monthly payments.
In particular, on the Borrowing Date applicable to the Growth Capital Loan evidenced by such Note, Borrower shall pay to Lender (i) if the Borrowing Date is not the first day of the month interest only at the Interest-Only Rate, in
advance, on the outstanding principal balance of the Loan evidenced by such Note, for the period from such Borrowing Date through the last day of the calendar month in which such Borrowing Date occurs, and (ii) a first (1st) interest only installment at the Interest-Only Rate, in advance, on the outstanding principal balance of the Note for the ensuing month. Commencing on
the first day of the second full month after the Borrowing Date, and continuing on the first day of each of the third and the fourth full months after the Borrowing Date, Borrower shall pay interest only at the Interest-Only Rate, in advance, on the
outstanding principal balance of this Note for the ensuing month. Commencing on the first day of the fifth full calendar month after the Borrowing Date, and continuing on the first day of each consecutive calendar month thereafter, principal and
interest at the Designated Rate shall be payable, in advance, in 30 equal consecutive installments in an amount sufficient to fully amortize the Loan evidenced by such Note. Borrower shall pay the Terminal Payment on the date of the last
amortization payment. 
 3. Amendment to Part 4 of Supplement. Exhibit “A” to the Supplement, the form of Promissory
Note, is hereby amended and restated in its entirety by Exhibit “A” attached to this Amendment. 
 4. Conditions to
Effectiveness. This Amendment shall be effective upon the delivery to Lender or its counsel of Borrower’s original counterpart signature pages hereto. 
 5. Borrower’s Representations. Borrower hereby represents and warrants to Lender that: Borrower has full corporate power and authority to execute and deliver this Amendment, and to perform the obligations
of its part to be performed hereunder and under the Loan Agreement and Supplement as amended hereby; Borrower has taken all necessary action, corporate or otherwise, to authorize the execution and delivery of this Amendment; no consent, approval or
authorization of any Person (other than any of the foregoing as has been obtained or will be timely obtained by Borrower) is or will be required in connection with the execution or delivery by Borrower of this Amendment or the performance by
Borrower of the Loan Agreement and Supplement as amended hereby; and this Amendment, and the Loan Agreement and Supplement as amended hereby each are, or upon delivery thereof to 

 
Lender will be, the legal, valid and binding obligations of Borrower, enforceable against Borrower in accordance with their respective terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally. 
 6.
Miscellaneous. 
 6.1 This Amendment may be executed in any number of counterparts and by facsimile or other means of
electronic transmission with the same effect as if the parties had all signed the same document in ink. All counterparts shall be construed together and shall constitute one instrument. 
 6.2 This Amendment, together with the Loan Agreement and Supplement, expresses the entire understanding of the parties with respect to the
transactions contemplated hereby. No prior negotiations or discussions shall limit, modify or otherwise affect the provisions hereof. 
 6.3 Any determination that any provision of this Amendment or any application hereof is invalid, illegal or unenforceable in any respect and in any instance shall not effect the validity, legality or enforceability of
such provision in any other instances, or the validity, legality or enforceability of any other provisions of this Amendment. 
 6.4 In the event of any conflict, inconsistency, or incongruity between any provision of this Amendment and any provision of the Loan Agreement and Supplement, the provisions of this Amendment shall govern and control. 
 6.5 Except as provided herein, all terms and conditions of the Supplement, the Loan Agreement and the other Loan Documents remain in full
force and effect. Borrower hereby ratifies, confirms and reaffirms all representations, warranties and covenants contained therein. To its current actual knowledge, Borrower acknowledges and agrees that Borrower does not have any offsets, defenses
or counterclaims against Lender thereunder. 
 6.6 This Amendment shall be construed and enforced in accordance with, and the
rights of the parties shall be governed by, the laws of the State of California without regarding to conflicts of law. 
 [Signature page
follows] 

 IN WITNESS WHEREOF, the parties have executed this Amendment as of the date first written above.

  

									
	BORROWER:	 		 	ENTEROMEDICS INC.
					
		 		 		 	By:	 	/s/ Mark Knudson
		 		 		 	Name:	 	Mark Knudson
		 		 		 	Title:	 	President and CEO

  

									
	LENDER:	 		 	VENTURE LENDING & LEASING IV, INC.
					
		 		 		 	By:	 	/s/ Ronald W. Swenson
		 		 		 	Name:	 	Ronald W. Swenson
		 		 		 	Title:	 	Chief Executive Officer

  

									
	LENDER:	 		 	VENTURE LENDING & LEASING V, INC.
					
		 		 		 	By:	 	/s/ Ronald W. Swenson
		 		 		 	Name:	 	Ronald W. Swenson
		 		 		 	Title:	 	Chief Executive Officer

 EXHIBIT “A” 
 [Note No. X-XXX] 
  

			
	$                            	  	                            ,
200__
		  	San Jose, California

 The undersigned (“Borrower”) promises to pay to the order of VENTURE LENDING &
LEASING [IV/V], INC., a Maryland corporation (“Lender”), at its office at 2010 North First Street, Suite 310, San Jose, California 95131, or at such other place as Lender may designate in writing, in lawful money of the United
States of America, the principal sum of ______________________________ Dollars ($__________), with Basic Interest thereon from the date hereof until maturity, whether scheduled or accelerated, at a fixed rate per annum equal to [the Prime Rate
(as defined in the Loan Agreement referred to below) as published on the Business Day on which Lender prepares this Note following Borrower’s submission of the Borrowing Request therefor, plus 2.00% but not less than 10.25%) (the
“Designated Rate”), except as otherwise provided herein, according to the payment schedule described herein, and a Terminal Payment in the sum of [3.10% of face amount of Loan] Dollars ($__________) payable on the Maturity
Date. 
 This Note is one of the Notes referred to in, and is entitled to all the benefits of, a Loan and Security Agreement dated as of
May 17, 2007, between Borrower and Lender (as the same have been and may be amended, restated and supplemented from time to time, the “Loan Agreement”). Each capitalized term not otherwise defined herein shall have the meaning set
forth in the Loan Agreement. The Loan Agreement contains provisions for the acceleration of the maturity of this Note upon the happening of certain stated events. 
 Principal of and interest on this Note shall be payable as follows: 
 [if Loan funded on or before August 31, 2007
then use the next 3 paragraphs] 
 On the Borrowing Date, Borrower shall pay [if the Borrowing Date is not the first day of the
month interest at a rate equal to [the Prime Rate as published on the Business Day on which Lender prepares this Note plus 4.23%, but in no event less than 12.48%], in advance, on the outstanding principal balance of this Note for the
period from the Borrowing Date through [the last day of the same month]___; and (ii)] interest only at a rate equal to [the Prime Rate as published on the Business Day on which Lender prepares this Note plus 4.23%, but in no
event less than 12.48%] (the “Interest-Only Rate”) in advance, on the outstanding principal balance of this Note in the amount of $_____________ for the month of [date of first regular interest only payment].

 Commencing on the first day of the second full month after the Borrowing Date, and continuing on the first day of the third through the
sixth full months after the Borrowing Date, Borrower shall make payments, in advance, of interest only at the Interest-Only Rate on the principal balance outstanding hereunder in the amount of $_____________ each. 
 Commencing on the first day of the seventh full month after the Borrowing Date, and continuing on the first day of each consecutive month thereafter,
principal and Basic Interest at the Designated Rate shall be payable, in advance, in thirty (30) equal consecutive installments of _________________________________ Dollars ($__________) each. The Terminal Payment and unpaid expenses, fees,
interest and principal amount shall be due and payable on ________________________ 200__.] 
 [if Loan funded on or after September 1, 2007 then use
the next 3 paragraphs] 
 On the Borrowing Date, Borrower shall pay [if the Borrowing Date is not the first day of the
month interest at a rate equal to [the Prime Rate as published on the Business Day on which Lender prepares this Note plus 

 
4.23%, but in no event less than 12.48%], in advance, on the outstanding principal balance of this Note for the period from the Borrowing Date through
[the last day of the same month]___; and (ii)] interest only at a rate equal to [the Prime Rate as published on the Business Day on which Lender prepares this Note plus 4.23%, but in no event less than 12.48%] (the
“Interest-Only Rate”) in advance, on the outstanding principal balance of this Note in the amount of $_____________ for the month of [date of first regular interest only payment]. 
 Commencing on the first day of the second full month after the Borrowing Date, and continuing on the first day of the third and the fourth full months
after the Borrowing Date, Borrower shall make payments, in advance, of interest only at the Interest-Only Rate on the principal balance outstanding hereunder in the amount of $_____________ each. 
 Commencing on the first day of the fifth full month after the Borrowing Date, and continuing on the first day of each consecutive month thereafter,
principal and Basic Interest at the Designated Rate shall be payable, in advance, in thirty (30) equal consecutive installments of _________________________________ Dollars ($__________) each. The Terminal Payment and unpaid expenses, fees,
interest and principal amount shall be due and payable on ________________________ 200__.] 
 This Note may be voluntarily prepaid only as
permitted under Section 2 of Part 2 of the Supplement to the Loan Agreement. 
 Any unpaid payments of principal or interest on this
Note shall bear interest from their respective maturities, whether scheduled or accelerated, at a rate per annum equal to the Default Rate. Borrower shall pay such interest on demand. 
 Interest, charges and fees shall be calculated for actual days elapsed on the basis of a 360-day year, which results in higher interest, charge or fee
payments than if a 365-day year were used. In no event shall Borrower be obligated to pay interest, charges or fees at a rate in excess of the highest rate permitted by applicable law from time to time in effect. 
 If Borrower is late in making any payment under this Note by more than five (5) Business Days, Borrower agrees to pay a “late charge” of
five percent (5%) of the installment due, but not less than fifty dollars ($50.00) for any one such delinquent payment. This late charge may be charged by Lender for the purpose of defraying the expenses incidental to the handling of such
delinquent amounts. Borrower acknowledges that such late charge represents a reasonable sum considering all of the circumstances existing on the date of this Note and represents a fair and reasonable estimate of the costs that will be sustained by
Lender due to the failure of Borrower to make timely payments. Borrower further agrees that proof of actual damages would be costly and inconvenient. Such late charge shall be paid without prejudice to the right of Lender to collect any other
amounts provided to be paid or to declare a default under this Note or any of the other Loan Documents or from exercising any other rights and remedies of Lender. 
 This Note shall be governed by, and construed in accordance with, the laws of the State of California, without regard to its conflict of laws provisions. 
  

			
	ENTEROMEDICS INC.
		
	By:	 	 
	Name:	 	 
	Its:Form of warrant

 Exhibit 10.1 
 NEITHER THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON EXERCISE OF THESE SECURITIES HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT,
THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT SECURED BY SUCH SECURITIES. 

VERI-TEK INTERNATIONAL, CORP. 
 WARRANT 
  

			
	Warrant No. [    ]	  	Original Issue Date: September     , 2007

 Veri-Tek International, Corp., a Michigan corporation (the “Company”), hereby
certifies that, as partial compensation for placement agent services, Roth Capital Partners, LLC or its registered assigns (the “Holder”), is entitled to purchase from the Company up to a total of 105,000 shares of Common Stock
(each such share, a “Warrant Share” and all such shares, the “Warrant Shares”), at any time and from time to time from and after the Original Issue Date and through and including September
    , 2012 (the “Expiration Date”), and subject to the following terms and conditions: 
 1.
Definitions. As used in this Warrant, the following terms shall have the respective definitions set forth in this Section 1. 
 “Affiliate” means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 144.

 “Business Day” means any day except Saturday, Sunday and any day which is a federal legal holiday in the United States or
a day on which banking institutions in the State of New York or State of Illinois are authorized or required by law or other governmental action to close. 

 “Common Stock” means the common stock of the Company, no par value per share, and any
securities into which such common stock may hereafter be reclassified. 
 “Exchange Act” means the Securities Exchange Act
of 1934, as amended. 
 “Exercise Price” means $7.18, subject to adjustment in accordance with Section 10. 
 “Fundamental Transaction” means any of the following: (1) the Company effects any merger or consolidation of the Company with or
into another Person, (2) the Company effects any sale of all or substantially all of its assets in one or a series of related transactions, (3) any tender offer or exchange offer (whether by the Company or another Person) is completed
pursuant to which holders of Common Stock are permitted to tender or exchange their shares for other securities, cash or property, or (4) the Company effects any reclassification of the Common Stock or any compulsory share exchange pursuant to
which the Common Stock is effectively converted into or exchanged for other securities, cash or property. 
 “New York
Courts” means the state and federal courts sitting in the City of New York, Borough of Manhattan. 
 “Original Issue
Date” means the Original Issue Date first set forth on the first page of this Warrant. 
 “Person” means an
individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind. 
 “Rule 144” means Rule 144 promulgated by the Securities and Exchange Commission pursuant to the Securities Act, as such Rule may be
amended from time to time, or any similar rule or regulation hereafter adopted by the Securities and Exchange Commission having substantially the same effect as such Rule. 
 “Securities Act” means the Securities Act of 1933, as amended. 
 “Subsidiary” means any “significant subsidiary” as defined in Rule 1-02(w) of the Regulation S-X promulgated by the Securities
and Exchange Commission under the Exchange Act. 
 “Trading Day” means (i) a day on which the Common Stock is
traded on a Trading Market (other than the OTC Bulletin Board), or (ii) if the Common Stock is not listed on a Trading Market (other than the OTC Bulletin Board), a day on which the Common Stock is traded in the over-the-counter market, as
reported by the OTC Bulletin Board, or (iii) if the Common Stock is not quoted on any Trading Market, a day on which the Common Stock is quoted in the over-the-counter market as reported by the Pink Sheets, LLC (or any similar organization or
agency succeeding to its functions of reporting prices); provided, that in the event that the Common Stock is not listed or quoted as set forth in (i), (ii) and (iii) hereof, then Trading Day shall mean a Business Day. 
  

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 “Trading Market” means whichever of the New York Stock Exchange, the American Stock
Exchange, the NASDAQ Global Select Market, the NASDAQ Global Market, the NASDAQ Capital Market or OTC Bulletin Board on which the Common Stock is listed or quoted for trading on the date in question. 
 “Warrant Shares” means the shares of Common Stock issuable upon exercise of this Warrant. 
 2. Registration of Warrant. The Company shall register this Warrant upon records to be maintained by the Company for that purpose (the
“Warrant Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any
distribution to the Holder, and for all other purposes, absent actual notice to the contrary. 
 3. Registration of Transfers. The
Company shall register the transfer of any portion of this Warrant in the Warrant Register, upon surrender of this Warrant, with the Form of Assignment attached hereto duly completed and signed, to the Company at its address specified herein. Upon
any such registration or transfer, a new Warrant to purchase Common Stock, in substantially the form of this Warrant (any such new Warrant, a “New Warrant”), evidencing the portion of this Warrant so transferred shall be issued to
the transferee and a New Warrant evidencing the remaining portion of this Warrant not so transferred, if any, shall be issued to the transferring Holder. The acceptance of the New Warrant by the transferee thereof shall be deemed the acceptance by
such transferee of all of the rights and obligations of a holder of a Warrant. 
 4. Transfer Restrictions. If, at the time of the
surrender of this Warrant in connection with any transfer of this Warrant, the transfer of this Warrant shall not be registered pursuant to an effective registration statement under the Securities Act and under applicable state securities or blue
sky laws, the Company may require, as a condition of allowing such transfer (i) that the Holder or transferee of this Warrant, as the case may be, furnish to the Company a written opinion of counsel (which opinion shall be in form, substance
and scope customary for opinions of counsel in comparable transactions) to the effect that such transfer may be made without registration under the Securities Act and under applicable state securities or blue sky laws, (ii) that the Holder or
transferee of this Warrant, as the case may be, execute and deliver to the Company an investment letter in the form attached hereto and (iii) that the transferee be an “accredited investor” as defined in Rule 501(a) promulgated under
the Securities Act or a “qualified institutional buyer” as defined in Rule 144A(a) under the Securities Act. 
 5. Exercise and
Duration of Warrants. This Warrant shall be exercisable by the registered Holder at any time and from time to time on or after the Original Issue Date through and including the Expiration Date. At 6:30 p.m., New York City time on the Expiration
Date, the portion of this Warrant not exercised prior thereto shall be and become void and of no value. The Company may not call or redeem any portion of this Warrant without the prior written consent of the affected Holder. 
  

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 6. Delivery of Warrant Shares. 
 (a) To effect exercises hereunder, the Holder shall not be required to physically surrender this Warrant unless the aggregate Warrant Shares represented
by this Warrant is being exercised. Upon delivery of the Exercise Notice (in the form attached hereto) to the Company (with the attached Warrant Shares Exercise Log) at its address for notice set forth herein and upon payment of the Exercise Price
multiplied by the number of Warrant Shares that the Holder intends to purchase hereunder, the Company shall promptly (but in no event later than three Trading Days after the Date of Exercise (as defined herein)) issue and deliver to the Holder, a
certificate for the Warrant Shares issuable upon such exercise. The Company shall, upon request of the Holder and subsequent to the date on which a registration statement covering the resale of the Warrant Shares has been declared effective by the
Securities and Exchange Commission, use its reasonable best efforts to deliver Warrant Shares hereunder electronically through the Depository Trust Corporation or another established clearing corporation performing similar functions, if available,
provided, that, the Company may, but will not be required to change its transfer agent if its current transfer agent cannot deliver Warrant Shares electronically through the Depository Trust Corporation. A “Date of Exercise”
means the date on which the Holder shall have delivered to the Company: (i) the Exercise Notice (with the Warrant Exercise Log attached to it), appropriately completed and duly signed and (ii) if such Holder is not utilizing the cashless
exercise provisions set forth in this Warrant, payment of the Exercise Price for the number of Warrant Shares so indicated by the Holder to be purchased. 
 (b) If by the third Trading Day after a Date of Exercise the Company fails to deliver the required number of Warrant Shares in the manner required pursuant to Section 6(a), then the Holder will have the right to
rescind such exercise. 
 (c) If by the third Trading Day after a Date of Exercise the Company fails to deliver the required number of
Warrant Shares in the manner required pursuant to Section 6(a), and if after such third Trading Day and prior to the receipt of such Warrant Shares, the Holder purchases (in an open market transaction or otherwise) shares of Common Stock to
deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”), then the Company shall (1) pay in cash to the Holder the amount by which (x) the
Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (A) the number of Warrant Shares that the Company was required to
deliver to the Holder in connection with the exercise at issue by (B) the closing bid price of the Common Stock on the Date of Exercise and (2) at the option of the Holder, either reinstate the portion of the Warrant and equivalent number
of Warrant Shares for which such exercise was not honored or deliver to the Holder the number of shares of Common Stock that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. The Holder
shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In. 
 (d) The Company’s
obligations to issue and deliver Warrant Shares in accordance with the terms hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce the same, any waiver or consent with respect to any provision hereof,
the recovery of any judgment against any Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder or any other Person of any obligation to the Company
or any violation or alleged violation of law by the Holder or any other Person, and irrespective of any other circumstance 

  

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which might otherwise limit such obligation of the Company to the Holder in connection with the issuance of Warrant Shares. Nothing herein shall limit a
Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver
certificates representing Warrant Shares upon exercise of the Warrant as required pursuant to the terms hereof. 
 (e) The Holder
acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, will have restrictions upon resale imposed by state and federal securities laws. 
 7. Charges, Taxes and Expenses. Issuance and delivery of Warrant Shares upon exercise of this Warrant shall be made without charge to the Holder
for any issue or transfer tax, withholding tax, transfer agent fee or other incidental tax or expense in respect of the issuance of such certificates, all of which taxes and expenses shall be paid by the Company; provided, however, that the Company
shall not be required to pay any tax which may be payable in respect of any transfer involved in the registration of any certificates for Warrant Shares or Warrants in a name other than that of the Holder. The Holder shall be responsible for all
other tax liability that may arise as a result of holding or transferring this Warrant or receiving Warrant Shares upon exercise hereof. 
 8. Replacement of Warrant. If this Warrant is mutilated, lost, stolen or destroyed, the Company shall issue or cause to be issued in exchange and substitution for and upon cancellation hereof, or in lieu of and substitution for this
Warrant, a New Warrant, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction and customary and reasonable indemnity (which shall not include a surety bond), if requested. Applicants for a New
Warrant under such circumstances shall also comply with such other reasonable regulations and procedures and pay such other reasonable third-party costs as the Company may prescribe. If a New Warrant is requested as a result of a mutilation of this
Warrant, then the Holder shall deliver such mutilated Warrant to the Company as a condition precedent to the Company’s obligation to issue the New Warrant. 
 9. Reservation of Warrant Shares. The Company covenants that it will at all times reserve and keep available out of the aggregate of its authorized but unissued and otherwise unreserved Common Stock, solely for
the purpose of enabling it to issue Warrant Shares upon exercise of this Warrant as herein provided, the number of Warrant Shares which are then issuable and deliverable upon the exercise of this entire Warrant, free from preemptive rights or any
other contingent purchase rights of Persons other than the Holder (taking into account the adjustments and restrictions of Section 10). The Company covenants that all Warrant Shares so issuable and deliverable shall, upon issuance and the
payment of the applicable Exercise Price in accordance with the terms hereof, be duly and validly authorized, issued and fully paid and nonassessable. 
 10. Certain Adjustments. The Exercise Price and number of Warrant Shares issuable upon exercise of this Warrant are subject to adjustment from time to time as set forth in this Section 10. 
  

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 (a) Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding,
(i) pays a stock dividend on its Common Stock or otherwise makes a distribution on any class of capital stock that is payable in shares of Common Stock, (ii) subdivides outstanding shares of Common Stock into a larger number of shares, or
(iii) combines outstanding shares of Common Stock into a smaller number of shares, then in each such case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock outstanding
immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event. Any adjustment made pursuant to clause (i) of this paragraph shall become effective immediately
after the record date for the determination of stockholders entitled to receive such dividend or distribution, and any adjustment pursuant to clause (ii) or (iii) of this paragraph shall become effective immediately after the effective
date of such subdivision or combination. 
 (b) Fundamental Transactions. If, at any time while this Warrant is outstanding there is a
Fundamental Transaction, then the Holder shall have the right thereafter to receive, upon exercise of this Warrant, the same amount and kind of securities, cash or property as it would have been entitled to receive upon the occurrence of such
Fundamental Transaction if it had been, immediately prior to such Fundamental Transaction, the holder of the number of Warrant Shares then issuable upon exercise in full of this Warrant (the “Alternate Consideration”). For purposes
of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such
Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Common Stock
are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such
Fundamental Transaction. At the Holder’s option and request, any successor to the Company or surviving entity in such Fundamental Transaction shall issue to the Holder a new warrant substantially in the form of this Warrant and consistent with
the foregoing provisions and evidencing the Holder’s right to purchase the Alternate Consideration for the aggregate Exercise Price upon exercise thereof. The terms of any agreement pursuant to which a Fundamental Transaction is effected shall
include terms requiring any such successor or surviving entity to comply with the provisions of this paragraph (b) and insuring that the Warrant (or any such replacement security) will be similarly adjusted upon any subsequent transaction
analogous to a Fundamental Transaction. 
 (c) Number of Warrant Shares. Simultaneously with any adjustment to the Exercise Price
pursuant to this Section 10 the number of Warrant Shares that may be purchased upon exercise of this Warrant shall be increased or decreased proportionately, so that after such adjustment the aggregate Exercise Price payable hereunder for the
adjusted number of Warrant Shares shall be the same as the aggregate Exercise Price in effect immediately prior to such adjustment. 
 (d) Calculations. All calculations under this Section 10 shall be made to the nearest
cent or the nearest 1/100th of a share, as applicable. The number of shares of Common Stock outstanding at any given time shall not include shares owned or
held by or for the account of the Company, and the disposition of any such shares shall be considered an issue or sale of Common Stock. 
  

 -6- 

 (e) Notice of Adjustments. Upon the occurrence of each adjustment pursuant to this
Section 10, the Company at its expense will promptly compute such adjustment in accordance with the terms of this Warrant and prepare a certificate setting forth such adjustment, including a statement of the adjusted Exercise Price and adjusted
number or type of Warrant Shares or other securities issuable upon exercise of this Warrant (as applicable), describing the transactions giving rise to such adjustments and showing in detail the facts upon which such adjustment is based. Upon
written request, the Company will promptly deliver a copy of each such certificate to the Holder and to the Company’s Transfer Agent. 
 (f) Notice of Corporate Events. If the Company (i) declares a dividend or any other distribution of cash, securities or other property in respect of its Common Stock, including without limitation any granting of rights or
warrants to subscribe for or purchase any capital stock of the Company or any Subsidiary, (ii) authorizes or approves, enters into any agreement contemplating or solicits stockholder approval for any Fundamental Transaction or
(iii) authorizes the voluntary dissolution, liquidation or winding up of the affairs of the Company, then the Company shall deliver to the Holder a notice describing the material terms and conditions of such transaction (but only to the extent
such disclosure would not result in the dissemination of material, non-public information to the Holder) at least 10 calendar days prior to the applicable record or effective date on which a Person would need to hold Common Stock in order to
participate in or vote with respect to such transaction, and the Company will take all steps reasonably necessary in order to insure that the Holder is given the practical opportunity to exercise this Warrant prior to such time so as to participate
in or vote with respect to such transaction; provided, however, that the failure to deliver such notice or any defect therein shall not affect the validity of the corporate action required to be described in such notice. 
 11. Payment of Exercise Price. The Holder may pay the Exercise Price in one of the following manners: 
 (a) Cash Exercise. The Holder may deliver immediately available funds; or 
 (b) Cashless Exercise. The Holder may notify the Company in an Exercise Notice of its election to utilize cashless exercise, in which event the
Company shall issue to the Holder the number of Warrant Shares determined as follows: 
 X = Y [(A-B)/A] 
 where: 
 X = the number of Warrant Shares to
be issued to the Holder. 
 Y = the number of Warrant Shares with respect to which this Warrant is being exercised. 
 A = the average of the closing prices for the five Trading Days immediately prior to (but not including) the Date of Exercise. 
 B = the Exercise Price. 
  

 -7- 

 For purposes of Rule 144 promulgated under the Securities Act, it is intended, understood and acknowledged that the
Warrant Shares issued in a cashless exercise transaction shall be deemed to have been acquired by the Holder, and the holding period for the Warrant Shares shall be deemed to have commenced, on the date this Warrant was originally issued.

 12. Limitations on Exercise. Notwithstanding anything to the contrary contained herein, the number of Warrant Shares that may be
acquired by the Holder upon any exercise of this Warrant (or otherwise in respect hereof) shall be limited to the extent necessary to insure that, following such exercise (or other issuance), the total number of shares of Common Stock then
beneficially owned by such Holder and its Affiliates and any other Persons whose beneficial ownership of Common Stock would be aggregated with the Holder’s for purposes of Section 13(d) of the Exchange Act, does not exceed 9.99% of the
total number of issued and outstanding shares of Common Stock (including for such purpose the shares of Common Stock issuable upon such exercise). For such purposes, beneficial ownership shall be determined in accordance with Section 13(d) of
the Exchange Act and the rules and regulations promulgated thereunder. This provision shall not restrict the number of shares of Common Stock which a Holder may receive or beneficially own in order to determine the amount of securities or other
consideration that such Holder may receive in the event of a Fundamental Transaction as contemplated in Section 10 of this Warrant. This restriction may not be waived. Notwithstanding anything to the contrary contained in this Warrant,
(a) no term of this Section may be waived by any party, nor amended such that the threshold percentage of ownership would be directly or indirectly increased, (b) this restriction runs with the Warrant and may not be modified or waived by
any subsequent holder hereof and (c) any attempted waiver, modification or amendment of this Section will be void ab initio. 
 13. No Fractional Shares. No fractional shares of Warrant Shares will be issued in connection with any exercise of this Warrant. In lieu of any fractional shares which would, otherwise be issuable, the Company
shall pay cash equal to the product of such fraction multiplied by the closing price of one Warrant Share as reported by the applicable Trading Market on the date of exercise. 
 14. Notices. Any and all notices or other communications or deliveries hereunder
(including, without limitation, any Exercise Notice) shall be in writing and shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number
specified in this Section prior to 6:30 p.m. (New York City time) on a Trading Day, (ii) the next Trading Day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number specified in this
Section on a day that is not a Trading Day or later than 6:30 p.m. (New York City time) on any Trading Day, (iii) the Trading Day following the date of mailing, if sent by nationally recognized overnight courier service, or (iv) upon
actual receipt by the party to whom such notice is required to be given. The addresses for such communications shall be: (i) if to the Company, to 7402 W. 100th Place, Bridgeview, Illinois 60455, Attn: President, or to facsimile no.: (248) 560-2000 (or such other address as the Company shall indicate in writing in accordance with this Section), or (ii) if to the Holder, to the address or
facsimile number appearing on the Warrant Register or such other address or facsimile number as the Holder may provide to the Company in accordance with this Section. 
  

 -8- 

 15. Warrant Agent. The Company shall serve as warrant agent under this Warrant. Upon 10 days’
notice to the Holder, the Company may appoint a new warrant agent. Any corporation into which the Company or any new warrant agent may be merged or any corporation resulting from any consolidation to which the Company or any new warrant agent shall
be a party or any corporation to which the Company or any new warrant agent transfers substantially all of its corporate trust or shareholders services business shall be a successor warrant agent under this Warrant without any further act. Any such
successor warrant agent shall promptly cause notice of its succession as warrant agent to be mailed (by first class mail, postage prepaid) to the Holder at the Holder’s last address as shown on the Warrant Register. 
 16. Miscellaneous. 
 (a) This Warrant
shall be binding on and inure to the benefit of the parties hereto and their respective successors and assigns. Subject to the preceding sentence, nothing in this Warrant shall be construed to give to any Person other than the Company and the Holder
any legal or equitable right, remedy or cause of action under this Warrant. This Warrant may be amended only in writing signed by the Company and the Holder and their successors and assigns. The foregoing sentence shall be subject to the
restrictions on waivers and amendments set forth in Section 12 of this Warrant. 
 (b) All questions concerning the construction,
validity, enforcement and interpretation of this Warrant shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Each party agrees
that all legal proceedings concerning the interpretations, enforcement and defense of this Warrant and the transactions herein contemplated (“Proceedings”) (whether brought against a party hereto or its respective Affiliates,
employees or agents) shall be commenced exclusively in the New York Courts. Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the New York Courts for the adjudication of any dispute hereunder or in connection herewith or
with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any Proceeding, any claim that it is not personally subject to the jurisdiction of any New York Court, or that such Proceeding
has been commenced in an improper or inconvenient forum. Each party hereto hereby irrevocably waives personal service of process and consents to process being served in any such Proceeding by mailing a copy thereof via registered or certified mail
or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Warrant and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained
herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Each party hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal
proceeding arising out of or relating to this Warrant or the transactions contemplated hereby. If either party shall commence a Proceeding to enforce any provisions of this Warrant, then the prevailing party in such Proceeding shall be reimbursed by
the other party for its attorney’s fees and other costs and expenses incurred with the investigation, preparation and prosecution of such Proceeding. 
  

 -9- 

 (c) The headings herein are for convenience only, do not constitute a part of this Warrant and shall not
be deemed to limit or affect any of the provisions hereof. 
 (d) In case any one or more of the provisions of this Warrant shall be invalid
or unenforceable in any respect, the validity and enforceability of the remaining terms and provisions of this Warrant shall not in any way be affected or impaired thereby and the parties will attempt in good faith to agree upon a valid and
enforceable provision which shall be a commercially reasonable substitute therefor, and upon so agreeing, shall incorporate such substitute provision in this Warrant. 
 (e) Prior to exercise of this Warrant, the Holder hereof shall not, by reason of being a Holder, be entitled to any rights of a stockholder with respect to the Warrant Shares. 
 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK, 
 SIGNATURE PAGE FOLLOWS] 
  

 -10- 

 IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by its authorized officer as
of the date first indicated above. 
  

			
	 VERI-TEK INTERNATIONAL, CORP.

		
	By:	 	  

	Name:	 	
	Title:	 	

  

 -11- 

 EXERCISE NOTICE 
 VERI-TEK INTERNATIONAL, CORP. 
 WARRANT DATED SEPTEMBER     , 2007 
 The undersigned Holder hereby irrevocably elects to purchase
                                 shares of Common Stock pursuant to the above
referenced Warrant. Capitalized terms used herein and not otherwise defined have the respective meanings set forth in the Warrant. 
  

	(1)	The undersigned Holder hereby exercises its right to purchase
                                 Warrant Shares pursuant to the Warrant.

  

	(2)	The Holder intends that payment of the Exercise Price shall be made as (check one): 

  

			
	              
	  	“Cash Exercise” under Section 11
		
	              
	  	“Cashless Exercise” under Section 11

  

	(3)	If the holder has elected a Cash Exercise, the holder shall pay the sum of $             to the Company in
accordance with the terms of the Warrant. 

  

	(4)	Pursuant to this Exercise Notice, the Company shall deliver to the holder
                    Warrant Shares in accordance with the terms of the Warrant. 

  

	(5)	By its delivery of this Exercise Notice, the undersigned represents and warrants to the Company that in giving effect to the exercise evidenced hereby the Holder will not
beneficially own in excess of the number of shares of Common Stock (determined in accordance with Section 13(d) of the Securities Exchange Act of 1934) permitted to be owned under Section 12 of this Warrant to which this notice relates.

  

							
	Dated:                      ,        
	 		  	Name of Holder:
				
		 		  	(Print)	  	  

				
		 		  	By:	  	  

		 		  	Name:	  	  

		 		  	Title:	  	  

			
		 		  	(Signature must conform in all respects to name of holder as specified on the face of the Warrant)

  

 -12- 

 Warrant Shares Exercise Log 
  

							
	 Date
	 	 Number of Warrant Shares
Available to be Exercised
	 	 Number of Warrant Shares Exercised
	 	 Number of Warrant Shares
Remaining to be
Exercised

		 		 		 	

  

 -13- 

 VERI-TEK INTERNATIONAL, CORP. 
 WARRANT DATED SEPTEMBER     , 2007 
 WARRANT NO. [ ] 
 FORM OF ASSIGNMENT 
 [To be completed and
signed only upon transfer of Warrant] 
 FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
                                        
             the right represented by the above-captioned Warrant to purchase
                             shares of Common Stock to which such Warrant relates and appoints
                             attorney to transfer said right on the books of the Company with full
power of substitution in the premises. 
 Dated:
                    ,          
  

	
	  

	(Signature must conform in all respects to name of holder as specified on the face of the Warrant)
	
	  

	Address of Transferee
	
	  

	  

 In the presence of: 
  

	
	  
 

  

 -14- 

 VERI-TEK INTERNATIONAL, CORP. 
 WARRANT ORIGINALLY ISSUED SEPTEMBER     , 2007 
 WARRANT NO. [ ] 
 FORM OF INVESTMENT LETTER 
  

 -15-

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