Document:

EXHIBIT 10.4
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                                                               EXECUTION VERSION

                LIMITED RECOURSE GUARANTY AND SECURITY AGREEMENT

                  This LIMITED RECOURSE GUARANTY AND SECURITY AGREEMENT (this
"Guaranty"), dated as of September 26, 2007, is executed and delivered by
RONHOW, LLC, a Georgia limited liability company ("Guarantor"), in favor of
WELLS FARGO RETAIL FINANCE II, LLC, as collateral agent and administrative agent
(in such capacity, the "Agent") pursuant to the Loan Agreement (as defined
below) and in light of the following:

                  WHEREAS, HAROLD'S STORES, INC., an Oklahoma corporation, and
each of its subsidiaries and affiliates that is a signatory to the Loan
Agreement ("Borrowers"), Agent, and certain financial institutions party thereto
("Lenders") have entered into that certain Loan and Security Agreement, dated
February 5, 2003 (as amended, restated, modified, supplemented, renewed or
extended from time to time, the "Loan Agreement");

                  WHEREAS, the undersigned Guarantor has a material interest in
the financial prospects of the Borrowers in the Guarantor's capacity as the
Subordinated Lender under the Subordinated Loan Documents, and as a direct or
indirect owner of a material portion of the capital stock of each of the
Borrowers;

                  WHEREAS, as a result of the foregoing, the Guarantor will
benefit from the issuance of certain letters of credit or the provision of other
similar financial accommodations pursuant to the Loan Agreement as contemplated
pursuant to Amendment No. 7 to the Loan and Security Agreement, dated of even
date herewith (the "Amendment"); and

                  WHEREAS, in order to induce Agent to enter into the Amendment
and to extend the financial accommodations to Borrowers pursuant to the
Amendment, and in consideration thereof, and in consideration of any loans or
other financial accommodations heretofore or hereafter extended by Agent to
Borrowers, whether pursuant to the Loan Agreement or otherwise, Guarantor has
agreed to guaranty the Guarantied Obligations referred to below, subject to the
limitations set forth herein.

                  NOW, THEREFORE, in consideration of the foregoing, Guarantor
and Agent hereby agree as follows:

         1.       DEFINITIONS AND CONSTRUCTION.

(a) Definitions. Capitalized terms used herein and not otherwise defined herein
shall have the meanings ascribed to them in the Loan Agreement. The following
terms, as used in this Guaranty, shall have the following meanings:

                  "Agent" has the meaning set forth in the preamble to this
Guaranty.

                  "Amendment" has the meaning set forth in the preamble to this
Guaranty.

                  "Borrowers" has the meaning set forth in the preamble to this
Guaranty.

                  "Guarantied Obligations" means the following obligations of
any one or more Borrowers to Agent, the Lenders, the Issuing Lender, the
Underlying Issuer or any other member of the Lender Group, as applicable, in
respect of Letters of Credit (whether in respect of L/Cs or

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                                                               EXECUTION VERSION

L/C Undertakings) or any L/C Disbursements from time to time made pursuant to
such Letters of Credit: (i) to pay or reimburse L/C Disbursements for the
benefit of the Issuing Lender, the Underlying Issuer or the other Lenders, as
applicable, and (ii) to pay all interest from time to time accrued, due and
payable by any one or more Borrowers in respect of amounts subject to
reimbursement by Borrowers in respect of a Letter of Credit or an L/C
Disbursement.

                  "Guarantor" has the meaning set forth in the preamble to this
Guaranty.

                  "Guarantor's Deposit" means, as of any date of determination,
that portion of a $600,000.00 cash deposit (together with undisbursed interest
from time to time accrued in respect thereof) made by Guarantor with Agent in
connection with Guarantor's delivery of this Guaranty that is held by the Agent
as security for the Borrowers' performance of the Guaranteed Obligations, in an
identifiable general ledger account owned by the Agent and as to which the
balance thereof shall be documented as payable to the Guarantor upon the
termination of this Guaranty, subject to the terms hereof.

                  "Guaranty" has the meaning set forth in the preamble to this
Guaranty.

                  "Guaranty Limit" has the meaning set forth in Section 2 of
this Guaranty.

                  "Lenders" has the meaning set forth in the preamble to this
Guaranty.

                  "Loan Agreement" has the meaning set forth in the recitals to
this Guaranty.

                  "Voidable Transfer" has the meaning set forth in Section 9 of
this Guaranty.

         (b) Construction. Unless the context of this Guaranty clearly requires
otherwise, references to the plural include the singular, references to the
singular include the plural, the terms "includes" and "including" are not
limiting, and the term "or" has, except where otherwise indicated, the inclusive
meaning represented by the phrase "and/or." The words "hereof," "herein,"
"hereby," "hereunder," and similar terms in this Guaranty refer to this Guaranty
as a whole and not to any particular provision of this Guaranty. Section,
subsection, clause, schedule, and exhibit references herein are to this Guaranty
unless otherwise specified. Any reference in this Guaranty to any agreement,
instrument, or document shall include all alterations, amendments, changes,
extensions, modifications, renewals, replacements, substitutions, joinders, and
supplements, thereto and thereof, as applicable (subject to any restrictions on
such alterations, amendments, changes, extensions, modifications, renewals,
replacements, substitutions, joinders, and supplements set forth herein).
Neither this Guaranty nor any uncertainty or ambiguity herein shall be construed
against Agent or Guarantor, whether under any rule of construction or otherwise.
On the contrary, this Guaranty has been reviewed by all parties and shall be
construed and interpreted according to the ordinary meaning of the words used so
as to accomplish fairly the purposes and intentions of all parties hereto. Any
reference herein to any Person shall be construed to include such Person's
successors and assigns. Any requirement of a writing contained herein shall be
satisfied by the transmission of a Record and any Record transmitted shall
constitute a representation and warranty as to the accuracy and completeness of
the information contained therein.

         2.       GUARANTIED OBLIGATIONS; LIMITATION OF RECOURSE; TERMINATION OF
GUARANTY.

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                                                               EXECUTION VERSION

         (a) Subject to the terms and limitations specified in this Guaranty,
Guarantor hereby irrevocably and unconditionally guaranties to Agent, as and for
its own debt, until final payment in full thereof has been made, the prompt
payment in full of the Guarantied Obligations, when and as the same shall become
due and payable with the intent that the guaranty set forth herein shall be a
guaranty of payment and not a guaranty of collection. The guaranty herein
provided shall be one of primary obligor and there shall be no requirement that
Agent look to Borrowers or any other Person for payment or performance of the
Guaranteed Obligations prior to the assertion of liability of Guarantor
hereunder.

         (b) Notwithstanding Section 2(a) of this Guaranty, the total liability
of Guarantor shall not exceed, and shall be limited to, the amount of
Guarantor's Deposit from time to time maintained by or for the benefit of Agent
(the "Guaranty Limit"). To the extent the Guaranty Limit is not sufficient to
fully discharge and satisfy the Guaranteed Obligations, the Guarantor will not
be personally liable for any such deficiency. Agent's recourse under this
Guaranty shall be limited solely to its rights as a creditor secured by liens in
the Guarantor's Deposit and the related rights of setoff, and in each case with
recourse solely to the amount of Guarantor's Deposit maintained by Agent from
time to time, as and to the extent provided in this Guaranty. Guarantor
acknowledges and agrees that Guarantor's Deposit shall be subject to setoff in
respect all or any portion of the Guaranteed Obligations from time to time due
any payable without prior notice to Guarantor or any Borrower.

         (c) If, at any time (i)(A) there shall be no Guaranteed Obligations due
and payable by Borrowers or Guarantor pursuant to the Loan Agreement or this
Guaranty, as applicable, and no actual or potential claims shall have been
asserted pursuant to this Guaranty, (B) the Letter of Credit Usage shall be
zero, and (C) no applications for the issuance of Letters of Credit shall have
been presented to Agent or Issuing Lender, or (ii) all amounts of the
Guarantor's Deposit maintained by Agent shall have been set off against
Guaranteed Obligations pursuant to the terms of this Guaranty, Guarantor may
terminate this Guaranty by written notice to Agent. Agent shall notify Guarantor
in writing within 30 days of the satisfaction of all of the conditions specified
in either of clauses (i) or (ii) of the preceding sentence. Upon Guarantor's
delivery of written notice of termination to Agent, this Guaranty shall
terminate automatically and without requirement of further action by Guarantor,
Agent or any other Person, and Agent shall mark this Guaranty cancelled and
return the same to Guarantor together with the balance of the Guarantor's
Deposit (including accrued and undisbursed interest in respect thereof).

         3.       CONTINUING GUARANTY. This Guaranty includes Guarantied
Obligations arising under successive transactions continuing, compromising,
extending, increasing, modifying, releasing, or renewing the Guarantied
Obligations, changing the interest rate, payment terms, or other terms and
conditions thereof. To the maximum extent permitted by law, Guarantor hereby
waives any right to revoke this Guaranty as to future Guarantied Obligations,
except as expressly set forth at Section 2(c) of this Guaranty. If such a
revocation is effective notwithstanding the foregoing waiver, Guarantor
acknowledges and agrees that (a) no such revocation shall be effective until
written notice thereof has been received by Agent, (b) no such revocation shall
apply to any Guarantied Obligations in existence on such date (including any
subsequent continuation, extension, or renewal thereof, or change in the
interest rate, payment terms, or other terms and conditions thereof), (c) no
such revocation shall apply to any Guarantied Obligations made or created after
such date to the extent made or created pursuant to a legally

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binding commitment of Agent in existence on the date of such revocation, (d) no
payment by Guarantor, Borrowers, or from any other source, prior to the date of
such revocation shall reduce the maximum obligation of Guarantor hereunder, and
(e) any payment by Borrowers or from any source other than Guarantor subsequent
to the date of such revocation shall first be applied to that portion of the
Guarantied Obligations as to which the revocation is effective and which are
not, therefore, guarantied hereunder, and to the extent so applied shall not
reduce the maximum obligation of Guarantor hereunder.

         4.       SECURITY FOR GUARANTY.

         (a) As of the date of this Guaranty, the undersigned Guarantor has
delivered to Agent, as collateral for the obligations of Guarantor under this
Guaranty, cash in the amount of $600,000.

         (b) Guarantor hereby pledges, transfers and assigns to Agent, on behalf
of itself and the other members of the Lender Group, and grants to Agent as
security for obligations of Guarantor under this Guaranty to pay and perform the
Guaranteed Obligations, a continuing security interest in and to the Guarantor's
Deposit (which shall not include the amount of any disbursed interest in respect
thereof) and all of Guarantor's right, title and interest therein. This pledge,
assignment and grant of security interest shall secure payment of the Guaranteed
Obligations. Guarantor represents and warrants that Agent's security interest in
the Guarantor's Deposit is a valid, first priority, perfected security interest
in the Guarantor's Deposit. Guarantor represents that none of the Guarantor's
Deposit was obtained from Borrowers and that no Borrower has any right in or to
the Guarantor's Deposit, which is maintained solely as security for the
obligations of Guarantor hereunder. Agent is hereby authorized to setoff the
Guarantor's Deposit in full or partial satisfaction of the Guaranteed Obligation
as and when the same shall be due and payable.

         (c) Agent may co-mingle the Guarantor's Deposit with other funds of
Agent or deliver such funds to one or more of Agent's affiliates for investment
upon such terms as Agent shall determine at its election. Agent shall disburse
to Guarantor such interest as may accrue in respect of the Guarantor's Deposit
not less frequently than monthly, together with a reasonably detailed
calculation thereof. Such disbursements shall only be required after all
obligations of Guarantor hereunder that are then due and payable have been
satisfied pursuant to the terms of this Guaranty. Upon request of Guarantor from
time to time, Agent shall provide a statement of the amount of the Guarantor's
Deposit maintained by Agent and not applied in satisfaction of claims hereunder.

         5.       PRIMARY OBLIGATIONS. This Guaranty is a primary and original
obligation of Guarantor, is not merely the creation of a surety relationship,
and is, subject to the Guaranty Limit, an absolute, unconditional, and
continuing guaranty of payment and performance which shall remain in full force
and effect without respect to future changes in conditions until or unless this
Guaranty has been terminated pursuant to Section 2. Guarantor hereby agrees that
it is directly liable to Agent, that the obligations of Guarantor hereunder are
independent of the obligations of Borrowers or any other guarantor, and that a
separate action may be brought against Guarantor, whether such action is brought
against Borrowers or any other

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                                                               EXECUTION VERSION

guarantor or whether Borrowers or any other guarantor is joined in such action.
Guarantor hereby agrees that its liability hereunder shall be immediate and
shall not be contingent upon the exercise or enforcement by Agent of whatever
remedies they may have against Borrowers or any other guarantor, or the
enforcement of any lien or realization upon any security by Agent. Guarantor
hereby agrees that any release which may be given by Agent to Borrowers or any
other guarantor shall not release Guarantor. Guarantor consents and agrees that
Agent shall not be under any obligation to marshal any property or assets of
Borrowers or any other guarantor in favor of Guarantor, or against or in payment
of any or all of the Guarantied Obligations.

         6.       WAIVERS.

                  (a) To the fullest extent permitted by applicable law,
Guarantor hereby waives: (i) notice of acceptance hereof; (ii) notice of the
issuance of any Letters of Credit or the provision of other financial
accommodations to, or for the benefit of Borrowers, or the creation or existence
of any Guarantied Obligations; (iii) notice of the amount of the Guarantied
Obligations, subject, however, to Guarantor's right to make inquiry of Agent to
ascertain the amount of the Guarantied Obligations at any reasonable time; (iv)
notice of any adverse change in the financial condition of Borrowers or of any
other fact that might increase Guarantor's risk hereunder; (v) notice of
presentment for payment, demand, protest, and notice thereof as to any
instrument among the Loan Documents; and (vi) notice of any Default or Event of
Default under the Loan Agreement.

                  (b) To the fullest extent permitted by applicable law,
Guarantor hereby waives the right by statute or otherwise to require Agent to
institute suit against Borrowers or to exhaust any rights and remedies which
Agent has or may have against Borrowers. In this regard, Guarantor agrees,
subject to the Guaranty Limit, that it is bound to the payment of each and all
Guarantied Obligations, whether now existing or hereafter arising, as fully as
if the Guarantied Obligations were directly owing to Agent by Guarantor.
Guarantor further waives any defense arising by reason of any disability or
other defense (other than the defense that the Guarantied Obligations shall have
been performed and paid in cash, to the extent of any such payment) of Borrowers
or by reason of the cessation from any cause whatsoever of the liability of
Borrowers in respect thereof.

                  (c) To the fullest extent permitted by applicable law,
Guarantor hereby waives: (i) any right to assert against Agent any defense
(legal or equitable), set-off, counterclaim, or claim which Guarantor may now or
at any time hereafter have against Borrowers or any other party liable to Agent;
(ii) 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 the Guarantied Obligations or any
security therefor; (iii) any right or defense arising by reason of any claim or
defense based upon an election of remedies by Agent; (iv) the benefit of any
statute of limitations affecting Guarantor's liability hereunder or the
enforcement thereof, and any act which shall defer or delay the operation of any
statute of limitations applicable to the Guarantied Obligations shall similarly
operate to defer or delay the operation of such statute of limitations
applicable to Guarantor's liability hereunder.

                  (d) Until such time as this Guaranty shall have been
terminated in accordance with Section 2(c) of this Guaranty: (i) Guarantor
hereby waives and postpones any right of subrogation Guarantor has or may have
as against Borrowers with respect to the Guarantied Obligations; (ii) Guarantor
hereby waives and postpones any right to proceed against Borrowers 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),

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                                                               EXECUTION VERSION

with respect to the Guarantied Obligations; and (iii) Guarantor also hereby
waives and postpones any right to proceed or to seek recourse against or with
respect to any property or asset of Borrowers in respect of application of the
Guarantor's Deposit in full or partial satisfaction of the Guaranteed
Obligations from time to time arising.

                  (e) The payment obligations of Guarantor hereunder shall be
evidenced by Agent's books and records and, in the absence of manifest error,
shall be absolute, unconditional and irrevocable and shall not be affected,
modified or impaired by:

                           (i) any lack of validity or enforceability of any of
         the Letters of Credit, any other agreement or instrument relating
         thereto (collectively, the "Related Documents") or any of the
         transactions contemplated by or related to the Letters of Credit (the
         "Related Transactions");

                           (ii) any amendment or waiver of or any consent to
         departure from all or any of the Related Documents or the Related
         Transactions;

                           (iii) the existence of any claim, set-off, defense or
         other right which Borrowers may have at any time against any
         beneficiary or any transferee of any of the Letters of Credit, the
         Issuing Lender, the Agent, any Lender, the Underlying Issuer or any
         other Person, whether in connection with a Letter of Credit, the
         Related Documents, the Related Transactions or any unrelated document
         or transaction;

                           (iv) any draft affidavit, letter, certificate,
         invoice, bill of lading, statement or any other document presented
         under any of the Letters of Credit proving to be forged, fraudulent,
         invalid or insufficient in any respect or any statement therein being
         untrue or inaccurate in any respect; or

                           (v) payment by Issuing Lender or Underlying Issuer
         under any of the Letters of Credit against presentation of a draft or
         certificate which does not comply with the terms of such Letter of
         Credit.

                  (F) WITHOUT LIMITING THE GENERALITY OF ANY OTHER WAIVER OR
OTHER PROVISION SET FORTH IN THIS GUARANTY, GUARANTOR WAIVES ALL RIGHTS AND
DEFENSES ARISING OUT OF AN ELECTION OF REMEDIES BY AGENT, EVEN THOUGH SUCH
ELECTION OF REMEDIES, SUCH AS A NONJUDICIAL FORECLOSURE WITH RESPECT TO SECURITY
FOR THE GUARANTIED OBLIGATIONS, HAS DESTROYED GUARANTOR'S RIGHTS OF SUBROGATION
AND REIMBURSEMENT AGAINST BORROWERS BY THE OPERATION OF APPLICABLE LAW.

                  (g) Without limiting the generality of any other waiver or
other provision set forth in this Guaranty, Guarantor hereby agrees as follows:

                      (i) Agent's right to enforce this Guaranty is absolute and
is not contingent upon the genuineness, validity or enforceability of any of the
Loan Documents. Guarantor agrees that Agent's rights under this Guaranty shall
be enforceable even if Borrowers had no liability at the time of execution of
the Loan Documents or later ceases to be liable.

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                                                               EXECUTION VERSION

                      (ii) Guarantor agrees that Agent's rights under the Loan
Documents will remain enforceable even if the amount secured by the Loan
Documents is larger in amount and more burdensome than that for which Borrowers
are responsible. The enforceability of this Guaranty against Guarantor shall
continue until the earlier of Guarantor's payment of the amount of the Guaranty
Limit, the termination of this Guaranty, or when all sums due under the
Guarantied Obligations have been paid in full, and shall not be limited or
affected in any way by any impairment or any diminution or loss of value of any
security or collateral for Borrowers' obligations under the Loan Documents, from
whatever cause, the failure of any security interest in any such security or
collateral or any disability or other defense of Borrowers, any other guarantor
of Borrowers' obligations under any other Loan Document, any pledgor of
collateral for any person's obligations to Agent or any other person in
connection with the Loan Documents.

         7.       RELEASES. Guarantor consents and agrees that, without notice
to or by Guarantor and without affecting or impairing the obligations of
Guarantor hereunder, Agent may, by action or inaction, compromise or settle,
extend the period of duration or the time for the payment, or discharge the
performance of, or may refuse to enforce, 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 terms and provisions of the Loan Agreement or any other Loan Document or
may grant other indulgences to Borrowers 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 Agreement or any other Loan Document, or may, by action or inaction,
release or substitute any other guarantor, if any, of the Guarantied
Obligations, or may enforce, exchange, release, or waive, by action or inaction,
any security for the Guarantied Obligations or any other guaranty of the
Guarantied Obligations, or any portion thereof. Guarantor agrees that its
obligations hereunder shall not be released, diminished, impaired or reduced by
the occurrence of any one or more of the following events: (i) any Insolvency
Proceeding affecting Borrowers, Guarantor or any other guarantor of all or any
part of the Guarantied Obligations, or any of their respective property; (ii)
any failure by Agent to acquire, perfect or continue any lien or security
interest on collateral securing all or any part of the Guarantied Obligations or
this Guaranty; (iii) the impairment of any collateral securing all or any part
of the Guarantied Obligations or this Guaranty (including without limitation the
negligent impairment) or (iv) any other act or circumstance which might
otherwise constitute a defense available to, or discharge of, Borrowers,
Guarantor or any other guarantor of all or part of the Guarantied Obligations
other than the final and unconditional payment in full of the Guarantied
Obligations.

         8.       NO ELECTION. Agent shall have the right to seek recourse
against Guarantor to the fullest extent provided for herein and no election by
Agent to proceed in one form of action or proceeding, or against any party, or
on any obligation, shall constitute a waiver of Agent's right to proceed in any
other form of action or proceeding or against other parties unless Agent has
expressly waived such right in writing. Specifically, but without limiting the
generality of the foregoing, no action or proceeding by Agent under any document
or instrument evidencing the Guarantied Obligations shall serve to diminish the
liability of Guarantor under this Guaranty except to the extent that Agent
finally and unconditionally shall have realized (i) payment in full of the
Guarantied Obligations from the Guarantor up to the Guaranty Limit or (ii)
payment in full of the Guarantied Obligations by such action or proceeding.

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                                                               EXECUTION VERSION

         9.       REVIVAL AND REINSTATEMENT. If the incurrence or payment of the
Guarantied Obligations or the obligations of Guarantor under this Guaranty by
Guarantor or the transfer by Guarantor to Agent of any property of Guarantor
should for any reason subsequently be declared to be void or voidable under any
state or federal law relating to creditors' rights, including provisions of the
Bankruptcy Code relating to fraudulent conveyances, preferences, or other
voidable or recoverable payments of money or transfers of property
(collectively, a "Voidable Transfer"), and if Agent is required to repay or
restore, in whole or in part, any such Voidable Transfer, or elects to do so
upon the reasonable advice of its counsel, then, as to any such Voidable
Transfer, or the amount thereof that Agent is required or elects to repay or
restore, and as to all reasonable costs, expenses, and attorneys fees of Agent
related thereto, the liability of Guarantor automatically shall be revived,
reinstated, and restored and shall exist as though such Voidable Transfer had
never been made.

         10.      FINANCIAL CONDITION OF BORROWERS. Guarantor represents and
warrants to Agent that it is currently informed of the financial condition of
Borrowers and of all other circumstances which a diligent inquiry would reveal
and which bear upon the risk of nonpayment of the Guarantied Obligations.
Guarantor further represents and warrants to Agent that it has read and
understands the terms and conditions of the Loan Agreement and each other Loan
Document. Guarantor hereby covenants that it will continue to keep himself
informed of Borrowers' financial condition, the financial condition of other
guarantors, if any, and of all other circumstances which bear upon the risk of
nonpayment or nonperformance of the Guarantied Obligations.

         11.      NOTICES. All notices and other communications hereunder to
Agent shall be in writing and shall be mailed, sent, or delivered in accordance
with Section 12 of the Loan Agreement. All notices and other communications
hereunder to Guarantor shall be in writing and shall be mailed, sent, or
delivered to Guarantor at the address set forth below Guarantor's signature to
this Guaranty.

         12.      CUMULATIVE REMEDIES. Subject to Section 2, no remedy under
this Guaranty, under the Loan Agreement, or any other Loan Document is intended
to be exclusive of any other remedy, but each and every remedy shall be
cumulative and in addition to any and every other remedy given under this
Guaranty, under the Loan Agreement, or any other Loan Document, and those
provided by law. No delay or omission by Agent to exercise any right under this
Guaranty shall impair any such right nor be construed to be a waiver thereof. No
failure on the part of Agent to exercise, and no delay in exercising, any right
under this Guaranty shall operate as a waiver thereof; nor shall any single or
partial exercise of any right under this Guaranty preclude any other or further
exercise thereof or the exercise of any other right.

         13.      SEVERABILITY OF PROVISIONS. Each provision of this Guaranty
shall be severable from every other provision of this Guaranty for the purpose
of determining the legal enforceability of any specific provision.

         14.      ENTIRE AGREEMENT; AMENDMENTS. This Guaranty constitutes the
entire agreement between Guarantor and Agent pertaining to the subject matter
contained herein. This Guaranty may not be altered, amended, or modified, nor
may any provision hereof be waived or noncompliance therewith consented to,
except by means of a writing executed by Guarantor and Agent. Any such
alteration, amendment, modification, waiver, or consent shall be effective only

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                                                               EXECUTION VERSION

to the extent specified therein and for the specific purpose for which given. No
course of dealing and no delay or waiver of any right or default under this
Guaranty shall be deemed a waiver of any other, similar or dissimilar, right or
default or otherwise prejudice the rights and remedies hereunder.

         15.      PRECEDENCE. In the event of any conflict between the terms or
conditions of this Guaranty and the terms or conditions of any of the
Subordinated Loan Documents, or of the Intercreditor Agreement, the conflicting
terms or conditions of such Subordinated Loan Document or of the Intercreditor
Agreement shall prevail.

         16.      SUCCESSORS AND ASSIGNS. This Guaranty shall be binding upon
Guarantor and its personal representatives, heirs, successors and assigns and
shall inure to the benefit of the successors and assigns of Agent; provided,
however, Guarantor may not assign this Guaranty or delegate any of its duties
hereunder without Agent's prior written consent and any unconsented to
assignment shall be absolutely void.

         17.      NO THIRD PARTY BENEFICIARY. This Guaranty is solely for the
benefit of Agent and Guarantor and their respective successors and assigns, and
may not be relied on by any other Person.

         18.      CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.

                  THE VALIDITY OF THIS GUARANTY, THE CONSTRUCTION,
INTERPRETATION, AND ENFORCEMENT HEREOF, AND THE RIGHTS OF THE PARTIES HERETO
WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR RELATED HERETO SHALL BE
DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS.

                  THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN
CONNECTION WITH THIS GUARANTY SHALL BE TRIED AND LITIGATED ONLY IN THE STATE
AND, TO THE EXTENT PERMITTED BY APPLICABLE LAW, FEDERAL COURTS LOCATED IN THE
STATE AND FEDERAL COURTS LOCATED IN THE COUNTY OF SUFFOLK, COMMONWEALTH OF
MASSACHUSETTS, PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY
COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT AGENT'S OPTION, IN THE COURTS OF
ANY JURISDICTION WHERE AGENT ELECTS TO BRING SUCH ACTION OR WHERE SUCH
COLLATERAL OR OTHER PROPERTY MAY BE FOUND. GUARANTOR AND AGENT WAIVE, TO THE
EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE
DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY
PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 19.

                  EACH OF GUARANTOR AND AGENT HEREBY WAIVES HIS OR ITS RIGHTS TO
A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS
GUARANTY OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN, INCLUDING CONTRACT
CLAIMS, TORT CLAIMS,

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                                                               EXECUTION VERSION

BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. EACH OF
GUARANTOR AND AGENT REPRESENTS THAT HE OR IT HAS REVIEWED THIS WAIVER AND EACH
KNOWINGLY AND VOLUNTARILY WAIVES HIS OR ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF THIS
GUARANTY MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

         19.      COUNTERPARTS; TELEFACSIMILE EXECUTION. This Guaranty may be
executed in any number of counterparts and by different parties on separate
counterparts, each of which, when executed and delivered, shall be deemed to be
an original, and all of which, when taken together, shall constitute but one and
the same Guaranty. Delivery of an executed counterpart of this Guaranty by
telefacsimile shall be equally as effective as delivery of an original executed
counterpart of this Guaranty. Any party delivering an executed counterpart of
this Guaranty by telefacsimile also shall deliver an original executed
counterpart of this Guaranty but the failure to deliver an original executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Guaranty.

LIMITED RECOURSE GUARANTY - Page 10
-------------------------
<PAGE>

                  IN WITNESS WHEREOF, each of the undersigned has executed and
delivered this Guaranty as of the date first written above.

                                       RONHOW, LLC, a Georgia limited liability
                                       company

                                       By: Ronus, Inc., a Georgia corporation,
                                           Managing Member

                                           By: Robert L. Anderson
                                              ----------------------------------
                                           Name:  Robert L. Anderson
                                           Title:    President

                                           Address: 3290 Northside Pkwy Ste. 225
                                                    Atlanta, Ga. 30327

STATE OF GEORGIA

COUNTY OF FULTON

         Be it remembered that on this 26th day of September, 2007, in the
County and State aforesaid, before me, the subscriber, a Notary Public
authorized to take acknowledgments and proofs in said County and State,
personally appeared Robert L. Anderson as President of Ronus, Inc., who I am
satisfied is the representative of guarantor named in and who executed the
foregoing instrument and he did acknowledge that he signed, sealed and delivered
the same as its act and deed for the uses and purposes therein expressed.

                                           /s/ Helga E. Barry
                                              ----------------------------------
                                           Name: Helga E. Barry
                                                --------------------------------
                                           Notary Public, DeKalb County, Georgia

My commission expires:
October 30, 2008

                                       ACCEPTED AND AGREED BY AGENT:

                                       WELLS FARGO RETAIL FINANCE II, LLC

                                           By: /s/ Lynn Whitmore
                                              ----------------------------------
                                           Name:  Lynn Whitmore
                                           Title:    Senior Vice President

                          [SIGNATURE PAGE TO GUARANTY]

                                       S-1WWW.EXFILE.COM, INC. -- MATRITECH, INC. -- EXHIBIT 10.1 TO FORM 8-K

    EXHIBIT
      10.1

    
 

    Termination
      Agreement

    

    

    This
      Termination Agreement is made as
      of this 28th­ day of September, 2007 by and between Sysmex Corporation
      (“Sysmex”), a Japanese corporation with its principal place of business at
      1-5-1, Wakinohama-kaigandori, Chuo-ku, Kobe, Hyogo 651-0073, Japan and
      Matritech, Inc. (“Matritech”), a Delaware corporation with its principal place
      of business at 330 Nevada Street, Newton, MA 02460 USA.

    

    Whereas,
      the parties previously entered
      into a Exclusive License and Exclusive Supply Agreement dated November 20,
      2002
      (the “Agreement”); and

    

    Whereas,
      the parties desire to
      terminate the Agreement upon the terms and conditions set forth
      herein.

    

    Now,
      Therefore, in consideration of the
      premises and for good and valuable consideration, the receipt and legal
      sufficiency of which is hereby acknowledged, the parties hereto agree as
      follows:

    

    1.           Except
      for obligations of each expressly contained in this Termination Agreement,
      each
      of Sysmex and Matritech agrees that, upon full execution of this Termination
      Agreement, all rights and obligations of each of them to the other are
      terminated.  Neither party shall have any further rights or
      obligations to the other on account of the Agreement, except as specifically
      set
      forth herein.  Without limiting the generality of the foregoing, any
      and all license rights granted to Sysmex by Matritech are hereby
      terminated.

    

    2.           Sysmex
      will immediately cease all use of NMP179® antibodies
      and
      reagents, will destroy any and all supplies of NMP179 antibodies or reagents
      it
      possesses or controls and will provide Matritech on or before October 5, 2007
      a
      certification signed by an executive officer of Sysmex that it has complied
      in
      full with the provisions of this paragraph.

    

    3.           Sysmex
      will pay to Matritech the sum of US$16,667 on or before November 15, 2007,
      representing 2/3 of the fiscal third quarter payment that would be due under
      Section 16.2 of the Agreement.

    

    4.           Matritech
      will release, on or before November 15, 2007, all restrictions on the shares
      of
      common stock of Matritech acquired by Sysmex pursuant to Section 16.1 of the
      Agreement (the “Shares”) and thereafter Sysmex will be free to sell, transfer or
      otherwise dispose of the Shares upon compliance with applicable provision of
      Rule 144 of the Securities Act of 1933.

    

    5.           Sysmex
      agrees that Matritech may file, and further agrees to cooperate with Matritech
      in preparing and filing, any and all appropriate notices reflecting release
      of
      the exclusive license granted by Matritech to Sysmex under the
      Agreement.

    

    
      
         

      

      
        -
          1
          -

        
          

        

      

      
         

      

    

    6.           Sysmex
      and Matritech agree that they will jointly instruct American Type Culture
      Collection (“ATCC”) the escrow agent for material under Section 8.4 of the
      Agreement, that the Escrow Agreement among Matriech, Sysmex and ATCC dated
      September 30, 2003 (the “Escrow Agreement”) is terminated, effective on the date
      of effectiveness of this Termination Agreement, and further jointly instruct
      ATCC to immediately release to Matritech all material held by ATCC under the
      Escrow Agreement.  The parties agree that either of them may provide
      ATCC with an executed copy of this Termination Agreement as evidence of the
      joint instruction of the parties hereunder.

    

    7.           Notwithstanding
      the termination of the Agreement, the confidentiality provisions of Section
      20
      of the Agreement shall nonetheless survive and remain in full force and
      effect.

    

    8.           Except
      as expressly set forth herein, Sysmex hereby releases, on behalf of itself,
      its
      successors, assigns, affiliates, shareholders, officers, directors, agents
      and
      employees (collectively the “Sysmex Releasor Parties”), and forever discharges
      Matritech, its successors, assigns, affiliates, shareholders, officers,
      directors, agents and employees (collectively the “Matritech Released Parties”)
      of and from any and all actions, causes of action, suits, acts, omissions,
      negligence, promises, agreements, warranties, damages, costs, and any and all
      claims, demands and liabilities whatsoever, of every kind and nature, absolute
      or contingent, based on any statute, in contract or tort, in law or in equity,
      which the Sysmex Releasor Parties or any of them now have, have had, or may
      have, against Matritech or the Matritech Released Parties from the beginning
      of
      the world to the date of this Termination Agreement.

    

    9.           Except
      as expressly set forth herein, Matritech hereby releases, on behalf of itself,
      its successors, assigns, affiliates, shareholders, officers, directors, agents
      and employees (collectively the “Matritech Releasor Parties”), and forever
      discharges Sysmex, its successors, assigns, affiliates, shareholders, officers,
      directors, agents and employees (collectively the “Sysmex Released Parties”) of
      and from any and all actions, causes of action, suits, acts, omissions,
      negligence, promises, agreements, warranties, damages, costs, and any and all
      claims, demands and liabilities whatsoever, of every kind and nature, absolute
      or contingent, based on any statute, in contract or tort, in law or in equity,
      which the Matritech Releasor Parties or any of them now have, have had, or
      may
      have, against Sysmex or the Sysmex Released Parties from the beginning of the
      world to the date of this Termination Agreement.

    

    10.           Either
      party may assign this Termination Agreement to a party who acquires all or
      substantially all of its business by merger, sale of assets or
      otherwise.  Except as set forth in the preceding sentence, neither
      party may assign this Termination Agreement without the written permission
      of
      the other.

    

    11.           The
      validity, interpretation, enforceability and performance of this Termination
      Agreement shall be governed by and construed in accordance with the laws of
      the
      Commonwealth of Massachusetts, USA, without regard to the conflicts of law
      principles.

    

    12.           Any
      and all disputes or controversies arising out of or relating to this Termination
      Agreement shall be submitted to arbitration, which shall be conducted either
      in
      Boston, 

     

    
      
         

      

      
        -
          2
          -

        
          

        

      

      
         

      

    

    Massachusetts
      if Sysmex requests such arbitration or in Osaka, Japan if Matritech requests
      such arbitration by a panel of three arbitrators pursuant to the rules of the
      International Chamber of Commerce and shall be final and binding on all the
      parties.

    

    13.           This
      Termination Agreement may be executed in two or more counterparts, each of
      which
      shall be deemed an original, but all of which together shall constitute one
      and
      the same instrument.  This Termination Agreement may also be executed
      via facsimile or by portable document format (pdf), either of which shall be
      deemed an original.

    

    13.           This
      Termination Agreement shall take effect when the last signature of the parties
      to this Termination Agreement is obtained.

    

    

    In
      Witness Whereof, the parties hereto have set their hands and seals as of the
      day
      and year first above written.

    

    

    
      	
              Sysmex
                Corporation

               

              By:  Tameo Iwasaki

              
                

              

              Its Managing Director, duly authorized

               

              Date:   September 26, 2007

              
                

              

            	
              Matritech,
                Inc.

               

              By:   /s/ David L. Corbet

              
                

              

              Its
                President, duly authorized

               

              Date:   September 26, 2007

              
                

              

            

    

                                                                                         

    

                                                                                                                                                  
;                                                                       

    

                                                                                                    

    
      
         

      

      
        -
          3
          -

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