Document:

Amended and Restated Credit Agreement

 EXHIBIT 10.45 
  
 EXECUTED VERSION 
 CUSIP NUMBER: 04313KAD1 
  
 Confidential treatment has been requested for portions of this exhibit. The copy filed herewith omits the information subject to the confidentiality request. Omissions
are designated as [*]. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. 
  

 AMENDED AND RESTATED CREDIT AGREEMENT

  
 dated as of October 15, 2004 
  
 among 
  
 ARTHROCARE CORPORATION, 
 as the Borrower, 
  
 BANK OF AMERICA, N.A., 
 as
Administrative Agent and as a Lender, 
  
 WELLS
FARGO BANK, NATIONAL ASSOCIATION, 
 as Documentation Agent, as Collateral
Agent and as a Lender, 
  
 and 
  
 THE OTHER LENDERS
PARTY HERETO 
  
 BANC OF AMERICA SECURITIES LLC, 
 AND

 WELLS FARGO BANK, NATIONAL ASSOCIATION 
 as 
 Co-Lead Arrangers 
  

 TABLE OF CONTENTS 
  

									
	 Section

	  	Page

	ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS	  	1
				
	 	  	1.01	 	DEFINED TERMS.	  	1
				
	 	  	1.02	 	OTHER INTERPRETIVE PROVISIONS.	  	16
				
	 	  	1.03	 	ACCOUNTING TERMS; ROUNDING.	  	17
				
	 	  	1.04	 	REFERENCES TO AGREEMENTS AND LAWS.	  	17
		
	ARTICLE II. THE COMMITMENTS AND THE LOANS	  	18
				
	 	  	2.01	 	LOANS.	  	18
				
	 	  	2.02	 	BORROWINGS, CONVERSIONS AND CONTINUATIONS OF LOANS.	  	18
				
	 	  	2.03	 	PREPAYMENTS.	  	19
				
	 	  	2.04	 	REDUCTION OR TERMINATION OF COMMITMENTS.	  	20
				
	 	  	2.05	 	REPAYMENT OF LOANS.	  	20
				
	 	  	2.06	 	INTEREST.	  	21
				
	 	  	2.07	 	FEES.	  	21
				
	 	  	2.08	 	COMPUTATION OF INTEREST AND FEES.	  	21
				
	 	  	2.09	 	EVIDENCE OF DEBT.	  	22
				
	 	  	2.10	 	PAYMENTS GENERALLY.	  	22
				
	 	  	2.11	 	SHARING OF PAYMENTS.	  	23
				
	 	  	2.12	 	GUARANTY OF OBLIGATIONS.	  	24
		
	ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY	  	24
				
	 	  	3.01	 	TAXES.	  	24
				
	 	  	3.02	 	ILLEGALITY.	  	25
				
	 	  	3.03	 	INABILITY TO DETERMINE RATES.	  	26
				
	 	  	3.04	 	INCREASED COST AND REDUCED RETURN; CAPITAL ADEQUACY;
RESERVES ON EURODOLLAR RATE LOANS.	  	26
				
	 	  	3.05	 	FUNDING LOSSES.	  	27
				
	 	  	3.06	 	MATTERS APPLICABLE TO ALL REQUESTS FOR COMPENSATION.	  	27
				
	 	  	3.07	 	SURVIVAL.	  	27
		
	ARTICLE IV. CONDITIONS	  	27
				
	 	  	4.01	 	CONDITIONS TO EFFECTIVENESS AND INITIAL LOANS.	  	27
				
	 	  	4.02	 	CONDITIONS TO ALL BORROWINGS AND CONVERSIONS AND
CONTINUATIONS.	  	28
		
	ARTICLE V. REPRESENTATIONS AND WARRANTIES	  	30
				
	 	  	5.01	 	EXISTENCE, QUALIFICATION AND POWER; COMPLIANCE WITH LAWS.	  	30
				
	 	  	5.02	 	AUTHORIZATION; NO CONTRAVENTION.	  	30
				
	 	  	5.03	 	GOVERNMENTAL AUTHORIZATION.	  	30
				
	 	  	5.04	 	BINDING EFFECT.	  	30
				
	 	  	5.05	 	FINANCIAL STATEMENTS; NO MATERIAL ADVERSE EFFECT.	  	30
				
	 	  	5.06	 	LITIGATION.	  	31
				
	 	  	5.07	 	NO DEFAULT.	  	31
				
	 	  	5.08	 	OWNERSHIP OF PROPERTY; LIENS.	  	31
				
	 	  	5.09	 	ENVIRONMENTAL COMPLIANCE.	  	31
				
	 	  	5.10	 	INSURANCE.	  	32
				
	 	  	5.11	 	TAXES.	  	32
				
	 	  	5.12	 	ERISA COMPLIANCE.	  	32
				
	 	  	5.13	 	SUBSIDIARIES.	  	33
				
	 	  	5.14	 	MARGIN REGULATIONS; INVESTMENT COMPANY ACT; PUBLIC UTILITY
HOLDING COMPANY ACT.	  	33
				
	 	  	5.15	 	DISCLOSURE.	  	33
				
	 	  	5.16	 	INTELLECTUAL PROPERTY; LICENSES, ETC.	  	33
				
	 	  	5.17	 	SWAP CONTRACTS.	  	34
				
	 	  	5.18	 	LABOR RELATIONS.	  	34

  

 i 

									
				
	 	  	5.19	  	USE OF PROCEEDS.	  	34
				
	 	  	5.20	  	SOLVENCY.	  	34
				
	 	  	5.21	  	TAX SHELTER REGULATIONS.	  	34
		
	 ARTICLE VI. AFFIRMATIVE COVENANTS
	  	34
					
	 	  	[*]	  	 	  	 	  	 
		
	 ARTICLE VII. NEGATIVE COVENANTS
	  	35
					
	 	  	[*]	  	 	  	 	  	 
		
	 ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES
	  	35
				
	 	  	8.01	  	EVENTS OF DEFAULT.	  	35
				
	 	  	8.02	  	REMEDIES UPON EVENT OF DEFAULT.	  	37
				
	 	  	8.03	  	APPLICATION OF FUNDS.	  	37
		
	 ARTICLE IX. ADMINISTRATIVE AGENT AND COLLATERAL AGENT
	  	38
				
	 	  	9.01	  	APPOINTMENT AND AUTHORIZATION OF ADMINISTRATIVE AGENT AND
COLLATERAL AGENT.	  	38
				
	 	  	9.02	  	DELEGATION OF DUTIES.	  	38
				
	 	  	9.03	  	LIABILITY OF ADMINISTRATIVE AGENT.	  	38
				
	 	  	9.04	  	RELIANCE BY ADMINISTRATIVE AGENT AND COLLATERAL AGENT.	  	39
				
	 	  	9.05	  	NOTICE OF DEFAULT.	  	39
				
	 	  	9.06	  	CREDIT DECISION; DISCLOSURE OF INFORMATION BY AGENT-RELATED
PERSONS.	  	40
				
	 	  	9.07	  	INDEMNIFICATION OF AGENT-RELATED PERSONS.	  	40
				
	 	  	9.08	  	ADMINISTRATIVE AGENT AND COLLATERAL AGENT IN THEIR
INDIVIDUAL CAPACITIES.	  	41
				
	 	  	9.09	  	SUCCESSOR ADMINISTRATIVE AGENT.	  	41
				
	 	  	9.10	  	SUCCESSOR COLLATERAL AGENT.	  	41
				
	 	  	9.11	  	ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM.	  	42
				
	 	  	9.12	  	GUARANTY MATTERS.	  	42
				
	 	  	9.13	  	COLLATERAL MATTERS.	  	43
				
	 	  	9.14	  	OTHER AGENTS; ARRANGERS AND MANAGERS.	  	44

  

	[*]	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the
omitted portions. 

  

 ii 

									
	 ARTICLE X. GENERAL PROVISIONS
	  	44
				
	 	  	10.01	 	AMENDMENTS, ETC.	  	44
				
	 	  	10.02	 	NOTICES AND OTHER COMMUNICATIONS; FACSIMILE COPIES.	  	45
				
	 	  	10.03	 	NO WAIVER; CUMULATIVE REMEDIES.	  	46
				
	 	  	10.04	 	ATTORNEY COSTS, EXPENSES AND TAXES.	  	46
				
	 	  	10.05	 	INDEMNIFICATION BY THE BORROWER.	  	47
				
	 	  	10.06	 	PAYMENTS SET ASIDE.	  	47
				
	 	  	10.07	 	SUCCESSORS AND ASSIGNS.	  	48
				
	 	  	10.08	 	CONFIDENTIALITY.	  	50
				
	 	  	10.09	 	SET-OFF.	  	51
				
	 	  	10.10	 	INTEREST RATE LIMITATION.	  	51
				
	 	  	10.11	 	COUNTERPARTS.	  	51
				
	 	  	10.12	 	INTEGRATION; AMENDMENT AND RESTATEMENT.	  	51
				
	 	  	10.13	 	SURVIVAL OF REPRESENTATIONS AND WARRANTIES.	  	52
				
	 	  	10.14	 	SEVERABILITY.	  	52
				
	 	  	10.15	 	FOREIGN LENDERS.	  	52
				
	 	  	10.16	 	GOVERNING LAW.	  	53
				
	 	  	10.17	 	WAIVER OF RIGHT TO TRIAL BY JURY.	  	53
				
	 	  	10.18	 	PATRIOT ACT NOTICE.	  	53
				
	 	  	10.19	 	TIME OF THE ESSENCE.	  	54

  

 iii 

 SCHEDULES 
  

			
	A	 	Guarantors
	2.01	 	Commitments and Pro Rata Shares
	5.06	 	Litigation
	5.09	 	Environmental Matters
	5.13	 	Subsidiaries and Other Equity Investments
	5.16	 	Intellectual Property Matters
	7.01	 	Existing Liens
	7.02(a)	 	Existing Investments
	7.02(b)	 	Investment Guidelines
	7.03	 	Existing Indebtedness
	7.06	 	Existing Leases
	10.02	 	Eurodollar and Domestic Lending Offices; Addresses for Notices

  
 EXHIBITS 
  

			
	Exhibit A	 	Form of Loan Notice
	Exhibit B	 	Form of Revolving Line of Credit Note
	Exhibit C	 	Form of Compliance Certificate
	Exhibit D	 	Form of Assignment and Assumption Agreement
	Exhibit E	 	Form of Guaranty
	Exhibit F	 	Form of Term Commitment Note
	Exhibit G	 	Form of Security Agreement
	Exhibit H	 	Form of Trademark Security Agreement

  

 iv 

 AMENDED AND RESTATED CREDIT AGREEMENT 
  
 This AMENDED AND RESTATED CREDIT AGREEMENT, dated
as of October 15, 2004, is among ARTHROCARE CORPORATION, a Delaware corporation (the “Borrower”), each lender from time to time party hereto (collectively, the “Lenders”
and, individually, a “Lender”), BANK OF AMERICA, N.A., as Administrative Agent, and WELLS FARGO BANK, NATIONAL
ASSOCIATION, as Documentation Agent and as Collateral Agent. 
  
 RECITALS 
  
 WHEREAS the Borrower, the Lenders, Administrative Agent, Documentation Agent and Collateral Agent have previously entered into the Existing Credit Agreement; and 
  
 WHEREAS the Borrower has requested that the Lenders amend the Existing Credit Agreement, and the Lenders are
willing to amend the Existing Credit Agreement, on the terms and conditions contained herein; 
  
 NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, and intending to be legally bound hereby, the parties hereto covenant and agree as follows:

  
 ARTICLE I. 
 DEFINITIONS AND ACCOUNTING TERMS 
  
 1.01 Defined Terms. 
  
 As used in this Agreement, the following terms shall have the meanings set
forth below: 
  
 “Acquisition” means any
transaction or series of related transactions for the purpose of or resulting in, directly or indirectly: (a) the acquisition of all or substantially all of the Property of a Person, or of any business or division of a Person; (b) the acquisition of
in excess of fifty percent (50.0%) of the capital stock, partnership interests, membership interests or equity of any Person, or otherwise causing any Person to become a Subsidiary; (c) the power to elect, appoint, or cause the election or
appointment of at least a majority of the members of the board of directors or similar governing body of such Person; or (d) a merger or consolidation or any other combination with another Person (other than a Person that is a Subsidiary),
provided that the Borrower or one of its Subsidiaries is the surviving entity. 
  
 “Administrative Agent” means the sole administrative agent for the Lenders under the Loan Documents or any successor administrative agent, in each case as appointed under Article X, which,
initially, shall be Bank of America. 
  
 “Administrative
Agent’s Office” means the Administrative Agent’s address and, as appropriate, account as set forth on Schedule 10.02, or such other address or account as the Administrative Agent may from time to time notify to the Borrower
and the Lenders. 
  
 “Affiliate” means, as to any
Person, any other Person directly or indirectly controlling, controlled by, or under direct or indirect common control with, such Person. A Person shall be deemed to be “controlled by” any other Person if such other Person possesses,
directly or indirectly, power (a) to vote five percent (5.0%) or more of the securities having ordinary voting power for the election of directors or managing general partners; or (b) to direct or cause the direction of the management and policies
of such Person whether by voting securities, through the ownership of contract or otherwise. 
  

 1 

 “Agent-Related Persons” means the Administrative Agent (including any successor
administrative agent), the Documentation Agent, and the Collateral Agent, together with their respective Affiliates (including, in the case of Bank of America in its capacity as the Administrative Agent, Banc of America Securities, LLC as an
Arranger), and the officers, directors, employees, agents and attorneys-in-fact of such Persons and Affiliates. 
  
 “Aggregate Commitments” means, as of any date of determination, the aggregate amount of all Lenders’ Commitments hereunder.

  
 “Agreement” means this Credit Agreement.

  
 “Alpha Merger Sub” means Alpha Merger Sub
Corporation, a Nevada corporation and a wholly owned Subsidiary of the Borrower. 
  
 “Applicable Rate” means [*] 
  
 “Approved Fund” has the meaning set forth in Section 10.07(g). 
  
 “Arrangers” means the Persons acting as co-lead arrangers, which, initially, shall be Banc of America Securities LLC and Wells
Fargo. 
  
 “Assignment and Assumption Agreement”
means an Assignment and Assumption Agreement substantially in the form of Exhibit D. 
  
 “Attorney Costs” means and includes all fees and disbursements of any law firm or other external counsel and the allocated cost of internal legal services and all disbursements of internal counsel.

  
 “Attributable Indebtedness” means, on any
date, (a) in respect of any capital lease of any Person, the capitalized amount thereof that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP, and (b) in respect of any Synthetic Lease Obligation, the
capitalized amount of the remaining lease payments under the relevant lease that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP if such lease were accounted for as a capital lease. 
  
 “Audited Financial Statements” means the audited
consolidated balance sheet of the Borrower and its Subsidiaries for the fiscal year ended December 31, 2003, and the related consolidated statements of income or operations, shareholders’ equity and cash flows for such fiscal year of the
Borrower and its Subsidiaries. 
  
 “Bank of
America” means Bank of America, N.A. 
  
 “Bankruptcy Code” means the federal Bankruptcy Reform Act of 1978 (11 U.S.C. §101 et seq.). 
  
 [*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions. 
  
 “Base Rate” means for any day a fluctuating rate per annum equal to the higher of (a) the Federal Funds Rate plus one-half of one percent (0.50%) and (b) the rate of interest in effect for such day as 
  

 2 

 publicly announced from time to time by Bank of America as its “prime rate.” Bank of America’s “prime
rate” is a rate set by Bank of America based upon various factors including Bank of America’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be
priced at, above, or below such announced rate. Any change in such rate announced by Bank of America shall take effect at the opening of business on the day specified in the public announcement of such change. 
  
 “Base Rate Loan” means a Loan that bears interest based on
the Base Rate. 
  
 “Borrower” has the meaning set
forth in the introductory paragraph hereto. 
  
 “Borrowing” means a borrowing consisting of simultaneous Loans of the same Type and having the same Interest Period made by each of the Lenders pursuant to Section 2.01(a) or Section 2.01(b). 
  
 “Business Day” means any day other than a Saturday, Sunday,
or other day on which commercial banks are authorized to close under the Laws of, or are in fact closed in, the state where the Administrative Agent’s Office is located and, if such day relates to any Eurodollar Rate Loan, means any such day on
which dealings in Dollar deposits are conducted by and between banks in the London interbank eurodollar market. 
  
 “Calculation Date” has the meaning set forth in the definition of “Applicable Rate” contained herein. 
  
 “Capital Expenditures” means for any period and with respect
to any Person, the aggregate of all expenditures by such Person and its Subsidiaries for the acquisition or leasing of fixed or capital assets or additions to equipment (including replacements, capitalized repairs and improvements during such
period) which should be capitalized under GAAP on a consolidated balance sheet of such Person and its Subsidiaries, minus net proceeds from sales of fixed or capital assets received by such Person or any of its Subsidiaries during such
period. 
  
 “Change of Control” means, with
respect to any Person, an event or series of events by which: 
  
 (a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act, but excluding any employee benefit plan of such person or its subsidiaries, and any person or
entity acting in its capacity as trustee, agent or other fiduciary or administrator of any such plan) becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a person or group shall be deemed
to have “beneficial ownership” of all securities that such person or group has the right to acquire (such right, an “option right”), whether such right is exercisable immediately or only after the passage of time),
directly or indirectly, of twenty-five percent (25.0%) or more of the equity securities of such Person entitled to vote for members of the board of directors or equivalent governing body of such Person on a partially-diluted basis (i.e., taking into
account all such securities that such person or group has the right to acquire pursuant to any option right); or 
  
 (b) during any period of twelve (12) consecutive months, a majority of the members of the board of directors or other equivalent governing
body of such Person cease to be composed of individuals (i) who were members of that board or equivalent governing body on the first day of such period, (ii) whose election or nomination to that board or equivalent governing body was approved by
individuals referred to in clause (i) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body or (iii) whose election or nomination to that board or other equivalent governing body
was approved by individuals referred to in clauses (i) and (ii) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body. 
  

 3 

 “Closing Date” means the first date on which all the conditions precedent in Section
4.01 are satisfied or waived in accordance with Section 4.01 (or, in the case of Section 4.01(b), waived by the Person entitled to receive the applicable payment). 
  
 “Code” means the Internal Revenue Code of 1986. 
  
 “Collateral” means, as of any date of determination, all
property and assets securing the Obligations. 
  
 “Collateral Agent” means the sole collateral agent for the Lenders under the Loan Documents or any successor collateral agent, in each case as appointed under Article X, which, initially, shall be Wells Fargo.

  
 “Commitment” means, as to each Lender as of
any date of determination, its obligation to make Loans to the Borrower pursuant to Section 2.01(a) or Section 2.01(b) in an aggregate principal amount at any one time outstanding not to exceed the amount set forth opposite such
Lender’s name on Schedule 2.01, as such amount may be reduced or adjusted from time to time in accordance with this Agreement. 
  
 “Compensation Period” has the meaning set forth in Section 2.10(d)(ii). 
  
 “Compliance Certificate” means a certificate substantially
in the form of Exhibit C. 
  
 “Consolidated
EBITDA” means, for any period, for the Borrower and its Subsidiaries on a consolidated basis, an amount equal to the sum of (a) the net income of the Borrower and its Subsidiaries from continuing operations after extraordinary items
(excluding gains or losses from Dispositions of assets) for such period plus (b) the amount of taxes, based on or measured by income, used or included in the determination of such net income plus (c) Consolidated Interest Expense for
such period plus (d) the amount of depreciation and amortization expense deducted in determining the net income for such period. 
  
 “Consolidated Funded Indebtedness” means, as of any date of determination, for the Borrower and its Subsidiaries on a consolidated basis,
the sum of (a) the outstanding principal amount of all obligations, whether current or long-term, for borrowed money (including Obligations hereunder) and all obligations evidenced by notes, loan agreements or other similar instruments, bonds,
debentures, letters of credit (including standby and commercial), reimbursement agreements, bankers’ acceptances, bank guaranties, surety bonds and similar instruments (in each case, whether or not such obligations are contingent or absolute),
plus (b) Attributable Indebtedness in respect of capital leases and Synthetic Lease Obligations, plus (c) without duplication, all Guaranty Obligations with respect to Indebtedness of the types specified in subsections (a) and (b)
above of Persons other than the Borrower or any Subsidiary. 
  
 “Consolidated Interest Expense” means, for any period, for the Borrower and its Subsidiaries on a consolidated basis, the sum of (a) all interest, premium payments, fees, charges and related expenses of the Borrower and its
Subsidiaries in connection with borrowed money (including capitalized interest) or in connection with the deferred purchase price of assets, in each case to the extent treated as interest in accordance with GAAP plus (b) the portion of rent
expense of the Borrower and its Subsidiaries with respect to such period under capital leases which is treated as interest in accordance with GAAP. 
  
 “Contractual Obligation” means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument or
other undertaking to which such Person is a party or by which it or any of its property is bound. 
  

 4 

 “Debtor Relief Laws” means the Bankruptcy Code, and all other liquidation,
conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States of America or other applicable jurisdictions from time to
time in effect and affecting the rights of creditors generally. 
  
 “Debt Service Coverage Ratio” means, as of any date of determination, for the Borrower and its Subsidiaries on a consolidated basis, the ratio of (a) the sum of (i) Consolidated EBITDA, measured for the period consisting of
the four consecutive fiscal quarters ending on such date, plus (ii) interest income for such period (to the extent not included in Consolidated EBITDA for such period), minus (iii) all Capital Expenditures actually made during such
period minus (iv) all taxes actually paid in cash during such period to (b) the sum of (i) Consolidated Interest Expense, measured for the period consisting of the four consecutive fiscal quarters ending on such date, which was
deductible in determining consolidated net income for such period plus (ii) the current portion of Consolidated Funded Indebtedness (other than that portion thereof comprised of the Outstanding Amount of Revolving Line of Credit Loans)
plus (iii) for purposes of the fiscal quarter of the Borrower ending December 31, 2005, the cash portion of the Aggregate Second Payment Amount, the Third Payment Amount, the Fourth Payment Amount and the Earnout Amount (as each of those
terms is defined in the Merger Agreement (as that term is defined in the definition of “Specified Acquisition Agreements” contained herein)) as identified by the Borrower to the Administrative Agent pursuant to Section
6.02(e)(i). 
  
 “Default” means any event
that, with the giving of any notice, the passage of time, or both, would be an Event of Default. 
  
 “Default Rate” means a fluctuating interest rate per annum equal to (a) the Base Rate plus (b) the Applicable Rate, if any,
applicable to Base Rate Loans plus (c) two percent (2.0%) per annum. 
  
 “Disposition” or “Dispose” means the sale, transfer, license or other disposition (including any sale and leaseback transaction) of any property by any Person, including any sale,
assignment, transfer or other disposal, with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith. 
  
 “Documentation Agent” means the sole documentation agent for the Lenders under the Loan Documents or any successor documentation agent,
which, initially, shall be Wells Fargo. 
  
 “Dollar” and “$” means lawful money of the United States of America. 
  
 “Eligible Assignee” has the meaning set forth in Section 10.07(g). 
  
 “Environmental Claims” means all claims, however asserted, by any Governmental Authority or any other
Person alleging potential liability or responsibility for violation of any Environmental Law or for release or injury to the environment or threat to public health, personal injury (including sickness, disease or death), property damage, natural
resources damage, or otherwise alleging liability or responsibility for damages (punitive or otherwise), cleanup, removal, remedial or response costs, restitution, civil or criminal penalties, injunctive relief, or other type of relief, resulting
from or based upon (a) the presence, placement, discharge, emission or release (including intentional and unintentional, negligent and non-negligent, sudden or non-sudden, accidental or non-accidental placement, spills, leaks, discharges, emissions
or releases) of any Hazardous Material at, in or from property, whether or not owned by the Borrower or any of its Subsidiaries, or (b) any other circumstances forming the basis of any violation, or alleged violation, of any Environmental Law.

  

 5 

 “Environmental Laws” means any and all federal, state, local, and foreign statutes,
laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or governmental restrictions relating to pollution and the protection of the environment or the release of any materials
into the environment, including those related to hazardous substances or wastes, air emissions and discharges to waste or public systems. 
  
 “ERISA” means the Employee Retirement Income Security Act of 1974 and any regulations issued pursuant thereto. 
  
 “ERISA Affiliate” means any trade or business (whether or
not incorporated) under common control with the Borrower within the meaning of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code). 
  
 “ERISA Event” means any of the following: (a) a Reportable
Event with respect to a Pension Plan; (b) a withdrawal by the Borrower or any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA)
or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is in
reorganization; (d) the filing of a notice of intent to terminate, the treatment of a Plan amendment as a termination under Sections 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer
Plan; (e) an event or condition which might reasonably be expected to constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the imposition
of any liability under Title IV of ERISA, other than PBGC premiums due but not delinquent under Section 4007 of ERISA, upon the Borrower or any ERISA Affiliate. 
  

 6 

 “Eurodollar Rate” means, for any Interest Period with respect to a Eurodollar Rate Loan,
a rate per annum determined by the Administrative Agent pursuant to the following formula: 
  

					
	Eurodollar Rate =	  	1.00 –	 	 Eurodollar Base Rate

	  	 	Eurodollar Reserve Percentage

  
 where:

  
 “Eurodollar Base Rate”
means, for such Interest Period (rounded upwards, as necessary, to the nearest 1/100 of 1%) the rate per annum equal to the British Bankers Association LIBOR Rate (“BBA LIBOR”), as published by Reuters (or other commercially
available source providing quotations of BBA LIBOR as designated by the Administrative Agent from time to time) at approximately 11:00 a.m., London time, two (2) Business Days prior to the commencement of such Interest Period, for Dollar deposits
(for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period. If such rate is not available at such time for any reason, then the “Eurodollar Base Rate” for such Interest Period shall be the
rate per annum determined by the Administrative Agent to be the rate at which deposits in Dollars for delivery on the first day of such Interest Period in same day funds in the approximate amount of the Eurodollar Rate Loan being made, continued or
converted by Bank of America and with a term equivalent to such Interest Period would be offered by Bank of America’s London Branch to major banks in the London interbank eurodollar market at their request at approximately 11:00 a.m. (London
time) two (2) Business Days prior to the commencement of such Interest Period; and 
  
 “Eurodollar Reserve Percentage” means, for any day during any Interest Period, the reserve percentage (expressed as a
decimal, carried out to five decimal places) in effect on such day, whether or not applicable to any Lender, under regulations issued from time to time by the Board of Governors of the Federal Reserve System of the United States for determining the
maximum reserve requirement (including any emergency, supplemental or other marginal reserve requirement) with respect to Eurocurrency funding (currently referred to as “Eurocurrency liabilities”). The Eurodollar Rate for each outstanding
Eurodollar Rate Loan shall be adjusted automatically as of the effective date of any change in the Eurodollar Reserve Percentage. 
  
 “Eurodollar Rate Loan” means a Loan that bears interest at a rate based on the Eurodollar Rate. 
  
 “Event of Default” means any of the events or circumstances
specified in Section 8.01. 
  
 “Exchange
Act” means the Securities Exchange Act of 1934 and the regulations promulgated thereunder. 
  
 “Existing Credit Agreement” means that certain Credit Agreement, dated as of December 19, 2003, entered into among the Borrower, the
Lenders, the Administrative Agent, the Documentation Agent and the Collateral Agent. 
  
 “Federal Funds Rate” means, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by
Federal funds brokers on such day, as published by the Federal Reserve Bank on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the “Federal Funds Rate” for such day shall be
such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the “Federal Funds Rate” for such
day shall be the average rate charged to Bank of America on such day on such transactions as determined by the Administrative Agent. 
  

 7 

 “Fee Letter” means that certain letter agreement, dated as of October 15, 2004, among
the Borrower, the Arrangers, the Administrative Agent, the Documentation Agent and the Collateral Agent. 
  
 “Foreign Lender” has the meaning set forth in Section 10.15. 
  
 “FRB” means the Board of Governors of the Federal Reserve System of the United States of America.

  
 “Fund” has the meaning set forth in
Section 10.07(g). 
  
 “GAAP” means
generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting
Standards Board or such other principles as may be approved by a significant segment of the accounting profession, that are applicable to the circumstances as of the date of determination, consistently applied. 
  
 “Governmental Authority” means any nation or government, any
state or other political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, administrative tribunal, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative
powers or functions of or pertaining to government, and any corporation or other entity owned or controlled, through stock or capital ownership or otherwise, by any of the foregoing. 
  
 “Guarantors” means, at any time any determination thereof is to be made, the Persons identified on
Schedule A, all Material Domestic Subsidiaries and all other Persons who, following the Closing Date, execute and deliver a Guaranty. 
  
 “Guaranty” means a Continuing Guaranty Agreement, substantially in the form of Exhibit E, made by a Guarantor in favor of the
Administrative Agent on behalf of the Lenders. 
  
 “Guaranty Obligation” means, as to any Person, any (a) any obligation, contingent or otherwise, of such Person guarantying or having the economic effect of guarantying any Indebtedness or other obligation payable or
performable by another Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of such Person, direct or indirect, (i) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Indebtedness or other obligation, (ii) to purchase or lease property, securities or services for the purpose of assuring the obligee in respect of such Indebtedness or other obligation of the payment or performance of such
Indebtedness or other obligation, (iii) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation, or
(iv) entered into for the purpose of assuring in any other manner the obligee in respect of such Indebtedness or other obligation of the payment or performance thereof or to protect such obligee against loss in respect thereof (in whole or in part),
or (b) any Lien on any assets of such Person securing any Indebtedness or other obligation of any other Person, whether or not such Indebtedness or other obligation is assumed by such Person. The amount of any Guaranty Obligation shall be deemed to
be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guaranty Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in
respect thereof as determined by the guarantying Person in good faith. 
  
 “Hazardous Materials” means, collectively, as of any date: (a) any petroleum or petroleum products, flammable explosives, radioactive materials, asbestos in any form that is or could become 
  

 8 

 friable, urea formaldehyde foam insulation, and transformers or other equipment that contain dielectric fluid containing
polychlorinated biphenyls (PCB’s); (b) any chemicals or other materials or substances which as of such date are defined as or included in the definition of “hazardous substances,” “hazardous wastes,” “hazardous
materials,” “extremely hazardous wastes,” “restricted hazardous wastes,” “toxic substances,” “toxic pollutants,” “contaminants,” “infectious wastes,” “pollutants” or words of
similar import under any Environmental Law; and (c) any other chemical or other material or substance, exposure to which or use of which as of such date is prohibited, limited or regulated under any Environmental Law. 
  
 “Indebtedness” means, as to any Person at a particular time,
all of the following, whether or not included as indebtedness or liabilities in accordance with GAAP: (a) all obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or
other similar instruments; (b) all direct or contingent obligations of such Person arising under letters of credit (including standby and commercial), reimbursement agreements, bankers’ acceptances, bank guaranties, surety bonds and similar
instruments (in each case, whether or not such obligations are contingent or absolute; (c) net obligations under any Swap Contract in an amount equal to the Swap Termination Value thereof; (d) all obligations of such Person to pay the deferred
purchase price of property or services (other than trade accounts payable in the Ordinary Course of Business); (e) indebtedness (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by such Person (including
indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse; (f) capital leases and Synthetic Lease Obligations; and (g) all
Guaranty Obligations of such Person in respect of any of the foregoing. For all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture (other than a joint venture that is itself a
corporation or limited liability company) in which such Person is a general partner or a joint venturer, unless such Indebtedness is expressly made non-recourse to such Person (subject only to customary exceptions acceptable to the Required
Lenders). The amount of any capital lease or Synthetic Lease Obligation as of any date shall be deemed to be the amount of Attributable Indebtedness in respect thereof as of such date. 
  
 “Indemnified Liabilities” has the meaning set forth in Section 10.05. 
  
 “Indemnitees” has the meaning set forth in Section
10.05. 
  
 “Information” has the meaning set
forth in Section 10.08. 
  
 “Intangible
Assets” means assets that are considered to be intangible assets under GAAP, including customer lists, goodwill, computer software, copyrights, trade names, trade marks, patents, unamortized deferred charges, unamortized debt discount and
capitalized research and development costs. 
  
 “Interest
Payment Date” means, (a) as to any Eurodollar Rate Loan, the last day of each Interest Period applicable to such Loan; provided that, if any Interest Period for a Eurodollar Rate Loan exceeds three months, the respective dates that fall
every three months after the beginning of such Interest Period shall also be Interest Payment Dates; and (b) as to any Base Rate Loan, the third Business Day of each calendar month during the term hereof. 
  
 “Interest Period” means, as to each Eurodollar Rate Loan,
the period commencing on the date such Eurodollar Rate Loan is disbursed or converted to or continued as a Eurodollar Rate Loan and ending on the date one, two, three or six months thereafter, as selected by the Borrower in its Loan Notice;
provided that: (a) any Interest Period that would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless, in the case of a Eurodollar Rate Loan, such Business Day falls in another
calendar month, in which case such Interest Period shall end on the next preceding Business Day; (b) any Interest Period pertaining to a Eurodollar Rate Loan that begins on 
  

 9 

 the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last Business Day of the calendar month at the end of such Interest Period; and (c) no Interest Period shall extend beyond the scheduled Maturity Date. 
  
 “Investment” means, as to any Person, any acquisition
(including any Acquisition) or investment by such Person, whether by means of (a) the purchase or other acquisition of capital stock or other securities of another Person, (b) a loan, advance or capital contribution to, guaranty of debt of, or
purchase or other acquisition of any other debt or equity participation or interest in, another Person, including any partnership or joint venture interest in such other Person, or (c) the purchase or other acquisition (in one transaction or a
series of transactions) of assets of another Person that constitute a business unit. For purposes of covenant compliance, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in
the value of such Investment. 
  
 “IP Rights” has
the meaning set forth in Section 5.16. 
  
 “IRS” means the United States Internal Revenue Service. 
  
 “Joint Venture” means a single-purpose corporation, partnership, limited liability company, joint venture or other similar legal arrangement (whether created by contract or conducted through a
separate legal entity) now or hereafter formed by one Person with another Person in order to conduct a common venture or enterprise with such Person. 
  
 “Laws” means, collectively, all international, foreign, federal, state and local statutes, treaties, rules, guidelines, regulations,
ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority, in each case whether or not having the force of law. 
  
 “Lender” has the meaning set forth in the introductory
paragraph hereto. 
  
 “Lending Office” means, as
to any Lender, the office or offices of such Lender described as such on Schedule 10.02, or such other office or offices as a Lender may from time to time notify the Borrower and the Administrative Agent. 
  
 “Leverage Ratio” means, as of any date of determination, the
ratio of (a) Consolidated Funded Indebtedness on such date to (b) Consolidated EBITDA for the period of the four consecutive fiscal quarters ending on such date. 
  
 “Lien” means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien
(statutory or other), charge, or preference, priority or other security interest or preferential arrangement of any kind or nature whatsoever (including any conditional sale or other title retention agreement, any financing lease having
substantially the same economic effect as any of the foregoing, and the filing of any financing statement under the Uniform Commercial Code or comparable Laws of any jurisdiction), including the interest of a purchaser of accounts receivable.

  
 “Loan” means an extension of credit by a
Lender to the Borrower under Article II in the form of a loan. 
  

 10 

 “Loan Documents” means this Agreement, all Notes, the Fee Letter, all Loan Notices, all
Compliance Certificates, all Guaranties, the Security Documents, and all other agreements, documents and instruments (with the exception of Swap Contracts except to the extent expressly required pursuant to the terms hereof), executed and delivered
by a Loan Party in connection with the transactions contemplated hereby in favor of the Administrative Agent, the Documentation Agent, the Collateral Agent, the Arrangers or any Lender. 
  
 “Loan Notice” means a notice of (a) a Borrowing, (b) a conversion of Loans from one Type to the other, or
(c) a continuation of Loans as the same Type, pursuant to Section 2.02(a), which, if in writing, shall be substantially in the form of Exhibit A. 
  

“Loan Parties” means, collectively, the Borrower and each Guarantor. 
  
 “Material Adverse Effect” means (a) a material adverse change in, or a material adverse effect upon, the
operations, business, properties, condition (financial or otherwise) or prospects of the Borrower or the Borrower and its Subsidiaries taken as a whole; (b) a material impairment of the ability of any Loan Party to perform its obligations under any
Loan Document to which it is a party; or (c) a material adverse effect upon the legality, validity, binding effect or enforceability against any Loan Party of any Loan Document to which it is a party. 
  
 “Material Domestic Subsidiary” means any Material Subsidiary
organized under the laws of the United States or any state or territory thereof. 
  
 “Material Subsidiary” means any Subsidiary that meets either of the following conditions: (a) such Subsidiary’s total net revenues for the period of the immediately preceding four fiscal quarters
is equal to or greater than ten percent (10.0%) of the consolidated total net revenues of the Borrower and its Subsidiaries for such period, determined in accordance with GAAP, in each case as reflected in the most recent annual or quarterly
financial statements of the Borrower required to be delivered pursuant to Section 6.01; or (b) such Subsidiary’s total assets, as of the last day of the immediately preceding fiscal quarter, are equal to or greater than ten percent
(10.0%) of the consolidated total assets of the Borrower and its Subsidiaries as of such date, determined in accordance with GAAP, in each case as reflected in the most recent annual or quarterly (as applicable) financial statements of the Borrower
required to be delivered pursuant to Section 6.01. 
  
 “Maturity Date” means, as applicable, the Revolving Line of Credit Maturity Date or the Term Commitment Maturity Date. 
  
 “Maximum Rate” has the meaning set forth in Section 10.10. 
  
 “MDA” means Medical Device Alliance Inc., a Nevada corporation. 
  
 “Multiemployer Plan” means any employee benefit plan of the
type described in Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate makes or is obligated to make contributions, or during the preceding three calendar years, has made or been obligated to make contributions. 
  
 “Non-Guarantor Subsidiary” has the meaning set forth in
Section 2.12. 
  
 “Notes” means,
collectively, the Revolving Line of Credit Notes and the Term Commitment Notes. 
  

 11 

 “Obligations” means all advances to, and debts, liabilities, obligations, covenants and
duties of, any Loan Party arising under any Loan Document, whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising and including interest that accrues after
the commencement by or against any Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief Laws naming such Person as the debtor in such proceeding. 
  
 “Opus” means Opus Medical, Inc., a California corporation. 
  
 “Opus Merger Corporation Sub” means OC Merger Sub
Corporation, a California corporation and a wholly owned Subsidiary of the Borrower. 
  
 “Opus Merger LLC Sub” means OC Acquisition Sub LLC, a California limited liability company and a wholly owned Subsidiary of the Borrower. 
  
 “Ordinary Course of Business” means, in respect of any transaction involving the Borrower or any Subsidiary
of the Borrower, the ordinary course of such Person’s business, substantially as conducted by any such Person prior to or as of the Closing Date, and undertaken by such Person in good faith and not for purposes of evading any covenant or
restriction in any Loan Document. 
  
 “Organization
Documents” means: (a) with respect to any corporation, such Person’s certificate or articles of incorporation and its bylaws; (b) with respect to any limited liability company, such Person’s certificate of formation or articles of
organization and its operating agreement; and (c) with respect to any partnership, Joint Venture, trust or other form of business entity, such Person’s applicable agreement of formation and any agreement, instrument, filing or notice with
respect thereto filed in connection with its formation with the secretary of state or other department in the state of its formation, in each case as amended from time to time. 
  
 “Other Taxes” has the meaning set forth in Section 3.01(b). 
  
 “Outstanding Amount” means, with respect to Loans on any
date, the aggregate outstanding principal amount thereof after giving effect to any Borrowings and prepayments or repayments of Loans occurring on such date. 
  
 “Parallax” means Parallax Medical, Inc., a Delaware corporation. 
  
 “Participant” has the meaning set forth in Section 10.07(d). 
  
 “Patriot Act” means the USA Patriot Act (Title III of Pub.
L. 107-56 (signed into law October 26, 2001)). 
  
 “PBGC” means the Pension Benefit Guaranty Corporation. 
  
 “Pension Plan” means any “employee pension benefit plan” (as such term is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA and is
sponsored or maintained by the Borrower or any ERISA Affiliate or to which the Borrower or any ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple employer plan (as described in Section 4064(a) of ERISA) has
made contributions at any time during the immediately preceding five plan years. 
  

 12 

 “Person” means any individual, trustee, corporation, general partnership, limited
partnership, limited liability company, joint stock company, trust, unincorporated organization, bank, business association, firm, Joint Venture or Governmental Authority. 
  
 “Plan” means any “employee benefit plan” (as such term is defined in Section 3(3) of ERISA)
established by the Borrower or any ERISA Affiliate. 
  
 “Pro Rata Share” means, with respect to each Lender, the percentage (carried out to the ninth decimal place) of the Aggregate Commitments, the Revolving Line of Credit Commitment Amount or the Term Commitment Amount, as
applicable, set forth opposite the name of such Lender on Schedule 2.01, as such share may be adjusted as contemplated herein. 
  
 “Quarterly Payment Date” means the last Business Day of each March, June, September and December. 
  
 “Quick Ratio” means, as of any date of determination, for
the Borrower and its Subsidiaries on a consolidated basis, the ratio of (a) the sum of unrestricted cash, unrestricted cash equivalents and accounts receivable convertible into cash to (b) the sum of (i) total current liabilities plus
(ii) the Outstanding Amount of all Revolving Line of Credit Loans plus (iii) the current portion of the Outstanding Amount of all Term Commitment Loans. 
  

“Register” has the meaning set forth in Section 10.07(c). 
  
 “Release” means any release, spill, emission, leaking, pumping, injection, deposit, disposal, discharge,
dispersal, leaching or migration into the indoor or outdoor environment, including the movement of Hazardous Materials through ambient air, soil, surface water, ground water, wetlands, land or subsurface strata. 
  
 “Reportable Event” means any of the events set forth in
Section 4043(c) of ERISA, other than events for which the thirty (30) day notice period has been waived. 
  
 “Required Lenders” means, as of any date of determination, Lenders whose Voting Percentages aggregate more than fifty percent (50.0%).

  
 “Responsible Officer” means the president,
chief operating officer, chief executive officer, chief financial officer, treasurer, assistant treasurer or secretary of a Loan Party. Any document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be conclusively
presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Loan Party and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Loan Party. 
  
 “Restricted Payment” means any dividend or other
distribution (whether in cash, securities or other property) with respect to any capital stock of the Borrower or any Subsidiary, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit on
account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such capital stock or of any option, warrant or other right to acquire any such capital stock. 
  
 “Revolving Line of Credit” means a credit accommodation in
the maximum principal amount of the Revolving Line of Credit Commitment Amount, as described more fully in Section 2.01(a). 
  
 “Revolving Line of Credit Commitment Amount” means, as of any date of determination, Twenty Million Dollars ($20,000,000.00), as such
amount may be reduced from time to time in accordance with the provisions hereof. 
  

 13 

 “Revolving Line of Credit Loan” means a Loan under the Revolving Line of Credit.

  
 “Revolving Line of Credit Maturity Date”
means: (a) April 30, 2007; or (b) such earlier date upon which the Revolving Line of Credit is or the Aggregate Commitments are terminated in accordance with the terms hereof. 
  
 “Revolving Line of Credit Notes” means the promissory notes executed by the Borrower in favor of each
Lender to evidence Borrowings under the Revolving Line of Credit, substantially in the form of Exhibit B attached hereto. 
  
 “SEC” means the Securities and Exchange Commission or any successor or similar Governmental Authority. 
  
 “Security Agreement” means a Security Agreement,
substantially in the form of Exhibit G, made by the Borrower and all Guarantors in favor of the Collateral Agent on behalf of the Secured Creditors (as such term is defined in such agreement). 
  
 “Security Documents” means, collectively, the Security
Agreement and the Trademark Security Agreement and any and all agreements, documents and instruments entered into in connection with the foregoing. 
  
 “Solvent” means, as to any Person at any time, that: (a) the fair value of the property of such Person is greater than the amount of such
Person’s liabilities (including disputed, contingent and unliquidated liabilities) as such value is established and liabilities evaluated for purposes of section 101(32) of the Bankruptcy Code and, in the alternative, for purposes of the
California Uniform Fraudulent Transfer Act; (b) the present fair saleable value of the property of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts as they become absolute and
matured; (c) such Person is able to realize upon its property and pay its debts and other liabilities (including disputed, contingent and unliquidated liabilities) as they mature in the normal course of business; (d) such Person does not intend to,
and does not believe that it will, incur debts or liabilities beyond such Person’s ability to pay as such debts and liabilities mature; and (e) such Person is not engaged in business or a transaction for which such Person’s property would
constitute unreasonably small capital. 
  
 “Specified
Acquisition” means the Acquisition by the Borrower of Opus pursuant to and substantially in accordance with the terms of the Opus Acquisition Agreements. 
  
 “Specified Acquisition Agreements” means, collectively: (a) that certain Agreement and Plan of Merger,
dated as of September 3, 2004 (the “Merger Agreement”), by and among the Borrower, Opus Merger Corporation Sub, Opus Merger LLC Sub, Opus, and for purposes of Articles 3, 8 and 11 of such agreement, James W. Hart and Steven L. Gex,
as the Shareholders’ Agents (as defined therein), filed by the Borrower as an exhibit to the Borrower’s Form 8-K filed with the SEC on September 3, 2004; and (b) the other agreements, documents and instruments required to be entered into
in connection with the Merger Agreement on or before the Merger (as defined in the Merger Agreement). 
  
 “Subsidiary” of a Person means a corporation, partnership, Joint Venture, limited liability company or other business entity of which a
majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body (other than securities or interests having such power only by reason of the happening of a contingency) are at
the time beneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, or both, by such Person. Unless otherwise specified, all references herein to a “Subsidiary” or to
“Subsidiaries” shall refer to a Subsidiary or Subsidiaries of the Borrower. 
  

 14 

 “Swap Contract” means (a) any and all rate swap transactions, basis swaps, credit
derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or
forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot
contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) any
and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International
Foreign Exchange Master Agreement, or any other master agreement (including all schedules thereto), including any such obligations or liabilities under any such master agreement (including all schedules thereto). 
  
 “Swap Termination Value” means, in respect of any one or
more Swap Contracts, after taking into account the effect of any legally enforceable netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a) the amount(s) determined as the mark-to-market value(s) for such Swap Contracts, as determined based upon one or more
mid-market or other readily available quotations provided by any recognized dealer in such Swap Contracts (which may include any Lender). 
  
 “Synthetic Lease Obligation” means the monetary obligation of a Person under (a) a so-called synthetic, off-balance sheet or tax
retention lease, or (b) an agreement for the use or possession of property creating obligations that do not appear on the balance sheet of such Person but which, upon the insolvency or bankruptcy of such Person, would be characterized as the
indebtedness of such Person (without regard to accounting treatment). 
  
 “Taxes” has the meaning set forth in Section 3.01(a). 
  
 “Term Commitment” means a credit accommodation in the maximum principal amount of the Term Commitment Amount, as described more fully in Section 2.01(b). 
  
 “Term Commitment Amount” means, as of any date of
determination, Thirty Million Dollars ($30,000,000.00), as such amount may be reduced from time to time in accordance with the provisions hereof. 
  
 “Term Commitment Loan” means a Loan under the Term Commitment. 
  
 “Term Commitment Maturity Date” means: (a) September 30, 2011; or (b) such earlier date upon which the Term
Commitment is or the Aggregate Commitments are terminated in accordance with the terms hereof. 
  
 “Term Commitment Notes” means the promissory notes executed by the Borrower in favor of each Lender to evidence Borrowings under the Term
Commitment, substantially in the form of Exhibit F attached hereto. 
  

 15 

 “Trademark Security Agreement” means a Trademark Security Agreement, substantially in
the form of Exhibit H, made by the Borrower in favor of the Collateral Agent on behalf of the Secured Creditors (as such term is defined in such agreement). 
  
 “Type” means, with respect to a Loan, its character as a Base Rate Loan or a Eurodollar Rate Loan.

  
 “Unfunded Pension Liability” means the excess
of a Pension Plan’s benefit liabilities under Section 4001(a)(16) of ERISA, over the current value of that Pension Plan’s assets, determined in accordance with the assumptions used for funding the Pension Plan pursuant to Section 412 of
the Code for the applicable plan year. 
  
 “Unused
Commitment Fee” has the meaning set forth in Section 2.07(a). 
  
 “Voting Percentage” means, as to any Lender, (a) at any time when the Aggregate Commitments are in effect, such Lender’s Pro Rata Share and (b) at any time after the termination of the Aggregate
Commitments, the percentage (carried out to the ninth decimal place) which the Outstanding Amount of such Lender’s Loans then comprises of the Outstanding Amount of all Loans; provided that, if any Lender has failed to fund any portion
of the Loans, such Lender’s Voting Percentage shall be deemed to be zero, and the respective Pro Rata Shares and Voting Percentages of the other Lenders shall be recomputed for purposes of this definition and the definition of “Required
Lenders” without regard to such Lender’s Commitment or the outstanding amount of its Loans, as the case may be. 
  
 “Wells Fargo” means Wells Fargo Bank, National Association. 
  
 1.02 Other Interpretive Provisions. 
  
 With reference to this Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan
Document: 
  
 (a) The meanings of defined terms are equally
applicable to the singular and plural forms of the defined terms. 
  
 (b) The words “herein” and “hereunder” and words of similar import when used in any Loan Document shall refer to such Loan Document as a whole and not to any particular provision thereof. Article, Section,
Exhibit and Schedule references are to the Loan Document in which such reference appears. The term “including” is by way of example and not limitation. The term “documents” includes any and all instruments,
documents, agreements, certificates, notices, reports, financial statements and other writings, however evidenced, whether in physical or electronic form. 
  
 (c) In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and
including”; the words “to” and “until” each mean “to but excluding”; and the word “through” means “to and including.” 
  
 (d) Section headings herein and in the other Loan Documents are included for
convenience of reference only and shall not affect the interpretation of this Agreement or any other Loan Document. 
  
 (e) Unless otherwise expressly provided herein: (i) references to agreements (including this Agreement) and other contractual instruments shall be deemed
to include all subsequent amendments and other modifications thereto, but only to the extent such amendments and other modifications are not prohibited by the terms of any Loan Document; and (ii) references to any statute or regulation are to be
construed as including all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting the statute or regulation. 
  

 16 

 1.03 Accounting Terms; Rounding. 
  
 (a) All accounting terms not specifically or completely defined herein shall be construed in conformity with, and all
financial data required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect from time to time, applied in a manner consistent with that used in preparing the Audited
Financial Statements, except as otherwise specifically prescribed herein. 
  
 (b) If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Borrower or the Required Lenders shall so request, the
Administrative Agent, the Lenders and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders);
provided that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Borrower shall provide to the Administrative Agent and the Lenders financial
statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP.

  
 (c) Any financial ratios required to be maintained by the
Borrower pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein and rounding the result up
or down to the nearest number (with a rounding-up if there is no nearest number). 

	1.04	References to Agreements and Laws. 

  
 1.04 References to Agreements and Laws. 
  
 Unless otherwise expressly provided herein, (a) references to agreements (including the Loan Documents) and other contractual instruments shall be deemed
to include all subsequent amendments, restatements, extensions, supplements and other modifications thereto, but only to the extent that such amendments, restatements, extensions, supplements and other modifications are not prohibited by any Loan
Document; and (b) references to any Law shall include all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting such Law. 
  

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 ARTICLE II. 
 THE COMMITMENTS AND THE LOANS 
  
 2.01 Loans. 
  
 (a) Subject to the terms and conditions set forth herein, each Lender severally agrees to make loans under the Revolving Line of Credit to the Borrower
from time to time on any Business Day during the period from the Closing Date to the Maturity Date in an aggregate amount not to exceed at any time outstanding the amount of such Lender’s Pro Rata Share of the Revolving Line of Credit
Commitment Amount; provided that, after giving effect to any Borrowing, (i) the aggregate Outstanding Amount of all Revolving Line of Credit Loans shall not exceed the Revolving Line of Credit Commitment Amount, (ii) the aggregate Outstanding
Amount of all Loans shall not exceed the Aggregate Commitments and (iii) the aggregate Outstanding Amount of the Revolving Line of Credit Loans of any Lender shall not exceed such Lender’s Pro Rata Share of the Revolving Line of Credit
Commitment Amount. Within the limits of each Lender’s Pro Rata Share of the Revolving Line of Credit Commitment Amount, and subject to the other terms and conditions hereof, the Borrower may borrow under this Section 2.01(a), prepay
under Section 2.03, and reborrow under this Section 2.01(a). Revolving Line of Credit Loans may be Base Rate Loans or Eurodollar Rate Loans, as further provided herein. 
  
 (b) Subject to the terms and conditions set forth herein, each Lender severally agrees to make term loans under the Term
Commitment to the Borrower on a single Business Day during the period from the Closing Date to and including November 16, 2004 in an aggregate amount not to exceed such Lender’s Pro Rata Share of the Term Commitment Amount; provided
that, after giving effect to any Borrowing, (i) the aggregate Outstanding Amount of all Term Commitment Loans shall not exceed the Term Commitment Amount, (ii) the aggregate Outstanding Amount of all Loans shall not exceed the Aggregate Commitments
and (iii) the aggregate Outstanding Amount of the Term Commitment Loans of any Lender shall not exceed such Lender’s Pro Rata Share of the Term Commitment Amount. Subject to the other terms and conditions hereof, the Borrower may borrow under
this Section 2.01(b) and prepay under Section 2.03; provided that, once repaid or prepaid, no amounts may be reborrowed under this Section 2.01(b). Term Commitment Loans may be Base Rate Loans or Eurodollar Rate Loans, as
further provided herein. 
  
 2.02 Borrowings, Conversions and
Continuations of Loans. 
  
 (a) Each Borrowing, each
conversion of Loans from one Type to a different Type and each continuation of Loans as the same Type shall be made upon the Borrower’s irrevocable notice to the Administrative Agent, which may be given by telephone. Each such notice must be
received by the Administrative Agent not later than 11:00 a.m., California time, (i) three (3) Business Days prior to the requested date of any Borrowing of, conversion to or continuation of Eurodollar Rate Loans or of any conversion of Eurodollar
Rate Loans to Base Rate Loans, and (ii) on the requested date of any Borrowing of Base Rate Loans. Each such telephonic notice must be confirmed immediately by delivery to the Administrative Agent of a written Loan Notice (which may be sent by
facsimile), appropriately completed and signed by one (1) Responsible Officer of the Borrower. Each Borrowing of Loans, each conversion of Loans from one Type to another Type, and each continuation of Eurodollar Rate Loans shall be in a principal
amount of Five Hundred Thousand Dollars ($500,000.00) or a whole multiple of One Hundred Thousand Dollars ($100,000.00) in excess thereof. Each Loan Notice (whether telephonic or written) shall specify (i) whether the Borrower is requesting a
Borrowing, a conversion of Loans from one Type to the other, or a continuation of Loans as the same Type, (ii) in the case of a Borrowing, whether such Borrowing is to be a Revolving Line of Credit Loan or a Term Commitment Loan, (iii) the requested
date of the Borrowing, conversion or continuation, as the case may be (which shall be a Business Day), (iv) the principal amount of Loans to be borrowed, converted or continued, (v) the Type of Loans to be borrowed or to which existing Loans are to
be converted, and (vi) if applicable, the 
  

 18 

 duration of the Interest Period with respect thereto. If the Borrower fails to specify a Type of Loan in a Loan Notice or
if the Borrower fails to give a timely notice requesting a conversion or continuation, then the applicable Loans shall be made or continued as, or converted to, Base Rate Loans. Any such automatic conversion to Base Rate Loans shall be effective as
of the last day of the Interest Period then in effect with respect to the applicable Eurodollar Rate Loans. If the Borrower requests a Borrowing of, conversion to, or continuation of Eurodollar Rate Loans in any such Loan Notice, but fails to
specify an Interest Period, it will be deemed to have specified an Interest Period of one month. If the Borrower fails to specify whether any requested Borrowing is to be a Revolving Line of Credit Loan or a Term Commitment Loan, then the applicable
Loans shall be made (subject to the other terms and conditions contained herein) as Revolving Line of Credit Loans. 
  
 (b) Following receipt of a Loan Notice, the Administrative Agent shall promptly notify each Lender of its Pro Rata Share of the applicable Loans, and if
no timely notice of a conversion or continuation is provided by the Borrower, the Administrative Agent shall notify each Lender of the details of any automatic conversion to Base Rate Loans described in the preceding subsection. In the case of a
Borrowing, each Lender shall make the amount of its Loan available to the Administrative Agent in immediately available funds at the Administrative Agent’s Office not later than 1:00 p.m., California time, on the Business Day specified in the
applicable Loan Notice. Upon satisfaction of the applicable conditions set forth in Section 4.02 (and, if such Borrowing is the initial Borrowing hereunder, Section 4.01), the Administrative Agent shall make all funds so received
available to the Borrower in like funds as received by the Administrative Agent either by (i) crediting the account of the Borrower on the books of Bank of America with the amount of such funds or (ii) wire transfer of such funds, in each case in
accordance with instructions provided to the Administrative Agent by the Borrower. 
  
 (c) Except as otherwise provided herein, a Eurodollar Rate Loan may be continued or converted only on the last day of the Interest Period for such Eurodollar Rate Loan. During the existence of a Default or Event of
Default, no Loans may be requested as, converted to or continued as Eurodollar Rate Loans without the consent of the Required Lenders, and the Required Lenders may demand that any or all of the then outstanding Eurodollar Rate Loans be converted
immediately to Base Rate Loans. 
  
 (d) The Administrative Agent
shall promptly notify the Borrower and the Lenders of the interest rate applicable to any Eurodollar Rate Loan upon determination of such interest rate. The determination of the Eurodollar Rate by the Administrative Agent shall be conclusive in the
absence of manifest error. The Administrative Agent shall notify the Borrower and the Lenders of any change in Bank of America’s prime rate used in determining the Base Rate promptly following the public announcement of such change. 

 
 (e) After giving effect to all Borrowings, all conversions of Loans from
one Type to the other, and all continuations of Loans as the same Type, there shall not be more than ten Interest Periods in effect with respect to Loans. 
  
 2.03 Prepayments. 
  
 (a) The Borrower may, upon notice to the Administrative Agent, at any time or from time to time voluntarily prepay Loans in whole or in part without
premium or penalty; provided that (i) such notice must be received by the Administrative Agent not later than 11:00 a.m., California time, (A) three (3) Business Days prior to any date of prepayment of Eurodollar Rate Loans, and (B) on the
date of prepayment of Base Rate Loans; and (ii) any prepayment of Loans shall be in a principal amount of Five Hundred Thousand Dollars ($500,000.00) or a whole multiple of One Hundred Thousand Dollars ($100,000.00) in excess thereof. Each such
notice shall specify the date and amount of such prepayment and the Type(s) of Loans to be prepaid. The Administrative Agent will promptly notify each Lender of its receipt of each such notice, and of such Lender’s Pro Rata Share of such
prepayment. If such notice is 
  

 19 

 given by the Borrower, the Borrower shall make such prepayment and the payment amount specified in such notice shall be
due and payable on the date specified therein. Any prepayment of a Eurodollar Rate Loan shall be accompanied by all accrued interest thereon, together with any additional amounts required pursuant to Section 3.05. Each such prepayment shall
be applied to the Loans of the Lenders in accordance with their respective Pro Rata Shares. 
  
 (b) If for any reason the Outstanding Amount of all Loans at any time exceeds the Aggregate Commitments then in effect, then Borrower shall immediately prepay Loans in an aggregate amount equal to such excess. If for
any reason the Outstanding Amount of all Revolving Line of Credit Loans at any time exceeds the Revolving Line of Credit Commitment Amount then in effect, then the Borrower shall immediately prepay the Revolving Line of Credit Loans in an aggregate
amount equal to such excess. If for any reason the Outstanding Amount of all Term Commitment Loans at any time exceeds the Term Commitment Amount then in effect, then the Borrower shall immediately prepay the Term Commitment Loans in an aggregate
amount equal to such excess. 
  
 2.04 Reduction or Termination
of Commitments. 
  
 The Borrower may, upon notice to the
Administrative Agent, terminate the Revolving Line of Credit Commitment Amount or the Term Commitment Amount, or permanently reduce the Revolving Line of Credit Amount to an amount not less than the then Outstanding Amount of all Revolving Line of
Credit Loans or permanently reduce the Term Commitment Amount to an amount not less than the then Outstanding Amount of all Term Commitment Loans; provided that (i) any such notice shall be received by the Administrative Agent not later than
9:00 a.m., California time, five (5) Business Days prior to the date of termination or reduction, and (ii) any such partial reduction shall be in an aggregate amount of Five Hundred Thousand Dollars ($500,000.00) or a whole multiple of One Hundred
Thousand Dollars ($100,000.00) in excess thereof. The Administrative Agent shall promptly notify the Lenders of any such notice of reduction or termination of the Revolving Line of Credit Commitment Amount or the Term Commitment Amount. Once reduced
in accordance with this Section, neither the Revolving Line of Credit Commitment Amount nor the Term Commitment Amount may be increased. Any reduction of the Revolving Line of Credit Commitment Amount or the Term Commitment Amount shall be applied
to the applicable Commitment of each Lender according to its Pro Rata Share thereof. All fees accrued until the effective date of any termination of any of the Aggregate Commitments shall be paid on the effective date of such termination.

  
 2.05 Repayment of Loans. 
  
 (a) The Borrower shall repay to the Lenders on the Revolving Line of Credit
Maturity Date the then Outstanding Amount of all Revolving Line of Credit Loans, together with all accrued and unpaid interest thereon. Notwithstanding anything to the contrary contained herein, the Borrower shall cause the Outstanding Amount of all
Revolving Line of Credit Loans to be Zero Dollars ($0.00) for a period of at least thirty (30) consecutive days during each twelve (12) month period following the Closing Date. 
  
 (b) The Borrower shall repay to the Lenders the Outstanding Amount of all Term Commitment Loans as follows: (a) commencing
on December 31, 2004 and continuing on each and every Quarterly Payment Date occurring thereafter up to and including the Quarterly Payment Date immediately preceding the Term Commitment Maturity Date, equal, consecutive installments of principal in
an amount equal to One Million Seventy-One Thousand Four Hundred Twenty-Eight Dollars and Fifty-Seven Cents ($1,071,428.57) each; and (b) on the Term Commitment Maturity Date, the then remaining Outstanding Amount of all Term Commitment Loans. In
addition, on the Term Commitment Maturity Date, the Borrower shall repay to the Lenders all accrued and unpaid interest on the Term Commitment Loans. 
  

 20 

 2.06 Interest. 
  
 (a) Subject to the provisions of subsection (b) below, (i) each Eurodollar Rate Loan shall bear interest on the outstanding
principal amount thereof for each Interest Period at a rate per annum equal to the Eurodollar Rate for such Interest Period plus the Applicable Rate; and (ii) each Base Rate Loan shall bear interest on the outstanding principal amount thereof
from the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate. 
  
 (b) While any Event of Default exists or after acceleration, the Borrower shall pay interest on the principal amount of all outstanding Obligations at a
fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Law. Accrued and unpaid interest on past due amounts (including interest on past due interest) shall be due and payable upon
demand. 
  
 (c) Interest on each Loan shall be due and payable in
arrears on each Interest Payment Date applicable thereto and at such other times as may be specified herein. Interest hereunder shall be due and payable in accordance with the terms hereof both before and after judgment, and both before and after
the commencement of any proceeding under any Debtor Relief Law. 
  
 2.07 Fees. 
  
 (a) The Borrower shall pay to the
Administrative Agent for the account of each Lender in accordance with its Pro Rata Share of the Aggregate Commitments, an unused commitment fee (the “Unused Commitment Fee”) equal to the Applicable Rate multiplied by the
actual daily amount by which the Revolving Line of Credit Amount exceeds the Outstanding Amount of Revolving Line of Credit Loans during a quarterly period. The Unused Commitment Fee shall accrue at all times from the Closing Date until the Maturity
Date and shall be due and payable quarterly in arrears on each Quarter Payment Date, commencing with the first Quarterly Payment Date to occur after the Closing Date, and on the Maturity Date. The Unused Commitment Fee shall be calculated quarterly
in arrears, and, if there is any change in the Applicable Rate during any quarter, the actual daily amount shall be computed and multiplied by the Applicable Rate separately for each period during such quarter that such Applicable Rate was in
effect. The Unused Commitment Fee shall accrue at all times, including at any time during which one or more of the conditions in Article IV is not met. 
  

(b) The Borrower shall pay, in the amounts and at the times specified in the Fee Letter, (i) an arrangement fee to each of the Arrangers for each of
the Arranger’s own account, (ii) an annual agency fee to the Administrative Agent for the Administrative Agent’s own account and (iii) a one-time CUSIP fee. Such fees shall be fully earned when paid and shall be nonrefundable for any
reason whatsoever. 
  
 (c) On the Closing Date, the Borrower shall
pay to the Administrative Agent, for the account of the Lenders in accordance with their respective Pro Rata Shares of the Aggregate Commitments, an upfront fee in an amount set forth in the Fee Letter. Such upfront fees are for the credit
facilities committed by the Lenders under this Agreement and are fully earned on the date paid. The upfront fee paid to each Lender is solely for its own account and is nonrefundable for any reason whatsoever. 
  
 2.08 Computation of Interest and Fees. 
  
 All interest on the Loans and other amounts owing hereunder and all fees
shall be calculated on the basis of a year of three hundred sixty (360) days and the actual number of days elapsed, which results in a higher yield to the payee thereof than a method based on a year of three hundred sixty-five (365) or three hundred
sixty-six (366) days. Interest shall accrue on each Loan for the day on which such Loan is made and shall not accrue on a Loan, or any portion thereof, for the day on which the Loan (or any such portion) is paid; provided that any Loan that
is repaid on the same day on which it is made shall bear interest for one (1) day. 
  

 21 

 2.09 Evidence of Debt. 
  
 The Loans made by each Lender shall be evidenced by one or more accounts or records maintained by such Lender and by the
Administrative Agent in the ordinary course of business. The accounts or records maintained by the Administrative Agent and each Lender shall be conclusive (absent manifest error) of the amount of the Loans made by the Lenders to the Borrower and
all interest and payments thereon. Any failure to so record or any error in doing so shall not, however, limit or otherwise affect the obligation of the Borrower hereunder to pay any amount owing with respect to the Loans. In the event of any
conflict between the accounts and records maintained by any Lender and the accounts and records of the Administrative Agent in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest
error. Upon the request of any Lender made through the Administrative Agent, such Lender’s Loans may, in addition to such accounts or records, be evidenced by, in the case of Revolving Line of Credit Loans, a Revolving Line of Credit Note, and,
in the case of Term Commitment Loans, by a Term Commitment Note. Each Lender may attach schedules to its Note(s) and endorse thereon the date, Type (if applicable), amount and maturity of the applicable Loans and payments with respect thereto.

  
 2.10 Payments Generally. 
  
 (a) All payments to be made by the Borrower shall be made without condition
or deduction for any counterclaim, defense, recoupment or setoff. Except as otherwise expressly provided herein, all payments by the Borrower hereunder shall be made to the Administrative Agent, for the account of the respective Lenders to which
such payment is owed, at the Administrative Agent’s Office in Dollars and in immediately available funds not later than 11:00 a.m., California time, on the date specified herein. The Administrative Agent will promptly distribute to each Lender
its Pro Rata Share (or other applicable share as provided herein) of such payment in like funds as received by wire transfer to such Lender’s Lending Office. All payments received by the Administrative Agent after 11:00 a.m., California time,
shall be deemed received on the next succeeding Business Day and any applicable interest or fee shall continue to accrue. 
  
 (b) Subject to the definition of “Interest Period” contained in Section 1.01, if any payment to be made by the Borrower shall come
due on a day other than a Business Day, payment shall be made on the next following Business Day, and such extension of time shall be reflected in computing interest or fees, as the case may be. 
  
 (c) If at any time the funds received by and available to the Administrative
Agent are not sufficient to pay fully all amounts of principal, interest and fees then due hereunder, such funds shall be applied (i) first, toward costs and expenses (including reasonable Attorney Costs and amounts payable under Article
III) incurred by the Administrative Agent and each Lender, (ii) second, toward repayment of interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to
such parties, and (iii) third, toward repayment of principal then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal then due to such parties. 
  

 22 

 (d) Unless the Borrower or any Lender has notified the Administrative Agent prior to the date any payment
is required to be made by it to the Administrative Agent hereunder, that the Borrower or such Lender, as the case may be, will not make such payment, the Administrative Agent may assume that the Borrower or such Lender, as the case may be, has
timely made such payment and may (but shall not be so required to), in reliance thereon, make available a corresponding amount to the Person entitled thereto. If and to the extent that such payment was not in fact made to the Administrative Agent in
immediately available funds, then: 
  
 (i) if the
Borrower failed to make such payment, each Lender shall forthwith on demand repay to the Administrative Agent the portion of such assumed payment that was made available to such Lender in immediately available funds, together with interest thereon
in respect of each day from and including the date such amount was made available by the Administrative Agent to such Lender to the date such amount is repaid to the Administrative Agent in immediately available funds, at the Federal Funds Rate from
time to time in effect; and 
  
 (ii) if any
Lender failed to make such payment, such Lender shall forthwith on demand pay to the Administrative Agent the amount thereof in immediately available funds, together with interest thereon for the period from the date such amount was made available
by the Administrative Agent to the Borrower to the date such amount is recovered by the Administrative Agent (the “Compensation Period”) at a rate per annum equal to the Federal Funds Rate from time to time in effect. If such Lender
pays such amount to the Administrative Agent, then such amount shall constitute such Lender’s Loan included in the applicable Borrowing. If such Lender does not pay such amount forthwith upon the Administrative Agent’s demand therefor, the
Administrative Agent may make a demand therefor upon the Borrower, and the Borrower shall pay such amount to the Administrative Agent, together with interest thereon for the Compensation Period at a rate per annum equal to the rate of interest
applicable to the applicable Borrowing. Nothing herein shall be deemed to relieve any Lender from its obligation to fulfill its Commitment or to prejudice any rights that the Administrative Agent or the Borrower may have against any Lender as a
result of any default by such Lender hereunder. 
  
 A notice of
the Administrative Agent to any Lender or the Borrower with respect to any amount owing under this subsection (d) shall be conclusive, absent manifest error. 
  
 (e) If any Lender makes available to the Administrative Agent funds for any Loan to be made by such Lender as provided in the foregoing provisions of this
Article II, and such funds are not made available to the Borrower by the Administrative Agent because the conditions to the Loans set forth in Article IV are not satisfied or waived in accordance with the terms hereof, the
Administrative Agent shall promptly return such funds (in like funds as received from such Lender) to such Lender, without interest. 
  
 (f) The obligations of the Lenders hereunder to make Loans are several and not joint. The failure of any Lender to make any Loan on any date required
hereunder shall not relieve any other Lender of its corresponding obligation to do so on such date, and no Lender shall be responsible for the failure of any other Lender to so make its Loan. Nothing herein shall be deemed to obligate any Lender to
obtain the funds for any Loan in any particular place or manner or to constitute a representation by any Lender that it has obtained or will obtain the funds for any Loan in any particular place or manner. 
  
 2.11 Sharing of Payments. 
  
 If, other than as expressly provided elsewhere herein, any Lender shall
obtain on account of the Loans made by it any payment (whether voluntary, involuntary, through the exercise of any right of set-off, or otherwise) in excess of its ratable share (or other share contemplated hereunder) thereof, such Lender shall
immediately (a) notify the Administrative Agent of such fact, and (b) purchase from the other Lenders such participations in the Loans made by them held by them, as the case may be, as shall be necessary to cause such purchasing Lender to share the
excess payment in respect of such Loans or such participations, as the case may be, pro rata with each of them; provided that if all or any portion of such excess payment is thereafter recovered from the purchasing Lender, such purchase shall
to that extent be 
  

 23 

 rescinded and each other Lender shall repay to the purchasing Lender the purchase price paid therefor, together with an
amount equal to such paying Lender’s ratable share (according to the proportion of (i) the amount of such paying Lender’s required repayment to (ii) the total amount so recovered from the purchasing Lender) of any interest or other amount
paid or payable by the purchasing Lender in respect of the total amount so recovered. The Borrower agrees that any Lender so purchasing a participation from another Lender may, to the fullest extent permitted by law, exercise all its rights of
payment (including the right of set-off, but subject to Section 10.09 with respect to such participation as fully as if such Lender were the direct creditor of the Borrower in the amount of such participation. The Administrative Agent will
keep records (which shall be conclusive and binding in the absence of manifest error) of participations purchased under this Section and will in each case notify the Lenders following any such purchases or repayments. Each Lender that purchases a
participation pursuant to this Section shall from and after such purchase have the right to give all notices, requests, demands, directions and other communications under this Agreement with respect to the portion of the Obligations purchased to the
same extent as though the purchasing Lender were the original owner of the Obligations purchased. 
  
 2.12 Guaranty of Obligations. 
  
 The Obligations shall be jointly and severally guaranteed by the Guarantors pursuant to one or more Guaranties, the obligations under which shall be
secured pursuant to the terms and conditions of the Security Agreement (to which such Guarantor shall become a party). Promptly after the date on which any Person becomes a Material Domestic Subsidiary of the Borrower, and, in any event, within ten
(10) Business Days following receipt by the Borrower from the Administrative Agent of a request therefor, the Borrower will cause such Person to execute and deliver to the Administrative Agent, on behalf of the Lenders, a guaranty of the Obligations
in substantially the form of the Guaranty and an addendum by which such Person becomes a party to the Security Agreement. In addition, promptly after any date that the total revenues or total assets of all Subsidiaries organized under the laws of
the United States or any state or territory thereof that are at such time not Guarantors (each, a “Non-Guarantor Subsidiary”) together exceed ten percent (10.0%) of the total revenues or total assets, as the case may be, of the
Borrower and its Subsidiaries, determined on a consolidated basis, and in any event, within ten (10) Business Days following receipt by the Borrower from the Administrative Agent of a request therefor, the Borrower will cause one or more
Non-Guarantor Subsidiaries to execute and deliver to the Administrative Agent, on behalf of the Lenders, a guaranty of the Obligations in substantially the form of the Guaranty (and an addendum by which such Person becomes a party to the Security
Agreement), so that, after delivery of such guaranty or guarantees, the total revenues and total assets of all remaining Non-Guarantor Subsidiaries together are less than ten percent (10.0%) of the total revenues or total assets, as the case may be,
of the Borrower and its Subsidiaries, determined on a consolidated basis. In all of the foregoing instances, the Borrower shall deliver or cause to be delivered such other agreements, documents, instruments and other information and items as are
reasonably requested by the Administrative Agent, at the request of any Lender, in connection with the foregoing, including resolutions, incumbency and officers’ certificates and opinions of counsel. 
  
 ARTICLE III. 
 TAXES, YIELD PROTECTION AND ILLEGALITY 
  
 3.01 Taxes. 
  
 (a) Any and all payments by the Borrower to or for the account of the Administrative Agent or any Lender under any Loan Document shall be made free and
clear of and without deduction for any and all present or future taxes, duties, levies, imposts, deductions, assessments, fees, withholdings or similar charges, and all liabilities with respect thereto, excluding, in the case of the
Administrative Agent and each Lender, taxes imposed on or measured by its net income, and franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any political subdivision thereof) under the Laws of 
  

 24 

 which the Administrative Agent or such Lender, as the case may be, is organized or maintains a lending office (all such
non-excluded taxes, duties, levies, imposts, deductions, assessments, fees, withholdings or similar charges, and liabilities with respect thereto being hereinafter collectively referred to as “Taxes”). If the Borrower shall be
required by any Laws to deduct any Taxes from or in respect of any sum payable under any Loan Document to the Administrative Agent or any Lender, (i) the sum payable shall be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section), the Administrative Agent and such Lender receives an amount equal to the sum it would have received had no such deductions been made, (ii) the Borrower shall make such
deductions, (iii) the Borrower shall pay the full amount deducted to the relevant taxation authority or other authority in accordance with applicable Laws, and (iv) within thirty (30) days after the date of such payment, the Borrower shall furnish
to the Administrative Agent (which shall forward the same to such Lender) the original or a certified copy of a receipt evidencing payment thereof. 
  
 (b) In addition, the Borrower agrees to pay any and all present or future stamp, court or documentary taxes and any other excise or property taxes or
charges or similar levies which arise from any payment made under any Loan Document or from the execution, delivery, performance, enforcement or registration of, or otherwise with respect to, any Loan Document (hereinafter referred to as
“Other Taxes”). 
  
 (c) If the Borrower shall be
required to deduct or pay any Taxes or Other Taxes from or in respect of any sum payable under any Loan Document to the Administrative Agent or any Lender, the Borrower shall also pay to the Administrative Agent (for the account of such Lender) or
to such Lender, at the time interest is paid, such additional amount that such Lender specifies is necessary to preserve the after-tax yield (after factoring in all taxes, including taxes imposed on or measured by net income) such Lender would have
received if such Taxes or Other Taxes had not been imposed. 
  
 (d) The Borrower agrees to indemnify the Administrative Agent and each Lender for (i) the full amount of Taxes and Other Taxes (including any Taxes or Other Taxes imposed or asserted by any jurisdiction on amounts payable under this
Section) paid by the Administrative Agent and such Lender, (ii) amounts payable under Section 3.01(c) and (iii) any liability (including penalties, interest and expenses) arising therefrom or with respect thereto, in each case whether or not
such Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. Payment under this subsection (d) shall be made within thirty (30) days after the date the Lender or the Administrative Agent makes a
demand therefor. 
  
 3.02 Illegality. 
  
 If any Lender determines that any Law has made it unlawful, or that any
Governmental Authority has asserted that it is unlawful, for any Lender or its applicable Lending Office to make, maintain or fund Eurodollar Rate Loans, or to determine or charge interest rates based upon the Eurodollar Rate, then, on notice
thereof by such Lender to the Borrower through the Administrative Agent, any obligation of such Lender to make or continue Eurodollar Rate Loans or to convert Base Rate Loans to Eurodollar Rate Loans shall be suspended until such Lender notifies the
Administrative Agent and the Borrower that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, the Borrower shall, upon demand from such Lender (with a copy to the Administrative Agent), prepay or, if
applicable, convert all Eurodollar Rate Loans of such Lender to Base Rate Loans, either on the last day of the Interest Period thereof, if such Lender may lawfully continue to maintain such Eurodollar Rate Loans to such day, or immediately, if such
Lender may not lawfully continue to maintain such Eurodollar Rate Loans. Upon any such prepayment or conversion, the Borrower shall also pay accrued interest on the amount so prepaid or converted. Each Lender agrees to designate a different Lending
Office if such designation will avoid the need for such notice and will not, in the good faith judgment of such Lender, otherwise be materially disadvantageous to such Lender. If such notice is in fact given by a Lender, such 
  

 25 

 Lender agrees to use commercially reasonable good faith efforts to provide, without any liability for failing to provide
or failing to be able to provide, an alternate interest index rate upon which it can determine and charge interest (with any applicable margin) on extensions of credit that is substantially comparable to the Eurodollar Rate. 
  
 3.03 Inability to Determine Rates. 
  
 If the Administrative Agent determines in connection with any request for a
Eurodollar Rate Loan or a conversion to or continuation thereof that (a) Dollar deposits are not being offered to banks in the London interbank eurodollar market for the applicable amount and Interest Period of such Eurodollar Rate Loan, (b)
adequate and reasonable means do not exist for determining the Eurodollar Rate for such Eurodollar Rate Loan, or (c) the Eurodollar Rate for such Eurodollar Rate Loan does not adequately and fairly reflect the cost to the Lenders of funding such
Eurodollar Rate Loan, the Administrative Agent will promptly notify the Borrower and all Lenders. Thereafter, the obligation of the Lenders to make or maintain Eurodollar Rate Loans shall be suspended until the Administrative Agent revokes such
notice. Upon receipt of such notice, the Borrower may revoke any pending request for a Borrowing, conversion or continuation of Eurodollar Rate Loans or, failing that, will be deemed to have converted such request into a request for a Borrowing of
Base Rate Loans in the amount specified therein. 
  
 3.04
Increased Cost and Reduced Return; Capital Adequacy; Reserves on Eurodollar Rate Loans. 
  
 (a) If any Lender determines that as a result of the introduction of or any change in or in the interpretation of any Law, or such Lender’s compliance therewith, there shall be any increase in the cost to such
Lender of agreeing to make or making, funding or maintaining Eurodollar Rate Loans or (as the case may be) issuing or participating in Letters of Credit, or a reduction in the amount received or receivable by such Lender in connection with any of
the foregoing (excluding for purposes of this subsection (a) any such increased costs or reduction in amount resulting from (i) Taxes or Other Taxes (as to which Section 3.01 shall govern), (ii) changes in the basis of taxation of overall net
income or overall gross income by the United States or any foreign jurisdiction or any political subdivision of either thereof under the Laws of which such Lender is organized or has its Lending Office, and (iii) reserve requirements contemplated by
Section 3.04(c), then from time to time upon demand of such Lender (with a copy of such demand to the Administrative Agent), the Borrower shall pay to such Lender such additional amounts as will compensate such Lender for such increased cost
or reduction. 
  
 (b) If any Lender determines that the
introduction of any Law regarding capital adequacy or any change therein or in the interpretation thereof, or compliance by such Lender (or its Lending Office) therewith, has the effect of reducing the rate of return on the capital of such Lender or
any corporation controlling such Lender as a consequence of such Lender’s obligations hereunder (taking into consideration its policies with respect to capital adequacy and such Lender’s desired return on capital), then from time to time
upon demand of such Lender (with a copy of such demand to the Administrative Agent), the Borrower shall pay to such Lender such additional amounts as will compensate such Lender for such reduction. 
  
 (c) The Borrower shall pay to each Lender, as long as such Lender shall be
required to maintain reserves with respect to liabilities or assets consisting of or including Eurocurrency funds or deposits (currently known as “Eurocurrency liabilities”), additional interest on the unpaid principal amount of each
Eurodollar Rate Loan equal to the actual costs of such reserves allocated to such Loan by such Lender (as determined by such Lender in good faith, which determination shall be conclusive), which shall be due and payable on each date on which
interest is payable on such Loan, provided that the Borrower shall have received at least fifteen (15) days prior notice (with a copy to the Administrative Agent) of such additional interest from such Lender. If a Lender fails to give notice
fifteen (15) days prior to the relevant Interest Payment Date, such additional interest shall be due and payable fifteen (15) days from receipt of such notice. 
  

 26 

 3.05 Funding Losses. 
  
 Upon demand of any Lender (with a copy to the Administrative Agent) from time to time, the Borrower shall promptly
compensate such Lender for and hold such Lender harmless from any loss, cost or expense incurred by it as a result of: (a) any continuation, conversion, payment or prepayment of any Loan other than a Base Rate Loan on a day other than the last day
of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise); or (b) any failure by the Borrower (for a reason other than the failure of such Lender to make a Loan) to prepay, borrow,
continue or convert any Loan other than a Base Rate Loan on the date or in the amount notified by the Borrower; including, in each of the foregoing cases, any loss of anticipated profits and any loss or expense arising from the liquidation or
reemployment of funds obtained by it to maintain such Loan or from fees payable to terminate the deposits from which such funds were obtained. The Borrower shall also pay any customary administrative fees charged by such Lender in connection with
the foregoing. For purposes of calculating amounts payable by the Borrower to the Lenders under this Section 3.05, each Lender shall be deemed to have funded each Eurodollar Rate Loan made by it at the Eurodollar Rate for such Loan by a
matching deposit or other borrowing in the London interbank eurodollar market for a comparable amount and for a comparable period, whether or not such Eurodollar Rate Loan was in fact so funded. 
  
 3.06 Matters Applicable to all Requests for Compensation. 

 
 A certificate of the Administrative Agent or any Lender claiming
compensation under this Article III and setting forth the additional amount or amounts to be paid to it hereunder shall be conclusive in the absence of manifest error. In determining such amount, the Administrative Agent or such Lender may
use any reasonable averaging and attribution methods. 
  
 3.07
Survival. 
  
 All of the Borrower’s obligations under
this Article III shall survive termination of the Aggregate Commitments and repayment of all Obligations. 
  
 ARTICLE IV. 
 CONDITIONS 
  
 4.01 Conditions to Effectiveness and Initial Loans. 
  
 The effectiveness of this Agreement and the obligation of each Lender to
make its initial Loan hereunder are subject to satisfaction of the following conditions precedent: 
  
 (a) Unless waived by all the Lenders, the Administrative Agent’s receipt of the following, each of which shall be originals or facsimiles (followed
promptly by originals) unless otherwise specified, each properly executed by a Responsible Officer of the signing Loan Party, each dated the Closing Date (or, in the case of certificates of governmental officials, a recent date before the Closing
Date acceptable to the Administrative Agent) and each in form and substance satisfactory to the Administrative Agent, the Lenders and their respective legal counsel: 
  
 (i) executed counterparts of this Agreement, sufficient in number for distribution to the Administrative
Agent, the Collateral Agent, each Lender and the Borrower; 
  

 27 

 (ii) if requested by all Lenders, a Revolving Line of Credit Note and a Term Commitment
Note executed by the Borrower in favor of each Lender, such Notes to be in an original face amount equal to each such Lender’s Pro Rata Share of the Revolving Line of Credit Commitment Amount and the Term Commitment Amount, respectively;

  
 (iii) such certificates respecting
resolutions or other actions, incumbency certificates and/or other certificates of Responsible Officers of the Borrower as the Administrative Agent or any Lender may require to establish the identities of and verify the authority and capacity of
each Responsible Officer of the Borrower authorized to act as a Responsible Officer in connection with this letter agreement, the Credit Agreement and the other Loan Documents to which the Borrower is a party; 
  
 (iv) such evidence as the Administrative Agent and/or any
Lender may require to verify that the Borrower is duly organized or formed, validly existing, in good standing and qualified to engage in business in each jurisdiction in which it is required to be qualified to engage in business, including
certified copies of the Borrower’s Organization Documents, certificates of good standing and qualification to engage in business and tax clearance certificates; and 
  
 (v) such other assurances, certificates, documents, consents, approvals, materials or opinions as the
Administrative Agent, or any Lender reasonably may require. 
  
 (b) Any fees required to be paid on or before the Closing Date shall have been paid. 
  
 (c) Unless waived by the Administrative Agent, the Borrower shall have paid all reasonable Attorney Costs of the Administrative Agent, the Documentation Agent and the Collateral Agent to the extent invoiced prior to
or on the Closing Date, plus such additional amounts of reasonable Attorney Costs as shall constitute its reasonable estimate of such Attorney Costs incurred or to be incurred by it through the closing proceedings, provided that such estimate
shall not thereafter preclude a final settling of accounts between the Borrower and the Administrative Agent, the Documentation Agent and the Collateral Agent. 
  

Notwithstanding anything to the contrary contained in this Section 4.01, neither this Agreement nor any of the other Loan Documents shall become
effective or be binding on any party unless the preceding conditions have been satisfied (or waived, as appropriate), on or before 1:00 p.m., California time, on October 15, 2004. 
  
 4.02 Conditions to all Borrowings and Conversions and Continuations. 
  
 The obligation of each Lender to honor any Loan Notice, including the first
Loan Notice, is subject to the following conditions precedent: 
  
 (a) Unless waived by all the Lenders, the Administrative Agent’s receipt, on or before November 5, 2004, of the following, each of which shall be originals or facsimiles (followed promptly by originals) unless otherwise specified, each
properly executed by a Responsible Officer of the signing Loan Party, each dated the Closing Date or such other date as the Administrative Agent shall specify (or, in the case of certificates of governmental officials, a recent date before the
Closing Date acceptable to the Administrative Agent) and each in form and substance satisfactory to the Administrative Agent, the Lenders and their respective legal counsel: 
  
 (i) executed counterparts of the Guaranties and the Security Documents, sufficient in number for
distribution to the Administrative Agent, the Collateral Agent, each Lender and the Borrower; 
  

 28 

 (ii) such certificates respecting resolutions or other actions, incumbency certificates
and/or other certificates of Responsible Officers of each Loan Party as the Administrative Agent or any Lender may require to establish the identities of and verify the authority and capacity of each Responsible Officer thereof authorized to act as
a Responsible Officer in connection with this Agreement and the other Loan Documents to which such Loan Party is a party; 
  
 (iii) such evidence as the Administrative Agent and/or any Lender may require to verify that each Loan Party is duly organized or formed,
validly existing, in good standing and qualified to engage in business in each jurisdiction in which it is required to be qualified to engage in business, including certified copies of each Loan Party’s Organization Documents, certificates of
good standing and qualification to engage in business and tax clearance certificates; 
  
 (iv) a certificate signed by a Responsible Officer of the Borrower certifying (A) that the conditions specified in Sections 4.02(b)
and (c) have been satisfied, and (B) that there has been no event or circumstance since the date of the Audited Financial Statements which has or could be reasonably expected to have a Material Adverse Effect; and 
  
 (v) such other assurances, certificates, documents,
consents, approvals, materials or opinions as the Administrative Agent, or any Lender reasonably may require. 
  
 (b) The representations and warranties of the Borrower contained in Article V, or which are contained in any document furnished at any time under
or in connection herewith, shall be true and correct on and as of the date of such Borrowing, conversion or continuation, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall
be true and correct as of such earlier date. 
  
 (c) No Default or
Event of Default shall exist or would result from such Borrowing, conversion or continuation. 
  
 (d) The Administrative Agent shall have received a Loan Notice in accordance with the requirements hereof. 
  
 (e) The Administrative Agent shall have received, in form and substance satisfactory to it, such other assurances, certificates, documents or consents
related to the foregoing as the Administrative Agent or the Required Lenders reasonably may require. 
  
 Each Loan Notice submitted by the Borrower shall be deemed to be a representation and warranty that the conditions specified in Sections 4.02(b)
and (c) have been satisfied on and as of the date of the applicable Borrowing. 
  

 29 

 ARTICLE V. 
 REPRESENTATIONS AND WARRANTIES 
  
 The Borrower represents and warrants to the Administrative Agent and the Lenders that: 
  
 5.01 Existence, Qualification and Power; Compliance with Laws. 
  
 Each Loan Party (a) is a corporation, partnership or limited liability
company, duly organized or formed, validly existing and in good standing under the Laws of the jurisdiction of its incorporation or organization, (b) has all requisite power and authority and all governmental licenses, authorizations, consents and
approvals to own its assets, carry on its business and to execute, deliver, and perform its obligations under the Loan Documents to which it is a party, (c) is duly qualified and is licensed and in good standing under the Laws of each jurisdiction
where its ownership, lease or operation of properties or the conduct of its business requires such qualification or license, and (d) is in compliance with all Laws, except in each case referred to in subsections (c) or this subsection (d), to the
extent that failure to do so could not reasonably be expected to have a Material Adverse Effect. 
  
 5.02 Authorization; No Contravention. 
  
 The execution, delivery and performance by each Loan Party of each Loan Document to which such Person is party, have been duly authorized by all necessary
corporate or other organizational action, and do not and will not (a) contravene the terms of any of such Person’s Organization Documents; (b) conflict with or result in any breach or contravention of, or the creation of any Lien under, any
Contractual Obligation to which such Person is a party or any order, injunction, writ or decree of any Governmental Authority to which such Person or its property is subject; or (c) violate any Law. 
  
 5.03 Governmental Authorization. 
  
 No approval, consent, exemption, authorization, or other action by, or
notice to, or filing with, any Governmental Authority is necessary or required in connection with the execution, delivery or performance by, or enforcement against, any Loan Party of this Agreement or any other Loan Document. 
  
 5.04 Binding Effect. 
  
 This Agreement has been, and each other Loan Document, when delivered
hereunder, will have been, duly executed and delivered by each Loan Party that is party thereto. This Agreement constitutes, and each other Loan Document when so delivered will constitute, a legal, valid and binding obligation of such Loan Party,
enforceable against each Loan Party that is party thereto in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws generally affecting the rights of creditors, and subject to
equitable principles of general application. 
  
 5.05 Financial
Statements; No Material Adverse Effect. 
  
 (a) The Audited
Financial Statements (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; (ii) fairly present the financial condition of the Borrower and its Subsidiaries
as of the date thereof and their results of operations for the period covered thereby in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; and (iii) show all material
indebtedness and other liabilities, direct or contingent, of the Borrower and its consolidated Subsidiaries as of the date thereof, including liabilities for taxes, material commitments and Indebtedness. 
  
 (b) The unaudited consolidated financial statements of the Borrower and its
Subsidiaries, dated June 30, 2004, contained in the related quarterly report on Form 10-Q filed with the SEC (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted
therein, and subject to ordinary, good faith year end audit adjustments; (ii) 
  

 30 

 fairly present the financial condition of the Borrower and its Subsidiaries as of the date thereof and their results of
operations for the period covered thereby; and (iii) show all material indebtedness and other liabilities, direct or contingent, of the Borrower and its consolidated Subsidiaries as of the date thereof, including liabilities for taxes, material
commitments and Indebtedness. 
  
 (c) Since the date of the
Audited Financial Statements, there has been no event or circumstance that has had or could reasonably be expected to have a Material Adverse Effect. 
  
 5.06 Litigation. 
  
 Except as specifically disclosed on Schedule 5.06, there are no actions, suits, proceedings, claims or disputes pending or, to the knowledge of the
Borrower after due and diligent investigation, threatened or contemplated, at law, in equity, in arbitration or before any Governmental Authority, by or against the Borrower or any of its Subsidiaries or against any of their properties or revenues
that (a) purport to affect or pertain to this Agreement or any other Loan Document, or any of the transactions contemplated hereby, or (b) if determined adversely, could reasonably be expected to have a Material Adverse Effect. 
  
 5.07 No Default. 
  
 Neither the Borrower nor any Subsidiary is in default under or with respect
to any Contractual Obligation that could be reasonably expected to have a Material Adverse Effect. No Default or Event of Default has occurred and is continuing or would result from the consummation of the transactions contemplated by this Agreement
or any other Loan Document. 
  
 5.08 Ownership of Property;
Liens. 
  
 Each of the Borrower and its Subsidiaries has good
record and marketable title in fee simple to, or valid leasehold interests in, all real property necessary or used in the ordinary conduct of its business, except for such defects in title as could not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect. As of the Effective Date, the property of the Borrower and its Subsidiaries is not subject to any Lien, other than Liens permitted by Section 7.01. 
  
 5.09 Environmental Compliance. 
  
 (a) The on-going operations of the Borrower and each of its Subsidiaries,
after the Closing Date, comply in all respects with all Environmental Laws, except such non-compliance that could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. 
  
 (b) Except as specifically identified on Schedule 5.09, none of the
Borrower or any of its Subsidiaries or any of their present property or operations: (i) is subject to any outstanding written order from or agreement with any Governmental Authority or other Person; or (ii) to the best of the Borrower’s
knowledge, is subject to any judicial or docketed administrative proceeding respecting any Environmental Law, Environmental Claim or Hazardous Material. 
  
 (c) To the best of the Borrower’s knowledge, except as specifically identified on Schedule 5.09, there are no conditions or circumstances
relating to any property of the Borrower or its Subsidiaries, or arising from operations of the Borrower or its Subsidiaries conducted prior to the Closing Date that, together with all other such conditions and circumstances relating to all other
properties and operations, may give rise to Environmental Claims with a potential liability as to the Borrower and its Subsidiaries, either individually or in the aggregate, that could reasonably be expected to have a Material Adverse Effect.
Notwithstanding the foregoing, (i) neither the Borrower nor any of its Subsidiaries has any underground storage tanks (x) that are not properly registered or permitted under applicable 
  

 31 

 Environmental Laws or (y) that are leaking or disposing of Hazardous Materials off-site; (ii) the Borrower and its
Subsidiaries have notified all of their employees of the existence, if any, of any health hazard arising from the conditions of their employment and have met all notification requirements under all applicable Environmental Laws, and (iii) no
Hazardous Materials have been Released at, on or under any site, facility or vessel now or previously owned, operated or leased by the Borrower or any of its Subsidiaries that would have a Material Adverse Effect. 
  
 (d) To the best of the Borrower’s knowledge, except as specifically
identified on Schedule 5.09, the Borrower has not received any oral or written notification of a Release of a Hazardous Material, and no site, facility or vessel now or previously owned, operated or leased by the Borrower or any of its
Subsidiaries is listed or proposed for listing on any federal or state list of sites requiring investigation or clean-up. 
  
 5.10 Insurance. 
  
 The properties of the Borrower and its Subsidiaries are insured with financially sound and reputable insurance companies not Affiliates of the Borrower,
in such amounts, with such deductibles and covering such risks as are customarily carried by companies engaged in similar businesses and owning similar properties in localities where the Borrower or its Subsidiaries operate. 
  
 5.11 Taxes. 
  
 The Borrower and its Subsidiaries have filed all Federal, state and other
material tax returns and reports required to be filed, and have paid all Federal, state and other material taxes, assessments, fees and other governmental charges levied or imposed upon them or their properties, income or assets otherwise due and
payable, except those which are being contested in good faith by appropriate proceedings and for which adequate reserves have been provided in accordance with GAAP. There is no proposed tax assessment against the Borrower or any Subsidiary that
would, if made, have a Material Adverse Effect. 
  
 5.12 ERISA
Compliance. 
  
 (a) Each Plan is in compliance in all
material respects with the applicable provisions of ERISA, the Code and other Federal or state Laws. Each Plan that is intended to qualify under Section 401(a) of the Code has received a favorable determination letter from the IRS or an application
for such a letter is currently being processed by the IRS with respect thereto and, to the best knowledge of the Borrower, nothing has occurred which would prevent, or cause the loss of, such qualification. The Borrower and each ERISA Affiliate have
made all required contributions to each Plan subject to Section 412 of the Code, and no application for a funding waiver or an extension of any amortization period pursuant to Section 412 of the Code has been made with respect to any Plan.

  
 (b) There are no pending or, to the best knowledge of the
Borrower, threatened claims, actions or lawsuits, or action by any Governmental Authority, with respect to any Plan that could be reasonably be expected to have a Material Adverse Effect. There has been no prohibited transaction or violation of the
fiduciary responsibility rules with respect to any Plan that has resulted or could reasonably be expected to result in a Material Adverse Effect. 
  
 (c) (i) No ERISA Event has occurred or is reasonably expected to occur; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither the
Borrower nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability under Title IV of ERISA with respect to any Pension Plan (other than premiums due and not delinquent under Section 4007 of ERISA); (iv) neither the Borrower
nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability (and no event has occurred which, with the giving of notice under Section 4219 of ERISA, would result in such liability) 
  

 32 

 under Sections 4201 or 4243 of ERISA with respect to a Multiemployer Plan; and (v) neither the Borrower nor any ERISA
Affiliate has engaged in a transaction that could be subject to Sections 4069 or 4212(c) of ERISA. 
  
 5.13 Subsidiaries. 
  
 As of the Closing Date, the Borrower has no Subsidiaries other than those specifically disclosed in Part (a) of Schedule 5.13 and those of whom the
Borrower has notified the Administrative Agent in writing following the Closing Date pursuant to Section 2.12 and has no equity investments in any other Person other than those specifically disclosed in Part (b) of Schedule 5.13.

  
 5.14 Margin Regulations; Investment Company Act; Public
Utility Holding Company Act. 
  
 The Borrower is not engaged
and will not engage, principally or as one of its important activities, in the business of purchasing or carrying margin stock (within the meaning of Regulation U issued by the FRB), or extending credit for the purpose of purchasing or carrying
margin stock. None of the Borrower, any Person controlling the Borrower, or any Subsidiary (a) is a “holding company,” or a “subsidiary company” of a “holding company,” or an “affiliate” of a “holding
company” or of a “subsidiary company” of a “holding company,” within the meaning of the Public Utility Holding Company Act of 1935, or (b) is or is required to be registered as an “investment company” under the
Investment Company Act of 1940, the Federal Power Act, the Interstate Commerce Act, any state public utilities code or any other federal or state statute or regulation limiting its ability to incur Indebtedness. 
  
 5.15 Disclosure. 
  
 The documents, certificates and written statements (including the Loan
Documents) furnished to the Administrative Agent and the Lenders by the Borrower or any Subsidiary for use in connection with the transactions contemplated by this Agreement, taken as a whole, do not contain any untrue statement of a material fact
or omit to state a material fact (known to the Borrower in the case of any document not furnished by it) necessary in order to make the statements contained herein or therein not misleading (it being recognized by the Administrative Agent and the
Lenders that projections and forecasts provided to them by the Borrower are not to be viewed as facts and that actual results during the period or periods covered by any such projections and forecasts may differ from the projected or forecasted
results). 
  
 5.16 Intellectual Property; Licenses, Etc.

  
 The Borrower and its Subsidiaries own, or possess the
right to use, all of the trademarks, service marks, trade names, copyrights, patents, patent rights, franchises, licenses and other intellectual property rights (collectively, “IP Rights”) that are reasonably necessary for the
operation of their respective businesses, without conflict with the rights of any other Person. To the best knowledge of the Borrower, no slogan or other advertising device, product, process, method, substance, part or other material employed or
contemplated to be employed by the Borrower or any Subsidiary infringes upon any rights held by any other Person. Except as specifically disclosed in Schedule 5.16, no claim or litigation regarding any of the foregoing is pending or, to the
best knowledge of the Borrower, threatened, and no patent, invention, device, application, principle or any statute, law, rule, regulation, standard or code is pending or, to the knowledge of the Borrower, proposed, which, in either case, could
reasonably be expected to have a Material Adverse Effect. 
  

 33 

 5.17 Swap Contracts. 
  
 The Borrower and its Subsidiaries have each voluntarily entered into each Swap Contract to which it is a party based upon
its own independent assessment of its consolidated assets, liabilities and commitments in each case as an appropriate means of mitigating and managing risks associated with such matters. 
  
 5.18 Labor Relations. 
  
 There are no strikes, lockouts or other labor disputes against the Borrower or any of its Subsidiaries, or, to the best of the Borrower’s knowledge,
threatened against or affecting the Borrower or any of its Subsidiaries, and no significant unfair labor practice complaint is pending against the Borrower or any of its Subsidiaries or, to the best knowledge of the Borrower, threatened against any
of them before any Governmental Authority, which could reasonably be expected to result in a Material Adverse Effect. 
  
 5.19 Use of Proceeds. 
  
 The Borrower shall use the proceeds of the Loans solely for (a) in the case of Revolving Line of Credit Loans, working capital and other general corporate
purposes (including stock repurchases and Acquisitions not prohibited hereunder) and (b) in the case of Term Commitment Loans, solely to consummate the Specified Acquisition; provided that in no event may the Borrower use the proceeds of any
Loan in contravention of the provisions of any Loan Document or any Law. 
  
 5.20 Solvency. 
  
 The
Borrower is and shall continue to be, and shall cause each of its Subsidiaries to be, Solvent. 
  
 5.21 Tax Shelter Regulations. 
  
 The Borrower does not intend to treat the Loans and related transactions as being a “reportable transaction” (within the meaning of Treasury Regulation section 1.6011-4). If the Borrower determines to take any action inconsistent
with such intention, it will promptly notify the Administrative Agent thereof. The Borrower acknowledges that the Administrative Agent or one or more of the Lenders may treat the Loans as part of a transaction that is subject to Treasury Regulation
section 1.6011-4 or section 301.6112–1 (or any successor sections), and the Administrative Agent and such Lender or Lenders, as applicable, may file such Internal Revenue Service forms or maintain such lists and other records as they may
determined is required by such Treasury Regulations. 
  
 ARTICLE
VI. 
 AFFIRMATIVE COVENANTS 
  
 So long as any Lender shall have any Commitment hereunder or any Loan or other Obligation shall remain unpaid or
unsatisfied, the Borrower shall, and shall (except in the case of the covenants set forth in Sections 6.01, 6.02, 6.03 and 6.11) cause each Subsidiary to: 
  
 [*] 
  
 [*] Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions. 
  

 34 

 ARTICLE VII. 
 NEGATIVE COVENANTS 
  
 So long as any Lender shall have any Commitment hereunder or any Loan or other Obligation shall remain unpaid or unsatisfied, the Borrower shall not, nor shall it permit any Subsidiary to, directly or indirectly:

  
 [*] 
  
 ARTICLE VIII. 
 EVENTS OF DEFAULT AND REMEDIES 
  
 8.01 Events of Default. 
  
 Any of the following shall constitute an “Event of Default”: 
  
 (a) Non-Payment. The Borrower fails to pay (i) when and as required to be paid herein, any amount of principal of any
Loan, or (ii) within three (3) Business Days after the same becomes due, any interest on any Loan or on any commitment, utilization or other fee due hereunder, or any other amount payable hereunder or under any other Loan Document; or 
  
 (b) Specific Covenants. (i) The Borrower fails to perform or observe
any term, covenant or agreement contained in any of Section 6.01, 6.02, 6.03, 6.05, 6.10, 6.12 or 6.13 or Article VII; or (ii) the Borrower’s pro forma financial projections
delivered pursuant to Section 6.02(e)(ii) do not demonstrate to the satisfaction of the Administrative Agent and the Required Lenders that the Borrower will remain in compliance with Section 7.13 from December 31, 2005 through to and
including December 31, 2006 after the making of all payments referred in clause (i) of Section 6.02(e); 
  
 (c) Other Defaults. Any Loan Party fails to perform or observe any other covenant or agreement (not specified in subsection (a) or (b) above)
contained in any Loan Document on its part to be performed or observed and such failure continues for thirty (30) days; or 
  
 (d) Representations and Warranties. Any representation or warranty made or deemed made by the Borrower or any other Loan Party herein, in any other
Loan Document, or in any document delivered in connection herewith or therewith proves to have been incorrect in any material respect when made or deemed made; or 
  
 (e) Cross-Default. (i) The Borrower or any Material Subsidiary or any Guarantor (A) fails to make any payment when
due (whether by scheduled maturity, required prepayment, acceleration, demand, or otherwise) in respect of any Indebtedness or Guaranty Obligation (other than Indebtedness hereunder and Indebtedness under Swap Contracts) having an aggregate
principal amount (including undrawn committed or available amounts and including amounts owing to all creditors under any combined or syndicated credit arrangement) of more than Five Hundred Thousand Dollars ($500,000.00), or (B) fails to observe or
perform any other agreement or condition relating to any such Indebtedness or Guaranty Obligation or contained in any instrument or agreement evidencing, securing or relating thereto, or any other event occurs, the effect of which default or other
event is to cause, or to permit the holder or 
  
 [*] Certain
information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. 
  

 35 

 holders of such Indebtedness or the beneficiary or beneficiaries of such Guaranty Obligation (or a trustee or agent on
behalf of such holder or holders or beneficiary or beneficiaries) to cause, with the giving of notice if required, such Indebtedness to be demanded or to become due or to be repurchased or redeemed (automatically or otherwise) prior to its stated
maturity, or such Guaranty Obligation to become payable or cash collateral in respect thereof to be demanded; or (ii) there occurs under any Swap Contract an Early Termination Date (as defined in such Swap Contract) resulting from (A) any event of
default under such Swap Contract as to which the Borrower or any Material Subsidiary or any Guarantor is the Defaulting Party (as defined in such Swap Contract) or (B) any Termination Event (as so defined) under such Swap Contract as to which the
Borrower or any Material Subsidiary is an Affected Party (as so defined) and, in either event, the Swap Termination Value owed by the Borrower or such Material Subsidiary as a result thereof is greater than Five Hundred Thousand Dollars
($500,000.00); or 
  
 (f) Insolvency Proceedings, Etc. Any
Loan Party or any of its Subsidiaries institutes or consents to the institution of any proceeding under any Debtor Relief Law, or makes an assignment for the benefit of creditors; or applies for or consents to the appointment of any receiver,
trustee, custodian, conservator, liquidator, rehabilitator or similar officer for it or for all or any material part of its property; or any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer is appointed without
the application or consent of such Person and the appointment continues undischarged or unstayed for sixty (60) calendar days; or any proceeding under any Debtor Relief Law relating to any such Person or to all or any part of its property is
instituted without the consent of such Person and continues undismissed or unstayed for sixty (60) calendar days, or an order for relief is entered in any such proceeding; or 
  
 (g) Inability to Pay Debts; Attachment. (i) Any Loan Party or any of its Subsidiaries becomes unable or admits in
writing its inability or fails generally to pay its debts as they become due, or (ii) any writ or warrant of attachment or execution or similar process is issued or levied against all or any material part of the property of any such Person and is
not released, vacated or fully bonded within thirty (30) days after its issue or levy; or 
  
 (h) Judgments. There is entered against any Loan Party or any Subsidiary (i) a final judgment or order for the payment of money in an aggregate amount exceeding One Million Dollars ($1,000,000.00) (to the
extent not covered by independent third-party insurance as to which the insurer does not dispute coverage), or (ii) any non-monetary final judgment that has, or could reasonably be expected to have, a Material Adverse Effect and, in either case, (A)
enforcement proceedings are commenced by any creditor upon such judgment or order, or (B) there is a period of ten (10) consecutive days during which a stay of enforcement of such judgment, by reason of a pending appeal or otherwise, is not in
effect; or 
  
 (i) ERISA. (i) An ERISA Event occurs with
respect to a Pension Plan or Multiemployer Plan which has resulted or could reasonably be expected to result in liability of the Borrower under Title IV of ERISA to the Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in excess of
One Million Dollars ($1,000,000.00), or (ii) the Borrower or any ERISA Affiliate fails to pay when due, after the expiration of any applicable grace period, any installment payment with respect to its withdrawal liability under Section 4201 of ERISA
under a Multiemployer Plan in an aggregate amount in excess of the One Million Dollars ($1,000,000.00); or 
  
 (j) Invalidity of Loan Documents. Any Loan Document, at any time after its execution and delivery and for any reason other than the agreement of
all the Lenders or satisfaction in full of all the Obligations, ceases to be in full force and effect, or is declared by a court of competent jurisdiction to be null and void, invalid or unenforceable in any respect; or any Loan Party denies that it
has any or further liability or obligation under any Loan Document, or purports to revoke, terminate or rescind any Loan Document; or 
  

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 (k) Loss of Material Licenses, Permits or Intellectual Property. Any Governmental Authority
revokes or fails to renew any material license, permit or franchise of the Borrower or any of its Subsidiaries, or the Borrower or any of its Subsidiaries for any reason loses any material license, permit or franchise, or the Borrower or any of its
Subsidiaries suffers the imposition of any restraining order, escrow, suspension or impound of funds in connection with any proceeding (judicial or administrative) with respect to any material license, permit or franchise that could reasonably be
expected to have a Material Adverse Effect; or 
  
 (l) Change
of Control. There occurs any Change of Control; or 
  
 (m)
Material Adverse Effect. There occurs any event or circumstance that has a Material Adverse Effect. 
  
 8.02 Remedies Upon Event of Default. 
  
 If any Event of Default occurs: 
  
 (a) the Administrative Agent shall, at the request of, or may, with the consent of, the Required Lenders, declare the Commitment of each Lender to make
Loans to be terminated, whereupon such Commitments and obligation shall be terminated; 
  
 (b) the Administrative Agent shall, at the request of, or may, with the consent of, the Required Lenders, declare the then Outstanding Amount of all Loans, all interest accrued and unpaid thereon, and all other
amounts owing or payable hereunder or under any other Loan Document to be immediately due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by the Borrower; and 
  
 (c) the Administrative Agent or the Collateral Agent shall, at the request
of, or may, with the consent of, the Required Lenders, exercise on behalf of itself and the Lenders all rights and remedies available to it and the Lenders under the Loan Documents or applicable law; 
  
 provided that, upon the occurrence of any event specified in subsection (f) of
Section 8.01, the Commitments and all other obligations of each Lender to make Loans shall automatically terminate, the then Outstanding Amount of all Loans and all interest and other amounts as aforesaid shall automatically become due and
payable and all payment obligations under the Guaranty of each Guarantor shall automatically become due and payable, in each case without further act of the Administrative Agent, the Collateral Agent or any Lender. 
  
 8.03 Application of Funds. 
  
 After any exercise of remedies provided for in Section 8.02 (or after
the Loans have automatically become immediately due and payable as set forth in the proviso to Section 8.02), any amounts received on account of the Obligations shall be applied by the Administrative Agent in the following order: 

 
 (a) first, to payment of that portion of the Obligations
constituting fees, indemnities, expenses and other amounts (including Attorney Costs and amounts payable under Article III) payable to the Administrative Agent in its capacity as such; 
  
 (b) second, to payment of that portion of the Obligations constituting
fees, indemnities and other amounts (other than principal and interest) payable to the Lenders (including Attorney Costs and amounts payable under Article III), ratably among them in proportion to the amounts described in this subsection (b)
payable to them; 
  

 37 

 (c) third, to payment of that portion of the Obligations constituting accrued and unpaid interest
on the Loans, ratably among the Lenders in proportion to the respective amounts described in this subsection (c) payable to them; 
  
 (d) fourth, to payment of that portion of the Obligations constituting unpaid principal of the Loans, ratably among the Lenders in proportion to
the respective amounts described in this subsection (d) held by them; and 
  
 (e) last, the balance, if any, after all of the Obligations have been indefeasibly paid in full, to the Borrower or as otherwise required by Law. 
  
 ARTICLE IX. 
 ADMINISTRATIVE AGENT AND COLLATERAL AGENT 
  
 9.01 Appointment and Authorization of Administrative Agent and Collateral Agent. 
  
 Each Lender hereby irrevocably appoints, designates and authorizes the Administrative Agent and the Collateral Agent to take
such action on its behalf under the provisions of this Agreement and each other Loan Document and to exercise such powers and perform such duties as are expressly delegated to it by the terms of this Agreement or any other Loan Document, together
with such powers as are reasonably incidental thereto. Notwithstanding any provision to the contrary contained elsewhere herein or in any other Loan Document, neither the Administrative Agent nor the Collateral Agent shall have any duties or
responsibilities, except those expressly set forth herein or in any other Loan Document, nor shall either the Administrative Agent or the Collateral Agent have or be deemed to have any fiduciary relationship with any Lender or participant, and no
implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against the Administrative Agent or the Collateral Agent. Without limiting the
generality of the foregoing sentence, the use of the term “agent” herein and in the other Loan Documents with reference to either the Administrative Agent or the Collateral Agent is not intended to connote any fiduciary or other implied
(or express) obligations arising under agency doctrine of any applicable law. Instead, such term is used merely as a matter of market custom, and is intended to create or reflect only an administrative relationship between independent contracting
parties. 
  
 9.02 Delegation of Duties. 
  
 The Administrative Agent and the Collateral Agent may execute any of their
respective duties under this Agreement or any other Loan Document by or through agents, employees or attorneys-in-fact and shall be entitled to advice of counsel and other consultants or experts concerning all matters pertaining to such duties.
Neither the Administrative Agent nor the Collateral Agent shall be responsible for the negligence or misconduct of any agent or attorney-in-fact that it selects in the absence of gross negligence or willful misconduct. 
  
 9.03 Liability of Administrative Agent. 
  
 No Agent-Related Person shall (a) be liable for any action taken or omitted
to be taken by any of them under or in connection with this Agreement or any other Loan Document or the transactions contemplated hereby (except for its own gross negligence or willful misconduct in connection with its duties expressly set forth
herein), or (b) be responsible in any manner to any Lender or participant for any recital, statement, representation or warranty made by any Loan Party or any officer thereof, contained 
  

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 herein or in any other Loan Document, or in any certificate, report, statement or other document referred to or provided
for in, or received by any Agent-Related Person under or in connection with, this Agreement or any other Loan Document, or the validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Loan Document, or for
any failure of any Loan Party or any other party to any Loan Document to perform its obligations hereunder or thereunder. No Agent-Related Person shall be under any obligation to any Lender or participant to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions of, this Agreement or any other Loan Document, or to inspect the properties, books or records of any Loan Party or any Affiliate thereof. 
  
 9.04 Reliance by Administrative Agent and Collateral Agent.

  
 (a) Each of the Administrative Agent and the Collateral
Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, communication, signature, resolution, representation, notice, consent, certificate, affidavit, letter, telegram, facsimile, telex or telephone message,
statement or other document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons, and upon advice and statements of legal counsel (including counsel to any Loan Party),
independent accountants and other experts selected by the Administrative Agent or the Collateral Agent. Each of the Administrative Agent and the Collateral Agent shall be fully justified in failing or refusing to take any action under any Loan
Document unless it shall first receive such advice or concurrence of the Required Lenders as it deems appropriate and, if it so requests, it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense
which may be incurred by it by reason of taking or continuing to take any such action. Each of the Administrative Agent and the Collateral Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement or
any other Loan Document in accordance with a request or consent of the Required Lenders or all the Lenders, if required hereunder, and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders and
participants. Where this Agreement or any other Loan Document expressly permits or prohibits an action unless the Required Lenders otherwise determine, each of the Administrative Agent and the Collateral Agent shall, and in all other instances, the
Administrative Agent or the Collateral Agent (as applicable) may, but shall not be required to, initiate any solicitation for the consent or a vote of the Lenders. 
  
 (b) For purposes of determining compliance with the conditions specified in Section 4.01, each Lender that has signed
this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter either sent by the Administrative Agent or the Collateral Agent to such Lender for consent, approval, acceptance or
satisfaction, or required thereunder to be consented to or approved by or acceptable or satisfactory to a Lender. 
  
 9.05 Notice of Default. 
  
 Neither the Administrative Agent nor the Collateral Agent shall be deemed to have knowledge or notice of the occurrence of any Default or Event of
Default, except, solely in the case of the Administrative Agent, with respect to defaults in the payment of principal, interest and fees required to be paid to the Administrative Agent for the account of the Lenders, unless the Administrative Agent
or the Collateral Agent shall have received written notice from a Lender or the Borrower referring to this Agreement, describing such Default or Event of Default and stating that such notice is a “notice of default.” The Administrative
Agent (and not the Collateral Agent) will notify the Lenders of its receipt of any such notice. Each of the Administrative Agent and the Collateral Agent shall take such action with respect to such Default or Event of Default as may be directed by
the Required Lenders in accordance with Article VIII; provided that unless and until the Administrative Agent or the Collateral Agent (as applicable) has received any such direction, the Administrative Agent or the Collateral Agent (as
applicable) may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable or in the best interest of the Lenders. 
  

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 9.06 Credit Decision; Disclosure of Information by Agent-Related Persons. 
  
 Each Lender acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act by any Agent-Related Person hereafter taken, including any consent to and acceptance of any assignment or review of the affairs of any Loan Party or any Affiliate thereof, shall be deemed to
constitute any representation or warranty by any Agent-Related Person to any Lender as to any matter, including whether Agent-Related Persons have disclosed material information in their possession. Each Lender represents to the Administrative Agent
that it has, independently and without reliance upon any Agent-Related Person and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, prospects, operations, property,
financial and other condition and creditworthiness of the Loan Parties and their respective Subsidiaries, and all applicable bank or other regulatory Laws relating to the transactions contemplated hereby, and made its own decision to enter into this
Agreement and to extend credit to the Borrower and the other Loan Parties hereunder. Each Lender also represents that it will, independently and without reliance upon any Agent-Related Person and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents, and to make such investigations as it deems necessary to inform itself
as to the business, prospects, operations, property, financial and other condition and creditworthiness of the Borrower and the other Loan Parties. Except for notices, reports and other documents expressly required to be furnished to the Lenders by
the Administrative Agent herein, neither the Administrative Agent nor the Collateral Agent shall have any duty or responsibility to provide any Lender with any credit or other information concerning the business, prospects, operations, property,
financial and other condition or creditworthiness of any of the Loan Parties or any of their respective Affiliates which may come into the possession of any Agent-Related Person. 
  
 9.07 Indemnification of Agent-Related Persons. 
  
 Whether or not the transactions contemplated hereby are consummated, the Lenders shall indemnify upon demand each
Agent-Related Person (to the extent not reimbursed by or on behalf of any Loan Party and without limiting the obligation of any Loan Party to do so), pro rata, and hold harmless each Agent-Related Person from and against any and all Indemnified
Liabilities incurred by it; provided that no Lender shall be liable for the payment to any Agent-Related Person of any portion of such Indemnified Liabilities determined in a final, nonappealable judgment by a court of competent jurisdiction
to have been caused primarily by such Person’s own gross negligence or willful misconduct; provided that no action taken in accordance with the directions of the Required Lenders shall be deemed to constitute gross negligence or willful
misconduct for purposes of this Section. Without limitation of the foregoing, each Lender shall reimburse each of the Administrative Agent and the Collateral Agent upon demand for its ratable share of any costs or out-of-pocket expenses (including
reasonable Attorney Costs and costs and expenses in connection with the use of the Internet or any other information transmission systems in connection with this Agreement) incurred by the Administrative Agent or the Collateral Agent in connection
with the preparation, execution, delivery, administration, modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or responsibilities under, this Agreement, any
other Loan Document, or any document contemplated by or referred to herein, to the extent that the Administrative Agent or the Collateral Agent is not reimbursed for such expenses by or on behalf of the Borrower. The undertaking in this Section
shall survive termination of the Aggregate Commitments, the payment of all Obligations hereunder and the resignation or replacement of the Administrative Agent or the Collateral Agent. 
  

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 9.08 Administrative Agent and Collateral Agent in Their Individual Capacities. 
  
 Each of Bank of America, Wells Fargo and their respective Affiliates may
make loans to, issue letters of credit for the account of, accept deposits from, acquire equity interests in and generally engage in any kind of banking, trust, financial advisory, underwriting or other business with each of the Loan Parties and
their respective Affiliates as though Bank of America were not the Administrative Agent hereunder and as though Wells Fargo were not the Collateral Agent hereunder and, in any event, without notice to or consent of the Lenders. The Lenders
acknowledge that, pursuant to such activities, each of Bank of America, Wells Fargo or any of their respective Affiliates may receive information regarding any Loan Party or its Affiliates (including information that may be subject to
confidentiality obligations in favor of such Loan Party or such Affiliate) and acknowledge that neither the Administrative Agent nor the Collateral Agent shall be under any obligation to provide such information to them. With respect to its Loans,
each of Bank of America and Wells Fargo shall have the same rights and powers under this Agreement as any other Lender and may exercise such rights and powers as though, in the case of Bank of America, it were not the Administrative Agent, and as
though, in the case of Wells Fargo, it were not the Collateral Agent, and the terms “Lender” and “Lenders” include each of Bank of America and Wells Fargo in its individual capacity. 
  
 9.09 Successor Administrative Agent. 
  
 The Administrative Agent may resign as Administrative Agent upon thirty (30)
days prior notice to the Lenders. If the Administrative Agent resigns under this Agreement, the Required Lenders shall appoint from among the Lenders a successor administrative agent for the Lenders which successor administrative agent shall be
consented to by the Borrower at all times other than during the existence of an Event of Default (which consent of the Borrower shall not be unreasonably withheld or delayed). If no successor administrative agent is appointed prior to the effective
date of the resignation of the Administrative Agent, then the Administrative Agent may appoint, after consulting with the Lenders and the Borrower, a successor administrative agent from among the Lenders. Upon the acceptance of its appointment as
successor administrative agent hereunder, the Person acting as such successor administrative agent shall succeed to all the rights, powers and duties of the retiring Administrative Agent and the term “Administrative Agent” shall
mean such successor administrative agent, and the retiring Administrative Agent’s appointment, powers and duties as Administrative Agent shall be terminated, without any other or further act or deed on the part of any other Lender. After any
retiring Administrative Agent’s resignation hereunder as Administrative Agent, the provisions of this Article IX and Section 10.04 and Section 10.05 shall inure to such Person’s benefit as to any actions taken or
omitted to be taken by it while it was Administrative Agent under this Agreement. If no successor administrative agent has accepted appointment as Administrative Agent by the date which is thirty (30) days following a retiring Administrative
Agent’s notice of resignation, the retiring Administrative Agent’s resignation shall nevertheless thereupon become effective and the Lenders shall perform all of the duties of the Administrative Agent hereunder until such time, if any, as
the Required Lenders appoint a successor agent as provided for above. 
  
 9.10 Successor Collateral Agent. 
  
 The
Collateral Agent may resign as Collateral Agent upon thirty (30) days prior notice to the Lenders. If the Collateral Agent resigns under this Agreement, the Required Lenders shall appoint from among the Lenders a successor collateral agent for the
Lenders which successor collateral agent shall be consented to by the Borrower at all times other than during the existence of an Event of Default (which consent of the Borrower shall not be unreasonably withheld or delayed). If no successor
collateral agent is appointed prior to the effective date of the resignation of the Collateral Agent, then the Collateral Agent may appoint, after consulting with the Lenders and the Borrower, a successor collateral agent from among the Lenders.
Upon the acceptance of its appointment as successor collateral agent hereunder, the Person acting as such successor collateral agent shall succeed to all the rights, powers and duties of the retiring 
  

 41 

 Collateral Agent and the term “Collateral Agent” shall mean such successor collateral agent, and the
retiring Collateral Agent’s appointment, powers and duties as Collateral Agent shall be terminated, without any other or further act or deed on the part of any other Lender. After any retiring Collateral Agent’s resignation hereunder as
Collateral Agent, the provisions of this Article IX and Sections 10.03 and 10.13 shall inure to such Person’s benefit as to any actions taken or omitted to be taken by it while it was Collateral Agent under this Agreement.
If no successor collateral agent has accepted appointment as Collateral Agent by the date which is thirty (30) days following a retiring Collateral Agent’s notice of resignation, the retiring Collateral Agent’s resignation shall
nevertheless thereupon become effective and the Lenders shall perform all of the duties of the Collateral Agent hereunder until such time, if any, as the Required Lenders appoint a successor agent as provided for above. 
  
 9.11 Administrative Agent May File Proofs of Claim. 
  
 In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan shall then be due and payable as herein expressed
or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled and empowered, by intervention in such proceeding or otherwise: 
  
 (a) to file and prove a claim for the whole amount of the principal and
interest owing and unpaid in respect of the Loans, and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders and the Administrative Agent
(including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders and the Administrative Agent and their respective agents and counsel and all other amounts due the Lenders and the Administrative Agent under
Article II and Section 10.04 allowed in such judicial proceedings; and 
  
 (b) to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same; 
  
 and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender to
make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the Lenders, to pay to the Administrative Agent any amount due for the reasonable compensation,
expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Article II and Section 10.04. 
  
 Nothing contained herein shall be deemed to authorize the Administrative
Agent to authorize or consent to or accept or adopt on behalf of any Lender any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or to authorize the Administrative Agent to vote in
respect of the claim of any Lender in any such proceeding. 
  
 9.12 Guaranty Matters. 
  
 Each Lender hereby
irrevocably authorizes the Administrative Agent, at its option and in its discretion, to release any Guarantor from its obligations under a Guaranty if such Person ceases to be a Subsidiary as a result of a transaction permitted hereunder. Upon
request by the Administrative Agent at any time, each Lender will confirm in writing the Administrative Agent’s authority to release any Guarantor from its obligations under a Guaranty pursuant to this Section 9.12. 
  

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 9.13 Collateral Matters. 
  
 (a) Each Lender hereby irrevocably authorizes and directs the Collateral Agent to enter into the Security Documents for the
benefit of such Lender. Each Lender hereby agrees, and each holder of any Note by the acceptance thereof will be deemed to agree, that, except as otherwise set forth in Section 10.01, any action taken by the Required Lenders, in accordance
with the provisions of this Agreement or the Security Documents, and the exercise by the Required Lenders of the powers set forth herein or therein, together with such other powers as are reasonably incidental thereto, shall be authorized and
binding upon all of Lenders. The Collateral Agent is hereby authorized on behalf of all of Lenders, without the necessity of any notice to or further consent from any Lender from time to time prior to, an Event of Default, to take any action with
respect to any Collateral or Collateral Documents which may be necessary to perfect and maintain perfected the Liens upon the Collateral granted pursuant to the Security Documents. 
  
 (b) Each Lender hereby irrevocably authorizes the Collateral Agent, at its option and in its discretion, 
  
 (i) to release any Lien on any property granted to or held by the Collateral
Agent under any Loan Document (i) upon termination of the Aggregate Commitments and payment in full of all Obligations (other than contingent indemnification obligations), (ii) that is sold or to be sold as part of or in connection with any sale
permitted hereunder or under any other Loan Document, (iii) subject to Section 10.01, if approved, authorized or ratified in writing by the Required Lenders, or (iv) in connection with any foreclosure sale or other disposition of Collateral
after the occurrence of an Event of Default; and 
  
 (ii) to
subordinate any Lien on any property granted to or held by the Collateral Agent under any Loan Document to the holder of any Lien on such property that is permitted by this Agreement or any other Loan Document. 
  
 Upon request by the Collateral Agent at any time, each Lender will confirm in
writing the Collateral Agent’s authority to release or subordinate its interest in particular types or items of Collateral pursuant to this Section 9.13. 
  
 (c) Subject to Section 9.13(b), the Collateral Agent shall (and is hereby irrevocably authorized by each Lender, to)
execute such documents as may be necessary to evidence the release or subordination of the Liens granted to the Collateral Agent for the benefit of the Collateral Agent and Lenders herein or pursuant hereto upon the applicable Collateral;
provided that (i) the Collateral Agent shall not be required to execute any such document on terms which, in the Collateral Agent’s opinion, would expose the Collateral Agent to or create any liability or entail any consequence other
than the release or subordination of such Liens without recourse or warranty and (ii) such release or subordination shall not in any manner discharge, affect or impair the Obligations or any Liens upon (or obligations of the Borrower or any other
Loan Party in respect of) all interests retained by the Borrower or any other Loan Party, including the proceeds of the sale, all of which shall continue to constitute part of the Collateral. In the event of any sale or transfer of Collateral, or
any foreclosure with respect to any of the Collateral, the Collateral Agent shall be authorized to deduct all expenses reasonably incurred by the Collateral Agent from the proceeds of any such sale, transfer or foreclosure. 
  
 (d) The Collateral Agent shall have no obligation whatsoever to any Lender or
any other Person to assure that the Collateral exists or is owned by Borrower or any other Loan Party or is cared for, protected or insured or that the Liens granted to the Collateral Agent herein or in any of the Collateral Documents or pursuant
hereto or thereto have been properly or sufficiently or lawfully created, perfected, 
  

 43 

 protected or enforced or are entitled to any particular priority, or to exercise or to continue exercising at all or in
any manner or under any duty of care, disclosure or fidelity any of the rights, authorities and powers granted or available to the Collateral Agent in this Section 9.13 or in any of the Security Documents, it being understood and agreed that
in respect of the Collateral, or any act, omission or event related thereto, the Collateral Agent may act in any manner it may deem appropriate, in its sole discretion, given the Collateral Agent’s own interest in the Collateral as one of
Lenders. 
  
 (e) Each Lender hereby appoints each other Lender as
agent for the purpose of perfecting the Collateral Agent’s or the Lenders’ security interest in assets that, in accordance with Article 9 or Division 9 (as applicable) of the applicable Uniform Commercial Code, can be perfected only by
possession. Should any Lender (other than the Collateral Agent) obtain possession of any such Collateral, such Lender shall notify the Collateral Agent thereof, and, promptly upon the Collateral Agent’s request therefore, shall deliver such
Collateral to the Collateral Agent or in accordance with the Collateral Agent’s instructions. 
  
 9.14 Other Agents; Arrangers and Managers. 
  
 None of the Lenders or other Persons identified herein or on the facing page or signature pages of this Agreement as a “syndication agent,”
“documentation agent,” “co-agent,” “book manager,” “lead manager,” “arranger,” “lead arranger,” “co-lead arranger” or “co-arranger”, if any, shall have any right, power,
obligation, liability, responsibility or duty under this Agreement other than, in the case of such Lenders, those applicable to all Lenders as such. Without limiting the foregoing, none of the Lenders or other Persons so identified shall have or be
deemed to have any fiduciary relationship with any Lender. Each Lender acknowledges that it has not relied, and will not rely, on any of the Lenders or other Persons so identified in deciding to enter into this Agreement or in taking or not taking
action hereunder. 
  
 ARTICLE X. 
 GENERAL PROVISIONS 
  
 10.01 Amendments, Etc. 
  
 No amendment or waiver of any provision of this Agreement or any other Loan Document, and no consent to any departure by the Borrower or any other Loan
Party therefrom, shall be effective unless in writing signed by the Required Lenders and the Borrower or the applicable Loan Party, as the case may be, and each such waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given; provided that no such amendment, waiver or consent shall, unless in writing and signed by all of the Lenders and by the Borrower do any of the following: 
  
 (a) extend or increase the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to Section 8.02); 
  
 (b)
postpone any date fixed by this Agreement or any other Loan Document for any payment or mandatory prepayment of principal, interest, fees or other amounts due to the Lenders (or any of them) hereunder or under any other Loan Document; 
  
 (c) reduce the principal of, or the rate of interest specified herein on, any
Loan, or (subject to clause (iv) of the proviso below) any fees or other amounts payable hereunder or under any other Loan Document, or change the manner of computation of any financial covenant used in determining the Applicable Rate that would
result in a reduction of any interest rate on any Loan; provided that only the consent of the Required Lenders shall be necessary to amend the definition of “Default Rate” contained in Section 1.01 or to waive any
obligation of the Borrower to pay interest at the Default Rate; 
  

 44 

 (d) change (i) the Revolving Line of Credit Commitment Amount, (ii) the Term Commitment Amount or (iii)
the percentage of the Aggregate Commitments or of the aggregate unpaid principal amount of the Loans which is required for the Lenders or any of them to take any action hereunder; 
  
 (e) change the Pro Rata Share or Voting Percentage of any Lender (other than in connection with an assignment effected
pursuant to Section 10.07); 
  
 (f) amend this Section, or
Section 2.11, or any provision herein providing for consent or other action by all the Lenders; or 
  
 (g) release (i) any Guarantor from its Guaranty or (ii) all or any substantial part of the Collateral from any Lien in favor of the Collateral Agent or
the Administrative Agent; 
  
 provided further that (i) no amendment,
waiver or consent shall, unless in writing and signed by the Documentation Agent or the Collateral Agent, as applicable, in addition to the Required Lenders or each directly-affected Lender, as the case may be, affect the rights or duties of the
Documentation Agent or the Collateral Agent, respectively, under this Agreement or any other Loan Document; (ii) no amendment, waiver or consent shall, unless in writing and signed by the Administrative Agent in addition to the Required Lenders or
each directly-affected Lender, as the case may be, affect the rights or duties of the Administrative Agent under this Agreement or any other Loan Document; and (iii) the Fee Letter may be amended, or rights or privileges thereunder waived, in a
writing executed only by the respective parties thereto. Notwithstanding anything to the contrary herein, any Lender that has a Voting Percentage of zero shall not have any right to approve or disapprove any amendment, waiver or consent hereunder,
except that the Pro Rata Share of such Lender may not be increased without the consent of such Lender. 
  
 10.02 Notices and Other Communications; Facsimile Copies. 
  

(a) General. Unless otherwise expressly provided herein, all notices and other communications provided for hereunder shall be in writing
(including by facsimile transmission) and mailed, faxed or delivered, to the address, facsimile number or (subject to subsection (c) below) electronic mail address specified for notices on Schedule 10.02; or, in the case of the Borrower, the
Administrative Agent or the Collateral Agent, to such other address as shall be designated by such party in a notice to the other parties, and in the case of any other party, to such other address as shall be designated by such party in a notice to
the Borrower, the Administrative Agent and the Collateral Agent. All such notices and other communications shall be deemed to be given or made upon the earlier to occur of (i) actual receipt by the intended recipient and (ii) (A) if delivered by
hand or by courier, when signed for by the intended recipient; (B) if delivered by mail, four (4) Business Days after deposit in the mails, postage prepaid; (C) if delivered by facsimile, when sent and receipt has been confirmed by telephone; and
(D) if delivered by electronic mail (which form of delivery is subject to the provisions of subsection (c) below), when delivered; provided that notices and other communications to the Administrative Agent pursuant to Article II shall
be in writing (including by facsimile) and shall not be effective until actually received by such Person. Any notice or other communication permitted to be given, made or confirmed by telephone hereunder shall be given, made or confirmed by means of
a telephone call to the intended recipient at the number specified on Schedule 10.02, it being understood and agreed that a voicemail message shall in no event be effective as a notice, communication or confirmation hereunder. 
  
 (b) Effectiveness of Facsimile Documents and Signatures. Loan
Documents may be transmitted and/or signed by facsimile. The effectiveness of any such documents and signatures shall, subject to applicable Law, have the same force and effect as manually-signed originals and shall be binding on all Loan Parties,
the Administrative Agent, the Documentation Agent, the Collateral Agent and the Lenders. The Administrative Agent and the Collateral Agent may also require that any such documents and signatures be confirmed by a manually-signed original thereof;
provided that the failure to request or deliver the same shall not limit the effectiveness of any facsimile document or signature. 
  

 45 

 (c) Limited Use of Electronic Mail. Electronic mail and Internet and intranet websites may
be used only to distribute routine communications, such as financial statements and other information, and to distribute Loan Documents for execution by the parties thereto, and may not be used for any other purpose. 
  
 (d) Reliance by Administrative Agent, Collateral Agent and Lenders.
The Administrative Agent, the Collateral Agent and the Lenders shall be entitled to rely and act upon any notices (including telephonic Loan Notices and notices sent by electronic mail or through Internet or intranet websites) purportedly given
by or on behalf of the Borrower even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein, or (ii) the terms thereof, as understood by the
recipient, varied from any confirmation thereof. The Borrower shall indemnify each Agent-Related Person and each Lender from all losses, costs, expenses and liabilities resulting from the reliance by such Person on each notice purportedly given by
or on behalf of the Borrower. All telephonic notices to and other communications with the Administrative Agent may be recorded by the Administrative Agent and with the Collateral Agent may be recorded by the Collateral Agent, and each of the parties
hereto hereby consents to any such recording by the Administrative Agent or the Collateral Agent. 
  
 10.03 No Waiver; Cumulative Remedies. 
  
 No failure by any Lender, the Administrative Agent or the Collateral Agent to exercise, and no delay by any such Person in exercising, any right, remedy,
power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy,
power or privilege. The rights, remedies, powers and privileges herein or therein provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law. 
  
 10.04 Attorney Costs, Expenses and Taxes. 
  
 The Borrower agrees (a) to pay or reimburse the Administrative Agent and the Collateral Agent for all costs and expenses
incurred in connection with the development, preparation, negotiation and execution of this Agreement and the other Loan Documents and any amendment, waiver, consent or other modification of the provisions hereof and thereof (whether or not the
transactions contemplated hereby or thereby are consummated), and the consummation and administration of the transactions contemplated hereby and thereby, including all reasonable Attorney Costs (including non-duplicative allocated costs of in-house
counsel) and costs and expenses in connection with the use of the Internet, IntraLinks or other similar information transmission systems in connection with this Agreement, provided that the Borrower shall not be obligated to pay or reimburse
the Administrative Agent or the Collateral Agent in excess of Twenty-Five Thousand Dollars ($25,000.00) for Attorney Costs incurred in connection with the development, preparation, negotiation and execution of this Agreement and the other Loan
Documents executed and delivered on the Closing Date, (b) to pay or reimburse the Collateral Agent for each audit of the Collateral conducted by the Collateral Agent pursuant to the terms of the Loan Documents, provided that, so long as no
Event of Default has occurred and is continuing at the time any such audit is conducted, the Borrower shall not be obligated to pay or reimburse the Collateral Agent in excess of Five Thousand Dollars ($5,000.00) for the cost of such audit, and (c)
to pay or reimburse the Administrative Agent, the Documentation Agent, the Collateral Agent, the Arrangers and each Lender for all costs and expenses (including Attorney Costs) incurred in connection with the enforcement, attempted enforcement, or
preservation of any rights or remedies under this Agreement, the other Loan Documents or applicable Law (including all such costs and expenses incurred during any “workout” or restructuring in respect of 
  

 46 

 the Obligations and during any legal proceeding, including any proceeding under any Debtor Relief Law). The foregoing
costs and expenses shall include all search, filing, recording, title insurance and appraisal charges and fees and taxes related thereto, and other out-of-pocket expenses incurred by the Administrative Agent and the cost of independent public
accountants and other outside experts retained by the Administrative Agent or any Lender. The agreements in this Section shall survive the termination of the Aggregate Commitments and repayment of all other Obligations. 
  
 10.05 Indemnification by the Borrower. 
  
 Whether or not the transactions contemplated hereby are consummated, the
Borrower agrees to indemnify, save and hold harmless, each Agent-Related Person, each Lender and their respective Affiliates, directors, officers, employees, counsel, agents and attorneys-in-fact (collectively the “Indemnitees”)
from and against: (a) any and all claims, demands, actions or causes of action that are asserted against any Indemnitee by any Person (other than the Administrative Agent, the Collateral Agent or any Lender) relating directly or indirectly to a
claim, demand, action or cause of action that such Person asserts or may assert against any Loan Party, any Affiliate of any Loan Party or any of their respective officers or directors arising out of or relating to the Loan Documents, any
predecessor loan documents, any Commitment, the use or contemplated use of the proceeds of any Loan, or the relationship of any Loan Party, the Administrative Agent, the Collateral Agent and the Lenders under this Agreement or any other Loan
Document, (b) any and all claims, demands, actions or causes of action that may at any time (including at any time following repayment of the Obligations and the resignation or removal of the Administrative Agent or the replacement of any Lender) be
asserted or imposed against any Indemnitee arising out of or relating to the Loan Documents, any predecessor loan documents, any Commitment, the use or contemplated use of the proceeds of any Loan, or the relationship of any Loan Party, the
Administrative Agent, the Collateral Agent and the Lenders under this Agreement or any other Loan Document; (c) any administrative or investigative proceeding by any Governmental Authority arising out of or related to a claim, demand, action or
cause of action described in subsection (a) or (b) above; and (d) any and all liabilities (including liabilities under indemnities), losses, costs or expenses (including Attorney Costs) that any Indemnitee suffers or incurs as a result of the
assertion of any foregoing claim, demand, action, cause of action or proceeding, or as a result of the preparation of any defense in connection with any foregoing claim, demand, action, cause of action or proceeding, in all cases, whether or not
arising out of the negligence of an Indemnitee, and whether or not an Indemnitee is a party to such claim, demand, action, cause of action or proceeding (all the foregoing, collectively, the “Indemnified Liabilities”);
provided that no Indemnitee shall be entitled to indemnification for any claim determined in a final, nonappealable judgment by a court of competent jurisdiction to have been caused primarily by its own gross negligence or willful misconduct
or for any loss asserted against it by another Indemnitee. No Indemnitee shall be liable for any damages arising from the use by others of any information or other materials obtained through the Internet, Intralinks or other similar information
transmission systems in connection with this Agreement. The agreements in this Section shall survive the termination of the Aggregate Commitments and repayment of all other Obligations. 
  
 10.06 Payments Set Aside. 
  

To the extent that the Borrower makes a payment to the Administrative Agent or any Lender, or the Administrative Agent or any Lender exercises its
right of set-off, and such payment or the proceeds of such set-off or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by the
Administrative Agent or such Lender in its discretion) to be repaid to a trustee, receiver or any other party, in connection with any proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the obligation or
part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such set-off had not occurred, and (b) each Lender severally agrees to pay to the Administrative Agent
upon demand its applicable share of any amount so 
  

 47 

 recovered from or repaid by the Administrative Agent, plus interest thereon from the date of such demand to the date such
payment is made at a rate per annum equal to the Federal Funds Rate from time to time in effect. 
  
 10.07 Successors and Assigns. 
  
 (a) The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns
permitted hereby, except that the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by the Borrower without such
consent shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby and, to the extent expressly
contemplated hereby, the Indemnitees) any legal or equitable right, remedy or claim under or by reason of this Agreement. 
  
 (b) Any Lender may assign to one or more Eligible Assignees all or a portion of its rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans at the time owing to it); provided that (i) except in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitment and the Loans at the time owing to it or in the
case of an assignment to a Lender or an Affiliate of a Lender or an Approved Fund with respect to a Lender, the aggregate amount of the Commitment (which for this purpose includes Loans outstanding hereunder) subject to each such assignment,
determined as of the date the Assignment and Assumption Agreement with respect to such assignment is delivered to the Administrative Agent, shall not be less than Five Million Dollars ($5,000,000.00) unless the Administrative Agent otherwise
consents (each such consent not to be unreasonably withheld or delayed), (ii) each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with respect
to the Loans or the Commitment assigned, (iii) any assignment of a Commitment (unless the assignor Lender is Bank of America or Wells Fargo) must be approved by the Administrative Agent unless the Person that is the proposed assignee is itself a
Lender (whether or not the proposed assignee would otherwise qualify as an Eligible Assignee) and (iv) the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption Agreement and shall pay to the
Administrative Agent (except where the assignee is an Affiliate of the assignor Lender) a processing and recordation fee in an amount equal to Three Thousand Five Hundred Dollars ($3,500.00). Subject to acceptance and recording thereof by the
Administrative Agent pursuant to subsection (c) of this Section, from and after the effective date specified in each Assignment and Assumption Agreement, the Eligible Assignee thereunder shall be a party hereto and, to the extent of the interest
assigned by such Assignment and Assumption Agreement, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption Agreement, be
released from its obligations under this Agreement (and, in the case of an Assignment and Assumption Agreement covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto but
shall continue to be entitled to the benefits of Sections 3.01, 3.04, 3.05, 10.04 and 10.05). Upon request, the Borrower (at its expense) shall execute and deliver new or replacement Notes to the assigning Lender
and the assignee Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this subsection shall be treated for purposes of this Agreement as a sale by such Lender of a participation in
such rights and obligations in accordance with subsection (d) of this Section. 
  
 (c) The Administrative Agent, acting solely for this purpose as an agent of the Borrower, shall maintain at the Administrative Agent’s Office a copy of each Assignment and Assumption Agreement delivered to it and
a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amount of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The entries
in the Register shall be conclusive, and the 
  

 48 

 Borrower, the Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant
to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon
reasonable prior notice. 
  
 (d) Any Lender may at any time,
without the consent of, or notice to, the Borrower or the Administrative Agent, sell participations to any Person (other than a natural person or the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a
“Participant”) in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or Loans owing to it); provided that (i) such Lender’s obligations
under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent and the other Lenders shall continue
to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall
retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of
the Participant, agree to any amendment, waiver or other modification that would (i) postpone any date upon which any payment of money is scheduled to be paid to such Participant, (ii) reduce the principal, interest, fees or other amounts payable to
such Participant or (iii) release any Guarantor from its Guaranty. Subject to subsection (e) of this Section, the Borrower agrees that each Participant shall be entitled to the benefits of Sections 3.01, 3.04 and 3.05 to the
same extent as if it were a Lender and had acquired its interest by assignment pursuant to subsection (b) of this Section. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 10.09 as though it
were a Lender, provided that such Participant agrees to be subject to Section 2.11 as though it were a Lender. 
  
 (e) A Participant shall not be entitled to receive any greater payment under Section 3.01 or 3.04 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Borrower’s prior written consent. A Participant that would be a Foreign Lender if it were
a Lender shall not be entitled to the benefits of Section 3.01 unless the Borrower is notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Borrower, to comply with Section 10.15 as
though it were a Lender. 
  
 (f) Any Lender may at any time pledge
or assign a security interest in all or any portion of its rights under this Agreement (including under its Notes, if any) to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank;
provided that no such pledge or assignment shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto. 
  
 (g) As used herein, the following terms have the following meanings:

  
 “Approved Fund” means any
Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender. 
  
 “Eligible Assignee” means: (a) a Lender; (b) an Affiliate of a Lender; (c) an Approved
Fund; and (d) any other Person (other than a natural Person) approved by (i) the Administrative Agent and (ii) unless an Event of Default has occurred and is continuing, the Borrower (each such approval not to be unreasonably withheld or delayed);
provided that, notwithstanding the foregoing, “Eligible Assignee” shall not include the Borrower or any of the Borrower’s Affiliates or Subsidiaries. 
  

 49 

 “Fund” means any Person (other than a natural Person) that is (or will
be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business. 
  

10.08 Confidentiality. 
  
 Each of the Administrative Agent, the Collateral Agent and the Lenders agrees to maintain the confidentiality of the Information (as defined below),
except that Information may be disclosed (a) to its and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made
will be informed of the confidential nature of such Information and instructed to keep such Information confidential); (b) to the extent requested by any regulatory authority; (c) to the extent required by applicable laws or regulations or by any
subpoena or similar legal process; (d) to any other party to this Agreement; (e) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or the enforcement of rights hereunder; (f)
subject to an agreement containing provisions substantially the same as those of this Section, to (i) any Eligible Assignee of or Participant in, or any prospective Eligible Assignee of or Participant in, any of its rights or obligations under this
Agreement or (ii) any direct or indirect contractual counterparty or prospective counterparty (or such contractual counterparty’s or prospective counterparty’s professional advisor) to any credit derivative transaction relating to
obligations of the Borrower; (g) with the consent of the Borrower; (h) to the extent such Information (i) becomes publicly available other than as a result of a breach of this Section or (ii) becomes available to the Administrative Agent, the
Collateral Agent or any Lender on a non-confidential basis from a source other than the Borrower; or (i) to the National Association of Insurance Commissioners or any other similar organization or any nationally recognized rating agency that
requires access to information about a Lender’s or its Affiliates’ investment portfolio in connection with ratings issued with respect to such Lender or its Affiliates. In addition, the Administrative Agent, the Collateral Agent and the
Lenders may disclose the existence of this Agreement and information about this Agreement to market data collectors, similar service providers to the lending industry, and service providers to the Administrative Agent, the Collateral Agent and the
Lenders in connection with the administration and management of this Agreement, the other Loan Documents, the Commitments and the Loans. For the purposes of this Section, “Information” means all information received from the
Borrower relating to the Borrower or its business, other than any such information that is available to the Administrative Agent, the Collateral Agent or any Lender on a non-confidential basis prior to disclosure by the Borrower; provided
that, in the case of information received from the Borrower after the date hereof, such information is clearly identified in writing at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as
provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential
information. Notwithstanding anything to the contrary contained herein, the Information referred to in this Section shall not include, and the Borrower, the Administrative Agent, the Collateral Agent, each Lender and the respective Affiliates of
each of the foregoing (and the respective partners, directors, officers, employees, agents, advisors and other representatives of each of the foregoing and their Affiliates) may disclose to any and all Persons, without limitation of any kind, (A)
any information with respect to the United States federal and state income tax treatment of the transactions contemplated hereby and any facts that may be relevant to understanding such tax treatment, which facts shall not include for this purpose
the names of the parties or any other Person named herein, or information that would permit identification of the parties or such other Persons, or any pricing terms or other nonpublic business or financial information that is unrelated to such tax
treatment or facts, and (B) all materials of any kind (including opinions or other tax analyses) relating to such tax treatment or facts that are provided to any of the Persons referred to above. 
  

 50 

 10.09 Set-off. 
  
 In addition to any rights and remedies of the Lenders provided by law, upon the occurrence and during the continuance of any
Event of Default, each Lender is authorized at any time and from time to time, without prior notice to the Borrower or any other Loan Party, any such notice being waived by the Borrower (on its own behalf and on behalf of each Loan Party) to the
fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held by, and other indebtedness at any time owing by, such Lender to or for the credit or the account
of the respective Loan Parties against any and all Obligations owing to such Lender, now or hereafter existing, irrespective of whether or not the Administrative Agent, the Collateral Agent or such Lender shall have made demand under this Agreement
or any other Loan Document and although such Obligations may be contingent or unmatured. Each Lender agrees promptly to notify the Borrower and the Administrative Agent after any such set-off and application made by such Lender; provided that
the failure to give such notice shall not affect the validity of such set-off and application. 
  
 10.10 Interest Rate Limitation. 
  
 Notwithstanding anything to the contrary contained in any Loan Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the maximum rate of non-usurious interest permitted by applicable Law (the
“Maximum Rate”). If the Administrative Agent, the Collateral Agent or any Lender shall receive interest in an amount that exceeds the Maximum Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds
such unpaid principal, refunded to the Borrower. In determining whether the interest contracted for, charged, or received by the Administrative Agent, the Collateral Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent
permitted by applicable Law, (a) characterize any payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in equal
or unequal parts the total amount of interest throughout the contemplated term of the Obligations. 
  
 10.11 Counterparts. 
  
 This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and
the same instrument. 
  
 10.12 Integration; Amendment and
Restatement. 
  
 This Agreement, together with the other Loan
Documents, comprises the complete and integrated agreement of the parties on the subject matter hereof and thereof and supersedes all prior agreements, written or oral, on such subject matter. In the event of any conflict between the provisions of
this Agreement and those of any other Loan Document, the provisions of this Agreement shall control; provided that the inclusion of supplemental rights or remedies in favor of the Administrative Agent, the Collateral Agent, the Lenders or the
Borrower in any other Loan Document shall not be deemed a conflict with this Agreement. Each Loan Document was drafted with the joint participation of the respective parties thereto and shall be construed neither against nor in favor of any party,
but rather in accordance with the fair meaning thereof. Upon the effectiveness of this Agreement in accordance with the provisions hereof, this Agreement amends and restates, and supersedes, the Existing Credit Agreement in its entirety. 

 

 51 

 10.13 Survival of Representations and Warranties. 
  
 All representations and warranties made hereunder and in any other Loan
Document or other document delivered pursuant hereto or thereto or in connection herewith or therewith shall survive the execution and delivery hereof and thereof. Such representations and warranties have been or will be relied upon by the
Administrative Agent, the Collateral Agent and each Lender, regardless of any investigation made by the Administrative Agent, the Collateral Agent or any Lender or on their behalf and notwithstanding that the Administrative Agent, the Collateral
Agent or any Lender may have had notice or knowledge of any Default or Event of Default at the time of any Loan, and shall continue in full force and effect as long as any Loan or any other Obligation shall remain unpaid or unsatisfied. 

 
 10.14 Severability. 
  
 Any provision of this Agreement and the other Loan Documents to which the
Borrower is a party that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions thereof, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. 
  
 10.15 Foreign Lenders. 
  
 Each Lender that is not a “United States person” within the meaning of Section 7701(a)(30) of the Code (a “Foreign Lender”)
shall deliver to the Administrative Agent, prior to receipt of any payment subject to withholding under the Code (or upon accepting an assignment of an interest herein), two duly signed completed copies of either IRS Form W-8BEN or any successor
thereto (relating to such Person and entitling it to an exemption from, or reduction of, withholding tax on all payments to be made to such Person by the Borrower pursuant to this Agreement) or IRS Form W-8ECI or any successor thereto (relating to
all payments to be made to such Person by the Borrower pursuant to this Agreement) or such other evidence satisfactory to the Borrower and the Administrative Agent that such Person is entitled to an exemption from, or reduction of, U.S. withholding
tax. Thereafter and from time to time, each such Person shall (a) promptly submit to the Administrative Agent such additional duly completed and signed copies of one of such forms (or such successor forms as shall be adopted from time to time by the
relevant United States taxing authorities) as may then be available under then current United States laws and regulations to avoid, or such evidence as is satisfactory to the Borrower and the Administrative Agent of any available exemption from or
reduction of, United States withholding taxes in respect of all payments to be made to such Person by the Borrower pursuant to this Agreement, (b) promptly notify the Administrative Agent of any change in circumstances which would modify or render
invalid any claimed exemption or reduction, and (c) take such steps as shall not be materially disadvantageous to it, in the reasonable judgment of such Lender, and as may be reasonably necessary (including the re-designation of its Lending Office)
to avoid any requirement of applicable Laws that the Borrower make any deduction or withholding for taxes from amounts payable to such Person. If such Person fails to deliver the above forms or other documentation, then the Administrative Agent may
withhold from any interest payment to such Person an amount equivalent to the applicable withholding tax imposed by Sections 1441 and 1442 of the Code, without reduction. If any Governmental Authority asserts that the Administrative Agent did not
properly withhold any tax or other amount from payments made in respect of such Person, such Person shall indemnify the Administrative Agent therefor, including all penalties and interest, any taxes imposed by any jurisdiction on the amounts payable
to the Administrative Agent under this Section, and costs and expenses (including reasonable Attorney Costs) of the Administrative Agent. The obligation of the Lenders under this Section shall survive the termination of the Aggregate Commitments,
repayment of all Obligations and the resignation or replacement of the Administrative Agent. 
  

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 10.16 Governing Law. 
  
 (a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA APPLICABLE TO
AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT THE ADMINISTRATIVE AGENT, THE COLLATERAL AGENT AND EACH LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW. 
  
 (b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF CALIFORNIA SITTING IN THE CITY AND COUNTY OF SAN FRANCISCO, CALIFORNIA OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF SUCH STATE, AND, BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, THE BORROWER, THE ADMINISTRATIVE AGENT, THE COLLATERAL AGENT AND EACH LENDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. THE BORROWER, THE ADMINISTRATIVE AGENT, THE COLLATERAL
AGENT AND EACH LENDER IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH
JURISDICTION IN RESPECT OF ANY LOAN DOCUMENT OR OTHER DOCUMENT RELATED THERETO. THE BORROWER, THE ADMINISTRATIVE AGENT, THE COLLATERAL AGENT AND EACH LENDER WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY
OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE. 
  
 10.17
Waiver of Right to Trial by Jury. 
  
 EACH PARTY TO THIS
AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM
WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES
HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY. 
  
 10.18
Patriot Act Notice. 
  
 Each Lender, the Collateral Agent
(for itself and not on behalf of any other Person, including any Lender) and the Administrative Agent (for itself and not on behalf of any other Person, including any Lender) hereby notifies the Borrower that, pursuant to the requirements of the
Patriot Act, it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender, the Collateral Agent or the
Administrative Agent, as applicable, to identify the Borrower in accordance with the Patriot Act. 
  

 53 

 10.19 Time of the Essence. 
  
 Time is of the essence of the Loan Documents. 
  

 54 

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

			
	ARTHROCARE CORPORATION,
	a Delaware corporation, as the Borrower
		
	By:	 	 /s/ Michael A. Baker 

	Printed Name:	 	Michael A. Baker
	Title:	 	President and Chief Executive Officer
	
	BANK OF AMERICA, N.A.,
	as Administrative Agent
		
	By:	 	 /s/ Dora A. Brown 

	Printed Name:	 	Dora A. Brown
	Title:	 	Vice President
	
	WELLS FARGO BANK, NATIONAL ASSOCIATION,
	as Documentation Agent and Collateral Agent
		
	By:	 	 /s/ Jill B. Ta 

	Printed Name:	 	Jill B. Ta
	Title:	 	Senior Vice President
	
	BANK OF AMERICA, N.A.,
	as a Lender
		
	By:	 	 /s/ John C. Plecque 

	Printed Name:	 	John C. Plecque
	Title:	 	Senior Vice President
	
	WELLS FARGO BANK, NATIONAL ASSOCIATION
	as a Lender
		
	By:	 	 /s/ Jill B. Ta 

	Printed Name:	 	Jill B. Ta
	Title:	 	Senior Vice President

  

 SCHEDULE A 
  
 Guarantors 
  

					
	 Name

	 	 Jurisdiction of
 Organization

	 	 Ownership By Company

	 MEDICAL DEVICE ALLIANCE, INC.
	 	Nevada	 	100%
	 PARALLAX MEDICAL, INC.
	 	Delaware	 	100%
	 OC ACQUISITION SUB Llc
	 	California	 	100%

 SCHEDULE 2.01 
  
 Commitments and Pro Rata Shares 
  

									
	 Lender

	 	 Commitment
 Respecting
 Revolving Line
 of Credit Loans

	 	 Commitment
 Respecting Term
 Commitment
 Loans

	 	 Aggregate
 Commitment

	 	 Pro Rata Share of Aggregate
Commitments, Revolving Line
of Credit
Commitment
 Amount and Term
Commitment Amount

	 Bank of America,
 N.A.
	 	$10,000,000.00	 	$15,000,000.00	 	$25,000,000.00	 	50.000000000%
					
	 Wells Fargo Bank,
 National Association
	 	$10,000,000.00	 	$15,000,000.00	 	$25,000,000.00	 	50.000000000%
					
	 Total
	 	$20,000,000.00	 	$30,000,000.00	 	$50,000,000.00	 	100.000000000%

 SCHEDULE 5.06 
  
 Litigation 
  

					
	 TITLE

	  	 CASE #

	  	 Court/County/State

	 Georgeades et al. v. J. Laskoff, MD et al.
	  	02-CA-12539	  	Circuit Court 9th/Orange County/Florida
	 Mastis, Barbara v. ArthroCare
	  	03-11082	  	NY State Supreme Court, County of Westchester
	 Matthews, Susan v. W. McGarvey, MD et al.
	  	2001-52815	  	269th Judicial District/Harris County, Texas
	 Smith & Nephew v. ArthroCare
	  	03-2214	  	District Court/Western District of Tennessee
	 Christiansen v. ArthroCare
	  	40400158	  	4th Judicial District Court, Utah
	 Lyons v. Lysonix
	  	CV-03-356	  	Circuit Court, Jefferson County, Alabama
	 Medley v. ArthroCare
	  	CT-000809-04	  	Circuit Court of Shelly County, TN, 30th Judicial District of Memphis
	 ArthroCare v. Smith & Nephew
	  	01-504	  	District Court/Delaware

  
 The potential for any of the above
litigation to result in a Material Adverse Effect is discussed in the Borrower’s Form 10-Q filed with the SEC on August 6, 2004. 

 SCHEDULE 5.09 
  
 Environmental Matters 
  

None. 

 SCHEDULE 5.13 
  
 Subsidiaries and other Equity Investments 
  
 ArthroCare Corporation 
 EIN: 94-3180312

 Ownership: Public 
 Domicile: Sunnyvale, California 

Incorporation: US (Delaware) 
 Operations: Manufacturing, Distribution,
R&D, Management Headquarters 
  
 ArthroCare International, Inc

 EIN: 77-0509700 
 Ownership: ArthroCare Corporation –
100 percent 
 Domicile: Sunnyvale, California 
 Incorporation: US
(Delaware) 
 Operations: Dormant 
  
 ArthroCare Cayman Islands, LTD 
 EIN: None 
 Ownership: ArthroCare Corporation – 100 percent 
 Domicile: Grand Cayman,
Cayman Islands 
 Incorporation: Cayman Islands 
 Operations:
Non-US Holding Company 
  
 ArthroCare Luxembourg 
 EIN: None 
 Ownership: ArthroCare Cayman Islands – 100 percent

 Domicile: Luxembourg 
 Incorporation: Luxembourg 
 Operations: Non-US Holding Company 
  
 ArthroCare Costa Rica, SRL 
 EIN: None 
 Ownership: ArthroCare Cayman Islands – 100 percent 
 Domicile: Heredia,
Costa Rica 
 Incorporation: Costa Rica 
 Operations:
Manufacturing 
  
 Atlantech Medical Devices, LTD 
 EIN: None 
 Ownership: 100 percent – ArthroCare Cayman Islands, LTD

 Domicile: North Yorkshire, UK 
 Incorporation: UK 

Operations: Manufacturing, Distribution, and R&D 

 ArthroCare Sweden 
 EIN: None 
 Ownership: 100 percent – ArthroCare Luxembourg 
 Domicile: Stockholm, Sweden 
 Incorporation: Sweden 
 Operations: Distribution 
  
 ArthroCare France SARL 
 EIN: None 
 Ownership: 100 percent – ArthroCare Luxembourg 
 Domicile: Paris, France 
 Incorporation: France 
 Operations: Distribution 
  
 ArthroCare Deutschland, GmbH 
 EIN: None 
 Ownership: 100 percent – ArthroCare Luxembourg 
 Domicile: Radevormwald, Germany 
 Incorporation: Germany 
 Operations: Distribution 
  
 ArthroCare Italy, SPA 
 EIN: None 
 Ownership: 100 percent – ArthroCare Luxembourg 
 Domicile: Milan, Italy 
 Incorporation: Italy 
 Operations: Distribution 
  
 ArthroCare UK, LTD

 EIN: None 
 Ownership: 100 percent – ArthroCare
Luxembourg 
 Domicile: Berkshire, England 
 Incorporation:
England 
 Operations: Distribution 
  
 Atlantech Medizinische Produkte Vertriebs GmbH. 
 Ein: None 

Ownership: 100 Percent – ArthroCare Cayman 
 Domicile: Innsbruck,
Austria 
 Incorporation: Austria 
 Operations: Distribution

  
 Atlantech Germany 
 Ein: None 
 Ownership: 100 Percent – ArthroCare Cayman 
 Domicile: RADEVORMWALD, GERMANY 
 Incorporation: Germany 
 Operations: Distribution 

 AngioCare Corporation 
 Ownership: ArthroCare Corporation 
 Domicile: Sunnyvale, California 
 Incorporation: US (California) 
 Operations: Dormant 
  
 Medical Device Alliance, Inc. 
 Ownership: ArthroCare Corporation 
 Domicile: Las Vegas 
 Incorporation: Nevada 
  
 Parallax Medical, Inc. 
 Ownership: ArthroCare Corporation 
 Domicile: Sunnyvale, California

 Incorporation: Delaware 
  
 OC Acquisition Sub LLC 
 Ownership: ArthroCare Corporation 

Domicile: Sunnyvale, California 
 Organization: California 

 SCHEDULE 5.16 
  
 Intellectual Property Matters 
  
 None. 

 SCHEDULE 7.01 
  
 Existing Liens 
  
 None. 

 SCHEDULE 7.02(a) 
  
 Existing Investments 
  

[*] 

	[*]	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the
omitted portions. 

 SCHEDULE 7.02(b) 
  
 Investment Guidelines 
  

[*] 

	[*]	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the
omitted portions. 

 SCHEDULE 7.03 
  
 Existing Indebtedness 
  

[*] 

	[*]	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the
omitted portions. 

 SCHEDULE 7.06 
  
 Existing Leases 
  

							
	 Landlord

	  	 Location

	  	 Lease Term

	  	Monthly pmt

	 Legato Systems
 (LEG005)
	  	 680 Vaqueros
 Ave, Sunnyvale
	  	 9/2001 - 2/2007
	  	137,853.81
				
	 Sunnyvale Mathilda
 Investors LLC
	  	 755 Mathilda
 Ave, Sunnyvale
	  	 11/2003 - 7/2004
	  	14,882.00
				
	 Charles Wong
	  	 781 Palomar
 Ave., Sunnyvale
	  	 month to month
	  	14,000.00
				
	 Industrial Real Estate Lease
	  	 940 Disc Dr.,
 Scotts Valley
	  	 9/2001 - 9/2006
	  	22,053.16
				
	 Small Bay Partners LLC
	  	 631 Progress
 Way, Florida
	  	 1/2004 - 12/2006
	  	2,594.75
				
	 TX-Austin One Congress
 Plaza
	  	 111 Congress
 Ave, Austin
 TX78701
	  	 7/2004 - 6/2006
	  	9,319.82

  
 With the exception of ArthroCare Costa
Rica, SRL, the facilities of all international subsidiaries are leased. 

 SCHEDULE 10.02 
  
 Eurodollar and Domestic Lending Offices; 
 Addresses for Notices 
  
 BORROWER: 
  
 ARTHROCARE CORPORATION 
  
 ArthroCare Corporation 
 680 Vaqueros Ave. 
 Sunnyvale,
CA 94085-3523, USA 
  

			
	 Attention:
	  	 Cristiane Neumann

	 Telephone:
	  	 (408) 735-6258

	 Facsimile
	  	 (408) 530-9143

	 Email:
	  	 cneumann@ArthroCare.com

	 Website:
	  	 www.arthrocare.com

  
 ADMINISTRATIVE
AGENT: 
  
 BANK OF
AMERICA, N.A. 
  
 (for notices other than payments and Loan
Notices): 
  
 Bank of America, N.A. 
 Commercial Agency Management 
 Mail Code: WA1-501-37-20 
 800 Fifth Avenue, Floor 37 
 Seattle WA 98104 
  

			
	 Attention:
	  	 Dora A. Brown

	 Telephone:
	  	 (206) 358-0101

	 Facsimile:
	  	 (206) 358-0971

	 Email:
	  	 dora.a.brown@bankofamerica.com

  
 (for payments and Loan
Notices): 
  
 Bank of America, N.A. 
 Credit Services 
 Mail Code: CA4-706-05-09 
 1850 Gateway Boulevard 
 Concord CA 94520 
  

			
	 Attention:
	  	 Leroy Granby

	 Telephone:
	  	 (925) 675-8368

	 Facsimile:
	  	 (888) 969-2419

	 Email:
	  	 leroy.s.granby@bankofamerica.com

  

 Wire Instructions: 
  
 Bank of America, N.A. 
 Dallas TX 
 ABA 111000012 
 Account Name: Corporate FTA 
 Account Number: 3750836479 
 Attention: Leroy Granby 
 Reference: ArthroCare Corporation 
  
 COLLATERAL AGENT: 
  
 WELLS FARGO BANK, NATIONAL ASSOCIATION 
  
 Wells Fargo Bank, National Association 
 400 Hamilton Avenue 
 P.O. Box 150 
 Palo Alto, CA 94302 
  

			
	 Attention:
	  	 Jill B. Ta, Vice President and Senior Relationship Manager

	 Telephone:
	  	 (650) 855-6629

	 Facsimile:
	  	 (650) 328-0814

	 Email:
	  	 tajillb@wellsfargo.com

  
 LENDERS: 
  
 BANK OF AMERICA, N.A. 
  
 Bank of America, N.A. 
 Mail Code: CA5-106-02-01 
 530 Lytton Avenue 
 Palo Alto CA 94301-1539 
  

			
	 Attention:
	  	 John C. Plecque, Senior Vice President

	 Telephone:
	  	 (650) 853-4475

	 Facsimile:
	  	 (650) 853-4529

	 Email:
	  	 john.plecque@bankofamerica.com

  
 WELLS
FARGO BANK, NATIONAL ASSOCIATION 
  
 Wells Fargo Bank, National Association 
 400 Hamilton Avenue 
 P.O. Box 150 
 Palo Alto, CA 94302 
  

			
	 Attention:
	  	 Jill B. Ta, Vice President and Senior Relationship Manager

	 Telephone:
	  	 (650) 855-6629

	 Facsimile:
	  	 (650) 328-0814

	 Email:
	  	 tajillb@wellsfargo.com

  

 EXHIBIT A 
  

FORM OF LOAN NOTICE 
  
 Date:             ,         

  
 To: Bank of America, N.A., as Administrative Agent 
  
 Ladies and Gentlemen: 
  
 Reference is made to that certain Amended and Restated Credit Agreement, dated as of October 15, 2004 (as amended,
restated, extended, supplemented or otherwise modified in writing from time to time, the “Agreement”; capitalized terms used but not otherwise defined herein have the meaning ascribed thereto in the Agreement), among ArthroCare
Corporation, a Delaware corporation (the “Borrower”), the Lenders from time to time party thereto, Bank of America, N.A., as Administrative Agent, and Wells Fargo Bank, National Association, as Documentation Agent and
Collateral Agent. 
  
 The undersigned hereby requests (select
one): 
  

	 	 ̈  A	Borrowing of
                                        
Loans. 

                                        
         [Type of Loans requested] 
  
 The above-referenced Loans shall be [check appropriate blank]:          Revolving Line of Credit Loans      Term Commitment Loans. 

 

	 	 ̈	A conversion of Loans from              to
             

  

	 	 ̈	A continuation of
                                       
 . 

	 	    	                                [Type of Loans requested]

  

	 	1.	On
                                        
                     (a Business Day). 

  

	 	2.	In the amount of
$                            . 

  

	 	3.	Comprised of
                                       
             . 

	 	    	                    [Type of Loans requested] 

  

	 	4.	With an Interest Period of              months. 

  
 The Borrowing requested herein complies with the proviso to [check
appropriate blank]:              the first sentence of Section 2.01 of the Agreement              the first
sentence of Section 2.01(b) of the Agreement. 
  

			
	 ARTHROCARE CORPORATION

		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

 EXHIBIT B 
  

FORM OF REVOLVING LINE OF CREDIT NOTE 
  
 $
                                      
                                        
                      
                                        
                 
 FOR VALUE RECEIVED, the undersigned
(the “Borrower”), hereby promises to pay to the order of
                                        
     (the “Lender”) the principal amount of                     Dollars
($                    ) or such lesser aggregate outstanding principal amount of all Revolving Line of Credit Loans (as defined in the
Credit Agreement hereinafter defined) made by the Lender to the Borrower pursuant to that certain Amended and Restated Credit Agreement, dated as of October 15, 2004 (as amended, restated, extended, supplemented or otherwise modified in writing from
time to time, the “Agreement”; capitalized terms used but not otherwise defined herein have the meaning ascribed thereto in the Agreement), among the Borrower, the Lenders from time to time party thereto, Bank of America, N.A., as
Administrative Agent, and Wells Fargo Bank, National Association, as Documentation Agent and Collateral Agent, on the dates and in the amounts and as otherwise provided in the Credit Agreement. 
  
 The Borrower further promises to pay interest on the unpaid principal amount
of each Revolving Line of Credit Loan evidenced hereby from the date of such Revolving Line of Credit Loan until such principal amount is paid in full, at such interest rates, and at such times as are specified in the Agreement. All payments of
principal and interest shall be made to the Administrative Agent for the account of the Lender in Dollars in immediately available funds at the Administrative Agent’s Office. If any amount is not paid in full when due hereunder, such unpaid
amount shall bear interest, to be paid upon demand, from the due date thereof until the date of actual payment (and before as well as after judgment) computed at the per annum rate set forth in the Agreement. 
  
 This Revolving Line of Credit Note (this “Note”) is one of
the Revolving Line of Credit Notes referred to in the Agreement, is entitled to the benefits thereof and is subject to optional and mandatory prepayment in whole or in part as provided therein. This Note is also entitled to the benefits of
the Guaranties and is secured pursuant to the terms of the Security Documents. Upon the occurrence of one or more of the Events of Default specified in the Agreement, all amounts then remaining unpaid on this Note shall become, or may be
declared to be, immediately due and payable all as provided in the Agreement. Revolving Line of Credit Loans made by the Lender shall be evidenced by one or more loan accounts or records maintained by the Lender in the ordinary course of business.
The Lender may also attach schedules to this Note and endorse thereon the date, amount and maturity of its Revolving Line of Credit Loans and payments with respect thereto. 
  
 The Borrower, for itself, its successors and assigns, hereby waives diligence, presentment, protest and demand and notice of
protest, demand, dishonor and non-payment of this Note. 
  
 THIS
NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL
LAW. 
  

			
	 ARTHROCARE CORPORATION

		
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

 EXHIBIT C 
  

FORM OF COMPLIANCE CERTIFICATE 
  
 Financial Statement Date:              , 200    

  
 The undersigned refers to that certain Amended and Restated
Credit Agreement, dated as of October 15, 2004 (as amended, modified and/or supplemented from time to time, the “Credit Agreement”), among ArthroCare Corporation, a Delaware corporation (the “Borrower”), the
financial institutions from time to time party thereto (collectively, the “Lenders”), Bank of America, National Association, as Administrative Agent (the “Administrative Agent”), and Wells Fargo Bank, National
Association, as Documentation Agent and Collateral Agent. Unless otherwise defined herein, each capitalized term used herein has the meaning assigned thereto in the Credit Agreement. 
  
 The undersigned Responsible Officer of the Borrower hereby certifies as of the date hereof that s/he holds the office of
                     with the Borrower, that, as such, s/he is authorized to execute and deliver this Certificate to the Administrative Agent
and the Lenders on behalf of the Borrower and its Subsidiaries, and that: 
  
 1. • Attached hereto or • posted on the Borrower’s website or • posted on the website of the Securities and Exchange Commission at http://www.sec.gov. is: 
  
 (a)         
a consolidated balance sheet of the Borrower and its Subsidiaries as at the end of the fiscal year ended [                    ,
200    ] (the “Subject Fiscal Year”), and the related consolidated statements of income or operations, shareholders’ equity and cash flows for the Subject Fiscal Year, setting forth in each case in
comparative form the figures for the previous fiscal year, all in reasonable detail, audited and accompanied by a report and opinion of an independent certified public accountant of nationally recognized standing reasonably acceptable to the
Required Lenders, which report and opinion have been prepared in accordance with GAAP and are not subject to any qualifications or exceptions as to the scope of the audit nor to any qualifications and exceptions that are not reasonably acceptable to
the Required Lenders; or 
  
          an SEC Form 10-K for the Borrower (excluding the exhibits thereto) relating to the fiscal year ended
[                    , 200    ]; or 
  
 (b)          a consolidated balance sheet of the Borrower and
its Subsidiaries as at the end of the fiscal quarter ended [                    , 200    ] (the “Subject
Fiscal Quarter”), and the related consolidated statements of income or operations, shareholders’ equity and cash flows for the Subject Fiscal Quarter and for the portion of the Borrower’s fiscal year then ended, setting forth in
each case in comparative form the figures for the corresponding fiscal quarter of the previous fiscal year and the corresponding portion of the previous fiscal year, all in reasonable detail and certified by a Responsible Officer of the Borrower as
fairly presenting the financial condition, results of operations and cash flows of the Borrower and its Subsidiaries in accordance with GAAP, subject only to normal year-end audit adjustments and the absence of footnotes; or 
  
 •     an SEC Form 10-Q for
the Borrower (excluding the exhibits thereto) relating to the fiscal quarter ended [                    , 200    ].

  
 2. The financial statements referred to in Paragraph 1 fairly
present, in all material respects, the consolidated financial position and the results of operations of the Borrower and its Subsidiaries. 
  

 C-1 

 3. The undersigned has reviewed and is familiar with the terms of the Credit Agreement and the other Loan
Documents and has made, or has caused to be made under my supervision, a detailed review of the transactions and conditions (financial or otherwise) of the Borrower and its Subsidiaries during the accounting period covered by the attached financial
statements. 
  
 4. To the best of the undersigned’s
knowledge, the Borrower and each of its Subsidiaries have, during such period, observed, performed and/or satisfied and/or have caused to be observed, performed and/or satisfied all of their respective covenants and other agreements contained in the
Loan Documents to which they are a party, and have satisfied every condition in the Loan Documents to which they are a party to be observed, performed and/or satisfied by them, and the undersigned has no knowledge of any condition, event or
occurrence, which constitutes a Default or Event of Default, except as set forth below: 
  
 [Describe below (or in a separate attachment to this Certificate) the exceptions, if any, to paragraph 4 above by listing, in detail and with reference to specific sections of the Credit Agreement, the nature of the
condition, event or occurrence, the period during which it has existed and the actions that the Borrower has taken, is taking or proposes to take with respect to such condition, event or occurrence.] 
  
 5. The financial covenant and other compliance analyses and information set
forth on Schedule 1 attached hereto are true, complete and accurate on and as of the date of this Certificate. 
  
 The foregoing certifications, together with the computations set forth in Schedule 1 hereto, are made and delivered, and the financial statements
referenced above are made or posted, as applicable, this          day of             , 200    , pursuant to
the provisions of the Credit Agreement. 
  

			
	 By:
	 	  

	 Title:
	 	  

	 	 	 of ARTHROCARE CORPORATION

  

 C-2 

 Schedule 1 
 to Compliance Certificate 
  
 [Set forth detailed compliance information for all financial covenants] 
  

 C-3 

 EXHIBIT D 
  

FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT 
  
 This Assignment and Assumption Agreement (this “Assignment”) is dated as of the Effective Date set forth below and is entered into by and
between                  (the “Assignor”) and              (the
“Assignee”). Capitalized terms used but not defined herein shall have the meanings given to them in the Amended and Restated Credit Agreement identified below (the “Credit Agreement”), receipt of a copy of which is
hereby acknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment as if set forth herein in full. 
  
 For an agreed consideration, the Assignor hereby irrevocably sells and
assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below, the interest in and to all of the Assignor’s rights and obligations under the Credit Agreement and any other documents or instruments delivered pursuant thereto that represents the amount and
percentage interest identified below of all of the Assignor’s outstanding rights and obligations under the respective facilities identified below (including, to the extent included in any such facilities and Letters of Credit) (the
“Assigned Interest”). Such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment, without representation or warranty by the Assignor. 
  

					
	 1.
	  	Assignor:	  	_____________________
			
	 2.
	  	Assignee:	  	_____________________ [and is an Affiliate/Approved Fund]
			
	 3.
	  	Borrower(s):	  	ArthroCare Corporation
			
	 4.
	  	Administrative Agent:	  	Bank of America, N.A., as the administrative agent under the Credit Agreement
			
	 5.
	  	Credit Agreement:	  	Amended and Restated Credit Agreement, dated as of October 15, 2004 (as amended, modified and/or supplemented through the Effective Date), among ArthroCare Corporation, the Lenders parties
thereto, Bank of America, N.A., as Administrative Agent, and Wells Fargo Bank, National Association, as Documentation Agent and Collateral Agent
			
	 6.
	  	Assigned Interest:	  	 

  

										
	Facility Assigned

	 	 Aggregate
 Amount of
 Commitments/Loans
 for all Lenders

	 	 Amount of
 Commitments/Loans
 Assigned

	 	 Percentage
 Assigned of
 Commitments/Loans

	 
	____________	 	$	____________	 	$	____________	 	____________	%
	____________	 	$	____________	 	$	____________	 	____________	%
	____________	 	$	____________	 	$	____________	 	____________	%

  
 Effective Date:
                        , 200     [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE
THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.] 
  

 D-1 

 The terms set forth in this Assignment are hereby agreed to: 
  

			
	 ASSIGNOR

	
	 [NAME OF ASSIGNOR]

		
	 By:
	 	  

	 Title:
	 	 
	
	 ASSIGNEE

	
	 [NAME OF ASSIGNEE]

		
	 By:
	 	  

	 Title:
	 	 

  

			
	 Consented to and Accepted:

	
	 BANK OF AMERICA, N.A.,

	   as Administrative Agent

		
	 By:
	 	  

	 Title:
	 	 

  

 D-2 

 ANNEX 1 TO ASSIGNMENT AND ASSUMPTION AGREEMENT 
  
 [                    ]1 
  
 STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT 
  
 AND ASSUMPTION AGREEMENT 
  
 1. Representations and Warranties. 
  
 1.1 Assignor. The Assignor (a) represents and warrants that (i) it is
the legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and to consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with any Loan Document, (ii) the execution,
legality, validity, enforceability, genuineness, sufficiency or value of the Credit Agreement or any other instrument or document delivered pursuant thereto, other than this Assignment (herein collectively the “Loan Documents”), or
any collateral thereunder, (iii) the financial condition of the Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in respect of any Loan Document or (iv) the performance or observance by the Borrower, any of its
Subsidiaries or Affiliates or any other Person of any of their respective obligations under any Loan Document. 
  
 1.2 Assignee. The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it meets all requirements of an Eligible Assignee under the Credit Agreement, (iii) from and after the Effective
Date, it shall be bound by the provisions of the Credit Agreement and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it has received a copy of the Credit Agreement, together with copies of the most
recent financial statements delivered pursuant to Section 6.01 thereof, as applicable, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and to purchase
the Assigned Interest on the basis of which it has made such analysis and decision, and (v) if it is a Foreign Lender, attached hereto is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed
and executed by the Assignee; and (b) agrees that (i) it will, independently and without reliance on the Administrative Agent, the Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed
by it as a Lender. 
  
 1.3 Assignee’s Address for Notices,
etc. Attached hereto as Schedule 1 is all contact information, address, account and other administrative information relating to the Assignee. 
  
 2. Payments. From and after the Effective Date, the Administrative Agent shall make all payments in respect of the Assigned Interest (including
payments of principal, interest, fees and other amounts) to the Assignee whether such amounts have accrued prior to or on or after the Effective Date. The Assignor and the Assignee shall make all appropriate adjustments in payments by the
Administrative Agent for periods prior to the Effective Date or with respect to the making of this assignment directly between themselves. 

	1	Describe Credit Agreement at option of Administrative Agent. 

  

 D-3 

 3. General Provisions. This Assignment shall be binding upon, and inure to the benefit of, the
parties hereto and their respective successors and assigns. This Assignment may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assignment by
telecopy shall be effective as delivery of a manually executed counterpart of this Assignment. THIS ASSIGNMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT THE PARTIES HERETO SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW. 
  

 D-4 

 SCHEDULE 1 TO ASSIGNMENT AND ASSUMPTION AGREEMENT 
  
 ADMINISTRATIVE DETAILS 
  
 (Assignee to list names of credit contacts, addresses, phone and facsimile
numbers, electronic mail addresses and account and payment information) 
  

 D-5 

 EXHIBIT E 
  

FORM OF CONTINUING GUARANTY AGREEMENT 
  
 CONTINUING GUARANTY AGREEMENT 
  
 This CONTINUING GUARANTY AGREEMENT (this “Agreement”), dated as of
[                     ], 200[    ], is made by each of the undersigned (each, a “Guarantor”
and, collectively, the “Guarantors”), in favor of each Guaranteed Party (as hereinafter defined). 
  
 WHEREAS, ArthroCare Corporation, a Delaware corporation (the “Company”), Bank of America, N.A., as Administrative Agent and as a Lender,
Wells Fargo Bank, National Association, as Documentation Agent, as Collateral Agent and as a Lender, and the other financial institutions as are, or may from time to time become, parties thereto have entered into or are in the process of entering
into that certain Amended and Restated Credit Agreement, dated as of October 15, 2004 (as amended, modified and/or supplemented from time to time, the “Credit Agreement”), pursuant to which the Lenders have provided the Commitments
and agreed to make Loans to the Company on the terms and conditions contained therein; and 
  
 WHEREAS, to induce the Lenders to provide and to continue to provide financial accommodations to the Company pursuant to the terms of the Credit Agreement and the other Loan Documents, the Guarantors have each agreed
to enter into this Agreement; 
  
 NOW, THEREFORE, for good and
valuable consideration (the receipt and sufficiency of which are hereby acknowledged), and intending to be legally bound hereby, each Guarantor irrevocably and unconditionally undertakes and agrees for the benefit of Guaranteed Party as follows:

  
 ARTICLE I 
  
 CERTAIN DEFINITIONS AND RULES OF CONSTRUCTION 
  
 Section 1.1 Certain Definitions. Each capitalized term used but not
otherwise defined herein has the meaning ascribed thereto in the Credit Agreement. As used herein, the term “Guaranteed Party” means, as the context may require, the Administrative Agent, the Documentation Agent, the Collateral
Agent and each Lender (and each of such Person’s respective successors, transferees and assigns). 
  
 Section 1.2 Construction. For purposes of this Agreement and unless otherwise specified herein: (a) references to the plural include the singular
and to the singular include the plural, references to any gender include any other gender, the part includes the whole, the term “including” is not limiting, and the term “or” has, except where otherwise indicated, the inclusive
meaning represented by the phrase “and/or”; (b) references in this Agreement to any determination by the Guaranteed Party include good faith estimates (in the case of quantitative determinations) and good faith beliefs (in the case of
qualitative determinations) by any Guaranteed Party; any determination made in good faith by any Guaranteed Party shall be conclusive absent manifest error; (c) the words “hereof,” “herein,” “hereby,” and
“hereunder,” and any other similar words, refer to this Agreement as a whole and not to any particular provision of this Agreement; (d) article, section, subsection, clause, exhibit and schedule references are to this Agreement; and (e)
any reference to this Agreement or any other Loan Document includes all permitted alterations, amendments, changes, extensions, modifications, renewals, or supplements thereto or thereof, as applicable. 
  

 E-1 

 ARTICLE II 
  
 GUARANTY BY GUARANTORS 
  
 Section 2.1 Promise to Pay and Perform. Each Guarantor jointly and severally unconditionally and irrevocably guarantees to each Guaranteed Party
the payment and performance of all Obligations when and as the same shall become due and payable (whether at stipulated or any accelerated or earlier date of maturity (including the date of any required prepayment)) (the “Guaranteed
Obligations”), it being each Guarantor’s intent that such Guarantor’s guaranty is a guaranty of payment and not a guaranty of collection. If the Company fails to pay or perform any Guaranteed Obligation on or before the date when
due (whether at stipulated or any accelerated or earlier date of maturity (including the date of any required prepayment)), each Guarantor shall jointly and severally unconditionally and immediately make such payment or render such performance upon
written demand therefor by any Guaranteed Party. 
  
 Section 2.2
Cumulative Obligations; Continuing Guaranty. The obligations of each Guarantor hereunder are in addition to any other obligations of such Guarantor under any other guaranties of the Indebtedness or other obligations of the Company or any
other Person at any time given to any Guaranteed Party. This Agreement shall not affect or invalidate any such other guaranties. This Agreement is a continuing guaranty and shall remain in full force and effect notwithstanding the fact that, at any
particular time, no Guaranteed Obligations may be outstanding. 
  
 Section 2.3 Joint and Several Obligation; Independent Obligation. Each Guarantor is directly, jointly and severally with all other guarantors of the Guaranteed Obligations or any portion thereof, liable to the Guaranteed Parties. The
obligations of each Guarantor hereunder are direct and primary and are independent of the obligations of the Company or any other such guarantor, and a separate action may be brought against each Guarantor irrespective of whether an action is
brought against the Company or any other such other guarantor or whether the Company or any such other guarantor is joined in such action. Each Guarantor’s liability hereunder shall not be contingent upon the exercise or enforcement by the
Guaranteed Parties of any remedies they may have against the Company or any other guarantor or the enforcement of any Lien or realization upon any security the Guaranteed Parties may at any time possess. Any release that may be given by the
Guaranteed Parties to the Company or any other guarantor shall not release any Guarantor hereunder unless such release expressly so provides. 
  
 Section 2.4 Limit of Liability. Notwithstanding anything to the contrary contained herein, each Guarantor shall be liable hereunder only for the
largest amount that would not render such Guarantor’s obligations hereunder subject to avoidance under Section 548 of the Bankruptcy Code or comparable provisions of any applicable state law; provided that such amount shall be presumed
to be the entire amount of the Guaranteed Obligations. If, any Guarantor claims that such Guarantor’s liability hereunder is less than the entire amount of the Guaranteed Obligations, such Guarantor shall have the burden of proving, by clear
and convincing evidence, that such Guarantor’s liability hereunder should be so limited since the information concerning, and the circumstances of, the financial condition of such Guarantor are more readily available to and are under the
control of such Guarantor. All payments received by any Guaranteed Party from any Person other than a Guarantor on account of the Guaranteed Obligations shall be deemed as having been applied to Guaranteed Obligations that, pursuant to this
Section 2.4, are in excess of the amounts guaranteed hereunder. 
  

 E-2 

 ARTICLE III 
  
 PAYMENTS 
  
 Section 3.1 Nature and Application of Payments. Each Guarantor shall make all payments hereunder in immediately available lawful money of the
United States, without deduction or withholding (whether for taxes (whether income, excise, or otherwise) or offset). Without regard to the form in which received, the Guaranteed Parties may apply any payment with respect to the Guaranteed
Obligations or any other amounts due hereunder in such order as the Guaranteed Parties shall in their sole and absolute discretion determine, irrespective of any contrary instructions received from any other Person. 
  
 Section 3.2 Indefeasible Payment; Revival. If any portion of any
payment to the Guaranteed Parties is set aside and repaid by any Guaranteed Party for any reason after being made by any Guarantor, the amount so set aside shall be revived as a Guaranteed Obligation and each Guarantor shall be liable for the full
amount the Guaranteed Parties are, or any Guaranteed Party is, required to repay plus all costs and expenses (including attorneys’ fees, costs, and expenses) incurred by the Guaranteed Parties in connection therewith. 
  
 ARTICLE IV 
  
 CERTAIN REPRESENTATIONS AND WARRANTIES OF GUARANTORS 
  
 Each Guarantor represents and warrants as follows (which representations and warranties shall be true, correct, and complete
at all times): 
  
 Section 4.1 No Contravention; No
Default. The execution, delivery, and performance by such Guarantor of this Agreement do not and will not: (a) conflict with or result in any breach or contravention of, or the creation of any Lien under, any contractual obligation to which such
Guarantor is a party or any order, injunction, writ, or decree of any governmental authority to which such Guarantor or such Guarantor’s properties are subject; or (b) violate any law, rule, or regulation of any governmental authority.

  
 Section 4.2 Binding Effect. This Agreement constitutes
the legal, valid, and binding obligation of such Guarantor, enforceable against such Guarantor in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, or similar laws affecting the enforcement of
creditors’ rights generally or by equitable principles relating to enforceability. 
  
 Section 4.3 Litigation. Except as set forth on Schedule 5.06 to the Credit Agreement, there are no actions, suits, proceedings, claims, or disputes pending, or, to the best knowledge of such Guarantor,
threatened in writing, at law, in equity, in arbitration, or before any governmental authority, against such Guarantor or any of such Guarantor’s properties which purport to affect or pertain to this Agreement, any of the other Loan Documents,
or any of the transactions contemplated hereby or thereby. 
  
 Section 4.4 Regulated Entity. Neither such Guarantor nor any Person controlling such Guarantor is: (a) an “investment company” within the meaning of the Investment Company Act of 1940; or (b) subject to regulation by any
federal or state statute or regulation limiting such Guarantor’s ability to incur such Guarantor’s obligations hereunder. 
  
 Section 4.5 No Action Required. No consent, license, permit, approval or authorization of, exemption by, notice or report to, or registration,
filing, or declaration with any governmental authority or of, to, or with any other Person, is or will be required for: (a) the execution, delivery, or performance of this Agreement by such Guarantor; or (b) the exercise by the Guaranteed Parties of
any of their respective rights and remedies provided for herein. 
  

 E-3 

 Section 4.6 Changes Affecting the Guaranteed Obligations. Such Guarantor has taken and is taking
all steps in such Guarantor’s opinion necessary or appropriate to be informed on a continuing basis of changes or potential changes affecting the Guaranteed Obligations. Without limiting the generality of the foregoing, such Guarantor hereby
confirms that it has received and reviewed the Credit Agreement, the Fee Letter and all other Loan Documents (and all other agreements, documents and instruments related thereto) that such Guarantor, in such Guarantor’s sole determination, has
deemed necessary or appropriate to receive and review. 
  
 Section
4.7 Reliance by Guarantor; Financial Condition of the Company. This Agreement is not made by such Guarantor in reliance on any representation or warranty, express or implied, by any Guaranteed Party concerning the financial condition of the
Company, the nature, value, or extent of any security for the Guaranteed Obligations, or any other matter. Such Guarantor is presently informed of the financial condition of the Company and of all other circumstances that a diligent inquiry would
reveal and which bear upon the risk of nonpayment of the Guaranteed Obligations. Such Guarantor has reviewed each of the Loan Documents. 
  
 Section 4.8 Adequate Consideration. The consideration given or provided, or to be given or provided, by the Guaranteed Parties in connection with
this Agreement is adequate and satisfactory in all respects, and represents reasonably equivalent value, to support this Agreement and such Guarantor’s obligations hereunder. 
  
 ARTICLE V 
  
 CERTAIN COVENANTS OF GUARANTORS 
  
 Section 5.1 Knowledge of Financial Condition. Each Guarantor shall keep informed of the Company’s financial condition, the status of any
guarantors or of any security for the Guaranteed Obligations, and all other circumstances that bear upon the risk of nonpayment of the Guaranteed Obligations. 
  

Section 5.2 Further Assurances. Each Guarantor shall, from time to time, at the expense of such Guarantor, promptly execute and deliver all
further documents and take all further action that may be necessary, or that the Guaranteed Parties (or any of them) may reasonably request, to enable the Guaranteed Parties (or any of them) to exercise and enforce their respective rights and
remedies hereunder. 
  
 Section 5.3 Sales, Dispositions,
etc. Each Guarantor will not, without the prior written consent of the Guaranteed Party, sell, lease, assign, encumber, hypothecate, transfer or otherwise dispose of all of substantially all of such Guarantor’s properties or assets, or any
interest therein, except as otherwise permitted by the Credit Agreement. 
  
 ARTICLE VI 
  
 CERTAIN ACKNOWLEDGEMENTS AND AGREEMENTS
OF GUARANTORS 
  
 Section 6.1 Modifications to Loan
Documents and Guaranteed Obligations. Each Guarantor acknowledges and agrees that, without notice to such Guarantor and without affecting or impairing the obligations of such Guarantor hereunder, the Guaranteed Parties (or any of them) may, by
action or inaction, compromise or settle, extend the period of duration or the time for the payment, or discharge the 
  

 E-4 

 performance of, or may refuse to, or otherwise not enforce, or may, by action or inaction, release all or any one or more
parties to, any one or more of the Loan Documents or otherwise with respect to the Guaranteed Obligations or may grant other indulgences to the Company in respect thereof, or may amend or modify in any manner and at any time (or from time to time)
any one or more of the Loan Documents or otherwise with respect to the Guaranteed Obligations, or may, by action or inaction, release or substitute any guarantor, if any, of the Guaranteed Obligations, or may enforce, exchange, release, or waive, by
action or inaction, any security for the Guaranteed Obligations or any guaranty of the Guaranteed Obligations, or any portion thereof. 
  
 Section 6.2 Subordination. Each Guarantor agrees that any and all present and future indebtedness of the Company owing to such Guarantor is
postponed in favor of and subordinated to indefeasible payment, in full, in cash, of the Guaranteed Obligations. In this regard, upon the occurrence and during the continuance of a Default or an Event of Default, no payment of any kind whatsoever
shall be made with respect to such indebtedness until the Guaranteed Obligations have been indefeasibly paid in full. Any payment received by any Guarantor in respect of such indebtedness shall be held by such Guarantor as trustee for the Guaranteed
Parties and promptly paid over to the Guaranteed Parties on account of the Guaranteed Obligations but without reducing or affecting in any manner the liability of such Guarantor under the other provisions of this Agreement. 
  
 Section 6.3 Administrative Agent as Each Guarantor’s
Attorney-in-Fact. Each Guarantor irrevocably appoints the Administrative Agent as such Guarantor’s attorney-in-fact, with full authority in the place and stead and name of such Guarantor, from time to time at the Administrative Agent’s
discretion but only following the occurrence and during the continuation of an Event of Default, to take any action and to execute any instrument which the Guaranteed Parties (or any of them) may, in accordance with the provisions of the Loan
Documents or this Agreement, require as necessary or advisable to accomplish the purposes of this Agreement. 
  
 ARTICLE VII 
  
 GENERAL PROVISIONS 
  
 Section 7.1 Notices.
All notices, requests, and other communications to any party under this Agreement shall be in writing (including telegraphic, telex, telefacsimile, or cable communication) and mailed, telegraphed, telexed, sent by telefacsimile, cabled, or delivered
to such party at its address or telefacsimile number set forth, in the case of each Guarantor, on the signature pages hereof, or, in the case of the Guaranteed Parties, on Schedule 10.02 to the Credit Agreement, or such other address or
telefacsimile number as such party may hereafter specify for the purpose by notice to the other party given in accordance with this Section 7.1. Each such notice, request or other communication shall be deemed to have been received: (a) if
mailed as provided above by any method other than overnight delivery service, on the third Business Day after deposit in the mails; (b) if mailed by overnight delivery service, telegraphed, telexed, sent by telefacsimile, or cable, when delivered
for overnight delivery, delivered to the telegraph company, confirmed by telex answerback, transmitted by telefacsimile (with electronic confirmation), or delivered to the cable company, respectively; or (c) if delivered by hand, upon delivery. If
any conflict exists between any oral communication to any Guaranteed Party and the written confirmation thereof, the oral communication shall control if any Guaranteed Party has acted thereon prior to actual receipt of such written confirmation.

  
 Section 7.2 Amendments, Waivers, and Consents. No
amendments or waivers of any provision of this Agreement nor any consent to any departure by any Guarantor from the terms hereof shall in any event be effective unless the same shall be in writing and signed by the Administrative Agent (or all
Guaranteed Parties if required by the terms of the Credit Agreement) and the Guarantors. Any such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. 
  

 E-5 

 Section 7.3 No Waiver; Cumulative Nature of Remedies. No failure or delay on the part of any
Guaranteed Party in exercising any of its rights and remedies under this Agreement, any of the Loan Documents, or otherwise with respect to any of the Guaranteed Obligations shall operate as a waiver thereof; nor shall any single or partial exercise
of any right under this Agreement, the Loan Documents, or otherwise with respect to the Guaranteed Obligations preclude any other or further exercise thereof or the exercise of any other right or remedies. The rights and remedies provided in this
Agreement and otherwise with respect to the Guaranteed Obligations are cumulative and not exclusive of any rights and remedies provided by law. 
  
 Section 7.4 Costs and Expenses. Each Guarantor shall pay or reimburse the Guaranteed Parties on demand for all fees, costs, and expenses incurred
by the Guaranteed Parties in connection with the enforcement or attempted enforcement of this Agreement, the preservation of any rights or remedies under this Agreement, or in any action, case, or proceeding (whether at law or in equity) relating to
this Agreement. Without limiting the generality of the foregoing, such fees, costs, and expenses shall include reasonable Attorney Costs actually incurred by the Guaranteed Parties or any of them (irrespective of whether the Company is liable
therefor), whether or not suit is brought, in connection therewith. 
  
 Section 7.5 Successors and Assigns. This Agreement shall: (a) be binding upon each Guarantor and each Guarantor’s successors and assigns; and (b) inure to the benefit of each Guaranteed Party and its successors and assigns (all
to the extent permitted by the Loan Documents). Without limiting the generality of the foregoing subsection (b) but subject to the provisions of the Credit Agreement, any Guaranteed Party may assign or otherwise transfer all or any part of
the Guaranteed Obligations owed to it to any other Person. 
  
 Section 7.6 Headings. Section and subsection headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement and shall not be given any substantive effect.

  
 Section 7.7 Ambiguities. Neither this Agreement nor any
uncertainty or ambiguity herein shall be construed or resolved using any presumption against any Guarantor or any Guaranteed Party, whether under any rule of construction or otherwise. On the contrary, this Agreement has been reviewed by each
Guarantor and each Guaranteed Party and their respective counsel. In case of any ambiguity or uncertainty, this Agreement shall be construed and interpreted according to the ordinary meaning of the words used to accomplish fairly the purposes and
intentions of all parties hereto. 
  
 Section 7.8
Severability. In case any provision in or obligation under this Agreement shall be invalid, illegal, or unenforceable in any jurisdiction, the validity, legality, and enforceability of the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby. In addition, all agreements and covenants herein shall be given independent effect such that, if a particular action or condition is prohibited
by the terms of any such agreement or covenant, the fact that such action or condition would be permitted by another agreement or covenant shall not be construed as allowing such action to be taken or condition to exist. 
  
 Section 7.9 Counterparts; Telefacsimile Signatures. This Agreement may
be executed in one or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument. Each Guarantor may effect execution and delivery of this Agreement by executing a counterpart
hereof and sending the signature page bearing such Guarantor’s signature to the Administrative Agent by telefacsimile and, thereafter, promptly sending by mail or delivering such signature page to the Administrative Agent; provided that
the failure to deliver such signature page by such Guarantor shall not affect the validity, enforceability, or binding effect of this Agreement against such Guarantor. 
  

 E-6 

 Section 7.10 Entire Agreement. This Agreement and the Credit Agreement embody the entire agreement
and understanding concerning the Guarantors and the Guaranteed Parties relating to the subject matter hereof and supersede all prior agreements and understandings relating to the subject matter hereof. No course of prior dealing between any
Guarantor and the Guaranteed Parties (or any of them), no usage of the trade, and no parol or extrinsic evidence of any nature, shall be used or be relevant to supplement, explain or modify any term used herein. 
  
 ARTICLE VIII 
  
 CERTAIN WAIVERS BY GUARANTORS 
  

EACH GUARANTOR MAKES THE FOLLOWING WAIVERS WITH FULL KNOWLEDGE AND UNDERSTANDING THAT SUCH WAIVERS, IF NOT SO MADE, MIGHT OTHERWISE RESULT IN SUCH
GUARANTOR BEING ABLE TO AVOID OR LIMIT SUCH GUARANTOR’S LIABILITY HEREUNDER EITHER IN WHOLE OR IN PART. 
  
 Section 8.1 Notices. Each Guarantor absolutely, unconditionally, knowingly, and expressly waives: (a) notice of the acceptance by the Guaranteed
Parties of this Agreement; (b) notice of any Loan consisting Guaranteed Obligations; (c) notice of the amount of the Guaranteed Obligations, subject, however, to such Guarantor’s right to make inquiry, at any reasonable time, of any Guaranteed
Party to ascertain the amount of the Guaranteed Obligations owing to such Guaranteed Party; (d) notice of any adverse change in the financial condition of the Company, of any change in value, or the release, of any collateral, or of any other fact
that might increase such Guarantor’s risk hereunder; (e) notice of presentment for payment, demand, protest, and notice thereof as to any instrument; (f) notice of any Default or Event of Default; and (g) all other notices (except if such
notice is expressly required to be given to such Guarantor under this Agreement) and demands to which guarantor might otherwise be entitled. 
  
 Section 8.2 Revocation. Each Guarantor absolutely, unconditionally, knowingly, and expressly waives any right to revoke such Guarantor’s
guaranty obligation hereunder as to future Guaranteed Obligations and, in light thereof, all protection afforded such Guarantor under Section 2815 of the California Civil Code. Each Guarantor fully realizes and understands that, upon execution of
this Agreement, such Guarantor will not have any right to revoke this Agreement as to any future indebtedness and, thus, may have no control over such Guarantor’s ultimate responsibility for the amount and nature of the Guaranteed Obligations.

  
 Section 8.3 Defenses of the Company. Each Guarantor
absolutely, unconditionally, knowingly, and expressly waives any defense arising by reason of any disability or other defense (other than the defense that the Guaranteed Obligations shall have been fully and finally performed and indefeasibly paid)
of the Company or by reason of the cessation from any cause whatsoever (including any act or failure to act by the Company or the Guaranteed Parties) of the liability of the Company in respect thereof, including any such defense or cessation of
liability arising from or as a result of: (a) any statute of limitations; (b) any lack of power or authority of the Company or any Person acting or purporting to act on the Company’s behalf; (c) the operation of Sections 580a, 580b, 580d, or
726 of the California Code of Civil Procedure or any similar law of the State of California or any other jurisdiction; or (d) any claim of fraudulent transfer or preference. 
  
 Section 8.4 Suretyship and Certain Other Rights and Defenses of Guarantors. Each Guarantor absolutely,
unconditionally, knowingly, and expressly waives: 
  
 (a) any
right to assert against the Guaranteed Parties (or any of them) any defense (legal or equitable), set-off, counterclaim, or claim which such Guarantor may now or at any time hereafter have against the Company or any other Person liable to the
Guaranteed Parties (or any of them); 
  

 E-7 

 (b) any defense, set-off, counterclaim, or claim, of any kind or nature, arising directly or indirectly
from the present or future lack of perfection, sufficiency, validity, or enforceability of any of the Guaranteed Obligations or any security therefor or from any failure of the Guaranteed Parties (or any of them) to act in a commercially reasonable
manner; 
  
 (c) any defense arising by reason of or deriving from
any claim or defense based upon an election of remedies by the Guaranteed Parties (or any of them) (including a nonjudicial foreclosure sale of any real property collateral which destroys, diminishes, or otherwise adversely affects any
Guarantor’s rights of subrogation, reimbursement, indemnity, or contribution or other rights against the Company or any other Person), including any defense based upon an election of remedies by any Guaranteed Party under the provisions of
Sections 580a, 580b, 580d, and 726 of the California Code of Civil Procedure or any similar law of the State of California or any other jurisdiction. In making this waiver, each Guarantor specifically acknowledges that it understands and is aware
that, under Sections 580b and 580d of the California Code of Civil Procedure, if the Guaranteed Parties (or any of them) conducted a nonjudicial foreclosure sale of real property collateral: (i) such Guaranteed Party(ies) would lose the right to
pursue the Company for any deficiency that might remain following such sale; (ii) if such Guarantor were to pay such deficiency following such sale, it would be precluded from pursuing the Company for reimbursement; and (iii) as a result, such
Guaranteed Party(ies) would be prevented from pursuing such Guarantor for such deficiency following such sale; 
  
 (d) the benefit of any statute of limitations affecting such Guarantor’s liability hereunder (or the enforcement thereof); 
  
 (e) any defense based on any alteration, impairment, or release of the
Guaranteed Obligations or any security therefor, irrespective of whether resulting from any act or failure to act by the Guaranteed Parties (or any of them); and 
  
 (f) any right to require the Guaranteed Parties (or any of them): (i) to institute suit or otherwise proceed against the
Company or any other Person; or (ii) to exhaust any rights and remedies which the Guaranteed Parties (or any of them) have or may have against the Company or any other Person. 
  
 Section 8.5 Marshalling. Each Guarantor absolutely, unconditionally, knowingly, and expressly waives any rights it
has to require the Guaranteed Parties (or any of them) to marshal, foreclose upon, sell, or otherwise realize upon or collect or apply any particular part of any other assets securing any of the Guaranteed Obligations (including any rights arising
by virtue of Sections 2899 and 3433 of the California Civil Code). 
  
 Section 8.6 Claims Against the Company and Others. Each Guarantor absolutely, unconditionally, knowingly, and expressly agrees that, until the Guaranteed Obligations have been indefeasibly repaid in full, such Guarantor will not in
any manner enforce or pursue, or seek to enforce or pursue, any or all of the following rights (it being expressly agreed that all such rights are subordinate to any claims of the Guaranteed Parties (or any of them)): (a) any right of subrogation,
indemnity, or contribution such Guarantor has or may have as against the Company or any other Person with respect to any of the Guaranteed Obligations; (b) any right to proceed against the Company or any other Person, now or hereafter, for
contribution, indemnity, reimbursement, or any other suretyship rights and claims (irrespective of whether direct or indirect, liquidated or contingent) with respect to any of the Guaranteed Obligations; and (c) any right to proceed or to seek
recourse against or with respect to any assets of the Company or any other Person with respect to any of the Guaranteed Obligations. 
  

 E-8 

 Section 8.7 Certain Additional Statutory Rights. Without limiting the generality of any other
waiver or other provision set forth in this agreement, each Guarantor absolutely, unconditionally, knowingly, and expressly waives any and all benefits or defenses, if any, arising directly or indirectly under any one or more of Sections 2799, 2808,
2809, 2810, 2815, 2819, 2820, 2821, 2822, 2838, 2839, 2845, 2848, 2849, and 2850 of the California Civil Code, Sections 580a, 580b, 580c, 580d, and 726 of the California Code of Civil Procedure, and Sections 3116, 3118, 3119, 3419, 3605, and chapter
6 of Division 9 of the California Uniform Commercial Code. 
  
 ARTICLE IX 
  
 GOVERNING LAW; JURISDICTION AND VENUE;
WAIVER OF TRIAL BY JURY 
  
 Section 9.1 Governing Law.
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAW OF THE STATE OF CALIFORNIA, PROVIDED THAT THE GUARANTEED PARTIES SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW. 
  
 Section 9.2 Jurisdiction. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT
TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF CALIFORNIA OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF CALIFORNIA, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH GUARANTOR AND EACH OF THE
GUARANTEED PARTIES CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THOSE COURTS. EACH GUARANTOR AND EACH OF THE GUARANTEED PARTIES IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF
VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. EACH GUARANTOR AND EACH OF
THE GUARANTEED PARTIES WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY CALIFORNIA LAW. 
  
 Section 9.3. Waiver of Jury Trial. EACH GUARANTOR AND EACH OF THE GUARANTEED PARTIES WAIVES ITS RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER
PARTY OR ANY INDEMNIFIED PERSON, PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. EACH GUARANTOR AND EACH OF THE GUARANTEED PARTIES AGREES THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT
TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN
PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT AND
THE OTHER LOAN DOCUMENTS. 
  

 E-9 

 EACH GUARANTOR WARRANTS AND AGREES THAT EACH OF THE WAIVERS SET FORTH ABOVE IS MADE WITH SUCH
GUARANTOR’S FULL KNOWLEDGE OF ITS SIGNIFICANCE AND CONSEQUENCE AND THAT, UNDER THE CIRCUMSTANCES, THE WAIVERS ARE REASONABLE AND NOT CONTRARY TO PUBLIC POLICY OR LAW. IF ANY SUCH WAIVER IS DETERMINED TO BE CONTRARY TO ANY APPLICABLE LAW OR
PUBLIC POLICY, SUCH WAIVER SHALL BE EFFECTIVE ONLY TO THE EXTENT, BUT TO THE FULLEST EXTENT, PERMITTED BY LAW OR PUBLIC POLICY. 
  
 Each Guarantor acknowledges having read all the provisions of this Agreement and agrees to its terms. In addition, each Guarantor understands that this
Agreement is effective upon such Guarantor’s execution and delivery of this Agreement to the Administrative Agent on behalf of all of the Guaranteed Parties (and the satisfaction of all of the conditions set forth in Section 5.1 of the Credit
Agreement). No formal acceptance by the Guaranteed Parties is necessary to make this Agreement effective. 
  

 E-10 

 IN WITNESS WHEREOF, each Guarantor has executed this Agreement as of the date first written above.

  

			
	[                                      
                                        
      ],
	a
[                                ]
		
	By:	 	                                      
                                        
            
	Name:	 	                                      
                                        
            
	Title:	 	                                      
                                        
            
	
	Notice Information:
	
	                                      
                                        
                         
	                                      
                                        
                         
	                                      
                                        
                         
	Attn:	 	                                      
                                        
            
	Telephone:
        .        .            
	Telefacsimile:
        .        .            

  

 E-11 

 EXHIBIT F 
  

FORM OF TERM COMMITMENT NOTE 
  

			
	 $
                            
	  	_____________

  
 FOR VALUE RECEIVED,
the undersigned (the “Borrower”), hereby promises to pay to the order of
                                     (the
“Lender”) the principal amount of
                                Dollars
($                        ) or such lesser aggregate outstanding principal amount of all Term Commitment Loans (as
defined in the Credit Agreement hereinafter defined) made by the Lender to the Borrower pursuant to that certain Amended and Restated Credit Agreement, dated as of October 15, 2004 (as amended, restated, extended, supplemented or otherwise modified
in writing from time to time, the “Agreement”; capitalized terms used but not otherwise defined herein have the meaning ascribed thereto in the Agreement), among the Borrower, the Lenders from time to time party thereto, Bank of
America, N.A., as Administrative Agent, and Wells Fargo Bank, National Association, as Documentation Agent and Collateral Agent, on the dates and in the amounts and as otherwise provided in the Credit Agreement. 
  
 The Borrower further promises to pay interest on the unpaid principal amount
of each Term Commitment Loan evidenced hereby from the date of the making of such Term Commitment Loan until such principal amount is paid in full, at such interest rates, and at such times as are specified in the Agreement. All payments of
principal and interest shall be made to the Administrative Agent for the account of the Lender in Dollars in immediately available funds at the Administrative Agent’s Office. If any amount is not paid in full when due hereunder, such unpaid
amount shall bear interest, to be paid upon demand, from the due date thereof until the date of actual payment (and before as well as after judgment) computed at the per annum rate set forth in the Agreement. 
  
 This Term Commitment Note (this “Note”) is one of the
“Term Commitment Notes” referred to in the Agreement, is entitled to the benefits thereof and is subject to optional and mandatory prepayment in whole or in part as provided therein. This Note is also entitled to the benefits of the
Guaranties and is secured pursuant to the terms of the Security Documents. Upon the occurrence of one or more of the Events of Default specified in the Agreement, all amounts then remaining unpaid on this Note shall become, or may be declared
to be, immediately due and payable all as provided in the Agreement. Term Commitment Loans made by the Lender shall be evidenced by one or more loan accounts or records maintained by the Lender in the ordinary course of business. The Lender may also
attach schedules to this Note and endorse thereon the date, amount and maturity of its Loans and payments with respect thereto. 
  
 The Borrower, for itself, its successors and assigns, hereby waives diligence, presentment, protest and demand and notice of protest, demand, dishonor and
non-payment of this Note. 
  
 THIS NOTE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW. 
  

			
	 ARTHROCARE CORPORATION

		
	By:	 	  

	Name:	 	  

	Title:	 	  

  

 F-1 

 EXHIBIT 10.45 
 EXECUTED VERSION 
 CUSIP NUMBER:
04313KAD1 
  
 EXHIBIT G 
  
 FORM OF SECURITY AGREEMENT 
  
 SECURITY AGREEMENT 
  
 This SECURITY AGREEMENT (as amended, amended
and restated, supplemented and/or otherwise modified from time to time, this “Agreement”), dated as of
[                                 ], 200[_], is made by
ARTHROCARE CORPORATION, a Delaware corporation (the “Borrower”), and the other parties executing this Agreement under the heading “Debtors” (the Borrower and such other
parties, along with any parties who execute and deliver to the Collateral Agent an agreement substantially in the form attached hereto as Schedule F, being hereinafter referred to collectively as the “Debtors” and
individually as a “Debtor”), and WELLS FARGO BANK, NATIONAL ASSOCIATION, AS COLLATERAL AGENT (for the benefit of the Secured
Creditors (as hereinafter defined)) (“Collateral Agent”). 
  
 R E C I T A L S 
  
 A. The Borrower has previously entered into or is in the process of entering into that certain Credit Agreement, dated as of December 19, 2003 (as
amended, amended and restated, supplemented and/or otherwise modified from time to time, the “Credit Agreement”), among the Borrower, the financial institutions from time to time parties thereto (collectively, the
“Lenders”), Bank of America, N.A., as Administrative Agent, and Wells Fargo Bank, National Association, as Documentation Agent and Collateral Agent, pursuant to which the Lenders have agreed, subject to certain terms and conditions,
to extend various financial accommodations to the Borrower (the Administrative Agent, the Collateral Agent, the Documentation Agent and the Lenders, together with Affiliates of the Lenders with respect to Swap Contracts referred to below are
sometimes hereinafter referred to collectively as the “Secured Creditors” and individually as a “Secured Creditor”). 
  
 B. In addition, one or more of the Debtors may from time to time be liable to the Lenders and/or their Affiliates with respect to Swap Contracts (as such
term is defined in the Credit Agreement). 
  
 C. As a condition to
extending credit to the Borrower under the Credit Agreement, the Secured Creditors have required, among other things, that each Debtor grant to the Collateral Agent for the benefit of the Secured Creditors a lien on and security interest in the
personal property and fixtures of such Debtor described herein subject to the terms and conditions hereof. 
  
 D. Each Debtor will benefit, directly or indirectly, from the financial accommodations extended by the Secured Creditors to the Borrower. 
  
 E. Each Debtor has duly authorized the execution, delivery and performance of
this Agreement. 
  

 G-1 

 NOW THEREFORE, for good and valuable consideration (the receipt and
sufficiency of which are hereby acknowledged), and in order to induce the Lenders to make Loans (including the initial Loans) to the Borrower pursuant to the Credit Agreement, and to induce Secured Creditors to enter into Swap Contracts, the
Borrower agrees, for the benefit of each Secured Creditor, as follows. 
  
 Section 1. Defined Terms. Except as otherwise provided in Section 2 below, each capitalized term used but not otherwise defined herein has the meaning ascribed thereto or provided for in the Credit Agreement. The terms
“Debtor” and “Debtors” as used herein shall mean and include the Debtors collectively and also each individually, with all grants, representations, warranties, and covenants of and by the Debtors, or any of them,
herein contained to constitute joint and several grants, representations, warranties, and covenants of and by the Debtors; provided that, unless the context in which the same is used shall otherwise require, any grant, representation,
warranty or covenant contained herein related to the Collateral shall be made by each Debtor only with respect to the Collateral owned by it or represented by such Debtor as owned by it. 
  
 Section 2. Grant of Security Interest in the Collateral. As collateral security for the Secured Obligations defined
below, each Debtor hereby grants to the Collateral Agent for the benefit of the Secured Creditors a lien on and security interest in, and right of set-off against, and acknowledges and agrees that the Collateral Agent has and shall continue
to have for the benefit of the Secured Creditors a continuing lien on and security interest in, and right of set-off against, all right, title, and interest, whether now owned or existing or hereafter created, acquired or arising, of each Debtor in
and to the following: 
  
 (a) Accounts (including
Health-Care-Insurance Receivables, if any); 
  
 (b) Chattel Paper; 
  
 (c) Instruments
(including Promissory Notes); 
  
 (d) Documents;

  
 (e) (i) all trademarks, trade names,
corporate names, company names, business names, fictitious business names, trade styles, service marks, certification marks, collective marks, logos, other source of business identifiers, prints and labels on which any of the foregoing have appeared
or appear, designs and general intangibles of a like nature (all of the foregoing items in this clause (a) being collectively called a “Trademark”), now existing anywhere in the world or hereafter adopted or acquired, whether
currently in use or not, all registrations and recordings thereof and all applications in connection therewith, whether pending or in preparation for filing, including registrations, recordings and applications in the United States Patent and
Trademark Office or in any office or agency of the United States of America or any State thereof or any foreign country; (ii) all Trademark licenses; (iii) all reissues, extensions or renewals of any of the items described in clauses (i) and (ii);
and (iv) all of the goodwill of the business connected with the use of, and symbolized by the items described in, clauses (i) and (ii); 
  
 (f) General Intangibles (including Payment Intangibles and Software), but, except as otherwise provided in clauses (e) and (p) of this
Section 2, specifically excluding patents, copyrights, and all other intellectual property rights; 
  

 G-2 

 (g) Supporting Obligations; 
  
 (h) Deposit Accounts; 
  
 (i) Inventory; 
  
 (j) Equipment (including all Software, whether or not the
same constitutes embedded software, used in the operation thereof); 
  
 (k) Fixtures; 
  
 (l) Rights to merchandise and other Goods (including rights to returned or repossessed Goods and rights of stoppage in transit) which are represented by, arise from, or relate to any of the foregoing; 
  
 (m) Monies, personal property, and interests in personal
property of such Debtor of any kind or description now held by any Secured Creditor or at any time hereafter transferred or delivered to, or coming into the possession, custody or control of, any Secured Creditor, or any agent or affiliate of any
Secured Creditor, whether expressly as collateral security or for any other purpose (whether for safekeeping, custody, collection or otherwise), and all dividends and distributions on or other rights in connection with any such property; 

 
 (n) Supporting evidence and documents relating to any of
the above-described property, including, without limitation, computer programs, disks, tapes and related electronic data processing media, and all rights of such Debtor to retrieve the same from third parties, written applications, credit
information, account cards, payment records, correspondence, delivery and installation certificates, invoice copies, delivery receipts, notes and other evidences of indebtedness, insurance certificates and the like, together with all books of
account, ledgers, and cabinets in which the same are reflected or maintained; 
  
 (o) Accessions and additions to, and substitutions and replacements of, any and all of the foregoing; and 
  
 (p) Proceeds and products of the foregoing, and all insurance of the foregoing and proceeds thereof; 
  
 all of the foregoing being herein sometimes referred to as the “Collateral.”
Each term used herein that is defined in the Uniform Commercial Code of the State of California as in effect from time to time (“UCC”) shall have the meaning ascribed thereto in the UCC, unless this Agreement shall otherwise
specifically provide. For purposes of this Agreement, the term “Receivables” means all rights to the payment of a monetary obligation, whether or not earned by performance, and whether evidenced by an Account, a Health Care
Insurance Receivable, Chattel Paper, an Instrument, a General Intangible, or otherwise. 
  
 Section 3. Secured Obligations. The lien and security interest granted and provided for herein is made and given to secure, and shall secure, the payment and performance of (a) any and all 
  

 G-3 

 Obligations (whether several, joint or joint and several) owing to the Secured Creditors or any of them and (b) any and
all expenses and charges, legal or otherwise, suffered or incurred by the Collateral Agent and the Secured Creditors (or any of them) in collecting or enforcing any of such Obligations or in realizing on or protecting or preserving any security
therefor, including, without limitation, the lien and security interest granted hereby (all of the foregoing being hereinafter referred to as the “Secured Obligations”). Notwithstanding anything in this Agreement to the contrary,
the right of recovery against any Debtor under this Agreement (other than the Borrower to which this limitation shall not apply) shall not exceed $1.00 less than the lowest amount that would render such Debtor’s obligations under this Agreement
void or voidable under applicable law, including fraudulent conveyance law. 
  
 Section 4. Covenants, Agreements, Representations and Warranties. Each Debtor hereby covenants and agrees with, and represents and warrants to, the Secured Creditors that: 
  
 (a) Each Debtor is duly organized and validly existing in
good standing under the laws of the jurisdiction of its organization. Each Debtor is the sole and lawful owner of its Collateral, and has full right, power, and authority to enter into this Agreement and to perform each and all of the matters and
things herein provided for. The execution and delivery of this Agreement, and the observance and performance of each of the matters and things herein set forth, will not (i) contravene or constitute a default under any provision of law or any
judgment, injunction, order or decree binding upon any Debtor or any provision of any Debtor’s organizational documents (e.g., charter, articles or certificate of incorporation and by-laws, articles or certificate of formation and
limited liability company operating agreement, partnership agreement or similar organizational documents) or any covenant, indenture or agreement of or affecting any Debtor or any of its property or (ii) result in the creation or imposition of any
lien or encumbrance on any property of any Debtor except for the lien and security interest granted to the Collateral Agent hereunder. 
  
 (b) As of the date hereof, each Debtor’s respective chief executive office is at the location listed under Column 2 on Schedule
A attached hereto opposite such Debtor’s name; and such Debtor has no other executive offices or places of business other than those listed under Column 3 on Schedule A attached hereto opposite such Debtor’s name. The Collateral
is and shall remain in such Debtor’s possession or control at the locations listed under Columns 2 and 3 on Schedule A attached hereto opposite such Debtor’s name or at such other locations as such Debtor shall notify the Collateral
Agent as provided below (collectively for each Debtor, the “Permitted Collateral Locations”). If for any reason any Collateral is at any time kept or located at a location other than a Permitted Collateral Location, the
Collateral Agent shall nevertheless have and retain a lien on and security interest therein. The Debtors own and shall continue to own the Permitted Collateral Locations except to the extent otherwise disclosed under Columns 2 and 3 on Schedule
A. No Debtor shall move its chief executive office or maintain a place of business at a location other than those specified under Columns 2 or 3 on Schedule A or permit any Collateral to be located at a location other than a Permitted
Collateral Location, in each case without first providing the Collateral Agent at least thirty (30) days prior written notice of the Debtor’s intent to do so; provided that each Debtor shall at all times maintain its chief executive
office, places of business, and Permitted Collateral Locations in the United States of America and such Debtor shall have taken all action reasonably requested by the Collateral Agent to maintain the lien and security interest of the Collateral
Agent in the Collateral at all times fully perfected and in full force and effect. 
  

 G-4 

 (c) Each Debtor’s legal name, jurisdiction of organization and organizational number
(if any) are correctly set forth under Column 1 on Schedule A of this Agreement. No Debtor has transacted business at any time during the immediately preceding five-year period, and does not currently transact business, under any other legal
names or trade names other than the prior legal names and trade names (if any) set forth on Schedule B attached hereto or such other names as such Debtor shall notify the Collateral Agent as provided below. No Debtor shall change its
jurisdiction of organization without the Collateral Agent’s prior written consent. No Debtor shall change its legal name or transact business under any other trade name without first giving thirty (30) days prior written notice of its intent to
do so to the Collateral Agent. 
  
 (d) The
Collateral and every part thereof is and shall be free and clear of all security interests, liens (including, without limitation, mechanics’, laborers’ and statutory liens), attachments, levies, and encumbrances of every kind, nature, and
description and whether voluntary or involuntary, except for the lien and security interest of the Collateral Agent therein and other Liens permitted by Section 7.1 of the Credit Agreement (herein, the “Permitted Liens”). Each
Debtor shall warrant and defend the Collateral against any claims and demands of all persons at any time claiming the same or any interest in the Collateral adverse to any of the Secured Creditors. 
  
 (e) Each Debtor will promptly pay when due all taxes,
assessments, and governmental charges and levies upon or against it or its Collateral, in each case before the same become delinquent and before penalties accrue thereon, unless and to the extent that the same are being contested in good faith by
appropriate proceedings which prevent attachment of any lien resulting therefrom to, foreclosure on or other realization upon any Collateral and preclude interference with the operation of its business in the ordinary course and such Debtor shall
have established adequate reserves therefor. 
  
 (f) Each Debtor agrees it will not waste or destroy the Collateral or any part thereof and will not be negligent in the care or use of any Collateral. Each Debtor agrees it will not use, manufacture, sell or distribute any Collateral in
violation of any statute, ordinance or other governmental requirement. Each Debtor will perform in all material respects its obligations under any contract or other agreement constituting part of the Collateral where the failure to so perform could
reasonably be expected to have a Material Adverse Effect, it being understood and agreed that the Secured Creditors have no responsibility to perform such obligations. 
  
 (g) Subject to Sections 5(c), 6(a), 7(b), 7(c), and 8(c) hereof and the terms of the Credit Agreement, each
Debtor agrees it will not, without the Collateral Agent’s prior written consent, sell, assign, mortgage, lease, or otherwise dispose of the Collateral or any interest therein. 
  
 (h) Each Debtor will insure its Collateral consisting of tangible personal property against such risks and
hazards as other companies similarly situated insure against, and including in any event loss or damage by fire, theft, burglary, pilferage, and loss in transit, in amounts and 
  

 G-5 

 under policies containing loss payable clauses to the Collateral Agent as its interest may appear (and,
if the Collateral Agent requests, naming the Collateral Agent as additional insureds therein) by insurers reasonably acceptable to the Collateral Agent. All premiums on such insurance shall be paid by the Debtors and the policies of such insurance
(or certificates therefor) delivered to the Collateral Agent. All insurance required hereby shall provide that any loss shall be payable notwithstanding any act or negligence of the relevant Debtor, shall provide that no cancellation thereof shall
be effective until at least thirty (30) days after receipt by the relevant Debtor and the Collateral Agent of written notice thereof, and shall be reasonably satisfactory to the Collateral Agent in all other respects. In case of any material loss,
damage to or destruction of the Collateral or any part thereof, the relevant Debtor shall promptly give written notice thereof to the Collateral Agent generally describing the nature and extent of such damage or destruction. In case of any loss,
damage to or destruction of the Collateral or any part thereof, the relevant Debtor, whether or not the insurance proceeds, if any, received on account of such damage or destruction shall be sufficient for that purpose, at such Debtor’s cost
and expense, will promptly repair or replace the Collateral so lost, damaged or destroyed, except to the extent such Collateral is not necessary to the conduct of such Debtor’s business in the ordinary course. In the event any Debtor shall
receive any proceeds of such insurance, such Debtor shall immediately pay over such proceeds of insurance to the Collateral Agent which will thereafter be applied to the reduction of the Secured Obligations (whether or not then due) or held as
collateral security therefor, as the Collateral Agent may then determine or as otherwise provided for in the Credit Agreement; provided that the Collateral Agent agrees to release such insurance proceeds to the relevant Debtor for replacement
or restoration of the portion of the Collateral lost, damaged or destroyed if, but only if, (i) at the time of release no Default or Event of Default exists, (ii) written application for such release is received by the Collateral Agent from the
relevant Debtor within thirty (30) days of the receipt of such proceeds, and (iii) the Collateral Agent has received evidence reasonably satisfactory to it that the collateral lost, damaged or destroyed has been or will be replaced or restored to
its condition immediately prior to the loss, destruction or other event giving rise to the payment of such insurance proceeds. Each Debtor hereby authorizes the Collateral Agent, at the Collateral Agent’s option, to adjust, compromise, and
settle any losses under any insurance afforded at any time after the occurrence and during the continuation of any Default or Event of Default, and such Debtor does hereby irrevocably constitute the Collateral Agent, its officers, agents, and
attorneys, as such Debtor’s attorneys-in-fact, with full power and authority after the occurrence and during the continuation of any Default or Event of Default to effect such adjustment, compromise, and/or settlement and to endorse any drafts
drawn by an insurer of the Collateral or any part thereof and to do everything necessary to carry out such purposes and to receive and receipt for any unearned premiums due under policies of such insurance. Unless the Collateral Agent elects to
adjust, compromise or settle losses as aforesaid, any adjustment, compromise, and/or settlement of any losses under any insurance shall be made by the relevant Debtor subject to final approval of the Collateral Agent (regardless of whether or not an
Event of Default shall have occurred) in the case of losses exceeding Fifty Thousand Dollars ($50,000.00). All insurance proceeds shall be subject to the lien and security interest of the Collateral Agent hereunder. 
  
 UNLESS THE
DEBTORS PROVIDE THE COLLATERAL AGENT WITH EVIDENCE OF THE INSURANCE COVERAGE
REQUIRED BY THIS AGREEMENT, THE COLLATERAL AGENT MAY PURCHASE INSURANCE AT
THE DEBTORS’ EXPENSE TO PROTECT THE COLLATERAL AGENT’S 
  

 G-6 

 INTERESTS IN THE COLLATERAL.
THIS INSURANCE MAY, BUT NEED NOT, PROTECT ANY DEBTOR’S INTERESTS
IN THE COLLATERAL. THE COVERAGE PURCHASED BY THE COLLATERAL AGENT MAY
NOT PAY ANY CLAIMS THAT ANY DEBTOR MAKES OR ANY CLAIM THAT
IS MADE AGAINST SUCH DEBTOR IN CONNECTION WITH THE COLLATERAL. THE
DEBTORS MAY LATER CANCEL ANY SUCH INSURANCE PURCHASED BY THE COLLATERAL
AGENT, BUT ONLY AFTER PROVIDING THE COLLATERAL AGENT WITH EVIDENCE THAT
THE DEBTORS HAVE OBTAINED INSURANCE AS REQUIRED BY THIS AGREEMENT. IF
THE COLLATERAL AGENT PURCHASES INSURANCE FOR THE COLLATERAL, THE DEBTORS WILL
BE RESPONSIBLE FOR THE COSTS OF THAT INSURANCE, INCLUDING INTEREST AND
ANY OTHER CHARGES THAT THE COLLATERAL AGENT MAY IMPOSE IN CONNECTION
WITH THE PLACEMENT OF THE INSURANCE, UNTIL THE EFFECTIVE DATE OF THE
CANCELLATION OR EXPIRATION OF THE INSURANCE. THE COSTS OF THE INSURANCE
MAY BE ADDED TO THE SECURED OBLIGATIONS SECURED HEREBY. THE COSTS OF
THE INSURANCE MAY BE MORE THAN THE COST OF INSURANCE THE DEBTORS
MAY BE ABLE TO OBTAIN ON THEIR OWN. 
  
 (i) Each Debtor will at all times allow the Secured Creditors and their respective representatives free access to and right of inspection
of the Collateral at such reasonable times and intervals as the Collateral Agent or any other Secured Creditor may designate and, in the absence of any existing Default or Event of Default, with reasonable prior written notice to the relevant
Debtor. 
  
 (j) If any Collateral is in the
possession or control of any agents or processors of a Debtor and the Collateral Agent so requests, such Debtor agrees to notify such agents or processors in writing of the Collateral Agent’s lien and security interest therein and instruct them
to hold all such Collateral for the Collateral Agent’s account and subject to the Collateral Agent’s instructions. Each Debtor will, upon the request of the Collateral Agent, authorize and instruct all bailees and any other parties, if
any, at any time processing, labeling, packaging, holding, storing, shipping or transferring all or any part of the Collateral to permit the Secured Creditors and their respective representatives to examine and inspect any of the Collateral then in
such party’s possession and to verify from such party’s own books and records any information concerning the Collateral or any part thereof which the Secured Creditors or their respective representatives may seek to verify. As to any
premises not owned by a Debtor wherein any of the Collateral is located, if any, such Debtor shall, upon the Collateral Agent’s request, cause each party having any right, title or interest in, or lien on, any of such premises to enter into an
agreement (any such agreement to contain a legal description of such premises) whereby such party disclaims any right, title, and interest in and lien on the Collateral, allows the removal of such Collateral by the Collateral Agent or its agents or
representatives, and otherwise is in form and substance reasonably acceptable to the Collateral Agent. 
  
 (k) Upon the Collateral Agent’s request, each Debtor agrees from time to time to deliver to the Collateral Agent such evidence of the
existence, identity, and location of its Collateral and of its availability as collateral security pursuant hereto (including, without limitation, schedules describing all Receivables created or acquired by such Debtor, copies of customer invoices
or the equivalent and original shipping or delivery receipts for all merchandise and other goods sold or leased or services rendered by it, together with such Debtor’s warranty of the genuineness thereof, and reports stating the book value of
its Inventory and Equipment by major category and location), in each case as the Collateral Agent may reasonably request. The 
  

 G-7 

 Collateral Agent shall have the right to verify all or any part of the Collateral in any manner, and
through any medium, which the Collateral Agent considers appropriate and reasonable, and each Debtor agrees to furnish all assistance and information, and perform any acts, which the Collateral Agent may require in connection therewith. 

 
 (l) Each Debtor will comply in all material respects with
the terms and conditions of any and all leases, easements, right-of-way agreements, and other agreements binding upon such Debtor or affecting the Collateral where the failure to so comply could reasonably be expected to have a Material Adverse
Effect, in each case which cover the premises wherein the Collateral is located, and any orders, ordinances, laws or statutes of any city, state or other governmental entity, department or agency having jurisdiction with respect to such premises or
the conduct of business thereon. 
  
 (m)
Schedule C attached hereto contains a true, complete, and current listing of all Trademarks (including all registrations thereof and applications therefor) owned by each of the Debtors as of the date hereof that are registered with any
governmental authority. The Debtors shall promptly notify the Collateral Agent in writing of any additional Trademarks (including all registrations thereof and applications therefor) acquired or arising after the date hereof and shall submit to the
Collateral Agent a supplement to Schedule C to reflect such additional rights (provided that any Debtor’s failure to do so shall not impair the Collateral Agent’s security interest therein). Each Debtor owns or possesses
rights to use all franchises, licenses, patents, Trademarks, copyrights, and rights with respect to the foregoing which are required to conduct its business. No event has occurred which permits, or after notice or lapse of time or both would permit,
the revocation or termination of any such rights, and the Debtors are not liable to any Person for infringement under applicable law with respect to any such rights as a result of its business operations where such revocation, termination or
infringement could reasonably be expected to have a Material Adverse Effect. 
  
 (n) Each Debtor agrees to execute and deliver to the Collateral Agent such further agreements, assignments, instruments, and documents, and to do all such other things, as the Collateral Agent may reasonably deem
necessary or appropriate to assure the Collateral Agent its lien and security interest hereunder, including, without limitation, (i) such financing statements or other instruments and documents as the Collateral Agent may from time to time
reasonably require to comply with the UCC and any other applicable law, (ii) such agreements with respect to patents, Trademarks (including all registrations thereof and applications therefor), copyrights, and similar intellectual property rights as
the Collateral Agent may from time to time reasonably require to comply with the filing requirements of the United States Patent and Trademark Office and the United States Copyright Office, and (iii) such control agreements with respect to Deposit
Accounts and electronic Chattel Paper, and to cause the relevant depository institutions and issuers to execute and deliver such control agreements, as the Collateral Agent may from time to time reasonably require. Each Debtor hereby agrees that a
carbon, photographic or other reproduction of this Agreement or any such financing statement is sufficient for filing as a financing statement by the Collateral Agent without notice thereof to such Debtor wherever the Collateral Agent in its sole
discretion desires to file the same. Each Debtor hereby authorizes the Collateral Agent to file any and all financing statements covering the Collateral or any part thereof as the Collateral Agent may require, including financing statements
describing the 
  

 G-8 

 Collateral as “all assets” or “all personal property” or words of like meaning. The
Collateral Agent may order lien searches from time to time against any Debtor and the Collateral, and the Debtors shall promptly reimburse the Collateral Agent for all reasonable costs and expenses incurred in connection with such lien searches. In
the event for any reason the law of any jurisdiction other than California becomes or is applicable to the Collateral or any part thereof, or to any of the Secured Obligations, each Debtor agrees to execute and deliver all such agreements,
assignments, instruments, and documents and to do all such other things as the Collateral Agent deems necessary or appropriate to preserve, protect, and enforce the security interest of the Collateral Agent under the law of such other jurisdiction.
Each Debtor agrees to mark its books and records to reflect the lien and security interest of the Collateral Agent in the Collateral. 
  
 (o) On failure of any Debtor to perform any of the covenants and agreements herein contained, the Collateral Agent may, at its option,
perform the same and in so doing may expend such sums as the Collateral Agent deems advisable in the performance thereof, including, without limitation, the payment of any insurance premiums, the payment of any taxes, liens, and encumbrances,
expenditures made in defending against any adverse claims, and all other expenditures which the Collateral Agent may be compelled to make by operation of law or which the Collateral Agent may make by agreement or otherwise for the protection of the
security hereof. All such sums and amounts so expended shall be repayable by the Debtors upon demand, shall constitute additional Secured Obligations secured hereunder, and shall bear interest from the date said amounts are expended at the rate per
annum (computed on the basis of a year of three hundred sixty (360) days for the actual number of days elapsed) equal to the Default Rate applicable to Base Rate Loans (such rate per annum as so determined being hereinafter referred to as the
“Default Rate”). No such performance of any covenant or agreement by the Collateral Agent on behalf of a Debtor, and no such advancement or expenditure therefor, shall relieve any Debtor of any default under the terms of this
Agreement or in any way obligate any Secured Creditor to take any further or future action with respect thereto. The Collateral Agent, in making any payment hereby authorized, may do so according to any bill, statement or estimate procured from the
appropriate public office or holder of the claim to be discharged without inquiry into the accuracy of such bill, statement or estimate or into the validity of any tax assessment, sale, forfeiture, tax lien or title or claim. The Collateral Agent,
in performing any act hereunder, shall be the sole judge of whether the relevant Debtor is required to perform the same under the terms of this Agreement. The Collateral Agent is hereby authorized to charge any account of any Debtor maintained with
any Secured Creditor for the amount of such sums and amounts so expended. 
  
 Section 5. Special Provisions Re: Receivables. (a) As of the time any Receivable owned by a Debtor becomes subject to the security interest provided for hereby, and at all times thereafter, such Debtor shall be
deemed to have warranted as to each such Receivable that all warranties of such Debtor set forth in this Agreement are true and correct with respect to such Receivable; that such Receivable and all papers and documents relating thereto are genuine
and in all respects what they purport to be; that such Receivable is valid and subsisting; that the amount of such Receivable represented as owing is the correct amount actually and unconditionally owing, except for normal cash discounts on normal
trade terms in the ordinary course of business; that the amount of such Receivable represented as owing is not disputed and is not subject to any set-offs, credits, deductions or countercharges other than those arising in the ordinary course of such
Debtor’s business which are disclosed to the Collateral Agent in writing promptly 
  

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 upon such Debtor becoming aware thereof; and, except as disclosed to the Collateral Agent in writing at or prior to the
time such Receivable is created, that no surety bond was required or given in connection with such Receivable or the contracts or purchase orders out of which the same arose. 
  
 (b) If any Receivable arises out of a contract with the United States of America, or any state or political subdivision
thereof, or any department, agency or instrumentality of any of the foregoing, each Debtor agrees to promptly so notify the Collateral Agent and, at the request of the Collateral Agent or the Secured Creditors, execute whatever instruments and
documents are required by the Collateral Agent in order that such Receivable shall be assigned to the Collateral Agent and that proper notice of such assignment shall be given under the federal Assignment of Claims Act (or any successor statute) or
any similar state or local statute, as the case may be. 
  
 (c)
Unless and until an Event of Default has occurred and is continuing any merchandise or other goods which are returned by a customer or account debtor or otherwise recovered may be resold by a Debtor in the ordinary course of its business as
presently conducted in accordance with Section 7(b) hereof; and, during the existence of any Event of Default, such merchandise and other goods shall be set aside at the request of the Collateral Agent and held by the relevant Debtor as trustee for
the Secured Creditors and shall remain part of the Collateral. Unless and until an Event of Default has occurred and is continuing, the Debtors may settle and adjust disputes and claims with its customers and account debtors, handle returns and
recoveries, and grant discounts, credits, and allowances in the ordinary course of its business as presently conducted for amounts and on terms which the relevant Debtor in good faith considers advisable; and, during the existence of any Event of
Default, at the Collateral Agent’s request, the Debtors shall notify the Collateral Agent promptly of all returns and recoveries and, on the Collateral Agent’s request, deliver any such merchandise or other goods to the Collateral Agent.
During the existence of any Event of Default, at the Collateral Agent’s request, the Debtors shall also notify the Collateral Agent promptly of all disputes and claims and settle or adjust them at no expense to the Collateral Agent, but no
discount, credit or allowance other than on normal trade terms in the ordinary course of business as presently conducted shall be granted to any customer or account debtor and no returns of merchandise or other goods shall be accepted by any Debtor
without the Collateral Agent’s consent. The Collateral Agent may, at all times during the existence of any Event of Default, settle or adjust disputes and claims directly with customers or account debtors for amounts and upon terms which the
Collateral Agent considers advisable. 
  
 (d) To the extent any
Receivable or other item of Collateral is evidenced by an Instrument or tangible Chattel Paper, each Debtor shall cause such Instrument or tangible Chattel Paper to be pledged and delivered to the Collateral Agent; provided that, prior to the
existence of a Default or Event of Default and thereafter until otherwise required by the Collateral Agent, a debtor shall not be required to deliver any such Instrument or tangible Chattel Paper if and only so long as the aggregate unpaid principal
balance of all such Instruments and tangible Chattel paper held by the Debtors and not delivered to the Collateral Agent hereunder is less than Ten Thousand Dollars ($10,000.00) at any one time outstanding. Unless delivered to the Collateral Agent
or its agent, all tangible Chattel Paper and Instruments shall contain a legend acceptable to the Collateral Agent indicating that such Chattel Paper or Instrument is subject to the security interest of the Collateral Agent contemplated by this
Agreement. 
  

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 Section 6. Collection of Receivables. (a) Except as otherwise provided in this Agreement, each
Debtor shall make collection of its Receivables and may use the same to carry on its business in accordance with sound business practice and otherwise subject to the terms hereof. 
  
 (b) Upon the occurrence of any Default or Event of Default, whether or not the Collateral Agent has exercised any of its
other rights under other provisions of this Section 6, in the event the Collateral Agent requests any Debtor to do so: 
  
 (i) all Instruments and tangible Chattel Paper at any time constituting part of the Receivables (including any postdated checks) shall,
upon receipt by such Debtor, be immediately endorsed to and deposited with Collateral Agent; and/or 
  
 (ii) such Debtor shall instruct all customers and account debtors to remit all payments in respect of Receivables or any other Collateral
to a lockbox or lockboxes under the sole custody and control of the Collateral Agent and which are maintained at one or more post offices selected by the Collateral Agent. 
  
 (c) Upon the occurrence and during the continuation of any Default or Event of Default, whether or not the Collateral Agent
has exercised any of its other rights under the other provisions of this Section 6, the Collateral Agent or its designee may notify the relevant Debtor’s customers and account debtors at any time that Receivables have been assigned to the
Collateral Agent or of the Collateral Agent’s security interest therein, and either in its own name, or such Debtor’s name, or both, demand, collect (including, without limitation, through a lockbox analogous to that described in Section
6(b)(ii) hereof), receive, receipt for, sue for, compound and give acquittance for any or all amounts due or to become due on Receivables, and in the Collateral Agent’s discretion file any claim or take any other action or proceeding which the
Collateral Agent may deem necessary or appropriate to protect and realize upon the security interest of the Collateral Agent in the Receivables or any other Collateral. 
  
 (d) Any proceeds of Receivables or other Collateral transmitted to or otherwise received by the Collateral Agent pursuant to
any of the provisions of Sections 6(b) or 6(c) hereof may be handled and administered by the Collateral Agent in and through a remittance account or accounts maintained at the Collateral Agent or by the Collateral Agent at a commercial bank or banks
selected by the Collateral Agent (collectively the “Depositary Banks” and individually a “Depositary Bank”), and each Debtor acknowledges that the maintenance of such remittance accounts by the Collateral Agent is
solely for the Collateral Agent’s convenience and that the Debtors do not have any right, title or interest in such remittance accounts or any amounts at any time standing to the credit thereof. The Collateral Agent may, after the occurrence
and during the continuation of any Default or Event of Default, apply all or any part of any proceeds of Receivables or other Collateral received by it from any source to the payment of the Secured Obligations (whether or not then due and payable),
such applications to be made in such amounts, in such manner and order, and at such intervals as the Collateral Agent may from time to time in its discretion determine, but not less often than once each week. The Collateral Agent need not apply or
give credit for any item included in proceeds of Receivables or other Collateral until the Depositary Bank has received final payment therefor at its office in cash or final solvent credits current at the site of deposit acceptable to the Collateral
Agent and the Depositary Bank as such. However, if the Collateral Agent does permit credit to be given for any item prior to a Depositary Bank receiving final payment therefor and such Depositary Bank fails to receive such final payment or an item
is charged back to the 
  

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 Collateral Agent or any Depositary Bank for any reason, the Collateral Agent may at its election in either instance
charge the amount of such item back against any such remittance accounts or any Deposit Account of any Debtor subject to the lien and security interest of this Agreement, together with interest thereon at the Default Rate. Concurrently with each
transmission of any proceeds of Receivables or other Collateral to any such remittance account, upon the Collateral Agent’s request, the relevant Debtor shall furnish the Collateral Agent with a report in such form as Collateral Agent shall
reasonably require identifying the particular Receivable or such other Collateral from which the same arises or relates. Unless and until a Default or an Event of Default has occurred and is continuing, the Collateral Agent will release proceeds of
Collateral which the Collateral Agent has not applied to the Secured Obligations as provided above from the remittance account from time to time after receipt thereof. Each Debtor hereby indemnifies the Secured Creditors from and against all
liabilities, damages, losses, actions, claims, judgments, and all reasonable costs, expenses, charges, and attorneys’ fees suffered or incurred by any Secured Creditor because of the maintenance of the foregoing arrangements; provided
that no Debtor shall be required to indemnify any Secured Creditor for any of the foregoing to the extent they arise solely from the gross negligence or willful misconduct of the person seeking to be indemnified. The Secured Creditors shall have no
liability or responsibility to any Debtor for the Collateral Agent or any Depositary Bank accepting any check, draft or other order for payment of money bearing the legend “payment in full” or words of similar import or any other
restrictive legend or endorsement whatsoever or be responsible for determining the correctness of any remittance. 
  
 Section 7. Special Provisions Re: Inventory and Equipment. (a) Each Debtor shall at its own cost and expense maintain, keep, and preserve its
Inventory in good and merchantable condition and keep and preserve its Equipment in good repair, working order, and condition, ordinary wear and tear excepted, and, without limiting the foregoing, make all necessary and proper repairs, replacements,
and additions to its Equipment so that the efficiency thereof shall be fully preserved and maintained. 
  
 (b) Each Debtor may, until an Event of Default has occurred and is continuing and thereafter until otherwise notified by the Collateral Agent, use,
consume, sell, and lease the Inventory in the ordinary course of its business, but a sale in the ordinary course of business shall not under any circumstance include any transfer or sale in satisfaction, partial or complete, of a debt owing by such
Debtor. 
  
 (c) Each Debtor may, until an Event of Default has
occurred and is continuing and thereafter until otherwise notified by the Collateral Agent, sell Equipment to the extent permitted by the Credit Agreement. 
  
 (d) As of the time any Inventory or Equipment of a Debtor becomes subject to the security interest provided for hereby and at all times thereafter, such
Debtor shall be deemed to have warranted as to any and all of such Inventory and Equipment that all warranties of such Debtor set forth in this Agreement are true and correct with respect to such Inventory and Equipment; and that all of such
Inventory and Equipment is located at a location set forth pursuant to Section 4(b) hereof. Each Debtor warrants and agrees that none of its Inventory is or will be consigned to any other person without the Collateral Agent’s prior written
consent. 
  
 (e) Upon the Collateral Agent’s or the Secured
Creditors’ request, each Debtor shall at its own cost and expense cause the lien of the Collateral Agent in and to any portion of the Collateral subject to a 
  

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 certificate of title law to be duly noted on such certificate of title or to be otherwise filed in such manner as is
prescribed by law in order to perfect such lien and will cause all such certificates of title and evidences of lien to be deposited with the Collateral Agent. 
  

(f) Except for Equipment from time to time located on the real estate described on Schedule D attached hereto or as otherwise hereafter
disclosed to the Collateral Agent and the Secured Creditors in writing, none of the Equipment is or will be attached to real estate in such a manner that the same may become a fixture. 
  
 (g) If any of the Inventory is at any time evidenced by a document of title, such document shall be promptly delivered by
the relevant Debtor to the Collateral Agent. 
  
 Section 8.
Special Provisions Re: Deposits. All Deposit Accounts of the Debtors on the date hereof are listed and identified (by account number and depository institution) on Schedule E attached hereto and made a part hereof. Each Debtor shall
promptly notify the Collateral Agent of any other Deposit Account opened or maintained by such Debtor after the date hereof, and shall submit to the Collateral Agent a supplement to Schedule E to reflect such additional accounts (provided any
Debtor’s failure to do so shall not impair the Collateral Agent’s security interest therein). With respect to any Deposit Account maintained by a depository institution other than the Collateral Agent, and as a condition to the
establishment and maintenance of any such Deposit Account except as otherwise permitted by the Credit Agreement, such Debtor, the depository institution, and the Collateral Agent shall, upon the request of the Collateral Agent, execute and deliver
an account control agreement in form and substance satisfactory to the Collateral Agent which provides, among other things, for the depository institution’s agreement that it will comply with instructions originated by the Collateral Agent
directing the disposition of the funds in the Deposit Account without further consent by such Debtor. 
  
 Section 9. Power of Attorney. In addition to any other powers of attorney contained herein, each Debtor hereby appoints the Collateral
Agent, its nominee, or any other person whom the Collateral Agent may designate as such Debtor’s attorney-in-fact, with full power and authority upon the occurrence and during the continuation of any Event of Default to sign such Debtor’s
name on verifications of Receivables and other Collateral; to send requests for verification of Collateral to such Debtor’s customers, account debtors, and other obligors; to endorse such Debtor’s name on any checks, notes, acceptances,
money orders, drafts, and any other forms of payment or security that may come into the Collateral Agent’s possession; to endorse the Collateral in blank or to the order of the Collateral Agent or its nominee; to sign such Debtor’s name on
any invoice or bill of lading relating to any Collateral, on claims to enforce collection of any Collateral, on notices to and drafts against customers and account debtors and other obligors, on schedules and assignments of Collateral, on notices of
assignment and on public records; to notify the post office authorities to change the address for delivery of such Debtor’s mail to an address designated by the Collateral Agent; to receive, open, and dispose of all mail addressed to such
Debtor; and to do all things necessary to carry out this Agreement. Each Debtor hereby ratifies and approves all acts of any such attorney and agrees that neither the Collateral Agent nor any such attorney will be liable for any acts or omissions
nor for any error of judgment or mistake of fact or law other than such person’s gross negligence or willful misconduct. The Collateral Agent may file one or more financing statements disclosing its security interest in all or any part of the
Collateral without any Debtor’s signature appearing thereon, and each Debtor also hereby grants the Collateral Agent a power of attorney to execute any such financing statements, and amendments and supplements thereto, on behalf of 

 

 G-13 

 such Debtor without notice thereof to any Debtor. The foregoing powers of attorney, being coupled with an interest, are
irrevocable until the Secured Obligations have been fully paid and satisfied and the commitments of the Lenders to extend credit to or for the account of the Borrower under the Credit Agreement have expired or otherwise terminated. 
  
 Section 10. Defaults and Remedies. (a) The occurrence of any event or
the existence of any condition which is specified as an “Event of Default” under the Credit Agreement shall constitute an “Event of Default” hereunder. 
  
 (b) Upon the occurrence and during the continuation of any Event of Default, the Collateral Agent shall have, in addition to
all other rights provided herein or by law, the rights and remedies of a secured party under the UCC (regardless of whether the UCC is the law of the jurisdiction where the rights or remedies are asserted and regardless of whether the UCC applies to
the affected Collateral), and further the Collateral Agent may, without demand and, to the extent permitted by applicable law, without advertisement, notice, hearing or process of law, all of which each Debtor hereby waives to the extent permitted
by applicable law, at any time or times, sell and deliver any or all Collateral held by or for it at public or private sale, at any securities exchange or broker’s board or at the Collateral Agent’s office or elsewhere, for cash, upon
credit or otherwise, at such prices and upon such terms as the Collateral Agent deems advisable, in its reasonable discretion and subject to applicable law. In the exercise of any such remedies, the Collateral Agent may sell the Collateral as a unit
even though the sales price thereof may be in excess of the amount remaining unpaid on the Secured Obligations. Also, if less than all the Collateral is sold, the Collateral Agent shall have no duty to marshal or apportion the part of the Collateral
so sold as between the Debtors, or any of them, but may sell and deliver any or all of the Collateral without regard to which of the Debtors are the owners thereof. In addition to all other sums due any Secured Creditor hereunder, each Debtor shall
pay the Secured Creditors all costs and expenses incurred by the Secured Creditors, including reasonable attorneys’ fees and court costs, in obtaining, liquidating or enforcing payment of Collateral or the Secured Obligations or in the
prosecution or defense of any action or proceeding by or against any Secured Creditor or any Debtor concerning any matter arising out of or connected with this Agreement or the Collateral or the Secured Obligations, including, without limitation,
any of the foregoing arising in, arising under or related to a case under the Bankruptcy Code. Any requirement of reasonable notice shall be met if such notice is personally served on or mailed, postage prepaid, to the Debtors in accordance with
Section 14(b) hereof at least ten (10) days before the time of sale or other event giving rise to the requirement of such notice; provided no notification need be given to a Debtor if such Debtor has signed, after an Event of Default
hereunder has occurred, a statement renouncing any right to notification of sale or other intended disposition. The Collateral Agent shall not be obligated to make any sale or other disposition of the Collateral regardless of notice having been
given. To the extent permitted by applicable law, each Secured Creditor may be the purchaser at any such sale. Each Debtor hereby waives all of its rights of redemption from any such sale. The Collateral Agent may postpone or cause the postponement
of the sale of all or any portion of the Collateral by announcement at the time and place of such sale, and such sale may, without further notice, be made at the time and place to which the sale was postponed or the Collateral Agent may further
postpone such sale by announcement made at such time and place. The Collateral Agent has no obligation to prepare the Collateral for sale. The Collateral Agent may sell or otherwise dispose of the Collateral without giving any warranties as to the
Collateral or any part thereof to the extent permitted by applicable law, including disclaimers of any warranties of title or the like, and each Debtor acknowledges and agrees that the absence of such warranties shall not render the disposition
commercially unreasonable. 
  

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 (c) Without in any way limiting the foregoing, upon the occurrence and during the continuation of any
Event of Default hereunder, in addition to all other rights provided herein or by law, (i) the Collateral Agent shall have the right to take physical possession of any and all of the Collateral and anything found therein, the right for that purpose
to enter without legal process any premises where the Collateral may be found (provided such entry be done lawfully), and the right to maintain such possession on the relevant Debtor’s premises (each Debtor hereby agreeing, to the extent it may
lawfully do so, to lease such premises without cost or expense to the Collateral Agent or its designee if the Collateral Agent so requests) or to remove the Collateral or any part thereof to such other places as the Collateral Agent may desire, (ii)
the Collateral Agent shall have the right to direct any intermediary at any time holding any Investment Property or other Collateral, or any issuer thereof, to deliver such Collateral or any part thereof to the Collateral Agent and/or to liquidate
such Collateral or any part thereof and deliver the proceeds thereof to the Collateral Agent (including, without limitation, the right to deliver a notice of control with respect to any Collateral held in a securities account or commodities account
and deliver all entitlement orders with respect thereto), (iii) the Collateral Agent shall have the right to exercise any and all rights with respect to all Deposit Accounts of each Debtor, including, without limitation, the right to direct the
disposition of the funds in each Deposit Account and to collect, withdraw, and receive all amounts due or to become due or payable thereunder, and (iv) each Debtor shall, upon the Collateral Agent’s demand, promptly assemble the Collateral and
make it available to the Collateral Agent at a place reasonably designated by the Collateral Agent and reasonably convenient to the applicable Debtor and the Collateral Agent. If the Collateral Agent exercises its right to take possession of the
Collateral, each Debtor shall also at its expense perform any and all other steps requested by the Collateral Agent to preserve and protect the security interest hereby granted in the Collateral, such as placing and maintaining signs indicating the
security interest of the Collateral Agent, appointing overseers for the Collateral and maintaining Collateral records. 
  
 (d) Without in any way limiting the foregoing, upon the occurrence and during the continuation of any Event of Default, all rights of the Debtors to
exercise the voting and/or consensual powers which they are entitled to exercise pursuant to Section 8(a)(i) hereof and/or to receive and retain the distributions which they are entitled to receive and retain pursuant to Section 8(a)(ii) hereof,
shall, at the option of the Collateral Agent and upon notice to the applicable Debtor unless the giving of notice is prohibited by applicable law, cease and thereupon become vested in the Collateral Agent, which, in addition to all other rights
provided herein or by law, shall then be entitled solely and exclusively to exercise all voting and other consensual powers pertaining to the Investment Property and/or to receive and retain the distributions which such Debtor would otherwise have
been authorized to retain pursuant to Section 8(a)(ii) hereof and shall then be entitled solely and exclusively to exercise any and all rights of conversion, exchange or subscription or any other rights, privileges or options pertaining to any
Investment Property as if the Collateral Agent were the absolute owner thereof including, without limitation, the rights to exchange, at its discretion, all Investment Property or any part thereof upon the merger, consolidation, reorganization,
recapitalization or other readjustment of the respective issuer thereof or upon the exercise by or on behalf of any such issuer or the Collateral Agent of any right, privilege or option pertaining to any Investment Property and, in connection
therewith, to deposit and deliver the Investment Property or any part thereof with any committee, depositary, transfer agent, registrar or other designated agency upon such terms and conditions as the Collateral Agent may determine. In the event the
Collateral Agent in good faith believes any of the Collateral constitutes restricted securities within the meaning of any applicable securities laws, any disposition thereof in compliance with such laws shall not render the disposition commercially
unreasonable. 
  

 G-15 

 (e) Without in any way limiting the foregoing, each Debtor hereby grants to the Secured Creditors a
royalty-free irrevocable license and right to use all of such Debtor’s patents, patent applications, patent licenses, Trademarks (including all registrations thereof and applications therefor), Trademark licenses, and similar intangibles in
connection with any foreclosure or other realization by the Collateral Agent or the Secured Creditors on all or any part of the Collateral to the extent permitted by law. The license and right granted the Secured Creditors hereby shall be without
any royalty or fee or charge whatsoever. 
  
 (f) The powers
conferred upon the Secured Creditors hereunder are solely to protect their interest in the Collateral and shall not impose on them any duty to exercise such powers. The Collateral Agent shall be deemed to have exercised reasonable care in the
custody and preservation of the Collateral in its possession or control if such Collateral is accorded treatment substantially equivalent to that which the Collateral Agent accords its own property, consisting of similar type assets, it being
understood, however, that the Collateral Agent shall have no responsibility for (i) ascertaining or taking any action with respect to calls, conversions, exchanges, maturities, tenders or other matters relating to any Collateral, whether or not the
Collateral Agent has or is deemed to have knowledge of such matters, (ii) taking any necessary steps to preserve rights against any parties with respect to any Collateral, or (iii) initiating any action to protect the Collateral or any part thereof
against the possibility of a decline in market value. This Agreement constitutes an assignment of rights only and not an assignment of any duties or obligations of the Debtors in any way related to the Collateral, and the Collateral Agent shall have
no duty or obligation to discharge any such duty or obligation. Neither any Secured Creditor nor any party acting as attorney for any Secured Creditor shall be liable for any acts or omissions or for any error of judgment or mistake of fact or law
other than such person’s gross negligence or willful misconduct. 
  
 (g) Failure by the Collateral Agent to exercise any right, remedy or option under this Agreement or any other agreement between any Debtor and the Collateral Agent or provided by law, or delay by the Collateral Agent in exercising the same,
shall not operate as a waiver; and no waiver shall be effective unless it is in writing, signed by the party against whom such waiver is sought to be enforced and then only to the extent specifically stated. The rights and remedies of the Secured
Creditors under this Agreement shall be cumulative and not exclusive of any other right or remedy which any Secured Creditor may have. For purposes of this Agreement, an Event of Default shall be construed as continuing after its occurrence until
the same is waived in writing by the Collateral Agent. 
  
 Section 11. Application of Proceeds. The proceeds and avails of the Collateral at any time received by the Collateral Agent upon the occurrence and during the continuation of any Event of Default shall, when received by the
Collateral Agent in cash or its equivalent, be applied by the Collateral Agent in reduction of, or held as collateral security for, the Secured Obligations in accordance with the terms of the Credit Agreement. The Debtors shall remain liable to the
Secured Creditors for any deficiency. Any surplus remaining after the full payment and satisfaction of the Secured Obligations shall be returned to the Borrower, as agent for the Debtors, or to whomsoever the Collateral Agent reasonably determines
is lawfully entitled thereto. 
  
 Section 12. Continuing
Agreement. This Agreement shall be a continuing agreement in every respect and shall remain in full force and effect until all of the Secured Obligations, both for principal and interest, have been fully paid and satisfied and the commitments of
the Lenders to extend credit to or for 
  

 G-16 

 the account of the Borrower under the Credit Agreement have expired or otherwise terminated. Upon such termination of
this Agreement, the Collateral Agent shall, upon the request and at the expense of the Debtors, forthwith release its liens and security interests hereunder. 
  
 Section 13. The Collateral Agent. In acting under or by virtue of this Agreement, the Collateral Agent shall be entitled to all the rights,
authority, privileges, and immunities provided in the Credit Agreement, all of which provisions of said Credit Agreement (including, without limitation, Section 11 thereof) are incorporated by reference herein with the same force and effect as if
set forth herein in their entirety. The Collateral Agent hereby disclaims any representation or warranty to the Secured Creditors or any other holders of the Secured Obligations concerning the perfection of the liens and security interests granted
hereunder or in the value of any of the Collateral. 
  
 Section
14. Miscellaneous. (a) This Agreement cannot be changed or terminated orally. This Agreement shall create a continuing lien on and security interest in the Collateral and shall be binding upon each Debtor, its successors and assigns and shall
inure, together with the rights and remedies of the Secured Creditors hereunder, to the benefit of the Secured Creditors and their successors and permitted assigns; provided that no Debtor may assign its rights or delegate its duties
hereunder without the Collateral Agent’s prior written consent. Without limiting the generality of the foregoing, and subject to the provisions of the Credit Agreement, any Lender may assign or otherwise transfer any indebtedness held by it
secured by this Agreement to any other person, and such other person shall thereupon become vested with all the benefits in respect thereof granted to such Lender herein or otherwise. 
  
 (b) Except as otherwise specified herein, all notices hereunder shall be given in the manner and to the place specified for
notices in the Credit Agreement. 
  
 (c) In the event and to the
extent that any provision hereof shall be deemed to be invalid or unenforceable by reason of the operation of any law or by reason of the interpretation placed thereon by any court, this Agreement shall to such extent be construed as not containing
such provision, but only as to such jurisdictions where such law or interpretation is operative, and the invalidity or unenforceability of such provision shall not affect the validity of any remaining provisions hereof, and any and all other
provisions hereof which are otherwise lawful and valid shall remain in full force and effect. Without limiting the generality of the foregoing, in the event that this Agreement shall be deemed to be invalid or otherwise unenforceable with respect to
any Debtor, such invalidity or unenforceability shall not affect the validity of this Agreement with respect to the other Debtors. 
  
 (d) The lien and security interest herein created and provided for stand as direct and primary security for the Secured Obligations of the Borrower
arising under or otherwise relating to the Credit Agreement as well as for the other Secured Obligations secured hereby. No application of any sums received by the Secured Creditors in respect of the Collateral or any disposition thereof to the
reduction of the Secured Obligations or any part thereof shall in any manner entitle any Debtor to any right, title or interest in or to the Secured Obligations or any collateral or security therefor, whether by subrogation or otherwise, unless and
until all Secured Obligations have been fully paid and satisfied and all commitments to extend credit to or for the account of the Borrower under the Credit Agreement have expired or otherwise terminated. Each Debtor acknowledges and agrees that the
lien and security interest hereby created and provided are absolute and unconditional and shall not in any manner be affected or impaired by any acts of omissions whatsoever of any Secured Creditor or any other holder of any Secured 
  

 G-17 

 Obligations, and without limiting the generality of the foregoing, the lien and security interest hereof shall not be
impaired by any acceptance by any Secured Creditor or any other holder of any Secured Obligations of any other security for or guarantors upon any of the Secured Obligations or by any failure, neglect or omission on the part of any Secured Creditor
or any other holder of any of the Secured Obligations to realize upon or protect any of the Secured Obligations or any collateral or security therefor. The lien and security interest hereof shall not in any manner be impaired or affected by (and the
Secured Creditors, without notice to anyone, are hereby authorized to make from time to time) any sale, pledge, surrender, compromise, settlement, release, renewal, extension, indulgence, alteration, substitution, exchange, change in, modification
or disposition of any of the Secured Obligations or of any collateral or security therefor, or of any guaranty thereof, or of any instrument or agreement setting forth the terms and conditions pertaining to any of the foregoing. The Secured
Creditors may at their discretion at any time grant credit to the Borrower without notice to the other Debtors in such amounts and on such terms as the Secured Creditors may elect without in any manner impairing the lien and security interest
created and provided for. In order to realize hereon and to exercise the rights granted the Secured Creditors hereunder and under applicable law, there shall be no obligation on the part of any Secured Creditor or any other holder of any Secured
Obligations at any time to first resort for payment to the Borrower or any other Debtor or to any guaranty of the Secured Obligations or any portion thereof or to resort to any other collateral, security, property, liens or any other rights or
remedies whatsoever, and the Secured Creditors shall have the right to enforce this Agreement against any Debtor or its Collateral irrespective of whether or not other proceedings or steps seeking resort to or realization upon or from any of the
foregoing are pending. 
  
 (e) In the event the Secured Creditors
shall at any time in their discretion permit a substitution of Debtors hereunder or a party shall wish to become a Debtor hereunder, such substituted or additional Debtor shall, upon executing an agreement in the form attached hereto as Schedule
F, become a party hereto and be bound by all the terms and conditions hereof to the same extent as though such Debtor had originally executed this Agreement and, in the case of a substitution, in lieu of the Debtor being replaced. Any such
agreement shall contain information as to such Debtor necessary to update Schedules A, B, C, D and E hereto with respect to it. No such substitution shall be effective absent the written consent of the Collateral Agent nor shall it in any
manner affect the obligations of the other Debtors hereunder. 
  
 (f) This Agreement may be executed in any number of counterparts and by different parties hereto on separate counterpart signature pages, each constituting an original, but all together one and the same instrument. Each Debtor acknowledges
that this Agreement is and shall be effective upon its execution and delivery by such Debtor to the Collateral Agent, and it shall not be necessary for the Collateral Agent to execute this Agreement or any other acceptance hereof or otherwise to
signify or express its acceptance hereof. 
  
 (g) The headings in
this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning of any provision hereof. 
  
 (h) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT THE COLLATERAL AGENT SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW. 
  

 G-18 

 (g) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN THE COURTS OF THE
STATE OF CALIFORNIA SITTING IN THE CITY AND COUNTY OF SAN FRANCISCO, CALIFORNIA OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF SUCH STATE, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE PARTIES HERETO CONSENTS, FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT
MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY OTHER DOCUMENT RELATED HERETO. EACH OF THE PARTIES HERETO WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER
PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE. 
  
 (h) EACH OF THE PARTIES HERETO HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL
TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO THIS AGREEMENT OR ANY OTHER DOCUMENT RELATING HERETO, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT
OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF
THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY. 
  
 (i) The Collateral Agent (for itself and not on behalf of any other Person, including any Secured Creditor) hereby notifies each Debtor that, pursuant to
the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies each Debtor, which information includes the name and address of each Debtor and other information that will allow the Collateral Agent to
identify each Debtor in accordance with the Patriot Act. 
  
 (j)
Time is of the essence of this Agreement. 
  
 (k) This Agreement
is a Loan Document executed pursuant to the Credit Agreement and shall (unless otherwise expressly indicated herein) be construed, administered and applied in accordance with the terms and provisions of the Credit Agreement. 
  
 [SIGNATURE PAGE TO
FOLLOW] 
  

 G-19 

 EXHIBIT 10.45 
 EXECUTED VERSION 
 CUSIP NUMBER:
04313KAD1 
  
 IN WITNESS
WHEREOF, each Debtor has caused this Security Agreement to be duly executed and delivered as of the date first written above. 
  

			
	 “DEBTORS”

	
	 ARTHROCARE CORPORATION, A DELAWARE
CORPORATION

		
	 By
	 	  

	 Name
	 	 
	 Title
	 	 

  
 Accepted and
agreed to in San Francisco, California, as of the date first written above. 
  

			
	 WELLS FARGO BANK, NATIONAL ASSOCIATION,
AS COLLATERAL AGENT

		
	 By
	 	  

	 Name
	 	 
	 Title
	 	 

  
 artc - amended & restated
credit facitlity (10_15_04) w_redactions for EDGAR(434520_2_SV)_20041108-2316-33B59B32 
  

 G-20 

 SCHEDULE A 
  
 LOCATIONS 
  

					
	 COLUMN 1

	  	 COLUMN 2

	  	 COLUMN 3

	NAME OF DEBTOR (AND STATE OF ORGANIZATION AND
ORGANIZATIONAL REGISTRATION NUMBER)	  	CHIEF EXECUTIVE OFFICE (AND NAME OF RECORD OWNER OF
SUCH LOCATION)	  	ADDITIONAL PLACES OF BUSINESS AND COLLATERAL LOCATIONS (AND
NAME OF RECORD OWNER OF SUCH LOCATION IF SUCH LOCATION IS OWNED
BY BORROWER OR ONE OF ITS SUBSIDIARIES)
	ArthroCare Corporation (Delaware, 2554294)	  	 680 Vaqueros Avenue
 Sunnyvale, CA
94085
	  	Costa Rica (ArthroCare Costa Rica SRL)
	 	  	 	  	Sweden
			
	 	  	 	  	United Kingdom
			
	 	  	 	  	Cincinnati, Ohio (DHL Logistics (as a third party logistics service provider))
	 	  	 	  	Brussels, Belgium (DHL; logistics service provider for Europe)
	 	  	 	  	111 Congress Avenue, Austin TX (future headquarters for ArthroCare Corporation – to be moved by December 2004)

	

  

 SCHEDULE B 
  
 OTHER NAMES 

	A.	PRIOR LEGAL NAMES 

  
 ArthroCare Corporation, a California corporation. 
  
 AngioCare Corporation, a California corporation. 
  

	B.	TRADE NAMES 

  
 ArthroCare Corp.; ArthroCare; Atlantech; Parallax 

 SCHEDULE C 
  
 INTELLECTUAL PROPERTY RIGHTS 
  

	ITEM	A. TRADEMARKS 

  

							
	REGISTERED TRADEMARKS
	COUNTRY

	 	TRADEMARK

	 	REGISTRATION
NO.

	 	REGISTRATION
DATE

	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	
	PENDING TRADEMARK APPLICATIONS
	COUNTRY

	 	TRADEMARK

	 	SERIAL NO.

	 	FILING DATE

	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 

 TRADEMARK APPLICATIONS IN PREPARATION

  

											
	 COUNTY

	  	TRADEMARK

	  	DOCKET
NO.

	  	FILING
DATE

	  	EXPECTED
SERVICES

	  	PRODUCTS

	 NONE.
	  	 	  	 	  	 	  	 	  	 

  

	ITEM	B TRADEMARK LICENSES 

  

											
	 COUNTY OR TERRITORY

	  	TRADEMARK

	  	LICENSOR

	  	LICENSEE

	  	EFFECTIVE
DATE

	  	EXPIRATION
DATE

	 NONE.
	  	 	  	 	  	 	  	 	  	 

 SCHEDULE D 
  
 REAL ESTATE LEGAL DESCRIPTIONS 
  
 Factory and warehouse located in Heredia, Costa Rica. 
  

 SCHEDULE E 
  
 DEPOSITS 
  
 There are various security deposits throughout domestics and international operations, mainly for rent contracts. The total value for the United States is
Three hundred and fifty thousand United States dollars ($ 350,000.00). Among international entities, the total value does not exceed One Hundred Thousand United States Dollars (US$100,000.00) in the aggregate. 
  

 SCHEDULE F 
  
 ASSUMPTION AND SUPPLEMENTAL SECURITY AGREEMENT

  
 This ASSUMPTION AND
SUPPLEMENTAL SECURITY AGREEMENT (as amended, amended and restated, supplemented and/or otherwise modified from time to time, this “Agreement”), dated as of
[                                      ],
200[_], is made by [new Debtor], a                          [corporation/limited liability company/partnership]
(the “New Debtor”), to WELLS FARGO BANK, NATIONAL ASSOCIATION, AS COLLATERAL AGENT (for the benefit of the Secured
Creditors (as defined in the Security Agreement hereinafter referred to)). 
  
 R E C I T A L S 
  

A. ArthroCare Corporation, a Delaware corporation (the “Borrower”), has previously executed and delivered to the Collateral Agent that
certain Security Agreement, dated as of December 19, 2003 (as amended, amended and restated, supplemented (including by way of supplements thereto that add additional parties as “Debtors” thereunder) and/or otherwise modified from
time to time, the “Security Agreement”), pursuant to which the Borrower and, as applicable, various other parties (individually and collectively, the “Existing Debtors”) have granted to the Collateral Agent for the
benefit of the Secured Creditors a lien on and security interest in the Collateral (as such term is defined in the Security Agreement) to secure the Secured Obligations (as such term is defined in the Security Agreement). 
  
 B. The Borrower provides the New Debtor with substantial financial,
managerial, administrative, and technical support and the New Debtor will benefit, directly and indirectly, from credit and other financial accommodations extended by the Secured Creditors to the Borrower. 
  
 NOW, THEREFORE, for good and valuable
consideration (the receipt and sufficiency of which are hereby acknowledged), and in consideration of the financial accommodations made or to be made to the Borrower by the Secured Creditors from time to time, the New Debtor hereby agrees as
follows: 
  
 1. The New Debtor acknowledges and agrees that it
shall become a “Debtor” party to the Security Agreement effective upon the date the New Debtor’s execution of this Agreement and the delivery of this Agreement to the Collateral Agent, and that upon such execution and delivery,
all references in the Security Agreement to the terms “Debtor” or “Debtors” shall be deemed to include the New Debtor. Without limiting the generality of the foregoing, the New Debtor hereby repeats and reaffirms all grants
(including the grant of a lien and security interest), covenants, agreements, representations, and warranties contained in the Security Agreement as amended hereby, each and all of which are and shall remain applicable to the Collateral from time to
time owned by the New Debtor or in which the New Debtor from time to time has any rights. Without limiting the foregoing, in order to secure payment of the Secured Obligations, whether now existing or hereafter arising, the New Debtor does hereby
grant to the Collateral Agent for the benefit of the Secured Creditors, and hereby agrees that the Collateral Agent has and shall continue to have for the benefit of the Secured Creditors a continuing lien on and security interest in, among other
things, all of the New Debtor’s Collateral (as such term is defined in the Security Agreement), including, without limitation, all of the New Debtor’s Accounts, Chattel Paper, Instruments, Documents, General Intangibles Supporting
Obligations, Deposit Accounts, 

 Inventory, Equipment, Fixtures, and all of the other Collateral described in Section 2 of the Security Agreement, each
and all of such granting clauses being incorporated herein by reference with the same force and effect as if set forth herein in their entirety except that all references in such clauses to the Existing Debtors or any of them shall be deemed to
include references to the New Debtor. Nothing contained herein shall in any manner impair the priority of the liens and security interests heretofore granted in favor of the Collateral Agent under the Security Agreement. 
  
 2. Schedule A (Locations), Schedule B (Other Names), Schedule C
(Intellectual Property Rights), Schedule D (Real Estate) and Schedule E (Deposits) to the Security Agreement shall be supplemented by the information stated below with respect to the New Debtor: 
  
 SUPPLEMENT TO SCHEDULE A

  

					
	 NAME OF DEBTOR
 (AND STATE OF
 ORGANIZATION AND
 ORGANIZATIONAL
 REGISTRATION NUMBER)

	 	 CHIEF EXECUTIVE OFFICE
(AND NAME OF RECORD OWNER OF
SUCH
LOCATION)

	 	 ADDITIONAL PLACES OF
BUSINESS AND COLLATERAL LOCATIONS (AND
NAME
OF RECORD OWNER OF SUCH LOCATIONS)

	___________________	 	___________________	 	___________________
	___________________	 	___________________	 	___________________

  
 SUPPLEMENT TO SCHEDULE B 
  

			
	 NAME OF DEBTOR

	 	 PRIOR LEGAL NAMES AND TRADE
NAMES OF SUCH DEBTOR

	 ___________________
	 	___________________

  

	
	SUPPLEMENT TO SCHEDULE C
	
	INTELLECTUAL PROPERTY RIGHTS
	________________________
	________________________

  

 -2- 

 SUPPLEMENT TO SCHEDULE D 
  
 REAL ESTATE LEGAL
DESCRIPTIONS 
  

  

  
 SUPPLEMENT
TO SCHEDULE E 
  
 DEPOSITS 
  

  

  
 3. The New Debtor hereby acknowledges and agrees that the Secured Obligations are secured by all of the Collateral according to, and otherwise on and subject to, the terms and conditions of the Security Agreement to the same extent and with
the same force and effect as if the New Debtor had originally been one of the Existing Debtors under the Security Agreement and had originally executed the same as such an Existing Debtor. 
  
 4. Each capitalized term used but not otherwise defined in this Agreement has
the meaning ascribed thereto in the Security Agreement, provided that any reference to the term “Debtor” or “Debtors” and any provision of the Security Agreement providing meaning to such terms shall be deemed a reference
to the Existing Debtors and the New Debtor. Except as specifically modified hereby, all of the terms and conditions of the Security Agreement shall remain unchanged and in full force and effect. 
  
 5. The New Debtor agrees to execute and deliver such further instruments and
documents and do such further acts and things as the Collateral Agent may deem necessary or proper to carry out more effectively the purposes of this Agreement. 
  

6. No reference to this Agreement need be made in the Security Agreement or in any other document or instrument making reference to the Security
Agreement, any reference to the Security Agreement in any of such to be deemed a reference to the Security Agreement as modified hereby. 
  
 7. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT THE COLLATERAL AGENT SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW. 
  

 -3- 

 IN WITNESS WHEREOF, the New Debtor has caused this Agreement
to be duly executed and delivered the day and year first written above. 
  

			
	 [INSERT NAME OF NEW DEBTOR]

		
	By	 	  

	 Name
	 	 
	 Title
	 	 

  
 Accepted and
agreed to as of the date first written above. 
  

			
	WELLS FARGO BANK, NATIONAL ASSOCIATION,
AS COLLATERAL
AGENT
		
	By	 	  

	 Name
	 	 
	 Title
	 	 

  

 -4- 

 EXHIBIT H 
  

FORM OF TRADEMARK SECURITY AGREEMENT 
  
 TRADEMARK SECURITY AGREEMENT 
  
 This TRADEMARK SECURITY AGREEMENT (as amended, amended and restated,
supplemented and/or otherwise modified from time to time, this “Agreement”), dated as of [                     ],
200[    ], is between ARTHROCARE CORPORATION, a Delaware corporation (the “Grantor”), and WELLS FARGO BANK,
NATIONAL ASSOCIATION, AS COLLATERAL AGENT (for the benefit of the Secured Creditors (as hereinafter defined)) (“Collateral Agent”). 
  
 R E C I T
A L S 
  
 A. The
Grantor has previously entered into or is in the process of entering into that certain Credit Agreement, dated as of December 19, 2003 (as amended, amended and restated, supplemented and/or otherwise modified from time to time, the “Credit
Agreement”), among the Grantor, the financial institutions from time to time parties thereto (collectively, the “Lenders”), Bank of America, N.A., as Administrative Agent, and Wells Fargo, as Documentation Agent and
Collateral Agent, pursuant to which the Lenders have agreed, subject to certain terms and conditions, to extend various financial accommodations to the Grantor (the Administrative Agent, the Collateral Agent, the Documentation Agent and the Lenders,
together with Affiliates of the Lenders with respect to Swap Contracts referred to below are sometimes hereinafter referred to collectively as the “Secured Creditors” and individually as a “Secured Creditor”). In
connection with the transactions contemplated by the Credit Agreement, the Grantor has previously entered into or is in the process of entering into that certain Security Agreement, dated as of December 19, 2003 (as amended, amended and restated,
supplemented and/or otherwise modified from time to time, the “Security Agreement”), among the debtors (including the Grantor) named therein and the Collateral Agent. 
  
 B. In addition, the Grantor may from time to time be liable to the Lenders and/or their Affiliates with respect to Swap
Contracts (as such term is defined in the Credit Agreement). 
  
 C. As a condition to extending credit to the Grantor under the Credit Agreement, the Secured Creditors have required, among other things, that the Grantor grant to the Collateral Agent for the benefit of the Secured Creditors a lien on and
security interest in the personal property and fixtures of the Grantor described herein subject to the terms and conditions hereof. 
  
 D. The Grantor will benefit, directly or indirectly, from the financial accommodations extended by the Secured Creditors to the Grantor. 
  
 E. The Grantor has duly authorized the execution, delivery and performance of
this Agreement. 
  
 NOW THEREFORE,
for good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), and in order to induce the Lenders to make Loans (including the initial Loans) to the Grantor pursuant to the Credit Agreement, and to induce Secured
Creditors to enter into Swap Contracts, the Grantor agrees, for the benefit of each Secured Creditor, as follows. 

 Section 1. Definitions. Unless the context otherwise requires, each capitalized term used but not
otherwise defined herein has the meaning ascribed thereto or otherwise provided for in the Security Agreement. 
  
 Section 2. Grant of Security Interest. For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, to secure
all of the Secured Obligations, the Grantor does hereby mortgage, pledge and hypothecate to the Collateral Agent (for the benefit of the Secured Creditors), and grant to the Collateral Agent (for the benefit of the Secured Creditors), all of the
following property (the “Trademark Collateral”), whether now owned or hereafter acquired or existing by it: 
  
 (a) all trademarks, trade names, corporate names, company names, business names, fictitious business names, trade styles, service marks,
certification marks, collective marks, logos, other source of business identifiers, prints and labels on which any of the foregoing have appeared or appear, designs and general intangibles of a like nature (all of the foregoing items in this clause
(a) being collectively called a “Trademark”), now existing anywhere in the world or hereafter adopted or acquired, whether currently in use or not, all registrations and recordings thereof and all applications in connection
therewith, whether pending or in preparation for filing, including registrations, recordings and applications in the United States Patent and Trademark Office or in any office or agency of the United States of America or any State thereof or any
foreign country, including those referred to in Item A of Attachment 1 attached hereto; 
  
 (b) all Trademark licenses, including each Trademark license referred to in Item B of Attachment 1 attached hereto; 
  
 (c) all reissues, extensions or renewals of any of the items
described in clauses (a) and (b); 
  
 (d) all of
the goodwill of the business connected with the use of, and symbolized by the items described in, clauses (a) and (b); and 
  
 (e) all proceeds of, and rights associated with, the foregoing, including any claim by the Grantor against third parties for past, present
or future infringement or dilution of any Trademark, Trademark registration or Trademark license, including any Trademark, Trademark registration or Trademark license referred to in Item A and Item B of Attachment 1 attached hereto, or for any
injury to the goodwill associated with the use of any such Trademark or for breach or enforcement of any Trademark license. 
  
 Section 3. Security Agreement. This Agreement has been executed and delivered by the Grantor for the purpose of registering the security interest
of the Collateral Agent in the Trademark Collateral with the United States Patent and Trademark Office and corresponding offices in other countries of the world. The security interest granted hereby has been granted as a supplement to, and not in
limitation of, the security interest granted to the Collateral Agent for its benefit and the benefit of each Secured Creditor under the Security Agreement. The Security Agreement (and all rights and remedies of the Collateral Agent and each Secured
Creditor thereunder) shall remain in full force and effect in accordance with its terms. 
  

 H-2 

 Section 4. Release of Security Interest. Upon payment in full in cash of all Secured Obligations
and the termination of the Aggregate Commitments, the Collateral Agent shall, at the Grantor’s expense, execute and deliver to the Grantor all instruments and other documents as may be necessary or proper to release the lien on and security
interest in the Trademark Collateral which has been granted hereunder. 
  
 Section 5. Acknowledgment. The Grantor does hereby further acknowledge and affirm that the rights and remedies of the Collateral Agent with respect to the security interest in the Trademark Collateral granted hereby are more fully
set forth in the Security Agreement, the terms and provisions of which (including the remedies provided for therein) are incorporated by reference herein as if fully set forth herein. 
  
 Section 6. Loan Document. This Agreement is a Loan Document executed pursuant to the Credit Agreement and shall
(unless otherwise expressly indicated herein) be construed, administered and applied in accordance with the terms and provisions of the Credit Agreement. 
  
 Section 7. Counterparts. This Agreement may be executed by the parties hereto in several counterparts, each of which shall be deemed to be an
original and all of which shall constitute together but one and the same agreement. The Grantor acknowledges that this Agreement is and shall be effective upon its execution and delivery by the Grantor to the Collateral Agent, and it shall not be
necessary for the Collateral Agent to execute this Agreement or any other acceptance hereof or otherwise to signify or express its acceptance hereof. 
  
 Section 8. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA APPLICABLE TO
AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT THE COLLATERAL AGENT SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW. 
  
 Section 9. JURISDICTION. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF
CALIFORNIA SITTING IN THE CITY AND COUNTY OF SAN FRANCISCO, CALIFORNIA OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF SUCH STATE, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE GRANTOR AND THE COLLATERAL AGENT CONSENTS, FOR
ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE GRANTOR AND THE COLLATERAL AGENT IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF
FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY OTHER DOCUMENT RELATED HERETO. EACH OF THE GRANTOR AND THE COLLATERAL AGENT WAIVES
PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE. 
  
 Section 10. WAIVER OF JURY TRIAL. EACH OF THE GRANTOR AND COLLATERAL AGENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM,

  

 H-3 

 DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL
TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO THIS AGREEMENT OR ANY OTHER DOCUMENT RELATING HERETO, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT
OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF
THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY. 
  
 Section 11. Patriot Act. The Collateral Agent (for itself and not on behalf of any other Person, including any Secured Creditor) hereby
notifies the Grantor that, pursuant to the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies the Grantor, which information includes the name and address of the Grantor and other information
that will allow the Collateral Agent to identify the Grantor in accordance with the Patriot Act. 
  
 Section 12. Time of the Essence. Time is of the essence of this Agreement. 
  

 H-4 

 IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their respective officers thereunto duly authorized as of the day and year first written above. 
  

			
	ARTHROCARE CORPORATION, A
DELAWARE
CORPORATION
		
	 By
	 	  

	 Name:
	 	 
	 Title:
	 	 

  

			
	WELLS FARGO BANK, NATIONAL ASSOCIATION,
  AS COLLATERAL
AGENT
		
	 By
	 	  

	 Name:
	 	 
	 Title:
	 	 

  

 H-5 

 ATTACHMENT I 
 TO TRADEMARK SECURITY AGREEMENT 
  

	ITEM	A. TRADEMARKS 

  

							
	REGISTERED TRADEMARKS
	COUNTRY

	 	TRADEMARK

	 	REGISTRATION
NO.

	 	REGISTRATION
DATE

	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	
	PENDING TRADEMARK APPLICATIONS
	COUNTRY

	 	TRADEMARK

	 	SERIAL NO.

	 	FILING DATE

	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
	USA	 	 	 	 	 	 
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 H-6 

 TRADEMARK APPLICATIONS IN PREPARATION

											
	COUNTY

	 	TRADEMARK

	 	DOCKET
NO.

	 	FILING
DATE

	 	EXPECTED
SERVICES

	 	PRODUCTS

	NONE.	 	 	 	 	 	 	 	 	 	 

  
 ITEM B
TRADEMARK LICENSES 
  

											
	COUNTY OR
TERRITORY

	 	TRADEMARK

	 	LICENSOR

	 	LICENSEE

	 	EFFECTIVE
DATE

	 	EXPIRATION
DATE

	NONE.	 	 	 	 	 	 	 	 	 	 

  

 H-7Form of Stock and Warrant Purchase Agreement

 Exhibit 10.77 
  
 STOCK AND WARRANT PURCHASE AGREEMENT 
  
 RITA Medical Systems, Inc. 
  
 Ladies & Gentlemen: 
  
 The undersigned,
                                        
                 (the “Investor”), hereby confirms its agreement with you as follows: 
  
 1. This Stock and Warrant Purchase Agreement is made as of November 24, 2004 between RITA Medical Systems, Inc., a Delaware corporation (the
“Company”), and the Investor. 
  
 2. The Company has authorized the sale
and issuance of up to 4,363,534 shares (the “Shares”) of common stock of the Company, $0.001 par value per share (the “Common Stock”), and warrants to purchase up to 3,272,649 Shares (75% warrant coverage) (the
“Warrant Shares”) of Common Stock at an exercise price per share of $4.00 (the “Warrants”) to certain investors in a private placement (the “Offering”). 
  
 3. The Company and the Investor agree that the Investor will purchase from the Company and the Company will issue and sell to the Investor
[            ] Shares and a Warrant to purchase [            ] Warrant Shares (75% warrant coverage),
for a purchase price of $2.75 per share, or an aggregate purchase price of $[            ], pursuant to the Terms and Conditions for Purchase of Shares attached hereto as
Annex I and incorporated herein by reference as if fully set forth herein (the “Terms and Conditions”). This Stock and Warrant Purchase Agreement, together with the Terms and Conditions which are incorporated herein by reference as if
fully set forth herein, may hereinafter be referred to as the “Agreement”. Unless otherwise requested by the Investor, the Warrant and certificates representing the Shares purchased by the Investor will be registered in the Investor’s
name and address as set forth below. The Warrant shall have the rights, preferences, privileges and restrictions as set forth in the form of Warrant attached hereto as Exhibit B. 
  
 4. The Investor represents that, except as set forth below, (a) it has had no position, office or other material relationship within the
past three months with the Company or persons known to it to be affiliates of the Company, (b) neither it, nor any group of which it is a member or to which it is related, beneficially owns (including the right to acquire or vote) any securities of
the Company, (c) it has no direct or indirect affiliation or association with any NASD member as of the date hereof and (d) immediately following the Closing (as defined in Section 3 of this Agreement), it will not be a person or a member of a group
of affiliated or associated persons that has acquired, or obtained the right to acquire, beneficial ownership of 15% or more of the outstanding securities of the Company’s Common Stock (assuming that 36,786,087 shares of the
Company’s Common Stock remain outstanding at such time).
Exceptions:                                      
                                        
                                        
                                        
                                        
                                        
                                        
                                     
 _______________________________________________________________________________________________________________________________________________. 
 (If no exceptions, write “none.” If left blank, response will be deemed to be “none.”) 
  
 Please confirm that the foregoing correctly sets forth the agreement between us by signing in the space provided below for
that purpose. By executing this Agreement, the Investor acknowledges that the Company may use the information in paragraph 4 above and the name and address information below in preparation of the Registration Statement (as defined in Annex 1).

  
 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 

					
	 AGREED AND ACCEPTED:
	 	 	 	 
	RITA Medical Systems, Inc.	 	Investor:	 	  

	 	 	By:	 	  

	  

	 	Print Name:	 	 
	By:	 	Title:	 	 
	Title:	 	 	 	 
			
	 	 	Address:	 	  

	 	 	  

			
	 	 	Tax ID No.:	 	  

	 	 	Contact name:	 	  

	 	 	Telephone:	 	  

	 	 	Name in which shares should be registered (if different):

  

 - 2 - 

 ANNEX I 
  
 TERMS AND CONDITIONS FOR PURCHASE OF SHARES AND WARRANTS 
  
 1. Authorization and Sale of the Shares. Subject to these Terms and Conditions, the Company has authorized the sale of up to 4,363,534
Shares and Warrants to purchase up to 3,272,649 Warrant Shares (75% warrant coverage). The Company reserves the right to increase or decrease this number. 
  
 2. Agreement to Sell and Purchase the Shares; Subscription Date. 
  
 2.1 At the Closing (as defined in Section 3), the Company will sell to the
Investor, and the Investor will purchase from the Company, upon the terms and conditions hereinafter set forth, the number of Shares and a Warrant to purchase the number of Warrant Shares each as set forth in Section 3 of the Stock and Warrant
Purchase Agreement to which these Terms and Conditions are attached at the purchase price set forth thereon. 
  
 2.2 The Company may enter into the same form of Stock and Warrant Purchase Agreement, including these Terms and Conditions, with certain other investors
(the “Other Investors”) and expects to complete sales of Shares and Warrants to them. (The Investor and the Other Investors are hereinafter sometimes collectively referred to as the “Investors,” and the Stock and Warrant Purchase
Agreement to which these Terms and Conditions are attached and the Stock and Warrant Purchase Agreements (including attached Terms and Conditions) executed by the Other Investors are hereinafter sometimes collectively referred to as the
“Agreements.”) The Company may accept executed Agreements from Investors for the purchase of Shares and Warrants commencing upon the date on which the Company provides the Investors with the proposed purchase price per Share plus Warrant
exercise price and concluding upon the date (the “Subscription Date”) on which the Company has (i) executed Agreements with Investors for the purchase of at least 4,363,534 Shares and Warrants to purchase at least 3,272,649
Warrant Shares (75% warrant coverage), and (ii) notified Wells Fargo Securities, LLC, in its capacity as placement agent for this transaction, in writing that it is no longer accepting additional Agreements from Investors for the purchase of
Shares and Warrants. The Company may not enter into any Agreements after the Subscription Date. 
  
 2.3 The obligations of each Investor under any Agreement are several and not joint with the obligations of any Other Investor, and no Investor shall be
responsible in any way for the performance of the obligations of any other Investor under any Agreement. Nothing contained herein, and no action taken by any Investor hereto, shall be deemed to constitute the Investors as a partnership, an
association, a joint venture or any other kind of entity, or create a presumption that the Investors are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated hereby, provided that such
obligations or the transactions contemplated hereby may be modified, amended or waived in accordance with Section 9 below. Each Investor shall be entitled to independently protect and enforce its rights, including without limitation the rights
arising out of this Agreement (provided, that such rights may be modified, amended or waived in accordance with Section 9 below) and the Warrant, and it shall not be necessary for any Other Investor to be joined as an additional party in any
proceeding for such purpose. 
  
 3. Delivery of the Shares and
Warrants at Closing. The completion of the purchase and sale of the Shares and Warrants (the “Closing”) shall occur (the “Closing Date”) on November 24, 2004, at the offices of the Company’s counsel. At the Closing, the
Company shall deliver to the Investor a Warrant representing the number of Warrant Shares and one or more stock certificates representing the number of Shares, in each case as is set forth in Section 3 of the Stock and Warrant Purchase Agreement,
each such certificate to be registered in the name of the Investor or, if so indicated on the signature page of the Stock and Warrant Purchase Agreement, in the name of a nominee designated by the Investor. 
  
 The Company’s obligation to issue the Shares and the Warrant to the
Investor shall be subject to the following conditions, any one or more of which may be waived by the Company: (a) receipt by the Company of a certified or official bank check or wire transfer of funds in the full amount of the purchase price for the
Shares and the Warrant being purchased hereunder as set forth in Section 3 of the Stock and Warrant Purchase Agreement; (b) completion of the purchases and sales under the Agreements with the Other Investors; (c) the accuracy of the representations
and warranties made by the Investors and the fulfillment of those undertakings of the Investors to be fulfilled prior to the Closing; and (d) delivery of a completed Selling Stockholder Notice and Questionnaire in substantially the form attached
hereto as Exhibit C. 
  
 The Investor’s obligation to
purchase the Shares and the Warrant shall be subject to the following conditions, any one or more of which may be waived by the Investor: (a) Investors shall have executed Agreements for the purchase of at least 4,363,534 Shares and Warrants
for the purchase of at least 3,272,649 Warrant Shares (75% warrant coverage), (b) the representations and warranties of the Company set forth herein shall be true and correct as of the Closing Date in all material respects (except for
representations and warranties that speak as of a specific date, which representations and warranties shall be 
  

 - 3 - 

 true and correct as of such date) and (c) the Investor shall have received such documents as such Investor shall
reasonably have requested, including, a standard opinion of the Company’s counsel as to the matters set forth in Section 4.2 and as to exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities
Act”), of the sale of the Shares and Warrants. 
  
 4.
Representations, Warranties and Covenants of the Company. Except as separately disclosed by the Company to the Investor in the disclosure schedules to the representations, warranties and covenants of the Company set forth in this Section 4
(the “Disclosure Schedules”), the Company hereby represents and warrants to, and covenants with, the Investor, as follows: 
  
 4.1 Organization. The Company is duly organized and validly existing in good standing under the laws of the jurisdiction of its organization. Each
of the Company and its Subsidiaries (as defined in Rule 405 under the Securities Act) has full power and authority to own, operate and occupy its properties and to conduct its business as presently conducted and as described in the documents filed
by the Company under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), since the end of its most recently completed fiscal year through the date hereof (the “Exchange Act Documents”) and is registered or
qualified to do business and in good standing in each jurisdiction in which the nature of the business conducted by it or the location of the properties owned or leased by it requires such qualification and where the failure to be so qualified would
have a material adverse effect upon the condition (financial or otherwise), earnings, business or business prospects, properties or operations of the Company and its Subsidiaries, considered as one enterprise (a “Material Adverse Effect”),
and no proceeding has been instituted in any such jurisdiction, revoking, limiting or curtailing, or seeking to revoke, limit or curtail, such power and authority or qualification. 
  
 4.2 Due Authorization and Valid Issuance. The Company has all requisite power and authority to execute, deliver and
perform its obligations under the Agreements and the Warrants, and the Agreements and the Warrants have been duly authorized and validly executed and delivered by the Company and constitute legal, valid and binding agreements of the Company
enforceable against the Company in accordance with their terms, except as rights to indemnity and contribution may be limited by state or federal securities laws or the public policy underlying such laws, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ and contracting parties’ rights generally and except as enforceability may be subject to general principles of equity (regardless of whether
such enforceability is considered in a proceeding in equity or at law). The Shares and the Warrant being purchased by the Investor hereunder and the Warrant Shares issuable pursuant to the Warrant will, upon issuance and payment therefor pursuant to
the terms hereof and thereof, be duly authorized, validly issued, fully-paid and nonassessable. 
  
 4.3 Non-Contravention. The execution and delivery of the Agreements and the Warrants, the issuance and sale of the Shares and the Warrants under
the Agreements and the Warrant Shares under the Warrant, the fulfillment of the terms of the Agreements and the Warrants and the consummation of the transactions contemplated thereby will not (A) conflict with or constitute a violation of, or
default (with the passage of time or otherwise) under, (i) any contract, agreement or other instrument filed or incorporated by reference as an exhibit to any of the Exchange Act Documents (any such contract, agreement or instrument, an
“Exchange Act Exhibit”), (ii) the charter, by-laws or other organizational documents of the Company or any Subsidiary, or (iii) any law, administrative regulation, ordinance or order of any court or governmental agency, arbitration panel
or authority applicable to the Company or any Subsidiary or their respective properties, except in the case of clauses (i) and (iii) for any such conflicts, violations or defaults which are not reasonably likely to have a Material Adverse Effect or
(B) result in the creation or imposition of any lien, encumbrance, claim, security interest or restriction whatsoever upon any of the material properties or assets of the Company or any Subsidiary or an acceleration of indebtedness pursuant to any
obligation, agreement or condition contained in any Exchange Act Exhibit. No consent, approval, authorization or other order of, or registration, qualification or filing with, any regulatory body, administrative agency, or other governmental body in
the United States or any other person is required for the execution and delivery of the Agreements and the Warrants, and the valid issuance and sale of the Shares and Warrants to be sold pursuant to the Agreements, and the valid issuance of the
Warrant Shares under the Warrant, other than such as have been made or obtained, and except for any post-closing securities filings or notifications required to be made under federal or state securities laws. 
  
 4.4 Capitalization. The capitalization of the Company as of September
30, 2004 is as set forth in the most recent applicable Exchange Act Documents, increased as set forth in the next sentence. The Company has not issued any capital stock since that date other than pursuant to (i) employee benefit plans disclosed in
the Exchange Act Documents, or (ii) outstanding warrants, options or other securities disclosed in the Exchange Act Documents. The Shares and the Warrants to be sold pursuant to the Agreements, and the Warrant Shares to be issued pursuant to the
Warrants, have been duly authorized, and when issued and paid for in accordance with the terms of the Agreements and the Warrants, as the case may be, will be duly and validly issued, fully paid and nonassessable. The outstanding shares of capital
stock of the Company have been duly and validly issued and are fully paid and nonassessable, have been issued in compliance with all federal and state securities laws, and were not issued in violation of any preemptive rights or similar rights to
subscribe for or purchase securities. Except as set forth in or contemplated by the Exchange Act Documents, there are no outstanding rights (including, without limitation, preemptive rights), warrants or options to 
  

 - 4 - 

 acquire, or instruments convertible into or exchangeable for, any unissued shares of capital stock or other equity
interest in the Company or any Subsidiary, or any contract, commitment, agreement, understanding or arrangement of any kind to which the Company is a party or of which the Company has knowledge and relating to the issuance or sale of any capital
stock of the Company or any Subsidiary, any such convertible or exchangeable securities or any such rights, warrants or options. Without limiting the foregoing, no preemptive right, co-sale right, right of first refusal, registration right, or other
similar right exists with respect to the Shares, the Warrants or the Warrant Shares or the issuance and sale thereof, except for certain “piggy back” registration rights granted by the Company on or before June 20, 2000, which registration
rights (including all rights to notice related thereto) have been waived by all of the holders thereof in connection with the filing of, and the proposal to file, the Registration Statement (defined below). No further approval or authorization of
any stockholder, the Board of Directors of the Company or others is required for the issuance and sale of the Shares, the Warrants and the Warrant Shares. The Company owns the entire equity interest in each of its Subsidiaries, free and clear of any
pledge, lien, security interest, encumbrance, claim or equitable interest, other than as described in the Exchange Act Documents. Except as disclosed in the Exchange Act Documents, there are no stockholders agreements, voting agreements or other
similar agreements with respect to the Common Stock to which the Company is a party or, to the knowledge of the Company, between or among any of the Company’s stockholders. 
  
 4.5 Legal Proceedings. There is no material legal or governmental proceeding pending or, to the knowledge of the
Company, threatened to which the Company or any Subsidiary is or may be a party or of which the business or property of the Company or any Subsidiary is subject that is not disclosed in the Exchange Act Documents. There are no disagreements of any
kind presently existing, or reasonably anticipated by the Company to arise between the accountants and lawyers formerly or presently employed by the Company. 
  
 4.6 No Violations. Neither the Company nor any Subsidiary is (i) in violation of its charter, bylaws, or other organizational document, (ii) in
violation of any law, administrative regulation, ordinance or order of any court or governmental agency, arbitration panel or authority applicable to the Company or any Subsidiary, which violation, individually or in the aggregate, would be
reasonably likely to have a Material Adverse Effect, or (iii) in default (and there exists no condition which, with the passage of time or otherwise, would constitute a default) in any material respect in the performance of any Exchange Act Exhibit,
which would be reasonably likely to have a Material Adverse Effect. 
  
 4.7 Governmental Permits, Etc. With the exception of the matters which are dealt with separately in Sections 4.1, 4.12, 4.13, and 4.14, each of the Company and its Subsidiaries has all necessary franchises, licenses, certificates and
other authorizations from any foreign, federal, state or local government or governmental agency, department, or body that are currently necessary for the operation of the business of the Company and its Subsidiaries as currently conducted and as
described in the Exchange Act Documents except where the failure to currently possess could not reasonably be expected to have a Material Adverse Effect. 
  
 4.8 Intellectual Property. Except as specifically disclosed in the Exchange Act Documents (i) each of the Company and its Subsidiaries owns or
possesses sufficient rights to use all material patents, patent rights, trademarks, copyrights, licenses, inventions, trade secrets, trade names and know-how (collectively, “Intellectual Property”) described or referred to in the Exchange
Act Documents as owned or possessed by it or that are necessary for the conduct of its business as now conducted or as proposed to be conducted as described in the Exchange Act Documents except where the failure to currently own or possess would not
have a Material Adverse Effect, (ii) to the knowledge of the Company, neither the Company nor any of its Subsidiaries is infringing any rights of a third party with respect to any Intellectual Property that, individual or in the aggregate, would
have a Material Adverse Effect, (iii) neither the Company nor any of its Subsidiaries has received any notice of, or has any knowledge of, any asserted infringement by the Company or any of its Subsidiaries of, any rights of a third party with
respect to any Intellectual Property that, individually or in the aggregate, would have a Material Adverse Effect if determined adversely to the Company and (iv) neither the Company nor any of its Subsidiaries has received any notice of, or has any
knowledge of, infringement by a third party with respect to any Intellectual Property rights of the Company or of any Subsidiary that, individually or in the aggregate, would have a Material Adverse Effect. 
  
 4.9 Financial Statements; Solvency; Obligations to Related Parties.
(a) The financial statements of the Company and the related notes contained in the Exchange Act Documents present fairly, in accordance with generally accepted accounting principles, the financial position of the Company and its Subsidiaries as of
the dates indicated, and the results of its operations and cash flows for the periods therein specified consistent with the books and records of the Company and its Subsidiaries except that the unaudited interim financial statements were or are
subject to normal and recurring year-end adjustments which are not expected to be material in amount. Such financial statements (including the related notes) have been prepared in accordance with generally accepted accounting principles applied on a
consistent basis throughout the periods therein specified, except as may be disclosed in the notes to such financial statements, or in the case of unaudited statements, as may be permitted by the SEC on Form 10-Q under the Exchange Act and except as
disclosed in the Exchange Act Documents. The other financial information contained in the Exchange Act Documents has been prepared on a basis consistent with the financial statements of the Company. 
  

 - 5 - 

 (b) Except as disclosed in the Company’s Quarterly Report on Form 10-Q for the quarter ended
September 30, 2004 (the “Third Quarter 10-Q”), (i) the fair saleable value of the Company’s assets exceeds the amount that will be required to be paid on or in respect of the Company’s existing liabilities and other obligations
as such matures or is otherwise payable; (ii) the Company’s assets do not constitute unreasonably small capital to carry on its business for the current fiscal year as now conducted and as proposed to be conducted taking into account the
current and projected capital requirements of the business conducted by the Company and projected capital availability; and (iii) the current cash flow of the Company, together with the proceeds the Company would receive upon liquidation of its
assets, after taking into account all anticipated uses of such amounts, would be sufficient to pay all such liabilities and obligations when such is required to be paid. The Company does not intend to incur liabilities and other obligations beyond
its ability to pay such as they mature or are required to be paid. The Company has no knowledge of any facts or circumstances (other than as disclosed in the Third Quarter 10-Q) which lead it to believe that it will be required to file for
reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction, and has no present intention to so file. 
  
 (c) Except as set forth in any Exchange Act Documents, there are no obligations of Company to officers, directors, stockholders or employees of Company
other than (i) for payment of salary for services rendered and for bonus payments; (ii) reimbursements for reasonable expenses incurred on behalf of Company; (iii) for other standard employee benefits made generally available to all employees
(including stock option agreements outstanding under any stock option plan approved by the Board of Directors of Company); and (iv) obligations listed in Company’s financial statements. Except as described above or in any Exchange Act Filings,
none of the officers, directors or, to the best of Company’s knowledge, key employees or stockholders of Company or any members of their immediate families, are indebted to Company, individually or in the aggregate, in excess of $60,000 or have
any direct or indirect ownership interest in any firm or corporation with which Company is affiliated or with which Company has a business relationship, or any firm or corporation which competes with Company, other than passive investments in
publicly traded companies (representing less than one percent (1%) of such company) which may compete with Company. Except as described above, no officer, director or stockholder, or any member of their immediate families, is, directly or
indirectly, interested in any material contract with Company and no agreements, understandings or proposed transactions are contemplated between Company and any such person. Except as set forth in any Exchange Act Documents, Company is not a
guarantor or indemnitor of any indebtedness of any other person, firm or corporation. 
  
 4.10 No Material Adverse Change. Except as disclosed in the Exchange Act Documents, since September 30, 2004, there has not been (i) any material adverse change in the financial condition or earnings of the
Company and its Subsidiaries considered as one enterprise, (ii) any material adverse event affecting the Company or its Subsidiaries, (iii) any obligation, direct or contingent, that is material to the Company and its Subsidiaries considered as one
enterprise, incurred by the Company, except obligations incurred in the ordinary course of business, (iv) any dividend or distribution of any kind declared, paid or made on the capital stock of the Company or any of its Subsidiaries, or (v) any loss
or damage (whether or not insured) to the physical property of the Company or any of its Subsidiaries which has been sustained which has a Material Adverse Effect; provided, however, that changes in the ordinary course of business, including
but not limited to the use of cash and increases in liabilities in the ordinary course of business, shall not be deemed to be a material adverse change or to have a Material Adverse Effect. 
  
 4.11 Disclosure. Except as otherwise set forth in the Disclosure
Schedules, the representations and warranties of the Company contained in this Section 4 as of the date hereof and as of the Closing Date, do not contain any untrue statement of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. Except with respect to the material terms and conditions of the transaction contemplated by the Agreements and the
Warrants, which shall be publicly disclosed by the Company pursuant to Section 16 hereof, and except for the information set forth in the Disclosure Schedules which information (i) shall be publicly disclosed by the Company on or prior to 30
calendar days after the Closing Date (the “Expiration Date”) or (ii) shall no longer constitute material non-public information, the Company confirms that neither it nor any person acting on its behalf has provided the Investors with any
information that the Company believes constitutes material, non-public information. The Company understands and confirms that the Investors will rely on the foregoing representations in effecting transactions in the securities of the Company.

  
 4.12 NASDAQ Compliance. The Company’s Common Stock
is registered pursuant to Section 12(g) of the Exchange Act and is listed on The Nasdaq Stock Market, Inc. National Market (the “Nasdaq National Market”), and the Company has taken no action designed to, or likely to have the effect of,
terminating the registration of the Common Stock under the Exchange Act or de-listing the Common Stock from the Nasdaq National Market, nor has the Company received any notification that the SEC or the National Association of Securities Dealers,
Inc. (“NASD”) is currently contemplating terminating such registration or listing. 
  

 - 6 - 

 4.13 Reporting Status. The Company has filed in a timely manner all documents that the Company was
required to file under the Exchange Act during the 12 months preceding the date of this Agreement. Pursuant to General Instruction I.B.3 of Form S-3, the Company is eligible to use Form S-3 to register the Shares and Warrant Shares to be offered for
the account of the Investors. The following documents complied in all material respects with the SEC’s requirements as of their respective filing dates, and the information contained therein as of the date thereof did not contain an untrue
statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein in light of the circumstances under which they were made not misleading: 
  
 (a) Annual Report on Form 10-K for the year ended December 31, 2003 and
Quarterly Report on Form 10-Q for the quarter ended September 30, 2004, Forms 8-K filed on January 13, 2004, January 21, 2004, February 11, 2004, February 13, 2004, February 19, 2004, March 5, 2004, March 11, 2004, March 24, 2004, April 1, 2004,
April 29, 2004, May 10, 2004, May 14, 2004, June 3, 2004, June 9, 2004, June 28, 2004, July 9, 2004, July 30, 2004, August 3, 2004, August 9, 2004, August 30, 2004, September 14, 2004, September 23, 2004, September 28, 2004, September 29, 2004,
September 30, 2004, October 15, 2004, October 29, 2004, November 3, 2004, November 4, 2004, November 10, 2004, and November 12, 2004 and Proxy Statement on Schedule 14A filed on April 29, 2004; and 
  
 (b) all other documents, if any, filed by the Company with the SEC during
the one-year period preceding the date of this Agreement pursuant to the reporting requirements of the Exchange Act. 
  
 4.14 Listing. Except for the 15 day prior notice requirement of the transactions contemplated by this Agreement which has been waived by the Nasdaq
National Market, the Company shall comply with all requirements of the NASD with respect to the issuance of the Shares, the Warrant and the Warrant Shares, and the listing of the Shares and Warrant Shares on the Nasdaq National Market. 

 
 4.15 No Manipulation of Stock. The Company has not taken and will
not, in violation of applicable law, take, any action designed to or that might reasonably be expected to cause or result in stabilization or manipulation of the price of the Common Stock to facilitate the sale or resale of the Shares or the Warrant
Shares. 
  
 4.16 Company not an “Investment
Company”. The Company has been advised of the rules and requirements under the Investment Company Act of 1940, as amended (the “Investment Company Act”). The Company is not, and immediately after receipt of payment for the Shares
and the Warrants and the Warrant Shares will not be, an “investment company” or an entity “controlled” by an “investment company” within the meaning of the Investment Company Act and shall conduct its business in a
manner so that it will not become subject to the Investment Company Act. 
  
 4.17 Foreign Corrupt Practices. Neither the Company, nor to the knowledge of the Company, any agent or other person acting on behalf of the Company, has (i) directly or indirectly, used any corrupt funds for
unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic
political parties or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Company (or made by any person acting on its behalf of which the Company is aware) which is in violation of law, or (iv) violated in any
material respect any provision of the Foreign Corrupt Practices Act of 1977, as amended. 
  
 4.18 Accountants. To the Company’s knowledge, Pricewaterhouse Coopers LLC, who the Company expects will consent to the incorporation by
reference of its report dated March 8, 2004 with respect to the consolidated financial statements of the Company included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2003 into the Registration Statement (as
defined below) and the prospectus which forms a part thereof, are and, during the periods covered by their reports, were independent accountants as required by the Securities Act and the rules and regulations promulgated thereunder.

  
 4.19 Contracts. The contracts described in the Exchange
Act Documents that are material to the Company are in full force and effect on the date hereof, and neither the Company nor, to the Company’s knowledge, any other party to such contracts is in breach of or default under any of such contracts
which would have a Material Adverse Effect. The Company has filed with the SEC all contracts and agreements required to be filed by the Exchange Act. 
  
 4.20 Taxes. The Company has filed all necessary federal, state and foreign income and franchise tax returns and has paid or accrued all taxes shown
as due thereon, except where failure to so file or to so pay would not have a Material Adverse Effect and the Company has no knowledge of a tax deficiency which has been or might be asserted or threatened against it which would have a Material
Adverse Effect. 
  

 - 7 - 

 4.21 Transfer Taxes. On the Closing Date, all stock transfer or other taxes (other than income
taxes) which are required to be paid in connection with the sale and transfer of the Shares and the Warrants to be sold to the Investor hereunder will be, or will have been, fully paid or provided for by the Company and all laws imposing such taxes
will be or will have been fully complied with. Upon the issuance of the Warrant Shares pursuant to the Warrant all stock transfer or other taxes (other than income taxes) which are required to be paid in connection therewith will be, or will have
been, fully paid or provided for by the Company and all laws imposing such taxes will be or will have been fully complied with. 
  
 4.22 Private Offering. Assuming the correctness of the representations and warranties of the Investors set forth in Section 5 hereof, the offer and
sale of Shares and the Warrants hereunder is and, upon exercise of the Warrants, the issuance of the Warrant Shares will be exempt from registration under the Securities Act. The Company has not distributed and will not distribute prior to the
Closing Date any offering material in connection with this Offering and sale of the Shares and the Warrants other than the documents of which this Agreement is a part or the Exchange Act Documents. The Company has not in the past nor will it
hereafter take any action independent of the placement agent to sell, offer for sale or solicit offers to buy any securities of the Company which would bring the offer, issuance or sale of the Shares and the Warrants as contemplated by this
Agreement, or the issuance of the Warrant Shares pursuant to the Warrant, within the provisions of Section 5 of the Securities Act, unless such offer, issuance or sale was or shall be within the exemptions of Section 4 of the Securities Act.
Neither the Company nor any person acting on behalf of the Company (other than Wells Fargo Securities, LLC) has offered or sold any of the Shares by any form of general solicitation or general advertising. The Company has offered the Shares for
sale only to the Investors and certain other “accredited investors” within the meaning of Rule 501 under the Securities Act. 
  
 4.23 Disclosure Controls and Procedures. The Company is in material compliance with all provisions of the Sarbanes-Oxley Act of 2002 which are
applicable to it as of the Closing Date. The Company maintains a system of internal control over financial reporting (as such term is defined in the Exchange Act) sufficient to provide reasonable assurance that (i) transactions are executed in
accordance with management’s general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability, (iii) access to assets is
permitted only in accordance with management’s general or specific authorization, and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any
differences. The Company’s certifying officers are responsible for establishing and maintaining disclosure controls and procedures (as defined in the Exchange Act) for the Company and they have (a) designed such disclosure controls and
procedures, or caused such disclosure controls and procedures to be designed under their supervision, to ensure that material information relating to the Company, including its Subsidiaries, is made known to the certifying officers by others within
those entities, particularly during the periods in which the Exchange Act Documents have been prepared; (b) evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in the applicable Exchange Act Documents
their conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the periods covered by such Exchange Act Documents based on such evaluation; and (c) since the last evaluation date referred to in (b) above, there
have been no material changes in the Company’s internal control over financial reporting (as such term is defined in the Exchange Act) or, to the Company’s knowledge, in other factors that could significantly affect the Company’s
internal control over financial reporting. 
  
 4.24
Transactions With Affiliates. Except as disclosed in the Exchange Act Documents, none of the current officers or directors of the Company is presently a party to any transaction with the Company or any Subsidiary (other than for services as
employees, officers and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments to or from
any officer or director or, to the knowledge of the Company, any entity in which any officer or director has a substantial interest or is an officer, director, trustee or partner. 
  
 4.25 No Registration Rights. Except for the registration rights provided to certain of the Company’s
stockholders pursuant to the Sixth Amended and Restated Shareholder Rights Agreement effective as of May 26, 2000 by and among the Company the parties listed therein (the “Rights Agreement’), no person has the right, which right has not
been waived, to require the Company or any Subsidiary to register any securities for sale under the Securities Act by reason of the filing of the Registration Statement with the SEC or the issuance and sale of the Shares, Warrants or Warrant Shares.
Notwithstanding the foregoing, within 10 days after the Closing Date the Company shall have obtained waivers of the right to require the Company to register their securities for sale under the Securities Act from the parties to the Rights
Agreement. 
  
 5. Representations, Warranties and
Covenants of the Investor. 
  
 5.1 The Investor
severally, but not jointly with any other Investor, represents and warrants to, and covenants with, the Company that: (i) the Investor is an “accredited investor” as defined in Regulation D under the Securities Act and the Investor is also
knowledgeable, sophisticated and experienced in making, and is qualified to make decisions with respect to investments in shares presenting an investment decision like that involved in the purchase of the Shares and the Warrant, including
investments in securities issued by the Company and investments in comparable companies, and has requested, received, reviewed 
  

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 and considered all information it deemed relevant in making an informed decision to purchase the Shares and the Warrant;
(ii) the Investor is acquiring the Warrant to purchase the number of Warrant Shares and the number of Shares, each as set forth in Section 3 of the Stock and Warrant Purchase Agreement, in the ordinary course of its business and for its own account
for investment only and with no present intention of distributing any of such Shares, Warrant or Warrant Shares or entering into any arrangement or understanding with any other persons regarding the distribution of such Shares, Warrant or Warrant
Shares; (iii) the Investor will not, directly or indirectly, offer, sell, pledge, transfer or otherwise dispose of (or solicit any offers to buy, purchase or otherwise acquire or take a pledge of) any of the Shares, Warrant or Warrant Shares except
in compliance with the Securities Act, applicable state securities laws and the respective rules and regulations promulgated thereunder; (iv) the Investor has answered all questions on the Investor Questionnaire for use in preparation of the
Registration Statement and the answers thereto are true, correct and complete as of the date hereof and, unless otherwise disclosed to the Company in writing prior to the Closing Date, will be true, correct and complete as of the Closing Date; (v)
the Investor will notify the Company immediately of any change in any of such information which is required to be disclosed in the Registration Statement until such time as the Investor has sold all of its Shares and Warrant Shares or until the
Company is no longer required to keep the Registration Statement effective; and (vi) the Investor has, in connection with its decision to purchase the number of Shares and the Warrant to purchase the number of Warrant Shares, each as set forth in
Section 3 of the Stock and Warrant Purchase Agreement, relied only upon the Exchange Act Documents and the representations and warranties of the Company contained herein. The Investor understands that its acquisition of the Shares and the Warrant
has not been registered under the Securities Act or registered or qualified under any state securities law in reliance on specific exemptions therefrom, which exemptions may depend upon, among other things, the bona fide nature of the
Investor’s investment intent as expressed herein. Subject to compliance with the Securities Act, applicable securities laws and the respective rules and regulations promulgated thereunder, nothing contained herein shall be deemed a
representation or warranty by such Investor to hold the Shares, Warrant or Warrant Shares for any period of time. The Investor has completed or caused to be completed and delivered to the Company the Investor Questionnaire, which questionnaire is
true, correct and complete in all material respects. 
  
 5.2 The
Investor severally, but not jointly with any other Investor, acknowledges, represents and agrees that no action has been or will be taken in any jurisdiction outside the United States by the Company that would permit an offering of the Shares,
Warrant or Warrant Shares or possession or distribution of offering materials in connection with the issue of the Shares, Warrant or Warrant Shares in any jurisdiction outside the United States where legal action by the Company for that purpose is
required. Each Investor outside the United States will comply with all applicable laws and regulations in each foreign jurisdiction in which it purchases, offers, sells or delivers Shares, the Warrant or Warrant Shares or has in its possession or
distributes any offering material, in all cases at its own expense. 
  
 5.3 The Investor hereby covenants with the Company not to make any sale of the Shares, Warrant or Warrant Shares without complying with the provisions of this Agreement and without causing the prospectus delivery requirement under the
Securities Act to be satisfied (whether by delivery of the Prospectus or pursuant to and in compliance with an exemption from such requirement), and the Investor acknowledges that the certificates evidencing the Shares and Warrant Shares will be
imprinted with a legend that prohibits their transfer except in accordance therewith. The Investor acknowledges that there may occasionally be times when the Company determines that it must suspend the use of the Prospectus forming a part of the
Registration Statement, as set forth in Section 7.2(c). 
  
 5.4
The Investor further represents and warrants to, and covenants with, the Company that (i) the Investor has full right, power, authority and capacity to enter into this Agreement and to consummate the transactions contemplated hereby and has taken
all necessary action to authorize the execution, delivery and performance of this Agreement, and (ii) this Agreement constitutes a valid and binding obligation of the Investor enforceable against the Investor in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ and contracting parties’ rights generally and except as enforceability may be subject to general principles
of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law) and except as the indemnification agreements of the Investors herein may be legally unenforceable. 
  
 5.5 Between the time the Investor learned about the Offering and the
Expiration Date, the Investor has not engaged in any transaction (including short sales or similar transactions) with respect to the Common Stock, nor has the Investor, directly or indirectly, caused any person to engage in any transaction
(including short sales or similar transactions) with respect to the Common Stock. The Investor will not use any of the Shares or the Warrant acquired pursuant to this Agreement, or the Warrant Shares acquired pursuant to the Warrant, to cover any
short position in the Common Stock of the Company if doing so would be in violation of applicable securities laws. 
  
 5.6 The Investor understands that nothing in the Exchange Act Documents, this Agreement or any other materials presented to the Investor in connection
with the purchase and sale of the Shares and the Warrant constitutes legal, tax or investment advice. The Investor has consulted such legal, tax and investment advisors as it, in its sole discretion, has deemed necessary or appropriate in connection
with its purchase of Shares and the Warrant. 
  

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 5.7 The Company acknowledges and agrees that Investor does not make or has not made any representations
or warranties with respect to the transactions contemplated hereby other than those specifically set forth in Sections 5 and 16(a) of this Agreement, or in the Investor Questionnaire. 
  
 6. Survival of Representations, Warranties and Agreements. Notwithstanding any investigation made by any party to
this Agreement, all covenants, agreements, representations and warranties made by the Company and the Investor herein shall survive the execution of this Agreement, the delivery to the Investor of the Shares and the Warrant being purchased and the
payment therefor. 
  
 7. Registration of the Shares; Compliance
with the Securities Act; Participation Rights. 
  
 7.1
Registration Procedures and Other Matters. The Company shall: 
  
 (a) subject to receipt of necessary information from the Investors, as set forth in the Selling Stockholder Notice and Questionnaire attached as Exhibit C hereto, after prompt request from the Company to the Investors to provide such
information, prepare and file with the SEC, within 10 days after the Closing Date (or, if such tenth day is a Saturday, Sunday or holiday, then by the next succeeding business day), a registration statement on Form S-3 (the “Registration
Statement”) to enable the resale of the Shares and the Warrant Shares (or such additional shares of Common Stock as may be issuable to the Investor pursuant to Rule 416 of the Securities Act) by the Investors from time to time through the
automated quotation system of the Nasdaq National Market or in privately-negotiated transactions; 
  
 (b) subject to receipt of necessary information from the Investors, including the Selling Stockholder Notice and Questionnaire attached as Exhibit
C hereto, after prompt request from the Company to the Investors to provide such information, (i) use its best efforts to cause the Registration Statement to become effective within 45 days after the Registration Statement is filed by the
Company, such efforts to include, without limiting the generality of the foregoing, preparing and filing with the SEC in such 45-day period any financial statements that are required to be filed prior to the effectiveness of such Registration
Statement, and (ii) (A) request that the Registration Statement becomes effective as of 5:00 p.m.(EST) on such date as the Company requests effectiveness of the Registration Statement and (B) electronically deliver to the Investor a final copy of
the Prospectus (as defined below) prior to the commencement of trading at the Nasdaq National Market on the business day immediately after the date on which the Registration Statement becomes effective; 
  
 (c) use its best efforts to prepare and file with the SEC such amendments
and supplements to the Registration Statement and the prospectus used in connection therewith (the “Prospectus”) as may be necessary to keep the Registration Statement current, effective and free from any material misstatement or omission
to state a material fact for a period not exceeding, with respect to each Investor’s Shares purchased hereunder and Warrant Shares purchased under the Warrant, the earlier of (i) two years after the Closing Date, (ii) the date on which
the Investor may sell all Shares and Warrant Shares then held by the Investor without restriction by the volume limitations of Rule 144(e) of the Securities Act, or (iii) such time as all Shares purchased by such Investor in this Offering and
Warrant Shares issuable pursuant to the Warrant have been sold pursuant to a registration statement; 
  
 (d) furnish to the Investor with respect to the Shares and Warrant Shares registered under the Registration Statement such number of copies of the
Registration Statement, Prospectuses and Preliminary Prospectuses in conformity with the requirements of the Securities Act and such other documents as the Investor may reasonably request, in order to facilitate the public sale or other disposition
of all or any of the Shares or Warrant Shares by the Investor; 
  
 (e) file documents required of the Company for normal blue sky clearance in states specified in writing by the Investor and use its best efforts to maintain such blue sky qualifications during the period the Company is required to maintain
the effectiveness of the Registration Statement pursuant to Section 7.1(c); provided, however, that the Company shall not be required to qualify to do business or consent to service of process in any jurisdiction in which it is not now so qualified
or has not so consented; 
  
 (f) bear all expenses in connection
with the procedures in paragraph (a) through (e), (h) and the last paragraph of this Section 7.1 (other than underwriting discounts or commissions, brokers’ fees and similar selling expenses, and any other fees or expenses incurred by the
Investor, including attorneys’ fees) and the registration of the Shares and Warrant Shares pursuant to the Registration Statement; 
  
 (g) advise the Investor, promptly after it shall receive notice or obtain knowledge of the issuance of any stop order by the SEC delaying or suspending
the effectiveness of the Registration Statement or of the initiation or threat of any proceeding for that purpose; and it will promptly use its best efforts to prevent the issuance of any stop order or to obtain its withdrawal at the earliest
possible moment if such stop order should be issued; and 
  

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 (h) provide a “Plan of Distribution” section of the Registration Statement that is acceptable
to all Investors and which, at a minimum, states that the selling stockholders may transfer the shares of common stock in various circumstances, in which case the transferees, pledgees or other successors in interest will be the selling beneficial
owners for purposes of the Prospectus. 
  
 Notwithstanding
anything to the contrary herein, the Registration Statement shall cover only the Shares and the Warrant Shares. In no event at any time before the Registration Statement becomes effective with respect to the Shares and the Warrant Shares shall the
Company publicly announce or file any other registration statement, other than registrations on Form S-8, without the prior written consent of a majority in interest of the Investors. The Investor acknowledges and agrees that the Company shall not
be regarded to have breached its “best efforts” obligation under Section 7.1(b) if, owing to a review of the Registration Statement by the SEC staff, the Registration Statement does not become effective within 45 days after the
Registration Statement is filed with the SEC, provided that following receipt of notice of such review, the Company shall have used its best efforts to cause the Registration Statement to become effective at the earliest practicable date.

  
 The Company understands that the Investor disclaims being an
underwriter, but if the SEC deems the Investor to be an underwriter, the Company shall not be relieved of any obligations it has hereunder; provided, however that if the Company receives notification from the SEC that the Investor is
deemed an underwriter, then the period by which the Company is obligated to submit an acceleration request to the SEC shall be extended to the earlier of (i) the 90th day after such SEC notification, or (ii) 120 days after the initial filing of the
Registration Statement with the SEC. 
  
 Within five business days
of the effectiveness date of the Registration Statement, the Company shall cause its counsel to issue a blanket opinion to the transfer agent stating that the shares are subject to an effective registration statement and can be reissued free of
restrictive legend upon notice of a sale by an Investor and confirmation by such Investor that it has complied with the prospectus delivery requirements, provided that the Company has not advised the transfer agent orally or in writing that the
opinion has been withdrawn. 
  
 7.2 Transfer of Shares and
Warrant Shares After Registration; Suspension. 
  
 (a) The
Investor agrees that it will not effect any disposition of the Shares or the Warrant Shares or its right to purchase the Shares or the Warrant Shares that would constitute a sale within the meaning of the Securities Act except as contemplated in the
Registration Statement referred to in Section 7.1 and as described below or as otherwise permitted by law, and that it will promptly notify the Company of any changes in the information set forth in the Registration Statement regarding the Investor
or its plan of distribution. 
  
 (b) Except in the event
that paragraph (c) below applies, the Company shall (i) if deemed necessary by the Company, prepare and file from time to time with the SEC a post-effective amendment to the Registration Statement or a supplement to the related Prospectus or a
supplement or amendment to any document incorporated therein by reference or file any other required document so that such Registration Statement will not contain an untrue statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, and so that, as thereafter delivered to purchasers of the Shares and Warrant Shares being sold thereunder, such Prospectus will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; (ii) provide the Investor copies of any documents filed
pursuant to Section 7.2(b)(i) as the Investor may reasonably request; and (iii) inform each Investor that the Company has complied with its obligations in Section 7.2(b)(i) (or that, if the Company has filed a post-effective amendment to the
Registration Statement which has not yet been declared effective, the Company will notify the Investor to that effect, will use its best efforts to secure the effectiveness of such post-effective amendment as promptly as possible and will promptly
notify the Investor pursuant to Section 7.2(b)(i) hereof when the amendment has become effective). 
  
 (c) Subject to paragraph (d) below, in the event (i) of any request by the SEC or any other federal or state governmental authority during the period of
effectiveness of the Registration Statement for amendments or supplements to a Registration Statement or related Prospectus or for additional information; (ii) of the issuance by the SEC or any other federal or state governmental authority of any
stop order suspending the effectiveness of a Registration Statement or the initiation of any proceedings for that purpose; (iii) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from
qualification of any of the Shares or the Warrant Shares for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; or (iv) of any event or circumstance which, upon the advice of its counsel, necessitates the
making of any changes in the Registration Statement or Prospectus, or any document incorporated or deemed to be incorporated therein by reference, so that, in the case of the Registration Statement, it will not contain any untrue statement of a

  

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 material fact or any omission to state a material fact required to be stated therein or necessary to make the statements
therein not misleading, and that in the case of the Prospectus, it will not contain any untrue statement of a material fact or any omission to state a material fact required to be stated therein or necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading; then the Company shall deliver a certificate in writing to the Investor (the “Suspension Notice”) to the effect of the foregoing and, upon receipt of such Suspension
Notice, the Investor will refrain from selling any Shares and Warrant Shares pursuant to the Registration Statement (a “Suspension”) until the Investor’s receipt of copies of a supplemented or amended Prospectus prepared and filed by
the Company, or until it is advised in writing by the Company that the current Prospectus may be used, and has received copies of any additional or supplemental filings that are incorporated or deemed incorporated by reference in any such
Prospectus. In the event of any Suspension, the Company will use its best efforts to cause the use of the Prospectus so suspended to be resumed as soon as reasonably practicable but in no event later than the 20th business day after the delivery of
a Suspension Notice to the Investor. In addition to and without limiting any other remedies (including, without limitation, at law or at equity) available to the Investor, the Investor shall be entitled to specific performance in the event that the
Company fails to comply with the provisions of this Section 7.2(c).  
  
 (d) Notwithstanding the foregoing paragraphs of this Section 7.2, the Company shall be limited to effecting Suspensions on more than two occasions of not more than 30 days each in any twelve month period, unless, in
the good faith judgment of the Company’s Board of Directors, upon the written opinion of counsel of the Company, the sale of Shares and Warrant Shares under the Registration Statement in reliance on this paragraph 7.2(d) would be reasonably
likely to cause a violation of the Securities Act or the Exchange Act and result in liability to the Company. 
  
 (e) Provided that a Suspension is not then in effect, the Investor may sell Shares and Warrant Shares under the Registration Statement, provided that it
arranges for delivery of a current Prospectus to the transferee of such Shares or Warrant Shares. Upon receipt of a reasonable request therefor, the Company has agreed to provide an adequate number of current Prospectuses to the Investor and to
supply copies to any other parties reasonably requiring such Prospectuses. 
  
 (f) In the event (i) of the initial sale of Shares or Warrant Shares by the Investor pursuant to the Registration Statement provided the Investor makes the representations and warranties set forth in Appendix I
to the Certificate of Subsequent Sale substantially in the form attached hereto as Exhibit A (the “Certificate of Subsequent Sale”) by delivering such Appendix I to the Company, or (ii) upon each sale of Shares or Warrant
Shares by the Investor if the Investor has not made the representations and warranties set forth in Appendix I to the Certificate of Subsequent Sale or the representations and warranties previously provided by the Investor are no longer
accurate, the Investor must also deliver to the Company’s transfer agent, with a copy to the Company, a Certificate of Subsequent Sale, so that the Shares and Warrant Shares may be properly transferred. 
  
 7.3 Indemnification. For the purpose of this Section 7.3: 

 
 (i) the term “Selling Stockholder” means the Investor and any
affiliate of such Investor; 
  
 (ii) the term “Registration
Statement” shall include the Prospectus in the form first filed with the SEC pursuant to Rule 424(b) of the Securities Act or filed as part of the Registration Statement at the time of effectiveness if no Rule 424(b) filing is required, and any
exhibit, supplement or amendment included in or relating to the Registration Statement referred to in Section 7.1; and 
  
 (iii) the term “untrue statement” shall include any untrue statement or alleged untrue statement, or any omission or alleged omission to state
in the Registration Statement a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. 
  
 (a) The Company agrees to indemnify and hold harmless each Selling
Stockholder from and against any losses, claims, damages or liabilities to which such Selling Stockholder may become subject (under the Securities Act or otherwise) insofar as such losses, claims, damages or liabilities (or actions or proceedings in
respect thereof) arise out of, or are based upon (i) any breach of the representations or warranties of the Company contained herein or failure to comply with the covenants and agreements of the Company contained herein, (ii) any untrue statement of
a material fact contained in the Registration Statement as amended at the time of effectiveness or any omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, or (iii) any failure by the
Company to fulfill any undertaking included in the Registration Statement as amended at the time of effectiveness, and the Company will reimburse such Selling Stockholder for any reasonable legal or other expenses reasonably incurred in
investigating, defending or preparing to defend any such action, proceeding or claim, or preparing to defend any such action, proceeding or claim, provided, however, that the Company shall not be liable to a Selling Stockholder in any
such case to the extent that such loss, claim, damage or liability arises out of, or is based upon, an untrue statement made in such Registration Statement or any omission of a material fact required to be stated therein or necessary to make the
statements therein not misleading in reliance upon and in conformity with written information furnished to the Company by or on behalf of such Selling Stockholder specifically for use in preparation of the Registration Statement, as 
  

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 amended or supplemented from time to time (including, without limitation, information set forth in the Investor
Questionnaire) or the failure of such Selling Stockholder to comply with its covenants and agreements contained in Section 7.2 hereof respecting sale of the Shares or Warrant Shares or any statement or omission in any Prospectus that is corrected in
any subsequent Prospectus that was delivered to the Selling Stockholder prior to the pertinent sale or sales by the Selling Stockholder. The Company shall reimburse each Selling Stockholder for the indemnifiable amounts provided for herein on demand
as such expenses are incurred. 
  
 (b) The Investor agrees to
indemnify and hold harmless the Company (and each person, if any, who controls the Company within the meaning of Section 15 of the Securities Act, each officer of the Company who signs the Registration Statement and each director of the Company)
from and against any losses, claims, damages or liabilities to which the Company (or any such officer, director or controlling person) may become subject (under the Securities Act or otherwise), insofar as such losses, claims, damages or liabilities
(or actions or proceedings in respect thereof) arise out of, or are based upon, (i) any failure by Investor to comply with the covenants and agreements contained in Section 7.2 hereof respecting sale of the Shares and Warrant Shares, or (ii) any
untrue statement of a material fact contained in the Registration Statement or any omission of a material fact required to be stated therein or necessary to make the statements therein not misleading if such untrue statement or omission was made in
reliance upon and in conformity with written information furnished by or on behalf of the Investor specifically for use in preparation of the Registration Statement as amended or supplemented from time to time (including, without limitation,
information set forth in the Investor Questionnaire), and the Investor will reimburse the Company (or such officer, director or controlling person), as the case may be, for any legal or other expenses reasonably incurred in investigating, defending
or preparing to defend any such action, proceeding or claim. The Investor shall reimburse the Company or such officer, director or controlling person, as the case may be, for the indemnifiable amounts provided for herein on demand as such expenses
are incurred. Notwithstanding the foregoing, the Investor’s aggregate obligation to indemnify the Company and such officers, directors and controlling persons shall be limited to the net amount received by the Investor from the sale of the
Shares and Warrant Shares. 
  
 (c) Promptly after receipt by any
indemnified person of a notice of a claim or the beginning of any action in respect of which indemnity is to be sought against an indemnifying person pursuant to this Section 7.3, such indemnified person shall notify the indemnifying person in
writing of such claim or of the commencement of such action, but the omission to so notify the indemnifying person will not relieve it from any liability which it may have to any indemnified person under this Section 7.3 (except to the extent that
such omission materially and adversely affects the indemnifying person’s ability to defend such action) or from any liability otherwise than under this Section 7.3. Subject to the provisions hereinafter stated, in case any such action shall be
brought against an indemnified person, the indemnifying person shall be entitled to participate therein, and, to the extent that it shall elect by written notice delivered to the indemnified person promptly after receiving the aforesaid notice from
such indemnified person, shall be entitled to assume the defense thereof, with counsel reasonably satisfactory to such indemnified person. After notice from the indemnifying person to such indemnified person of its election to assume the defense
thereof, such indemnifying person shall not be liable to such indemnified person for any legal expenses subsequently incurred by such indemnified person in connection with the defense thereof, provided, however, that if there exists or
shall exist a conflict of interest that would make it inappropriate, in the opinion of counsel to the indemnified person, for the same counsel to represent both the indemnified person and such indemnifying person or any affiliate or associate
thereof, the indemnified person shall be entitled to retain its own counsel at the expense of such indemnifying person; provided, however, that no indemnifying person shall be responsible for the fees and expenses of more than one separate counsel
(together with appropriate local counsel) for all indemnified parties. In no event shall any indemnifying person be liable in respect of any amounts paid in settlement of any action unless the indemnifying person shall have approved the terms of
such settlement; provided that such consent shall not be unreasonably withheld or delayed. No indemnifying person shall, without the prior written consent of the indemnified person, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified person is or could have been a party and indemnification could have been sought hereunder by such indemnified person, unless such settlement includes an unconditional release of such indemnified person
from all liability on claims that are the subject matter of such proceeding. 
  
 (d) If the indemnification provided for in this Section 7.3 is unavailable to or insufficient to hold harmless an indemnified person under subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) referred to therein, then each indemnifying person shall contribute to the amount paid or payable by such indemnified person as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the relative fault of the Company on the one hand and the Investor, as well as any other Selling Stockholders under such Registration Statement on the other in connection
with the statements or omissions or other matters which resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative fault shall be determined by
reference to, among other things, in the case of an untrue statement, whether the untrue statement relates to information supplied by the Company on the one hand or an Investor or other Selling Stockholder on the other and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent such untrue statement. The Company and the Investor agree that it would not be just and equitable if contribution pursuant to this subsection (d) were determined by pro
rata allocation (even if the Investor and other Selling Stockholders were treated as one entity for such purpose) or by any other method of allocation which does not take into account the equitable considerations referred to above in this subsection
(d). The amount paid or payable by an indemnified person as a result of the losses, claims, 
  

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 damages or liabilities (or actions in respect thereof) referred to above in this subsection (d) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified person in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this subsection (d), the Investor shall not be required to
contribute any amount in excess of the amount by which the net amount received by the Investor from the sale of the Shares and Warrant Shares to which such loss relates exceeds the amount of any damages which such Investor has otherwise been
required to pay by reason of such untrue statement. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Investor’s obligations in this subsection to contribute shall be in proportion to its Investor sale of Shares and Warrant Shares to which such loss relates and shall not be joint with any other Selling Stockholders.

  
 (e) The parties to this Agreement hereby acknowledge that
they are sophisticated business persons who were represented by counsel during the negotiations regarding the provisions hereof including, without limitation, the provisions of this Section 7.3, and are fully informed regarding said provisions. They
further acknowledge that the provisions of this Section 7.3 fairly allocate the risks in light of the ability of the parties to investigate the Company and its business in order to assure that adequate disclosure is made in the Registration
Statement as required by the Securities Act and the Exchange Act. The parties are advised that federal or state public policy as interpreted by the courts in certain jurisdictions may be contrary to certain of the provisions of this Section 7.3, and
the parties hereto hereby expressly waive and relinquish any right or ability to assert such public policy as a defense to a claim under this Section 7.3 and further agree not to attempt to assert any such defense. 
  
 7.4 Termination of Conditions and Obligations. The conditions
precedent imposed by Section 5 or this Section 7 upon the transferability of the Shares and Warrant Shares shall cease and terminate as to any particular number of the Shares or Warrant Shares when such shares shall have been effectively registered
under the Securities Act and sold or otherwise disposed of in accordance with the intended method of disposition set forth in the Registration Statement covering such shares or at such time as an opinion of counsel reasonably satisfactory to the
Company shall have been rendered to the effect that such conditions are not necessary in order to comply with the Securities Act. 
  
 7.5 Information Available. So long as the Registration Statement is effective covering the resale of Shares and Warrant Shares owned by the
Investor, the Company will furnish to the Investor: 
  
 (a) as
soon as practicable after it is available, one copy of (i) its Annual Report to Stockholders (which Annual Report shall contain financial statements audited in accordance with generally accepted accounting principles by a national firm of certified
public accountants), (ii) its Annual Report on Form 10-K and (iii) its Quarterly Reports on Form 10-Q (the foregoing, in each case, excluding exhibits); 
  
 (b) upon the request of the Investor, all exhibits excluded by the parenthetical to subparagraph (a) of this Section 7.5 as filed with the SEC and all
other information that is made available to shareholders; and 
  
 (c) upon the reasonable request of the Investor, an adequate number of copies of the Prospectuses to supply to any other party requiring such Prospectuses; and upon the reasonable request of the Investor, the President or the Principal
Financial Officer of the Company (or an appropriate designee thereof) will meet with the Investor or a representative thereof at the Company’s headquarters to discuss all information relevant for disclosure in the Registration Statement
covering the Shares and Warrant Shares and will otherwise cooperate with any Investor conducting an investigation for the purpose of reducing or eliminating such Investor’s exposure to liability under the Securities Act, including the
reasonable production of information at the Company’s headquarters; provided, that the Company shall not be required to disclose any confidential information to or meet at its headquarters with any Investor until and unless the Investor shall
have entered into a confidentiality agreement in form and substance reasonably satisfactory to the Company with the Company with respect thereto. 
  
 7.6 Legend; Restrictions on Transfer. The certificate or certificates for the Shares and Warrant Shares (and any securities issued in respect of or
exchange for the Shares or Warrant Shares) shall be subject to a legend or legends restricting transfer under the Securities Act and referring to restrictions on transfer herein, such legend to be substantially as follows: 
  
 THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 (THE “ACT”) AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR, IN THE OPINION OF COUNSEL, IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE
SECURITIES, SUCH OFFER, SALE OR TRANSFER OR HYPOTHECATION IS IN COMPLIANCE THEREWITH; PROVIDED THAT SUCH OPINION OF COUNSEL SHALL NOT BE REQUIRED IN CONNECTION WITH A PLEDGE OF THESE SECURITIES PURSUANT TO A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR
FINANCING ARRANGEMENT SECURED BY SUCH SECURITIES, IN EACH CASE, IN COMPLIANCE WITH THE ACT. 
  

 - 14 - 

 7.7 Default Fees. The Company hereby agrees to pay a fee (“Default Fee”) to the Investor
under the following circumstances: (a) if the Registration Statement is not filed by the Company on or prior to 30 days after the Closing Date in accordance with Section 7.1(a) (such an event, a “Filing Default”); (b) if the Registration
Statement is not declared effective by the SEC on or prior to 60 days after the Closing Date in the event the SEC does not undertake a review of the Registration Statement, or 90 days after the Closing Date in the event of an SEC review (either such
event, an “Effectiveness Default”); (c) if the Registration Statement (after its effectiveness date) ceases to be effective and available to the Investor for any continuous period that exceeds 30 days or for one or more period that exceeds
in the aggregate 60 days in any 12-month period (such an event, a “Suspension Default”); or (d) if the Company has not obtained the waivers of certain registration rights required by Section 4.25 hereof within 30 days of the Closing Date
(such an event, a “Waiver Default” and together with a Filing Default, an Effectiveness Default and a Suspension Default, a “Registration Default”). In the event of a Registration Default, the Company shall pay the Default Fee to
the Investor, for each 30-day period of a Registration Default, an amount in cash equal to 1% of the aggregate purchase price paid by the Investor for the Shares pursuant to this Agreement; provided that in no event shall the aggregate amount of
cash to be paid as Default Fees pursuant to this Section 7.7 exceed 9% of the aggregate purchase price paid by the Investor for the Shares. For avoidance of doubt, the Default Fee shall not be based on any amounts paid by the Investor to purchase
the Warrant or the Warrant Shares. The Company shall pay the Default Fee as follows: (i) in connection with a Filing Default, on the 31st day after the Closing Date, and each 30th day thereafter until the Registration Statement is filed with the SEC; (ii) in connection with an Effectiveness Default, on the 61st day after the Closing Date in the event the SEC
does not undertake a review of the Registration Statement, or on the 91st day after the Closing Date in the event of an SEC review, and, in either case, each 30th day thereafter until the Registration Statement is declared effective by the SEC;
(iii) in connection with a Suspension Default, on either (x) the 31st consecutive day of any Suspension or (y) the
61st day (in the aggregate) of any Suspensions in any 12-month period, and each 30th day thereafter until the Suspension is terminated in accordance with Section 7.2; or (iv) in connection with a Waiver Default,
on the 31st day after the Closing Date, and each 30th day thereafter until the waivers required by Section 4.25
hereof are obtained. Notwithstanding the foregoing, all periods shall be tolled in the event of any delays directly caused by the action or inaction of an Investor to return a completed Selling Stockholder Notice and Questionnaire in substantially
the form of Exhibit C attached hereto, and the Company shall have no liability to any Investor in respect of any such delay. The Default Fees payable herein shall apply on a pro rata basis for any portion of a 30-day period of a Registration
Default. Notwithstanding the foregoing, the Investor shall be entitled to specific performance and any other remedies at law or in equity in the event the Company fails to comply with the provisions of Section 7.1 or 7.2. 
  
 8. Notices. All notices, requests, consents and other communications
hereunder shall be in writing, shall be mailed (A) if within the United States by first-class registered or certified airmail, or nationally recognized overnight express courier, postage prepaid, or by facsimile, or (B) if delivered from outside the
United States, by International Federal Express (or other recognized international express courier) or facsimile, and shall be deemed given (i) if delivered by first-class registered or certified mail, three business days after so mailed, (ii) if
delivered by nationally recognized overnight carrier, one business day after so mailed, (iii) if delivered by International Federal Express (or other recognized international express courier), two business days after so mailed, (iv) if delivered by
facsimile, upon electronic confirmation of receipt and shall be delivered as addressed as follows: 
  

	 	(a)	if to the Company, to: 

  
 RITA Medical Systems, Inc. 
 967 N. Shoreline Blvd. 
 Mountain View, CA 94043 
 Attn: Chief Financial Officer 
 Fax: (650) 967-1961 
  

	 	(b)	with a copy to: 

  
 Heller Ehrman White & McAuliffe LLP 
 2775 Sand Hill Road 
 Menlo Park, CA 94025 
 Attn: Mark B. Weeks, Esq. 
 Fax: (650) 233-8386 
  

	 	(c)	if to the Investor, at its address on the signature page hereto, or at such other address or addresses as may have been furnished to the Company in writing.

  

 - 15 - 

 9. Changes. This Agreement may be modified, amended or waived only pursuant to a written
instrument signed by the Company and (a) Investors holding a majority of the Shares issued and sold in the Offering, provided that such modification, amendment or waiver is made with respect to all Agreements and does not adversely affect the
Investor without adversely affecting all Investors in a similar manner; or (b) the Investor. 
  
 10. Headings. The headings of the various sections of this Agreement have been inserted for convenience of reference only and shall not be deemed to be part of this Agreement. 
  
 11. Severability. In case any provision contained in this Agreement
should be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby. 
  
 12. Governing Law. This Agreement shall be governed by, and construed
in accordance with, the internal laws of the State of Delaware, without giving effect to the principles of conflicts of law. 
  
 13. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall constitute an original, but all of which, when
taken together, shall constitute but one instrument, and shall become effective when one or more counterparts have been signed by each party hereto and delivered to the other parties. 
  
 14. Entire Agreement. This Agreement and the Warrants constitute the entire agreement between the parties hereto and
supersedes any prior understandings or agreements concerning the purchase and sale of the Shares and the Warrants and the resale registration of the Shares and Warrant Shares. 
  
 15. Rule 144. The Company covenants that it will timely file the reports required to be filed by it under the
Securities Act and the Exchange Act and the rules and regulations adopted by the SEC thereunder (or, if the Company is not required to file such reports, it will, upon the request of any Investor holding Shares purchased hereunder or Warrant Shares
purchased under the Warrants made after the first anniversary of the Closing Date, make publicly available such information as necessary to permit sales pursuant to Rule 144 under the Securities Act), and it will take such further action as any such
Investor may reasonably request, all to the extent required from time to time to enable such Investor to sell such Shares and Warrant Shares without registration under the Securities Act within the limitation of the exemptions provided by (a) Rule
144 under the Securities Act, as such Rule may be amended from time to time, or (b) any similar rule or regulation hereafter adopted by the SEC. Upon the request of the Investor, the Company will deliver to such holder a written statement as to
whether it has complied with such information and requirements. 
  
 16. Confidential Information. 
  
 (a) The
Investor represents to the Company that, at all times during the Company’s offering of the Shares and the Warrants, the Investor has maintained in confidence all non-public information regarding the Company received by the Investor from the
Company or its agents, and covenants that it will continue to maintain in confidence such information until such information (a) becomes generally publicly available other than through a violation of this provision by the Investor or its agents or
(b) is required to be disclosed in legal proceedings (such as by deposition, interrogatory, request for documents, subpoena, civil investigation demand, filing with any governmental authority or similar process), provided, however, that before
making any use or disclosure in reliance on this subparagraph (b) the Investor shall give the Company at least fifteen (15) days prior written notice (or such shorter period as required by law) specifying the circumstances giving rise thereto and
will furnish only that portion of the non-public information which is legally required and will exercise its best efforts to obtain reliable assurance that confidential treatment will be accorded any non-public information so furnished. 

 
 (b) The Company shall on the Closing Date issue a press release, and
within one business day following the Closing Date, file with the SEC a Form 8-K (which shall include as exhibits this Agreement and the form of the Warrant), in each case, disclosing the material terms of the transactions contemplated hereby
(including at least the number of Shares and Warrants sold and proceeds therefrom). The press release and the Form 8-K shall be provided to counsel to the Investor for review and approval with a reasonable amount of time to complete such review and
approval, provided, however, that such Investor’s review will not prevent the Company from meeting its filing deadlines as set forth in the preceding sentence. The Company shall not publicly disclose the name of the Investor, or include the
name of the Investor in any filing with the SEC or any regulatory agency or the Nasdaq (other than the filing of the Agreements with the SEC pursuant to the Exchange Act), without the prior written consent of the Investor, except to the extent such
disclosure is required by law or Nasdaq regulations. 
  
 17. No
Third-Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other person.

  

 - 16 - 

 RITA Medical Systems, Inc. 
  
 INVESTOR QUESTIONNAIRE 
  
 (ALL INFORMATION WILL BE TREATED CONFIDENTIALLY) 
  

	To:	RITA Medical Systems, Inc. 

 967 N. Shoreline Blvd.

 Mountain View, CA 94043 
  
 This Investor Questionnaire (“Questionnaire”) must be completed by each potential investor in connection with the offer and sale of the shares
of the common stock, par value $0.001 per share (the “Common Stock”), of RITA Medical Systems, Inc., together with warrants to purchase shares of Common Stock (collectively, the “Securities”). The Securities are being offered and
sold by RITA Medical Systems, Inc. (the “Corporation”) without registration under the Securities Act of 1933, as amended (the “Act”), and the securities laws of certain states, in reliance on the exemptions contained in Section
4(2) of the Act and on Regulation D promulgated thereunder and in reliance on similar exemptions under applicable state laws. The Corporation must determine that a potential investor meets certain suitability requirements before offering or selling
Securities to such investor. The purpose of this Questionnaire is to assure the Corporation that each investor will meet the applicable suitability requirements. The information supplied by you will be used in determining whether you meet such
criteria, and reliance upon the private offering exemption from registration is based in part on the information herein supplied. 
  
 This Questionnaire does not constitute an offer to sell or a solicitation of an offer to buy any security. Your answers will be kept strictly
confidential. However, by signing this Questionnaire you will be authorizing the Corporation to provide a completed copy of this Questionnaire to such parties as the Corporation deems appropriate in order to ensure that the offer and sale of the
Securities will not result in a violation of the Act or the securities laws of any state and that you otherwise satisfy the suitability standards applicable to purchasers of the Securities. All potential investors must answer all applicable
questions and complete, date and sign this Questionnaire. Please print or type your responses and attach additional sheets of paper if necessary to complete your answers to any item. 
  
 A. BACKGROUND INFORMATION 
  
 Name:______________________________________________________________________________________________________________________________ 
  
 Business
Address:                                      
                                        
                                        
                                        
                 
 (Number and Street) 
  
                                       
                                        
                                        
                                        
                                        
                                        
                    

					
	 (City)
	 	(State)	 	(Zip Code)

  
 Telephone Number: (            )
                                        
                                        
                                        
                                        
       
  
 Residence
Address:                                      
                                        
                                        
                                        
               
 (Number and Street) 
  
                                       
                                        
                                        
                                        
                                        
                                        
                    

					
	 (City)
	 	(State)	 	(Zip Code)

  
 Telephone Number: (            )
                                        
                                        
                                        
                                        
       
  
 If an
individual: 
  

					
	 Age:
                        
	 	 Citizenship:
                    
	 	 Where registered to vote:
                 

  
 If a corporation, partnership, limited
liability company, trust or other entity: 
  

			
	 Type of
entity:                                       
                                        
                                        
                                        
         

	  
 State of
formation:                                      
                   
	  	 Date of
formation:                                      
                         

  
 Social Security or Taxpayer Identification
No.                                       
                                        
                                        
                      
  

					
	 Send all correspondence to (check one):       
	 	Residence Address
                            	 	 Business Address

  

 - 17 - 

 Current ownership of securities of the Corporation: 
  
              shares of common stock, par value $0.001 per
share (the “Common Stock”) 
 options to purchase             
shares of Common Stock 
  

	B.	STATUS AS ACCREDITED INVESTOR 

  
 The undersigned is an “accredited investor” as such term is defined in Regulation D under the Act, as at the time of the sale of the
Securities the undersigned falls within one or more of the following categories (Please initial one or more, as applicable):1 
  
              (1) a bank as defined in Section 3(a)(2) of the Act, or a savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Act whether
acting in its individual or fiduciary capacity; a broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934; an insurance company as defined in Section 2(13) of the Act; an investment company registered under the
Investment Corporation Act of 1940 or a business development company as defined in Section 2(a)(48) of that Act; a Small Business Investment Corporation licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small
Business Investment Act of 1958; a plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions for the benefit of its employees, if such plan has total assets in
excess of $5,000,000; an employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974 if the investment decision is made by a plan fiduciary, as defined in Section 3(21) of such Act, which is either a bank, savings
and loan association, insurance company, or registered investment adviser, or if the employee benefit plan has total assets in excess of $5,000,000 or, if a self-directed plan, with the investment decisions made solely by persons that are accredited
investors; 
  
              (2) a private business development company as defined in Section 202(a)(22) of the Investment Adviser Act of 1940; 
  
              (3) an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, corporation, Massachusetts or similar business trust, or
partnership, not formed for the specific purpose of acquiring the Securities offered, with total assets in excess of $5,000,000; 
  
              (4) a natural person whose individual net worth1, or joint net worth1 with that person’s spouse, at the time of such person’s purchase of the Securities exceeds $1,000,000; 
  
              (5) a natural person who had an individual income in excess of $200,000 in
each of the two most recent years or joint income with that person’s spouse in excess of $300,000 in each of those years and has a reasonable expectation of reaching the same income level in the current year; 
  
              (6) a trust, with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the Securities offered, whose purchase is directed by a
sophisticated person as described in Rule 506(b)(2)(ii) of Regulation D; and 
  
              (7) an entity in which all of the equity owners are accredited investors (as defined above). 
  

	C.	REPRESENTATIONS 

  
 The undersigned hereby represents and warrants to the Corporation as follows: 
  

	1.	Any purchase of the Securities would be solely for the account of the undersigned and not for the account of any other person or with a view to any resale, fractionalization,
division, or distribution thereof. 

  

	1	As used in this Questionnaire, the term “net worth” means the excess of total assets over total liabilities. In computing net worth for the purpose of
subsection (4), the principal residence of the investor must be valued at cost, including cost of improvements, or at recently appraised value by an institutional lender making a secured loan, net of encumbrances. In determining income, the investor
should add to the investor’s adjusted gross income any amounts attributable to tax exempt income received, losses claimed as a limited partner in any limited partnership, deductions claimed for depiction, contributions to an IRA or KEOGH
retirement plan, alimony payments, and any amount by which income from long-term capital gains has been reduced in arriving at adjusted gross income. 

  

 - 18 - 

	2.	The information contained herein is complete and accurate and may be relied upon by the Corporation, and the undersigned will notify the Corporation immediately of any material
change in any of such information occurring prior to the closing, if any, with respect to the purchase of Securities by the undersigned or any co-purchaser. 

  

	3.	There are no suits, pending litigation, or claims against the undersigned that could materially affect the net worth of the undersigned as reported in this Questionnaire.

  

	4.	The undersigned acknowledges that there may occasionally be times when the Corporation determines that it must suspend the use of the Prospectus forming a part of the Registration
Statement (as such terms are defined in the Stock and Warrant Purchase Agreement to which this Questionnaire is attached), as set forth in Section 7.2(c) of the Stock and Warrant Purchase Agreement. The undersigned is aware that, in such event, the
Securities will not be subject to ready liquidation, and that any Securities purchased by the undersigned would have to be held during such suspension. The overall commitment of the undersigned to investments which are not readily marketable is not
excessive in view of the undersigned’s net worth and financial circumstances, and any purchase of the Securities will not cause such commitment to become excessive. The undersigned is able to bear the economic risk of an investment in the
Securities. 

  

	5.	The undersigned has carefully considered the potential risks relating to the Corporation and a purchase of the Securities, and fully understands that the Securities are speculative
investments which involve a high degree of risk of loss of the undersigned’s entire investment. Among others, the undersigned has carefully considered each of the risks identified in the Exchange Act Documents. 

  
 IN WITNESS WHEREOF, the undersigned has executed this
Questionnaire this              day of November, 2004, and declares under oath that it is truthful and correct. 
  

			
	  

	 Print Name

		
	 By:
	 	  

	 	 	 Signature

		
	 Title:
	 	  

	 	 	(required for any purchaser that is a corporation, partnership, trust or other entity)

  

 - 19 - 

 [Company Letterhead] 
  
             , 200    

  

	 	Re:	RITA Medical Systems, Inc.; Registration Statement on Form S-3 

  
 Dear Selling Stockholder: 
  
 Enclosed please find five (5) copies of a prospectus dated
                    ,              (the “Prospectus”) for
your use in reselling your shares of common stock, $0.001 par value (the “Shares”), of RITA Medical Systems, Inc. (the “Company”), under the Company’s Registration Statement on Form S-3 (Registration No. 333-
            ) (the “Registration Statement”), which has been declared effective by the Securities and Exchange Commission. As a selling shareholder under the
Registration Statement, you have an obligation to deliver a copy of the Prospectus to each purchaser of your Shares, either directly or through the broker-dealer who executes the sale of your Shares. 
  
 The Company is obligated to notify you in the event that it suspends trading
under the Registration Statement in accordance with the terms of the Stock and Warrant Purchase Agreement between the Company and you. During the period that the Registration Statement remains effective and trading thereunder has not been suspended,
you will be permitted to sell your Shares which are included in the Prospectus under the Registration Statement. Upon a sale of any Shares under the Registration Statement, you or your broker will be required to deliver to the Transfer Agent, U. S.
Stock Transfer Corporation (1) your restricted stock certificate(s) representing the Shares, and (2) instructions for transfer of the Shares sold, and deliver to U.S. Stock Transfer Corporation and the Company a representation letter from your
broker, or from you if you are selling in a privately negotiated transaction, or from such other appropriate party, in the form of Exhibit A attached hereto (the “Representation Letter”). The Representation Letter confirms
that the Shares have been sold pursuant to the Registration Statement and in a manner described under the caption “Plan of Distribution” in the Prospectus and that such sale was made in accordance with all applicable securities laws,
including the prospectus delivery requirements. 
  
 Please note
that you are under no obligation to sell your Shares during the registration period. However, if you do decide to sell, you must comply with the requirements described in this letter or otherwise applicable to such sale. Your failure to do so may
result in liability under the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. Please remember that all sales of your Shares must be carried out in the manner set forth under the caption “Plan of
Distribution” in the Prospectus if you sell under the Registration Statement. The Company may require an opinion of counsel reasonably satisfactory to the Company if you choose another method of sale. You should consult with your own legal
advisor(s) on an ongoing basis to ensure your compliance with the relevant securities laws and regulations. 
  
 In order to maintain the accuracy of the Prospectus, you must notify the undersigned upon the sale, gift, or other transfer of any Shares by you,
including the number of Shares being transferred, and in the event of any other change in the information regarding you which is contained in the Prospectus. For example, you must notify the undersigned if you enter into any arrangement with a
broker-dealer for the sale of shares through a block trade, special offering, exchange distribution or secondary distribution or a purchase by a broker-dealer. Depending on the circumstances, such transactions may require the filing of a supplement
to the Prospectus in order to update the information set forth under the caption “Plan of Distribution” in the Prospectus. 
  
 Should you need any additional copies of the Prospectus, or if you have any questions concerning the foregoing, please write to me at RITA Medical
Systems, Inc., 967 N. Shoreline Blvd., Mountain View, CA 94043. Thank you. 
  

	
	 Sincerely,

	
	 Chief Financial Officer

  

 - 20 - 

 Exhibit A 
  

CERTIFICATE OF SUBSEQUENT SALE 
  
 U.S. Stock Transfer Corporation 
 1745 Gardena Ave. 
 Glendale, CA 91204-2991 
  

	 	RE:	Sale of Shares of Common Stock of RITA Medical Systems, Inc. (the “Company”) pursuant to the Company’s Prospectus dated
                    ,              (the “Prospectus”)

  
 Dear Sir/Madam: 
  
 The undersigned hereby certifies, in connection with the sale of shares of
Common Stock of the Company included in the table of Selling Stockholders in the Prospectus, that the undersigned has sold the shares pursuant to the Prospectus and in a manner described under the caption “Plan of Distribution” in the
Prospectus and that such sale complies with all securities laws applicable to the undersigned, including, without limitation, the Prospectus delivery requirements of the Securities Act of 1933, as amended. 
  
 Selling Stockholder (the beneficial owner):
__________________________________________ 
  
 Record Holder (e.g., if held in
name of nominee): ______________________________________ 
  
 Restricted Stock
Certificate No.(s): ________________________________________________ 
  
 Number of
Shares Sold: ________________________________________________________ 
  
 Date of
Sale: ________________________________________________________________ 
  
 In the event that you receive a stock certificate(s) representing more shares of Common Stock than have been sold by the undersigned, then you should return to the undersigned a newly issued certificate for such
excess shares in the name of the Record Holder and BEARING A RESTRICTIVE LEGEND. Further, you should place a stop transfer on your records with regard to such certificate. Notwithstanding the foregoing, in the event that the undersigned
executes and delivers to you and to the Company the certification set forth on Appendix I, upon instructions from the Company, you should return to the undersigned a newly issued certificate for such excess shares of Common Stock in the name
of the Record Holder without any restrictive legend. In addition, no subsequent certification will be required to be delivered to you by the undersigned provided that the representations and warranties set forth on Appendix I have been
delivered to you and continue to be accurate. 
  

							
	 	  	 	 	Very truly yours,
				
	Dated:	  	  

	 	By:	 	  

				
	 	  	 	 	Print Name:	 	  

				
	 	  	 	 	Title:	 	  

	cc:	  	RITA Medical Systems, Inc.	 	 	 	 
	 	  	967 N. Shoreline Blvd.	 	 	 	 
	 	  	Mountain View, CA 94043	 	 	 	 
	 	  	Attn: Chief Financial Officer	 	 	 	 

  

 - 21 - 

 Appendix I 
  

In connection with any excess shares to be returned to the Selling Stockholder upon a sale of shares of Common Stock of RITA Medical Systems, Inc. (the
“Company “) included in the table of Selling Stockholders in the Prospectus, the undersigned hereby certifies to the Company and U.S. Stock Transfer Corporation, that: 
  

	 	1.	In connection with the sale by the undersigned stockholder of any of the shares of Common Stock, the undersigned stockholder will deliver a copy of the Prospectus included in the
Registration Statement to the purchaser directly or through the undersigned stockholder’s broker-dealer in compliance with the requirements of the Securities Act of 1933 and the Securities Exchange Act of 1934. 

  

	 	2.	Any such sale will be made only in the manner described under “Plan of Distribution” in the Prospectus. 

  

	 	3.	The undersigned stockholder will only sell the shares of Common Stock while the Registration Statement is effective, unless another exemption from registration is available.

  

	 	4.	The Company and its attorneys may rely on this letter to the same extent as if it were addressed to them. 

  

	 	5.	The undersigned stockholder agrees to notify you immediately of any development or occurrence which to his, her or its knowledge would render any of the foregoing representations
and agreements inaccurate. 

  
 All terms not defined
herein are as defined in the Stock and Warrant Purchase Agreement, among the undersigned and the Company, dated November     , 2004. 
  

							
	 	 	 	 	 Very truly yours,

				
	 Dated: 
	 	
	 	 By:
	 	  

	 	 	 	 	 Print Name:
	 	  

	 	 	 	 	 Title:
	 	  

  

 - 22 - 

 Exhibit B 
  

WARRANT 
  

 - 23 - 

 Exhibit C 
  

SELLING STOCKHOLDER NOTICE AND QUESTIONNAIRE 
  

	
	  

	 Name of Selling Stockholder (please print)

  
 RITA MEDICAL
SYSTEMS, INC. 
  
 QUESTIONNAIRE FOR SELLING STOCKHOLDERS

  
 IMPORTANT: IMMEDIATE ATTENTION REQUIRED 
  
 This Questionnaire is being furnished to all persons or entities (the
“Investors”) electing to include shares of Common Stock (“RITA Common Stock”) of RITA Medical Systems, Inc. (“RITA”) held by them or issuable in connection with a warrant. This Questionnaire relates to certain
information required to be disclosed in the Registration Statement on Form S-3 (the “Form S-3”) being prepared by RITA for filing with the United States Securities and Exchange Commission (the “SEC”) by each of the Investors who
wishes to sell RITA Common Stock pursuant to the Form S-3. We must receive a completed Questionnaire from each stockholder in order to include such stockholder’s shares of RITA Common Stock for registration on the Form S-3. 

  
 The furnishing of accurate and complete responses to the
questions posed in this Questionnaire is an extremely important part of the registration process. The inclusion of inaccurate or incomplete disclosures in the Form S-3 can result in potential liabilities, both civil and criminal, to RITA and to the
individuals who furnish the information. 
  
 PLEASE GIVE A
RESPONSE TO EVERY QUESTION, indicating “None” or “Not Applicable” where appropriate. Please complete, sign, and return one copy of this Questionnaire by facsimile and overnight courier as soon as possible.

  
 Heller Ehrman White & McAuliffe LLP 
 2775 Sand Hill Road 
 Menlo Park, CA 94025

 Attn: K. Amar Murugan 
 Facsimile Number: (650) 324-6054 
  
 Unless stated
otherwise, answers should be given as of the date you complete this Questionnaire. However, it is your responsibility to inform us of any changes that may occur to your situation. If there is any situation about which you have any
doubt, or if you are uncertain as to the meaning of any terms used in this Questionnaire, please contact K. Amar Murugan at (650) 854-4488. 
  

 - 24 - 

 PART I - STOCK OWNERSHIP 
  
 Item 1. Beneficial Ownership. 
  
 a. Deemed Beneficial Ownership. Please state the amount of securities of the Company you own on the date you complete this Questionnaire. (If none,
please so state in each case.) 
  

			
	 Amount Beneficially Owned1

	 	 Number of Shares of
 Common Stock Owned

	 Total Shares:
	 	____________________
		
	 Of such shares:
	 	 
	 Shares as to which you have sole voting power:
	 	____________________
		
	 Shares as to which you have shared voting power:
	 	____________________
		
	 Shares as to which you have sole investment power:
	 	____________________
		
	 Shares as to which you have shared investment power:
	 	____________________

  
 Please state the number of shares
owned by family members, trusts and other organizations with which you have a relationship, and any other shares of which you may be deemed to be the “beneficial owner”1: 
  

			
	 Total Shares:
	 	____________________
		
	 Of such shares:
	 	 
	 Shares as to which you have sole voting power:
	 	____________________
		
	 Shares as to which you have shared voting power:
	 	____________________
		
	 Shares as to which you have sole investment power:
	 	____________________
		
	 Shares as to which you have shared investment power:
	 	____________________
		
	Shares which you will have a right to acquire before [                    ], through
the exercise of options, warrants or otherwise:	 	____________________

  
 Do you have any present plans to
exercise options or otherwise acquire, dispose of or to transfer shares of Common Stock of the Company between the date you complete this Questionnaire and the date which is 60 days after the date in which the Registration Statement is filed.

  
 Answer: 
  

 - 25 - 

 If so, please describe. 
  
 b. Pledged Securities. If any of such securities have been pledged or otherwise deposited as collateral or are the subject matter of any voting
trust or other similar agreement or of any contract providing for the sale or other disposition of such securities, please give the details thereof. 
  
 Answer: 
  
 c. Disclaimer of Beneficial Ownership. Do you wish to disclaim beneficial ownership1 of any of the shares reported in response to Item 1(a)? 
  
 Answer: 
  
 If the answer is “Yes”, please furnish the following information with respect to the person or persons who should be shown as the beneficial
owner(s)1 of the shares in question. 
  

					
	 Name and Address of
 Actual Beneficial
Owner

	  	 Relationship of
 Such Person To You

	  	 Number of Shares
 Beneficially Owned

  
 d. Shared Voting or
Investment Power over Shares or Warrant Shares. Will any person be deemed to have beneficial ownership over any of the Shares, Warrant or Warrant Shares purchased by you pursuant to the Stock and Warrant Purchase Agreement? 
  
 Answer: 
  
 If the answer is “Yes”, please furnish the following information with respect to the person or persons who should
be shown as the beneficial owner(s)1 of the Shares and/or Warrant Shares in question. 
  

					
	 Name and Address of
 Beneficial
Owner

	  	 Relationship of
 Such Person To You

	  	 Number of Shares
 Beneficially Owned

  
 Item 2. Major
Shareholders. Please state below the names of persons or groups known by you to own beneficially1 more than 5%
of the Company’s Common Stock. 
  
 Answer: 
  
 Item 3. Change of Control. Do you know of any contractual arrangements,
including any pledge of securities of the Company, the operation of which may at a subsequent date result in a change of control of the Company? 
  
 Answer: 
  

 - 26 - 

 Item 4. Relationship with the Company. Please state the nature of any position, office or other material
relationship you have, or have had within the past three years, with the Company or its affiliates. 
  

			
	 Name

	 	 Nature of
 Relationship

  
 PART II - CERTAIN
TRANSACTIONS 
  
 Item 6. Transactions with the Company. If you,
any of your associates2, or any member of your immediate family3 had or will have any direct or indirect material interest in any transactions4 or series of transactions to which the Company or any of its subsidiaries was a party at any time since January 1, 2000, or in any currently proposed
transactions or series of transactions in which the Company or any of its subsidiaries will be a party, in which the amount involved exceeds $60,000, please specify (a) the names of the parties to the transaction(s) and their relationship to you,
(b) the nature of the interest in the transaction, (c) the amount involved in the transaction, and (d) the amount of the interest in the transaction. If the answer is “none”, please so state. 
  
 Answer: 
  
  
 Item 7. Third Party Payments. Please describe any
compensation paid to you by a third party pursuant to any arrangement between the Company and any such third party. 
  
 Answer: 
  
  
 PART III – PLAN OF DISTRIBUTION 
  
 The shares of common stock offered hereby may be sold from time to time by the selling stockholders for their own accounts.
RITA will receive none of the proceeds from this offering. RITA will bear substantially all costs and expenses incident to the offering and sale of the shares to the public, including legal fees and disbursements of counsel, “blue sky”
expenses, accounting fees and filing fees, but excluding any brokerage commissions, discounts or similar charges. 
  
 Resale of the shares by the selling stockholders are not subject to any underwriting agreement. The shares of common stock covered by this prospectus may
be sold by the selling stockholders or by their permitted pledgees, donees, transferees, beneficiaries, distributees or successors-in-interest selling shares received after the date of this prospectus from a selling stockholder as a gift, pledge,
partnership distribution or other non-sale related transfer. In addition, certain of the selling stockholders are corporations or partnerships which may, in the future, distribute their shares to their stockholders or partners, respectively. Those
shares may later be sold by those stockholders or partners. The selling stockholders will act independently of us in making decisions with respect to the timing, manner and size of each sale. The shares offered by each selling stockholder may be
sold from time to time: 
  

	 	•	at market prices prevailing at the time of sale, 

  

	 	•	at prices relating to such prevailing market prices, or 

  

	 	•	at negotiated prices. 

  
 Such sales may be effected in the over-the-counter market, on the Nasdaq National Market, or on any exchange on which the shares may then be listed. RITA
will supply the selling stockholders with reasonable quantities of this prospectus. The shares may be sold by one or more of the following: 
  

	 	•	one or more block trades in which a broker or dealer so engaged will attempt to sell all or a portion of the shares held by the selling stockholders as agent but may position and
resell a portion of the block as principal to facilitate the transaction; 

  

 - 27 - 

	 	•	purchases by a broker or dealer as principal and resale by such broker or dealer for its account pursuant to this prospectus; 

  

	 	•	ordinary brokerage transactions and transactions in which the broker solicits purchasers; 

  

	 	•	in negotiated transactions; and 

  

	 	•	through other means. 

  
 To the extent permitted by law, the selling stockholders may enter into hedging transactions when selling the shares. For example, the selling
stockholders may: 
  

	 	•	sell shares short and redeliver such shares to close out their short positions; 

  

	 	•	enter into transactions involving short sales by the brokers or dealers; 

  

	 	•	enter into option or other types of transactions that require the selling stockholders to deliver shares to a broker or dealer, who then resells or transfer the shares under this
prospectus; or 

  

	 	•	loan or pledge the shares to a broker or dealer, who may sell the loaned shares or, in the event of default, sell the pledged shares. 

  
 There is no assurance that any of the selling stockholders will sell any or
all of the shares offered by them. 
  
 The selling stockholders
may effect sales through customary brokerage channels, either through broker-dealers acting as agents or brokers, or through broker-dealers acting as principals, who may then resell the shares, or at private sales or otherwise, at market prices
prevailing at the time of sale, at prices related to such prevailing market prices or at negotiated prices. The selling stockholders may effect such transactions by selling shares to or through broker-dealers, and such broker-dealers may receive
compensation in the form of underwriting discounts, concessions, commissions or fees from the selling stockholders and/or purchasers of the shares for whom such broker-dealers may act as agent or to whom they sell as principal, or both (which
compensation to a particular broker-dealer might be in excess of customary commissions). The selling stockholders may further agree to indemnify any broker-dealer or agent against certain liabilities related to the selling of the common stock,
including liabilities arising under the Securities Act of 1933. Any broker-dealers that participate with the selling stockholders in the distribution of the shares may be deemed to be underwriters, and any commissions received by them and any profit
on the resale of the shares positioned by them might be deemed to be underwriting compensation, within the meaning of the Securities Act of 1933, in connection with such sales. To the extent required, this prospectus may be amended or supplemented
from time to time to describe a specific plan of distribution. 
  
 Any shares covered by the prospectus that qualify for resale pursuant to Rule 144 under the Securities Act of 1933, as amended, may be sold under Rule 144 rather than pursuant to this prospectus. In addition to selling the shares of common
stock, the selling stockholders may transfer the shares by gift, distribution or other transfer not involving market makers or established trading markets. 
  
 I have reviewed the Plan of Distribution set forth above and do not have a present intention of effecting a sale in a manner not described therein. 
  
                     
Agree                                     Disagree

  
 (If left blank, response will be deemed to be
“Agree”.) 
  
 I hereby represent that I understand,
pursuant to Interpretation A.65 in the Securities and Exchange Commission, Division of Corporation Finance, Manual of Publicly Available Telephone Interpretations dated July 1997, a copy of which is attached hereto as Exhibit A, that I may
not make any short sale of the Shares prior to the effectiveness of the Registration Statement, and further covenant to the Company that I will not engage in any short sales of such stock to be registered under the Registration Statement prior to
its effectiveness. 
  

 - 28 - 

 SIGNATURE 
  

I understand that RITA anticipates filing the Form S-3 on or about November     , 2004. If at any time any of the
information set forth in my responses to this Questionnaire has changed due to passage of time, or any development occurs which requires a change in any of my answers, or has for any other reason become incorrect, I agree immediately to furnish to
the individual to whom a copy of this Questionnaire is to be sent, as indicated and at the address shown on the first page hereof, any necessary or appropriate correcting information. Otherwise, RITA is to understand that the above information
continues to be, to the best of my knowledge, information and belief, complete and correct. 
  
 I understand that the information that I am furnishing to you herein will be used by RITA in the preparation of its Registration Statement on Form S-3. 
  

							
	 	 	 Name of Stockholder:                                 
                                        
  

		
	 Date: November     , 2004
	 	 Signature:                                     
                                        
                  

		
	 	 	 Print Name:                                    
                                        
                 

		
	 	 	 Title (if applicable):                                 
                                        
        

		
	 	 	 Address:

		
	 	 	 _________________________________________________
 Street

		
	 	 	 _________________________________________________
 City
                        State
                                        Zip
 Code

		
	 	 	 _________________________________________________
 Telephone Number

		
	 	 	 _________________________________________________
 Facsimile Number

  

 - 29 - 

 FOOTNOTES 
  

  

	1.	Beneficial Ownership. You are the beneficial owner of a security, as defined in Rule 13d-3 under the Securities Exchange Act of 1934 (the “Exchange Act”), if you,
directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise have or share: (1) voting power, which includes the power to vote, or to direct the voting of, such security, and/or (2) investment power, which
includes the power to dispose, or to direct the disposition of, such security. You are also the beneficial owner of a security if you, directly or indirectly, create or use a trust, proxy, power of attorney, pooling arrangement or any other
contract, arrangement, or device with the purpose or effect of divesting yourself of beneficial ownership of a security or preventing the vesting of such beneficial ownership. 

  
 You are deemed to be the beneficial owner of a security if you have the
right to acquire beneficial ownership of such security at any time within sixty days including, but not limited to, any right to acquire such security (a) through the exercise of any option, warrant or right, (b) through the conversion of a
security, or (c) pursuant to the automatic termination of, or the power to revoke a trust, discretionary account, or similar arrangement. 
  
 Ordinarily, shares held in the name of your spouse or minor child should be considered as beneficially owned by you absent special circumstances to
indicate that you do not have, as a practical matter, voting power or investment power over such shares. Similarly, absent countervailing facts, securities held in the name of relatives who share your home are to be reported as being beneficially
owned by you. In addition, securities held for your benefit in the name of others, such as nominees, trustees and other fiduciaries, securities held by a partnership of which you are a partner, and securities held by a corporation controlled by you
should be regarded as beneficially owned by you. 
  
 This
definition of beneficial ownership is very broad; therefore, even through you may not actually have or share voting or investment power with respect to securities owned by persons in your family or living in your home, you should include such shares
in your beneficial ownership disclosure and may then disclaim beneficial ownership of such securities. 
  

	2.	Associate. The term “associate”, as defined in Rule 14a-1 under the Exchange Act, means (a) any corporation or organization (other than the Company or any of its
majority owned subsidiaries) of which you are an officer or partner or are, directly or indirectly, the beneficial owner of 10% or more of any class of equity securities, (b) any trust or other estate in which you have a substantial beneficial
interest or as to which you serve as trustee or in a similar capacity, and (c) your spouse, or any relative of yours or relative of your spouse living in your home or who is a director or officer of the Company or of any subsidiary. The term
“relative of yours” as used in this Questionnaire refers to any relative or spouse of yours, or any relative of such spouse, who has the same home as you or who is a director or officer of any subsidiary of the Company.

  
 Please identify your associate referred to in
your answer and indicate your relationship. 
  

	3.	Immediate Family. The members of your “immediate family” are deemed to include the following: your spouse; your parents; your children; your siblings; your
mother-in-law or father-in-law; your sons and daughters-in-law; and your brothers and sisters-in-law. 

  

	4.	Transactions. The term “transaction” is to be understood in its broadest sense, and includes the direct or indirect receipt of anything of value. Please note that
indirect as well as direct material interests in transactions are to be disclosed. Transactions in which you would have a direct interest would include your purchasing or leasing anything (stock in a business acquired by the Company, office space,
plants, Company apartments, computers, raw materials, finished goods, etc.) from or selling or leasing anything to, or borrowing or lending cash or other property from or to, the Company, or any subsidiary. 

  

	cc:	RITA Medical Systems, Inc. 

 967 N. Shoreline Blvd.

 Mountain View, CA 94043 
 Attn:
Chief Financial Officer 
  

 - 30 - 

 Exhibit A 
  
 Interpretation A.65 from the Securities and Exchange Commission, Division of Corporation Finance, Manual of Publicly Available Telephone
Interpretations dated July 1997: 
  
 “An issuer filed a Form
S-3 registration statement for a secondary offering of common stock which is not yet effective. One of the selling shareholders wanted to do a short sale of common stock “against the box” and cover the short sale with registered shares
after the effective date. The issuer was advised that the short sale could not be made before the registration statement becomes effective, because the shares underlying the short sale are deemed to be sold at the time such sale is made. There
would, therefore, be a violation of Section 5 if the shares were effectively sold prior to the effective date.” 
  

 - 31 -

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