Document:

Exhibit 10.8 to Electromed, Inc. Form S1

Exhibit 10.8

THIS INSTRUMENT WAS PREPARED BY,

AND WHEN RECORDED SHOULD BE

RETURNED TO:

Dorsey & Whitney LLP
(CHMH)

Suite 1500

50 South Sixth Street

Minneapolis, Minnesota 55402-1498

MORTGAGE, SECURITY AGREEMENT,

ASSIGNMENT OF LEASES AND RENTS

AND FIXTURE FINANCING STATEMENT

NOTWITHSTANDING ANYTHING TO
THE CONTRARY HEREIN, ENFORCEMENT OF THIS MORTGAGE IS LIMITED TO A DEBT AMOUNT
OF $1,520,000 UNDER CHAPTER 287 OF MINNESOTA STATUTES.

          This
MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF LEASES AND RENTS AND FIXTURE FINANCING
STATEMENT (this “Mortgage,” which term shall include any amendment,
modification, supplement, extension, renewal, replacement, or restatement
hereof) is made as of December 9, 2009, by Electromed, Inc., a Minnesota
corporation (“Mortgagor”), having its principal offices at 500 6th Avenue NW,
New Prague, Minnesota 56071, in favor of U.S. Bank National Association, a
national banking association (“Lender”), having its principal offices at
Minneapolis, Minnesota.

RECITALS

          A.   
Lender has made loans, or agreed to make loans, to Mortgagor in the aggregate
maximum principal amount of Six Million Twenty Thousand and No/100 Dollars
($6,020,000.00) and made and other credit extensions to Mortgagor
(collectively, the “Loan”), to be repaid with interest thereon, pursuant to
that certain Credit Agreement of even date herewith (the “Credit Agreement,”
which term shall include any amendment, modification, supplement, extension,
renewal, replacement, or restatement thereof), and certain notes described therein
(collectively, the “Notes,” which term shall include any amendment,
modification, supplement, extension, renewal, replacement, or restatement
thereof). The Notes, the Credit Agreement and any other Loan Document (as
defined in the Credit Agreement) are each dated the same date as this Mortgage,
are hereby incorporated by reference, and, together with this Mortgage, as any
of the same may be amended, modified, supplemented, extended, renewed, replaced
or restated, are

sometimes collectively
referred to as the “Loan Documents.” Capitalized terms used in this Mortgage
have the meanings set forth herein; capitalized terms used in this Mortgage but
not defined herein have the meanings assigned to such terms in the Credit
Agreement.

          B.          This
Mortgage secures the following (collectively, as used herein, the
“Obligations”): (i) the Obligations, as defined in the Credit Agreement, which
include, without limitation, the principal amount of $6,020,000.00 or so much
thereof as may be advanced by Lender pursuant to the Notes or the Credit
Agreement; plus interest on the amount advanced and unrepaid, at the interest
rate or rates provided in the Notes or the Credit Agreement; and (ii) all other
amounts payable by Mortgagor and all other agreements of Mortgagor under this
Mortgage and the other the Loan Documents as the same now exist or may
hereafter be amended.

          C.          The
Obligations shall mature on or before December 9, 2014 (the “Maturity Date”).

          D.          Notwithstanding
any provision herein to the contrary, the maximum principal indebtedness
secured hereby is $1,520,000.00 plus amounts which may be advanced by Lender in
protection of the Mortgaged Property or this Mortgage. This Mortgage secures
only a portion of the Obligations owing or which may become owing by Mortgagor
to Lender. In the event that the amount secured by this Mortgage is less than the Obligations, then all
amounts paid upon the Obligations shall be first applied to the Obligations not
secured hereby, and the amount secured hereby shall be reduced only by the last
and final sums that Mortgagor repays with respect to the Obligations after the
amount of the Obligations is reduced to an amount equal to or less than the
amount secured hereby, and shall not be reduced by any intervening repayments
of the Obligations unless arising from the Mortgaged Property, it being the
parties’ intent that the portion of the Obligations last remaining unpaid shall
be secured hereby. So long as the balance of the Obligations exceeds the amount
secured hereby, any payments of the Obligations shall not be deemed to be
applied against, or to reduce, the portion of the Obligations secured by this
Mortgage unless owing from the Mortgaged Property. Such payments shall instead
be deemed to reduce only such portions of the Obligations as are secured by
other non-real estate collateral
or by real estate collateral located outside the State of Minnesota or as are
unsecured.

          NOW,
THEREFORE, Mortgagor, in consideration of Lender making the Loan, and to secure
the Loan and payment and performance of the Obligations, hereby grants,
bargains, sells, conveys and mortgages to Lender, its successors and assigns,
forever, with power of sale, and grants to Lender, its successors and assigns,
a security interest in, the following, all of which is called the “Mortgaged
Property”:

A. LAND AND IMPROVEMENTS

          The
land described in Exhibit A attached hereto and all mineral rights,
hereditaments, easements and appurtenances thereto (collectively the “Land”),
and all improvements and structures thereon (the “Improvements”); and

2

B. FIXTURES AND PERSONAL PROPERTY

          All
fixtures (the “Fixtures”), and all machinery, equipment and personal property
(collectively the “Personal Property”) now or hereafter located on, in or under
the Land and the Improvements, or usable in connection with the Land or the
Improvements, and which are owned by Mortgagor or in which Mortgagor has an
interest, including any construction and building materials stored on and to be
included in the Improvements, plus any repairs, replacements and betterments to
any of the foregoing and the proceeds and products thereof; and

C. LEASES AND RENTS

          All
rights of Mortgagor with respect to tenants or occupants now or hereafter
occupying any part of the Land or the Improvements, if any, including all
leases and licenses and rights in connection therewith, whether oral or written
(collectively the “Leases”), and all rents, income, both from services and
occupation, royalties, revenues and payments, including prepayments and
security deposits (collectively the “Rents”), which are now or hereafter due or
to be paid in connection with the Land, the Improvements, the Fixtures or the
Personal Property; and

D. GENERAL INTANGIBLES

          All
general intangibles of Mortgagor which relate to any of the Land, the
Improvements, the Fixtures, the Personal Property, the Leases or the Rents,
including proceeds of insurance and condemnation or conveyance of the Land and
the Improvements, accounts, trade names, contract rights, accounts receivable
and bank accounts; and

E. AFTER ACQUIRED PROPERTY AND PROCEEDS

          All
after acquired property similar to the property herein described and conveyed
which may be subsequently acquired by Mortgagor and used in connection with the
Land, the Improvements, the Fixtures, the Personal Property and other property;
and all cash and non-cash proceeds and products of all of the foregoing
property.

          TO
HAVE AND TO HOLD the same, and all estate therein, together with all the
rights, privileges and appurtenances thereunto belonging, to the use and
benefit of Lender, its successors and assigns, forever.

          PROVIDED
NEVERTHELESS, should Mortgagor pay and perform all the Obligations, then these
presents will be of no further force and effect, and this Mortgage shall be
satisfied by Lender, at the expense of Mortgagor.

          This
Mortgage constitutes an assignment of rents and profits within the meaning of
Minnesota Statutes, Sections 559.17 and 576.01, and is intended to comply fully
with the provisions thereof, and to afford Lender, to the fullest extent
allowed by law, the rights and remedies of a mortgage lender or secured lender
pursuant thereto.

          This
Mortgage also constitutes a security agreement within the meaning of the
Uniform Commercial Code as in effect in the State of Minnesota (the “UCC”),
with respect to all property described herein as to which a security interest
may be granted and/or perfected pursuant to the

3

UCC, and is intended to
afford Lender, to the fullest extent allowed by law, the rights and remedies of
a secured party under the UCC.

          MORTGAGOR
FURTHER agrees as follows:

ARTICLE I 

AGREEMENTS

          Section
1.1     Performance of Obligations; Incorporation by
Reference. Mortgagor shall pay and perform the Obligations owing by it or him.
Time is of the essence hereof. All of the covenants, obligations, agreements,
warranties and representations of Mortgagor contained in the Credit Agreement and
the other Loan Documents and all of the terms and provisions thereof, are
hereby incorporated herein and made a part hereof by reference as if fully set
forth herein.

          Section
1.2     Further Assurances. If Lender requests,
Mortgagor shall sign and deliver and cause to be recorded as Lender shall
direct any further mortgages, instruments of further assurance, certificates
and other documents as Lender reasonably may consider necessary or desirable in
order to perfect, continue and preserve the Obligations and Lender’s rights,
title, estate, liens and interests under the Loan Documents. Further, the
Mortgagor shall pay all reasonable out-of-pocket expenses incurred by the
Lender, including title insurance costs and the reasonable fees, charges and disbursements
of outside counsel for the Lender (determined on the basis of such counsel’s
generally applicable rates, which may be higher than the rates such counsel
charges the Lender in certain matters) and/or the allocated costs of in-house
counsel incurred from time to time, in connection with the preparation,
execution, recording, filing and refiling of any such documents.

          Section
1.3     Sale, Transfer, Encumbrance. An immediate
default and Event of Default shall occur hereunder if Mortgagor sells, conveys,
transfers or otherwise disposes of, or encumbers, any part of its interest in
the Mortgaged Property, whether voluntarily, involuntarily or by operation of
law, without the prior written consent of Lender, and Lender shall have the
option to declare the Obligations immediately due and payable without notice.
Included within the foregoing actions requiring prior written consent of Lender
are: (a) sale by deed or contract for deed; (b) mortgaging or granting a lien
on the Mortgaged Property; and (c) a Change of Control Occurs. Mortgagor shall
give notice of any proposed action to Lender at least thirty (30) days prior to
taking such action. Mortgagor shall pay all costs and expenses incurred by
Lender in evaluating any such action. Lender may condition such consent upon
modification of the Loan Documents or payment of fees. No such action shall
relieve Mortgagor from liability for the Obligations. The consent by Lender to
any action shall not constitute a waiver of the necessity of such consent to
any subsequent action.

          Section
1.4     Insurance. Mortgagor shall obtain, maintain
and keep in full force and effect (and upon request of Lender shall furnish to
Lender copies of) policies of insurance as described in, and meeting the
requirements set forth in the Credit Agreement.

          Section
1.5     Taxes, Liens and Claims, Utilities. Mortgagor,
at least five (5) days before any penalty attaches thereto, shall pay and
discharge, or cause to be paid and discharged, all taxes, assessments and
governmental charges and levies (collectively “Impositions”) imposed

4

upon or against the
Mortgaged Property or the Rents, or upon or against the Obligations, or upon or
against the interest of Lender in the Mortgaged Property or the Obligations, except
Impositions measured by the income of Lender. Mortgagor shall provide evidence
of such payment at Lender’s request. Mortgagor shall keep the Mortgaged
Property free and clear of all liens, encumbrances, easements, covenants,
conditions, restrictions and reservations (collectively “Liens”) except those
listed on Exhibit A attached hereto (the “Permitted Encumbrances”). Mortgagor
shall pay or cause to be paid when due all charges or fees for utilities and
services supplied to the Mortgaged Property. Notwithstanding anything to the
contrary contained in this Section, Mortgagor shall not be required to pay or
discharge any Imposition or Lien so long as Mortgagor shall in good faith, and
after giving notice to Lender, contest the same by appropriate legal proceedings.
If Mortgagor contests any Imposition or Lien against the Mortgaged Property,
Mortgagor shall provide such security to Lender as Lender shall reasonably
require against loss or impairment of Mortgagor’s ownership of or Lender’s lien
on the Mortgaged Property and shall in any event pay such Imposition or Lien
before loss or impairment occurs.

          Section
1.6     Escrow Payments. If requested by Lender,
Mortgagor shall deposit with Lender monthly on the same date as payments are
due under the Notes and the Credit Agreement the amount reasonably estimated by
Lender to be necessary to enable Lender to pay, at least five (5) days before
they become due, all Impositions against the Mortgaged Property and the
premiums upon all insurance required hereby to be maintained with respect to
the Mortgaged Property. All funds so deposited shall secure the Obligations.
Such deposits shall be held by Lender, or its nominee, in a non-interest
bearing account and may be commingled with other funds. Such deposits shall be
used to pay such Impositions and insurance premiums when due. Any excess sums
so deposited shall be retained by Lender and shall be applied to pay said items
in the future, unless the Obligations have been paid and performed in full, in
which case all excess sums so paid shall be refunded to Mortgagor. Upon the
occurrence of an Event of Default, Lender may apply any funds in said account
against the Obligations in such order as Lender may determine.

          Section
1.7     Maintenance and Repair; Compliance with Laws.
Mortgagor shall cause the Mortgaged Property to be operated, maintained and
repaired in safe and good repair, working order and condition, reasonable wear
and tear excepted; shall not commit or permit waste thereof; except as provided
in any Loan Document, shall not remove, demolish or substantially alter the
design or structural character of any Improvements without the prior written
consent of Lender; shall complete or cause to be completed forthwith any
Improvements which are now or may hereafter be under construction upon the
Land; shall comply or cause compliance with all laws, statutes, ordinances and
codes, and governmental rules, regulations and requirements, applicable to the
Mortgaged Property or the manner of using or operating the same, and with any
covenants, conditions, restrictions and reservations affecting the title to the
Mortgaged Property, and with the terms of all insurance policies relating to
the Mortgaged Property; and shall obtain and maintain in full force and effect
all consents, permits and licenses necessary for the use and operation of the
Mortgaged Property.

          Section
1.8     Leases.

          (a)          Mortgagor
shall not enter into or amend any Lease without Lender’s prior written consent,
and shall furnish to Lender, upon execution, a complete and fully executed copy
of each

5

Lease. Mortgagor shall
provide Lender with a copy of each proposed Lease requiring the consent of
Lender and with any information requested by Lender regarding the proposed
Tenant thereunder. Lender may declare each Lease to be prior or subordinate to
this Mortgage, at Lender’s option.

          (b)          Mortgagor
shall, at its cost and expense, perform each obligation to be performed by it
under each Lease; not borrow against, pledge or further assign any rents or
other payments due thereunder; not permit the prepayment of any rents or other
payments due for more than thirty (30) days in advance; and not permit any
Tenant to assign its Lease or sublet the premises covered by its Lease.

          (c)          If
any Tenant shall default under its Lease, Mortgagor shall, in the ordinary
course of business, exercise sound business judgment with respect to such
default, but Mortgagor may not discount, compromise, forgive or waive claims or
discharge the Tenant from its obligations under the Lease or terminate or
accept a surrender of the Lease without Lender’s written consent.

          (d)          If
Mortgagor fails to perform any obligations of Mortgagor under any Lease or if
Lender becomes aware of or is notified by any Tenant of a failure on the part
of Mortgagor to so perform, Lender may, but shall not be obligated to, without
waiving or releasing Mortgagor from any obligation in this Mortgage or any of
the other Loan Documents, remedy such failure, and Mortgagor agrees to repay
upon demand all sums incurred by Lender in remedying any such failure, together
with interest thereon from the date incurred at the default rate specified in
the Credit Agreement.

          (e)          For
purposes of this Mortgage, the following terms shall have the following meanings:

	
  

 	
  

 	
  

 
	
  

 	
 (i)

 	
“Lease”: Any lease
or other document or agreement, written or oral, permitting any Person to use
or occupy any part of the Mortgaged Property.

 
	
  

 
	
  

 	
 (ii)

 	
“Person”:
Any natural person, corporation, partnership, limited partnership, joint
venture, firm, association, trust, unincorporated organization, government or
governmental agency or political subdivision or any other entity, whether
acting in an individual, fiduciary or other capacity.

 
	
  

 
	
  

 	
 (iii)

 	
“Tenant”:
Any person or party using or occupying any part of the Mortgaged Property
pursuant to a Lease.

 

          Section
1.9     Indemnity. Mortgagor shall indemnify Lender
and its directors, officers, agents and employees (collectively the
“Indemnified Parties”) against, and hold the Indemnified Parties harmless from,
all losses, damages, suits, claims, judgments, penalties, fines, liabilities,
costs and expenses by reason of, or on account of, or in connection with the
construction, reconstruction or alteration of the Mortgaged Property, or any
accident, injury, death or damage to any person or property occurring in, on or
about the Mortgaged Property or any street, drive, sidewalk, curb or passageway
adjacent thereto. The indemnity contained in this Section shall include costs
of defense of any such claim asserted against an Indemnified Party, including
attorneys’ fees. The indemnity contained in this Section shall survive payment
and performance

6

of the Obligations and
satisfaction and release of this Mortgage and any foreclosure thereof or
acquisition of title by deed in lieu of foreclosure.

          Section
1.10     Appraisals. Lender shall have the right from time
to time, but not more often than once during any twelve (12)-month period, to
obtain an appraisal of the Mortgaged Property in form and substance
satisfactory to Lender and prepared by an independent MAI appraiser selected by
Lender. Mortgagor shall reimburse Lender for the cost incurred for any such
appraisal within ten (10) days following demand therefor by Lender.

ARTICLE II
 REPRESENTATIONS AND WARRANTIES

          Mortgagor
makes the following representations and warranties:

          Section
2.1     Ownership, Liens, Compliance with Laws.
Mortgagor owns the Mortgaged Property in fee, free from all Liens, except the
Permitted Encumbrances. All applicable zoning, environmental, land use,
subdivision, building, fire, safety and health laws, statutes, ordinances,
codes, rules, regulations and requirements affecting the Mortgaged Property
permit the current use and occupancy thereof, and Mortgagor has obtained all
consents, permits and licenses required for such use. Mortgagor has examined
and is familiar with all applicable covenants, conditions, restrictions and
reservations, and with all applicable laws, statutes, ordinances, codes and
governmental rules, regulations and requirements affecting the Mortgaged
Property, and the Mortgaged Property complies with all of the foregoing.

          Section
2.2     Use. The Mortgaged Property is not homestead
property nor is it agricultural property or in agricultural use.

          Section
2.3     Utilities; Services. The Mortgaged Property is
serviced by all necessary public utilities, and all such utilities are
operational and have sufficient capacity. There is no contract or agreement
providing for services to or maintenance of the Mortgaged Property which cannot
be canceled upon 30 days’ or less notice.

ARTICLE III

CASUALTY; CONDEMNATION

          Section
3.1     Casualty, Repair, Proof of Loss. If any
portion of the Mortgaged Property shall be damaged or destroyed by any cause (a
“Casualty”), Mortgagor shall:

          (a)          give
immediate notice to the Lender; and

          (b)          promptly
commence and diligently pursue to completion (in accordance with plans and
specifications approved by Lender) the restoration, repair and rebuilding of
the Mortgaged Property as nearly as possible to its value, condition and
character immediately prior to the Casualty; and

          (c)          if
the Casualty is covered by insurance, immediately make proof of loss and collect
all insurance proceeds, all such proceeds to be payable to Lender or as Lender
shall direct. If an Event of Default shall be in existence, or if Mortgagor
shall fail to provide notice to

7

Lender of filing proof of loss, or if Mortgagor shall
not be diligently proceeding, in Lender’s reasonable
opinion, to collect such insurance proceeds, then Lender may, but is not
obligated to, make proof of loss, and is authorized, but is not
obligated, to settle any claim with respect thereto, and to collect the
proceeds thereof. Mortgagor shall not accept any settlement of an insurance
claim, the result of which shall be a payment which is $10,000 or more less
than the full amount of the claim, without
the prior written consent of Lender.

          Section
3.2     Use of Insurance Proceeds. Lender shall make
the net insurance proceeds received by it (after reimbursement of Lender’s
out-of pocket costs of collecting and disbursing the same) available to
Mortgagor to pay the cost of restoration, repair and rebuilding of the Mortgaged Property, subject to the following
conditions:

          (a)     There shall be no Event of Default in existence
at the time of any disbursement of the insurance proceeds.

          (b)     Lender
shall have determined, in its reasonable discretion, that the cost of restoration, repair and rebuilding is and will be
equal to or less than the amount of insurance proceeds and other funds
deposited by Mortgagor with Lender.

          (c)     Lender
shall have determined, in its reasonable discretion, that the restoration, repair and rebuilding can be completed in
accordance with plans and specifications approved by Lender (such
approval not to be unreasonably withheld), in accordance with codes and
ordinances, and in accordance with the terms, and within the time requirements
in order to prevent termination, of any Lease, and in any event not less than
six (6) months prior to the Maturity Date.

          (d)     All
funds shall be disbursed, at Lender’s option, in accordance with Lender’s customary disbursement procedures for
construction loans.

          (e)     The Casualty shall have occurred more than twelve
(12) months prior to the Maturity
Date.

          (f)     No Tenant shall have the right to terminate its
Lease or their Leases as a result of the
Casualty.

If any of these conditions shall not be satisfied,
then Lender shall have the right to use the insurance proceeds to prepay the
Loan in accordance with the Credit Agreement. If any insurance proceeds shall remain after completion of the restoration,
repair and rebuilding of the Mortgaged Property, they shall be disbursed to
Mortgagor, or at the Lender’s discretion, used to prepay the Loan in accordance
with the Credit Agreement.

          Section
3.3     Condemnation. If any portion of the Mortgaged
Property shall be taken, condemned or acquired pursuant to exercise of the
power of eminent domain or threat thereof (a “Condemnation”), Mortgagor
shall:

          (a)     give
immediate notice thereof to Lender, and send a copy of each document received by Mortgagor in connection with the
Condemnation to Lender promptly after receipt; and

8

          (b)     diligently
pursue any negotiation and prosecute any proceeding in connection with the Condemnation at Mortgagor’s expense. If
an Event of Default shall be in existence, or if Mortgagor, in Lender’s
reasonable opinion, shall not be diligently negotiating or prosecuting the claim, Lender is authorized, but not
required, to negotiate and prosecute the claim and appear at any hearing
for itself and on behalf of Mortgagor and to compromise or settle all
compensation for the Condemnation. Lender shall not be liable to Mortgagor for
any failure by Lender to collect or to exercise diligence in collecting any
such compensation. Mortgagor shall not compromise or settle any claim resulting
from the Condemnation if such settlement shall result in payment of $10,000 or
more less than Lender’s reasonable estimate of the damages therefrom. All awards shall be paid to Lender.

          Section
3.4     Use of Condemnation Proceeds. Lender shall
make the net proceeds of any Condemnation received by it (after
reimbursement of Lender’s out-of-pocket costs of collecting and disbursing the same) available to Mortgagor for
restoration, repair and rebuilding of the Mortgaged Property, subject to the
following conditions:

          (a)     There shall be no Event of Default in existence
at the time of any disbursement of the condemnation proceeds.

          (b)     Lender
shall have determined, in its reasonable discretion, that the cost of restoration, repair and rebuilding is and will be
equal to or less than the amount of condemnation proceeds and other funds
deposited by Mortgagor with Lender.

          (c)     Lender
shall have determined, in its reasonable discretion, that the restoration, repair and rebuilding can be completed in
accordance with plans and specifications approved by Lender (such
approval not to be unreasonably withheld), in accordance with codes and
ordinances, and in accordance with the terms, and within the time requirements
in order to prevent termination, of any Lease, and in any event not less than
six (6) months prior to the Maturity Date.

          (d)     All
funds shall be disbursed, at Lender’s option, in accordance with Lender’s customary disbursement procedures for
construction loans.

          (e)     The Condemnation shall have occurred more than
twelve (12) months prior to the Maturity
Date.

          (f)     No Tenant shall have the right to terminate its
Lease or their Leases as a result of the Condemnation.

If any of these conditions shall not be satisfied,
then Lender shall have the right to use the condemnation proceeds to prepay the
Loan in accordance with the Credit Agreement. If any condemnation proceeds shall remain after completion of the restoration,
repair and rebuilding of the Mortgaged Property, they shall be disbursed to
Mortgagor, or at Lender’s discretion, used to prepay the Loan in accordance
with the Credit Agreement.

9

ARTICLE IV

DEFAULTS AND REMEDIES

          Section
4.1     Events of Default. The occurrence of any one
or more of the following events shall constitute an Event of Default hereunder:

          (a)     An
Event of Default, as defined in the Credit Agreement; or

          (b)     Mortgagor fails to comply with any agreement,
covenant, condition, provision or term contained in this Mortgage.

          Section
4.2     (b)     Remedies.
Upon the occurrence of certain Event of Default, as described more fully
in the Credit Agreement, all of the Obligations shall be accelerated and become
immediately due and payable without notice or declaration to Mortgagor. Upon
the occurrence of one or more other Events of Default, as described more fully
in the Credit Agreement, all of the Obligations, at the option of Lender, shall
be accelerated and become immediately due
and payable upon notice to Mortgagor. In either event, the Obligations shall be
due and payable without presentment, demand or further notice of any
kind. Lender shall have the right to proceed to protect and enforce its rights
by one or more of the following remedies:

          (a)     LENDER SHALL HAVE THE RIGHT TO BRING SUIT either
for damages, for specific performance of any agreement contained in any
Loan Document, for the foreclosure of this Mortgage, or for the enforcement of
any other appropriate legal or equitable remedy.

          (b)     LENDER SHALL HAVE THE RIGHT TO SELL THE MORTGAGED PROPERTY AT PUBLIC AUCTION AND CONVEY THE SAME TO
THE PURCHASER IN FEE SIMPLE, as
provided by law, Mortgagor to remain liable for any deficiency. Said sale may be as one tract or otherwise, at the sole option
of Lender. In the event of any sale of the Mortgaged Property pursuant
to any judgment or decree of any court or at public auction or otherwise in
connection with the enforcement of any of the terms of this Mortgage, Lender,
its successors or assigns, may become the purchaser, and for the purpose of
making settlement for or payment of the purchase price, shall be entitled to
deliver over and use the Credit Agreement or Notes and any claims for interest
accrued and unpaid thereon, together with all other sums, with interest,
advanced or secured hereby and unpaid hereunder, in order that there may be
credited as paid on the purchase price the total amount of the Obligations then
due, including principal and interest on the Loan and all other sums, with
interest, advanced or secured hereby and
unpaid hereunder or under any of the other Loan Documents.

          (c)     LENDER SHALL HAVE THE RIGHT TO OBTAIN THE
APPOINTMENT OF A RECEIVER at any
time after the occurrence of an Event of Default. Lender may apply for the appointment
of a receiver to the district court for the county where the Mortgaged Property
or any part thereof is located, by an
action separate from any foreclosure of this Mortgage pursuant to Minnesota
Statutes Chapter 580 or pursuant to Minnesota Statutes Chapter 581, or as a
part of the foreclosure action under said Chapter 581 (it being agreed that the
existence of a foreclosure pursuant to said Chapter 580 or a foreclosure
action pursuant to said Chapter 581 is not a prerequisite
to any action for a receiver hereunder). Lender shall be entitled to the
appointment of a receiver without regard to waste, adequacy of the
security or solvency of Mortgagor. The

10

receiver, who shall be an experienced property
manager, shall collect (until the Obligations are fully paid and satisfied and, in the case of a foreclosure sale, during
the entire redemption period) the Rents, and shall manage the Mortgaged
Property, execute Leases within or beyond the period of the receivership
if approved by the court and apply all rents, profits and other income collected by him in the following order:

	
  

 	
  

 	
  

 
	
  

 	
 (i)

 	
 to the payment of all
 reasonable fees of the receiver, if any, approved by the court;

 
	
  

 	
  

 	
  

 
	
  

 	
 (ii)

 	
 to the repayment of tenant
 security deposits, with interest thereon, as required by Minnesota Statutes,
 Section 504B.178;

 
	
  

 	
  

 	
  

 
	
  

 	
 (iii)

 	
 to the payment when due of
 delinquent or current real estate taxes or special assessments with respect to the Mortgaged
 Property, or the periodic escrow for the payment of the same;

 
	
  

 	
  

 	
  

 
	
  

 	
 (iv)

 	
 to the payment when due of
 premiums for insurance of the type required by this Mortgage, or the periodic
 escrow for the payment of the same;

 
	
  

 	
  

 	
  

 
	
  

 	
 (v)

 	
 to the payment for the keeping
 of the covenants required of a lessor or licensor pursuant to
 Minnesota Statutes, Section 504B.161, subdivision 1;

 
	
  

 	
  

 	
  

 
	
  

 	
 (vi)

 	
 to the payment of all expenses
 for normal maintenance of the Mortgaged Property; and

 
	
  

 	
  

 	
  

 
	
  

 	
 (vii)

 	
 the balance to Lender (a) if
 received prior to the commencement of a foreclosure, to be applied to
 the Obligations, in such order as Lender may elect and (b) if received after
 the commencement of a foreclosure, to be applied to the amount required to be
 paid to effect a reinstatement prior to foreclosure sale, or, after a foreclosure sale to any deficiency and
 thereafter to the amount required to be paid to effect a redemption,
 all pursuant to Minnesota Statutes, Sections 580.30, 580.23 and 581.10, with any excess to be paid to Mortgagor. Provided,
 that if this Mortgage is not reinstated nor the Mortgaged Property
 redeemed as provided by said Sections
 580.30, 580.23 or 581.10, the entire amount paid to Lender pursuant hereto
 shall be the property of Lender together with all or any part of the Mortgaged Property acquired through
 foreclosure.

 

          Lender
shall have the right, at any time and without limitation, as provided in
Minnesota Statutes, Section 582.03, to advance money to the receiver to
pay any part or all of the items which the
receiver should otherwise pay if cash were available from the Mortgaged
Property and sums so advanced, with interest at the default rate
specified in the Credit Agreement, shall be secured
hereby, or if advanced during the period of redemption shall be part of the sum
required to be paid to redeem from the sale.

          (d)     LENDER
SHALL HAVE THE RIGHT TO COLLECT THE RENTS from the Mortgaged Property
and apply the same in the manner hereinbefore provided with respect to a receiver. For that purpose, Lender may enter and
take possession of the Mortgaged Property and manage and operate the
same and take any action which, in Lender’s judgment, is necessary or

11

proper to collect the Rents and to conserve the value
of the Mortgaged Property. Lender may also take possession of, and for these
purposes use, any and all of the Personal Property. The expense (including any
receiver’s fees, attorneys’ fees, costs and agent’s compensation) incurred
pursuant to the powers herein contained shall be secured by this Mortgage.
Lender shall not be liable to account to
Mortgagor for any action taken pursuant hereto other than to account for any Rents
actually received by Lender. Enforcement hereof shall not cause Lender to be
deemed a mortgagee in possession unless
Lender elects in writing to be a mortgagee in possession.

          (e)     LENDER SHALL HAVE THE RIGHT TO ENTER AND TAKE
POSSESSION of the Mortgaged Property
and manage and operate the same in conformity with all applicable laws
and take any action which, in Lender’s judgment, is necessary or proper to
conserve the value of the Mortgaged
Property.

          (f)     LENDER SHALL HAVE ALL OF THE RIGHTS AND REMEDIES PROVIDED IN THE UNIFORM COMMERCIAL CODE including
the right to proceed under the Uniform Commercial Code provisions governing
default as to any Personal Property separately from the real estate included
within the Mortgaged Property, or to proceed as to all of the Mortgaged
Property in accordance with its rights and remedies in respect of said real
estate. If Lender should elect to proceed separately as to such Personal
Property, Mortgagor agrees to make such
Personal Property available to Lender at a place or places acceptable to
Lender, and if any notification of intended disposition of any of such Personal
Property is required by law, such notification shall be deemed
reasonably and properly given if given at least ten (10) days before such disposition in the manner hereinafter
provided.

          (g)     LENDER SHALL HAVE THE RIGHT TO FILE PROOF OF
CLAIM and other documents as may be necessary or advisable in order to
have its claims allowed in any receivership, insolvency, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial proceedings affecting Mortgagor, its creditors or its
property, for the entire amount due and payable by Mortgagor in respect
of the Obligations at the date of the institution of such proceedings, and for any additional amounts which
may become due and payable by Mortgagor after such date.

Each remedy herein specifically given shall be in
addition to every other right now or hereafter given or existing at law or in
equity, and each and every right may be exercised from time to time and as
often and in such order as may be deemed expedient by Lender and the exercise
or the beginning of the exercise of one
right shall not be deemed a waiver of the right to exercise at the same
time or thereafter any other right. Lender shall have all rights and remedies
available under the law in effect now and/or at the time such rights and
remedies are sought to be enforced, whether or not they are available under the
law in effect on the date hereof.

          Section
4.3     Expenses of Exercising Rights Powers and
Remedies. The reasonable expenses
(including any receiver’s fees, attorneys’ fees, appraisers’ fees,
environmental engineers’ and/or consultants’ fees, costs incurred for
documentary and expert evidence, stenographers’ charges, publication costs,
costs (which may be estimated as to items to be expended after entry of the decree of foreclosure) of procuring all
abstracts of title, continuations of abstracts of title, title searches
and examinations, title insurance policies and commitments and extensions
therefor, UCC and chattel lien searches, and similar data and assurances with

12

respect to title as Lender may deem reasonably
necessary either to prosecute any foreclosure action
or to evidence to bidders at any sale which may be had pursuant to any
foreclosure decree the true condition of the title to or the value of
the Mortgaged Property, and agent’s compensation) incurred by Lender after the
occurrence of any Event of Default and/or in pursuing the rights, powers and
remedies contained in this Mortgage shall be immediately due and payable by
Mortgagor, with interest thereon from the date incurred at the default rate
specified in the Credit Agreement, and shall be added to the indebtedness
secured by this Mortgage.

          Section
4.4     Restoration of Position. In case Lender shall
have proceeded to enforce any right under this Mortgage by foreclosure,
sale, entry or otherwise, and such proceedings shall have been discontinued or
abandoned for any reason or shall have been determined adversely, then, and in every such case, Mortgagor and Lender shall be
restored to their former positions and rights hereunder with respect to the
Mortgaged Property subject to the lien hereof.

          Section
4.5     Marshalling. Mortgagor, for itself and on
behalf of all Persons which may claim under Mortgagor, hereby waives all
requirements of law relating to the marshalling of assets, if any, which would
be applicable in connection with the enforcement by Lender of its remedies for
an Event of Default hereunder, absent this waiver. Lender shall not be required
to sell or realize upon any portion of the Mortgaged Property before selling or
realizing upon any other portion thereof.

          Section
4.6     Waivers. No waiver of any provision hereof
shall be implied from the conduct of the parties. Any such waiver must be in
writing and must be signed by the party against which such waiver is sought to
be enforced. The waiver or release of any breach of the provisions set forth herein
to be kept and performed shall not be a waiver or release of any preceding or
subsequent breach of the same or any other provision. No receipt of partial
payment after acceleration of any of the Obligations shall waive the
acceleration. No payment by Mortgagor or receipt by Lender of a lesser amount
than the full amount secured hereby shall be deemed to be other than on account
of the sums due and payable hereunder, nor shall any endorsement or statement
on any check or any letter accompanying any check or payment be deemed an
accord and satisfaction, and Lender may accept any check or payment without
prejudice to Lender’s right to recover the balance of such sums or to pursue
any other remedy provided in this Mortgage.
The consent by Lender to any matter or event requiring such consent shall not
constitute a waiver of the necessity for such consent to any subsequent matter
or event.

          Section
4.7     Lender’s Right to Cure Defaults. If Mortgagor
shall fail to comply with any of the terms of the Loan Documents with
respect to the procuring of insurance, the payment of taxes, assessments and
other charges, the keeping of the Mortgaged Property in repair, or any other
term contained herein or in any of the other Loan Documents, Lender may make
advances to perform the same without
releasing Mortgagor from any of the Obligations. Mortgagor agrees to repay upon
demand all sums so advanced and all sums expended by Lender in connection with such
performance, including without limitation attorneys’ fees, with interest at the
default rate specified in the Credit
Agreement from the dates such advances are made, and all sums so advanced
and/or expenses incurred, with interest, shall be secured hereby, but no such
advance and/or incurring of expense by Lender, shall be deemed to relieve
Mortgagor from any default

13

hereunder or under any of the
other Loan Documents, or to release Mortgagor from any of the Obligations.

          Section
4.8     Suits and Proceedings. Lender shall have the
power and authority, upon prior notice to Mortgagor, to institute and maintain
any suits and proceedings as Lender may deem advisable to (i) prevent any
impairment of the Mortgaged Property by any act which may be unlawful or by any
violation of this Mortgage, (ii) preserve or protect its interest in the
Mortgaged Property, or (iii) restrain the enforcement of or compliance with any
legislation or other governmental
enactment, rule or order that may be unconstitutional or otherwise invalid, if,
in the sole opinion of Lender, the enforcement of or compliance with
such enactment, rule or order might impair the security hereunder or be
prejudicial to Lender’s interest.

ARTICLE V

MISCELLANEOUS

          Section
5.1     Binding Effect; Survival; Number; Gender. This
Mortgage shall be binding on and inure to the benefit of the parties hereto,
and their respective heirs, legal representatives,
successors and assigns. All agreements, representations and warranties contained
herein or otherwise heretofore made by Mortgagor to Lender shall survive the
execution, delivery and foreclosure hereof. The singular of all terms used
herein shall include the plural, the plural
shall include the singular, and the use of any gender herein shall include all
other genders, where the context so requires or permits.

          Section
5.2     Severability. The unenforceability or
invalidity of any provision of this Mortgage as to any person or
circumstance shall not render that provision unenforceable or invalid as to any other person or circumstance.

          Section
5.3     Notices. Except when telephonic notice is
expressly authorized by this Mortgage, any notice or other communication to any
party in connection with this Mortgage shall
be in writing and shall be sent by manual delivery, facsimile transmission,
overnight courier or United States mail (postage prepaid) addressed to such
party at the address specified below, or at such other address as such party shall have specified to the other
party hereto in writing. All periods
of notice shall be measured from the date of delivery thereof if manually
delivered, from the date of sending thereof if sent by facsimile transmission,
from the first Banking Day after the date of sending if sent by overnight
courier, or from four days after the date of mailing if mailed. Notices
shall be given to or made upon the respective parties hereto at their
respective addresses set forth below:

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 If to Mortgagor:

 	
 Electromed, Inc.

 	
  

 
	
  

 	
  

 	
 500 6th Avenue NW

 	
  

 
	
  

 	
  

 	
 New Prague, MN 56071

 	
  

 
	
  

 	
  

 	
 Attn: Robert D. Hansen

 	
  

 
	
  

 	
  

 	
 Telecopy No. 952-758-1941

 	
  

 

14

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 If to Lender:

 	
 U.S. Bank National Association

 	
  

 
	
  

 	
  

 	
 800 Second Avenue South

 	
  

 
	
  

 	
  

 	
 Minneapolis, MN 55402

 	
  

 
	
  

 	
  

 	
 BC-MN-H03W

 	
  

 
	
  

 	
  

 	
 Attention: Daniel Miller

 	
  

 
	
  

 	
  

 	
 Telecopy No. 612-303-2252

 	
  

 

Either party may change its
address for notices by a notice given not less than five (5) Banking days
prior to the effective date of the change.

          Section
5.4     Governing Law and Construction. THE VALIDITY,
CONSTRUCTION AND ENFORCEABILITY OF
THIS MORTGAGE SHALL BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF MINNESOTA,
WITHOUT GIVING EFFECT TO CONFLICT OF LAWS PRINCIPLES THEREOF, BUT GIVING EFFECT
TO FEDERAL LAWS OF THE UNITED STATES
APPLICABLE TO NATIONAL BANKS. Whenever possible, each provision of this
Mortgage and the other Loan Documents and any other statement, instrument or transaction contemplated hereby or thereby or
relating hereto or thereto shall be interpreted in such manner as to be
effective and valid under such applicable law, but, if any provision of this
Mortgage, the other Loan Documents or any other statement, instrument or transaction
contemplated hereby or thereby or relating hereto or thereto shall be held to
be prohibited or invalid under such applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of
this Mortgage, the other Loan Documents or any other statement, instrument or
transaction contemplated hereby or thereby or relating hereto or thereto.

          Section
5.5     Consent to Jurisdiction. AT THE OPTION OF
LENDER, THIS MORTGAGE MAY BE ENFORCED IN ANY
FEDERAL COURT OR MINNESOTA STATE COURT
SITTING IN HENNEPIN COUNTY; AND MORTGAGOR CONSENTS TO THE JURISDICTION AND VENUE OF ANY SUCH COURT AND
WAIVES ANY ARGUMENT THAT VENUE IN
SUCH FORUMS IS NOT CONVENIENT. IN THE EVENT MORTGAGOR COMMENCES ANY ACTION IN ANOTHER JURISDICTION OR VENUE UNDER ANY TORT OR CONTRACT THEORY ARISING DIRECTLY
OR INDIRECTLY FROM THE RELATIONSHIP CREATED BY THIS MORTGAGE, LENDER AT ITS OPTION SHALL BE ENTITLED TO HAVE THE CASE
TRANSFERRED TO ONE OF THE JURISDICTIONS
AND VENUES ABOVE-DESCRIBED, OR IF SUCH TRANSFER CANNOT BE ACCOMPLISHED UNDER
APPLICABLE LAW, TO HAVE SUCH CASE DISMISSED WITHOUT PREJUDICE.

          Section
5.6     Waiver of Jury Trial. EACH OF MORTGAGOR AND
LENDER IRREVOCABLY WAIVES ANY AND ALL RIGHT
TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS MORTGAGE OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY.

15

          Section
5.7     Effect. This Mortgage is in addition and not
in substitution for any other guarantees,
covenants, obligations or other rights now or hereafter held by Lender from any
other person or entity in connection with the Obligations.

          Section
5.8     Assignability. Lender shall have the right to
assign this Mortgage, in whole or in part,
or sell participation interests herein, to any person obtaining an interest in
the Obligations.

          Section
5.9     Headings. Headings of the Sections of this
Mortgage are inserted for convenience only and shall not be deemed to
constitute a part hereof.

          Section
5.10     Fixture Filing. This instrument shall be
deemed to be a Fixture Filing within the meaning of the Minnesota Uniform
Commercial Code, and for such purpose, the following information is given:

	
  

 	
  

 	
  

 	
  

 
	
      a.

 	
 Name and address of Debtor:

 	
  

 	
 Electromed, Inc.

 500 6th Avenue NW

 New Prague, MN 56071

 Attention: Robert D. Hansen

  

 
	
  

 	
  

 	
  

 	
  

 
	
      b.

 	
 Type of Organization:

 	
  

 	
 Mortgagor is a corporation.

 
	
  

 	
  

 	
  

 	
  

 
	
      c.

 	
 Jurisdiction of
 Organization:

 	
  

 	
 Mortgagor is organized under the laws of Minnesota.

 
	
  

 	
  

 	
  

 	
  

 
	
      d.

 	
 Organizational ID No.:

 	
  

 	
 Mortgagor’s organizational ID
 is 7O-794.

 
	
  

 	
  

 	
  

 	
  

 
	
      e.

 	
 Name and Address of Secured Party:

 	
  

 	
 U.S. Bank National Association

 800 Second Avenue South

 Minneapolis, MN 55402

 
	
  

 	
  

 	
  

 	
  

 
	
      f.

 	
 Description of the
 types (or

 items) of property covered by

 this Financing Statement:

 	
  

 	
 See Pages 2 and 3 hereof.

 
	
  

 	
  

 	
  

 	
  

 
	
      g

 	
 Legal Description of Land to

 which the collateral is attached

 or upon which is or will be

 fixtures:

 	
  

 	
 See Exhibit A hereto.

 
	
  

 	
  

 	
  

 	
  

 

Some of the above-described collateral is or is to
become fixtures upon the above-described real estate,
which Mortgagor owns in fee, and this Financing Statement is to be filed in the
public real estate records. The above-stated address of Secured Party is the
address from which information concerning the security interest may be
obtained.

16

          Section
5.11     Revolving Credit. The maximum
principal indebtedness secured by this Mortgage is $1,520,000 (“Maximum
Principal Amount”), a portion of which, for the purposes of Minnesota Statutes § 287.05, subd. 3, and
Section 507.324, is and shall be a revolving line of credit under which
advances, payments and readvances may be made from time to time, in accordance
with the Loan Documents (subject always to the provisions of the Credit Agreement). The maximum amount of said line of
credit that may be secured by this Mortgage at any one time is the
Maximum Principal Amount. Mortgagor hereby agrees that, if the outstanding,
unpaid balance of the revolving line of credit under the Loan Documents is ever
reduced to zero, or if at any time no
property is subject to the lien and/or security interest of this Mortgage,
novation shall not be deemed to have occurred, and the lien and security
interest hereof shall be deemed to remain in full force and effect to secure
any future advances made under said revolving line of credit and against any
property thereafter added to the Mortgaged Property
by amendment hereof.

          Section
5.12     MRT. Mortgagor agrees to pay upon
demand, or upon demand to promptly
reimburse Mortgagee for the payment of, the amount of the mortgage registry tax
payable with respect to and upon the recording of this Mortgage, and of any
amendment or modification hereof in accordance with Minnesota Statutes, Chapter
287.

[The remainder of this page has been left blank intentionally.]

17

          IN
WITNESS WHEREOF, Mortgagor has executed this Mortgage as of the date first
written above.

	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 ELECTROMED, INC.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 By:

 	
 

 
	
  

 	
  

 	
 Name:

 	
 Robert D. Hansen

 
	
  

 	
  

 	
 Title:

 	
 Chief Executive Officer

 
	
  

 	
  

 	
  

 	
  

 
	
 STATE OF MINNESOTA

 	
 )

 	
  

 	
  

 
	
  

 	
 ) ss.

 	
  

 	
  

 
	
 COUNTY OF HENNEPIN

 	
 )

 	
  

 	
  

 

          The
foregoing instrument was acknowledged before me December 9, 2009, by Robert D. Hansen, the Chief Executive Officer of
Electromed, Inc., a Minnesota corporation, on behalf of the corporation.

	
  

 	
  

 
	
  

 	
 

 
	
  

 	
 Notary
 Public

 
	

 	
  

 

 [Signature
Page to Mortgage, Security Agreement, Assignment of Leases
and Rents
and Fixture Financing Statement]

EXHIBIT A

Legal Description

Lot 1, Block 1, New Prague
Business Park 9th Addition, Scott County, Minnesota.

Together with the benefit of the
easement for utility purposes dated April 30, 2008, filed May 5, 2008, as
Document No. A799662.

Together with the benefit of the easement for ingress
and egress dated August 29, 2008, filed November 3, 2009 as Document No.
A839579.Exhibit 10.9 to Electromed, Inc. Form S1

Exhibit 10.9

GUARANTY

          THIS
GUARANTY, dated as of December 9, 2009, is made and given by ELECTROMED
FINANCIAL, LLC, a limited liability company organized under the laws of the
State of Minnesota (the “Guarantor”), in favor of U.S. BANK NATIONAL
ASSOCIATION, a national banking association (the “Lender”).

RECITALS

          A.      Electromed,
Inc., a Minnesota corporation (the “Borrower”), and the Lender have entered
into a Credit Agreement dated as of December 9, 2009 (as the same may hereafter
be amended, restated, or otherwise modified from time to time, the “Credit
Agreement”) pursuant to which the Lender has agreed to extend to the Borrower
certain credit accommodations consisting of a revolving facility and two term
loan facilities.

          B.      It
is a condition precedent to the obligation of the Lender to extend credit
accommodations pursuant to the terms of the Credit Agreement that this Guaranty
be executed and delivered by the Guarantor.

          C.      The
Guarantor is the majority-owned subsidiary of the Borrower.

          D.      The
Guarantor expects to derive benefits from the extension of credit
accommodations to the Borrower by the Lender and find Guarantor it
advantageous, desirable and in its their best interests to execute and deliver
this Guaranty to the Lender.

          NOW,
THEREFORE, In consideration of the credit accommodations to be extended to the
Borrower and for other good and valuable consideration, the Guarantor hereby
covenants and agrees with the Lender as follows:

          Section
1.     Defined Terms. As used in this Guaranty,
the following terms shall have the meaning indicated:

	
  

 	
  

 
	
  

 	
           “Borrower”
 shall have the meaning indicated in Recital A. 

 
	
  

 	
  

 
	
  

 	
           “Credit
 Agreement” shall have the meaning indicated in Recital A. 

 
	
  

 	
  

 
	
  

 	
           “Guarantor”
 shall have the meaning indicated in the opening paragraph hereof. 

 
	
  

 	
  

 
	
  

 	
           “Lender”
 shall have the meaning indicated in the opening paragraph hereof.

 
	
  

 	
  

 
	
  

 	
           “Obligations” shall mean (a) all indebtedness, liabilities and
 obligations of the Borrower to the Lender of every kind, nature or
 description under the Credit Agreement, including the Borrower’s obligation
 on any promissory note or notes under the Credit Agreement and any note or
 notes hereafter issued in substitution or replacement thereof, (b) any and
 all liabilities and obligations of the Borrower to the Lender of every kind,
 nature and description, whether direct or indirect or hereafter acquired by
 the Lender from any Person, absolute or contingent, regardless of how such
 liabilities arise or by what agreement or instrument they may be evidenced,
 and (c) in all of the foregoing

 

1

	
  

 	
  

 
	
  

 	
 cases whether due or to become due, and whether now existing or
 hereafter arising or incurred.

 
	
  

 	
  

 
	
  

 	
           “Person”
 shall mean any individual, corporation, partnership, limited partnership,
 limited liability company, joint venture, firm, association, trust,
 unincorporated organization, government or governmental agency or political
 subdivision or any other entity, whether acting in an individual, fiduciary
 or other capacity.

 

          Section
2.     The Guaranty. Subject always to the
following Section, the Guarantor hereby absolutely and unconditionally
guarantees to the Lender the payment when due (whether at a stated maturity or
earlier by reason of acceleration or otherwise) and performance of the
Obligations.

          Section
3.     Limitation; Insolvency Laws. As used in
this Section: (a) the term “Applicable Insolvency Laws” means the laws of the
United States of America or of any State, province, nation or other
governmental unit relating to bankruptcy, reorganization, arrangement,
adjustment of debts, relief of debtors, dissolution, insolvency, fraudulent
transfers or conveyances or other similar laws (including, without limitation,
11 U. S. C. §547, §548, §550 and other “avoidance” provisions of Title 11 of
the United Stated Code) as applicable in any proceeding in which the validity
and/or enforceability of this Guaranty or any Specified Lien is in issue; and
(b) “Specified Lien” means any security interest, mortgage, lien or encumbrance
securing this Guaranty, in whole or in part. Notwithstanding any other
provision of this Guaranty, if, in any proceeding, a court of competent
jurisdiction determines that this Guaranty or any Specified Lien would, but for
the operation of this Section, be subject to avoidance and/or recovery or be
unenforceable by reason of Applicable Insolvency Laws, this Guaranty and each
such Specified Lien shall be valid and enforceable only to the maximum extent
that would not cause this Guaranty or such Specified Lien to be subject to
avoidance, recovery or unenforceability. To the extent that any payment to, or
realization by, the Lender on the guaranteed Obligations exceeds the
limitations of this Section and is otherwise subject to avoidance and recovery
in any such proceeding, the amount subject to avoidance shall in all events be
limited to the amount by which such actual payment or realization exceeds such
limitation, and this Guaranty as limited shall in all events remain in full
force and effect and be fully enforceable against the Guarantor This Section is
intended solely to reserve the rights of the Lender hereunder against the
Guarantor in such proceeding to the maximum extent permitted by Applicable
Insolvency Laws and neither the Guarantor the Borrower, any other guarantor of
the Obligations nor any Person shall have any right, claim or defense under
this Section that would not otherwise be available under Applicable Insolvency
Laws in such proceeding.

          Section
4.     Continuing Guaranty. This Guaranty is an
absolute, unconditional and continuing guaranty of payment and performance of
the Obligations, and the obligations of the Guarantor. hereunder shall not be
released, in whole or in part, by any action or thing which might, but for this
provision of this Guaranty, be deemed a legal or equitable discharge of a
surety or guarantor, other than irrevocable payment and performance in full of
the Obligations. No notice of the Obligations to which this Guaranty may apply,
or of any renewal or extension thereof need be given to the Guarantor and none
of the foregoing acts shall release the Guarantor from liability hereunder. The
Guarantor hereby expressly waives (a) demand of payment, presentment, protest,
notice of dishonor, nonpayment or nonperformance on any and all forms of

2

the
Obligations; (b) notice of acceptance of this Guaranty and notice of any
liability to which it may apply; (c) all other notices and demands of any kind
and description relating to the Obligations now or hereafter provided for by
any agreement, statute, law, rule or regulation; and (d) any and all defenses
of the Borrower pertaining to the Obligations except for the defense of
discharge by payment. The Guarantor shall not be exonerated with respect to the
Guarantor’s liabilities under this Guaranty by any act or thing except
irrevocable payment and performance of the Obligations, it being the purpose
and intent of this Guaranty that the Obligations constitute the direct and
primary obligations of the Guarantor and that the covenants, agreements and all
obligations of the Guarantor hereunder be absolute, unconditional and
irrevocable. The Guarantor shall be and remain liable for any deficiency
remaining after foreclosure of any mortgage, deed of trust or security
agreement securing all or any part of the Obligations, whether or not the
liability of the Borrower or any other Person for such deficiency is discharged
pursuant to statute, judicial decision or otherwise. The acceptance of this
Guaranty by the Lender is not intended and does not release any liability
previously existing of any guarantor or surety of any indebtedness of the
Borrower to the Lender.

          Section
5.     Other Transactions. The Lender is
expressly authorized (a) to exchange, surrender or release with or without
consideration any or all collateral and security which may at any time be
placed with it by the Borrower or by any other Person, or to forward or deliver
any or all such collateral and security directly to the Borrower for collection
and remittance or for credit, or to collect the same in any other manner
without notice to the Guarantor and (b) to amend, modify, extend or supplement
the Credit Agreement, any note or other instrument evidencing the Obligations
or any part thereof and any other agreement with respect to the Obligations,
waive compliance by the Borrower or any other Person with the respective terms
thereof and settle or compromise any of the Obligations without notice to the
Guarantor and without in any manner affecting the absolute liabilities of the
Guarantor hereunder. No invalidity, irregularity or unenforceability of all or
any part of the Obligations or of any security therefor or other recourse with
respect thereto shall affect, impair or be a defense to this Guaranty. The
liabilities of the Guarantor hereunder shall not be affected or impaired by any
failure, delay, neglect or omission on the part of the Lender to realize upon
any of the Obligations of the Borrower to the Lender, or upon any collateral or
security for any or all of the Obligations, nor by the taking by the Lender of
(or the failure to take) any other guaranty or guaranties to secure the
Obligations, nor by the taking by the Lender of (or the failure to take or the
failure to perfect its security interest in or other lien on) collateral or
security of any kind. No act or omission of the Lender, whether or not such
action or failure to act varies or increases the risk of, or affects the rights
or remedies of the Guarantor shall affect or impair the obligations of the
Guarantor hereunder. The Guarantor acknowledges that this Guaranty is in effect
and binding without reference to whether this Guaranty is signed by any other
Person or Persons, that possession of this Guaranty by the Lender shall be
conclusive evidence of due delivery hereof by the Guarantor and that this
Guaranty shall continue in full force and effect, both as to the Obligations
then existing and/or thereafter created, notwithstanding the release of or
extension of time to any other guarantor of the Obligations or any part
thereof.

          Section
6.     Actions Not Required. The Guarantor
hereby waives any and all right to cause a marshalling of the assets of the
Borrower or any other action by any court or other governmental body with
respect thereto or to cause the Lender to proceed against any security for the
Obligations or any other recourse which the Lender may have with respect
thereto and

3

further
waives any and all requirements that the Lender institute any action or
proceeding at law or in equity, or obtain any judgment, against the Borrower or
any other Person, or with respect to any collateral security for the
Obligations, as a condition precedent to making demand on or bringing an action
or obtaining and/or enforcing a judgment against, the Guarantor upon this
Guaranty. The Guarantor further acknowledges that time is of the essence with
respect to the Guarantor’s obligations under this Guaranty. Any remedy or right
hereby granted which shall be found to be unenforceable as to any Person or
under any circumstance, for any reason, shall in no way limit or prevent the
enforcement of such remedy or right as to any other Person or circumstance, nor
shall such unenforceability limit or prevent enforcement of any other remedy or
right hereby granted.

          Section
7.     No Subrogation. Notwithstanding any
payment or payments made by the Guarantor hereunder, the Guarantor waives all
rights of subrogation to any of the rights of the Lender against the Borrower
or any other Person liable for payment of any of the Obligations or any
collateral security or guaranty or right of offset held by the Lender for the
payment of the Obligations, and the Guarantor waives all rights to seek any
recourse to or contribution or reimbursement from the Borrower or any other
Person liable for payment of any of the Obligations in respect of payments made
by the Guarantor hereunder.

          Section
8.     Application of Payments. Any and all
payments upon the Obligations made by the Guarantor or by any other Person,
and/or the proceeds of any or all collateral or security for any of the
Obligations, may be applied by the Lender on such items of the Obligations as
the Lender may elect.

          Section
9.     Recovery of Payment. If any payment
received by the Lender and applied to the Obligations is subsequently set
aside, recovered, rescinded or required to be returned for any reason
(including, without limitation, the bankruptcy, insolvency or reorganization of
the Borrower or any other obligor), the Obligations to which such payment was
applied shall for the purposes of this Guaranty be deemed to have continued in
existence, notwithstanding such application, and this Guaranty shall be
enforceable as to such Obligations as fully as if such application had never
been made. References in this Guaranty to amounts “irrevocably paid” or to
“irrevocable payment” refer to payments that cannot be set aside, recovered,
rescinded or required to be returned for any reason.

          Section
10.     Borrower’s Financial Condition. The
Guarantor is familiar with the financial condition of the Borrower, and the
Guarantor has executed and delivered this Guaranty based on the Guarantor’s own
judgment and not in reliance upon any statement or representation of the
Lender. The Lender shall have no obligation to provide the Guarantor with any
advice whatsoever or to inform the Guarantor at any time of the Lender’s
actions, evaluations or conclusions on the financial condition or any other
matter concerning the Borrower.

          Section
11.     Remedies. All remedies afforded to the
Lender by reason of this Guaranty are separate and cumulative remedies and it
is agreed that no one of such remedies, whether or not exercised by the Lender,
shall be deemed to be in exclusion of any of the other remedies available to
the Lender and no one of such remedies shall in any way limit or prejudice any
other legal or equitable remedy which the Lender may have hereunder and with
respect to the

4

Obligations.
Mere delay or failure to act shall not preclude the exercise or enforcement of
any rights and remedies available to the Lender.

          Section
12.     Bankruptcy of the Borrower. The
Guarantor expressly agrees that the liabilities and obligations of the
Guarantor under this Guaranty shall not in any way be impaired or otherwise
affected by the institution by or against the Borrower or any other Person of
any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings,
or any other similar proceedings for relief under any bankruptcy law or similar
law for the relief of debtors and that any discharge of any of the Obligations
pursuant to any such bankruptcy or similar law or other law shall not diminish,
discharge or otherwise affect in any way the obligations of the Guarantor under
this Guaranty, and that upon the institution of any of the above actions, such
obligations shall be enforceable against the Guarantor.

          Section
13.     Costs and Expenses. The Guarantor will
pay or reimburse the Lender on demand for all reasonable out-of-pocket expenses
paid or incurred by the Lender, including in each case filing and recording
costs and fees, charges and disbursements of outside counsel to the Lender
(determined on the basis of such counsel’s generally applicable rates, which
may be higher than the rates such counsel charges the Lender in certain
matters) and/or the allocated costs of in-house counsel incurred from time to
time, arising out of or in connection with the collection and enforcement of
this Guaranty against the Guarantor or arising out of or in connection with any
failure of the Guarantor to fully and timely perform the obligations of the
Guarantor hereunder.

          Section
14.     Waivers and Amendments. This Guaranty
can be waived, modified, amended, terminated or discharged only explicitly in a
writing signed by the Lender. A waiver so signed shall be effective only in the
specific instance and for the specific purpose given.

          Section
15.     Notices. Any notice or other
communication to any party in connection with this Guaranty shall be in writing
and shall be sent by manual delivery, telegram, telex, facsimile transmission,
overnight courier or United States mail (postage prepaid) addressed to such
party at the address specified on the signature page hereof, or at such other
address as such party shall have specified to the other party hereto in
writing. All periods of notice shall be measured from the date of delivery
thereof if manually delivered, from the date of sending thereof if sent by
telegram, telex or facsimile transmission, from the first business day after
the date of sending if sent by overnight courier, or from four days after the
date of mailing if mailed.

          Section
16.     Guarantor Acknowledgements. The
Guarantor hereby acknowledges that (a) counsel has advised the Guarantor in the
negotiation, execution and delivery of this Guaranty, (b) the Lender has no
fiduciary relationship to the Guarantor the relationship being solely that of
debtor and creditor, and (c) no joint venture exists between the Guarantor and
the Lender.

          Section
17.     Representations and Warranties.
Electromed Financial, LLC hereby represents and warrants to the Lender that it
is a limited liability company organized, validly existing and in good standing
under the laws of the State of Minnesota and has the power and authority and
the legal right to own and operate its properties and to conduct the business
in which it is currently engaged. Electromed Financial, LLC further represents
and warrants to the Lender that:

5

	
  

 	
  

 
	
  

 	
           (a)     It
 has the power and authority and the legal right to execute and deliver, and
 to perform its obligations under, this Guaranty and has taken all necessary
 action required by its form of organization to authorize such execution,
 delivery and performance.

 
	
  

 	
  

 
	
  

 	
           (b)     This
 Guaranty constitutes its legal, valid and binding obligation enforceable in
 accordance with its terms, except as enforceability may be limited by
 applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
 affecting the enforcement of creditors’ rights generally and by general
 equitable principles (whether enforcement is sought by proceedings in equity
 or at law).

 
	
  

 	
  

 
	
  

 	
           (c)     The
 execution, delivery and performance of this Guaranty will not (i) violate any
 provision of any law, statute, rule or regulation or any order, writ,
 judgment, injunction, decree, determination or award of any court, governmental
 agency or arbitrator presently in effect having applicability to it, (ii)
 violate or contravene any provision of its organizational documents, or (iii)
 result in a breach of or constitute a default under any indenture, loan or
 credit agreement or any other agreement, lease or instrument to which it is a
 party or by which it or any of its properties may be bound or result in the
 creation of any lien thereunder. It is not in default under or in violation
 of any such law, statute, rule or regulation, order, writ, judgment,
 injunction, decree, determination or award or any such indenture, loan or
 credit agreement or other agreement, lease or instrument in any case in which
 the consequences of such default or violation could have a material adverse
 effect on its business, operations, properties, assets or condition
 (financial or otherwise).

 
	
  

 	
  

 
	
  

 	
           (d)     No
 order, consent, approval, license, authorization or validation of, or filing,
 recording or registration with, or exemption by, any governmental or public
 body or authority is required on its part to authorize, or is required in
 connection with the execution, delivery and performance of, or the legality,
 validity, binding effect or enforceability of, this Guaranty.

 
	
  

 	
  

 
	
  

 	
           (e)     There
 are no actions, suits or proceedings pending or, to its knowledge, threatened
 against or affecting it or any of its properties before any court or
 arbitrator, or any governmental department, board, agency or other
 instrumentality which, if determined adversely to it, would have a material
 adverse effect on its business, operations, property or condition (financial
 or otherwise) or on its ability to perform its obligations hereunder.

 
	
  

 	
  

 
	
  

 	
           (f)     It
 expects to derive benefits from the transactions resulting in the creation of
 the Obligations. The Lender may rely conclusively on the continuing warranty,
 hereby made, that it continues to be benefited by the Lender’s extension of
 credit accommodations to the Borrower and the Lender shall have no duty to
 inquire into or confirm the receipt of any such benefits, and this Guaranty
 shall be effective and enforceable by the Lender without regard to the
 receipt, nature or value of any such benefits.

 

6

          Section
18.     Continuing Guaranty; Assignments under
Credit Agreement. This Guaranty shall (a) remain in full force and effect
until irrevocable payment in full of the Obligations and the expiration of the
obligations, if any, of the Lender to extend credit accommodations to the
Borrower, (b) be binding upon the Guarantor, its successors and assigns and (c)
inure to the benefit of, and be enforceable by, the Lender and its successors,
transferees, and assigns. Without limiting the generality of the foregoing
clause (c), the Lender may assign or otherwise transfer all or any portion of
its rights and obligations under the Credit Agreement to any other Persons to
the extent and in the manner provided in the Credit Agreement and may similarly
transfer all or any portion of its rights under this Guaranty to such Persons.

          Section
19.     Reaffirmation. The Guarantor agrees
that when so requested by the Lender from time to time it will promptly execute
and deliver to the Lender a written reaffirmation of this Guaranty in such form
as the Lender may require.

          Section
20.     Revocation. Notwithstanding any other
provision hereof, the Guarantor may revoke this Guaranty prospectively as to
future transactions by written notice to that effect actually received by the
Lender. No such revocation shall release, impair or affect in any manner any
liability hereunder with respect to Obligations created, contracted, assumed or
incurred prior to receipt by the Lender of written notice of revocation, or
Obligations created, contracted, assumed or incurred after receipt of such
notice pursuant to any contract entered into by the Lender prior to receipt of
such notice, or any renewals or extensions thereof, theretofore or thereafter
made, or any interest accrued or accruing on such Obligations, or all other
costs, expenses and attorneys’ fees arising from such Obligations.

          Section
21.     Governing
Law and Construction. THE VALIDITY, CONSTRUCTION AND ENFORCEABILITY
OF THIS GUARANTY SHALL BE GOVERNED BY THE LAWS OF THE STATE OF MINNESOTA,
WITHOUT GIVING EFFECT TO CONFLICT OF LAWS PRINCIPLES THEREOF, BUT GIVING EFFECT
TO FEDERAL LAWS OF THE UNITED STATES APPLICABLE TO NATIONAL BANKS. Whenever
possible, each provision of this Guaranty and any other statement, instrument
or transaction contemplated hereby or relating hereto shall be interpreted in
such manner as to be effective and valid under such applicable law, but, if any
provision of this Guaranty or any other statement, instrument or transaction
contemplated hereby or relating hereto shall be held to be prohibited or
invalid under such applicable law, such provision shall be ineffective only to
the extent of such prohibition or invalidity, without invalidating the
remainder of such provision or the remaining provisions of this Guaranty or any
other statement, instrument or transaction contemplated hereby or relating
hereto.

          Section
22.     Consent
to Jurisdiction. AT THE OPTION OF THE LENDER, THIS GUARANTY MAY BE
ENFORCED IN ANY FEDERAL COURT OR MINNESOTA STATE COURT SITTING IN HENNEPIN COUNTY,
MINNESOTA; AND THE GUARANTOR CONSENTS TO THE JURISDICTION AND VENUE OF ANY SUCH
COURT AND WAIVES ANY ARGUMENT THAT VENUE IN SUCH FORUMS IS NOT CONVENIENT. IN
THE EVENT THE GUARANTOR COMMENCES ANY ACTION IN ANOTHER JURISDICTION OR VENUE
UNDER ANY TORT OR CONTRACT THEORY ARISING DIRECTLY OR INDIRECTLY FROM THE
RELATIONSHIP CREATED BY THIS GUARANTY, THE LENDER AT ITS OPTION SHALL BE

7

ENTITLED TO HAVE THE CASE TRANSFERRED TO ONE OF THE
JURISDICTIONS AND VENUES ABOVE-DESCRIBED, OR IF SUCH TRANSFER CANNOT BE
ACCOMPLISHED UNDER APPLICABLE LAW, TO HAVE SUCH CASE DISMISSED WITHOUT
PREJUDICE.

          Section
23.     Waiver of
Jury Trial. EACH OF THE GUARANTOR AND THE LENDER, BY ITS ACCEPTANCE
OF THIS GUARANTY, IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE
TRANSACTIONS CONTEMPLATED HEREBY.

          Section
24.     Counterparts. This Guaranty may be
executed in any number of counterparts, each of which when so executed and delivered
shall be deemed an original, but all such counterparts together shall
constitute but one and the same instrument.

          Section
25.     General. All representations and
warranties contained in this Guaranty or in any other agreement between the Guarantor
and the Lender shall survive the execution, delivery and performance of this
Guaranty and the creation and payment of the Obligations. Captions in this
Guaranty are for reference and convenience only and shall not affect the
interpretation or meaning of any provision of this Guaranty.

[The remainder of this page has been left blank intentionally.]

8

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

	
  

 	
  

 	
  

 
	
  

 	
 GUARANTOR:

 
	
  

 	
  

 	
  

 
	
  

 	
 ELECTROMED FINANCIAL, LLC

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 
	
  

 	
 By

 	
 

 
	
  

 	
 Name: Robert D. Hansen

 
	
  

 	
 Title: Chief Manager and Chief Executive Officer 

 

Address:

500
Sixth Avenue NW 

New Prague, MN 56071 

ATTN: Robert D. Hansen 

Fax Number: 952-758-1941

Address
for the Lender:

U.S.
Bank National Association 

BC-MN-H03W 

800 Nicollet Mall 

Minneapolis, MN 55402-4302 

ATTN: Daniel J. Miller 

Fax Number: 612-303-2252

[Signature Page to Guaranty]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00172-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00172-of-00352.parquet"}]]